UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21265
PowerShares Exchange-Traded Fund Trust
(Exact name of registrant as specified in charter)
3500 Lacey Road
Downers Grove, IL 60515
(Address of principal executive offices) (Zip code)
Andrew Schlossberg
President
3500 Lacey Road
Downers Grove, IL 60515
(Name and address of agent for service)
Registrant’s telephone number, including area code: 800-983-0903
Date of fiscal year end: April 30
Date of reporting period: April 30, 2014
Item 1. Reports to Stockholders.
The Registrant’s annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 is as follows:
April 30, 2014 |
2014 Annual Report to Shareholders
DWAQ | PowerShares DWA NASDAQ Momentum Portfolio (formerly PowerShares Dynamic OTC Portfolio) | |
PWC | PowerShares Dynamic Market Portfolio | |
PRF | PowerShares FTSE RAFI US 1000 Portfolio | |
PRFZ | PowerShares FTSE RAFI US 1500 Small-Mid Portfolio |
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Domestic Equity
The U.S. equity market rose to multiyear or all-time highs during the fiscal year ended April 30, 2014.1 Corporate earnings were resilient in the face of modest economic growth, driven by strong profitability across many sectors, and fundamentals for corporations and consumers remained relatively stable following significant recovery in prior years.
However, the fiscal year began with capital markets in the U.S. declining. In May and June 2013, equity and fixed income markets fell following then-U.S. Federal Reserve (the “Fed”) Chairman Ben Bernanke’s comments suggesting that the time was approaching to reduce, or “taper,” the size of its bond buying economic stimulus program. This sell-off was brief but broad, and few asset classes were immune. Markets stabilized in mid-summer and generally rose, with some brief interruptions, through the end of 2013. The Fed’s announcement in December that tapering of its bond purchases would begin in early 2014 had little effect on equities as the announcement was widely anticipated. After strong performance in the second half of 2013, the U.S. equity market turned volatile in the first four months of 2014 as investors worried that stocks may have risen too high, too fast in 2013. Adding to this investor uncertainty during 2014 was political upheaval in Ukraine and signs of economic sluggishness in the U.S. and China.
1 | Source: Reuters |
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DWAQ | Manager’s Analysis | |
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic OTC Portfolio to PowerShares DWA NASDAQ Momentum Portfolio and the underlying index changed from Dynamic OTC IntellidexSM Index to Dorsey Wright NASDAQ Technical Leaders Index. The Fund changed its ticker symbol from PWO to DWAQ and also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA NASDAQ Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dorsey Wright NASDAQ Technical Leaders Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes companies in the Index pursuant to a proprietary methodology that is designed to identify companies that demonstrate powerful relative strength characteristics based upon their market performance. The Index Provider ranks a starting universe of approximately 1,000 equity securities traded on The NASDAQ Stock Market, LLC that have the largest market capitalizations using a proprietary methodology based upon each security’s market performance to determine each securities “momentum” score. A “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. Each security’s score is based on intermediate and long-term upward price movements relative to a representative market benchmark and the other eligible securities. The Index Provider identifies 100 securities with the highest momentum score to include in the Index. Securities with larger momentum scores receive greater weight within the Index. The Index is rebalanced and reconstituted quarterly, but no changes are made to the Index between these quarterly rebalance dates. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 16.77%. On a net asset value (“NAV”) basis, the Fund returned 16.64%. During the same time period, the Blended- Dorsey Wright NASDAQ Technical Leaders Index returned 17.43%, while the Dynamic OTC IntellidexSM Index, the Fund’s previous underlying index, returned 29.05%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable underlying index, during such periods as the Fund was seeking to track the relevant index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the NASDAQ Composite Index (the “Benchmark Index”) returned 23.61%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 2,499 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of broad-based equity market benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the equity market.
The performance of the Fund differed from the Benchmark Index because the Index employs a proprietary stock selection and weighting methodology whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, the Fund was most overweight in the healthcare and information technology sectors and most underweight in the materials and consumer staples sectors during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the healthcare sector contributed most significantly to the Fund’s return, followed by the consumer discretionary and consumer staples sectors, respectively. Energy was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Keurig Green Mountain, Inc., a consumer staples company (portfolio average weight of 2.19%), and Micron Technology, Inc., an information technology company (portfolio average weight of 1.54%). Positions that detracted most significantly from the Fund’s return included Jazz Pharmaceuticals PLC, a health care company (portfolio average weight of 0.68%), and CalAmp Corp., an information technology company (portfolio average weight of 0.3%).
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PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) (continued)
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Health Care | 38.1 | |||
Information Technology | 23.6 | |||
Consumer Discretionary | 19.2 | |||
Industrials | 9.6 | |||
Financials | 4.3 | |||
Energy | 2.5 | |||
Consumer Staples | 2.0 | |||
Materials | 0.7 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Gilead Sciences, Inc. | 3.5 | |||
Apple, Inc. | 3.4 | |||
Jazz Pharmaceuticals PLC | 3.1 | |||
Starz, Class A | 3.0 | |||
Accelerate Diagnostics, Inc. | 2.8 | |||
Henry Schein, Inc. | 2.7 | |||
Priceline Group, Inc. (The) | 2.6 | |||
Regeneron Pharmaceuticals, Inc. | 2.0 | |||
Measurement Specialties, Inc. | 1.9 | |||
ACADIA Pharmaceuticals, Inc. | 1.9 | |||
Total | 26.9 |
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PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) (continued)
Growth of a $10,000 Investment
Fund Performance History as of 4/30/14
Index | 1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | 10 Years Avg. Ann.††† | 10 Years Cumulative | Fund Inception† | ||||||||||||||||||||||||||||||
Avg. Ann.††† | Cumulative | |||||||||||||||||||||||||||||||||||||
Blended-Dorsey Wright NASDAQ Technical LeadersTM†† | 17.43 | % | 7.74 | % | 25.05 | % | 15.82 | % | 108.43 | % | 6.76 | % | 92.42 | % | 8.64 | % | 148.66 | % | ||||||||||||||||||||
Dorsey Wright NASDAQ Technical LeadersTM†† | 19.16 | 11.93 | 40.22 | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||
Dynamic OTC IntellidexSM Index†† | 29.05 | 11.18 | 37.43 | 18.03 | 129.06 | 7.78 | 111.46 | 9.57 | 173.28 | |||||||||||||||||||||||||||||
NASDAQ Composite Index | 23.61 | 12.71 | 43.19 | 19.10 | 139.59 | 7.92 | 114.29 | 9.79 | 179.42 | |||||||||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||||||||||
NAV Return | 16.64 | 6.94 | 22.31 | 14.99 | 101.04 | 6.10 | 80.78 | 7.93 | 131.57 | |||||||||||||||||||||||||||||
Market Price Return | 16.77 | 6.94 | 22.30 | 14.98 | 100.98 | 6.08 | 80.43 | 7.92 | 131.21 |
Fund Inception: May 1, 2003
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.96%, including acquired fund fees and expenses of 0.01%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended-Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years,” “10 Years” and “Fund Inception” performance for the Dorsey Wright NASDAQ Technical LeadersTM Index is not available because that Index did not commence calculation until March 31, 2011. The Blended-Dorsey Wright NASDAQ Technical LeadersTM Index performance is comprised of the performance of the Dynamic OTC IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
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PWC | Manager’s Analysis | |
PowerShares Dynamic Market Portfolio (PWC) |
As an index fund, the PowerShares Dynamic Market Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Market IntellidexSM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks that comprise the Index.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes stocks that, based upon its rankings, it believes possess the greatest investment potential for the Index. The Index uses market-like sector weightings and market-capitalization groupings in seeking to produce a sector and size dispersion similar to the overall broad market. The Index Provider ranks the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ for investment potential using a proprietary model. The Index Provider ranks companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, and then sorts them based on their cumulative score on the above criteria. The Index Provider divides the universe of stocks into ten economic sectors and divides each sector into two market-capitalization groupings: large and mid/small. The Index includes 100 companies from the top of each sector and size category. The Index Provider selects a defined number of the top ranked large and mid/small stocks within each sector. The number of stocks selected within a sector is predetermined and based on the percentage of the overall market represented by such sector. The Index Provider allocates 70% of the Index weighting to 30 large-capitalization stocks across the sectors and 30% of the Index weighting to 70 mid/small-capitalization stocks across the sectors. The index provider equally weights stock within their size groups. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 26.15%. On a net asset value (“NAV”) basis, the Fund returned 26.09%. During the same time period, the Index returned 26.97%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Index (the “Benchmark Index”) returned 20.44%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 500 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar broad market benchmark. The Benchmark Index was selected for its recognition
in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the broad U.S. stock market.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a modified equal weighting and stock selection methodology whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the information technology sector and most underweight in the financials sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to the stocks that outperformed within the industrials and health care sectors.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the information technology and health care sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Delta Air Lines, Inc., an industrials company (portfolio average weight of 1.4%), and Southwest Airlines Co., an industrials company (portfolio average weight of 2.31%). Positions that detracted most significantly from the Fund’s return included PulteGroup, Inc., a consumer discretionary company (portfolio average weight of 0.55%), and Apache Corporation, an energy company (portfolio average weight of 0.86%).
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PowerShares Dynamic Market Portfolio (PWC) (continued)
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Information Technology | 18.5 | |||
Financials | 13.9 | |||
Consumer Discretionary | 13.5 | |||
Health Care | 12.6 | |||
Energy | 12.3 | |||
Industrials | 11.1 | |||
Consumer Staples | 9.1 | |||
Materials | 3.8 | |||
Utilities | 2.9 | |||
Telecommunication Services | 2.3 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Valero Energy Corp. | 4.6 | |||
Marathon Oil Corp. | 4.2 | |||
Archer-Daniels-Midland Co. | 3.3 | |||
CVS Caremark Corp. | 3.0 | |||
Hewlett-Packard Co. | 2.9 | |||
Micron Technology, Inc. | 2.8 | |||
Mosaic Co. (The) | 2.8 | |||
Western Digital Corp. | 2.7 | |||
Northrop Grumman Corp. | 2.6 | |||
L-3 Communications Holdings, Inc. | 2.6 | |||
Total | 31.5 |
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PowerShares Dynamic Market Portfolio (PWC) (continued)
Growth of a $10,000 Investment
Fund Performance History as of 4/30/14
Index | 1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | 10 Years Avg. Ann.†† | 10 Years Cumulative | Fund Inception† | ||||||||||||||||||||||||||||||
Avg. Ann.†† | Cumulative | |||||||||||||||||||||||||||||||||||||
Dynamic Market IntellidexSM Index | 26.97 | % | 15.53 | % | 54.22 | % | 19.75 | % | 146.26 | % | 8.94 | % | 135.36 | % | 10.85 | % | 210.66 | % | ||||||||||||||||||||
S&P 500® Index | 20.44 | 13.83 | 47.48 | 19.14 | 140.02 | 7.67 | 109.32 | 8.98 | 157.34 | |||||||||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||||||||||
NAV Return | 26.09 | 14.74 | 51.05 | 18.92 | 137.79 | 8.31 | 122.22 | 10.17 | 190.20 | |||||||||||||||||||||||||||||
Market Price Return | 26.15 | 14.75 | 51.12 | 18.92 | 137.88 | 8.30 | 122.05 | 10.17 | 190.17 |
Fund Inception: May 1, 2003
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.63%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
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PRF | Manager’s Analysis | |
PowerShares FTSE RAFI US 1000 Portfolio (PRF) |
As an index fund, the PowerShares FTSE RAFI US 1000 Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the FTSE RAFI US 1000 Index (the “Index”). The Fund generally will invest at least 90% of its total assets in securities that comprise the Index.
FTSE International Limited and Research Affiliates, LLC (collectively, the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider selects its components from the universe of stocks that are incorporated in the United States. The Index is designed to track the performance of the largest U.S. equity stocks that the Index Provider includes in the Index based on four fundamental measures of firm size: book value, cash flow, sales and dividends. The Index Provider ranks the universe of companies by equally weighting each fundamental measure. It then takes 1,000 stocks with the highest fundamental weight and assigns a weight equal to its investable RAFI fundamental value, rather than their market capitalization. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 21.61%. On a net asset value (“NAV”) basis, the Fund returned 21.68%. During the same time period, the Index returned 22.13%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 1000® Index (the “Benchmark Index”) returned 20.81%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,000 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a broad U.S. equity large cap benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. large cap market.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the financials sector and most underweight in the information technology sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the
Benchmark Index during that period can be attributed to the stocks that outperformed within these sectors.
For the fiscal year ended April 30, 2014, the financials sector contributed most significantly to the Fund’s return, followed by the industrials and information technology sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Bank of America Corp., a financials company (portfolio average weight of 2.29%), and Exxon Mobil Corp., an energy company (portfolio average weight of 2.82%). Positions that detracted most significantly from the Fund’s return included Verizon Communications Inc., a telecommunication services company (portfolio average weight of 1.30%), and NII Holdings, Inc., a telecommunication services company (portfolio average weight of 0.05%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 20.2 | |||
Energy | 13.3 | |||
Information Technology | 11.4 | |||
Industrials | 11.0 | |||
Consumer Discretionary | 10.5 | |||
Health Care | 10.2 | |||
Consumer Staples | 10.0 | |||
Utilities | 5.3 | |||
Materials | 4.1 | |||
Telecommunication Services | 4.0 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Exxon Mobil Corp. | 3.2 | |||
Chevron Corp. | 2.2 | |||
AT&T, Inc. | 2.1 | |||
General Electric Co. | 1.9 | |||
JPMorgan Chase & Co. | 1.7 | |||
Bank of America Corp. | 1.6 | |||
Wells Fargo & Co. | 1.5 | |||
Berkshire Hathaway, Inc., Class B | 1.4 | |||
Pfizer, Inc. | 1.3 | |||
Verizon Communications, Inc. | 1.3 | |||
Total | 18.2 |
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PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
FTSE RAFI US 1000 Index | 22.13 | % | 14.68 | % | 50.82 | % | 22.33 | % | 173.98 | % | 9.04 | % | 106.14 | % | ||||||||||||||||
Russell 1000® Index | 20.81 | 13.80 | 47.37 | 19.52 | 143.86 | 7.42 | 81.96 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 21.68 | 14.25 | 49.12 | 21.89 | 169.01 | 8.55 | 98.64 | |||||||||||||||||||||||
Market Price Return | 21.61 | 14.23 | 49.06 | 21.87 | 168.86 | 8.58 | 99.02 |
Fund Inception: December 19, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.43%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
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PRFZ | Manager’s Analysis | |
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) |
As an index fund, the PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the FTSE RAFI US 1500 Small-Mid Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks that comprise the Index.
FTSE International Limited and Research Affiliates, LLC (collectively, the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider selects the components from the universe of stocks that are incorporated in the United States. The Index is designed to track the performance of small and medium-sized U.S. equity stocks that the Index Provider includes in the Index based on four fundamental measures of firm size: book value, cash flow, sales and dividends. The Index Provider calculates an overall weight for each company by equally weighting each fundamental measure and excluding dividends from the average for companies that have never paid dividends. The Index Provider then excludes the equities with a fundamental weight ranking of 1 through 1,000 and instead includes the equities with a fundamental weight ranking of 1,001 through 2,500. Finally, the Index Provider assigns a weight to each of these 1,500 stocks by their investable RAFI fundamental value rather than their market capitalization. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 25.40%. On a net asset value (“NAV”) basis, the Fund returned 25.22%. During the same time period, the Index returned 25.50%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 2000® Index (the “Benchmark Index”) returned 20.50%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 2,000 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a U.S. small cap stock benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. small cap stock market.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the consumer discretionary sector and most underweight in the
health care sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to the stocks that outperformed within the financial and information technology sectors.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the information technology and consumer discretionary sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included GT Advanced Technologies Inc., an information technology company (portfolio average weight of 0.23%), and Zale Corp., a consumer discretionary company (portfolio average weight of 0.28%). Positions that detracted most significantly from the Fund’s return included Tower Group International Ltd., a financials company (portfolio average weight of 0.08%), and Furniture Brands International, Inc., a consumer discretionary company (portfolio average weight of 0.01%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 21.2 | |||
Consumer Discretionary | 17.4 | |||
Industrials | 16.8 | |||
Information Technology | 16.2 | |||
Energy | 8.0 | |||
Health Care | 7.4 | |||
Materials | 6.1 | |||
Consumer Staples | 4.0 | |||
Utilities | 1.6 | |||
Telecommunication Services | 1.3 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Matson, Inc. | 0.6 | |||
Stone Energy Corp. | 0.2 | |||
Susser Holdings Corp. | 0.2 | |||
Axiall Corp. | 0.2 | |||
CDW Corp. | 0.2 | |||
ANN, Inc. | 0.2 | |||
Fresh Del Monte Produce, Inc. | 0.2 | |||
Atlas Air Worldwide Holdings, Inc. | 0.2 | |||
Asbury Automotive Group, Inc. | 0.2 | |||
Anworth Mortgage Asset Corp. | 0.2 | |||
Total | 2.4 |
| 12 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
Index | 1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | ||||||||||||||||||||||||
Avg. Ann.†† | Cumulative | |||||||||||||||||||||||||||||
FTSE RAFI US 1500 Small-Mid Index | 25.50 | % | 12.53 | % | 42.48 | % | 23.97 | % | 192.82 | % | 10.22 | % | 109.69 | % | ||||||||||||||||
Russell 2000® Index | 20.50 | 10.74 | 35.79 | 19.84 | 147.15 | 7.24 | 70.29 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 25.22 | 12.30 | 41.63 | 23.79 | 190.64 | 9.95 | 105.75 | |||||||||||||||||||||||
Market Price Return | 25.40 | 12.32 | 41.71 | 23.84 | 191.25 | 9.95 | 105.81 |
Fund Inception: September 20, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.43%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 13 |
|
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—19.2% | ||||||||
444 | Amazon.com, Inc.(b) | $ | 135,034 | |||||
7,600 | Caesars Entertainment Corp.(b) | 140,372 | ||||||
3,147 | Cheesecake Factory, Inc. (The) | 141,269 | ||||||
2,092 | DIRECTV(b) | 162,339 | ||||||
3,254 | Fiesta Restaurant Group, Inc.(b) | 119,129 | ||||||
8,083 | Liberty Interactive Corp., Class A(b) | 234,892 | ||||||
5,005 | Loral Space & Communications, Inc.(b) | 360,310 | ||||||
9,721 | Melco Crown Entertainment Ltd. ADR (Hong Kong) | 332,264 | ||||||
3,478 | Monro Muffler Brake, Inc. | 196,159 | ||||||
781 | Netflix, Inc.(b) | 251,513 | ||||||
1,201 | O’Reilly Automotive, Inc.(b) | 178,697 | ||||||
9,608 | Papa John’s International, Inc. | 421,407 | ||||||
574 | Priceline Group, Inc. (The)(b) | 664,548 | ||||||
2,574 | Rentrak Corp.(b) | 146,692 | ||||||
23,807 | Starz, Class A(b) | 768,252 | ||||||
1,603 | Tesla Motors, Inc.(b) | 333,248 | ||||||
10,870 | Tuesday Morning Corp.(b) | 151,962 | ||||||
982 | Wynn Resorts Ltd. | 200,220 | ||||||
|
| |||||||
4,938,307 | ||||||||
|
| |||||||
Consumer Staples—2.0% | ||||||||
1,759 | Hain Celestial Group, Inc. (The)(b) | 151,309 | ||||||
1,951 | Keurig Green Mountain, Inc. | 182,770 | ||||||
8,487 | Pilgrim’s Pride Corp. (Brazil)(b) | 185,526 | ||||||
|
| |||||||
519,605 | ||||||||
|
| |||||||
Energy—2.5% | ||||||||
11,695 | Green Plains Renewable Energy, Inc. | 349,680 | ||||||
2,253 | Gulfport Energy Corp.(b) | 165,979 | ||||||
2,776 | RigNet, Inc.(b) | 129,806 | ||||||
|
| |||||||
645,465 | ||||||||
|
| |||||||
Financials—4.3% | ||||||||
3,913 | Bank of the Ozarks, Inc. | 234,389 | ||||||
5,590 | BofI Holding, Inc.(b) | 450,610 | ||||||
4,588 | East West Bancorp, Inc. | 158,332 | ||||||
1,279 | SVB Financial Group(b) | 136,456 | ||||||
2,371 | Texas Capital Bancshares, Inc.(b) | 133,226 | ||||||
|
| |||||||
1,113,013 | ||||||||
|
| |||||||
Health Care—38.1% | ||||||||
23,870 | ACADIA Pharmaceuticals, Inc.(b) | 480,503 | ||||||
38,665 | Accelerate Diagnostics, Inc.(b) | 712,596 | ||||||
3,632 | Air Methods Corp.(b) | 202,193 | ||||||
1,176 | Alexion Pharmaceuticals, Inc.(b) | 186,043 | ||||||
11,999 | Anacor Pharmaceuticals, Inc.(b) | 197,624 | ||||||
1,185 | athenahealth, Inc.(b) | 146,513 | ||||||
1,107 | Atrion Corp. | 319,181 | ||||||
566 | Biogen Idec, Inc.(b) | 162,510 | ||||||
4,467 | Cardiovascular Systems, Inc.(b) | 128,426 | ||||||
8,565 | Cerner Corp.(b) | 439,385 | ||||||
2,994 | Clovis Oncology, Inc.(b) | 161,886 | ||||||
4,430 | DexCom, Inc.(b) | 143,709 | ||||||
17,544 | Dyax Corp.(b) | 115,966 | ||||||
11,451 | Gilead Sciences, Inc.(b) | 898,789 | ||||||
5,971 | Henry Schein, Inc.(b) | 682,067 | ||||||
1,262 | IDEXX Laboratories, Inc.(b) | 159,567 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
1,194 | Illumina, Inc.(b) | $ | 162,205 | |||||
2,637 | Incyte Corp.(b) | 128,053 | ||||||
3,963 | Insys Therapeutics, Inc.(b) | 162,721 | ||||||
1,652 | Intercept Pharmaceuticals, Inc.(b) | 436,326 | ||||||
4,449 | InterMune, Inc.(b) | 142,724 | ||||||
5,985 | Jazz Pharmaceuticals PLC(b) | 807,377 | ||||||
31,204 | Keryx Biopharmaceuticals, Inc.(b) | 460,883 | ||||||
4,281 | Ligand Pharmaceuticals, Inc.(b) | 270,431 | ||||||
3,107 | Mylan, Inc.(b) | 157,774 | ||||||
5,575 | Pacira Pharmaceuticals, Inc.(b) | 381,832 | ||||||
7,378 | Prothena Corp. PLC (Ireland)(b) | 162,316 | ||||||
1,724 | Regeneron Pharmaceuticals, Inc.(b) | 511,838 | ||||||
13,384 | Sangamo BioSciences, Inc.(b) | 185,235 | ||||||
3,055 | Seattle Genetics, Inc.(b) | 117,556 | ||||||
7,213 | Spectranetics Corp. (The)(b) | 153,348 | ||||||
17,088 | Trinity Biotech PLC ADR (Ireland) | 418,827 | ||||||
|
| |||||||
9,796,404 | ||||||||
|
| |||||||
Industrials—9.6% | ||||||||
4,826 | Altra Industrial Motion Corp. | 164,856 | ||||||
730 | AMERCO | 182,580 | ||||||
2,099 | American Railcar Industries, Inc. | 145,754 | ||||||
5,005 | ArcBest Corp. | 197,297 | ||||||
4,480 | Astronics Corp.(b) | 255,898 | ||||||
3,181 | Avis Budget Group, Inc.(b) | 167,289 | ||||||
2,832 | B/E Aerospace, Inc.(b) | 248,565 | ||||||
6,072 | H&E Equipment Services, Inc.(b) | 234,076 | ||||||
753 | Middleby Corp. (The)(b) | 190,117 | ||||||
2,377 | Power Solutions International, Inc.(b) | 196,697 | ||||||
5,154 | Primoris Services Corp. | 144,209 | ||||||
4,516 | Saia, Inc.(b) | 185,924 | ||||||
9,034 | TASER International, Inc.(b) | 145,899 | ||||||
|
| |||||||
2,459,161 | ||||||||
|
| |||||||
Information Technology—23.6% | ||||||||
6,311 | Ambarella Inc.(b) | 156,828 | ||||||
1,485 | Apple, Inc. | 876,284 | ||||||
6,037 | ARM Holdings PLC ADR (United Kingdom) | 274,804 | ||||||
2,060 | Baidu, Inc. ADR (China)(b) | 316,931 | ||||||
15,101 | CalAmp Corp.(b) | 268,043 | ||||||
3,772 | Concur Technologies, Inc.(b) | 303,533 | ||||||
780 | CoStar Group, Inc.(b) | 125,494 | ||||||
5,791 | Cray, Inc.(b) | 166,259 | ||||||
1,565 | FEI Co. | 124,449 | ||||||
2,620 | First Solar, Inc.(b) | 176,824 | ||||||
14,985 | GT Advanced Technologies, Inc.(b) | 248,901 | ||||||
34,617 | Himax Technologies, Inc. ADR (Taiwan) | 301,860 | ||||||
2,290 | IPG Photonics Corp.(b) | 148,003 | ||||||
1,772 | Littelfuse, Inc. | 160,454 | ||||||
5,626 | Manhattan Associates, Inc.(b) | 177,388 | ||||||
7,505 | Measurement Specialties, Inc.(b) | 482,947 | ||||||
6,687 | Micron Technology, Inc.(b) | 174,664 | ||||||
2,939 | Seagate Technology PLC | 154,533 | ||||||
4,607 | Skyworks Solutions, Inc.(b) | 189,117 | ||||||
11,295 | SunPower Corp. (France)(b) | 377,479 | ||||||
4,753 | Ubiquiti Networks, Inc.(b) | 184,084 | ||||||
1,622 | Ultimate Software Group, Inc. (The)(b) | 194,040 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 14 |
|
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
4,291 | Web.com Group, Inc.(b) | $ | 131,777 | |||||
3,507 | YY, Inc. ADR (China)(b) | 201,161 | ||||||
1,529 | Zillow, Inc., Class A(b) | 166,202 | ||||||
|
| |||||||
6,082,059 | ||||||||
|
| |||||||
Materials—0.7% | ||||||||
3,008 | Methanex Corp. (Canada) | 186,496 | ||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $27,966,388) | 25,740,510 | |||||||
|
| |||||||
Money Market Fund—0.2% | ||||||||
47,779 | Invesco Premier Portfolio—Institutional Class(c) (Cost $47,779) | 47,779 | ||||||
|
| |||||||
Total Investments (Cost $28,014,167)—100.2% | 25,788,289 | |||||||
Other assets less liabilities—(0.2)% | (53,961 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 25,734,328 | ||||||
|
|
Investment Abbreviations:
ADR—American Depositary Receipt
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 15 |
|
Schedule of Investments(a)
PowerShares Dynamic Market Portfolio (PWC)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—13.5% | ||||||||
6,111 | Advance Auto Parts, Inc. | $ | 741,203 | |||||
23,354 | Apollo Education Group, Inc.(b) | 673,996 | ||||||
14,153 | Brinker International, Inc. | 695,478 | ||||||
58,512 | DIRECTV(b) | 4,540,531 | ||||||
77,167 | DISH Network Corp., Class A(b) | 4,387,716 | ||||||
28,968 | Goodyear Tire & Rubber Co. (The) | 729,994 | ||||||
7,432 | Harman International Industries, Inc. | 814,622 | ||||||
25,085 | ITT Educational Services, Inc.(b) | 677,295 | ||||||
78,474 | Macy’s, Inc. | 4,506,762 | ||||||
46,318 | Michael Kors Holdings Ltd.(b) | 4,224,202 | ||||||
52,629 | Modine Manufacturing Co.(b) | 867,326 | ||||||
47,403 | New York Times Co. (The), Class A | 762,240 | ||||||
11,004 | Outerwall, Inc.(b) | 763,127 | ||||||
81,249 | Wendy’s Co. (The) | 675,179 | ||||||
|
| |||||||
25,059,671 | ||||||||
|
| |||||||
Consumer Staples—9.1% | ||||||||
14,688 | Andersons, Inc. (The) | 914,916 | ||||||
138,873 | Archer-Daniels-Midland Co. | 6,072,916 | ||||||
9,940 | Constellation Brands, Inc., Class A(b) | 793,610 | ||||||
77,088 | CVS Caremark Corp. | 5,605,840 | ||||||
28,044 | Diamond Foods, Inc.(b) | 857,305 | ||||||
9,645 | Nu Skin Enterprises, Inc., Class A | 839,115 | ||||||
45,948 | Pilgrim’s Pride Corp. (Brazil)(b) | 1,004,423 | ||||||
35,656 | Spartan Stores, Inc. | 768,030 | ||||||
|
| |||||||
16,856,155 | ||||||||
|
| |||||||
Energy—12.3% | ||||||||
15,601 | Helmerich & Payne, Inc. | 1,695,049 | ||||||
214,606 | Marathon Oil Corp. | 7,758,007 | ||||||
47,593 | Matrix Service Co.(b) | 1,473,955 | ||||||
75,297 | Midcoast Energy Partners LP | 1,647,498 | ||||||
149,839 | Valero Energy Corp. | 8,566,296 | ||||||
42,264 | Western Refining, Inc. | 1,838,484 | ||||||
|
| |||||||
22,979,289 | ||||||||
|
| |||||||
Financials—13.9% | ||||||||
18,867 | AMBAC Financial Group, Inc.(b) | 569,406 | ||||||
11,407 | American Financial Group, Inc. | 666,511 | ||||||
17,360 | Aspen Insurance Holdings Ltd. | 794,741 | ||||||
9,935 | Assurant, Inc. | 669,718 | ||||||
27,248 | BancorpSouth, Inc. | 636,513 | ||||||
33,050 | Central Pacific Financial Corp. | 620,349 | ||||||
114,785 | Charles Schwab Corp. (The) | 3,047,542 | ||||||
73,342 | CNA Financial Corp. | 3,003,355 | ||||||
140,260 | Fifth Third Bancorp | 2,890,759 | ||||||
60,702 | Lincoln National Corp. | 2,944,654 | ||||||
12,147 | LPL Financial Holdings, Inc. | 575,160 | ||||||
41,907 | Old Republic International Corp. | 693,980 | ||||||
6,594 | PartnerRe Ltd. | 695,008 | ||||||
285,991 | Regions Financial Corp. | 2,899,949 | ||||||
9,853 | StanCorp Financial Group, Inc. | 602,018 | ||||||
33,100 | Symetra Financial Corp. | 683,846 | ||||||
36,295 | Travelers Cos., Inc. (The) | 3,287,601 | ||||||
39,069 | United Community Banks, Inc.(b) | 630,964 | ||||||
|
| |||||||
25,912,074 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care—12.6% | ||||||||
14,589 | AmSurg Corp.(b) | $ | 631,850 | |||||
28,482 | C.R. Bard, Inc. | 3,911,433 | ||||||
57,402 | Cardinal Health, Inc. | 3,990,013 | ||||||
51,588 | Cigna Corp. | 4,129,104 | ||||||
13,907 | Corvel Corp.(b) | 633,325 | ||||||
17,588 | ExamWorks Group, Inc.(b) | 647,238 | ||||||
36,510 | Humana, Inc. | 4,006,972 | ||||||
24,830 | Impax Laboratories, Inc.(b) | 649,304 | ||||||
10,466 | Magellan Health Services, Inc.(b) | 604,098 | ||||||
10,520 | MEDNAX, Inc.(b) | 623,310 | ||||||
17,671 | Myriad Genetics, Inc.(b) | 745,893 | ||||||
74,665 | PDL BioPharma, Inc. | 633,906 | ||||||
26,550 | PharMerica Corp.(b) | 721,894 | ||||||
10,532 | Questcor Pharmaceuticals, Inc. | 865,520 | ||||||
6,309 | United Therapeutics Corp.(b) | 630,963 | ||||||
|
| |||||||
23,424,823 | ||||||||
|
| |||||||
Industrials—11.1% | ||||||||
8,965 | Alaska Air Group, Inc. | 843,427 | ||||||
23,351 | ArcBest Corp. | 920,497 | ||||||
18,612 | Engility Holdings, Inc.(b) | 812,228 | ||||||
38,015 | Exelis, Inc. | 704,798 | ||||||
7,664 | Huntington Ingalls Industries, Inc. | 789,392 | ||||||
87,956 | JetBlue Airways Corp.(b) | 695,292 | ||||||
41,378 | Kimball International, Inc., Class B | 693,495 | ||||||
41,876 | L-3 Communications Holdings, Inc. | 4,831,234 | ||||||
39,927 | Northrop Grumman Corp. | 4,851,530 | ||||||
49,357 | Raytheon Co. | 4,712,606 | ||||||
48,479 | RPX Corp.(b) | 794,086 | ||||||
|
| |||||||
20,648,585 | ||||||||
|
| |||||||
Information Technology—18.5% | ||||||||
17,186 | Alliance Data Systems Corp.(b) | 4,157,293 | ||||||
25,278 | Broadridge Financial Solutions, Inc. | 969,158 | ||||||
99,738 | Brocade Communications Systems, Inc.(b) | 928,561 | ||||||
46,744 | CTS Corp. | 831,576 | ||||||
106,648 | Flextronics International Ltd.(b) | 958,766 | ||||||
12,931 | Harris Corp. | 950,687 | ||||||
163,982 | Hewlett-Packard Co. | 5,421,245 | ||||||
32,412 | Ingram Micro, Inc., Class A(b) | 873,827 | ||||||
16,419 | Jack Henry & Associates, Inc. | 905,672 | ||||||
183,239 | Juniper Networks, Inc.(b) | 4,524,171 | ||||||
22,651 | Lexmark International, Inc., Class A | 973,993 | ||||||
25,192 | Manhattan Associates, Inc.(b) | 794,304 | ||||||
202,555 | Micron Technology, Inc.(b) | 5,290,737 | ||||||
23,196 | Plexus Corp.(b) | 972,376 | ||||||
48,281 | Take-Two Interactive Software, Inc.(b) | 983,967 | ||||||
56,325 | Western Digital Corp. | 4,963,922 | ||||||
|
| |||||||
34,500,255 | ||||||||
|
| |||||||
Materials—3.8% | ||||||||
6,509 | Domtar Corp. | 607,680 | ||||||
103,292 | Mosaic Co. (The) | 5,168,732 | ||||||
14,360 | Neenah Paper, Inc. | 723,313 | ||||||
9,890 | Packaging Corp. of America | 658,971 | ||||||
|
| |||||||
7,158,696 | ||||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 16 |
|
PowerShares Dynamic Market Portfolio (PWC) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Telecommunication Services—2.3% | ||||||||
44,029 | AT&T, Inc. | $ | 1,571,835 | |||||
10,540 | Cogent Communications Group, Inc. | 363,314 | ||||||
21,074 | Consolidated Communications Holdings, Inc. | 419,794 | ||||||
82,308 | Frontier Communications Corp. | 489,733 | ||||||
29,547 | Verizon Communications, Inc. | 1,380,731 | ||||||
|
| |||||||
4,225,407 | ||||||||
|
| |||||||
Utilities—2.9% | ||||||||
57,596 | AES Corp. (The) | 832,262 | ||||||
13,863 | Black Hills Corp. | 800,588 | ||||||
51,761 | Duke Energy Corp. | 3,855,677 | ||||||
|
| |||||||
5,488,527 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $179,962,290) | 186,253,482 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
16,067 | Invesco Premier Portfolio—Institutional Class(c) (Cost $16,067) | 16,067 | ||||||
|
| |||||||
Total Investments (Cost $179,978,357)—100.0% | 186,269,549 | |||||||
Other assets less liabilities—(0.0)% | (50,738 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 186,218,811 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 17 |
|
Schedule of Investments(a)
PowerShares FTSE RAFI US 1000 Portfolio (PRF)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—10.5% | ||||||||
17,073 | Aaron’s, Inc. | $ | 503,141 | |||||
24,826 | Abercrombie & Fitch Co., Class A | 912,604 | ||||||
7,474 | Advance Auto Parts, Inc. | 906,521 | ||||||
13,766 | Amazon.com, Inc.(b) | 4,186,654 | ||||||
70,459 | American Eagle Outfitters, Inc. | 814,506 | ||||||
33,249 | Apollo Education Group, Inc.(b) | 959,566 | ||||||
24,034 | Ascena Retail Group, Inc.(b) | 413,385 | ||||||
17,072 | Autoliv, Inc. | 1,741,003 | ||||||
10,358 | AutoNation, Inc.(b) | 548,870 | ||||||
3,071 | AutoZone, Inc.(b) | 1,639,576 | ||||||
30,815 | Barnes & Noble, Inc.(b) | 505,366 | ||||||
35,084 | Bed Bath & Beyond, Inc.(b) | 2,179,769 | ||||||
189,037 | Best Buy Co., Inc. | 4,901,729 | ||||||
29,813 | Big Lots, Inc.(b) | 1,177,613 | ||||||
18,775 | BorgWarner, Inc. | 1,166,678 | ||||||
10,860 | Brinker International, Inc. | 533,660 | ||||||
6,156 | Cabela’s, Inc.(b) | 403,895 | ||||||
79,249 | Cablevision Systems Corp., Class A | 1,323,458 | ||||||
32,794 | Caesars Entertainment Corp.(b)(c) | 605,705 | ||||||
62,602 | Career Education Corp.(b) | 451,986 | ||||||
34,843 | CarMax, Inc.(b) | 1,525,427 | ||||||
98,274 | Carnival Corp. | 3,863,151 | ||||||
5,826 | Carter’s, Inc. | 429,143 | ||||||
865 | CBS Corp., Class A | 50,300 | ||||||
59,702 | CBS Corp., Class B- Non Voting, Class B | 3,448,388 | ||||||
12,529 | Charter Communications, Inc., Class A(b) | 1,698,055 | ||||||
22,882 | Chico’s FAS, Inc. | 363,366 | ||||||
1,098 | Chipotle Mexican Grill, Inc.(b) | 547,353 | ||||||
22,988 | Cinemark Holdings, Inc. | 680,905 | ||||||
30,436 | Coach, Inc. | 1,358,967 | ||||||
378,255 | Comcast Corp., Class A | 19,528,456 | ||||||
22,824 | Cooper Tire & Rubber Co. | 574,024 | ||||||
51,258 | CST Brands, Inc. | 1,672,549 | ||||||
35,982 | D.R. Horton, Inc. | 801,679 | ||||||
40,977 | Dana Holding Corp. | 867,483 | ||||||
34,715 | Darden Restaurants, Inc. | 1,725,683 | ||||||
36,193 | Delphi Automotive PLC (United Kingdom) | 2,419,140 | ||||||
9,865 | DeVry Education Group, Inc. | 444,221 | ||||||
12,219 | Dick’s Sporting Goods, Inc. | 643,453 | ||||||
8,303 | Dillard’s, Inc., Class A | 813,113 | ||||||
81,777 | DIRECTV(b) | 6,345,895 | ||||||
11,579 | Discovery Communications, Inc., Class A(b) | 878,846 | ||||||
40 | Discovery Communications, Inc., Class B(b) | 3,005 | ||||||
6,350 | Discovery Communications, Inc., Class C(b) | 445,325 | ||||||
28,496 | DISH Network Corp., Class A(b) | 1,620,283 | ||||||
37,110 | Dollar General Corp.(b) | 2,094,488 | ||||||
25,167 | Dollar Tree, Inc.(b) | 1,310,446 | ||||||
10,630 | Expedia, Inc. | 754,624 | ||||||
21,911 | Express, Inc.(b) | 319,243 | ||||||
15,958 | Family Dollar Stores, Inc. | 937,532 | ||||||
28,004 | Foot Locker, Inc. | 1,303,026 | ||||||
1,071,950 | Ford Motor Co. | 17,311,992 | ||||||
4,681 | Fossil Group, Inc.(b) | 499,229 | ||||||
37,554 | GameStop Corp., Class A | 1,490,143 | ||||||
54,608 | Gannett Co., Inc. | 1,483,699 | ||||||
41,464 | Gap, Inc. (The) | 1,629,535 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
18,646 | Garmin Ltd.(c) | $ | 1,064,687 | |||||
457,084 | General Motors Co. | 15,760,256 | ||||||
5,716 | Genesco, Inc.(b) | 436,531 | ||||||
14,845 | Gentex Corp. | 425,606 | ||||||
27,210 | Genuine Parts Co. | 2,370,535 | ||||||
8,781 | GNC Holdings, Inc., Class A | 395,145 | ||||||
106,896 | Goodyear Tire & Rubber Co. (The) | 2,693,779 | ||||||
1,054 | Graham Holdings Co., Class B | 707,476 | ||||||
9,623 | Group 1 Automotive, Inc. | 694,107 | ||||||
20,896 | Guess?, Inc. | 562,311 | ||||||
40,118 | H&R Block, Inc. | 1,140,154 | ||||||
11,503 | Hanesbrands, Inc. | 944,281 | ||||||
24,470 | Harley-Davidson, Inc. | 1,809,312 | ||||||
5,532 | Harman International Industries, Inc. | 606,363 | ||||||
19,830 | Hasbro, Inc. | 1,095,806 | ||||||
194,651 | Home Depot, Inc. (The) | 15,476,701 | ||||||
61,821 | International Game Technology | 775,854 | ||||||
70,558 | Interpublic Group of Cos., Inc. (The) | 1,229,120 | ||||||
12,011 | ITT Educational Services, Inc.(b)(c) | 324,297 | ||||||
447,234 | J.C. Penney Co., Inc.(b)(c) | 3,810,434 | ||||||
14,866 | Jarden Corp.(b) | 849,592 | ||||||
6,609 | John Wiley & Sons, Inc., Class A | 379,753 | ||||||
121,652 | Johnson Controls, Inc. | 5,491,371 | ||||||
62,655 | Kohl’s Corp. | 3,432,867 | ||||||
55,324 | L Brands, Inc. | 2,998,561 | ||||||
8,942 | Lamar Advertising Co., Class A(b) | 446,385 | ||||||
14,115 | Lands’ End, Inc.(b)(c) | 390,280 | ||||||
23,335 | Las Vegas Sands Corp. | 1,846,499 | ||||||
21,178 | Lear Corp. | 1,759,045 | ||||||
33,789 | Leggett & Platt, Inc. | 1,110,307 | ||||||
14,595 | Lennar Corp., Class A | 563,221 | ||||||
863 | Lennar Corp., Class B | 28,065 | ||||||
45,382 | Liberty Global PLC, Class A (United Kingdom)(b) | 1,807,111 | ||||||
295 | Liberty Global PLC, Class B (United Kingdom)(b) | 11,785 | ||||||
35,366 | Liberty Global PLC, Class C, Series C (United Kingdom)(b) | 1,359,115 | ||||||
96,052 | Liberty Interactive Corp., Class A(b) | 2,791,271 | ||||||
330 | Liberty Interactive Corp., Class B(b) | 9,557 | ||||||
7,643 | Liberty Media Corp., Class A(b) | 991,374 | ||||||
46 | Liberty Media Corp., Class B(b) | 5,815 | ||||||
33,110 | Live Nation Entertainment, Inc.(b) | 691,337 | ||||||
23,812 | LKQ Corp.(b) | 693,405 | ||||||
194,107 | Lowe’s Cos., Inc. | 8,911,452 | ||||||
83,657 | Macy’s, Inc. | 4,804,422 | ||||||
23,437 | Marriott International, Inc., Class A | 1,357,705 | ||||||
59,385 | Mattel, Inc. | 2,328,783 | ||||||
149,707 | McDonald’s Corp. | 15,177,296 | ||||||
9,003 | Men’s Wearhouse, Inc. (The) | 426,562 | ||||||
52,327 | MGM Resorts International(b) | 1,320,210 | ||||||
8,817 | Mohawk Industries, Inc.(b) | 1,167,459 | ||||||
51,462 | Murphy USA, Inc.(b) | 2,187,135 | ||||||
1,062 | Netflix, Inc.(b) | 342,006 | ||||||
42,544 | Newell Rubbermaid, Inc. | 1,281,000 | ||||||
102,220 | News Corp., Class A(b) | 1,739,784 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 18 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
29,305 | News Corp., Class B(b) | $ | 484,705 | |||||
50,367 | NIKE, Inc., Class B | 3,674,273 | ||||||
26,912 | Nordstrom, Inc. | 1,649,167 | ||||||
567 | NVR, Inc.(b) | 610,659 | ||||||
254,069 | Office Depot, Inc.(b) | 1,039,142 | ||||||
40,083 | Omnicom Group, Inc. | 2,712,817 | ||||||
8,592 | O’Reilly Automotive, Inc.(b) | 1,278,404 | ||||||
2,264 | Panera Bread Co., Class A(b) | 346,324 | ||||||
60,149 | Penn National Gaming, Inc.(b) | 671,263 | ||||||
13,691 | Penske Automotive Group, Inc. | 627,869 | ||||||
15,709 | PetSmart, Inc. | 1,063,185 | ||||||
4,082 | Polaris Industries, Inc. | 548,335 | ||||||
1,168 | Priceline Group, Inc. (The)(b) | 1,352,252 | ||||||
24,549 | PulteGroup, Inc. | 451,456 | ||||||
7,085 | PVH Corp. | 889,663 | ||||||
248,319 | RadioShack Corp.(b)(c) | 355,096 | ||||||
6,313 | Ralph Lauren Corp. | 955,599 | ||||||
30,286 | Regal Entertainment Group, Class A(c) | 569,377 | ||||||
34,887 | Rent-A-Center, Inc. | 1,019,049 | ||||||
21,711 | Ross Stores, Inc. | 1,478,085 | ||||||
29,338 | Royal Caribbean Cruises Ltd. | 1,558,728 | ||||||
18,223 | Sally Beauty Holdings, Inc.(b) | 499,492 | ||||||
6,244 | Scripps Networks Interactive, Inc., Class A | 468,737 | ||||||
46,828 | Sears Holdings Corp.(b)(c) | 2,051,535 | ||||||
14,568 | SeaWorld Entertainment, Inc. | 437,914 | ||||||
35,455 | Service Corp. International | 665,490 | ||||||
9,349 | Signet Jewelers Ltd. | 947,241 | ||||||
152,750 | Sirius XM Holdings, Inc.(b) | 487,273 | ||||||
9,933 | Six Flags Entertainment Corp. | 398,711 | ||||||
22,873 | Sonic Automotive, Inc., Class A | 556,729 | ||||||
308,131 | Staples, Inc. | 3,851,638 | ||||||
38,266 | Starbucks Corp. | 2,702,345 | ||||||
18,790 | Starwood Hotels & Resorts Worldwide, Inc. | 1,440,254 | ||||||
212,186 | Target Corp. | 13,102,486 | ||||||
15,451 | Tenneco, Inc.(b) | 925,051 | ||||||
7,189 | Thor Industries, Inc. | 437,594 | ||||||
12,126 | Tiffany & Co. | 1,060,904 | ||||||
46,282 | Time Warner Cable, Inc. | 6,547,052 | ||||||
167,819 | Time Warner, Inc. | 11,153,251 | ||||||
65,720 | TJX Cos., Inc. (The) | 3,823,590 | ||||||
15,310 | Toll Brothers, Inc.(b) | 524,214 | ||||||
6,875 | Tractor Supply Co. | 462,275 | ||||||
33,498 | TRW Automotive Holdings Corp.(b) | 2,691,564 | ||||||
6,730 | Tupperware Brands Corp. | 571,444 | ||||||
170,269 | Twenty-First Century Fox, Inc., Class A | 5,452,013 | ||||||
49,912 | Twenty-First Century Fox, Inc., Class B | 1,563,244 | ||||||
14,215 | Urban Outfitters, Inc.(b) | 506,836 | ||||||
34,479 | VF Corp. | 2,106,322 | ||||||
1,064 | Viacom, Inc., Class A | 90,408 | ||||||
41,255 | Viacom, Inc., Class B | 3,505,850 | ||||||
14,790 | Visteon Corp.(b) | 1,283,920 | ||||||
167,636 | Walt Disney Co. (The) | 13,300,240 | ||||||
50,911 | Wendy’s Co. (The) | 423,070 | ||||||
20,362 | Whirlpool Corp. | 3,123,124 | ||||||
10,736 | Williams-Sonoma, Inc. | 674,436 | ||||||
16,341 | Wyndham Worldwide Corp. | 1,165,767 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
9,236 | Wynn Resorts Ltd. | $ | 1,883,128 | |||||
47,524 | Yum! Brands, Inc. | 3,658,873 | ||||||
|
| |||||||
346,660,600 | ||||||||
|
| |||||||
Consumer Staples—10.0% | ||||||||
386,714 | Altria Group, Inc. | 15,511,099 | ||||||
8,009 | Andersons, Inc. (The) | 498,881 | ||||||
251,580 | Archer-Daniels-Midland Co. | 11,001,593 | ||||||
164,024 | Avon Products, Inc. | 2,506,287 | ||||||
130 | Beam, Inc. (Japan) | 10,851 | ||||||
6,059 | Brown-Forman Corp., Class A | 540,039 | ||||||
13,404 | Brown-Forman Corp., Class B | 1,202,607 | ||||||
74,546 | Bunge Ltd. | 5,937,589 | ||||||
31,427 | Campbell Soup Co. | 1,429,614 | ||||||
10,139 | Casey’s General Stores, Inc. | 696,144 | ||||||
36,240 | Chiquita Brands International, Inc.(b) | 416,035 | ||||||
12,531 | Church & Dwight Co., Inc. | 864,764 | ||||||
19,643 | Clorox Co. (The) | 1,781,620 | ||||||
581,632 | Coca-Cola Co. (The) | 23,724,769 | ||||||
43,667 | Coca-Cola Enterprises, Inc. | 1,984,228 | ||||||
100,700 | Colgate-Palmolive Co. | 6,777,110 | ||||||
116,200 | ConAgra Foods, Inc. | 3,545,262 | ||||||
11,528 | Constellation Brands, Inc., Class A(b) | 920,395 | ||||||
100 | Constellation Brands, Inc., Class B(b) | 7,654 | ||||||
85,358 | Costco Wholesale Corp. | 9,874,213 | ||||||
236,451 | CVS Caremark Corp. | 17,194,717 | ||||||
19,481 | Darling International, Inc.(b) | 389,815 | ||||||
107,421 | Dean Foods Co. | 1,701,549 | ||||||
32,883 | Dr Pepper Snapple Group, Inc. | 1,822,376 | ||||||
12,792 | Energizer Holdings, Inc. | 1,428,738 | ||||||
16,175 | Estee Lauder Cos., Inc. (The), Class A | 1,173,820 | ||||||
25,236 | Flowers Foods, Inc. | 517,843 | ||||||
110,084 | General Mills, Inc. | 5,836,654 | ||||||
10,636 | Herbalife Ltd.(c) | 637,947 | ||||||
12,774 | Hershey Co. (The) | 1,229,370 | ||||||
53,292 | Hillshire Brands Co. (The) | 1,899,860 | ||||||
16,969 | Hormel Foods Corp. | 809,252 | ||||||
14,895 | Ingredion, Inc. | 1,049,353 | ||||||
20,371 | J.M. Smucker Co. (The) | 1,969,468 | ||||||
43,068 | Kellogg Co. | 2,878,234 | ||||||
5,176 | Keurig Green Mountain, Inc. | 484,888 | ||||||
60,445 | Kimberly-Clark Corp. | 6,784,951 | ||||||
62,072 | Kraft Foods Group, Inc. | 3,529,414 | ||||||
216,973 | Kroger Co. (The) | 9,989,437 | ||||||
65,361 | Lorillard, Inc. | 3,883,751 | ||||||
802 | McCormick & Co., Inc. | 57,479 | ||||||
15,173 | McCormick & Co., Inc., Non-Voting | 1,080,318 | ||||||
13,092 | Mead Johnson Nutrition Co. | 1,155,500 | ||||||
25,722 | Molson Coors Brewing Co., Class B | 1,542,548 | ||||||
440,524 | Mondelez International, Inc., Class A | 15,704,681 | ||||||
252,175 | PepsiCo, Inc. | 21,659,311 | ||||||
262,132 | Philip Morris International, Inc. | 22,393,937 | ||||||
465,009 | Procter & Gamble Co. (The) | 38,386,493 | ||||||
66,538 | Reynolds American, Inc. | 3,754,739 | ||||||
326,321 | Rite Aid Corp.(b) | 2,382,143 | ||||||
136,350 | Safeway, Inc. | 4,644,081 | ||||||
423,404 | SUPERVALU, Inc.(b) | 2,959,594 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 19 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Staples (continued) | ||||||||
167,872 | Sysco Corp. | $ | 6,115,577 | |||||
6,815 | TreeHouse Foods, Inc.(b) | 510,035 | ||||||
75,773 | Tyson Foods, Inc., Class A | 3,180,193 | ||||||
7,914 | United Natural Foods, Inc.(b) | 546,303 | ||||||
9,932 | Universal Corp. | 541,989 | ||||||
148,997 | Walgreen Co. | 10,116,896 | ||||||
463,738 | Wal-Mart Stores, Inc. | 36,964,556 | ||||||
13,748 | WhiteWave Foods Co. (The), Class A(b) | 380,682 | ||||||
27,466 | Whole Foods Market, Inc. | 1,365,060 | ||||||
|
| |||||||
329,884,306 | ||||||||
|
| |||||||
Energy—13.3% | ||||||||
299,363 | Alpha Natural Resources, Inc.(b)(c) | 1,287,261 | ||||||
76,666 | Anadarko Petroleum Corp. | 7,591,467 | ||||||
94,555 | Apache Corp. | 8,207,374 | ||||||
247,626 | Arch Coal, Inc.(c) | 1,134,127 | ||||||
11,105 | Atwood Oceanics, Inc.(b) | 550,364 | ||||||
77,981 | Baker Hughes, Inc. | 5,450,872 | ||||||
18,193 | Bill Barrett Corp.(b) | 430,810 | ||||||
15,847 | Cabot Oil & Gas Corp. | 622,470 | ||||||
33,765 | Cameron International Corp.(b) | 2,193,374 | ||||||
174,363 | Chesapeake Energy Corp. | 5,012,936 | ||||||
580,815 | Chevron Corp. | 72,903,899 | ||||||
8,335 | Cimarex Energy Co. | 992,865 | ||||||
25,497 | Cloud Peak Energy, Inc.(b) | 502,036 | ||||||
7,936 | Concho Resources, Inc.(b) | 1,035,251 | ||||||
503,971 | ConocoPhillips | 37,450,085 | ||||||
39,787 | CONSOL Energy, Inc. | 1,770,919 | ||||||
66,913 | Cosan Ltd., Class A (Brazil) | 811,655 | ||||||
12,890 | Delek US Holdings, Inc. (Israel) | 412,351 | ||||||
89,828 | Denbury Resources, Inc. | 1,510,907 | ||||||
98,370 | Devon Energy Corp. | 6,885,900 | ||||||
37,345 | Diamond Offshore Drilling, Inc.(c) | 2,039,410 | ||||||
11,072 | Dresser-Rand Group, Inc.(b) | 669,192 | ||||||
10,548 | Energen Corp. | 821,795 | ||||||
47,643 | Ensco PLC, Class A | 2,403,589 | ||||||
45,078 | EOG Resources, Inc. | 4,417,644 | ||||||
11,838 | EQT Corp. | 1,290,224 | ||||||
19,110 | Exterran Holdings, Inc. | 822,112 | ||||||
1,032,074 | Exxon Mobil Corp. | 105,694,698 | ||||||
22,558 | FMC Technologies, Inc.(b) | 1,279,039 | ||||||
132,641 | Frontline Ltd. (Norway)(b)(c) | 450,979 | ||||||
112,399 | Halliburton Co. | 7,089,005 | ||||||
21,479 | Helix Energy Solutions Group, Inc.(b) | 516,355 | ||||||
10,709 | Helmerich & Payne, Inc. | 1,163,533 | ||||||
88,303 | Hess Corp. | 7,873,096 | ||||||
53,372 | HollyFrontier Corp. | 2,806,833 | ||||||
56,817 | Key Energy Services, Inc.(b) | 570,443 | ||||||
107,037 | Kinder Morgan, Inc. | 3,495,828 | ||||||
276,893 | Marathon Oil Corp. | 10,009,682 | ||||||
87,999 | Marathon Petroleum Corp. | 8,179,507 | ||||||
106,424 | McDermott International, Inc.(b)(c) | 769,446 | ||||||
78,914 | Murphy Oil Corp. | 5,005,515 | ||||||
99,778 | Nabors Industries Ltd. | 2,546,335 | ||||||
71,251 | National Oilwell Varco, Inc. | 5,595,341 | ||||||
48,459 | Newfield Exploration Co.(b) | 1,640,337 | ||||||
71,978 | Noble Corp. PLC | 2,217,642 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Energy (continued) | ||||||||
32,521 | Noble Energy, Inc. | $ | 2,334,357 | |||||
151,169 | Occidental Petroleum Corp. | 14,474,432 | ||||||
8,598 | Oceaneering International, Inc. | 630,061 | ||||||
10,485 | Oil States International, Inc.(b) | 1,018,513 | ||||||
39,083 | ONEOK, Inc. | 2,470,827 | ||||||
28,449 | Patterson-UTI Energy, Inc. | 925,446 | ||||||
16,877 | PBF Energy, Inc., Class A | 519,474 | ||||||
122,075 | Peabody Energy Corp. | 2,320,646 | ||||||
196,080 | Phillips 66 | 16,317,778 | ||||||
6,674 | Pioneer Natural Resources Co. | 1,289,884 | ||||||
33,779 | QEP Resources, Inc. | 1,036,678 | ||||||
7,702 | Range Resources Corp. | 696,646 | ||||||
27,036 | Rowan Cos. PLC, Class A(b) | 835,953 | ||||||
103,753 | SandRidge Energy, Inc.(b)(c) | 711,746 | ||||||
145,197 | Schlumberger Ltd. | 14,744,755 | ||||||
7,616 | SEACOR Holdings, Inc.(b) | 635,098 | ||||||
6,778 | SM Energy Co. | 502,453 | ||||||
33,860 | Southwestern Energy Co.(b) | 1,621,217 | ||||||
114,347 | Spectra Energy Corp. | 4,540,719 | ||||||
36,800 | Superior Energy Services, Inc. | 1,211,456 | ||||||
5,655 | Targa Resources Corp. | 610,683 | ||||||
9,232 | Teekay Corp. (Bermuda) | 518,008 | ||||||
54,041 | Tesoro Corp. | 3,041,968 | ||||||
12,566 | Tidewater, Inc. | 639,986 | ||||||
11,984 | Unit Corp.(b) | 790,345 | ||||||
244,051 | Valero Energy Corp. | 13,952,396 | ||||||
239,059 | Weatherford International Ltd.(b) | 5,020,239 | ||||||
16,655 | Western Refining, Inc.(c) | 724,493 | ||||||
17,397 | Whiting Petroleum Corp.(b) | 1,282,507 | ||||||
88,461 | Williams Cos., Inc. (The) | 3,730,400 | ||||||
38,739 | World Fuel Services Corp. | 1,764,174 | ||||||
107,692 | WPX Energy, Inc.(b) | 2,291,686 | ||||||
|
| |||||||
439,329,527 | ||||||||
|
| |||||||
Financials—20.2% | ||||||||
70,206 | ACE Ltd. | 7,183,478 | ||||||
3,573 | Affiliated Managers Group, Inc.(b) | 708,169 | ||||||
95,949 | Aflac, Inc. | 6,017,921 | ||||||
10,597 | Alexandria Real Estate Equities, Inc. REIT | 782,271 | ||||||
2,630 | Alleghany Corp.(b) | 1,072,987 | ||||||
8,564 | Allied World Assurance Co. Holdings AG | 922,257 | ||||||
122,819 | Allstate Corp. (The) | 6,994,542 | ||||||
16,363 | American Campus Communities, Inc. REIT | 625,067 | ||||||
92,111 | American Capital Agency Corp. REIT | 2,091,841 | ||||||
21,966 | American Capital Mortgage Investment Corp. REIT | 434,927 | ||||||
18,368 | American Equity Investment Life Holding Co. | 428,342 | ||||||
107,463 | American Express Co. | 9,395,490 | ||||||
22,333 | American Financial Group, Inc. | 1,304,917 | ||||||
340,688 | American International Group, Inc. | 18,100,753 | ||||||
15,845 | American Tower Corp. REIT | 1,323,374 | ||||||
25,479 | Ameriprise Financial, Inc. | 2,844,221 | ||||||
513,456 | Annaly Capital Management, Inc. REIT | 5,930,417 | ||||||
32,515 | Aon PLC | 2,759,873 | ||||||
26,998 | Apartment Investment & Management Co., Class A REIT | 832,348 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 20 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
23,360 | Arch Capital Group Ltd.(b) | $ | 1,338,995 | |||||
19,541 | Arthur J. Gallagher & Co. | 879,736 | ||||||
19,602 | Aspen Insurance Holdings Ltd. | 897,380 | ||||||
43,039 | Associated Banc-Corp. | 755,334 | ||||||
28,147 | Assurant, Inc. | 1,897,389 | ||||||
36,237 | Assured Guaranty Ltd. | 866,427 | ||||||
29,860 | Astoria Financial Corp. | 395,944 | ||||||
13,657 | AvalonBay Communities, Inc. REIT | 1,864,863 | ||||||
30,903 | Axis Capital Holdings Ltd. | 1,413,812 | ||||||
16,513 | BancorpSouth, Inc. | 385,744 | ||||||
3,448,847 | Bank of America Corp. | 52,215,544 | ||||||
9,126 | Bank of Hawaii Corp. | 503,481 | ||||||
265,942 | Bank of New York Mellon Corp. (The) | 9,007,456 | ||||||
12,783 | BankUnited, Inc. | 421,711 | ||||||
170,111 | BB&T Corp. | 6,350,244 | ||||||
348,737 | Berkshire Hathaway, Inc., Class B(b) | 44,934,762 | ||||||
30,892 | BioMed Realty Trust, Inc. REIT | 645,643 | ||||||
16,653 | BlackRock, Inc. | 5,012,553 | ||||||
16,633 | Boston Properties, Inc. REIT | 1,948,390 | ||||||
41,099 | Brandywine Realty Trust REIT | 597,990 | ||||||
15,912 | Brown & Brown, Inc. | 473,859 | ||||||
13,030 | Camden Property Trust REIT | 892,425 | ||||||
128,758 | Capital One Financial Corp. | 9,515,216 | ||||||
51,581 | Capitol Federal Financial, Inc. | 621,035 | ||||||
36,924 | Capstead Mortgage Corp. REIT | 471,889 | ||||||
36,010 | CBL & Associates Properties, Inc. REIT | 654,302 | ||||||
33,196 | CBRE Group, Inc., Class A(b) | 884,341 | ||||||
92,114 | Charles Schwab Corp. (The) | 2,445,627 | ||||||
60,347 | Chubb Corp. (The) | 5,556,752 | ||||||
35,005 | Cincinnati Financial Corp. | 1,706,144 | ||||||
36,080 | CIT Group, Inc. | 1,553,244 | ||||||
854,215 | Citigroup, Inc. | 40,925,441 | ||||||
7,650 | City National Corp. | 555,161 | ||||||
61,693 | CME Group, Inc. | 4,342,570 | ||||||
60,074 | CNO Financial Group, Inc. | 1,036,277 | ||||||
34,204 | Columbia Property Trust, Inc. REIT | 969,341 | ||||||
37,815 | Comerica, Inc. | 1,824,196 | ||||||
17,988 | Commerce Bancshares, Inc. | 782,118 | ||||||
31,442 | CommonWealth REIT | 798,941 | ||||||
18,794 | Corporate Office Properties Trust REIT | 502,740 | ||||||
14,980 | Corrections Corp. of America REIT | 491,344 | ||||||
16,016 | Crown Castle International Corp. REIT | 1,164,844 | ||||||
9,333 | Cullen/Frost Bankers, Inc. | 713,135 | ||||||
68,885 | CYS Investments, Inc. REIT | 592,411 | ||||||
53,312 | DCT Industrial Trust, Inc. REIT | 416,900 | ||||||
40,237 | DDR Corp. REIT | 690,869 | ||||||
34,455 | DiamondRock Hospitality Co. REIT | 422,763 | ||||||
20,319 | Digital Realty Trust, Inc. REIT(c) | 1,085,035 | ||||||
62,684 | Discover Financial Services | 3,504,036 | ||||||
19,404 | Douglas Emmett, Inc. REIT | 535,550 | ||||||
57,345 | Duke Realty Corp. REIT | 1,004,684 | ||||||
70,961 | E*TRADE Financial Corp.(b) | 1,593,074 | ||||||
15,788 | East West Bancorp, Inc. | 544,844 | ||||||
14,470 | Eaton Vance Corp. | 521,933 | ||||||
12,059 | Endurance Specialty Holdings Ltd. | 612,838 | ||||||
8,683 | EPR Properties REIT | 465,496 | ||||||
44,278 | Equity Residential REIT | 2,631,884 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
3,972 | Essex Property Trust, Inc. REIT | $ | 688,189 | |||||
10,851 | Everest Re Group Ltd. | 1,714,784 | ||||||
35,522 | F.N.B. Corp. | 441,894 | ||||||
6,898 | Federal Realty Investment Trust REIT | 810,791 | ||||||
27,909 | Federated Investors, Inc., Class B(c) | 796,523 | ||||||
46,787 | Fidelity National Financial, Inc., Class A | 1,505,606 | ||||||
184,338 | Fifth Third Bancorp | 3,799,206 | ||||||
29,762 | First American Financial Corp. | 791,669 | ||||||
54,141 | First Horizon National Corp. | 622,080 | ||||||
114,982 | First Niagara Financial Group, Inc. | 1,025,639 | ||||||
11,648 | First Republic Bank | 591,252 | ||||||
27,107 | FirstMerit Corp. | 525,605 | ||||||
45,388 | Franklin Resources, Inc. | 2,376,062 | ||||||
47,945 | Fulton Financial Corp. | 584,450 | ||||||
69,315 | General Growth Properties, Inc. REIT | 1,592,166 | ||||||
205,043 | Genworth Financial, Inc., Class A(b) | 3,660,018 | ||||||
106,242 | Goldman Sachs Group, Inc. (The) | 16,979,596 | ||||||
16,309 | Hancock Holding Co. | 550,103 | ||||||
12,852 | Hanover Insurance Group, Inc. (The) | 751,199 | ||||||
180,510 | Hartford Financial Services Group, Inc. (The) | 6,474,894 | ||||||
37,152 | Hatteras Financial Corp. REIT | 727,065 | ||||||
21,182 | HCC Insurance Holdings, Inc. | 973,101 | ||||||
74,471 | HCP, Inc. REIT | 3,117,356 | ||||||
36,592 | Health Care REIT, Inc. REIT | 2,308,589 | ||||||
17,411 | Healthcare Realty Trust, Inc. REIT | 437,887 | ||||||
15,232 | Highwoods Properties, Inc. REIT | 614,611 | ||||||
9,495 | Home Properties, Inc. REIT | 584,892 | ||||||
42,692 | Hospitality Properties Trust REIT | 1,282,895 | ||||||
90,465 | Host Hotels & Resorts, Inc. REIT | 1,940,474 | ||||||
157,756 | Hudson City Bancorp, Inc. | 1,571,250 | ||||||
175,201 | Huntington Bancshares, Inc. | 1,604,841 | ||||||
25,801 | Interactive Brokers Group, Inc., Class A | 616,644 | ||||||
4,578 | IntercontinentalExchange Group, Inc. | 935,926 | ||||||
63,948 | Invesco Ltd.(d) | 2,251,609 | ||||||
37,726 | Invesco Mortgage Capital, Inc. REIT(d) | 628,892 | ||||||
36,058 | Janus Capital Group, Inc. | 437,384 | ||||||
5,349 | Jones Lang LaSalle, Inc. | 619,896 | ||||||
1,010,454 | JPMorgan Chase & Co. | 56,565,215 | ||||||
14,364 | Kemper Corp. | 566,085 | ||||||
229,826 | KeyCorp | 3,134,827 | ||||||
9,175 | Kilroy Realty Corp. REIT | 546,555 | ||||||
64,297 | Kimco Realty Corp. REIT | 1,473,687 | ||||||
13,253 | LaSalle Hotel Properties REIT | 438,409 | ||||||
22,947 | Legg Mason, Inc. | 1,075,985 | ||||||
40,460 | Leucadia National Corp. | 1,032,539 | ||||||
41,553 | Lexington Realty Trust REIT | 447,110 | ||||||
27,466 | Liberty Property Trust REIT | 1,029,975 | ||||||
63,318 | Lincoln National Corp. | 3,071,556 | ||||||
91,528 | Loews Corp. | 4,024,486 | ||||||
9,398 | LPL Financial Holdings, Inc. | 444,995 | ||||||
23,030 | M&T Bank Corp. | 2,809,890 | ||||||
19,969 | Macerich Co. (The) REIT | 1,296,188 | ||||||
36,425 | Mack-Cali Realty Corp. REIT | 741,977 | ||||||
1,550 | Markel Corp.(b) | 970,176 | ||||||
72,928 | Marsh & McLennan Cos., Inc. | 3,596,080 | ||||||
30,299 | McGraw-Hill Financial, Inc. | 2,240,005 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 21 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
9,571 | Mercury General Corp. | $ | 458,068 | |||||
244,890 | MetLife, Inc. | 12,819,992 | ||||||
111,509 | MFA Financial, Inc. REIT | 884,266 | ||||||
6,539 | Mid-America Apartment Communities, Inc. REIT | 455,441 | ||||||
11,944 | Moody’s Corp. | 937,604 | ||||||
322,809 | Morgan Stanley | 9,984,482 | ||||||
10,855 | MSCI, Inc., Class A(b) | 440,062 | ||||||
25,526 | NASDAQ OMX Group, Inc. (The) | 941,909 | ||||||
14,782 | National Retail Properties, Inc. REIT | 504,510 | ||||||
136,434 | New York Community Bancorp, Inc. | 2,102,448 | ||||||
40,996 | Northern Trust Corp. | 2,470,009 | ||||||
10,111 | Ocwen Financial Corp.(b) | 383,207 | ||||||
71,069 | Old Republic International Corp. | 1,176,903 | ||||||
12,863 | OMEGA Healthcare Investors, Inc. REIT(c) | 447,375 | ||||||
18,077 | PartnerRe Ltd. | 1,905,316 | ||||||
99,836 | People’s United Financial, Inc. | 1,425,658 | ||||||
45,088 | PHH Corp.(b) | 1,071,742 | ||||||
54,760 | Piedmont Office Realty Trust, Inc., Class A REIT | 964,324 | ||||||
7,410 | Platinum Underwriters Holdings Ltd. | 464,681 | ||||||
28,344 | Plum Creek Timber Co., Inc. REIT | 1,235,798 | ||||||
116,572 | PNC Financial Services Group, Inc. | 9,796,711 | ||||||
36,869 | Popular, Inc.(b) | 1,139,252 | ||||||
11,331 | Primerica, Inc. | 519,980 | ||||||
61,490 | Principal Financial Group, Inc. | 2,880,192 | ||||||
12,380 | ProAssurance Corp. | 562,300 | ||||||
138,352 | Progressive Corp. (The) | 3,355,036 | ||||||
63,150 | Prologis, Inc. REIT | 2,565,785 | ||||||
7,049 | Prosperity Bancshares, Inc. | 415,891 | ||||||
23,683 | Protective Life Corp. | 1,211,385 | ||||||
127,305 | Prudential Financial, Inc. | 10,270,967 | ||||||
12,949 | Public Storage REIT | 2,272,679 | ||||||
15,083 | Raymond James Financial, Inc. | 749,625 | ||||||
20,811 | Rayonier, Inc. REIT | 938,576 | ||||||
13,973 | Realogy Holdings Corp.(b) | 587,565 | ||||||
14,443 | Realty Income Corp. REIT(c) | 627,548 | ||||||
13,910 | Regency Centers Corp. REIT | 729,301 | ||||||
370,844 | Regions Financial Corp. | 3,760,358 | ||||||
24,127 | Reinsurance Group of America, Inc. | 1,850,782 | ||||||
8,577 | RenaissanceRe Holdings Ltd. | 868,078 | ||||||
38,121 | Retail Properties of America, Inc., Class A REIT | 545,893 | ||||||
9,516 | RLI Corp. | 409,759 | ||||||
17,128 | RLJ Lodging Trust REIT | 456,804 | ||||||
34,952 | Senior Housing Properties Trust REIT | 820,323 | ||||||
3,492 | Signature Bank(b) | 414,919 | ||||||
25,481 | Simon Property Group, Inc. REIT | 4,413,309 | ||||||
11,383 | SL Green Realty Corp. REIT | 1,191,914 | ||||||
90,163 | SLM Corp. | 2,321,697 | ||||||
11,294 | StanCorp Financial Group, Inc. | 690,063 | ||||||
22,934 | Starwood Property Trust, Inc. REIT | 551,563 | ||||||
73,386 | State Street Corp. | 4,737,800 | ||||||
8,207 | Stifel Financial Corp.(b) | 383,841 | ||||||
147,188 | SunTrust Banks, Inc. | 5,631,413 | ||||||
50,607 | Susquehanna Bancshares, Inc. | 524,289 | ||||||
4,161 | SVB Financial Group(b) | 443,937 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
37,095 | Symetra Financial Corp. | $ | 766,383 | |||||
213,687 | Synovus Financial Corp. | 685,935 | ||||||
24,593 | T. Rowe Price Group, Inc. | 2,019,823 | ||||||
6,061 | Taubman Centers, Inc. REIT | 441,483 | ||||||
38,285 | TCF Financial Corp. | 601,075 | ||||||
15,698 | TD Ameritrade Holding Corp. | 500,766 | ||||||
17,540 | Torchmark Corp. | 1,397,938 | ||||||
125,744 | Travelers Cos., Inc. (The) | 11,389,892 | ||||||
17,384 | Trustmark Corp. | 397,572 | ||||||
54,513 | Two Harbors Investment Corp. REIT | 565,845 | ||||||
317,007 | U.S. Bancorp | 12,927,545 | ||||||
39,335 | UDR, Inc. REIT | 1,017,203 | ||||||
76,537 | Unum Group | 2,542,559 | ||||||
22,572 | Validus Holdings Ltd. | 836,744 | ||||||
64,321 | Valley National Bancorp | 644,496 | ||||||
42,104 | Ventas, Inc. REIT | 2,782,232 | ||||||
26,386 | Vornado Realty Trust REIT | 2,707,204 | ||||||
35,290 | Voya Financial, Inc. | 1,248,913 | ||||||
28,728 | W.R. Berkley Corp. | 1,270,927 | ||||||
6,965 | Waddell & Reed Financial, Inc., Class A | 469,789 | ||||||
16,894 | Washington REIT | 413,227 | ||||||
21,846 | Washington Federal, Inc. | 471,437 | ||||||
15,966 | Webster Financial Corp. | 481,215 | ||||||
19,642 | Weingarten Realty Investors REIT | 612,830 | ||||||
1,023,375 | Wells Fargo & Co. | 50,800,335 | ||||||
230,160 | Weyerhaeuser Co. REIT | 6,870,276 | ||||||
1,050 | White Mountains Insurance Group Ltd. | 626,073 | ||||||
29,363 | Willis Group Holdings PLC | 1,203,589 | ||||||
80,027 | XL Group PLC | 2,508,846 | ||||||
43,732 | Zions Bancorp. | 1,264,729 | ||||||
|
| |||||||
668,210,841 | ||||||||
|
| |||||||
Health Care—10.2% | ||||||||
423,805 | Abbott Laboratories | 16,418,206 | ||||||
114,945 | AbbVie, Inc. | 5,986,336 | ||||||
6,346 | Actavis PLC(b) | 1,296,678 | ||||||
75,548 | Aetna, Inc. | 5,397,905 | ||||||
26,131 | Agilent Technologies, Inc. | 1,412,119 | ||||||
16,271 | Alere, Inc.(b) | 543,451 | ||||||
2,544 | Alexion Pharmaceuticals, Inc.(b) | 402,461 | ||||||
14,864 | Allergan, Inc. | 2,465,046 | ||||||
96,010 | AmerisourceBergen Corp. | 6,257,932 | ||||||
55,993 | Amgen, Inc. | 6,257,218 | ||||||
75,512 | Baxter International, Inc. | 5,496,518 | ||||||
25,268 | Becton, Dickinson and Co. | 2,856,042 | ||||||
7,882 | Biogen Idec, Inc.(b) | 2,263,080 | ||||||
3,314 | Bio-Rad Laboratories, Inc., Class A(b) | 408,318 | ||||||
91 | Bio-Rad Laboratories, Inc., Class B(b) | 11,183 | ||||||
222,933 | Boston Scientific Corp.(b) | 2,811,185 | ||||||
226,033 | Bristol-Myers Squibb Co. | 11,321,993 | ||||||
6,869 | C.R. Bard, Inc. | 943,320 | ||||||
133,111 | Cardinal Health, Inc. | 9,252,546 | ||||||
38,691 | CareFusion Corp.(b) | 1,511,270 | ||||||
12,244 | Celgene Corp.(b) | 1,799,990 | ||||||
11,108 | Centene Corp.(b) | 737,571 | ||||||
13,322 | Cerner Corp.(b) | 683,419 | ||||||
45,869 | Cigna Corp. | 3,671,355 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 22 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
44,808 | Community Health Systems, Inc.(b) | $ | 1,697,775 | |||||
3,665 | Cooper Cos., Inc. (The) | 483,450 | ||||||
5,553 | Covance, Inc.(b) | 490,219 | ||||||
59,880 | Covidien PLC | 4,266,450 | ||||||
29,566 | DaVita HealthCare Partners, Inc.(b) | 2,048,924 | ||||||
15,846 | DENTSPLY International, Inc. | 707,207 | ||||||
8,308 | Edwards Lifesciences Corp.(b) | 676,853 | ||||||
196,221 | Eli Lilly & Co. | 11,596,661 | ||||||
8,957 | Endo International PLC(b) | 563,798 | ||||||
127,454 | Express Scripts Holding Co.(b) | 8,485,887 | ||||||
18,599 | Forest Laboratories, Inc.(b) | 1,709,434 | ||||||
53,259 | Gilead Sciences, Inc.(b) | 4,180,299 | ||||||
165,133 | HCA Holdings, Inc.(b) | 8,586,916 | ||||||
51,621 | Health Net, Inc.(b) | 1,772,149 | ||||||
15,170 | HealthSouth Corp. | 525,489 | ||||||
12,563 | Henry Schein, Inc.(b) | 1,435,071 | ||||||
44,289 | Hologic, Inc.(b) | 929,405 | ||||||
29,505 | Hospira, Inc.(b) | 1,351,329 | ||||||
40,054 | Humana, Inc. | 4,395,926 | ||||||
2,345 | Illumina, Inc.(b) | 318,568 | ||||||
2,351 | Intuitive Surgical, Inc.(b) | 850,357 | ||||||
409,985 | Johnson & Johnson | 41,527,381 | ||||||
41,300 | Kindred Healthcare, Inc. | 1,036,630 | ||||||
17,203 | Laboratory Corp. of America Holdings(b) | 1,697,936 | ||||||
15,564 | LifePoint Hospitals, Inc.(b) | 870,339 | ||||||
9,367 | Magellan Health Services, Inc.(b) | 540,663 | ||||||
10,530 | Mallinckrodt PLC(b)(c) | 750,052 | ||||||
61,640 | McKesson Corp. | 10,428,872 | ||||||
10,594 | MEDNAX, Inc.(b) | 627,694 | ||||||
147,929 | Medtronic, Inc. | 8,701,184 | ||||||
475,747 | Merck & Co., Inc. | 27,859,744 | ||||||
1,989 | Mettler-Toledo International, Inc.(b) | 463,676 | ||||||
10,857 | Molina Healthcare, Inc.(b) | 406,052 | ||||||
36,565 | Mylan, Inc.(b) | 1,856,771 | ||||||
19,910 | Omnicare, Inc. | 1,180,066 | ||||||
25,165 | Owens & Minor, Inc. | 844,034 | ||||||
13,530 | Patterson Cos., Inc. | 550,671 | ||||||
44,668 | PDL BioPharma, Inc.(c) | 379,231 | ||||||
12,701 | PerkinElmer, Inc. | 533,061 | ||||||
3,808 | Perrigo Co. PLC | 551,627 | ||||||
1,367,200 | Pfizer, Inc. | 42,766,016 | ||||||
35,541 | Quest Diagnostics, Inc. | 1,987,808 | ||||||
11,246 | ResMed, Inc.(c) | 560,613 | ||||||
27,017 | St. Jude Medical, Inc. | 1,714,769 | ||||||
10,458 | STERIS Corp. | 502,507 | ||||||
28,150 | Stryker Corp. | 2,188,662 | ||||||
6,260 | Teleflex, Inc. | 639,083 | ||||||
33,401 | Tenet Healthcare Corp.(b) | 1,505,717 | ||||||
29,687 | Thermo Fisher Scientific, Inc. | 3,384,318 | ||||||
202,561 | UnitedHealth Group, Inc. | 15,200,177 | ||||||
11,904 | Universal Health Services, Inc., Class B | 973,628 | ||||||
9,536 | Varian Medical Systems, Inc.(b) | 758,589 | ||||||
13,388 | VCA Antech, Inc.(b) | 410,074 | ||||||
5,827 | Waters Corp.(b) | 574,193 | ||||||
15,109 | WellCare Health Plans, Inc.(b) | 1,019,404 | ||||||
111,815 | WellPoint, Inc. | 11,257,534 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
18,256 | Zimmer Holdings, Inc. | $ | 1,767,181 | |||||
53,234 | Zoetis, Inc. | 1,610,861 | ||||||
|
| |||||||
336,904,127 | ||||||||
|
| |||||||
Industrials—11.0% | ||||||||
86,090 | 3M Co. | 11,974,258 | ||||||
17,865 | ABM Industries, Inc. | 483,963 | ||||||
47,615 | ADT Corp. (The) | 1,439,878 | ||||||
37,483 | AECOM Technology Corp.(b) | 1,215,199 | ||||||
13,011 | AerCap Holdings NV(b) | 542,949 | ||||||
32,792 | AGCO Corp. | 1,826,514 | ||||||
12,945 | Air Lease Corp. | 464,337 | ||||||
11,317 | Alaska Air Group, Inc. | 1,064,703 | ||||||
12,025 | Allegion PLC | 593,434 | ||||||
6,024 | Alliant Techsystems, Inc. | 868,781 | ||||||
21,257 | American Airlines Group, Inc.(b) | 745,483 | ||||||
16,090 | AMETEK, Inc. | 848,265 | ||||||
18,856 | Armstrong World Industries, Inc.(b) | 991,071 | ||||||
41,197 | Avis Budget Group, Inc.(b) | 2,166,550 | ||||||
9,748 | B/E Aerospace, Inc.(b) | 855,582 | ||||||
13,309 | Babcock & Wilcox Co. (The) | 463,020 | ||||||
85,479 | Boeing Co. (The) | 11,028,501 | ||||||
16,533 | Brink’s Co. (The) | 420,600 | ||||||
31,410 | C.H. Robinson Worldwide, Inc. | 1,850,049 | ||||||
8,238 | Carlisle Cos., Inc. | 677,575 | ||||||
125,849 | Caterpillar, Inc. | 13,264,485 | ||||||
8,572 | Chicago Bridge & Iron Co. NV | 686,360 | ||||||
14,907 | Cintas Corp. | 878,470 | ||||||
8,609 | Clean Harbors, Inc.(b) | 516,540 | ||||||
6,328 | Colfax Corp.(b) | 455,489 | ||||||
17,647 | Con-way, Inc. | 749,645 | ||||||
3,592 | Copa Holdings SA, Class A (Panama) | 485,926 | ||||||
31,181 | Covanta Holding Corp. | 575,289 | ||||||
7,064 | Crane Co. | 513,765 | ||||||
172,150 | CSX Corp. | 4,858,073 | ||||||
21,685 | Cummins, Inc. | 3,271,182 | ||||||
6,830 | Curtiss-Wright Corp. | 436,710 | ||||||
50,039 | Danaher Corp. | 3,671,862 | ||||||
68,894 | Deere & Co. | 6,430,566 | ||||||
149,187 | Delta Air Lines, Inc. | 5,494,557 | ||||||
9,532 | Deluxe Corp. | 523,783 | ||||||
11,869 | Donaldson Co., Inc. | 499,566 | ||||||
29,995 | Dover Corp. | 2,591,568 | ||||||
159,020 | DryShips, Inc. (Greece)(b)(c) | 464,338 | ||||||
5,668 | Dun & Bradstreet Corp. (The) | 627,788 | ||||||
62,314 | Eaton Corp. PLC | 4,526,489 | ||||||
15,465 | EMCOR Group, Inc. | 711,235 | ||||||
122,338 | Emerson Electric Co. | 8,341,005 | ||||||
7,451 | EnerSys | 503,539 | ||||||
11,048 | Equifax, Inc. | 782,309 | ||||||
5,170 | Esterline Technologies Corp.(b) | 563,633 | ||||||
50,433 | Exelis, Inc. | 935,028 | ||||||
27,146 | Expeditors International of Washington, Inc. | 1,119,501 | ||||||
21,253 | Fastenal Co. | 1,064,350 | ||||||
51,165 | FedEx Corp. | 6,971,231 | ||||||
12,791 | Flowserve Corp. | 934,383 | ||||||
35,650 | Fluor Corp. | 2,698,705 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 23 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
19,180 | Fortune Brands Home & Security, Inc. | $ | 764,323 | |||||
25,823 | Foster Wheeler AG (Switzerland)(b) | 885,212 | ||||||
16,137 | FTI Consulting, Inc.(b) | 553,499 | ||||||
7,820 | GATX Corp. | 513,227 | ||||||
9,324 | Generac Holdings, Inc. | 548,997 | ||||||
30,400 | General Cable Corp. | 778,848 | ||||||
64,590 | General Dynamics Corp. | 7,069,375 | ||||||
2,303,267 | General Electric Co. | 61,934,850 | ||||||
4,099 | Genesee & Wyoming, Inc., Class A(b) | 405,842 | ||||||
46,835 | GrafTech International Ltd.(b)(c) | 525,020 | ||||||
29,792 | Harsco Corp. | 712,923 | ||||||
107,955 | Hertz Global Holdings, Inc.(b) | 3,073,479 | ||||||
9,230 | Hexcel Corp.(b) | 384,799 | ||||||
92,256 | Honeywell International, Inc. | 8,570,582 | ||||||
441 | Hubbell, Inc., Class A | 49,436 | ||||||
6,213 | Hubbell, Inc., Class B | 731,394 | ||||||
7,831 | Huntington Ingalls Industries, Inc. | 806,593 | ||||||
7,830 | IDEX Corp. | 583,883 | ||||||
4,121 | IHS, Inc., Class A(b) | 497,116 | ||||||
61,472 | Illinois Tool Works, Inc. | 5,239,259 | ||||||
50,784 | Ingersoll-Rand PLC | 3,036,883 | ||||||
33,807 | Iron Mountain, Inc. | 961,471 | ||||||
28,399 | ITT Corp. | 1,225,133 | ||||||
9,171 | J.B. Hunt Transport Services, Inc. | 697,913 | ||||||
33,226 | Jacobs Engineering Group, Inc.(b) | 1,917,140 | ||||||
109,441 | JetBlue Airways Corp.(b) | 865,131 | ||||||
20,817 | Joy Global, Inc.(c) | 1,256,930 | ||||||
8,751 | Kansas City Southern | 882,801 | ||||||
16,974 | KAR Auction Services, Inc. | 505,486 | ||||||
44,201 | KBR, Inc. | 1,121,379 | ||||||
14,132 | Kennametal, Inc. | 660,388 | ||||||
6,051 | Kirby Corp.(b) | 608,852 | ||||||
25,582 | L-3 Communications Holdings, Inc. | 2,951,395 | ||||||
4,540 | Lennox International, Inc. | 380,588 | ||||||
6,427 | Lincoln Electric Holdings, Inc. | 429,388 | ||||||
52,776 | Lockheed Martin Corp. | 8,662,653 | ||||||
17,394 | Manitowoc Co., Inc. (The) | 552,781 | ||||||
28,654 | Manpowergroup, Inc. | 2,330,716 | ||||||
59,540 | Masco Corp. | 1,196,159 | ||||||
38,657 | Meritor, Inc.(b) | 458,859 | ||||||
7,049 | Moog, Inc., Class A(b) | 461,357 | ||||||
118 | Moog, Inc., Class B(b) | 7,727 | ||||||
34,319 | MRC Global, Inc.(b) | 1,001,772 | ||||||
5,662 | MSC Industrial Direct Co., Inc., Class A | 515,582 | ||||||
41,560 | Navistar International Corp.(b)(c) | 1,576,371 | ||||||
29,266 | Nielsen Holdings NV | 1,374,039 | ||||||
54,831 | Norfolk Southern Corp. | 5,183,174 | ||||||
52,417 | Northrop Grumman Corp. | 6,369,190 | ||||||
8,933 | Old Dominion Freight Line, Inc.(b) | 541,608 | ||||||
18,021 | Oshkosh Corp. | 1,000,346 | ||||||
27,213 | Owens Corning | 1,111,651 | ||||||
53,479 | PACCAR, Inc. | 3,421,586 | ||||||
9,270 | Pall Corp. | 780,071 | ||||||
22,221 | Parker Hannifin Corp. | 2,819,400 | ||||||
16,819 | Pentair Ltd. | 1,249,484 | ||||||
73,005 | Pitney Bowes, Inc. | 1,956,534 | ||||||
9,591 | Precision Castparts Corp. | 2,427,386 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
29,454 | Quanta Services, Inc.(b) | $ | 1,039,137 | |||||
104,527 | R.R. Donnelley & Sons Co. | 1,839,675 | ||||||
58,353 | Raytheon Co. | 5,571,544 | ||||||
7,878 | Regal-Beloit Corp. | 588,723 | ||||||
14,987 | Republic Airways Holdings, Inc.(b) | 124,542 | ||||||
75,678 | Republic Services, Inc. | 2,655,541 | ||||||
16,819 | Robert Half International, Inc. | 753,491 | ||||||
13,149 | Rockwell Automation, Inc. | 1,567,098 | ||||||
16,446 | Rockwell Collins, Inc. | 1,277,032 | ||||||
7,492 | Roper Industries, Inc. | 1,041,013 | ||||||
17,782 | Ryder System, Inc. | 1,461,325 | ||||||
11,928 | Sensata Technologies Holding NV(b) | 506,582 | ||||||
10,306 | SkyWest, Inc. | 119,550 | ||||||
7,239 | Snap-on, Inc. | 839,724 | ||||||
107,895 | Southwest Airlines Co. | 2,607,822 | ||||||
28,352 | Spirit Aerosystems Holdings, Inc., Class A(b) | 851,411 | ||||||
9,350 | SPX Corp. | 952,204 | ||||||
24,813 | Stanley Black & Decker, Inc. | 2,131,189 | ||||||
33,236 | Steelcase, Inc., Class A | 547,729 | ||||||
5,172 | Stericycle, Inc.(b) | 602,228 | ||||||
4,894 | Teledyne Technologies, Inc.(b) | 454,457 | ||||||
23,985 | Terex Corp. | 1,038,311 | ||||||
51,200 | Textron, Inc. | 2,094,080 | ||||||
14,936 | Timken Co. (The) | 942,163 | ||||||
5,542 | Towers Watson & Co., Class A | 621,923 | ||||||
3,359 | TransDigm Group, Inc. | 597,465 | ||||||
9,269 | Trinity Industries, Inc. | 695,731 | ||||||
9,702 | Triumph Group, Inc. | 628,787 | ||||||
22,137 | Tutor Perini Corp.(b) | 655,255 | ||||||
91,502 | Tyco International Ltd. | 3,742,432 | ||||||
48,273 | Union Pacific Corp. | 9,192,627 | ||||||
93,390 | United Continental Holdings, Inc.(b) | 3,816,849 | ||||||
102,679 | United Parcel Service, Inc., Class B | 10,113,882 | ||||||
11,647 | United Rentals, Inc.(b) | 1,092,838 | ||||||
13,780 | United Stationers, Inc. | 517,163 | ||||||
130,490 | United Technologies Corp. | 15,440,882 | ||||||
26,067 | URS Corp. | 1,228,277 | ||||||
30,991 | UTi Worldwide, Inc. | 303,402 | ||||||
3,223 | Valmont Industries, Inc. | 479,937 | ||||||
6,197 | W.W. Grainger, Inc. | 1,576,517 | ||||||
3,977 | WABCO Holdings, Inc.(b) | 425,579 | ||||||
12,228 | Waste Connections, Inc. | 546,102 | ||||||
118,312 | Waste Management, Inc. | 5,258,968 | ||||||
67 | Watsco, Inc., Class B | 6,651 | ||||||
4,805 | Watsco, Inc. | 494,483 | ||||||
15,993 | Werner Enterprises, Inc. | 409,421 | ||||||
9,986 | WESCO International, Inc.(b) | 876,571 | ||||||
19,919 | Xylem, Inc. | 748,755 | ||||||
21,753 | YRC Worldwide, Inc.(b)(c) | 487,920 | ||||||
|
| |||||||
365,361,051 | ||||||||
|
| |||||||
Information Technology—11.4% | ||||||||
64,715 | Accenture PLC, Class A | 5,191,437 | ||||||
114,670 | Activision Blizzard, Inc. | 2,294,547 | ||||||
31,284 | Adobe Systems, Inc.(b) | 1,929,910 | ||||||
179,366 | Advanced Micro Devices, Inc.(b)(c) | 733,607 | ||||||
10,630 | Akamai Technologies, Inc.(b) | 564,134 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 24 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
2,948 | Alliance Data Systems Corp.(b) | $ | 713,121 | |||||
27,822 | Altera Corp. | 904,771 | ||||||
19,066 | Amdocs Ltd. | 887,141 | ||||||
74,089 | Amkor Technology, Inc.(b) | 589,008 | ||||||
10,672 | Amphenol Corp., Class A | 1,017,575 | ||||||
35,564 | Analog Devices, Inc. | 1,824,078 | ||||||
6,823 | Anixter International, Inc. | 668,518 | ||||||
5,831 | ANSYS, Inc.(b) | 444,964 | ||||||
30,761 | AOL, Inc.(b) | 1,316,878 | ||||||
62,063 | Apple, Inc. | 36,622,756 | ||||||
164,543 | Applied Materials, Inc. | 3,136,190 | ||||||
51,180 | Arrow Electronics, Inc.(b) | 2,904,465 | ||||||
13,886 | Autodesk, Inc.(b) | 666,806 | ||||||
55,628 | Automatic Data Processing, Inc. | 4,336,759 | ||||||
13,235 | Avago Technologies Ltd., Class A (Singapore) | 840,423 | ||||||
73,292 | Avnet, Inc. | 3,161,084 | ||||||
19,476 | Benchmark Electronics, Inc.(b) | 451,454 | ||||||
22,399 | Blackhawk Network Holdings, Inc., Class B(b) | 515,849 | ||||||
32,308 | Booz Allen Hamilton Holding Corp. | 750,838 | ||||||
61,608 | Broadcom Corp., Class A | 1,898,142 | ||||||
16,236 | Broadridge Financial Solutions, Inc. | 622,488 | ||||||
65,794 | Brocade Communications Systems, Inc.(b) | 612,542 | ||||||
50,492 | CA, Inc. | 1,521,829 | ||||||
7,777 | CACI International, Inc., Class A(b) | 541,668 | ||||||
10,343 | Check Point Software Technologies Ltd. (Israel)(b) | 662,573 | ||||||
674,985 | Cisco Systems, Inc. | 15,598,903 | ||||||
15,549 | Citrix Systems, Inc.(b) | 922,211 | ||||||
34,405 | Cognizant Technology Solutions Corp., Class A(b) | 1,648,172 | ||||||
41,730 | Computer Sciences Corp. | 2,469,581 | ||||||
20,313 | Convergys Corp. | 437,542 | ||||||
25,452 | CoreLogic, Inc.(b) | 713,420 | ||||||
250,930 | Corning, Inc. | 5,246,946 | ||||||
8,653 | Cree, Inc.(b) | 408,162 | ||||||
17,825 | Diebold, Inc. | 670,398 | ||||||
4,289 | DST Systems, Inc. | 395,403 | ||||||
94,797 | eBay, Inc.(b) | 4,913,329 | ||||||
9,041 | EchoStar Corp., Class A(b) | 406,483 | ||||||
24,936 | Electronic Arts, Inc.(b) | 705,689 | ||||||
288,264 | EMC Corp. | 7,437,211 | ||||||
4,059 | Equinix, Inc.(b) | 762,321 | ||||||
4,033 | F5 Networks, Inc.(b) | 424,151 | ||||||
27,135 | Facebook, Inc., Class A(b) | 1,622,130 | ||||||
36,910 | Fairchild Semiconductor International, Inc.(b) | 469,864 | ||||||
35,445 | Fidelity National Information Services, Inc. | 1,893,826 | ||||||
14,521 | First Solar, Inc.(b) | 980,022 | ||||||
30,007 | Fiserv, Inc.(b) | 1,823,825 | ||||||
388,738 | Flextronics International Ltd.(b) | 3,494,755 | ||||||
15,201 | FLIR Systems, Inc. | 517,442 | ||||||
29,989 | Genpact Ltd.(b) | 505,615 | ||||||
5,803 | Global Payments, Inc. | 387,814 | ||||||
14,265 | Google, Inc., Class A(b) | 7,630,063 | ||||||
14,266 | Google, Inc., Class C(b) | 7,513,332 | ||||||
19,303 | Harris Corp. | 1,419,157 | ||||||
698,435 | Hewlett-Packard Co. | 23,090,261 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
87,838 | Ingram Micro, Inc., Class A(b) | $ | 2,368,112 | |||||
21,804 | Insight Enterprises, Inc.(b) | 569,520 | ||||||
1,124,667 | Intel Corp. | 30,017,362 | ||||||
159,957 | International Business Machines Corp. | 31,426,752 | ||||||
14,088 | Intuit, Inc. | 1,067,166 | ||||||
14,692 | Itron, Inc.(b) | 558,296 | ||||||
87,593 | Jabil Circuit, Inc. | 1,511,855 | ||||||
67,938 | Juniper Networks, Inc.(b) | 1,677,389 | ||||||
19,283 | KLA-Tencor Corp. | 1,233,919 | ||||||
24,386 | Lam Research Corp.(b) | 1,404,877 | ||||||
28,395 | Leidos Holdings, Inc. | 1,057,430 | ||||||
17,857 | Lexmark International, Inc., Class A | 767,851 | ||||||
22,291 | Linear Technology Corp. | 991,949 | ||||||
50,898 | LSI Corp. | 567,004 | ||||||
57,190 | Marvell Technology Group Ltd. | 907,033 | ||||||
33,198 | MasterCard, Inc., Class A | 2,441,713 | ||||||
44,707 | Maxim Integrated Products, Inc. | 1,450,295 | ||||||
27,441 | Microchip Technology, Inc. | 1,304,545 | ||||||
128,965 | Micron Technology, Inc.(b) | 3,368,566 | ||||||
931,142 | Microsoft Corp. | 37,618,137 | ||||||
31,654 | Motorola Solutions, Inc. | 2,012,561 | ||||||
26,393 | NCR Corp.(b) | 805,250 | ||||||
41,102 | NetApp, Inc. | 1,463,642 | ||||||
35,257 | Nuance Communications, Inc.(b) | 567,285 | ||||||
52,902 | NVIDIA Corp. | 977,100 | ||||||
14,260 | NXP Semiconductor NV (Netherlands)(b) | 850,181 | ||||||
75,726 | ON Semiconductor Corp.(b) | 712,582 | ||||||
337,453 | Oracle Corp. | 13,795,079 | ||||||
45,249 | Paychex, Inc. | 1,891,861 | ||||||
32,693 | Polycom, Inc.(b) | 402,124 | ||||||
139,261 | QUALCOMM, Inc. | 10,961,233 | ||||||
7,397 | Red Hat, Inc.(b) | 359,864 | ||||||
16,225 | Rovi Corp.(b) | 361,655 | ||||||
9,476 | Salesforce.com, Inc.(b) | 489,435 | ||||||
27,438 | SanDisk Corp. | 2,331,407 | ||||||
53,031 | Sanmina Corp.(b) | 1,073,878 | ||||||
18,055 | Science Applications International Corp. | 704,145 | ||||||
51,381 | Seagate Technology PLC | 2,701,613 | ||||||
15,818 | Skyworks Solutions, Inc.(b) | 649,329 | ||||||
26,559 | SunEdison, Inc.(b) | 510,730 | ||||||
120,603 | Symantec Corp. | 2,445,829 | ||||||
14,328 | SYNNEX Corp.(b) | 965,421 | ||||||
17,482 | Synopsys, Inc.(b) | 657,673 | ||||||
62,684 | TE Connectivity Ltd. (Switzerland) | 3,697,102 | ||||||
20,699 | Tech Data Corp.(b) | 1,293,481 | ||||||
16,886 | Teradata Corp.(b) | 767,638 | ||||||
27,808 | Teradyne, Inc.(b) | 491,367 | ||||||
130,716 | Texas Instruments, Inc. | 5,941,042 | ||||||
19,338 | Total System Services, Inc. | 614,368 | ||||||
14,905 | Trimble Navigation Ltd.(b) | 572,799 | ||||||
22,124 | Unisys Corp.(b) | 539,162 | ||||||
13,970 | VeriFone Systems, Inc.(b) | 467,157 | ||||||
23,009 | Visa, Inc., Class A | 4,661,853 | ||||||
48,744 | Vishay Intertechnology, Inc. | 693,140 | ||||||
33,490 | Western Digital Corp. | 2,951,474 | ||||||
96,351 | Western Union Co. (The) | 1,529,090 | ||||||
412,141 | Xerox Corp. | 4,982,785 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 25 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
25,389 | Xilinx, Inc. | $ | 1,198,107 | |||||
85,093 | Yahoo!, Inc.(b) | 3,059,093 | ||||||
|
| |||||||
376,292,889 | ||||||||
|
| |||||||
Materials—4.1% | ||||||||
30,921 | Air Products & Chemicals, Inc. | 3,633,836 | ||||||
7,743 | Airgas, Inc. | 822,771 | ||||||
92,670 | AK Steel Holding Corp.(b)(c) | 648,690 | ||||||
12,101 | Albemarle Corp. | 811,251 | ||||||
411,649 | Alcoa, Inc. | 5,544,912 | ||||||
33,444 | Allegheny Technologies, Inc. | 1,377,893 | ||||||
8,797 | AptarGroup, Inc. | 593,094 | ||||||
14,368 | Ashland, Inc. | 1,387,949 | ||||||
25,651 | Avery Dennison Corp. | 1,248,178 | ||||||
23,578 | Ball Corp. | 1,324,848 | ||||||
26,841 | Bemis Co., Inc. | 1,080,082 | ||||||
18,934 | Berry Plastics Group, Inc.(b) | 425,826 | ||||||
12,305 | Cabot Corp. | 711,229 | ||||||
21,345 | Celanese Corp., Series A | 1,311,223 | ||||||
8,287 | CF Industries Holdings, Inc. | 2,031,724 | ||||||
19,643 | Chemtura Corp.(b) | 438,039 | ||||||
85,853 | Cliffs Natural Resources, Inc.(c) | 1,521,315 | ||||||
45,248 | Coeur Mining, Inc.(b) | 391,848 | ||||||
46,419 | Commercial Metals Co. | 891,245 | ||||||
4,894 | Compass Minerals International, Inc. | 448,290 | ||||||
32,335 | Crown Holdings, Inc.(b) | 1,525,242 | ||||||
5,973 | Cytec Industries, Inc. | 569,346 | ||||||
10,627 | Domtar Corp. | 992,137 | ||||||
244,898 | Dow Chemical Co. (The) | 12,220,410 | ||||||
149,223 | E.I. du Pont de Nemours & Co. | 10,045,692 | ||||||
19,861 | Eastman Chemical Co. | 1,731,283 | ||||||
20,146 | Ecolab, Inc. | 2,108,077 | ||||||
11,585 | FMC Corp. | 892,045 | ||||||
284,683 | Freeport-McMoRan Copper & Gold, Inc. | 9,784,555 | ||||||
68,527 | Graphic Packaging Holding Co.(b) | 703,087 | ||||||
8,140 | Greif, Inc., Class A | 441,107 | ||||||
2,178 | Greif, Inc., Class B | 128,088 | ||||||
45,732 | Huntsman Corp. | 1,145,587 | ||||||
8,756 | International Flavors & Fragrances, Inc. | 862,641 | ||||||
104,575 | International Paper Co. | 4,878,424 | ||||||
88,774 | LyondellBasell Industries NV, Class A | 8,211,595 | ||||||
5,694 | Martin Marietta Materials, Inc. | 707,935 | ||||||
45,529 | MeadWestvaco Corp. | 1,778,818 | ||||||
49,164 | Monsanto Co. | 5,442,455 | ||||||
66,292 | Mosaic Co. (The) | 3,317,252 | ||||||
1,335 | NewMarket Corp. | 497,047 | ||||||
215,431 | Newmont Mining Corp. | 5,349,152 | ||||||
87,673 | Nucor Corp. | 4,537,078 | ||||||
20,564 | Olin Corp. | 577,848 | ||||||
47,341 | Owens-Illinois, Inc.(b) | 1,504,497 | ||||||
10,026 | Packaging Corp. of America | 668,032 | ||||||
17,926 | PPG Industries, Inc. | 3,470,832 | ||||||
34,960 | Praxair, Inc. | 4,564,028 | ||||||
18,024 | Reliance Steel & Aluminum Co. | 1,276,460 | ||||||
47,744 | Resolute Forest Products, Inc.(b) | 851,753 | ||||||
10,113 | Rock-Tenn Co., Class A | 966,904 | ||||||
9,470 | Rockwood Holdings, Inc. | 672,844 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Materials (continued) | ||||||||
22,423 | RPM International, Inc. | $ | 956,565 | |||||
17,059 | Schnitzer Steel Industries, Inc., Class A | 478,846 | ||||||
34,293 | Sealed Air Corp. | 1,176,593 | ||||||
8,533 | Sensient Technologies Corp. | 461,209 | ||||||
7,106 | Sherwin-Williams Co. (The) | 1,420,063 | ||||||
10,644 | Sigma-Aldrich Corp. | 1,024,059 | ||||||
8,947 | Silgan Holdings, Inc. | 445,113 | ||||||
23,378 | Sonoco Products Co. | 983,746 | ||||||
43,917 | Southern Copper Corp. (Mexico) | 1,323,658 | ||||||
71,620 | Steel Dynamics, Inc. | 1,308,497 | ||||||
94,800 | United States Steel Corp.(c) | 2,466,696 | ||||||
10,599 | Valspar Corp. (The) | 774,151 | ||||||
18,361 | Vulcan Materials Co. | 1,184,835 | ||||||
6,181 | W.R. Grace & Co.(b) | 569,270 | ||||||
51,262 | Walter Energy, Inc.(c) | 369,086 | ||||||
|
| |||||||
134,008,881 | ||||||||
|
| |||||||
Telecommunication Services—4.0% | ||||||||
1,989,971 | AT&T, Inc. | 71,041,965 | ||||||
241,861 | CenturyLink, Inc. | 8,443,367 | ||||||
126,679 | Cincinnati Bell, Inc.(b) | 424,375 | ||||||
621,071 | Frontier Communications Corp.(c) | 3,695,372 | ||||||
68,326 | Leap Wireless International, Inc.(b) | 172,182 | ||||||
25,122 | Level 3 Communications, Inc.(b) | 1,081,000 | ||||||
581,979 | NII Holdings, Inc.(b)(c) | 500,444 | ||||||
88,622 | Sprint Corp. (Japan)(b) | 753,287 | ||||||
50,963 | Telephone & Data Systems, Inc. | 1,385,684 | ||||||
15,698 | T-Mobile US, Inc. (Germany)(b) | 459,794 | ||||||
17,574 | tw telecom, inc.(b) | 539,346 | ||||||
893,441 | Verizon Communications, Inc. | 41,750,498 | ||||||
334,953 | Windstream Holdings, Inc.(c) | 3,038,024 | ||||||
|
| |||||||
133,285,338 | ||||||||
|
| |||||||
Utilities—5.3% | ||||||||
244,531 | AES Corp. (The) | 3,533,473 | ||||||
26,825 | AGL Resources, Inc. | 1,448,550 | ||||||
9,089 | ALLETE, Inc. | 470,447 | ||||||
27,592 | Alliant Energy Corp. | 1,613,580 | ||||||
83,405 | Ameren Corp. | 3,445,461 | ||||||
141,816 | American Electric Power Co., Inc. | 7,631,119 | ||||||
35,861 | American Water Works Co., Inc. | 1,632,751 | ||||||
19,519 | Aqua America, Inc. | 489,732 | ||||||
27,957 | Atmos Energy Corp. | 1,426,925 | ||||||
18,609 | Avista Corp. | 598,279 | ||||||
9,361 | Black Hills Corp. | 540,598 | ||||||
91,593 | Calpine Corp.(b) | 2,100,227 | ||||||
120,904 | CenterPoint Energy, Inc. | 2,993,583 | ||||||
11,915 | Cleco Corp. | 626,133 | ||||||
68,727 | CMS Energy Corp. | 2,083,115 | ||||||
98,624 | Consolidated Edison, Inc. | 5,723,151 | ||||||
100,154 | Dominion Resources, Inc. | 7,265,171 | ||||||
49,503 | DTE Energy Co. | 3,868,164 | ||||||
165,072 | Duke Energy Corp. | 12,296,213 | ||||||
26,456 | Dynegy, Inc.(b) | 752,673 | ||||||
91,614 | Edison International | 5,181,688 | ||||||
80,722 | Entergy Corp. | 5,852,345 | ||||||
362,702 | Exelon Corp. | 12,705,451 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 26 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Utilities (continued) | ||||||||
208,005 | FirstEnergy Corp. | $ | 7,020,169 | |||||
44,290 | Great Plains Energy, Inc. | 1,188,301 | ||||||
35,847 | Hawaiian Electric Industries, Inc.(c) | 859,969 | ||||||
10,589 | IDACORP, Inc. | 594,466 | ||||||
30,927 | Integrys Energy Group, Inc. | 1,895,207 | ||||||
14,777 | ITC Holdings Corp. | 546,306 | ||||||
37,773 | MDU Resources Group, Inc. | 1,337,920 | ||||||
11,501 | National Fuel Gas Co. | 846,934 | ||||||
11,914 | New Jersey Resources Corp. | 592,483 | ||||||
82,423 | NextEra Energy, Inc. | 8,229,937 | ||||||
70,551 | NiSource, Inc. | 2,562,412 | ||||||
59,640 | Northeast Utilities | 2,818,586 | ||||||
9,782 | NorthWestern Corp. | 473,253 | ||||||
96,479 | NRG Energy, Inc. | 3,156,793 | ||||||
38,200 | OGE Energy Corp. | 1,426,006 | ||||||
106,001 | Pepco Holdings, Inc. | 2,836,587 | ||||||
143,031 | PG&E Corp. | 6,519,353 | ||||||
17,847 | Piedmont Natural Gas Co., Inc. | 638,744 | ||||||
34,290 | Pinnacle West Capital Corp. | 1,918,525 | ||||||
23,651 | PNM Resources, Inc. | 654,660 | ||||||
23,789 | Portland General Electric Co. | 796,218 | ||||||
161,945 | PPL Corp. | 5,399,246 | ||||||
155,902 | Public Service Enterprise Group, Inc. | 6,387,305 | ||||||
36,863 | Questar Corp. | 895,034 | ||||||
36,329 | SCANA Corp. | 1,950,141 | ||||||
44,587 | Sempra Energy | 4,396,724 | ||||||
241,392 | Southern Co. (The) | 11,062,995 | ||||||
11,406 | Southwest Gas Corp. | 627,444 | ||||||
82,533 | TECO Energy, Inc. | 1,482,293 | ||||||
30,362 | UGI Corp. | 1,417,602 | ||||||
13,169 | UIL Holdings Corp. | 483,697 | ||||||
9,352 | UNS Energy Corp. | 561,681 | ||||||
23,597 | Vectren Corp. | 957,330 | ||||||
34,570 | Westar Energy, Inc. | 1,240,372 | ||||||
18,426 | WGL Holdings, Inc. | 733,171 | ||||||
40,445 | Wisconsin Energy Corp. | 1,960,774 | ||||||
141,989 | Xcel Energy, Inc. | 4,525,189 | ||||||
|
| |||||||
175,272,656 | ||||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $2,686,186,397)—100.0% | 3,305,210,216 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—0.8% | ||||||||
27,882,011 | Invesco Liquid Assets Portfolio—Institutional Class(e)(f) (Cost $ 27,882,011) | 27,882,011 | ||||||
|
| |||||||
Total Investments (Cost $ 2,714,068,408)—100.8% | 3,333,092,227 | |||||||
Other assets less liabilities—(0.8)% | (27,395,771 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 3,305,696,456 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | Affiliated company. The Fund’s Adviser and Invesco Mortgage Capital, Inc. REIT are wholly-owned subsidiaries of Invesco Ltd., and therefore Invesco Ltd. and Invesco Mortgage Capital, Inc. REIT are considered to be affiliated. See Note 4. |
(e) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(f) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 27,275,127 | $ | (27,275,127 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 27 |
|
Schedule of Investments(a)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—17.4% | ||||||||
40,295 | 1-800-FLOWERS.COM, Inc., Class A(b) | $ | 219,608 | |||||
249,214 | Aeropostale, Inc.(b)(c) | 1,238,594 | ||||||
20,588 | AH Belo Corp., Class A | 236,968 | ||||||
19,636 | AMC Entertainment Holdings, Inc., Class A (China)(b) | 454,377 | ||||||
17,771 | AMC Networks, Inc., Class A(b) | 1,167,022 | ||||||
229,084 | American Apparel, Inc.(b)(c) | 148,080 | ||||||
36,231 | American Axle & Manufacturing Holdings, Inc.(b) | 639,477 | ||||||
7,329 | American Public Education, Inc.(b) | 253,583 | ||||||
8,680 | America’s Car-Mart, Inc.(b) | 313,695 | ||||||
49,449 | ANN, Inc.(b) | 1,937,906 | ||||||
51,649 | ARAMARK Holdings Corp. | 1,455,985 | ||||||
160,444 | Arcos Dorados Holdings, Inc., Class A (Argentina)(c) | 1,461,645 | ||||||
7,380 | Arctic Cat, Inc. | 301,768 | ||||||
30,237 | Asbury Automotive Group, Inc.(b) | 1,866,832 | ||||||
10,356 | Ascent Capital Group, Inc., Class A(b) | 712,182 | ||||||
14,993 | Bally Technologies, Inc.(b) | 976,194 | ||||||
13,141 | Bassett Furniture Industries, Inc. | 181,214 | ||||||
27,775 | Beazer Homes USA, Inc.(b) | 526,614 | ||||||
50,421 | bebe Stores, Inc. | 254,626 | ||||||
26,465 | Big 5 Sporting Goods Corp. | 323,138 | ||||||
1,302 | Biglari Holdings, Inc.(b) | 558,584 | ||||||
19,454 | BJ’s Restaurants, Inc.(b) | 555,412 | ||||||
44,372 | Bloomin’ Brands, Inc.(b) | 946,011 | ||||||
5,865 | Blue Nile, Inc.(b) | 203,691 | ||||||
36,677 | Blyth, Inc.(c) | 343,664 | ||||||
29,093 | Bob Evans Farms, Inc. | 1,363,589 | ||||||
52,451 | Body Central Corp.(b)(c) | 54,549 | ||||||
71,502 | Bon-Ton Stores, Inc. (The)(c) | 786,522 | ||||||
107,498 | Boyd Gaming Corp.(b) | 1,270,626 | ||||||
19,485 | Bravo Brio Restaurant Group, Inc.(b) | 291,690 | ||||||
16,034 | Bridgepoint Education, Inc.(b) | 254,139 | ||||||
10,133 | Bright Horizons Family Solutions, Inc.(b) | 413,224 | ||||||
58,423 | Brown Shoe Co., Inc. | 1,378,199 | ||||||
38,167 | Brunswick Corp. | 1,533,932 | ||||||
34,447 | Buckle, Inc. (The)(c) | 1,618,665 | ||||||
5,965 | Buffalo Wild Wings, Inc.(b) | 871,606 | ||||||
29,687 | Burger King Worldwide, Inc. | 775,721 | ||||||
37,882 | Burlington Stores, Inc.(b) | 984,553 | ||||||
54,545 | Callaway Golf Co. | 475,087 | ||||||
6,857 | Capella Education Co. | 400,175 | ||||||
13,028 | Carmike Cinemas, Inc.(b) | 386,410 | ||||||
10,599 | Carriage Services, Inc. | 170,538 | ||||||
39,995 | Carrols Restaurant Group, Inc.(b) | 268,366 | ||||||
32,172 | Cato Corp. (The), Class A | 916,580 | ||||||
3,448 | Cavco Industries, Inc.(b) | 268,772 | ||||||
284,057 | Central European Media Enterprises Ltd., Class A (Czech Republic)(b)(c) | 778,316 | ||||||
24,317 | Cheesecake Factory, Inc. (The) | 1,091,590 | ||||||
23,518 | Children’s Place Retail Stores, Inc. (The) | 1,128,864 | ||||||
26,625 | Choice Hotels International, Inc. | 1,176,293 | ||||||
40,102 | Christopher & Banks Corp.(b) | 250,236 | ||||||
6,303 | Churchill Downs, Inc. | 553,593 | ||||||
19,551 | Citi Trends, Inc.(b) | 332,172 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
75,525 | Clear Channel Outdoor Holdings, Inc., Class A | $ | 605,711 | |||||
13,125 | ClubCorp Holdings, Inc. | 247,275 | ||||||
7,806 | Columbia Sportswear Co. | 671,160 | ||||||
16,590 | Conn’s, Inc.(b)(c) | 733,776 | ||||||
4,281 | Container Store Group, Inc. (The)(b)(c) | 118,113 | ||||||
8,699 | Cooper-Standard Holding, Inc.(b) | 589,357 | ||||||
18,460 | Core-Mark Holding Co., Inc. | 1,486,768 | ||||||
545,929 | Corinthian Colleges, Inc.(b)(c) | 627,818 | ||||||
16,022 | Cracker Barrel Old Country Store, Inc. | 1,517,924 | ||||||
60,416 | Crocs, Inc.(b) | 914,094 | ||||||
8,836 | CSS Industries, Inc. | 211,799 | ||||||
61,778 | CTC Media, Inc. (Russia) | 535,615 | ||||||
57,291 | Cumulus Media, Inc., Class A(b) | 367,235 | ||||||
18,328 | Deckers Outdoor Corp.(b) | 1,446,996 | ||||||
10,950 | Del Frisco’s Restaurant Group, Inc.(b) | 284,810 | ||||||
10,556 | Delta Apparel, Inc.(b) | 160,768 | ||||||
75,127 | Denny’s Corp.(b) | 506,356 | ||||||
11,512 | Destination Maternity Corp. | 283,886 | ||||||
63,667 | Destination XL Group, Inc.(b) | 343,802 | ||||||
98,119 | Dex Media, Inc.(b)(c) | 719,212 | ||||||
13,578 | DineEquity, Inc. | 1,029,348 | ||||||
11,571 | Dixie Group, Inc. (The)(b) | 174,375 | ||||||
17,515 | Domino’s Pizza, Inc. | 1,302,766 | ||||||
7,520 | Dorman Products, Inc.(b) | 432,776 | ||||||
34,534 | DreamWorks Animation SKG, Inc., Class A(b) | 829,852 | ||||||
11,074 | Drew Industries, Inc. | 557,244 | ||||||
45,120 | DSW, Inc., Class A | 1,506,557 | ||||||
20,678 | Dunkin’ Brands Group, Inc. | 941,056 | ||||||
22,943 | E.W. Scripps Co. (The), Class A(b) | 393,014 | ||||||
64,691 | Education Management Corp.(b)(c) | 256,823 | ||||||
19,427 | Einstein Noah Restaurant Group, Inc. | 298,399 | ||||||
46,468 | Emmis Communications Corp., Class A(b) | 150,092 | ||||||
32,277 | Entercom Communications Corp., Class A(b) | 348,592 | ||||||
24,294 | Entravision Communications Corp., Class A | 129,001 | ||||||
24,285 | Ethan Allen Interiors, Inc. | 589,640 | ||||||
8,524 | Extended Stay America, Inc. | 183,692 | ||||||
56,044 | Federal-Mogul Corp.(b) | 965,078 | ||||||
7,230 | Fiesta Restaurant Group, Inc.(b) | 264,690 | ||||||
41,516 | Finish Line, Inc. (The), Class A | 1,142,935 | ||||||
19,530 | Five Below, Inc.(b) | 787,254 | ||||||
6,477 | Flexsteel Industries, Inc. | 222,291 | ||||||
21,981 | Francesca’s Holdings Corp.(b) | 359,609 | ||||||
51,057 | Fred’s, Inc., Class A | 930,259 | ||||||
34,169 | Fuel Systems Solutions, Inc.(b) | 358,091 | ||||||
9,600 | Gentherm, Inc.(b) | 348,960 | ||||||
12,017 | G-III Apparel Group Ltd.(b) | 862,460 | ||||||
29,516 | Gordmans Stores, Inc. | 132,527 | ||||||
10,563 | Grand Canyon Education, Inc.(b) | 455,477 | ||||||
33,028 | Gray Television, Inc.(b) | 371,565 | ||||||
75,155 | Harte-Hanks, Inc. | 604,246 | ||||||
584 | Haverty Furniture Cos., Inc., Class A | 14,436 | ||||||
14,348 | Haverty Furniture Cos., Inc. | 366,448 | ||||||
21,299 | Helen of Troy Ltd.(b) | 1,335,447 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 28 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
53,161 | hhgregg, Inc.(b)(c) | $ | 458,248 | |||||
12,258 | Hibbett Sports, Inc.(b) | 660,093 | ||||||
47,584 | Hillenbrand, Inc. | 1,446,554 | ||||||
49,508 | Hilton Worldwide Holdings, Inc.(b) | 1,080,760 | ||||||
5,836 | HomeAway, Inc.(b) | 190,370 | ||||||
11,081 | Hooker Furniture Corp. | 153,472 | ||||||
17,360 | Houghton Mifflin Harcourt Co.(b) | 354,665 | ||||||
99,349 | Hovnanian Enterprises, Inc., Class A(b)(c) | 443,097 | ||||||
20,315 | HSN, Inc. | 1,179,083 | ||||||
32,025 | Hyatt Hotels Corp., Class A(b) | 1,802,367 | ||||||
58,335 | Iao Kun Group Holding Co., Ltd. (Hong Kong)(c) | 170,922 | ||||||
31,735 | Iconix Brand Group, Inc.(b) | 1,348,738 | ||||||
21,509 | International Speedway Corp., Class A | 676,243 | ||||||
15,986 | Interval Leisure Group, Inc. | 411,959 | ||||||
9,112 | iRobot Corp.(b)(c) | 305,252 | ||||||
45,708 | Isle of Capri Casinos, Inc.(b) | 310,814 | ||||||
29,344 | Jack in the Box, Inc.(b) | 1,571,078 | ||||||
74,867 | JAKKS Pacific, Inc.(c) | 655,835 | ||||||
977 | John Wiley & Sons, Inc., Class B | 55,923 | ||||||
6,763 | Johnson Outdoors, Inc., Class A | 141,550 | ||||||
20,182 | Jos. A. Bank Clothiers, Inc.(b)(c) | 1,302,748 | ||||||
40,108 | Journal Communications, Inc., Class A(b) | 321,666 | ||||||
23,281 | K12, Inc.(b) | 551,294 | ||||||
25,844 | Kate Spade & Co.(b) | 898,596 | ||||||
53,015 | KB Home | 875,278 | ||||||
127,715 | Kingold Jewelry, Inc.(b)(c) | 141,764 | ||||||
14,158 | Kirkland’s, Inc.(b) | 242,243 | ||||||
17,012 | Krispy Kreme Doughnuts, Inc.(b) | 298,390 | ||||||
30,449 | La-Z-Boy, Inc. | 737,779 | ||||||
63,380 | LeapFrog Enterprises, Inc.(b) | 434,153 | ||||||
144,317 | Lee Enterprises, Inc.(b)(c) | 580,154 | ||||||
18,923 | Libbey, Inc.(b) | 504,676 | ||||||
36,457 | Life Time Fitness, Inc.(b) | 1,749,936 | ||||||
12,119 | Lifetime Brands, Inc. | 231,473 | ||||||
14,896 | LIN Media LLC, Class A(b) | 349,013 | ||||||
64,011 | Lincoln Educational Services Corp. | 261,165 | ||||||
46,323 | Lions Gate Entertainment Corp.(c) | 1,228,949 | ||||||
17,032 | Lithia Motors, Inc., Class A | 1,265,137 | ||||||
16,843 | Loral Space & Communications, Inc.(b) | 1,212,528 | ||||||
21,047 | Lululemon Athletica, Inc.(b)(c) | 966,689 | ||||||
5,259 | Lumber Liquidators Holdings, Inc.(b) | 458,374 | ||||||
12,981 | M/I Homes, Inc.(b) | 289,087 | ||||||
25,971 | Madison Square Garden Co. (The), Class A(b) | 1,418,017 | ||||||
29,844 | Marcus Corp. (The) | 499,290 | ||||||
26,790 | MarineMax, Inc.(b) | 430,247 | ||||||
23,094 | Marriott Vacations Worldwide Corp.(b) | 1,258,161 | ||||||
20,708 | Matthews International Corp., Class A | 835,568 | ||||||
5,750 | Mattress Firm Holding Corp.(b) | 259,843 | ||||||
197,465 | McClatchy Co. (The), Class A(b)(c) | 1,082,108 | ||||||
38,078 | MDC Holdings, Inc. | 1,050,953 | ||||||
18,249 | Media General, Inc.(b)(c) | 279,575 | ||||||
35,235 | Meredith Corp. | 1,552,806 | ||||||
18,081 | Meritage Homes Corp.(b) | 697,565 | ||||||
16,753 | Michael Kors Holdings Ltd.(b) | 1,527,874 | ||||||
43,476 | Modine Manufacturing Co.(b) | 716,484 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
10,633 | Monro Muffler Brake, Inc. | $ | 599,701 | |||||
5,334 | Morningstar, Inc. | 391,142 | ||||||
9,345 | Movado Group, Inc. | 367,072 | ||||||
7,966 | Multimedia Games Holding Co., Inc.(b) | 232,607 | ||||||
7,802 | NACCO Industries, Inc., Class A | 418,109 | ||||||
66,237 | National CineMedia, Inc. | 1,006,140 | ||||||
48,661 | New York & Co., Inc.(b) | 203,890 | ||||||
97,989 | New York Times Co. (The), Class A | 1,575,663 | ||||||
8,775 | Nexstar Broadcasting Group, Inc., Class A(c) | 349,684 | ||||||
24,301 | Norwegian Cruise Line Holdings Ltd.(b) | 796,344 | ||||||
26,627 | Nutrisystem, Inc. | 399,405 | ||||||
34,558 | Orbitz Worldwide, Inc.(b) | 254,001 | ||||||
39,972 | Orient-Express Hotels Ltd., Class A(b) | 523,633 | ||||||
22,012 | Outerwall, Inc.(b)(c) | 1,526,532 | ||||||
14,862 | Overstock.com, Inc.(b) | 238,089 | ||||||
8,210 | Oxford Industries, Inc. | 541,942 | ||||||
144,305 | Pacific Sunwear of California, Inc.(b) | 415,598 | ||||||
14,676 | Papa John’s International, Inc. | 643,689 | ||||||
85,265 | Pep Boys-Manny, Moe & Jack (The)(b) | 871,408 | ||||||
38,839 | Perry Ellis International, Inc.(b) | 586,469 | ||||||
14,801 | PetMed Express, Inc.(c) | 193,745 | ||||||
49,810 | Pier 1 Imports, Inc. | 909,531 | ||||||
53,350 | Pinnacle Entertainment, Inc.(b) | 1,241,455 | ||||||
20,443 | Pool Corp. | 1,206,546 | ||||||
4,030 | Popeyes Louisiana Kitchen, Inc.(b) | 153,543 | ||||||
154,988 | Quiksilver, Inc.(b) | 995,023 | ||||||
55,106 | Radio One, Inc., Class D(b) | 249,079 | ||||||
8,511 | Red Robin Gourmet Burgers, Inc.(b) | 578,578 | ||||||
118,532 | Regis Corp. | 1,557,510 | ||||||
16,918 | Remy International, Inc. | 448,665 | ||||||
8,059 | Restoration Hardware Holdings, Inc.(b) | 502,801 | ||||||
13,433 | Rick’s Cabaret International, Inc.(b) | 135,673 | ||||||
12,795 | Rocky Brands, Inc. | 187,319 | ||||||
208,383 | Ruby Tuesday, Inc.(b) | 1,606,633 | ||||||
22,944 | Ruth’s Hospitality Group, Inc. | 288,865 | ||||||
16,282 | Ryland Group, Inc. (The) | 625,066 | ||||||
42,030 | Scholastic Corp. | 1,383,207 | ||||||
57,982 | Scientific Games Corp., Class A(b) | 694,624 | ||||||
28,527 | Sears Hometown and Outlet Stores, Inc.(b) | 673,522 | ||||||
33,972 | Select Comfort Corp.(b) | 625,085 | ||||||
43,791 | SGOCO Group Ltd. (China)(b)(c) | 105,098 | ||||||
12,124 | Shoe Carnival, Inc. | 276,912 | ||||||
14,672 | Shutterfly, Inc.(b) | 600,525 | ||||||
35,920 | Sinclair Broadcast Group, Inc., Class A | 960,142 | ||||||
33,179 | Skechers U.S.A., Inc., Class A(b) | 1,360,007 | ||||||
38,751 | Smith & Wesson Holding Corp.(b)(c) | 594,828 | ||||||
8,195 | SodaStream International Ltd. (Israel)(b)(c) | 348,533 | ||||||
34,534 | Sonic Corp.(b) | 657,527 | ||||||
24,691 | Sotheby’s | 1,038,503 | ||||||
38,072 | Spartan Motors, Inc. | 202,162 | ||||||
14,113 | Speedway Motorsports, Inc. | 256,715 | ||||||
45,928 | Stage Stores, Inc. | 880,899 | ||||||
14,190 | Standard Motor Products, Inc. | 539,078 | ||||||
62,415 | Standard Pacific Corp.(b) | 498,696 | ||||||
37,226 | Starz, Class A(b) | 1,201,283 | ||||||
269 | Starz, Class B(b) | 8,460 | ||||||
34,017 | Stein Mart, Inc. | 425,213 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 29 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
12,823 | Steiner Leisure Ltd.(b) | $ | 553,569 | |||||
30,484 | Steven Madden Ltd.(b) | 1,085,535 | ||||||
43,307 | Stoneridge, Inc.(b) | 462,952 | ||||||
21,488 | Strayer Education, Inc.(b)(c) | 916,033 | ||||||
8,973 | Sturm Ruger & Co., Inc.(c) | 577,413 | ||||||
36,335 | Superior Industries International, Inc. | 768,122 | ||||||
21,957 | Taylor Morrison Home Corp., Class A(b) | 465,708 | ||||||
19,362 | Tempur Sealy International, Inc.(b) | 971,585 | ||||||
28,240 | Texas Roadhouse, Inc. | 698,658 | ||||||
45,144 | Tower International, Inc.(b) | 1,255,455 | ||||||
55,536 | Town Sports International Holdings, Inc. | 389,307 | ||||||
153,485 | TravelCenters of America LLC(b) | 1,161,881 | ||||||
9,748 | TripAdvisor, Inc.(b) | 787,054 | ||||||
28,983 | Tuesday Morning Corp.(b) | 405,182 | ||||||
16,406 | Tumi Holdings, Inc.(b) | 335,011 | ||||||
16,034 | Ulta Salon, Cosmetics & Fragrance, Inc.(b) | 1,406,342 | ||||||
20,607 | Under Armour, Inc., Class A(b) | 1,007,476 | ||||||
21,985 | Unifi, Inc.(b) | 486,748 | ||||||
9,053 | Universal Electronics, Inc.(b) | 338,130 | ||||||
21,112 | Universal Technical Institute, Inc. | 253,555 | ||||||
16,969 | Vail Resorts, Inc. | 1,174,764 | ||||||
37,313 | ValueVision Media, Inc., Class A(b) | 174,625 | ||||||
9,530 | Vera Bradley, Inc.(b) | 269,699 | ||||||
16,809 | Vitamin Shoppe, Inc.(b) | 804,815 | ||||||
45,304 | VOXX International Corp.(b) | 532,322 | ||||||
48,737 | Weight Watchers International, Inc. (Luxembourg)(c) | 964,993 | ||||||
23,439 | West Marine, Inc.(b) | 250,797 | ||||||
209,373 | Wet Seal, Inc. (The), Class A(b)(c) | 236,592 | ||||||
7,266 | Weyco Group, Inc. | 182,304 | ||||||
10,127 | Winnebago Industries, Inc.(b) | 242,035 | ||||||
52,223 | Wolverine World Wide, Inc. | 1,467,466 | ||||||
22,409 | World Wrestling Entertainment, Inc., Class A(c) | 436,976 | ||||||
42,419 | Zale Corp.(b) | 907,342 | ||||||
17,961 | Zumiez, Inc.(b) | 439,146 | ||||||
|
| |||||||
166,576,719 | ||||||||
|
| |||||||
Consumer Staples—4.0% | ||||||||
74,177 | Adecoagro S.A. (Argentina)(b) | 661,659 | ||||||
142,491 | Alliance One International, Inc.(b) | 366,202 | ||||||
35,373 | B&G Foods, Inc. | 1,160,234 | ||||||
1,359 | Boston Beer Co., Inc. (The), Class A(b) | 334,368 | ||||||
26,266 | Boulder Brands, Inc.(b) | 387,686 | ||||||
10,827 | Calavo Growers, Inc. | 336,611 | ||||||
11,134 | Cal-Maine Foods, Inc. | 663,920 | ||||||
23,001 | Central Garden & Pet Co.(b) | 186,998 | ||||||
72,644 | Central Garden & Pet Co., Class A(b) | 600,766 | ||||||
7,861 | Chefs’ Warehouse, Inc. (The)(b) | 157,927 | ||||||
5,128 | Coca-Cola Bottling Co. Consolidated | 421,675 | ||||||
44,448 | Coty, Inc., Class A | 713,390 | ||||||
19,572 | Diamond Foods, Inc.(b)(c) | 598,316 | ||||||
31,343 | Elizabeth Arden, Inc.(b) | 1,151,542 | ||||||
66,417 | Fresh Del Monte Produce, Inc. | 1,918,787 | ||||||
20,744 | Fresh Market, Inc. (The)(b) | 769,602 | ||||||
15,578 | Hain Celestial Group, Inc. (The)(b) | 1,340,020 | ||||||
88,336 | Harbinger Group, Inc.(b)(c) | 1,029,998 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Staples (continued) | ||||||||
21,172 | Ingles Markets, Inc., Class A | $ | 486,744 | |||||
7,083 | Inter Parfums, Inc. | 259,167 | ||||||
6,241 | J & J Snack Foods Corp. | 584,158 | ||||||
14,590 | John B. Sanfilippo & Son, Inc. | 336,300 | ||||||
11,338 | Lancaster Colony Corp. | 1,075,749 | ||||||
8,178 | Medifast, Inc.(b) | 258,834 | ||||||
22,985 | Monster Beverage Corp.(b) | 1,539,076 | ||||||
12,769 | National Beverage Corp.(b) | 246,186 | ||||||
17,960 | Nu Skin Enterprises, Inc., Class A | 1,562,520 | ||||||
9,516 | Nutraceutical International Corp.(b) | 237,139 | ||||||
26,667 | Omega Protein Corp.(b) | 302,937 | ||||||
96,793 | Pantry, Inc. (The)(b) | 1,455,767 | ||||||
45,854 | Pilgrim’s Pride Corp. (Brazil)(b) | 1,002,368 | ||||||
38,675 | Pinnacle Foods, Inc. | 1,175,720 | ||||||
26,306 | Post Holdings, Inc.(b) | 1,374,752 | ||||||
7,572 | PriceSmart, Inc. | 727,215 | ||||||
11,283 | Revlon, Inc., Class A(b) | 340,070 | ||||||
166,565 | Roundy’s, Inc. | 1,127,645 | ||||||
15,713 | Sanderson Farms, Inc. | 1,292,709 | ||||||
254 | Seaboard Corp.(b) | 619,252 | ||||||
9,098 | Seneca Foods Corp., Class A(b) | 258,383 | ||||||
1,420 | Seneca Foods Corp., Class B(b) | 43,367 | ||||||
42,044 | Snyders-Lance, Inc. | 1,116,689 | ||||||
54,939 | Spartan Stores, Inc. | 1,183,386 | ||||||
13,973 | Spectrum Brands Holdings, Inc. | 1,073,546 | ||||||
10,719 | Sprouts Farmers Market, Inc.(b) | 342,686 | ||||||
25,570 | Susser Holdings Corp.(b)(c) | 1,978,607 | ||||||
13,212 | Tootsie Roll Industries, Inc.(c) | 372,446 | ||||||
3,130 | USANA Health Sciences, Inc.(b) | 212,402 | ||||||
71,226 | Vector Group Ltd.(c) | 1,517,114 | ||||||
9,007 | Village Super Market, Inc., Class A | 217,879 | ||||||
6,413 | WD-40 Co. | 467,123 | ||||||
13,288 | Weis Markets, Inc. | 612,444 | ||||||
|
| |||||||
38,200,081 | ||||||||
|
| |||||||
Energy—8.0% | ||||||||
4,038 | Adams Resources & Energy, Inc. | 290,978 | ||||||
64,341 | Alon USA Energy, Inc. (Israel) | 1,048,115 | ||||||
4,599 | Antero Resources Corp.(b) | 302,016 | ||||||
21,158 | Approach Resources, Inc.(b)(c) | 439,029 | ||||||
44,675 | Basic Energy Services, Inc.(b) | 1,180,314 | ||||||
8,023 | Bonanza Creek Energy, Inc.(b) | 390,078 | ||||||
20,791 | Bristow Group, Inc. | 1,596,749 | ||||||
33,072 | C&J Energy Services, Inc.(b) | 994,144 | ||||||
254,009 | Cal Dive International, Inc.(b)(c) | 375,933 | ||||||
50,932 | Callon Petroleum Co.(b) | 467,556 | ||||||
7,296 | CARBO Ceramics, Inc. | 1,020,783 | ||||||
16,409 | Carrizo Oil & Gas, Inc.(b) | 902,823 | ||||||
10,649 | Cheniere Energy, Inc.(b) | 601,136 | ||||||
4,850 | Clayton Williams Energy, Inc.(b) | 700,728 | ||||||
33,889 | Clean Energy Fuels Corp.(b)(c) | 299,918 | ||||||
77,568 | Cobalt International Energy, Inc.(b) | 1,396,224 | ||||||
58,617 | Comstock Resources, Inc. | 1,629,553 | ||||||
9,484 | Contango Oil & Gas Co.(b) | 455,611 | ||||||
8,478 | Continental Resources, Inc.(b)(c) | 1,174,373 | ||||||
7,092 | Core Laboratories NV | 1,331,027 | ||||||
22,041 | CVR Energy, Inc.(c) | 1,083,315 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 30 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Energy (continued) | ||||||||
10,777 | Dawson Geophysical Co. | $ | 304,558 | |||||
66,035 | DHT Holdings, Inc. | 515,733 | ||||||
4,327 | Diamondback Energy, Inc.(b) | 311,284 | ||||||
12,852 | Dril-Quip, Inc.(b) | 1,453,818 | ||||||
41,216 | Endeavour International Corp.(b)(c) | 141,783 | ||||||
67,013 | Energy XXI Bermuda Ltd.(c) | 1,603,621 | ||||||
24,572 | Enlink Midstream LLC | 868,129 | ||||||
29,257 | EPL Oil & Gas, Inc.(b) | 1,145,119 | ||||||
14,431 | Era Group, Inc.(b) | 412,005 | ||||||
246,785 | EXCO Resources, Inc.(c) | 1,567,085 | ||||||
459,322 | Forest Oil Corp.(b) | 854,339 | ||||||
29,883 | Forum Energy Technologies, Inc.(b) | 892,306 | ||||||
11,394 | Frank’s International NV | 312,537 | ||||||
8,536 | Gaslog Ltd. (Monaco) | 228,594 | ||||||
3,949 | Geospace Technologies Corp.(b) | 229,555 | ||||||
25,099 | Golar LNG Ltd. (Norway)(c) | 1,109,376 | ||||||
25,280 | Goodrich Petroleum Corp.(b)(c) | 635,792 | ||||||
198,505 | Gran Tierra Energy, Inc. (Canada)(b) | 1,419,311 | ||||||
46,086 | Green Plains Renewable Energy, Inc. | 1,377,971 | ||||||
14,757 | Gulf Island Fabrication, Inc. | 296,025 | ||||||
5,167 | Gulfmark Offshore, Inc., Class A | 232,567 | ||||||
14,555 | Gulfport Energy Corp.(b) | 1,072,267 | ||||||
199,618 | Halcon Resources Corp.(b)(c) | 1,101,891 | ||||||
55,238 | Harvest Natural Resources, Inc.(b)(c) | 249,123 | ||||||
273,745 | Hercules Offshore, Inc.(b) | 1,223,640 | ||||||
35,637 | Hornbeck Offshore Services, Inc.(b) | 1,476,441 | ||||||
13,101 | InterOil Corp.(b)(c) | 828,114 | ||||||
165,639 | ION Geophysical Corp.(b) | 728,812 | ||||||
48,355 | Knightsbridge Tankers Ltd. (Bermuda) | 577,842 | ||||||
71,397 | Kodiak Oil & Gas Corp.(b) | 907,456 | ||||||
21,704 | Kosmos Energy Ltd.(b) | 237,008 | ||||||
19,001 | Laredo Petroleum, Inc.(b) | 555,399 | ||||||
33,380 | Magnum Hunter Resources Corp.(b) | 283,730 | ||||||
10,244 | Matador Resources Co.(b) | 294,208 | ||||||
17,297 | Matrix Service Co.(b) | 535,688 | ||||||
67,759 | Midstates Petroleum Co., Inc.(b)(c) | 399,778 | ||||||
16,360 | Mitcham Industries, Inc.(b) | 225,768 | ||||||
6,985 | Natural Gas Services Group, Inc.(b) | 214,370 | ||||||
82,162 | Newpark Resources, Inc.(b) | 989,230 | ||||||
101,909 | Nordic American Tankers Ltd. | 879,475 | ||||||
31,359 | Northern Oil and Gas, Inc.(b)(c) | 483,869 | ||||||
21,677 | Nuverra Environmental Solutions, Inc.(b)(c) | 368,726 | ||||||
20,361 | Oasis Petroleum, Inc.(b) | 946,990 | ||||||
66,252 | Ocean Rig UDW, Inc. (Greece)(b) | 1,093,158 | ||||||
51,477 | Pacific Drilling SA (Monaco)(b) | 510,137 | ||||||
29,586 | Pacific Ethanol, Inc.(b)(c) | 461,542 | ||||||
143,417 | Parker Drilling Co.(b) | 950,855 | ||||||
17,814 | PDC Energy, Inc.(b) | 1,134,217 | ||||||
57,992 | Penn Virginia Corp.(b) | 964,987 | ||||||
93,522 | PetroQuest Energy, Inc.(b) | 563,002 | ||||||
1,243 | PHI, Inc.(b) | 52,579 | ||||||
7,805 | PHI, Inc. (Non Voting)(b) | 349,664 | ||||||
102,780 | Pioneer Energy Services Corp.(b) | 1,538,617 | ||||||
288,952 | Quicksilver Resources, Inc.(b)(c) | 941,984 | ||||||
30,660 | Renewable Energy Group, Inc.(b) | 360,868 | ||||||
133,709 | Rentech, Inc.(b) | 283,463 | ||||||
57,321 | Resolute Energy Corp.(b) | 429,908 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Energy (continued) | ||||||||
5,751 | REX American Resources Corp.(b) | $ | 375,885 | |||||
18,202 | Rex Energy Corp.(b) | 383,334 | ||||||
27,115 | Rosetta Resources, Inc.(b) | 1,283,624 | ||||||
33,098 | RPC, Inc. | 735,769 | ||||||
6,856 | Sanchez Energy Corp.(b) | 193,888 | ||||||
27,188 | Scorpio Tankers, Inc. | 244,964 | ||||||
22,090 | SemGroup Corp., Class A | 1,411,109 | ||||||
79,521 | Ship Finance International Ltd. (Norway) | 1,401,955 | ||||||
30,751 | StealthGas, Inc.(b) | 333,341 | ||||||
43,313 | Stone Energy Corp.(b) | 2,124,503 | ||||||
127,512 | Swift Energy Co.(b)(c) | 1,572,223 | ||||||
221,601 | Teekay Tankers Ltd., Class A(c) | 773,387 | ||||||
33,002 | Tesco Corp.(b) | 660,040 | ||||||
98,672 | TETRA Technologies, Inc.(b) | 1,233,400 | ||||||
142,595 | Tsakos Energy Navigation Ltd. | 1,016,702 | ||||||
41,831 | Ultra Petroleum Corp.(b)(c) | 1,246,564 | ||||||
57,741 | VAALCO Energy, Inc.(b) | 532,372 | ||||||
227,437 | Vantage Drilling Co.(b)(c) | 379,820 | ||||||
49,616 | W&T Offshore, Inc. | 952,627 | ||||||
73,895 | Warren Resources, Inc.(b) | 374,648 | ||||||
16,456 | Westmoreland Coal Co.(b) | 487,262 | ||||||
114,216 | Willbros Group, Inc.(b) | 1,268,940 | ||||||
|
| |||||||
76,793,074 | ||||||||
|
| |||||||
Financials—21.2% | ||||||||
15,272 | 1st Source Corp. | 450,371 | ||||||
22,962 | 1st United Bancorp, Inc. | 168,082 | ||||||
32,572 | Acadia Realty Trust REIT | 883,678 | ||||||
61,177 | AG Mortgage Investment Trust, Inc. REIT | 1,082,221 | ||||||
8,437 | Agree Realty Corp. REIT | 252,013 | ||||||
19,240 | Alexander & Baldwin, Inc. | 717,844 | ||||||
1,376 | Alexander’s, Inc. REIT | 475,766 | ||||||
2,748 | Altisource Portfolio Solutions SA(b) | 284,995 | ||||||
27,238 | American Assets Trust, Inc. REIT | 924,730 | ||||||
8,830 | American National Bankshares, Inc. | 188,167 | ||||||
5,474 | American National Insurance Co. | 615,332 | ||||||
12,019 | Ameris Bancorp(b) | 255,644 | ||||||
12,566 | AMERISAFE, Inc. | 535,940 | ||||||
10,200 | Amreit, Inc., Class B REIT | 169,932 | ||||||
18,400 | AmTrust Financial Services, Inc.(c) | 711,528 | ||||||
337,895 | Anworth Mortgage Asset Corp. REIT | 1,824,633 | ||||||
30,720 | Apollo Commercial Real Estate Finance, Inc. REIT | 522,547 | ||||||
54,011 | Apollo Residential Mortgage, Inc. REIT | 872,278 | ||||||
40,102 | Arbor Realty Trust, Inc. REIT | 281,115 | ||||||
34,290 | Argo Group International Holdings Ltd. | 1,523,162 | ||||||
11,219 | Arlington Asset Investment Corp., Class A | 296,743 | ||||||
342,338 | ARMOUR Residential REIT, Inc. REIT | 1,451,513 | ||||||
10,438 | Arrow Financial Corp. | 261,263 | ||||||
89,790 | Ashford Hospitality Trust, Inc. REIT | 921,245 | ||||||
33,505 | Associated Estates Realty Corp. REIT | 562,214 | ||||||
1,253 | Baldwin & Lyons, Inc., Class A | 29,608 | ||||||
10,019 | Baldwin & Lyons, Inc., Class B | 260,594 | ||||||
11,555 | Banc of California, Inc. | 145,246 | ||||||
6,239 | BancFirst Corp. | 363,172 | ||||||
18,454 | Bancorp, Inc. (The)(b) | 291,942 | ||||||
44,303 | Bank Mutual Corp. | 266,704 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 31 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
4,241 | Bank of Marin Bancorp | $ | 192,584 | |||||
9,953 | Bank of the Ozarks, Inc. | 596,185 | ||||||
11,458 | Banner Corp. | 453,049 | ||||||
35,109 | BBCN Bancorp, Inc. | 541,030 | ||||||
21,273 | Beneficial Mutual Bancorp, Inc.(b) | 277,400 | ||||||
22,457 | Berkshire Hills Bancorp, Inc. | 526,168 | ||||||
77,148 | BGC Partners, Inc., Class A | 553,151 | ||||||
11,716 | Blackstone Mortgage Trust, Inc., Class A REIT | 333,086 | ||||||
11,939 | BNC Bancorp | 194,606 | ||||||
2,538 | BofI Holding, Inc.(b) | 204,588 | ||||||
19,106 | BOK Financial Corp. | 1,249,915 | ||||||
48,476 | Boston Private Financial Holdings, Inc. | 606,435 | ||||||
7,003 | Bridge Bancorp, Inc. | 170,313 | ||||||
20,329 | Brixmor Property Group, Inc. REIT | 446,425 | ||||||
90,839 | Brookline Bancorp, Inc. | 824,818 | ||||||
8,295 | Bryn Mawr Bank Corp. | 226,288 | ||||||
5,114 | C&F Financial Corp. | 159,812 | ||||||
51,189 | Calamos Asset Management, Inc., Class A | 623,482 | ||||||
8,630 | Camden National Corp. | 329,407 | ||||||
37,311 | Campus Crest Communities, Inc. REIT | 321,248 | ||||||
8,588 | Capital Bank Financial Corp., Class A(b) | 204,824 | ||||||
15,672 | Capital City Bank Group, Inc. | 217,841 | ||||||
18,162 | Cardinal Financial Corp. | 305,122 | ||||||
31,782 | Cash America International, Inc. | 1,384,106 | ||||||
42,897 | Cathay General Bancorp | 1,012,369 | ||||||
24,079 | CBOE Holdings, Inc. | 1,284,855 | ||||||
85,803 | Cedar Realty Trust, Inc. REIT | 531,121 | ||||||
9,113 | Center Bancorp, Inc. | 168,682 | ||||||
19,183 | Centerstate Banks, Inc. | 210,438 | ||||||
18,320 | Central Pacific Financial Corp. | 343,866 | ||||||
160,811 | Chambers Street Properties REIT | 1,252,718 | ||||||
19,430 | Charter Financial Corp. | 213,730 | ||||||
10,142 | Chatham Lodging Trust REIT | 206,187 | ||||||
29,363 | Chemical Financial Corp. | 824,219 | ||||||
25,959 | Chesapeake Lodging Trust REIT | 700,633 | ||||||
449,984 | Chimera Investment Corp. REIT | 1,390,451 | ||||||
11,373 | Citizens & Northern Corp. | 213,130 | ||||||
31,167 | Citizens, Inc.(b) | 204,767 | ||||||
13,854 | City Holding Co. | 595,583 | ||||||
27,694 | CNA Financial Corp. | 1,134,069 | ||||||
9,291 | CNB Financial Corp. | 153,487 | ||||||
22,580 | CoBiz Financial, Inc. | 226,703 | ||||||
12,330 | Cohen & Steers, Inc.(c) | 499,488 | ||||||
26,968 | Colony Financial, Inc. REIT | 586,554 | ||||||
30,924 | Columbia Banking System, Inc. | 767,534 | ||||||
30,762 | Community Bank System, Inc. | 1,144,039 | ||||||
12,642 | Community Trust Bancorp, Inc. | 466,111 | ||||||
31,634 | Consumer Portfolio Services, Inc.(b) | 220,805 | ||||||
9,166 | CoreSite Realty Corp. REIT | 278,830 | ||||||
74,705 | Cousins Properties, Inc. REIT | 868,819 | ||||||
59,331 | Cowen Group, Inc., Class A(b) | 243,850 | ||||||
13,851 | Crawford & Co., Class A | 133,662 | ||||||
16,278 | Crawford & Co., Class B | 185,895 | ||||||
3,786 | Credit Acceptance Corp.(b) | 497,935 | ||||||
58,611 | CubeSmart REIT | 1,090,165 | ||||||
14,796 | Customers Bancorp, Inc.(b) | 325,956 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
65,509 | CVB Financial Corp. | $ | 947,260 | |||||
19,562 | CyrusOne, Inc. REIT | 391,240 | ||||||
148,018 | DFC Global Corp.(b) | 1,379,528 | ||||||
2,247 | Diamond Hill Investment Group Inc. | 266,764 | ||||||
31,279 | Dime Community Bancshares, Inc. | 509,848 | ||||||
1,259 | Donegal Group, Inc., Class B | 31,525 | ||||||
12,027 | Donegal Group, Inc., Class A | 177,519 | ||||||
15,662 | Doral Financial Corp.(b)(c) | 149,729 | ||||||
38,430 | DuPont Fabros Technology, Inc. REIT | 931,159 | ||||||
70,372 | Dynex Capital, Inc. REIT | 603,792 | ||||||
7,940 | Eagle Bancorp, Inc.(b) | 265,117 | ||||||
18,195 | EastGroup Properties, Inc. REIT | 1,150,834 | ||||||
74,491 | Education Realty Trust, Inc. REIT | 759,808 | ||||||
4,890 | eHealth, Inc.(b) | 204,842 | ||||||
16,501 | Empire State Realty Trust, Inc., Class A REIT | 252,465 | ||||||
37,549 | Employers Holdings, Inc. | 764,122 | ||||||
12,989 | Encore Capital Group, Inc.(b) | 561,385 | ||||||
4,624 | Enstar Group Ltd.(b) | 596,958 | ||||||
14,629 | Enterprise Financial Services Corp. | 261,420 | ||||||
30,399 | Equity Lifestyle Properties, Inc. REIT | 1,272,806 | ||||||
42,416 | Equity One, Inc. REIT | 955,632 | ||||||
12,835 | Erie Indemnity Co., Class A | 919,628 | ||||||
54,511 | Everbank Financial Corp.(c) | 1,020,446 | ||||||
8,869 | Evercore Partners, Inc., Class A | 473,871 | ||||||
29,218 | Excel Trust, Inc. REIT | 368,731 | ||||||
34,684 | Extra Space Storage, Inc. REIT | 1,815,014 | ||||||
92,287 | EZCORP, Inc., Class A(b) | 962,553 | ||||||
8,537 | Farmers Capital Bank Corp.(b) | 178,338 | ||||||
13,821 | FBL Financial Group, Inc., Class A | 617,937 | ||||||
7,219 | FBR & Co.(b) | 186,250 | ||||||
7,908 | Federal Agricultural Mortgage Corp., Class C | 281,367 | ||||||
69,821 | FelCor Lodging Trust, Inc. REIT | 644,448 | ||||||
12,071 | Fidelity & Guaranty Life | 258,802 | ||||||
4,311 | Financial Engines, Inc. | 190,762 | ||||||
11,157 | Financial Institutions, Inc. | 258,285 | ||||||
16,627 | First Bancorp. | 286,151 | ||||||
194,758 | First BanCorp.(b) | 1,001,056 | ||||||
65,727 | First Busey Corp. | 361,498 | ||||||
13,062 | First Cash Financial Services, Inc.(b) | 637,034 | ||||||
4,316 | First Citizens BancShares, Inc., Class A | 970,625 | ||||||
97,443 | First Commonwealth Financial Corp. | 837,035 | ||||||
20,193 | First Community Bancshares, Inc. | 299,058 | ||||||
10,312 | First Connecticut Bancorp, Inc. | 163,445 | ||||||
10,220 | First Defiance Financial Corp. | 276,144 | ||||||
71,790 | First Financial Bancorp | 1,162,280 | ||||||
13,639 | First Financial Bankshares, Inc.(c) | 805,383 | ||||||
10,816 | First Financial Corp. | 346,220 | ||||||
8,508 | First Financial Holdings, Inc. | 488,955 | ||||||
54,209 | First Industrial Realty Trust, Inc. REIT | 995,819 | ||||||
17,858 | First Interstate BancSystem, Inc. | 444,486 | ||||||
22,727 | First Merchants Corp. | 482,267 | ||||||
59,611 | First Midwest Bancorp, Inc. | 975,832 | ||||||
4,785 | First of Long Island Corp. (The) | 173,552 | ||||||
64,042 | First Potomac Realty Trust REIT | 834,467 | ||||||
22,607 | Flagstar Bancorp, Inc.(b) | 397,883 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 32 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
29,329 | Flushing Financial Corp. | $ | 563,703 | |||||
55,865 | Forest City Enterprises, Inc., Class A(b) | 1,056,407 | ||||||
1,206 | Forest City Enterprises, Inc., Class B(b) | 22,793 | ||||||
23,914 | Forestar Group, Inc.(b) | 407,734 | ||||||
79,149 | Franklin Street Properties Corp. REIT | 964,035 | ||||||
23,771 | FXCM, Inc., Class A | 367,975 | ||||||
19,980 | Gain Capital Holdings, Inc. | 201,798 | ||||||
2,578 | GAMCO Investors, Inc., Class A | 195,748 | ||||||
46,851 | Geo Group, Inc. (The) REIT | 1,570,914 | ||||||
9,456 | German American Bancorp, Inc. | 246,234 | ||||||
25,530 | Getty Realty Corp. REIT | 483,028 | ||||||
102,121 | GFI Group, Inc. | 379,890 | ||||||
51,777 | Glacier Bancorp, Inc. | 1,328,598 | ||||||
15,184 | Gladstone Commercial Corp. REIT | 267,846 | ||||||
101,886 | Glimcher Realty Trust REIT | 1,038,218 | ||||||
7,118 | Global Indemnity PLC(b) | 190,762 | ||||||
47,281 | Government Properties Income Trust REIT | 1,203,301 | ||||||
57,572 | Gramercy Property Trust, Inc. REIT(c) | 300,526 | ||||||
11,348 | Great Southern Bancorp, Inc. | 325,347 | ||||||
22,827 | Green Dot Corp., Class A(b) | 396,505 | ||||||
18,697 | Greenhill & Co., Inc. | 937,655 | ||||||
20,365 | Greenlight Capital Re Ltd., Class A(b) | 648,218 | ||||||
29,310 | Hallmark Financial Services, Inc.(b) | 246,204 | ||||||
15,968 | Hanmi Financial Corp. | 339,639 | ||||||
3,442 | HCI Group, Inc. | 133,137 | ||||||
109,114 | Healthcare Trust of America, Inc., Class A REIT | 1,275,543 | ||||||
17,678 | Heartland Financial USA, Inc. | 429,575 | ||||||
11,724 | Heritage Financial Corp. | 189,460 | ||||||
160,482 | Hersha Hospitality Trust REIT | 932,400 | ||||||
10,591 | HFF, Inc., Class A | 360,094 | ||||||
13,991 | Home BancShares, Inc. | 443,655 | ||||||
25,849 | Home Loan Servicing Solutions Ltd. | 572,555 | ||||||
8,529 | HomeStreet, Inc. | 154,887 | ||||||
13,377 | HomeTrust Bancshares, Inc.(b) | 204,267 | ||||||
47,282 | Horace Mann Educators Corp. | 1,421,770 | ||||||
7,608 | Horizon Bancorp | 152,084 | ||||||
10,493 | Howard Hughes Corp. (The)(b) | 1,497,981 | ||||||
15,549 | Hudson Pacific Properties, Inc. REIT | 366,179 | ||||||
14,290 | Hudson Valley Holding Corp. | 262,364 | ||||||
18,928 | IBERIABANK Corp. | 1,190,571 | ||||||
10,652 | ICG Group, Inc.(b) | 217,088 | ||||||
22,972 | Impac Mortgage Holdings, Inc. REIT(b) | 132,548 | ||||||
17,093 | Independent Bank Corp. | 634,492 | ||||||
13,054 | Infinity Property & Casualty Corp. | 837,675 | ||||||
79,232 | Inland Real Estate Corp. REIT | 827,974 | ||||||
65,978 | International Bancshares Corp. | 1,514,855 | ||||||
20,242 | Intervest Bancshares Corp.(b) | 153,232 | ||||||
18,489 | INTL FCStone, Inc.(b) | 349,812 | ||||||
50,268 | Investment Technology Group, Inc.(b) | 1,037,532 | ||||||
17,198 | Investors Bancorp, Inc. | 459,703 | ||||||
119,727 | Investors Real Estate Trust REIT | 1,044,019 | ||||||
74,690 | iStar Financial, Inc. REIT(b) | 1,109,893 | ||||||
4,957 | Kansas City Life Insurance Co. | 206,112 | ||||||
8,704 | Kennedy-Wilson Holdings, Inc. | 190,095 | ||||||
83,256 | Kite Realty Group Trust REIT | 516,187 | ||||||
29,696 | Lakeland Bancorp, Inc. | 310,026 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
11,421 | Lakeland Financial Corp. | $ | 418,009 | |||||
16,209 | LTC Properties, Inc. REIT | 626,154 | ||||||
80,055 | Maiden Holdings Ltd. | 944,649 | ||||||
15,841 | MainSource Financial Group, Inc. | 261,852 | ||||||
7,311 | MarketAxess Holdings, Inc. | 393,917 | ||||||
35,002 | MB Financial, Inc. | 939,454 | ||||||
112,980 | MBIA, Inc.(b) | 1,369,318 | ||||||
134,067 | Meadowbrook Insurance Group, Inc. | 750,775 | ||||||
92,163 | Medical Properties Trust, Inc. REIT | 1,244,201 | ||||||
7,171 | Mercantile Bank Corp. | 139,906 | ||||||
4,797 | Merchants Bancshares, Inc. | 139,449 | ||||||
4,007 | Meta Financial Group, Inc. | 167,933 | ||||||
9,855 | Metro Bancorp, Inc.(b) | 201,239 | ||||||
68,624 | MGIC Investment Corp.(b) | 590,166 | ||||||
6,412 | MidWestOne Financial Group, Inc. | 157,928 | ||||||
30,129 | Monmouth Real Estate Investment Corp., Class A REIT | 282,911 | ||||||
46,194 | Montpelier Re Holdings Ltd. (Bermuda) | 1,412,613 | ||||||
4,591 | National Bankshares, Inc. | 149,575 | ||||||
8,784 | National Health Investors, Inc. REIT | 541,885 | ||||||
7,079 | National Interstate Corp. | 198,354 | ||||||
106,682 | National Penn Bancshares, Inc. | 1,042,283 | ||||||
3,036 | National Western Life Insurance Co., Class A | 708,147 | ||||||
4,970 | Nationstar Mortgage Holdings, Inc.(b)(c) | 162,668 | ||||||
13,983 | Navigators Group, Inc. (The)(b) | 796,612 | ||||||
41,242 | NBT Bancorp, Inc. | 934,131 | ||||||
19,244 | Nelnet, Inc., Class A | 813,251 | ||||||
46,685 | New York Mortgage Trust, Inc. REIT | 344,068 | ||||||
270,324 | Newcastle Investment Corp. REIT | 1,213,755 | ||||||
16,205 | NewStar Financial, Inc.(b) | 185,061 | ||||||
14,551 | Nicholas Financial, Inc. | 228,742 | ||||||
24,258 | NMI Holdings, Inc., Class A(b)(c) | 275,328 | ||||||
25,724 | Northfield Bancorp, Inc. | 333,640 | ||||||
98,711 | NorthStar Realty Finance Corp. REIT | 1,581,350 | ||||||
96,377 | Northwest Bancshares, Inc. | 1,280,850 | ||||||
10,100 | OceanFirst Financial Corp. | 163,822 | ||||||
36,410 | OFG Bancorp(c) | 621,155 | ||||||
103,845 | Old National Bancorp | 1,466,291 | ||||||
8,888 | OmniAmerican Bancorp, Inc. | 220,956 | ||||||
11,826 | One Liberty Properties, Inc. REIT | 261,709 | ||||||
30,953 | OneBeacon Insurance Group Ltd., Class A | 477,914 | ||||||
11,664 | Oppenheimer Holdings, Inc., Class A | 296,965 | ||||||
30,330 | Oritani Financial Corp. | 449,794 | ||||||
13,372 | Pacific Continental Corp. | 176,243 | ||||||
9,011 | Pacific Premier Bancorp, Inc.(b) | 123,000 | ||||||
17,881 | PacWest Bancorp | 703,975 | ||||||
12,124 | Park National Corp.(c) | 879,232 | ||||||
29,303 | Park Sterling Corp. | 191,349 | ||||||
28,108 | Parkway Properties, Inc. REIT | 530,117 | ||||||
26,954 | Pebblebrook Hotel Trust REIT | 928,296 | ||||||
3,801 | Penns Woods Bancorp, Inc. | 167,244 | ||||||
61,630 | Pennsylvania Real Estate Investment Trust REIT | 1,019,977 | ||||||
59,985 | PennyMac Mortgage Investment Trust REIT | 1,406,048 | ||||||
10,749 | Peoples Bancorp, Inc. | 280,226 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 33 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
29,124 | Phoenix Cos., Inc. (The)(b) | $ | 1,282,038 | |||||
13,132 | PICO Holdings, Inc.(b) | 305,319 | ||||||
20,201 | Pinnacle Financial Partners, Inc. | 698,349 | ||||||
19,686 | Piper Jaffray Cos.(b) | 863,428 | ||||||
16,819 | Portfolio Recovery Associates, Inc.(b) | 961,206 | ||||||
28,707 | Post Properties, Inc. REIT | 1,441,378 | ||||||
31,708 | Potlatch Corp. REIT | 1,212,197 | ||||||
37,867 | PrivateBancorp, Inc. | 1,043,993 | ||||||
9,580 | Provident Financial Holdings, Inc. | 134,791 | ||||||
62,863 | Provident Financial Services, Inc. | 1,092,559 | ||||||
10,696 | PS Business Parks, Inc. REIT | 917,396 | ||||||
50,008 | Radian Group, Inc. | 699,112 | ||||||
97,556 | RAIT Financial Trust REIT | 798,008 | ||||||
41,000 | Ramco-Gershenson Properties Trust REIT | 675,680 | ||||||
81,900 | Redwood Trust, Inc. REIT | 1,785,420 | ||||||
7,344 | Regional Management Corp.(b) | 112,657 | ||||||
22,221 | Renasant Corp. | 604,856 | ||||||
11,107 | Republic Bancorp, Inc., Class A | 266,679 | ||||||
153,024 | Resource Capital Corp. REIT | 841,632 | ||||||
27,802 | Retail Opportunity Investments Corp. REIT | 434,823 | ||||||
17,582 | Rouse Properties, Inc. REIT | 295,202 | ||||||
30,990 | Ryman Hospitality Properties, Inc. REIT(c) | 1,411,595 | ||||||
27,594 | S&T Bancorp, Inc. | 641,836 | ||||||
38,751 | Sabra Health Care REIT, Inc. REIT | 1,161,367 | ||||||
10,646 | Safeguard Scientifics, Inc.(b) | 223,672 | ||||||
17,931 | Safety Insurance Group, Inc. | 963,074 | ||||||
21,623 | Sandy Spring Bancorp, Inc. | 520,033 | ||||||
8,832 | Saul Centers, Inc. REIT | 405,300 | ||||||
48,437 | SEI Investments Co. | 1,568,390 | ||||||
18,724 | Select Income REIT | 576,325 | ||||||
69,494 | Selective Insurance Group, Inc. | 1,594,192 | ||||||
9,113 | Sierra Bancorp | 142,254 | ||||||
25,585 | Silver Bay Realty Trust Corp. REIT | 383,263 | ||||||
13,012 | Simmons First National Corp., Class A | 470,514 | ||||||
17,076 | Southside Bancshares, Inc. | 470,956 | ||||||
15,119 | Southwest Bancorp, Inc. | 252,487 | ||||||
16,409 | Sovran Self Storage, Inc. REIT | 1,245,443 | ||||||
90,704 | Spirit Realty Capital, Inc. REIT | 976,882 | ||||||
15,006 | Springleaf Holdings, Inc.(b) | 344,838 | ||||||
23,229 | St. Joe Co. (The)(b)(c) | 414,638 | ||||||
13,773 | STAG Industrial, Inc. REIT | 324,079 | ||||||
15,576 | State Auto Financial Corp. | 318,685 | ||||||
23,359 | State Bank Financial Corp. | 387,292 | ||||||
36,804 | Sterling Bancorp | 440,176 | ||||||
21,783 | Stewart Information Services Corp. | 664,382 | ||||||
9,672 | Stock Yards Bancorp, Inc. | 285,131 | ||||||
63,720 | Strategic Hotels & Resorts, Inc. REIT(b) | 687,539 | ||||||
11,200 | Suffolk Bancorp(b) | 245,616 | ||||||
47,435 | Summit Hotel Properties, Inc. REIT | 429,761 | ||||||
21,748 | Sun Communities, Inc. REIT | 991,056 | ||||||
94,989 | Sunstone Hotel Investors, Inc. REIT | 1,359,293 | ||||||
52,069 | SWS Group, Inc.(b) | 385,831 | ||||||
40,192 | Tanger Factory Outlet Centers, Inc. REIT | 1,434,051 | ||||||
8,823 | Taylor Capital Group, Inc.(b) | 187,842 | ||||||
4,425 | Tejon Ranch Co.(b) | 137,219 | ||||||
7,757 | Terreno Realty Corp. REIT | 141,720 | ||||||
8,854 | Territorial Bancorp, Inc. | 181,153 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
17,047 | Texas Capital Bancshares, Inc.(b) | $ | 957,871 | |||||
46,159 | TFS Financial Corp.(b) | 618,069 | ||||||
12,032 | Third Point Reinsurance Ltd. (Bermuda)(b) | 188,180 | ||||||
8,554 | Tompkins Financial Corp. | 403,236 | ||||||
481,395 | Tower Group International Ltd.(c) | 1,184,232 | ||||||
25,901 | TowneBank | 399,652 | ||||||
14,364 | TriCo Bancshares | 348,327 | ||||||
96,501 | TrustCo Bank Corp. NY | 637,872 | ||||||
22,872 | UMB Financial Corp. | 1,342,815 | ||||||
16,241 | UMH Properties, Inc. REIT | 159,974 | ||||||
92,377 | Umpqua Holdings Corp. | 1,536,230 | ||||||
19,540 | Union Bankshares Corp. | 500,029 | ||||||
46,666 | United Bankshares, Inc. | 1,364,981 | ||||||
18,811 | United Community Banks, Inc.(b) | 303,798 | ||||||
23,679 | United Financial Bancorp, Inc. | 311,616 | ||||||
21,686 | United Fire Group, Inc. | 603,305 | ||||||
6,310 | Universal Health Realty Income Trust REIT | 267,733 | ||||||
25,125 | Universal Insurance Holdings, Inc. | 367,579 | ||||||
21,819 | Univest Corp. of Pennsylvania | 430,052 | ||||||
2,582 | Urstadt Biddle Properties, Inc. REIT | 45,288 | ||||||
18,901 | Urstadt Biddle Properties, Inc., Class A REIT | 385,769 | ||||||
19,130 | ViewPoint Financial Group, Inc. | 498,719 | ||||||
1,312 | Virtus Investment Partners, Inc.(b) | 242,707 | ||||||
12,982 | Walker & Dunlop, Inc.(b) | 203,558 | ||||||
28,726 | Walter Investment Management Corp.(b)(c) | 763,537 | ||||||
11,947 | Washington Banking Co. | 205,488 | ||||||
12,140 | Washington Trust Bancorp, Inc. | 415,188 | ||||||
20,801 | Waterstone Financial, Inc. | 216,538 | ||||||
30,258 | WesBanco, Inc. | 915,002 | ||||||
21,739 | Westamerica Bancorp.(c) | 1,104,776 | ||||||
29,801 | Western Alliance Bancorp(b) | 687,509 | ||||||
15,978 | Western Asset Mortgage Capital Corp. REIT | 235,995 | ||||||
22,891 | Westfield Financial, Inc. | 156,803 | ||||||
4,156 | Westwood Holdings Group, Inc. | 241,755 | ||||||
13,374 | Whitestone REIT | 187,637 | ||||||
34,990 | Wilshire Bancorp, Inc. | 349,900 | ||||||
33,672 | Winthrop Realty Trust REIT | 468,041 | ||||||
24,804 | Wintrust Financial Corp. | 1,111,715 | ||||||
7,684 | World Acceptance Corp.(b)(c) | 557,858 | ||||||
4,827 | WSFS Financial Corp. | 326,402 | ||||||
8,750 | Yadkin Financial Corp.(b)(c) | 167,563 | ||||||
|
| |||||||
203,311,368 | ||||||||
|
| |||||||
Health Care—7.4% | ||||||||
6,148 | Abaxis, Inc.(b) | 249,670 | ||||||
5,233 | Acadia Healthcare Co., Inc.(b) | 219,891 | ||||||
19,213 | Accuray, Inc.(b)(c) | 161,389 | ||||||
8,529 | Acorda Therapeutics, Inc.(b) | 302,353 | ||||||
44,755 | Affymetrix, Inc.(b) | 332,530 | ||||||
13,422 | Air Methods Corp.(b) | 747,203 | ||||||
6,839 | Akorn, Inc.(b) | 172,480 | ||||||
11,916 | Albany Molecular Research, Inc.(b) | 191,371 | ||||||
11,015 | Align Technology, Inc.(b) | 555,046 | ||||||
14,135 | Alkermes PLC(b) | 653,885 | ||||||
9,948 | Alliance HealthCare Services, Inc.(b) | 283,120 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 34 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
82,725 | Allscripts Healthcare Solutions, Inc.(b) | $ | 1,259,074 | |||||
9,689 | Almost Family, Inc.(b) | 208,023 | ||||||
82,998 | Amedisys, Inc.(b) | 1,131,263 | ||||||
44,003 | AMN Healthcare Services, Inc.(b) | 549,157 | ||||||
31,923 | Amsurg Corp.(b) | 1,382,585 | ||||||
5,158 | Analogic Corp. | 387,263 | ||||||
24,510 | AngioDynamics, Inc.(b) | 329,414 | ||||||
11,794 | ArthroCare Corp.(b) | 572,363 | ||||||
2,083 | athenahealth, Inc.(b) | 257,542 | ||||||
865 | Atrion Corp. | 249,405 | ||||||
6,576 | Auxilium Pharmaceuticals, Inc.(b) | 148,026 | ||||||
10,158 | BioMarin Pharmaceutical, Inc.(b) | 591,500 | ||||||
18,672 | Bio-Reference Labs, Inc.(b)(c) | 474,269 | ||||||
79,618 | BioScrip, Inc.(b) | 550,957 | ||||||
48,045 | Brookdale Senior Living, Inc.(b) | 1,529,753 | ||||||
46,410 | Bruker Corp.(b) | 958,831 | ||||||
13,984 | Cambrex Corp.(b) | 286,532 | ||||||
7,373 | Cantel Medical Corp. | 244,489 | ||||||
11,636 | Capital Senior Living Corp.(b) | 287,758 | ||||||
5,140 | Cepheid, Inc.(b) | 223,487 | ||||||
27,439 | Charles River Laboratories International, Inc.(b) | 1,474,023 | ||||||
10,910 | Chemed Corp.(c) | 908,476 | ||||||
5,034 | Computer Programs & Systems, Inc. | 317,796 | ||||||
15,890 | CONMED Corp. | 736,184 | ||||||
5,077 | Corvel Corp.(b) | 231,207 | ||||||
39,821 | Cross Country Healthcare, Inc.(b) | 282,331 | ||||||
18,323 | Cubist Pharmaceuticals, Inc.(b) | 1,283,709 | ||||||
5,150 | Cyberonics, Inc.(b) | 304,674 | ||||||
6,171 | Cynosure, Inc., Class A(b) | 151,436 | ||||||
13,100 | Emergent Biosolutions, Inc.(b) | 345,316 | ||||||
31,295 | Emeritus Corp.(b) | 933,530 | ||||||
12,488 | Ensign Group, Inc. (The) | 530,740 | ||||||
16,377 | Envision Healthcare Holdings, Inc.(b) | 553,379 | ||||||
283,828 | Enzon Pharmaceuticals, Inc. | 252,635 | ||||||
6,476 | Exactech, Inc.(b) | 143,897 | ||||||
8,555 | ExamWorks Group, Inc.(b) | 314,824 | ||||||
35,164 | Exelixis, Inc.(b)(c) | 124,481 | ||||||
117,864 | Five Star Quality Care, Inc.(b) | 569,283 | ||||||
104,080 | Gentiva Health Services, Inc.(b) | 783,722 | ||||||
15,767 | Globus Medical, Inc., Class A(b) | 385,030 | ||||||
18,971 | Greatbatch, Inc.(b) | 873,235 | ||||||
30,486 | Haemonetics Corp.(b) | 925,555 | ||||||
27,777 | Hanger, Inc.(b) | 963,029 | ||||||
46,414 | Healthways, Inc.(b)(c) | 835,452 | ||||||
40,700 | Hill-Rom Holdings, Inc. | 1,520,552 | ||||||
32,853 | HMS Holdings Corp.(b) | 531,233 | ||||||
25,476 | ICON PLC (Ireland)(b) | 987,705 | ||||||
8,063 | ICU Medical, Inc.(b) | 449,754 | ||||||
12,754 | IDEXX Laboratories, Inc.(b) | 1,612,616 | ||||||
46,266 | Impax Laboratories, Inc.(b) | 1,209,856 | ||||||
15,220 | Infinity Pharmaceuticals, Inc.(b) | 148,699 | ||||||
15,212 | Integra LifeSciences Holdings Corp.(b) | 693,363 | ||||||
49,266 | Invacare Corp. | 778,403 | ||||||
7,997 | IPC The Hospitalist Co., Inc.(b) | 323,878 | ||||||
2,802 | Isis Pharmaceuticals, Inc.(b) | 74,561 | ||||||
5,374 | Jazz Pharmaceuticals PLC(b) | 724,953 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
8,043 | Landauer, Inc. | $ | 347,779 | |||||
15,795 | LHC Group, Inc.(b) | 328,220 | ||||||
14,398 | Luminex Corp.(b) | 276,586 | ||||||
29,638 | Masimo Corp.(b) | 793,113 | ||||||
36,050 | MedAssets, Inc.(b) | 823,022 | ||||||
32,617 | Medical Action Industries, Inc.(b) | 209,075 | ||||||
21,746 | Medicines Co. (The)(b) | 578,444 | ||||||
2,847 | Medidata Solutions, Inc.(b) | 103,375 | ||||||
26,595 | Meridian Bioscience, Inc. | 531,102 | ||||||
31,550 | Merit Medical Systems, Inc.(b) | 406,049 | ||||||
15,417 | Momenta Pharmaceuticals, Inc.(b) | 176,062 | ||||||
5,700 | MWI Veterinary Supply, Inc.(b) | 892,848 | ||||||
21,447 | Myriad Genetics, Inc.(b)(c) | 905,278 | ||||||
9,192 | National Healthcare Corp. | 503,078 | ||||||
12,546 | Natus Medical, Inc.(b) | 311,517 | ||||||
7,294 | Neogen Corp.(b) | 304,707 | ||||||
18,824 | NuVasive, Inc.(b) | 634,557 | ||||||
14,785 | NxStage Medical, Inc.(b) | 169,140 | ||||||
12,835 | Omnicell, Inc.(b) | 339,871 | ||||||
28,522 | Orthofix International NV(b) | 861,364 | ||||||
25,675 | PAREXEL International Corp.(b) | 1,164,361 | ||||||
55,752 | PharMerica Corp.(b) | 1,515,897 | ||||||
28,359 | Prestige Brands Holdings, Inc.(b) | 950,594 | ||||||
21,691 | Providence Service Corp. (The)(b) | 880,872 | ||||||
41,746 | QLT, Inc. (Canada)(b) | 241,709 | ||||||
39,249 | Quality Systems, Inc. | 579,708 | ||||||
5,032 | Questcor Pharmaceuticals, Inc. | 413,530 | ||||||
7,829 | Quidel Corp.(b) | 167,932 | ||||||
8,896 | Quintiles Transnational Holdings, Inc.(b) | 419,268 | ||||||
126,368 | RadNet, Inc.(b) | 628,049 | ||||||
2,513 | Regeneron Pharmaceuticals, Inc.(b) | 746,085 | ||||||
54,420 | Rigel Pharmaceuticals, Inc.(b) | 174,144 | ||||||
61,132 | RTI Surgical, Inc.(b) | 262,868 | ||||||
7,283 | Salix Pharmaceuticals Ltd.(b) | 801,130 | ||||||
32,304 | SciClone Pharmaceuticals, Inc.(b) | 154,413 | ||||||
2,944 | Seattle Genetics, Inc.(b) | 113,285 | ||||||
63,615 | Select Medical Holdings Corp. | 888,065 | ||||||
23,381 | Sirona Dental Systems, Inc.(b) | 1,758,719 | ||||||
42,440 | Skilled Healthcare Group, Inc., Class A(b) | 218,990 | ||||||
25,575 | Spectrum Pharmaceuticals, Inc.(b)(c) | 175,700 | ||||||
7,281 | Surgical Care Affiliates, Inc.(b) | 213,916 | ||||||
7,094 | SurModics, Inc.(b) | 154,365 | ||||||
48,878 | Symmetry Medical, Inc.(b) | 403,732 | ||||||
14,578 | Syneron Medical Ltd. (Israel)(b) | 151,174 | ||||||
3,780 | Taro Pharmaceutical Industries Ltd. (India)(b) | 424,607 | ||||||
25,377 | Team Health Holdings, Inc.(b) | 1,230,277 | ||||||
10,882 | Techne Corp. | 971,871 | ||||||
22,794 | Thoratec Corp.(b) | 747,187 | ||||||
11,326 | Tornier NV(b) | 192,202 | ||||||
55,935 | Triple-S Management Corp., Class B(b) | 837,906 | ||||||
13,910 | United Therapeutics Corp.(b) | 1,391,139 | ||||||
80,686 | Universal American Corp. | 578,519 | ||||||
7,451 | US Physical Therapy, Inc. | 229,863 | ||||||
11,068 | Vertex Pharmaceuticals, Inc.(b) | 749,304 | ||||||
22,927 | VIVUS, Inc.(b)(c) | 119,220 | ||||||
22,984 | Volcano Corp.(b) | 403,599 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 35 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
29,040 | West Pharmaceutical Services, Inc. | $ | 1,259,755 | |||||
18,335 | Wright Medical Group, Inc.(b) | 501,462 | ||||||
|
| |||||||
71,080,750 | ||||||||
|
| |||||||
Industrials—16.8% | ||||||||
25,538 | A.O. Smith Corp. | 1,194,157 | ||||||
8,428 | AAON, Inc. | 238,934 | ||||||
51,574 | AAR Corp. | 1,335,767 | ||||||
38,120 | Acacia Research Corp.(c) | 611,445 | ||||||
194,528 | ACCO Brands Corp.(b) | 1,192,457 | ||||||
116,304 | Accuride Corp.(b) | 655,955 | ||||||
16,783 | Aceto Corp. | 367,212 | ||||||
38,777 | Actuant Corp., Class A | 1,312,989 | ||||||
12,501 | Acuity Brands, Inc. | 1,557,250 | ||||||
6,718 | Advisory Board Co. (The)(b) | 384,673 | ||||||
115,513 | Aegean Marine Petroleum Network, Inc. (Greece) | 1,066,185 | ||||||
50,214 | Aegion Corp.(b) | 1,279,955 | ||||||
8,325 | Aerovironment, Inc.(b) | 281,135 | ||||||
70,323 | Air Transport Services Group, Inc.(b) | 550,629 | ||||||
87,972 | Aircastle Ltd. | 1,545,668 | ||||||
6,392 | Alamo Group, Inc. | 339,543 | ||||||
18,075 | Albany International Corp., Class A | 650,338 | ||||||
2,294 | Allegiant Travel Co. | 269,430 | ||||||
32,348 | Allison Transmission Holdings, Inc. | 965,264 | ||||||
13,888 | Altra Industrial Motion Corp. | 474,414 | ||||||
6,542 | AMERCO | 1,636,220 | ||||||
24,983 | Ameresco, Inc., Class A(b) | 160,141 | ||||||
3,556 | American Railcar Industries, Inc. | 246,929 | ||||||
6,236 | American Science & Engineering, Inc. | 419,059 | ||||||
6,025 | American Woodmark Corp.(b) | 180,810 | ||||||
15,354 | Apogee Enterprises, Inc. | 487,797 | ||||||
26,978 | Applied Industrial Technologies, Inc. | 1,292,786 | ||||||
48,747 | ARC Document Solutions, Inc.(b) | 311,981 | ||||||
25,831 | ArcBest Corp. | 1,018,258 | ||||||
15,833 | Astec Industries, Inc. | 632,528 | ||||||
2,604 | Astronics Corp.(b) | 148,740 | ||||||
53,545 | Atlas Air Worldwide Holdings, Inc.(b) | 1,873,540 | ||||||
13,472 | AZZ, Inc. | 584,954 | ||||||
35,116 | Baltic Trading Ltd. | 210,345 | ||||||
31,815 | Barnes Group, Inc. | 1,225,514 | ||||||
2,495 | Barrett Business Services, Inc. | 125,773 | ||||||
38,532 | Beacon Roofing Supply, Inc.(b) | 1,370,969 | ||||||
45,877 | Blount International, Inc.(b) | 512,446 | ||||||
85,265 | Box Ships, Inc.(c) | 134,719 | ||||||
59,572 | Brady Corp., Class A | 1,536,362 | ||||||
67,677 | Briggs & Stratton Corp. | 1,446,257 | ||||||
18,699 | Builders FirstSource, Inc.(b) | 146,787 | ||||||
10,011 | CAI International, Inc.(b) | 217,739 | ||||||
53,597 | Casella Waste Systems, Inc., Class A(b) | 273,345 | ||||||
66,164 | CBIZ, Inc.(b) | 567,025 | ||||||
22,569 | CDI Corp. | 345,757 | ||||||
18,396 | Celadon Group, Inc. | 423,292 | ||||||
208,327 | Cenveo, Inc.(b)(c) | 643,730 | ||||||
12,159 | Chart Industries, Inc.(b) | 829,487 | ||||||
29,235 | China Yuchai International Ltd. | 588,793 | ||||||
8,678 | CIRCOR International, Inc. | 704,740 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
22,881 | CLARCOR, Inc. | $ | 1,321,607 | |||||
21,192 | Columbus McKinnon Corp.(b) | 561,376 | ||||||
43,379 | Comfort Systems USA, Inc. | 650,685 | ||||||
48,803 | Commercial Vehicle Group, Inc.(b) | 473,877 | ||||||
34,958 | Copart, Inc.(b) | 1,267,927 | ||||||
11,246 | Corporate Executive Board Co. (The) | 776,199 | ||||||
16,747 | Costamare, Inc. (Greece)(c) | 359,056 | ||||||
16,773 | Courier Corp. | 243,712 | ||||||
11,797 | CRA International, Inc.(b) | 256,821 | ||||||
13,985 | Cubic Corp. | 663,309 | ||||||
32,846 | Danaos Corp. (Greece)(b) | 191,164 | ||||||
62,291 | Diana Containerships, Inc. (Greece)(c) | 234,526 | ||||||
94,882 | Diana Shipping, Inc. (Greece)(b)(c) | 1,068,371 | ||||||
18,837 | DigitalGlobe, Inc.(b) | 560,966 | ||||||
20,687 | Douglas Dynamics, Inc. | 348,990 | ||||||
15,455 | Ducommun, Inc.(b) | 375,093 | ||||||
4,092 | DXP Enterprises, Inc.(b) | 463,255 | ||||||
38,727 | Dycom Industries, Inc.(b) | 1,216,028 | ||||||
8,646 | Dynamic Materials Corp. | 174,649 | ||||||
193,034 | Eagle Bulk Shipping, Inc.(b)(c) | 563,659 | ||||||
12,135 | Echo Global Logistics, Inc.(b) | 237,361 | ||||||
12,514 | Encore Wire Corp. | 609,807 | ||||||
10,706 | EnerNOC, Inc.(b) | 252,662 | ||||||
30,422 | Engility Holdings, Inc.(b) | 1,327,616 | ||||||
44,795 | Ennis, Inc. | 670,133 | ||||||
14,324 | EnPro Industries, Inc.(b) | 1,020,012 | ||||||
21,691 | ESCO Technologies, Inc. | 724,913 | ||||||
5,291 | Exponent, Inc. | 372,592 | ||||||
39,055 | Federal Signal Corp.(b) | 592,855 | ||||||
13,470 | Forward Air Corp. | 595,778 | ||||||
16,797 | Franklin Electric Co., Inc. | 649,540 | ||||||
11,324 | FreightCar America, Inc. | 297,368 | ||||||
21,330 | Furmanite Corp.(b) | 223,538 | ||||||
17,155 | G&K Services, Inc., Class A | 908,186 | ||||||
26,498 | GenCorp, Inc.(b)(c) | 465,305 | ||||||
33,052 | Gibraltar Industries, Inc.(b) | 564,528 | ||||||
32,248 | Global Brass & Copper Holdings, Inc. | 511,453 | ||||||
20,818 | Global Power Equipment Group, Inc. | 364,939 | ||||||
9,370 | Gorman-Rupp Co. (The) | 290,938 | ||||||
9,578 | GP Strategies Corp.(b) | 251,710 | ||||||
20,091 | Graco, Inc. | 1,456,597 | ||||||
36,401 | Granite Construction, Inc. | 1,360,669 | ||||||
67,738 | Great Lakes Dredge & Dock Corp.(b) | 584,579 | ||||||
20,010 | Greenbrier Cos., Inc. (The)(b) | 1,049,324 | ||||||
59,930 | Griffon Corp. | 637,655 | ||||||
30,745 | H&E Equipment Services, Inc.(b) | 1,185,220 | ||||||
13,621 | Hardinge, Inc. | 181,977 | ||||||
27,078 | Hawaiian Holdings, Inc.(b) | 391,277 | ||||||
50,269 | HD Supply Holdings, Inc.(b) | 1,295,935 | ||||||
35,334 | Healthcare Services Group, Inc. | 1,028,219 | ||||||
33,087 | Heartland Express, Inc. | 719,973 | ||||||
5,396 | HEICO Corp. | 298,507 | ||||||
9,978 | HEICO Corp., Class A | 406,603 | ||||||
23,682 | Heidrick & Struggles International, Inc. | 446,406 | ||||||
39,049 | Herman Miller, Inc. | 1,203,881 | ||||||
44,593 | HNI Corp. | 1,571,011 | ||||||
17,724 | Houston Wire & Cable Co. | 220,841 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 36 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
38,522 | Hub Group, Inc., Class A(b) | $ | 1,720,007 | |||||
6,590 | Hurco Cos., Inc. | 175,689 | ||||||
12,479 | Huron Consulting Group, Inc.(b) | 888,505 | ||||||
6,354 | Hyster-Yale Materials Handling, Inc. | 612,462 | ||||||
15,387 | ICF International, Inc.(b) | 599,631 | ||||||
46,556 | InnerWorkings, Inc.(b) | 335,203 | ||||||
29,183 | Insperity, Inc. | 935,607 | ||||||
13,982 | Insteel Industries, Inc. | 287,750 | ||||||
38,894 | Interface, Inc. | 699,703 | ||||||
9,265 | International Shipholding Corp. | 249,599 | ||||||
25,667 | Intersections, Inc. | 144,249 | ||||||
17,459 | Jinpan International Ltd. (China) | 128,673 | ||||||
20,830 | John Bean Technologies Corp. | 603,862 | ||||||
10,510 | Kadant, Inc. | 365,222 | ||||||
25,596 | Kaman Corp. | 1,074,264 | ||||||
70,116 | Kelly Services, Inc., Class A | 1,476,643 | ||||||
12,507 | KEYW Holding Corp. (The)(b) | 160,715 | ||||||
21,135 | Kforce, Inc. | 488,641 | ||||||
32,692 | Kimball International, Inc., Class B | 547,918 | ||||||
39,138 | Knight Transportation, Inc. | 928,745 | ||||||
45,842 | Knoll, Inc. | 833,866 | ||||||
33,571 | Korn/Ferry International(b) | 975,238 | ||||||
64,209 | Kratos Defense & Security Solutions, Inc.(b) | 463,589 | ||||||
26,537 | Landstar System, Inc. | 1,671,566 | ||||||
51,421 | Layne Christensen Co.(b) | 895,754 | ||||||
8,013 | LB Foster Co., Class A | 379,416 | ||||||
41,818 | Lihua International, Inc. (China)(b)(c) | 88,654 | ||||||
5,014 | Lindsay Corp.(c) | 441,884 | ||||||
16,162 | LMI Aerospace, Inc.(b)(c) | 220,450 | ||||||
9,163 | LS Starrett Co. (The), Class A | 143,126 | ||||||
31,109 | LSI Industries, Inc. | 236,739 | ||||||
15,256 | Lydall, Inc.(b) | 357,143 | ||||||
27,068 | Macquarie Infrastructure Co. LLC (Australia) | 1,556,951 | ||||||
20,089 | Marten Transport Ltd. | 471,288 | ||||||
12,346 | Masonite International Corp.(b) | 680,265 | ||||||
45,121 | MasTec, Inc.(b) | 1,785,889 | ||||||
262,065 | Matson, Inc. | 6,208,320 | ||||||
18,563 | McGrath RentCorp | 586,220 | ||||||
124,033 | Metalico, Inc.(b) | 191,011 | ||||||
69,599 | MFC Industrial Ltd. (Canada)(c) | 519,209 | ||||||
3,819 | Middleby Corp. (The)(b) | 964,221 | ||||||
11,840 | Miller Industries, Inc. | 229,341 | ||||||
12,143 | Mistras Group, Inc.(b) | 275,767 | ||||||
26,407 | Mobile Mini, Inc. | 1,166,661 | ||||||
22,261 | MSA Safety, Inc. | 1,174,268 | ||||||
36,988 | Mueller Industries, Inc. | 1,070,433 | ||||||
92,701 | Mueller Water Products, Inc., Class A | 845,433 | ||||||
11,444 | Multi-Color Corp. | 398,823 | ||||||
26,431 | MYR Group, Inc.(b) | 620,071 | ||||||
9,424 | National Presto Industries, Inc.(c) | 680,978 | ||||||
56,123 | Navigant Consulting, Inc.(b) | 942,866 | ||||||
117,465 | Navios Maritime Holdings, Inc.(c) | 924,450 | ||||||
13,457 | NCI Building Systems, Inc.(b) | 210,467 | ||||||
10,232 | NN, Inc. | 200,240 | ||||||
20,250 | Nordson Corp. | 1,505,587 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
12,062 | Nortek, Inc.(b) | $ | 991,014 | |||||
12,774 | Northwest Pipe Co.(b) | 456,926 | ||||||
19,567 | On Assignment, Inc.(b) | 684,845 | ||||||
45,985 | Orbital Sciences Corp.(b) | 1,351,959 | ||||||
34,352 | Orion Marine Group, Inc.(b) | 402,949 | ||||||
41,080 | Paragon Shipping, Inc., Class A (Greece)(b)(c) | 230,459 | ||||||
8,129 | Park-Ohio Holdings Corp.(b) | 474,652 | ||||||
46,659 | Pike Corp.(b) | 447,926 | ||||||
14,366 | Ply Gem Holdings, Inc.(b) | 183,166 | ||||||
25,900 | PMFG, Inc.(b) | 146,853 | ||||||
33,575 | Polypore International, Inc.(b)(c) | 1,164,381 | ||||||
7,404 | Powell Industries, Inc. | 468,821 | ||||||
2,467 | Preformed Line Products Co. | 147,428 | ||||||
12,912 | Primoris Services Corp. | 361,278 | ||||||
66,317 | Quad Graphics, Inc. | 1,435,763 | ||||||
32,301 | Quality Distribution, Inc.(b) | 406,024 | ||||||
32,457 | Quanex Building Products Corp. | 611,490 | ||||||
16,189 | Raven Industries, Inc. | 500,240 | ||||||
9,935 | RBC Bearings, Inc.(b) | 618,553 | ||||||
34,477 | Resources Connection, Inc. | 469,232 | ||||||
25,147 | Rexnord Corp.(b) | 672,431 | ||||||
21,177 | Roadrunner Transportation Systems, Inc.(b) | 521,589 | ||||||
23,573 | Rollins, Inc. | 709,076 | ||||||
9,817 | RPX Corp.(b) | 160,802 | ||||||
7,481 | Rush Enterprises, Inc., Class B(b) | 211,563 | ||||||
37,733 | Rush Enterprises, Inc., Class A(b) | 1,211,229 | ||||||
46,332 | Safe Bulkers, Inc. (Greece)(c) | 376,216 | ||||||
22,133 | Saia, Inc.(b) | 911,216 | ||||||
61,914 | Seaspan Corp., Class A (Hong Kong)(c) | 1,334,866 | ||||||
21,154 | Simpson Manufacturing Co., Inc. | 693,640 | ||||||
20,168 | SP Plus Corp.(b) | 492,503 | ||||||
4,905 | Sparton Corp.(b) | 133,220 | ||||||
4,921 | Spirit Airlines, Inc.(b) | 279,710 | ||||||
8,758 | Standex International Corp. | 519,962 | ||||||
41,698 | Star Bulk Carriers Corp. (Greece)(b)(c) | 495,372 | ||||||
22,117 | Sterling Construction Co., Inc.(b) | 169,859 | ||||||
6,075 | Sun Hydraulics Corp. | 248,346 | ||||||
55,989 | Swift Transportation Co.(b) | 1,346,535 | ||||||
33,872 | TAL International Group, Inc. | 1,428,721 | ||||||
12,911 | Team, Inc.(b) | 553,753 | ||||||
30,625 | Tecumseh Products Co., Class A(b) | 184,056 | ||||||
8,865 | Tecumseh Products Co., Class B(b) | 51,772 | ||||||
9,326 | Tennant Co. | 594,906 | ||||||
60,042 | Tetra Tech, Inc.(b) | 1,721,404 | ||||||
16,854 | Textainer Group Holdings Ltd.(c) | 662,362 | ||||||
11,715 | Thermon Group Holdings, Inc.(b) | 279,051 | ||||||
46,690 | Titan International, Inc. | 817,542 | ||||||
48,273 | Titan Machinery, Inc.(b) | 851,536 | ||||||
21,667 | Toro Co. (The) | 1,376,721 | ||||||
3,727 | Trex Co., Inc.(b) | 292,644 | ||||||
28,472 | Trimas Corp.(b) | 1,021,006 | ||||||
34,360 | TrueBlue, Inc.(b) | 919,130 | ||||||
9,312 | Twin Disc, Inc. | 269,396 | ||||||
8,525 | UniFirst Corp. | 820,446 | ||||||
20,453 | Universal Forest Products, Inc. | 1,032,672 | ||||||
9,331 | US Ecology, Inc. | 416,629 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 37 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
17,163 | USA Truck, Inc.(b) | $ | 285,936 | |||||
28,298 | USG Corp.(b) | 844,978 | ||||||
26,172 | Verisk Analytics, Inc., Class A(b) | 1,572,675 | ||||||
27,037 | Viad Corp. | 623,203 | ||||||
5,790 | VSE Corp. | 361,701 | ||||||
34,218 | Wabash National Corp.(b) | 457,152 | ||||||
18,305 | Wabtec Corp. | 1,364,638 | ||||||
2,888 | WageWorks, Inc.(b) | 122,365 | ||||||
15,969 | Watts Water Technologies, Inc., Class A | 849,551 | ||||||
31,089 | Wesco Aircraft Holdings, Inc.(b) | 629,863 | ||||||
27,733 | West Corp. | 675,299 | ||||||
38,013 | Woodward, Inc. | 1,704,123 | ||||||
14,287 | Xerium Technologies, Inc.(b) | 192,874 | ||||||
|
| |||||||
160,670,872 | ||||||||
|
| |||||||
Information Technology—16.2% | ||||||||
5,757 | 3D Systems Corp.(b)(c) | 272,536 | ||||||
13,247 | ACI Worldwide, Inc.(b) | 757,066 | ||||||
31,266 | Actuate Corp.(b) | 176,028 | ||||||
28,233 | Acxiom Corp.(b) | 797,300 | ||||||
34,321 | ADTRAN, Inc. | 769,820 | ||||||
16,604 | Advanced Energy Industries, Inc.(b) | 363,296 | ||||||
13,926 | Advent Software, Inc. | 401,347 | ||||||
21,095 | Aeroflex Holding Corp.(b) | 161,377 | ||||||
14,233 | Agilysys, Inc.(b) | 178,482 | ||||||
23,627 | Alpha & Omega Semiconductor Ltd.(b) | 170,114 | ||||||
17,624 | American Software, Inc., Class A | 169,895 | ||||||
43,097 | ARRIS Group, Inc.(b) | 1,124,401 | ||||||
17,531 | Aruba Networks, Inc.(b) | 346,588 | ||||||
3,762 | Aspen Technology, Inc.(b) | 161,728 | ||||||
209,826 | Atmel Corp.(b) | 1,630,348 | ||||||
8,778 | AVG Technologies NV(b) | 164,412 | ||||||
136,088 | Aviat Networks, Inc.(b) | 205,493 | ||||||
57,801 | AVX Corp. (Japan) | 771,643 | ||||||
97,227 | Axcelis Technologies, Inc.(b) | 174,036 | ||||||
6,474 | Badger Meter, Inc. | 320,787 | ||||||
17,471 | Bankrate, Inc. (United Kingdom)(b) | 306,092 | ||||||
2,752 | Bel Fuse, Inc., Class A | 56,031 | ||||||
11,446 | Bel Fuse, Inc., Class B | 249,065 | ||||||
20,202 | Belden, Inc. | 1,491,110 | ||||||
25,193 | Black Box Corp. | 535,603 | ||||||
16,873 | Blackbaud, Inc. | 513,783 | ||||||
22,116 | Blucora, Inc.(b) | 425,733 | ||||||
8,351 | Bottomline Technologies, Inc.(b) | 264,226 | ||||||
5,131 | BroadSoft, Inc.(b) | 130,225 | ||||||
54,021 | Brooks Automation, Inc. | 552,635 | ||||||
29,950 | Cabot Microelectronics Corp.(b) | 1,298,931 | ||||||
88,820 | Cadence Design Systems, Inc.(b) | 1,382,039 | ||||||
30,496 | Calix, Inc.(b) | 268,670 | ||||||
12,787 | Canadian Solar, Inc. (Canada)(b)(c) | 346,783 | ||||||
14,119 | Cardtronics, Inc.(b) | 472,704 | ||||||
3,717 | Cass Information Systems, Inc. | 187,746 | ||||||
6,270 | Cavium, Inc.(b) | 265,660 | ||||||
68,758 | CDW Corp. | 1,938,288 | ||||||
9,651 | CEVA, Inc.(b) | 156,636 | ||||||
54,338 | Checkpoint Systems, Inc.(b) | 693,896 | ||||||
18,548 | ChipMOS TECHNOLOGIES Bermuda Ltd. (Taiwan) | 390,250 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
108,438 | CIBER, Inc.(b) | $ | 468,452 | |||||
21,645 | Ciena Corp.(b) | 427,922 | ||||||
41,290 | Cirrus Logic, Inc.(b) | 920,767 | ||||||
18,978 | Cognex Corp.(b) | 653,413 | ||||||
13,807 | Coherent, Inc.(b) | 824,416 | ||||||
30,110 | Cohu, Inc. | 310,133 | ||||||
29,842 | CommScope Holding Co., Inc.(b) | 796,185 | ||||||
6,810 | CommVault Systems, Inc.(b) | 329,604 | ||||||
11,727 | Computer Task Group, Inc. | 185,404 | ||||||
133,926 | Compuware Corp. | 1,387,473 | ||||||
7,239 | comScore, Inc.(b) | 226,798 | ||||||
23,740 | Comtech Telecommunications Corp. | 753,745 | ||||||
9,650 | Comverse, Inc.(b) | 240,671 | ||||||
4,412 | Concur Technologies, Inc.(b) | 355,034 | ||||||
8,797 | Constant Contact, Inc.(b) | 227,490 | ||||||
36,021 | Conversant, Inc.(b) | 880,353 | ||||||
3,259 | CoStar Group, Inc.(b) | 524,341 | ||||||
10,996 | Cray, Inc.(b) | 315,695 | ||||||
28,802 | CSG Systems International, Inc. | 759,221 | ||||||
21,867 | CTS Corp. | 389,014 | ||||||
70,596 | Cypress Semiconductor Corp. | 668,544 | ||||||
38,847 | Daktronics, Inc. | 505,788 | ||||||
13,778 | Datalink Corp.(b) | 176,910 | ||||||
11,531 | Dealertrack Technologies, Inc.(b) | 526,851 | ||||||
27,945 | Demand Media, Inc.(b) | 116,251 | ||||||
35,471 | Dice Holdings, Inc.(b) | 271,353 | ||||||
30,874 | Digi International, Inc.(b) | 273,544 | ||||||
29,569 | Digital River, Inc.(b) | 452,110 | ||||||
27,752 | Diodes, Inc.(b) | 731,820 | ||||||
28,973 | Dolby Laboratories, Inc., Class A(b)(c) | 1,154,574 | ||||||
28,764 | DSP Group, Inc.(b) | 228,961 | ||||||
10,415 | DTS, Inc.(b) | 193,823 | ||||||
324,125 | EarthLink Holdings Corp. | 1,105,266 | ||||||
24,724 | Eastman Kodak Co.(b)(c) | 738,506 | ||||||
18,623 | Ebix, Inc.(c) | 293,871 | ||||||
18,093 | Electro Rent Corp. | 292,202 | ||||||
39,335 | Electro Scientific Industries, Inc. | 333,561 | ||||||
17,106 | Electronics for Imaging, Inc.(b) | 646,436 | ||||||
94,510 | Emulex Corp.(b) | 675,746 | ||||||
66,598 | Entegris, Inc.(b) | 738,572 | ||||||
75,194 | Entropic Communications, Inc.(b) | 277,466 | ||||||
4,128 | EPAM Systems, Inc.(b) | 128,505 | ||||||
25,645 | EPIQ Systems, Inc. | 328,000 | ||||||
5,690 | ePlus, Inc.(b) | 284,728 | ||||||
32,092 | Euronet Worldwide, Inc.(b) | 1,475,911 | ||||||
16,244 | EVERTEC, Inc. | 382,384 | ||||||
15,287 | Exar Corp.(b) | 165,405 | ||||||
13,015 | ExlService Holdings, Inc.(b) | 368,259 | ||||||
41,334 | Extreme Networks, Inc.(b) | 236,430 | ||||||
20,451 | Fabrinet (Cayman Islands)(b) | 441,742 | ||||||
13,633 | FactSet Research Systems, Inc.(c) | 1,451,914 | ||||||
13,541 | Fair Isaac Corp. | 774,545 | ||||||
6,041 | FARO Technologies, Inc.(b) | 241,036 | ||||||
8,592 | FEI Co. | 683,236 | ||||||
41,319 | Finisar Corp.(b) | 1,080,492 | ||||||
9,575 | FleetCor Technologies, Inc.(b) | 1,092,795 | ||||||
38,345 | FormFactor, Inc.(b) | 220,484 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 38 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
8,746 | Forrester Research, Inc. | $ | 309,871 | |||||
22,782 | Fortinet, Inc.(b) | 500,748 | ||||||
34,840 | Freescale Semiconductor Ltd.(b) | 765,435 | ||||||
26,959 | Fusion-io, Inc.(b) | 232,656 | ||||||
17,447 | Gartner, Inc.(b) | 1,202,796 | ||||||
36,851 | Global Cash Access Holdings, Inc.(b) | 243,217 | ||||||
24,616 | GSI Group, Inc.(b) | 298,838 | ||||||
57,535 | GT Advanced Technologies, Inc.(b)(c) | 955,656 | ||||||
2,990 | Guidewire Software, Inc.(b) | 112,902 | ||||||
30,873 | Hackett Group, Inc. (The) | 185,238 | ||||||
98,912 | Harmonic, Inc.(b) | 695,351 | ||||||
25,404 | Heartland Payment Systems, Inc. | 1,040,040 | ||||||
12,695 | Hittite Microwave Corp. | 753,575 | ||||||
12,537 | Hollysys Automation Technologies Ltd. (China)(b) | 268,417 | ||||||
75,654 | Hutchinson Technology, Inc.(b) | 210,318 | ||||||
22,848 | IAC/InterActiveCorp. | 1,514,365 | ||||||
6,627 | iGATE Corp.(b) | 242,548 | ||||||
47,483 | II-VI, Inc.(b) | 683,755 | ||||||
40,406 | Imation Corp.(b) | 174,554 | ||||||
44,571 | Infinera Corp.(b) | 399,356 | ||||||
29,805 | Informatica Corp.(b) | 1,056,587 | ||||||
63,451 | Integrated Device Technology, Inc.(b) | 740,473 | ||||||
26,183 | Integrated Silicon Solution, Inc.(b) | 378,606 | ||||||
1,915 | Interactive Intelligence Group, Inc.(b) | 119,822 | ||||||
31,473 | InterDigital, Inc. | 1,092,743 | ||||||
40,731 | Internap Network Services Corp.(b) | 273,712 | ||||||
53,428 | International Rectifier Corp.(b) | 1,391,265 | ||||||
117,727 | Intersil Corp., Class A | 1,452,751 | ||||||
13,030 | InterXion Holding NV (Netherlands)(b) | 336,826 | ||||||
21,150 | IntraLinks Holdings, Inc.(b) | 193,523 | ||||||
7,745 | InvenSense, Inc.(b)(c) | 166,750 | ||||||
7,088 | IPG Photonics Corp.(b)(c) | 458,097 | ||||||
31,494 | Ixia(b) | 391,155 | ||||||
16,498 | IXYS Corp. | 178,013 | ||||||
15,371 | j2 Global, Inc. | 712,600 | ||||||
22,360 | Jack Henry & Associates, Inc. | 1,233,378 | ||||||
115,641 | JDS Uniphase Corp.(b) | 1,465,171 | ||||||
80,096 | Kemet Corp.(b) | 401,281 | ||||||
15,243 | Key Tronic Corp.(b) | 159,747 | ||||||
77,218 | Kulicke & Soffa Industries, Inc. (Singapore)(b) | 1,135,877 | ||||||
52,670 | Lattice Semiconductor Corp.(b) | 443,481 | ||||||
3,783 | LinkedIn Corp., Class A(b) | 580,577 | ||||||
39,146 | Lionbridge Technologies, Inc.(b) | 230,178 | ||||||
12,351 | Liquidity Services, Inc.(b)(c) | 213,055 | ||||||
7,818 | Littelfuse, Inc. | 707,920 | ||||||
11,934 | LivePerson, Inc.(b) | 118,147 | ||||||
3,988 | LogMeIn, Inc.(b) | 181,255 | ||||||
26,830 | LTX-Credence Corp.(b) | 258,373 | ||||||
47,022 | Magnachip Semiconductor Corp. (South Korea)(b) | 658,308 | ||||||
10,826 | Manhattan Associates, Inc.(b) | 341,344 | ||||||
44,093 | ManTech International Corp., Class A | 1,315,294 | ||||||
15,447 | MAXIMUS, Inc. | 657,579 | ||||||
6,200 | Measurement Specialties, Inc.(b) | 398,970 | ||||||
15,096 | Mellanox Technologies Ltd. (Israel)(b)(c) | 527,907 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
64,147 | Mentor Graphics Corp. | $ | 1,327,843 | |||||
2,956 | MercadoLibre, Inc. (Argentina)(c) | 275,706 | ||||||
33,319 | Mercury Systems, Inc.(b) | 465,133 | ||||||
14,478 | Methode Electronics, Inc. | 401,620 | ||||||
31,049 | Micrel, Inc. | 309,248 | ||||||
30,743 | MICROS Systems, Inc.(b) | 1,583,265 | ||||||
52,572 | Microsemi Corp.(b) | 1,236,493 | ||||||
3,034 | MicroStrategy, Inc., Class A(b) | 368,419 | ||||||
33,073 | MKS Instruments, Inc. | 931,005 | ||||||
98,847 | ModusLink Global Solutions, Inc.(b)(c) | 399,342 | ||||||
14,851 | MoneyGram International, Inc.(b) | 196,033 | ||||||
8,497 | Monolithic Power Systems, Inc.(b) | 315,239 | ||||||
138,381 | Monster Worldwide, Inc.(b) | 953,445 | ||||||
14,210 | Move, Inc.(b) | 151,905 | ||||||
6,796 | MTS Systems Corp. | 438,138 | ||||||
13,700 | Multi-Fineline Electronix, Inc. (Singapore)(b) | 169,606 | ||||||
84,421 | Nam Tai Property, Inc. (China)(c) | 583,349 | ||||||
10,131 | Nanometrics, Inc.(b) | 164,730 | ||||||
43,239 | National Instruments Corp. | 1,180,857 | ||||||
50,683 | Net 1 UEPS Technologies, Inc. (South Africa)(b) | 453,613 | ||||||
33,913 | NETGEAR, Inc.(b) | 1,095,390 | ||||||
14,670 | Netscout Systems, Inc.(b) | 571,543 | ||||||
39,116 | NeuStar, Inc., Class A(b) | 1,006,064 | ||||||
26,788 | Newport Corp.(b) | 500,400 | ||||||
20,182 | NIC, Inc. | 370,138 | ||||||
79,511 | Novatel Wireless, Inc.(b) | 143,915 | ||||||
79,208 | Oclaro, Inc.(b) | 269,307 | ||||||
64,236 | OmniVision Technologies, Inc.(b) | 1,254,529 | ||||||
2,901 | OpenTable, Inc.(b) | 194,831 | ||||||
16,822 | Oplink Communications, Inc.(b) | 288,329 | ||||||
40,576 | Orbotech Ltd. (Israel)(b) | 598,090 | ||||||
10,499 | OSI Systems, Inc.(b) | 585,949 | ||||||
20,384 | Park Electrochemical Corp. | 543,437 | ||||||
13,459 | PC Connection, Inc. | 269,315 | ||||||
6,946 | Pegasystems, Inc. | 115,095 | ||||||
15,557 | Perficient, Inc.(b) | 284,226 | ||||||
26,568 | Pericom Semiconductor Corp.(b) | 214,404 | ||||||
90,302 | Photronics, Inc.(b) | 783,821 | ||||||
19,952 | Plantronics, Inc. | 869,309 | ||||||
37,811 | Plexus Corp.(b) | 1,585,037 | ||||||
129,011 | PMC - Sierra, Inc.(b) | 882,435 | ||||||
6,261 | Power Integrations, Inc. | 295,707 | ||||||
27,181 | PRGX Global, Inc.(b) | 174,774 | ||||||
36,960 | Progress Software Corp.(b) | 793,162 | ||||||
37,038 | PTC, Inc.(b) | 1,310,034 | ||||||
8,888 | QLIK Technologies, Inc.(b) | 195,358 | ||||||
100,837 | QLogic Corp.(b) | 1,167,692 | ||||||
379,731 | Quantum Corp.(b) | 410,109 | ||||||
45,986 | QuinStreet, Inc.(b) | 280,515 | ||||||
36,097 | Rackspace Hosting, Inc.(b) | 1,047,535 | ||||||
68,417 | RadiSys Corp.(b) | 218,934 | ||||||
15,145 | RADWARE Ltd. (Israel)(b) | 250,347 | ||||||
28,002 | Rambus, Inc.(b) | 338,544 | ||||||
15,955 | RealD, Inc.(b)(c) | 174,867 | ||||||
32,680 | RealNetworks, Inc.(b) | 246,407 | ||||||
9,522 | RealPage, Inc.(b) | 169,016 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 39 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
149,724 | RF Micro Devices, Inc.(b) | $ | 1,263,671 | |||||
46,157 | Riverbed Technology, Inc.(b) | 897,754 | ||||||
30,846 | Rofin-Sinar Technologies, Inc.(b) | 684,781 | ||||||
9,314 | Rogers Corp.(b) | 559,026 | ||||||
13,789 | Rosetta Stone, Inc.(b) | 164,227 | ||||||
13,791 | Rubicon Technology, Inc.(b) | 139,703 | ||||||
22,868 | Rudolph Technologies, Inc.(b) | 208,327 | ||||||
44,351 | Sapient Corp.(b) | 721,591 | ||||||
44,654 | ScanSource, Inc.(b) | 1,715,160 | ||||||
20,890 | SeaChange International, Inc.(b) | 195,739 | ||||||
30,172 | Semtech Corp.(b) | 723,525 | ||||||
19,186 | ShoreTel, Inc.(b) | 144,854 | ||||||
40,689 | Sigma Designs, Inc.(b) | 153,398 | ||||||
20,858 | Silicon Graphics International Corp.(b) | 251,965 | ||||||
30,483 | Silicon Image, Inc.(b) | 171,010 | ||||||
15,817 | Silicon Laboratories, Inc.(b) | 710,974 | ||||||
14,416 | SINA Corp. (China)(b) | 689,085 | ||||||
17,745 | Sohu.com, Inc. (China)(b) | 978,992 | ||||||
10,023 | SolarWinds, Inc.(b) | 404,127 | ||||||
17,247 | Solera Holdings, Inc. | 1,117,261 | ||||||
69,554 | Sonus Networks, Inc.(b) | 227,442 | ||||||
73,322 | Spansion, Inc., Class A(b) | 1,307,331 | ||||||
51,073 | Speed Commerce, Inc.(b) | 168,541 | ||||||
25,386 | SS&C Technologies Holdings, Inc.(b) | 988,023 | ||||||
138,333 | STR Holdings, Inc.(b) | 218,566 | ||||||
7,700 | Stratasys Ltd.(b)(c) | 745,899 | ||||||
18,023 | SunPower Corp. (France)(b)(c) | 602,329 | ||||||
23,623 | Super Micro Computer, Inc.(b) | 480,964 | ||||||
48,985 | Sykes Enterprises, Inc.(b) | 969,413 | ||||||
9,822 | Synaptics, Inc.(b) | 610,437 | ||||||
9,476 | Synchronoss Technologies, Inc.(b) | 288,449 | ||||||
5,259 | Syntel, Inc.(b) | 422,403 | ||||||
65,101 | Take-Two Interactive Software, Inc.(b) | 1,326,758 | ||||||
98,722 | TeleCommunication Systems, Inc., Class A(b) | 251,741 | ||||||
21,166 | TeleTech Holdings, Inc.(b) | 510,736 | ||||||
6,392 | Tessco Technologies, Inc. | 210,233 | ||||||
34,020 | Tessera Technologies, Inc. | 746,059 | ||||||
64,379 | TIBCO Software, Inc.(b) | 1,263,760 | ||||||
21,024 | TiVo, Inc.(b) | 249,345 | ||||||
91,819 | TriQuint Semiconductor, Inc.(b) | 1,301,993 | ||||||
103,523 | TTM Technologies, Inc.(b) | 816,796 | ||||||
3,633 | Tyler Technologies, Inc.(b) | 296,634 | ||||||
1,374 | Ultimate Software Group, Inc. (The)(b) | 164,372 | ||||||
14,869 | Ultra Clean Holdings, Inc.(b) | 126,684 | ||||||
14,995 | Ultratech, Inc.(b) | 399,167 | ||||||
113,788 | United Online, Inc. | 1,348,388 | ||||||
6,335 | Universal Display Corp.(b)(c) | 165,027 | ||||||
40,441 | Vantiv, Inc., Class A(b) | 1,243,561 | ||||||
28,922 | Veeco Instruments, Inc.(b) | 1,069,246 | ||||||
15,495 | Verint Systems, Inc.(b) | 678,216 | ||||||
24,645 | Verisign, Inc.(b) | 1,162,751 | ||||||
18,658 | ViaSat, Inc.(b) | 1,198,030 | ||||||
8,055 | Virtusa Corp.(b) | 265,573 | ||||||
16,454 | Vishay Precision Group, Inc.(b) | 267,048 | ||||||
13,074 | Vistaprint NV(b)(c) | 516,031 | ||||||
12,429 | VMware, Inc., Class A(b) | 1,149,807 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
13,753 | WebMD Health Corp.(b)(c) | $ | 606,370 | |||||
13,647 | WEX, Inc.(b) | 1,309,703 | ||||||
1,805 | Workday, Inc., Class A(b) | 131,891 | ||||||
12,291 | XO Group, Inc.(b) | 130,530 | ||||||
32,922 | Yandex NV, Class A (Russia)(b) | 872,433 | ||||||
21,519 | Zebra Technologies Corp., Class A(b) | 1,494,279 | ||||||
13,151 | Zygo Corp.(b) | 253,025 | ||||||
221,794 | Zynga, Inc., Class A(b) | 898,266 | ||||||
|
| |||||||
155,290,330 | ||||||||
|
| |||||||
Materials—6.1% | ||||||||
37,536 | A. Schulman, Inc. | 1,348,293 | ||||||
25,412 | A.M. Castle & Co.(b) | 312,059 | ||||||
9,879 | AEP Industries, Inc.(b) | 351,890 | ||||||
82,895 | Allied Nevada Gold Corp.(b)(c) | 281,014 | ||||||
16,814 | AMCOL International Corp. | 770,922 | ||||||
8,764 | American Vanguard Corp. | 156,087 | ||||||
14,826 | Ampco-Pittsburgh Corp. | 296,965 | ||||||
42,258 | Axiall Corp. | 1,969,223 | ||||||
7,647 | Balchem Corp. | 473,732 | ||||||
41,193 | Boise Cascade Co.(b) | 1,030,649 | ||||||
2,994 | Caesarstone Sdot-Yam Ltd. (Israel) | 156,227 | ||||||
31,415 | Calgon Carbon Corp.(b) | 629,242 | ||||||
27,645 | Carpenter Technology Corp. | 1,736,106 | ||||||
85,070 | Century Aluminum Co.(b) | 1,169,713 | ||||||
66,723 | China Green Agriculture, Inc. (China)(b)(c) | 184,155 | ||||||
21,539 | Clearwater Paper Corp.(b) | 1,322,279 | ||||||
36,427 | Constellium NV, Class A (Netherlands)(b) | 1,111,752 | ||||||
3,246 | Deltic Timber Corp. | 197,195 | ||||||
10,710 | Eagle Materials, Inc. | 892,464 | ||||||
83,047 | Ferro Corp.(b) | 1,077,950 | ||||||
9,514 | Flotek Industries, Inc.(b) | 266,487 | ||||||
15,469 | FutureFuel Corp. | 310,463 | ||||||
28,742 | Globe Specialty Metals, Inc. | 557,020 | ||||||
27,742 | Gold Resource Corp.(c) | 127,891 | ||||||
160,231 | Golden Minerals Co.(b)(c) | 112,162 | ||||||
83,554 | Gulf Resources, Inc. (China)(b)(c) | 153,739 | ||||||
28,163 | H.B. Fuller Co. | 1,304,792 | ||||||
9,514 | Handy & Harman Ltd.(b) | 215,112 | ||||||
9,932 | Hawkins, Inc. | 359,538 | ||||||
9,933 | Haynes International, Inc. | 526,946 | ||||||
38,745 | Headwaters, Inc.(b) | 483,538 | ||||||
271,995 | Hecla Mining Co.(c) | 835,025 | ||||||
27,321 | Horsehead Holding Corp.(b) | 425,934 | ||||||
21,136 | Innophos Holdings, Inc. | 1,192,916 | ||||||
12,663 | Innospec, Inc. | 545,269 | ||||||
58,003 | Intrepid Potash, Inc.(b)(c) | 945,449 | ||||||
19,466 | Kaiser Aluminum Corp. | 1,370,406 | ||||||
27,834 | KapStone Paper and Packaging Corp.(b) | 734,261 | ||||||
23,585 | Koppers Holdings, Inc. | 1,007,080 | ||||||
45,375 | Kraton Performance Polymers, Inc.(b) | 1,182,019 | ||||||
30,576 | Kronos Worldwide, Inc. | 478,514 | ||||||
28,885 | Landec Corp.(b) | 342,576 | ||||||
51,382 | Louisiana-Pacific Corp.(b) | 842,151 | ||||||
16,249 | LSB Industries, Inc.(b) | 620,549 | ||||||
26,026 | Materion Corp. | 875,775 | ||||||
147,945 | McEwen Mining, Inc.(b)(c) | 355,068 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 40 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Materials (continued) | ||||||||
22,633 | Mercer International, Inc.(b) | $ | 187,401 | |||||
20,702 | Minerals Technologies, Inc. | 1,231,562 | ||||||
120,307 | Molycorp, Inc.(b)(c) | 571,458 | ||||||
23,183 | Myers Industries, Inc. | 433,522 | ||||||
12,182 | Neenah Paper, Inc. | 613,607 | ||||||
139,651 | Noranda Aluminum Holding Corp. | 495,761 | ||||||
20,768 | Olympic Steel, Inc. | 547,444 | ||||||
53,167 | OM Group, Inc. | 1,557,261 | ||||||
57,764 | Omnova Solutions, Inc.(b) | 526,808 | ||||||
41,903 | P.H. Glatfelter Co. | 1,069,365 | ||||||
12,104 | Penford Corp.(b) | 152,510 | ||||||
42,811 | PolyOne Corp. | 1,604,128 | ||||||
8,141 | Quaker Chemical Corp. | 605,935 | ||||||
18,138 | Royal Gold, Inc. | 1,200,736 | ||||||
29,367 | RTI International Metals, Inc.(b) | 826,975 | ||||||
19,430 | Schweitzer-Mauduit International, Inc. | 847,925 | ||||||
26,801 | Scotts Miracle-Gro Co. (The), Class A | 1,640,489 | ||||||
15,508 | Stepan Co. | 896,828 | ||||||
100,222 | Stillwater Mining Co.(b) | 1,581,503 | ||||||
65,667 | SunCoke Energy, Inc.(b) | 1,370,470 | ||||||
12,862 | Taminco Corp.(b) | 258,398 | ||||||
8,883 | Texas Industries, Inc.(b)(c) | 770,156 | ||||||
20,372 | Tredegar Corp. | 423,941 | ||||||
55,806 | Tronox Ltd., Class A | 1,367,247 | ||||||
7,741 | Universal Stainless & Alloy Products, Inc.(b) | 277,825 | ||||||
7,384 | US Concrete, Inc.(b) | 181,794 | ||||||
18,756 | US Silica Holdings, Inc. | 847,209 | ||||||
140,968 | Verso Paper Corp.(b)(c) | 383,433 | ||||||
42,492 | Wausau Paper Corp. | 508,204 | ||||||
16,826 | Westlake Chemical Corp. | 1,198,011 | ||||||
39,868 | Worthington Industries, Inc. | 1,467,142 | ||||||
65,153 | Yongye International, Inc. (China)(b)(c) | 455,419 | ||||||
23,404 | Zep, Inc. | 404,655 | ||||||
|
| |||||||
58,143,719 | ||||||||
|
| |||||||
Telecommunication Services—1.3% | ||||||||
224,764 | Alaska Communications Systems Group, Inc.(b) | 424,804 | ||||||
8,088 | Atlantic Tele-Network, Inc. | 478,567 | ||||||
64,153 | Cbeyond, Inc.(b) | 634,473 | ||||||
8,370 | Cogent Communications Group, Inc. | 288,514 | ||||||
58,361 | Consolidated Communications Holdings, Inc. | 1,162,551 | ||||||
58,618 | FairPoint Communications, Inc.(b) | 799,550 | ||||||
62,726 | General Communication, Inc., Class A(b) | 654,859 | ||||||
9,002 | Hawaiian Telcom Holdco, Inc.(b) | 239,633 | ||||||
17,003 | HickoryTech Corp. | 201,826 | ||||||
23,708 | IDT Corp., Class B | 375,535 | ||||||
36,832 | Inteliquent, Inc. | 502,389 | ||||||
42,138 | Intelsat SA (United Kingdom)(b)(c) | 766,069 | ||||||
83,811 | Iridium Communications, Inc.(b)(c) | 559,019 | ||||||
16,590 | Lumos Networks Corp. | 219,154 | ||||||
52,308 | NTELOS Holdings Corp.(c) | 721,327 | ||||||
48,579 | Premiere Global Services, Inc.(b) | 617,925 | ||||||
15,978 | SBA Communications Corp., Class A(b) | 1,434,185 | ||||||
16,545 | Shenandoah Telecommunications Co. | 463,756 | ||||||
29,035 | United States Cellular Corp. | 1,206,114 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Telecommunication (continued) | ||||||||
45,414 | USA Mobility, Inc. | $ | 777,942 | |||||
114,768 | Vonage Holdings Corp.(b) | 440,709 | ||||||
|
| |||||||
12,968,901 | ||||||||
|
| |||||||
Utilities—1.6% | ||||||||
28,978 | American States Water Co. | 879,772 | ||||||
6,699 | Artesian Resources Corp., Class A | 147,512 | ||||||
40,467 | California Water Service Group | 910,508 | ||||||
8,694 | Chesapeake Utilities Corp. | 549,982 | ||||||
7,874 | Connecticut Water Service, Inc. | 255,905 | ||||||
13,140 | Consolidated Water Co. Ltd. (Cayman Islands) | 152,687 | ||||||
39,183 | El Paso Electric Co. | 1,481,901 | ||||||
59,963 | Empire District Electric Co. (The) | 1,458,300 | ||||||
14,785 | Genie Energy Ltd., Class B(b) | 119,759 | ||||||
33,545 | Laclede Group, Inc. (The) | 1,590,368 | ||||||
30,036 | MGE Energy, Inc. | 1,147,976 | ||||||
15,870 | Middlesex Water Co. | 322,637 | ||||||
39,558 | Northwest Natural Gas Co. | 1,751,233 | ||||||
6,344 | NRG Yield, Inc., Class A(c) | 271,777 | ||||||
13,025 | Ormat Technologies, Inc. (Israel) | 347,507 | ||||||
38,192 | Otter Tail Corp. | 1,119,026 | ||||||
6,192 | Pattern Energy Group, Inc. | 165,946 | ||||||
13,358 | SJW Corp. | 363,738 | ||||||
27,225 | South Jersey Industries, Inc. | 1,564,076 | ||||||
17,005 | Unitil Corp. | 564,566 | ||||||
8,741 | York Water Co. (The) | 174,907 | ||||||
|
| |||||||
15,340,083 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $840,287,904) | 958,375,897 | |||||||
|
| |||||||
Warrant—0.0% | ||||||||
Energy—0.0% | ||||||||
4,742 | Magnum Hunter Corp., expiring 05/15/16(b) (Cost $0) | 0 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $840,287,904)—100.0% | 958,375,897 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—6.2% | ||||||||
59,546,191 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $59,546,191) | 59,546,191 | ||||||
|
| |||||||
Total Investments (Cost $899,834,095)—106.2% | 1,017,922,088 | |||||||
Other assets less liabilities—(6.2)% | (59,191,093 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 958,730,995 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 41 |
|
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) (continued)
April 30, 2014
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 57,862,237 | $ | (57,862,237 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 42 |
|
Statements of Assets and Liabilities
April 30, 2014
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) | PowerShares Dynamic Market Portfolio (PWC) | PowerShares FTSE RAFI US 1000 Portfolio (PRF) | PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) | |||||||||||||
Assets: | ||||||||||||||||
Unaffiliated investments, at value(a) | $ | 25,740,510 | $ | 186,253,482 | $ | 3,302,329,715 | $ | 958,375,897 | ||||||||
Affiliated investments, at value | 47,779 | 16,067 | 30,762,512 | 59,546,191 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at value | 25,788,289 | 186,269,549 | 3,333,092,227 | 1,017,922,088 | ||||||||||||
Foreign currencies, at value | — | — | — | 26,494 | ||||||||||||
Receivables: | ||||||||||||||||
Dividends | 2,327 | 114,307 | 3,375,762 | 411,782 | ||||||||||||
Expenses absorbed | 193 | — | — | — | ||||||||||||
Foreign tax reclaims | 185 | — | 2,407 | 541 | ||||||||||||
Investments sold | — | — | 1,639,231 | 2,181,112 | ||||||||||||
Security lending | — | — | 68,907 | 168,823 | ||||||||||||
Shares sold | — | 3,478,616 | 25,612,184 | — | ||||||||||||
Other assets | 3,333 | 3,330 | 5,830 | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Assets | 25,794,327 | 189,865,802 | 3,363,796,548 | 1,020,710,840 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Liabilities: | ||||||||||||||||
Due to custodian | — | — | 333,087 | 440,602 | ||||||||||||
Payables: | ||||||||||||||||
Investments purchased | — | 3,474,471 | 27,222,692 | 1,145,959 | ||||||||||||
Collateral upon return of securities loaned | — | — | 27,882,011 | 59,546,191 | ||||||||||||
Accrued advisory fees | — | 77,758 | 618,741 | 174,136 | ||||||||||||
Accrued trustees’ and officer’s fees | 12,720 | 25,435 | 75,298 | 29,419 | ||||||||||||
Accrued expenses | 47,279 | 69,327 | 1,968,263 | 643,538 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Liabilities | 59,999 | 3,646,991 | 58,100,092 | 61,979,845 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 25,734,328 | $ | 186,218,811 | $ | 3,305,696,456 | $ | 958,730,995 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets Consist of: | ||||||||||||||||
Shares of beneficial interest | $ | 102,464,420 | $ | 537,115,941 | $ | 2,863,581,397 | $ | 872,874,463 | ||||||||
Undistributed net investment income (loss) | (13,051 | ) | 233,919 | 7,365,319 | 1,928,173 | |||||||||||
Undistributed net realized gain (loss) | (74,491,163 | ) | (357,422,241 | ) | (184,274,079 | ) | (34,160,572 | ) | ||||||||
Net unrealized appreciation (depreciation) | (2,225,878 | ) | 6,291,192 | 619,023,819 | 118,088,931 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 25,734,328 | $ | 186,218,811 | $ | 3,305,696,456 | $ | 958,730,995 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 400,000 | 2,650,000 | 38,700,000 | 9,950,000 | ||||||||||||
Net asset value | $ | 64.34 | $ | 70.27 | $ | 85.42 | $ | 96.35 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Market price | $ | 64.32 | $ | 70.27 | $ | 85.37 | $ | 96.38 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Unaffiliated investments, at cost | $ | 27,966,388 | $ | 179,962,290 | $ | 2,683,630,655 | $ | 840,287,904 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Affiliated investments, at cost | $ | 47,779 | $ | 16,067 | $ | 30,437,753 | $ | 59,546,191 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at cost | $ | 28,014,167 | $ | 179,978,357 | $ | 2,714,068,408 | $ | 899,834,095 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Foreign currencies, at cost | $ | — | $ | — | $ | — | $ | 25,556 | ||||||||
|
|
|
|
|
|
|
| |||||||||
(a) Includes securities on loan with an aggregate value of | $ | — | $ | — | $ | 27,275,127 | $ | 57,862,237 | ||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 43 |
|
For the year ended April 30, 2014
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) | PowerShares Dynamic Market Portfolio (PWC) | PowerShares FTSE RAFI US 1000 Portfolio (PRF) | PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) | |||||||||||||
Investment Income: | ||||||||||||||||
Unaffiliated dividend income | $ | 233,272 | $ | 2,467,187 | $ | 55,176,054 | $ | 10,273,582 | ||||||||
Affiliated dividend income | 11 | 22 | 86,081 | 57 | ||||||||||||
Securities lending income | — | — | 424,253 | 1,372,349 | ||||||||||||
Foreign withholding tax | (447 | ) | (593 | ) | (2,520 | ) | (5,206 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Total Income | 232,836 | 2,466,616 | 55,683,868 | 11,640,782 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Expenses: | ||||||||||||||||
Advisory fees | 126,471 | 800,153 | 7,256,241 | 2,297,718 | ||||||||||||
Accounting & administration fees | 36,058 | 36,058 | 490,757 | 155,501 | ||||||||||||
Professional fees | 27,770 | 26,861 | 52,418 | 42,317 | ||||||||||||
Sub-licensing | 9,914 | 45,010 | 2,249,939 | 712,446 | ||||||||||||
Trustees’ and officer’s fees | 9,286 | 12,769 | 71,994 | 28,832 | ||||||||||||
Custodian & transfer agent fees | 5,423 | 17,468 | 32,589 | 28,558 | ||||||||||||
Other expenses | 16,512 | 28,182 | 229,262 | 98,825 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Expenses | 231,434 | 966,501 | 10,383,200 | 3,364,197 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Waivers | (79,738 | ) | (7,030 | ) | (638,184 | ) | (274,370 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Expenses | 151,696 | 959,471 | 9,745,016 | 3,089,827 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Investment Income | 81,140 | 1,507,145 | 45,938,852 | 8,550,955 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Realized and Unrealized Gain (Loss): | ||||||||||||||||
Net realized gain (loss) from: | ||||||||||||||||
Investment securities | 2,272,338 | 962,737 | (2,688,760 | ) | (8,222,562 | ) | ||||||||||
In-kind redemptions | 5,573,106 | 41,952,430 | 122,452,091 | 87,398,508 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized gain | 7,845,444 | 42,915,167 | 119,763,331 | 79,175,946 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Change in net unrealized appreciation (depreciation) on: | ||||||||||||||||
Investment securities | (5,108,462 | ) | (7,584,688 | ) | 316,724,319 | 69,308,580 | ||||||||||
Foreign currencies | — | — | — | 1,302 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net change in unrealized appreciation (depreciation) | (5,108,462 | ) | (7,584,688 | ) | 316,724,319 | 69,309,882 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized and unrealized gain | 2,736,982 | 35,330,479 | 436,487,650 | 148,485,828 | ||||||||||||
|
|
|
|
|
|
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| |||||||||
Net increase in net assets resulting from operations | $ | 2,818,122 | $ | 36,837,624 | $ | 482,426,502 | $ | 157,036,783 | ||||||||
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See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 44 |
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(This Page Intentionally Left Blank)
Statements of Changes in Net Assets
For the years ended April 30, 2014 and April 30, 2013
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) | PowerShares Dynamic Market Portfolio (PWC) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 81,140 | $ | 343,750 | $ | 1,507,145 | $ | 2,191,518 | ||||||||
Net realized gain | 7,845,444 | 1,181,833 | 42,915,167 | 19,915,303 | ||||||||||||
Net change in unrealized appreciation (depreciation) | (5,108,462 | ) | 302,308 | (7,584,688 | ) | 5,567,136 | ||||||||||
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Net increase in net assets resulting from operations | 2,818,122 | 1,827,891 | 36,837,624 | 27,673,957 | ||||||||||||
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Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (102,874 | ) | (376,429 | ) | (1,443,855 | ) | (2,277,011 | ) | ||||||||
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Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 38,073,218 | 22,456,458 | 310,118,300 | 188,278,816 | ||||||||||||
Value of shares repurchased | (37,214,086 | ) | (29,971,505 | ) | (299,950,822 | ) | (201,661,797 | ) | ||||||||
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| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | 859,132 | (7,515,047 | ) | 10,167,478 | (13,382,981 | ) | ||||||||||
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| |||||||||
Increase (Decrease) in Net Assets | 3,574,380 | (6,063,585 | ) | 45,561,247 | 12,013,965 | |||||||||||
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Net Assets: | ||||||||||||||||
Beginning of year | 22,159,948 | 28,223,533 | 140,657,564 | 128,643,599 | ||||||||||||
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End of year | $ | 25,734,328 | $ | 22,159,948 | $ | 186,218,811 | $ | 140,657,564 | ||||||||
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Undistributed net investment income (loss) at end of year | $ | (13,051 | ) | $ | 1,634 | $ | 233,919 | $ | 151,975 | |||||||
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Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 600,000 | 450,000 | 4,900,000 | 3,900,000 | ||||||||||||
Shares repurchased | (600,000 | ) | (600,000 | ) | (4,750,000 | ) | (4,150,000 | ) | ||||||||
Shares outstanding, beginning of year | 400,000 | 550,000 | 2,500,000 | 2,750,000 | ||||||||||||
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Shares outstanding, end of year | 400,000 | 400,000 | 2,650,000 | 2,500,000 | ||||||||||||
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See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 46 |
|
PowerShares FTSE RAFI US 1000 Portfolio (PRF) | PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
$ | 45,938,852 | $ | 31,090,567 | $ | 8,550,955 | $ | 7,804,825 | |||||||
119,763,331 | 63,846,705 | 79,175,946 | 33,918,746 | |||||||||||
316,724,319 | 215,084,872 | 69,309,882 | 44,374,003 | |||||||||||
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482,426,502 | 310,022,144 | 157,036,783 | 86,097,574 | |||||||||||
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| |||||||
(42,658,537 | ) | (30,575,583 | ) | (7,637,848 | ) | (7,992,111 | ) | |||||||
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| |||||||
1,350,714,852 | 319,681,049 | 443,192,650 | 130,742,268 | |||||||||||
(263,236,412 | ) | (209,338,770 | ) | (197,623,306 | ) | (108,729,552 | ) | |||||||
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| |||||||
1,087,478,440 | 110,342,279 | 245,569,344 | 22,012,716 | |||||||||||
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1,527,246,405 | 389,788,840 | 394,968,279 | 100,118,179 | |||||||||||
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1,778,450,051 | 1,388,661,211 | 563,762,716 | 463,644,537 | |||||||||||
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| |||||||
$ | 3,305,696,456 | $ | 1,778,450,051 | $ | 958,730,995 | $ | 563,762,716 | |||||||
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$ | 7,365,319 | $ | 4,084,962 | $ | 1,928,173 | $ | 1,093,435 | |||||||
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| |||||||
17,000,000 | 4,900,000 | 4,700,000 | 1,800,000 | |||||||||||
(3,200,000 | ) | (3,250,000 | ) | (2,000,000 | ) | (1,500,000 | ) | |||||||
24,900,000 | 23,250,000 | 7,250,000 | 6,950,000 | |||||||||||
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38,700,000 | 24,900,000 | 9,950,000 | 7,250,000 | |||||||||||
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| 47 |
|
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 55.40 | $ | 51.32 | $ | 53.76 | $ | 45.15 | $ | 32.83 | ||||||||||
Net investment income(a) | 0.21 | 0.71 | (b) | 0.10 | 0.07 | 0.01 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 9.00 | 4.18 | (2.50 | ) | 8.65 | 12.36 | ||||||||||||||
Total from investment operations | 9.21 | 4.89 | (2.40 | ) | 8.72 | 12.37 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.27 | ) | (0.81 | ) | (0.04 | ) | (0.11 | ) | (0.05 | ) | ||||||||||
Net asset value at end of year | $ | 64.34 | $ | 55.40 | $ | 51.32 | $ | 53.76 | $ | 45.15 | ||||||||||
Market price at end of year(c) | $ | 64.32 | $ | 55.32 | $ | 51.30 | $ | 53.75 | $ | 45.15 | ||||||||||
Net Asset Value Total Return(d) | 16.64 | % | 9.75 | % | (4.46 | )% | 19.34 | % | 37.73 | % | ||||||||||
Market Price Total Return(d) | 16.77 | % | 9.63 | % | (4.48 | )% | 19.31 | % | 37.73 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 25,734 | $ | 22,160 | $ | 28,224 | $ | 40,321 | $ | 40,635 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.60 | %(e) | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | ||||||||||
Expenses, prior to Waivers | 0.91 | %(e) | 0.95 | % | 0.93 | % | 0.91 | % | 0.85 | % | ||||||||||
Net investment income, after Waivers | 0.32 | % | 1.42 | %(b) | 0.22 | % | 0.15 | % | 0.01 | % | ||||||||||
Portfolio turnover rate(f) | 296 | % | 118 | % | 99 | % | 75 | % | 90 | % |
PowerShares Dynamic Market Portfolio (PWC)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 56.26 | $ | 46.78 | $ | 48.26 | $ | 40.38 | $ | 31.42 | ||||||||||
Net investment income(a) | 0.60 | 0.82 | 0.44 | 0.57 | 0.33 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 13.99 | 9.51 | (1.52 | ) | 7.94 | 8.97 | ||||||||||||||
Total from investment operations | 14.59 | 10.33 | (1.08 | ) | 8.51 | 9.30 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.58 | ) | (0.85 | ) | (0.40 | ) | (0.63 | ) | (0.34 | ) | ||||||||||
Net asset value at end of year | $ | 70.27 | $ | 56.26 | $ | 46.78 | $ | 48.26 | $ | 40.38 | ||||||||||
Market price at end of year(c) | $ | 70.27 | $ | 56.23 | $ | 46.75 | $ | 48.24 | $ | 40.38 | ||||||||||
Net Asset Value Total Return(d) | 26.09 | % | 22.39 | % | (2.12 | )% | 21.34 | % | 29.75 | % | ||||||||||
Market Price Total Return(d) | 26.15 | % | 22.40 | % | (2.14 | )% | 21.29 | % | 29.80 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 186,219 | $ | 140,658 | $ | 128,644 | $ | 188,207 | $ | 230,151 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | ||||||||||
Expenses, prior to Waivers | 0.60 | % | 0.60 | % | 0.62 | % | 0.64 | % | 0.60 | % | ||||||||||
Net investment income, after Waivers | 0.94 | % | 1.68 | % | 1.00 | % | 1.38 | % | 0.92 | % | ||||||||||
Portfolio turnover rate(f) | 244 | % | 166 | % | 133 | % | 107 | % | 98 | % |
(a) | Based on average shares outstanding. |
(b) | Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $4 per share owned of Warner Chilcott PLC on August 29, 2012. Net investment income per share and the ratio of net investment income to average net assets excluding the special dividend are $0.43 and 0.87%, respectively. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the investment companies in which the Fund invests. Estimated investment company expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the investment companies and are deducted from the value of the funds that the Fund invests in. The effect of the estimated investment company expenses that you bear indirectly is included in the Fund’s total return. |
(f) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. For the fiscal year ended April 30, 2014, the portfolio turnover calculation for PowerShares DWA NASDAQ Momentum Portfolio includes the value of securities purchased and sold in the effort to realign the Fund’s Portfolio holdings due to the underlying index change. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 48 |
|
Financial Highlights (continued)
PowerShares FTSE RAFI US 1000 Portfolio (PRF)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 71.42 | $ | 59.73 | $ | 60.72 | $ | 52.93 | $ | 34.78 | ||||||||||
Net investment income(a) | 1.45 | 1.31 | 1.12 | 1.07 | 0.62 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 13.89 | 11.66 | (0.99 | ) | 7.63 | 18.21 | ||||||||||||||
Total from investment operations | 15.34 | 12.97 | 0.13 | 8.70 | 18.83 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (1.34 | ) | (1.28 | ) | (1.12 | ) | (0.91 | ) | (0.68 | ) | ||||||||||
Net asset value at end of year | $ | 85.42 | $ | 71.42 | $ | 59.73 | $ | 60.72 | $ | 52.93 | ||||||||||
Market price at end of year(b) | $ | 85.37 | $ | 71.42 | $ | 59.72 | $ | 60.71 | $ | 52.96 | ||||||||||
Net Asset Value Total Return(c) | 21.68 | % | 22.06 | % | 0.41 | % | 16.72 | % | 54.57 | % | ||||||||||
Market Price Total Return(c) | 21.61 | % | 22.09 | % | 0.41 | % | 16.63 | % | 54.66 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 3,305,696 | $ | 1,778,450 | $ | 1,388,661 | $ | 1,208,246 | $ | 648,428 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.39 | % | 0.39 | % | 0.39 | % | ||||||||||
Expenses, prior to Waivers | 0.41 | % | 0.43 | % | 0.43 | % | 0.44 | % | 0.45 | % | ||||||||||
Net investment income, after Waivers | 1.84 | % | 2.10 | % | 2.00 | % | 2.01 | % | 1.38 | % | ||||||||||
Portfolio turnover rate(d) | 12 | % | 13 | % | 6 | % | 9 | % | 24 | % |
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 77.76 | $ | 66.71 | $ | 70.66 | $ | 59.82 | $ | 34.96 | ||||||||||
Net investment income(a) | 0.98 | 1.13 | 0.73 | 0.50 | 0.32 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 18.52 | 11.08 | (4.04 | ) | 10.80 | 24.88 | ||||||||||||||
Total from investment operations | 19.50 | 12.21 | (3.31 | ) | 11.30 | 25.20 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.91 | ) | (1.16 | ) | (0.64 | ) | (0.46 | ) | (0.34 | ) | ||||||||||
Net asset value at end of year | $ | 96.35 | $ | 77.76 | $ | 66.71 | $ | 70.66 | $ | 59.82 | ||||||||||
Market price at end of year(b) | $ | 96.38 | $ | 77.67 | $ | 66.72 | $ | 70.64 | $ | 59.79 | ||||||||||
Net Asset Value Total Return(c) | 25.22 | % | 18.56 | % | (4.60 | )% | 19.04 | % | 72.38 | %(e) | ||||||||||
Market Price Total Return(c) | 25.40 | % | 18.41 | % | (4.56 | )% | 19.06 | % | 72.59 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 958,731 | $ | 563,763 | $ | 463,645 | $ | 409,826 | $ | 284,135 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.39 | % | 0.39 | % | 0.39 | % | ||||||||||
Expenses, prior to Waivers | 0.42 | % | 0.43 | % | 0.44 | % | 0.46 | % | 0.51 | % | ||||||||||
Net investment income, after Waivers | 1.08 | % | 1.64 | % | 1.17 | % | 0.82 | % | 0.67 | % | ||||||||||
Portfolio turnover rate(d) | 31 | % | 30 | % | 15 | % | 19 | % | 16 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(e) | Amount includes the effect of the Adviser pay-in for an economic loss of $0.17 per share. Had the pay-in not been made, the Net Asset Value Total Return would have been 71.89%. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 49 |
|
PowerShares Exchange-Traded Fund Trust
April 30, 2014
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the “Trust”) was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). As of April 30, 2014, the Trust offered fifty-three portfolios. This report includes the following portfolios:
Full Name | Short Name | |
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) (formerly PowerShares Dynamic OTC Portfolio) | “DWA NASDAQ Momentum Portfolio” | |
PowerShares Dynamic Market Portfolio (PWC) | “Dynamic Market Portfolio” | |
PowerShares FTSE RAFI US 1000 Portfolio (PRF) | “FTSE RAFI US 1000 Portfolio” | |
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) | “FTSE RAFI US 1500 Small-Mid Portfolio” |
Each portfolio (each, a “Fund”, and collectively, the “Funds”) represents a separate series of the Trust. The shares of the Funds are referred to herein as “Shares” or “Fund’s Shares.” Each Fund’s Shares are listed and traded on NYSE Arca, Inc., except for Shares of FTSE RAFI US 1500 Small-Mid Portfolio, which are listed and traded on The NASDAQ Stock Market LLC.
The market prices of each Fund’s Shares may differ to some degree from the Fund’s net asset value (“NAV”). Unlike conventional mutual funds, each Fund issues and redeems Shares on a continuous basis, at NAV, only in a large specified number of Shares, each called a “Creation Unit.” Creation Units are issued and redeemed in exchange for the deposit or delivery of a basket of securities (“Deposit Securities”). Except when aggregated in Creation Units by Authorized Participants, the Shares are not individually redeemable securities of the Funds.
The investment objective of each Fund is to seek investment results that generally correspond (before fees and expenses) to the price and yield of its respective index listed below (each, an “Underlying Index”):
Fund | Underlying Index | |
DWA NASDAQ Momentum Portfolio | Dorsey Wright NASDAQ Technical Leaders Index | |
Dynamic Market Portfolio | Dynamic Market IntellidexSM Index | |
FTSE RAFI US 1000 Portfolio | FTSE RAFI US 1000 Index | |
FTSE RAFI US 1500 Small-Mid Portfolio | FTSE RAFI US 1500 Small-Mid Index |
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates. In addition, the Funds monitor for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policies.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and ask prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and ask prices. For purposes of determining NAV per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end of day NAV per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
| 50 |
|
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Securities with a demand feature exercisable within one to seven days are valued at par. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that Invesco PowerShares Capital Management LLC (the “Adviser”) determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith following procedures approved by the Board of Trustees. Issuer-specific events, market trends, bid/ask quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
Each Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain of each Fund’s investments.
Valuations change in response to many factors, including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. Other Risks
Index Risk. Unlike many investment companies, the Funds do not utilize investing strategies that seek returns in excess of their Underlying Indexes. Therefore, a Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its respective Underlying Index, even if that security generally is underperforming.
Equity Risk. Equity risk is the risk that the value of the securities that each Fund holds will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities a Fund holds participate or factors relating to specific companies in which the Funds invest. For example, an adverse event, such as an unfavorable earnings report, may depress the value of securities a Fund holds; the price of securities may be particularly sensitive to general movements in the stock market; or a drop in the stock market may depress the price of most or all of the securities a Fund holds. In addition, securities of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition.
Industry Concentration Risk. In following its methodology, each Fund’s Underlying Index from time to time may be concentrated to a significant degree in securities of issuers located in a single industry or a sector. To the extent that an Underlying Index concentrates in the securities of issuers in a particular industry or sector, each Fund will also concentrate its investments to approximately the same extent. By concentrating its investments in an industry or sector, a Fund may face more risks than if it were diversified broadly over numerous industries or sectors. In addition, at times, an industry or sector may be out of favor and underperform other industries or the market as a whole. Any factors detrimental to the performance of such industry or sector will disproportionately impact a Fund’s NAV.
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Non-Correlation Risk. Each Fund’s return may not match the return of its Underlying Index for a number of reasons. For example, each Fund incurs operating expenses not applicable to its Underlying Index, and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of its Underlying Index. In addition, the performance of each Fund and its Underlying Index may vary due to asset valuation differences and differences between each Fund’s portfolio and its Underlying Index resulting from legal restrictions, cost or liquidity constraints.
Small and Medium Capitalization Company Risk. For DWA NASDAQ Momentum Portfolio and FTSE RAFI US 1500 Small-Mid Portfolio, investing in securities of small and medium capitalization companies involves greater risk than customarily is associated with investing in larger, more established companies. These companies’ securities may be more volatile and less liquid than those of more established companies. These securities may have returns that vary, sometimes significantly, from the overall securities market. Often small and medium capitalization companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and to distribute substantially all of the Fund’s taxable earnings to its shareholders. As such, the Funds will not be subject to federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements.
Each Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed each Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These timing differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and passive foreign investment company adjustments, if any.
The Funds file U.S. federal tax returns and tax returns in certain other jurisdictions. Generally, a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Transactions and Investment Income
Investment transactions are accounted for on a trade date basis. Realized gains and losses from the sale or disposition of securities are computed on the specific identified cost basis. Interest income is recorded on the accrual basis. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. Realized gains, dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date.
E. Expenses
Expenses of the Trust that are directly identifiable to a specific Fund are applied to that Fund. Expenses of the Trust that are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, sub-licensing fees related to its respective Underlying Index, any distribution fees or expenses, litigation expenses, fees payable to the Trust’s Board members who are not “interested persons” (as defined in the 1940 Act) of the Trust (the “Independent Trustees”) or the Adviser, expenses incurred in connection with the Board members’ services, including travel expenses and legal fees of counsel for the Independent Trustees, acquired fund fees and expenses, if any, and extraordinary expenses.
To the extent a Fund invests in other investment companies, the expenses shown in the accompanying financial statements reflect the expenses of the Fund and do not include any expenses of the investment companies in which it invests. The effects of such investment companies’ expenses are included in the realized and unrealized gain or loss on the investments in the investment companies.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and records such dividends on ex-dividend date. Generally, each Fund distributes net realized taxable capital gains, if any, annually in cash and records them on ex-dividend date. Such distributions on a tax basis are determined in conformity with federal income tax regulations, which may differ from GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund’s financial statements as a tax return of capital at fiscal period-end.
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G. Securities Lending
FTSE RAFI US 1000 Portfolio and FTSE RAFI US 1500 Small-Mid Portfolio may lend portfolio securities having a market value up to one-third of each Fund’s total assets. Such loans are secured by cash collateral equal to no less than 102% of the market value of the loaned securities determined daily by the securities lending provider. Cash collateral received in connection with these loans is invested in an affiliated money market fund and is shown as such on the Schedule of Investments. It is the policy of these Funds to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to a Fund if, and to the extent that, the market value of the securities loaned were to increase, and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. A Fund could experience delays and costs in gaining access to the collateral. A Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Securities lending income on the Statements of Operations. The aggregate value of securities out on loan is shown on the Statements of Assets and Liabilities, if any.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser pursuant to which the Adviser has overall responsibility for the selection and ongoing monitoring of the Funds’ investments, managing the Funds’ business affairs and providing certain clerical, bookkeeping and other administrative services. Each of DWA NASDAQ Momentum Portfolio and Dynamic Market Portfolio has agreed to pay the Adviser an annual fee of 0.50% of the Fund’s average daily net assets. Each of FTSE RAFI US 1000 Portfolio and FTSE RAFI US 1500 Small-Mid Portfolio has agreed to pay the Adviser an annual fee of 0.29% of the Fund’s average daily net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement (the “Expense Agreement”) with the Trust, on behalf of each Fund. For the FTSE RAFI US 1000 Portfolio and the FTSE RAFI US 1500 Small-Mid Portfolio, the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses (excluding interest expenses, brokerage commissions and other trading expenses, offering costs, taxes, acquired fund fees and expenses, if any, and extraordinary expenses) of the Fund from exceeding 0.39% of the Fund’s average daily net assets per year (the “Expense Cap”), through at least August 31, 2015. Offering costs excluded from the Expense Cap are: (a) initial legal fees pertaining to the Funds’ Shares offered for sale; (b) initial Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange. For the DWA NASDAQ Momentum Portfolio and the Dynamic Market Portfolio, the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of each Fund (excluding interest expenses, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses, if any, and extraordinary expenses) from exceeding 0.60% of the Fund’s average daily net assets per year, through at least August 31, 2015. Prior to February 19, 2014, sub-licensing fees for DWA NASDAQ Momentum Portfolio were excluded from the expenses subject to the Expense Cap. Unless the Adviser continues the Expense Agreement, it will terminate on August 31, 2015. The Expense Agreement cannot be terminated during its term.
Further, through August 31, 2015, the Adviser has contractually agreed to waive a portion of the Fund’s management fee in an amount equal to 100% of the net advisory fees an affiliate of the Adviser receives that are attributable to certain of the Fund’s investments in money market funds managed by that affiliate (excluding investments of cash collateral from securities lending). The Adviser cannot discontinue this waiver prior to its expiration.
For the fiscal year ended April 30, 2014, the Adviser waived fees and/or paid Fund expenses for each Fund, in the following amounts:
DWA NASDAQ Momentum Portfolio | $ | 79,738 | ||
Dynamic Market Portfolio | 7,030 | |||
FTSE RAFI US 1000 Portfolio | 638,184 | |||
FTSE RAFI US 1500 Small-Mid Portfolio | 274,370 |
For the FTSE RAFI US 1000 Portfolio and the FTSE RAFI US 1500 Small-Mid Portfolio, the Expense Agreement provides that the fees waived or expenses borne by the Adviser are subject to recapture by the Adviser for up to three years, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above. For the DWA NASDAQ Momentum Portfolio and the Dynamic Market Portfolio, the expenses borne by the Adviser are not subject to recapture.
For the following Funds, the amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2014 are as follows:
Total Potential Recapture Amounts | Potential Recapture Amounts Expiring | |||||||||||||||
04/30/15 | 04/30/16 | 04/30/17 | ||||||||||||||
FTSE RAFI US 1000 Portfolio | $ | 1,577,712 | $ | 420,812 | $ | 519,689 | $ | 637,211 | ||||||||
FTSE RAFI US Portfolio 1500 Small-Mid Portfolio | 671,879 | 186,171 | 211,738 | 273,970 |
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The Trust has entered into a Distribution Agreement with Invesco Distributors, Inc. (the “Distributor”), which serves as the distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in the Shares. The Funds are not charged any fees pursuant to the Distribution Agreement. The Distributor is an affiliate of the Adviser.
The Adviser has entered into a licensing agreement for each Fund with the following entities (each, a “Licensor”):
Fund | Licensor | |
DWA NASDAQ Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
Dynamic Market Portfolio | NYSE Arca, Inc. | |
FTSE RAFI US 1000 Portfolio | FTSE International Ltd. | |
FTSE RAFI US 1500 Small-Mid Portfolio | FTSE International Ltd. |
* | Effective February 19, 2014, Dorsey Wright & Associates, Inc. replaced NYSE Arca, Inc. as the Index Provider of the Index. |
Each Underlying Index name trademark is owned by its respective Licensor. These trademarks have been licensed to the Adviser for use by the Funds. Each Fund is entitled to use its Underlying Index pursuant to the Trust’s sub-licensing agreement with the Adviser. The Funds are required to pay the sub-licensing fees that are shown on the Statements of Operations. The Funds are not sponsored, endorsed, sold or promoted by the Licensors, and the Licensors make no representation regarding the advisability of investing in any of the Funds.
The Trust has entered into service agreements whereby The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian, fund accountant and transfer agent for each Fund.
Note 4. Investments in Affiliates
Each Fund’s Adviser and Invesco Mortgage Capital, Inc. REIT are wholly-owned subsidiaries of Invesco Ltd., and therefore Invesco Ltd. and Invesco Mortgage Capital, Inc. REIT are considered to be affiliated. The table below shows the Fund’s transactions in, and earnings from, its investments in Invesco Ltd. and Invesco Mortgage Capital, Inc. REIT for the fiscal year ended April 30, 2014.
FTSE RAFI US 1000 Portfolio
Value April 30, 2013 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation (Depreciation) | Realized Gain | Value April 30, 2014 | Dividend Income | ||||||||||||||||||||||
Invesco Ltd. | $ | 1,352,664 | $ | 1,054,369 | $ | (341,955 | ) | $ | 167,793 | $ | 18,738 | $ | 2,251,609 | $ | 47,765 | |||||||||||||
Invesco Mortgage Capital, Inc. REIT | 215,926 | 479,000 | (6,508 | ) | (59,926 | ) | 400 | 628,892 | 38,187 | |||||||||||||||||||
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Total Investments in Affiliates | $ | 1,568,590 | $ | 1,533,369 | $ | (348,463 | ) | $ | 107,867 | $ | 19,138 | $ | 2,880,501 | $ | 85,952 | |||||||||||||
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Note 5. Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
Except for the Fund listed below, as of April 30, 2014, all of the securities in each Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
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Investments in Securities | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
FTSE RAFI US 1000 Portfolio | ||||||||||||||||
Equity Securities | $ | 3,332,920,045 | $ | — | $ | 172,182 | $ | 3,333,092,227 | ||||||||
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FTSE RAFI US 1500 Small-Mid Portfolio | ||||||||||||||||
Equity Securities | $ | 1,017,833,434 | $ | 88,654 | $ | — | $ | 1,017,922,088 | ||||||||
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Note 6. Distributions to Shareholders and Tax Components of Net Assets
Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended April 30, 2014 and 2013:
2014 | 2013 | |||||||
Ordinary Income | Ordinary Income | |||||||
DWA NASDAQ Momentum Portfolio | $ | 102,874 | $ | 376,429 | ||||
Dynamic Market Portfolio | 1,443,855 | 2,277,011 | ||||||
FTSE RAFI US 1000 Portfolio | 42,658,537 | 30,575,583 | ||||||
FTSE RAFI US 1500 Small-Mid Portfolio | 7,637,848 | 7,992,111 |
Tax Components of Net Assets at Fiscal Year-End:
Undistributed Ordinary Income | Temporary Book/Tax Differences | Net Unrealized Appreciation (Depreciation)— Investment Securities | Net Unrealized Appreciation— Other Investments | Capital Loss Carryforward | Late-Year Ordinary/ Post- October Capital Losses Deferrals* | Shares of Beneficial Interest | Total Net Assets | |||||||||||||||||||||||||
DWA NASDAQ Momentum Portfolio** | $ | — | $ | (11,484 | ) | $ | (2,235,595 | ) | $ | — | $ | (74,481,446 | ) | $ | (1,567 | ) | $ | 102,464,420 | $ | 25,734,328 | ||||||||||||
Dynamic Market Portfolio | 257,679 | (23,760 | ) | 6,027,706 | — | (357,158,755 | ) | — | 537,115,941 | 186,218,811 | ||||||||||||||||||||||
FTSE RAFI US 1000 Portfolio** | 7,430,600 | (65,281 | ) | 576,058,530 | — | (140,476,692 | ) | (832,098 | ) | 2,863,581,397 | 3,305,696,456 | |||||||||||||||||||||
FTSE RAFI US 1500 Small-Mid Portfolio** | 2,087,667 | (25,486 | ) | 102,380,602 | 938 | (16,052,311 | ) | (2,534,878 | ) | 872,874,463 | 958,730,995 |
* | Includes net capital losses incurred after October 31 (“Post-October Capital losses”) and the combination of ordinary losses incurred after December 31 within the taxable year and specified losses incurred after October 31 within the taxable year (“Late-Year Ordinary Losses”), that are deemed to arise on the first business day of each Fund’s next taxable year. |
** | The DWA NASDAQ Momentum Portfolio, FTSE RAFI US 1000 Portfolio and FTSE RAFI US 1500 Small-Mid Portfolio incurred and will elect to defer Late-Year Ordinary Losses of $1,567, $0 and $0 and Post-October Capital Losses of $0, $832,098 and $2,534,878, respectively. |
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Funds to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in 8 tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The following Funds have capital loss carryforwards as of April 30, 2014, which expire as follows:
Post-effective no expiration | ||||||||||||||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Short-term | Long-term | Total* | Utilized | Expired | |||||||||||||||||||||||||||||||
DWA NASDAQ Momentum Portfolio | $ | 21,767,708 | $ | 11,353,752 | $ | 15,764,010 | $ | 14,947,690 | $ | 3,683,431 | $ | 6,964,855 | $ | — | $ | 74,481,446 | $ | 1,207,581 | $ | 5,449,844 | ||||||||||||||||||||
Dynamic Market Portfolio | 65,552,628 | 39,899,556 | 96,635,542 | 104,214,879 | 15,461,574 | 35,227,451 | 167,125 | 357,158,755 | 179,727 | 13,686,812 | ||||||||||||||||||||||||||||||
FTSE RAFI US 1000 Portfolio | 44,432 | 1,148,192 | 44,806,580 | 49,808,238 | 38,490,195 | — | 6,179,055 | 140,476,692 | — | — | ||||||||||||||||||||||||||||||
FTSE RAFI US 1500 Small-Mid Portfolio | 5,818 | 128,460 | 8,229,508 | 5,168,127 | 2,475,894 | — | 44,504 | 16,052,311 | 1,644,991 | — |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
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Note 7. Investment Transactions
For the fiscal year ended April 30, 2014, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, U.S. Treasury obligations, money market funds and in-kind transactions, were as follows:
Purchases | Sales | |||||||
DWA NASDAQ Momentum Portfolio | $ | 73,696,071 | $ | 73,313,573 | ||||
Dynamic Market Portfolio | 391,706,148 | 389,612,628 | ||||||
FTSE RAFI US 1000 Portfolio | | 315,830,067 | | | 310,258,745 | | ||
FTSE RAFI US Portfolio 1500 Small-Mid Portfolio | 248,980,027 | 246,087,276 |
For the fiscal year ended April 30, 2014, in-kind transactions associated with creations and redemptions were as follows:
Cost of Securities Received | Value of Securities Delivered | |||||||
DWA NASDAQ Momentum Portfolio | $ | 38,045,327 | $ | 37,573,718 | ||||
Dynamic Market Portfolio | 309,549,321 | 301,430,830 | ||||||
FTSE RAFI US 1000 Portfolio | | 1,347,552,939 | | | 261,441,317 | | ||
FTSE RAFI US Portfolio 1500 Small-Mid Portfolio | 441,408,106 | 196,362,194 |
Gains (losses) on in-kind transactions are generally not considered taxable gains (losses) for federal income tax purposes.
At April 30, 2014, the aggregate cost and the net unrealized appreciation (depreciation) of investments for tax purposes were as follows:
Cost | Net Unrealized Appreciation (Depreciation) | Gross Unrealized Appreciation | Gross Unrealized (Depreciation) | |||||||||||||
DWA NASDAQ Momentum Portfolio | $ | 28,023,884 | $ | (2,235,595 | ) | $ | 657,976 | $ | (2,893,571 | ) | ||||||
Dynamic Market Portfolio | 180,241,843 | 6,027,706 | 10,726,989 | (4,699,283 | ) | |||||||||||
FTSE RAFI US 1000 Portfolio | 2,757,033,697 | 576,058,530 | 599,229,435 | (23,170,905 | ) | |||||||||||
FTSE RAFI US 1500 Small-Mid Portfolio | 915,541,486 | 102,380,602 | 142,392,766 | (40,012,164 | ) |
Note 8. Reclassification of Permanent Differences
Primarily as a result of differing book/tax treatment of in-kind transactions on April 30, 2014, amounts were reclassified between undistributed net investment income (loss), undistributed net realized gain (loss) and shares of beneficial interest. These reclassifications had no effect on the net assets of each Fund. For the fiscal year ended April 30, 2014, the reclassifications were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Net Realized Gain (Loss) | Shares of Beneficial Interest | ||||||||||
DWA NASDAQ Momentum Portfolio | $ | 7,049 | $ | (34,709 | ) | $ | 27,660 | |||||
Dynamic Market Portfolio | 18,654 | (27,691,569 | ) | 27,672,915 | ||||||||
FTSE RAFI US 1000 Portfolio | 42 | (116,445,535 | ) | 116,445,493 | ||||||||
FTSE RAFI US 1500 Small-Mid Portfolio | (78,369 | ) | (84,586,379 | ) | 84,664,748 |
Note 9. Trustees’ and Officer’s Fees
Trustees’ and Officer’s Fees include amounts accrued by the Funds to pay remuneration to the Independent Trustees and Officer of the Funds. The Trustee who is an “interested person” (the “Non-Independent Trustee”) of the Trust does not receive any Trustees’ fees.
The Trust has adopted a deferred compensation plan (the “Plan”). Under the Plan, an Independent Trustee who has executed a Deferred Fee Agreement (a “Participating Trustee”) may defer receipt of all or a portion of his compensation (“Deferral Fees”). Such Deferral Fees are deemed to be invested in select PowerShares Funds. The Deferral Fees payable to the Participating Trustee are valued as of the date such Deferral Fees would have been paid to the Participating Trustee. The value increases with contributions or with increases in the value of the Shares selected, and the value decreases with distributions or with declines in the value of the Shares selected. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Funds.
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Note 10. Capital
Shares are created and redeemed by each Fund only in Creation Units of 50,000 Shares. Only Authorized Participants are permitted to purchase or redeem Creation Units from the Funds. Such transactions are generally permitted in exchange for Deposit Securities, with a balancing cash component to equate the transaction to the NAV per Share of a Fund of the Trust on the transaction date. However, for all Funds, cash in an amount equivalent to the value of certain securities may be substituted, generally when the securities are not available in sufficient quantity for delivery, not eligible for trading by the Authorized Participant or as a result of other market circumstances.
To the extent that the Funds permit transactions in exchange for Deposit Securities, each Fund may issue Shares in advance of receipt of Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to 105% of the market value of the missing Deposit Securities. In accordance with each Fund’s Participant Agreement, Creation Units will be issued to an Authorized Participant, notwithstanding the fact that the corresponding Deposit Securities have not been received in part or in whole, in reliance on the undertaking of the Authorized Participant to deliver the missing Deposit Securities as soon as possible, which undertaking shall be secured by the Authorized Participant’s delivery and maintenance of collateral consisting of cash in the form of U.S. dollars in immediately available funds having a value (marked-to-market daily) at least equal to 105%, which the Adviser may change from time to time, of the value of the missing Deposit Securities.
Transactions in each Fund’s Shares are disclosed in detail in the Statements of Changes in Net Assets.
Note 11. Indemnifications
Under the Trust’s organizational documents, its officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Each Independent Trustee is also indemnified against certain liabilities arising out of the performance of his duties to the Trust pursuant to an Indemnification Agreement between the Independent Trustee and the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
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Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of PowerShares DWA NASDAQ Momentum Portfolio (formerly PowerShares Dynamic OTC Portfolio), PowerShares Dynamic Market Portfolio, PowerShares FTSE RAFI US 1000 Portfolio and PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (each an individual portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the “Funds”) at April 30, 2014, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2014 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Chicago, IL
June 24, 2014
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As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur advisory fees and other Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2014.
In addition to the fees and expenses which the PowerShares DWA NASDAQ Momentum Portfolio (the “Portfolio”) bears directly, the Portfolio indirectly bears a pro rata share of the fees and expenses of the investment companies in which the Portfolio invests. The amount of fees and expenses incurred indirectly by the Portfolio will vary because the investment companies have varied expenses and fee levels and the Portfolio may own different proportions of the investment companies at different times. Estimated investment companies’ expenses are not expenses that are incurred directly by the Portfolio. They are expenses that are incurred directly by the investment companies and are deducted from the value of the investment companies the Portfolio invests in. The effect of the estimated investment companies’ expenses that you bear indirectly are included in the Portfolio’s total returns.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds’ actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as sales charges and brokerage commissions. Therefore, the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by a Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares DWA NASDAQ Momentum Portfolio (DWAQ) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,003.58 | 0.60 | % | $ | 2.98 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.82 | 0.60 | 3.01 | ||||||||||||
Powershares Dynamic Market Portfolio (PWC) | ||||||||||||||||
Actual | 1,000.00 | 1,099.16 | 0.60 | 3.12 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.82 | 0.60 | 3.01 | ||||||||||||
PowerShares FTSE RAFI US 1000 Portfolio (PRF) | ||||||||||||||||
Actual | 1,000.00 | 1,091.58 | 0.39 | 2.02 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (PRFZ) | ||||||||||||||||
Actual | 1,000.00 | 1,051.56 | 0.39 | 1.98 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 |
(1) | Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2014. Expenses are calculated by multiplying the Fund’s annualized expense ratio by the average account value for the period, then multiplying the result by 181/365. Expense ratios for the most recent half-year may differ from expense ratios based on the annualized data in the Financial Highlights. |
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Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.
The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state’s requirement.
Each Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended April 30, 2014:
Federal Income Tax Information
Qualified Dividend Income* | Dividends Received Deduction* | |||||||||
DWA NASDAQ Momentum Portfolio | 100 | % | 99 | % | ||||||
Dynamic Market Portfolio | 100 | % | 100 | % | ||||||
FTSE RAFI US 1000 Portfolio | 100 | % | 100 | % | ||||||
FTSE RAFI US 1500 Small-Mid Portfolio | 88 | % | 82 | % |
* | The above percentages are based on ordinary income dividends paid to shareholders during the Fund’s fiscal year. |
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The Independent Trustees, the Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by each Trustee are shown below.
The Trustees and officers information is current as of April 30, 2014.
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Ronn R. Bagge (1958) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Founder and Principal, YQA Capital Management LLC (1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider). | 114 | None | |||||
Todd J. Barre (1957) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2010 | Assistant Professor of Business, Trinity Christian College (2010-Present); formerly Vice President and Senior Investment Strategist (2001-2008), Director of Open Architecture and Trading (2007-2008), Head of Fundamental Research (2004-2007) and Vice President and Senior Fixed Income Strategist (1994-2001), BMO Financial Group/Harris Private Bank. | 114 | None | |||||
Marc M. Kole (1960) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2006 | Chief Financial Officer, Hope Network (social services) (2008-2012); formerly, Assistant Vice President and Controller, Priority Health (health insurance) (2005-2008); Senior Vice President of Finance, United Healthcare (2004-2005); Senior Vice President of Finance, Oxford Health Plans (2000-2004). | 114 | None | |||||
Yung Bong Lim (1964) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Managing Partner, Residential Dynamics Group LLC (2008-Present); formerly, Managing Director, Citadel Investment Group, L.L.C. (1999-2007). | 114 | None | |||||
Philip M. Nussbaum (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (2004-Present). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Gary R. Wicker (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Senior Vice President of Global Finance and Chief Financial Officer at RBC Ministries (publishing company) (2013-Present); formerly, Executive Vice President and Chief Financial Officer, Zondervan Publishing (a division of Harper Collins/NewsCorp) (2007-2012); Senior Vice President and Group Controller (2005-2006), Senior Vice President and Chief Financial Officer (2003-2004), Chief Financial Officer (2001-2003), Vice President, Finance and Controller (1999-2001) and Assistant Controller (1997-1999), divisions of The Thomson Corporation (information services provider). | 114 | None | |||||
Donald H. Wilson (1959) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Chairman of the Board and Trustee | Chairman since 2012; Trustee since 2006 | Chairman, President and Chief Executive Officer, Community Financial Shares, Inc. and Community Bank—Wheaton/Glen Ellyn (subsidiary) (2013-Present); Chairman and Chief Executive Officer, Stone Pillar Advisers, Ltd. (2010-Present); formerly, Chief Operating Officer, AMCORE Financial, Inc. (bank holding company) (2007-2009); Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (2006-2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (1995-2006). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
The Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by the Non-Independent Trustee and the other directorships, if any, held by the Non-Independent Trustee are shown below.
Name, Address and Age of Non-Independent Trustee | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Non-Independent Trustee | Other Directorships Held by Non-Independent Trustee During the Past 5 Years | |||||
Kevin M. Carome (1956) Invesco Ltd. Two Peachtree Pointe 1555 Peachtree St., N.E., Suite 1800 Atlanta, GA 30309 | Trustee | Since 2010 | Senior Managing Director, Secretary and General Counsel, Invesco Ltd. (2006-Present); Director, Invesco Advisers, Inc. (2009-Present); Director, Invesco Advisers, Inc., Invesco Finance PLC, INVESCO Funds Group, Inc., and Invesco Holding Company Limited; Director and Executive Vice President, Invesco Finance, Inc., Invesco Group Services, Inc., Invesco Investments (Bermuda) Ltd., Invesco North American Holdings, Inc., and IVZ, Inc.; Director and Secretary, IVZ Bahamas Private Limited; formerly, Senior Vice President, Secretary and General Counsel, Invesco Advisers, Inc. (2003-2005); Senior Vice President and General Counsel, Liberty Financial Companies, Inc. (2000-2001); General Counsel of certain investment management subsidiaries of Liberty Financial Companies, Inc. (1998-2000); Associate General Counsel, Liberty Financial Companies, Inc. (1993-1998); Associate, Ropes & Gray LLP. | 114 | None |
* | This is the date the Non-Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Andrew Schlossberg (1974) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046 | President | Since 2009 | Director, Invesco Distributors, Inc. (2012-Present); Managing Director—U.S. Strategy and Marketing, Invesco PowerShares Capital Management LLC (2010-Present); Managing Director, U.S. head of business strategy and chief marketing officer for Invesco Ltd. in the United States (2008-Present); Director, Invesco Distributors, Inc. (2012-Present); and Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present); formerly, Mr. Schlossberg served in multiple roles within Invesco, including head of corporate development, as well as global leadership roles in strategy and product development in the company’s North American Institutional and Retirement divisions (2002-2007). | |||
Peter Hubbard (1981) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2009 | Vice President and Director of Portfolio Management—Invesco PowerShares Capital Management LLC (2008-Present); formerly, Portfolio Manager, Invesco PowerShares Capital Management LLC (2007-2008); Research Analyst, Invesco PowerShares Capital Management LLC (2005-2007); Research Analyst and Trader, Ritchie Capital, a hedge fund operator (2003-2005). | |||
David Warren (1957) Invesco Canada Ltd. 5140 Yonge Street Suite 900, Toronto, Ontario M2N 6X7 | Vice President | Since 2009 | Managing Director—Chief Administrative Officer, Americas, Invesco PowerShares Capital Management LLC; Senior Vice President, Invesco Advisers, Inc. (2009-Present); Director, Executive Vice President and Chief Financial Officer, Invesco Inc. (2009-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) and Chief Administrative Officer, North American Retail, Invesco Ltd. (2007-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Invesco Canada Holdings Inc. (2002-Present), Invesco Corporate Class Inc., and Invesco Canada Fund Inc.; Director, Executive Vice President and Chief Financial Officer, Invesco, Inc.; formerly, Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) (2000-2006). | |||
Sheri Morris (1964) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Vice President | Since 2012 | Vice President, Treasurer and Principal Financial Officer, The Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present) and Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; formerly, Treasurer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc. | |||
Rudolf E. Reitmann (1971) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global Exchange Traded Funds Operations, Invesco PowerShares Capital Management LLC (since 2013). |
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Daniel E. Draper (1968) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Senior Vice President, Invesco Distributors, Inc. (since 2014); Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Managing Director, Invesco PowerShares Global ETFs (since 2013); formerly, Managing Director, Credit Suisse Asset Management (2010-2013) and Lyxor Asset Management/Societe Generale (2007–2010). | |||
Steven M. Hill (1964) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President and Treasurer | Since 2013 | Vice President and Treasurer of PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global ETF Administration, Invesco PowerShares Capital Management LLC (since 2011); formerly, Senior Managing Director and Chief Financial Officer, Destra Capital Management LLC and its subsidiaries (2010-2011); Chief Financial Officer, Destra Investment Trust and Destra Investment Trust II (2010-2011); Senior Managing Director, Claymore Securities, Inc. (2003-2010); and Chief Financial Officer, Claymore sponsored mutual funds (2003-2010). | |||
Christopher Joe (1969) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Chief Compliance Officer | Since 2012 | U.S. Compliance Director, Invesco, Ltd. (since 2006); formerly, Chief Compliance Officer, Invesco Investment Advisers, LLC (registered investment adviser) (2010-2013); formerly, Assistant Fund Accounting Manager, Invesco, Ltd. (1998-1999). | |||
Anna Paglia (1974) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Secretary | Since 2011 | Secretary, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (2011-Present); Head of Legal, Invesco PowerShares Capital Management LLC (2010-Present); formerly, Partner, K&L Gates LLP (formerly, Bell Boyd & Lloyd LLP) (2007-2010); Associate Counsel at Barclays Global Investors Ltd. (2004-2006). |
Availability of Additional Information About the Trustees
The Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request at (800) 983-0903.
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for the following 51 series (each, a “Fund” and collectively, the “Funds”):
PowerShares Aerospace & Defense Portfolio
PowerShares BuyBack Achievers™ Portfolio
PowerShares Cleantech™ Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares DWA Momentum Portfolio
PowerShares DWA Basic Materials Momentum Portfolio
PowerShares DWA Consumer Cyclicals Momentum Portfolio
PowerShares DWA Consumer Staples Momentum Portfolio
PowerShares DWA Energy Momentum Portfolio
PowerShares DWA Financial Momentum Portfolio
PowerShares DWA Healthcare Momentum Portfolio
PowerShares DWA Industrials Momentum Portfolio
PowerShares DWA NASDAQ Momentum Portfolio
PowerShares DWA Technology Momentum Portfolio
PowerShares DWA Utilities Momentum Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Building & Construction Portfolio
PowerShares Dynamic Energy Exploration & Production Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Market Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Oil & Gas Services Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Financial Preferred Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares Fundamental Pure Large Core Portfolio
PowerShares Fundamental Pure Large Growth Portfolio
PowerShares Fundamental Pure Large Value Portfolio
PowerShares Fundamental Pure Mid Core Portfolio
PowerShares Fundamental Pure Mid Growth Portfolio
PowerShares Fundamental Pure Mid Value Portfolio
PowerShares Fundamental Pure Small Core Portfolio
PowerShares Fundamental Pure Small Growth Portfolio
PowerShares Fundamental Pure Small Value Portfolio
PowerShares Global Listed Private Equity Portfolio
PowerShares Golden Dragon China Portfolio
PowerShares High Yield Equity Dividend Achievers TM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares S&P 500® High Quality Portfolio
PowerShares Water Resources Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares WilderHill Progressive Energy Portfolio
PowerShares Zacks Micro Cap Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year, ten-year and since-inception periods ended December 31, 2013, as applicable, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
explanations for any tracking error. The Trustees noted that for each applicable period the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s advisory fee and net expense ratio, as compared to information compiled by the Adviser from Lipper Inc. databases on the advisory fees and net expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual advisory fee charged to each Fund is:
— | 0.50% of the Fund’s average daily net assets for each Fund other than PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend AchieversTM Portfolio, PowerShares International Dividend AchieversTM Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio; |
— | 0.40% of the Fund’s average daily net assets for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; and |
— | 0.29% of the Fund’s average daily net assets for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio. |
The Trustees also noted that the Adviser has agreed to waive a portion of its advisory fee and/or pay expenses (an “Expense Cap”) to the extent necessary to prevent the annual operating expenses of each Fund from exceeding the percentage of that Fund’s average daily net assets, at least until August 31, 2015, as set forth below:
— | 0.60%, excluding interest expenses, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares DWA NASDAQ Momentum Portfolio and PowerShares Dynamic Market Portfolio; |
— | 0.50%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; |
— | 0.39%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio and PowerShares Fundamental Pure Small Value Portfolio; |
— | 0.29%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares S&P 500® High Quality Portfolio; |
— | 0.60%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio and PowerShares DWA Utilities Momentum Portfolio (the Trustees noted that prior to December 17, 2013, licensing fees were excluded from the Expense Cap); and |
— | 0.60%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each other Fund. |
The Trustees noted that the Adviser represented that it does not serve as the investment adviser to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds, but that the Adviser provides sub-advisory services to clients with comparable investment strategies as certain of the Funds. The Trustees further noted the Adviser’s explanation with respect to the sub-advisory fees it receives for such services in comparison to the advisory fees charged to the Funds. The Trustees noted that each Fund’s advisory fee was:
— | higher than the median advisory fee of its ETF peer funds (except for the advisory fee of each of PowerShares Financial Preferred Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio and PowerShares International Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its ETF peer funds); and |
— | higher than the median advisory fee of its open-end index peer funds (except for the advisory fee of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares High Yield Equity Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median advisory fee of its open-end actively-managed peer funds. |
The Trustees determined that the advisory fees were reasonable, noting the complexity of the indexes, the distinguishing factors of the Funds, and the administrative, operational and management oversight costs for the Adviser. With respect to the Funds’ net expense ratios, the Trustees noted that the net expense ratio for each Fund was:
— | higher than the median net expense ratio of its ETF peer funds (except for the net expense ratio of each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers Portfolio and PowerShares S&P 500® High Quality Portfolio, which was equal to or less than the median net expense ratio of its ETF peer funds); and |
— | higher than the median net expense ratio of its open-end index peer funds (except for the net expense ratio of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio, PowerShares DWA Utilities Momentum Portfolio, PowerShares Dynamic Large Cap Growth Portfolio, PowerShares Dynamic Networking Portfolio, PowerShares Dynamic Semiconductors Portfolio, PowerShares Dynamic Software Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares High Yield Equity |
| 68 |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Dividend Achievers™ Portfolio and PowerShares S&P 500® High Quality Portfolio, which was lower than the median net expense ratio of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median net expense ratio of its open-end actively-managed peer funds. |
The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds, and noted those Funds for which license fees are included in the Funds’ Expense Caps.
The Board concluded that the advisory fee and expense ratio of each Fund (giving effect to the Fund’s Expense Cap) were reasonable and appropriate in light of the services provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to any of the Funds was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size, expense ratio and expense limitation agreed to by the Adviser. The Trustees noted that, for Funds whose expenses are higher than their respective Expense Caps, any reduction in that Fund’s expenses would be enjoyed by the Adviser, but that Fund shareholders benefit from the lower expense ratio as a result of the Fund’s Expense Cap. The Trustees also noted that the Excess Expense Agreement with the Trust provides that the Adviser is entitled to be reimbursed by each Fund, other than PowerShares Dynamic Market Portfolio and PowerShares DWA NASDAQ Momentum Portfolio, for fees waived or expenses absorbed pursuant to the Expense Cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its Expense Cap. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate, noting the Fund expenses the Adviser has borne as a result of the Expense Cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
| 69 |
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(This Page Intentionally Left Blank)
Proxy Voting Policies and Procedures
A description of the Trust’s proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 983-0903. This information is also available on the Securities and Exchange Commission’s (“Commission”) website at www.sec.gov.
Information regarding how each Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 983-0903; or (ii) accessing the Trust’s Form N-PX on the Commission’s website at www.sec.gov.
Quarterly Portfolios
The Trust files its complete schedule of portfolio holdings for the Funds with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Trust’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Trust’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
Frequency Distribution of Discounts and Premiums
A table showing the number of days the market price of each Fund’s shares was greater than the Fund’s net asset value, and the number of days it was less than the Fund’s net asset value (i.e., premium or discount) for the most recently completed calendar year, and the calendar quarters since that year end (or the life of the Fund, if shorter) may be found at the Fund’s website at www.invescopowershares.com.
©2014 Invesco PowerShares Capital Management LLC | P-PS-AR-2 | |||||
3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | ||||||
invescopowershares.com 800.983.0903 | @PowerShares |
April 30, 2014 |
2014 Annual Report to Shareholders
PWB | PowerShares Dynamic Large Cap Growth Portfolio | |
PWV | PowerShares Dynamic Large Cap Value Portfolio | |
PXLC | PowerShares Fundamental Pure Large Core Portfolio | |
PXLG | PowerShares Fundamental Pure Large Growth Portfolio | |
PXLV | PowerShares Fundamental Pure Large Value Portfolio | |
PXMC | PowerShares Fundamental Pure Mid Core Portfolio | |
PXMG | PowerShares Fundamental Pure Mid Growth Portfolio | |
PXMV | PowerShares Fundamental Pure Mid Value Portfolio | |
PXSC | PowerShares Fundamental Pure Small Core Portfolio | |
PXSG | PowerShares Fundamental Pure Small Growth Portfolio | |
PXSV | PowerShares Fundamental Pure Small Value Portfolio | |
PZI | PowerShares Zacks Micro Cap Portfolio |
The Market Environment | 3 | |||
Manager’s Analysis | 4 | |||
Fundamental Pure and Style Portfolios | ||||
Schedules of Investments | ||||
40 | ||||
41 | ||||
42 | ||||
44 | ||||
45 | ||||
47 | ||||
49 | ||||
51 | ||||
54 | ||||
59 | ||||
64 | ||||
72 | ||||
Statements of Assets and Liabilities | 78 | |||
Statements of Operations | 80 | |||
Statements of Changes in Net Assets | 82 | |||
Financial Highlights | 86 | |||
Notes to Financial Statements | 92 | |||
Report of Independent Registered Public Accounting Firm | 103 | |||
Fees and Expenses | 104 | |||
Tax Information | 106 | |||
Trustees and Officers | 107 | |||
Board Considerations Regarding Continuation of Investment Advisory Agreement | 112 |
| 2 |
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Domestic Equity
The U.S. equity market rose to multiyear or all-time highs during the fiscal year ended April 30, 2014.1 Corporate earnings were resilient in the face of modest economic growth, driven by strong profitability across many sectors, and fundamentals for corporations and consumers remained relatively stable following significant recovery in prior years.
However, the fiscal year began with capital markets in the U.S. declining. In May and June 2013, equity and fixed income markets fell following then-U.S. Federal Reserve (the “Fed”) Chairman Ben Bernanke’s comments suggesting that the time was approaching to reduce, or “taper,” the size of its bond buying economic stimulus program. This sell-off was brief but broad, and few asset classes were immune. Markets stabilized in mid-summer and generally rose, with some brief interruptions, through the end of 2013. The Fed’s announcement in December that tapering of its bond purchases would begin in early 2014 had little effect on equities as the announcement was widely anticipated. After strong performance in the second half of 2013, the U.S. equity market turned volatile in the first four months of 2014 as investors worried that stocks may have risen too high, too fast in 2013. Adding to this investor uncertainty during 2014 was political upheaval in Ukraine and signs of economic sluggishness in the U.S. and China.
1 | Source: Reuters |
| 3 |
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PWB | Manager’s Analysis | |
PowerShares Dynamic Large Cap Growth Portfolio (PWB) |
As an index fund, the PowerShares Dynamic Large Cap Growth Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Large Cap Growth IntellidexSM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of large capitalization companies that comprise the Index.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider selects 50 large capitalization U.S. growth stocks for inclusion in the Index principally on the basis of their capital appreciation potential. The Index Provider ranks the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ for investment potential using a proprietary model. The Index Provider segregates the universe of stocks into three size groups: large cap, mid cap and small cap. The Index Provider considers the 250 largest stocks to be large cap, it considers the next 750 stocks to be mid cap, and it considers the remaining 1,000 stocks to be small cap. The Index Provider divides large cap stocks into growth stocks and value stocks. The Index Provider bases a stock’s characterization as growth or value on a multi-factor methodology. The Index Provider then divides the large cap growth universe into two sub-groups based on market capitalization. The top quintile is one sub-group. The Index Provider includes 15 of the top-ranked relatively larger stocks in this sub-group, and they collectively receive 50% of the weight with each larger stock receiving approximately 3.3%. The bottom four quintiles are another sub-group. The Index Provider includes 35 of the top-ranked relatively smaller stocks in this sub-group, and they collectively receive 50% of the weight, with each smaller stock receiving approximately 1.4%. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 20.96%. On a net asset value (“NAV”) basis, the Fund returned 20.91%. During the same time period, the Index returned 21.66%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 1000® Growth Index (the “Benchmark Index”) returned 20.66%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 576 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a benchmark composed of large cap growth stocks. The Benchmark Index was selected for its
recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the large cap growth market. The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a modified equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the consumer discretionary sector and most underweight the consumer staples sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to stock selection within the health care sector and the Fund’s allocation to the consumer staples sector.
For the fiscal year ended April 30, 2014, the consumer discretionary sector contributed most significantly to the Fund’s return, followed by the information technology and health care sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Gilead Sciences, Inc., a health care company (portfolio average weight of 3.37%) and MasterCard, Inc., Class A, an information technology company (portfolio average weight of 3.41%). Positions that detracted most significantly from the Fund’s return included Netflix, Inc., a consumer discretionary company (portfolio average weight of 0.19%); and NIKE, Inc., Class B, a consumer discretionary company (portfolio average weight of 1.27%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Consumer Discretionary | 28.1 | |||
Financials | 15.7 | |||
Information Technology | 15.3 | |||
Industrials | 15.0 | |||
Health Care | 13.1 | |||
Energy | 8.6 | |||
Consumer Staples | 2.8 | |||
Materials | 1.4 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 4 |
|
PowerShares Dynamic Large Cap Growth Portfolio (PWB) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Berkshire Hathaway, Inc., Class B | 3.9 | |||
Schlumberger Ltd. | 3.8 | |||
Union Pacific Corp. | 3.7 | |||
United Parcel Service, Inc., Class B | 3.6 | |||
Honeywell International, Inc. | 3.4 | |||
Walt Disney Co. (The) | 3.4 | |||
Home Depot, Inc. (The) | 3.4 | |||
Gilead Sciences, Inc. | 3.3 | |||
MasterCard, Inc., Class A | 3.3 | |||
NIKE, Inc., Class B | 3.2 | |||
Total | 35.0 |
| 5 |
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PowerShares Dynamic Large Cap Growth Portfolio (PWB) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Large Cap Growth IntellidexSM Index | 21.66 | % | 14.92 | % | 51.77 | % | 20.10 | % | 149.88 | % | 7.43 | % | 92.76 | % | ||||||||||||||||
Russell 1000® Growth Index | 20.66 | 13.37 | 45.73 | 19.47 | 143.35 | 8.19 | 105.69 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 20.91 | 14.19 | 48.91 | 19.28 | 141.42 | 6.71 | 81.34 | |||||||||||||||||||||||
Market Price Return | 20.96 | 14.19 | 48.91 | 19.28 | 141.42 | 6.69 | 80.97 |
Fund Inception: March 3, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.59%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the
redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 6 |
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PWV | Manager’s Analysis | |
PowerShares Dynamic Large Cap Value Portfolio (PWV) |
As an index fund, the PowerShares Dynamic Large Cap Value Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Large Cap Value IntellidexSM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of large capitalization companies that comprise the Index.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider selects 50 large capitalization U.S. value stocks for inclusion in the Index principally on the basis of their capital appreciation potential. The Index Provider ranks the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ for investment potential using a proprietary model. The Index Provider segregates the universe of stocks into three size groups: large cap, mid cap and small cap. The Index Provider considers the 250 largest stocks to be large cap, it considers the next 750 stocks to be mid cap, and it considers the remaining 1,000 stocks to be small cap. The Index Provider divides large cap stocks into growth stocks and value stocks. The Index Provider bases a stock’s characterization as growth or value on a multi-factor methodology. The Index Provider then divides the large cap value universe into two sub-groups based on market capitalization. The top quintile is one sub-group. The Index Provider includes 15 of the top-ranked relatively larger stocks in this sub-group, and they collectively receive 50% of the weight with each larger stock receiving approximately 3.3%. The bottom four quintiles are another sub-group. The Index Provider includes 35 of the top-ranked relatively smaller stocks in this sub-group, and they collectively receive 50% of the weight, with each smaller stock receiving approximately 1.4%. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 19.35%. On a net asset value (“NAV”) basis, the Fund returned 19.48%. During the same time period, the Index returned 20.19%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 1000® Value Index (the “Benchmark Index”) returned 20.90%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 698 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a benchmark similarly composed of large cap value stocks. The Benchmark Index was
selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the large cap value market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a modified equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the information technology sector and most underweight the utilities sector during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to stock selection in the information technology sector and the Fund’s overweighting in the telecommunication services sector.
For the fiscal year ended April 30, 2014, the financials sector contributed most significantly to the Fund’s return, followed by the health care and industrials sectors, respectively. Telecommunication services was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Wells Fargo & Co., a financials company (portfolio average weight of 3.37%) and Lockheed Martin Corp., an industrials company (portfolio average weight of 1.48%). Positions that detracted most significantly from the Fund’s return included Verizon Communications Inc., a telecommunication services company (No longer held at fiscal year-end); and American Electric Power Co., Inc., an utilities company (No longer held at fiscal year-end).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 23.6 | |||
Information Technology | 21.4 | |||
Health Care | 18.0 | |||
Energy | 14.4 | |||
Consumer Staples | 6.4 | |||
Industrials | 5.6 | |||
Telecommunication Services | 3.5 | |||
Utilities | 3.0 | |||
Consumer Discretionary | 2.7 | |||
Materials | 1.4 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 7 |
|
PowerShares Dynamic Large Cap Value Portfolio (PWV) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Apple, Inc. | 3.6 | |||
AT&T, Inc. | 3.6 | |||
Johnson & Johnson | 3.5 | |||
Chevron Corp. | 3.5 | |||
Intel Corp. | 3.4 | |||
Wells Fargo & Co. | 3.4 | |||
Wal-Mart Stores, Inc. | 3.4 | |||
Exxon Mobil Corp. | 3.4 | |||
International Business Machines Corp. | 3.4 | |||
Cisco Systems, Inc. | 3.4 | |||
Total | 34.6 |
| 8 |
|
PowerShares Dynamic Large Cap Value Portfolio (PWV) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Large Cap Value IntellidexSM Index | 20.19 | % | 16.55 | % | 58.31 | % | 20.46 | % | 153.65 | % | 10.70 | % | 153.81 | % | ||||||||||||||||
Russell 1000® Value Index | 20.90 | 14.16 | 48.77 | 19.52 | 143.92 | 6.74 | 81.69 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 19.48 | 15.80 | 55.27 | 19.64 | 145.14 | 9.95 | 138.46 | |||||||||||||||||||||||
Market Price Return | 19.35 | 15.75 | 55.10 | 19.61 | 144.80 | 9.93 | 137.98 |
Fund Inception: March 3, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.59%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the
redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 9 |
|
PXLC | Manager’s Analysis | |
PowerShares Fundamental Pure Large Core Portfolio (PXLC) |
As an index fund, the PowerShares Fundamental Pure Large Core Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Large Core Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “large” and “core” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 21.72%. On a net asset value (“NAV”) basis, the Fund returned 21.69%. During the same time period, the Blended - RAFI® Fundamental Large Core Index returned 22.20%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 1000® Index (the “Benchmark Index”) returned 20.81%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,000 securities. The Fund provided this new comparative benchmark to replace the Russell Top 200® Index, the Fund’s previous benchmark index, because of its recognition in the market place and the fact that it is more representative of a large cap core style portfolio. The Fund provided this additional comparative benchmark to help
investors better understand how the investment results of the Fund compare to the performance of a large capitalization equity benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. large capitalization equity market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. Relative to the Benchmark Index, the Fund was overweight in the health care, financials and consumer staples sectors. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to these sector allocations and the stocks’ positive performance.
For the fiscal year ended April 30, 2014, the financials sector contributed most significantly to the Fund’s return, followed by the health care and industrials sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Wells Fargo & Co., a financials company (No longer held at fiscal year-end) and Johnson & Johnson, a health care company (portfolio average weight of 5.52%). Positions that detracted most significantly from the Fund’s return included Prudential Financial, Inc., a financials company (portfolio average weight of 0.16%); and U.S. Bancorp, a financials company (portfolio average weight of 0.20%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 16.9 | |||
Industrials | 16.6 | |||
Health Care | 15.2 | |||
Consumer Staples | 13.5 | |||
Consumer Discretionary | 13.2 | |||
Information Technology | 10.1 | |||
Energy | 6.3 | |||
Materials | 4.2 | |||
Utilities | 4.0 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 10 |
|
PowerShares Fundamental Pure Large Core Portfolio (PXLC) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Johnson & Johnson | 5.8 | |||
Berkshire Hathaway, Inc., Class B | 5.7 | |||
International Business Machines Corp. | 4.3 | |||
Intel Corp. | 4.1 | |||
PepsiCo, Inc. | 3.0 | |||
Philip Morris International, Inc. | 2.9 | |||
CVS Caremark Corp. | 2.4 | |||
Ford Motor Co. | 2.2 | |||
United Technologies Corp. | 2.2 | |||
Home Depot, Inc. (The) | 2.1 | |||
Total | 34.7 |
| 11 |
|
PowerShares Fundamental Pure Large Core Portfolio (PXLC) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
Index | 1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | ||||||||||||||||||||||||
Avg. Ann.††† | Cumulative | |||||||||||||||||||||||||||||
Blended - RAFI® Fundamental Large Core Index†† | 22.20 | % | 15.01 | % | 52.13 | % | 19.11 | % | 139.72 | % | 7.74 | % | 73.83 | % | ||||||||||||||||
Russell 1000® Index | 20.81 | 13.80 | 47.37 | 19.52 | 143.86 | 6.65 | 61.14 | |||||||||||||||||||||||
Russell Top 200® Index | 20.61 | 14.11 | 48.59 | 18.59 | 134.57 | 6.19 | 56.05 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 21.69 | 14.52 | 50.21 | 18.46 | 133.24 | 7.11 | 66.32 | |||||||||||||||||||||||
Market Price Return | 21.72 | 14.54 | 50.29 | 18.48 | 133.51 | 7.10 | 66.28 |
Fund Inception: December 1, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.80%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years” and “Fund Inception” performance for the RAFI® Fundamental Large Core Index is not available because that Index did not commence calculation and publication until April 15, 2011. The Blended - RAFI® Fundamental Large Core Index performance is comprised of the performance of the Dynamic Large Cap IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 16, 2011, followed by the performance of the Index starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 12 |
|
PXLG | Manager’s Analysis | |
PowerShares Fundamental Pure Large Growth Portfolio (PXLG) |
As an index fund, the PowerShares Fundamental Pure Large Growth Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Large Growth Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “large” and “growth” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 20.59%. On a net asset value (“NAV”) basis, the Fund returned 20.54%. During the same time period, the Index returned 21.06%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 1000® Growth Index (the “Benchmark Index”) returned 20.66%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,000 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar large cap growth benchmark. The Benchmark Index was selected for its recognition
in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. large capitalization equity growth market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the energy sector and most underweight in the consumer discretionary sector during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance (pre-expenses) relative to the Benchmark Index during the period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the information technology sector contributed most significantly to the Fund’s return, followed by the energy and health care sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Apple Inc. , an information technology company (portfolio average weight of 6.26%) and Microsoft Corp., an information technology company (portfolio average weight of 8.27%). Positions that detracted most significantly from the Fund’s return included Philip Morris International Inc., a consumer staples company (No longer held at fiscal year-end); and Annaly Capital Management, Inc., a financials company (No longer held at fiscal year-end).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Information Technology | 35.1 | |||
Health Care | 13.8 | |||
Energy | 11.9 | |||
Financials | 11.8 | |||
Consumer Discretionary | 10.9 | |||
Consumer Staples | 7.9 | |||
Industrials | 3.6 | |||
Materials | 3.0 | |||
Telecommunication Services | 1.9 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.1 |
| 13 |
|
PowerShares Fundamental Pure Large Growth Portfolio (PXLG) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Microsoft Corp. | 8.5 | |||
Wells Fargo & Co. | 8.2 | |||
Apple, Inc. | 7.6 | |||
Merck & Co., Inc. | 6.3 | |||
Coca-Cola Co. (The) | 5.1 | |||
Comcast Corp., Class A | 4.0 | |||
Cisco Systems, Inc. | 3.3 | |||
Schlumberger Ltd. | 3.3 | |||
Phillips 66 | 3.0 | |||
Oracle Corp. | 2.9 | |||
Total | 52.2 |
| 14 |
|
PowerShares Fundamental Pure Large Growth Portfolio (PXLG) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | Fund Inception† | |||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||
RAFI® Fundamental Large Growth Index | 21.06 | % | 17.60 | % | 59.35 | % | ||||||||
Russell 1000® Growth Index | 20.66 | 16.98 | 56.90 | |||||||||||
Fund | ||||||||||||||
NAV Return | 20.54 | 17.14 | 57.58 | |||||||||||
Market Price Return | 20.59 | 17.17 | 57.69 |
Fund Inception: June 16, 2011
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.79%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not
reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 15 |
|
PXLV | Manager’s Analysis | |
PowerShares Fundamental Pure Large Value Portfolio (PXLV) |
As an index fund, the PowerShares Fundamental Pure Large Value Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Large Value Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that compose the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “large” and “value” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 19.23%. On a net asset value (“NAV”) basis, the Fund returned 19.27%. During the same time period, the Index returned 19.64%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 1000® Value Index (the “Benchmark Index”) returned 20.90%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,000 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar large cap value benchmark. The Benchmark Index was selected for its recognition
in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. large cap value equity market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the telecommunication services sector and most underweight in the health care and information technology sectors during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocation weights.
For the fiscal year ended April 30, 2014, the financials sector contributed most significantly to the Fund’s return, followed by the industrials and energy sectors, respectively. Telecommunication services was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Bank of America Corp., a financials company (portfolio average weight of 6.03%) and Exxon Mobil Corp., an energy company (portfolio average weight of 8.09%). Positions that detracted most significantly from the Fund’s return included Verizon Communications Inc., a telecommunication services company (portfolio average weight of 3.67%); and FirstEnergy Corp., an utilities company (portfolio average weight of 0.47%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 23.3 | |||
Energy | 21.9 | |||
Consumer Staples | 12.3 | |||
Telecommunication Services | 9.3 | |||
Health Care | 8.3 | |||
Utilities | 7.8 | |||
Industrials | 7.3 | |||
Consumer Discretionary | 4.3 | |||
Materials | 3.0 | |||
Information Technology | 2.5 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 16 |
|
PowerShares Fundamental Pure Large Value Portfolio (PXLV) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Exxon Mobil Corp. | 8.8 | |||
Chevron Corp. | 6.0 | |||
AT&T, Inc. | 5.8 | |||
General Electric Co. | 5.1 | |||
JPMorgan Chase & Co. | 4.5 | |||
Bank of America Corp. | 4.2 | |||
Pfizer, Inc. | 3.6 | |||
Verizon Communications, Inc. | 3.4 | |||
Procter & Gamble Co. (The) | 3.2 | |||
Citigroup, Inc. | 3.2 | |||
Total | 47.8 |
| 17 |
|
PowerShares Fundamental Pure Large Value Portfolio (PXLV) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | Fund Inception† | |||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||
RAFI® Fundamental Large Value Index | 19.64 | % | 17.84 | % | 60.27 | % | ||||||||
Russell 1000® Value Index | 20.90 | 17.58 | 59.22 | |||||||||||
Fund | ||||||||||||||
NAV Return | 19.27 | 17.39 | 58.55 | |||||||||||
Market Price Return | 19.23 | 17.44 | 58.74 |
Fund Inception: June 16, 2011
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 2.18%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not
reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 18 |
|
PXMC | Manager’s Analysis | |
PowerShares Fundamental Pure Mid Core Portfolio (PXMC) |
As an index fund, the PowerShares Fundamental Pure Mid Core Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Mid Core Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “mid” and “core” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 20.73%. On a net asset value (“NAV”) basis, the Fund returned 20.85%. During the same time period, the Blended - RAFI® Fundamental Mid Core Index returned 21.34%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell Midcap® Index (the “Benchmark Index”) returned 21.25%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 800 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a broad based midcap benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful
measure for investors as a broad representation of the U.S. midcap equity market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the industrials sector and most underweight in the financials sector during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocation differences.
For the fiscal year ended April 30, 2014, the consumer discretionary sector contributed most significantly to the Fund’s return, followed by the industrials and information technology sectors, respectively. Energy was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Forest Laboratories, Inc., a health care company (portfolio average weight of 1.12%) and Goodyear Tire & Rubber Co., a consumer discretionary company (No longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Alpha Natural Resources, Inc., an energy company (No longer held at fiscal year-end); and Diamond Offshore Drilling, Inc., an energy company (No longer held at fiscal year-end).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 24.0 | |||
Industrials | 15.6 | |||
Consumer Discretionary | 14.5 | |||
Information Technology | 12.8 | |||
Health Care | 10.0 | |||
Materials | 6.6 | |||
Energy | 5.6 | |||
Utilities | 5.3 | |||
Consumer Staples | 4.8 | |||
Telecommunication Services | 0.8 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 19 |
|
PowerShares Fundamental Pure Mid Core Portfolio (PXMC) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
NRG Energy, Inc. | 1.6 | |||
Ameriprise Financial, Inc. | 1.5 | |||
Becton, Dickinson and Co. | 1.4 | |||
Vornado Realty Trust | 1.4 | |||
Northeast Utilities | 1.4 | |||
Parker Hannifin Corp. | 1.4 | |||
Equity Residential | 1.4 | |||
Fluor Corp. | 1.3 | |||
Charles Schwab Corp. (The) | 1.3 | |||
Republic Services, Inc. | 1.2 | |||
Total | 13.9 |
| 20 |
|
PowerShares Fundamental Pure Mid Core Portfolio (PXMC) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended - RAFI® Fundamental Mid Core Index†† | 21.34 | % | 12.12 | % | 40.93 | % | 19.40 | % | 142.70 | % | 6.65 | % | 61.14 | % | ||||||||||||||||
Russell Midcap® Index | 21.25 | 13.05 | 44.49 | 21.87 | 168.84 | 7.83 | 74.92 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 20.85 | 11.62 | 39.07 | 18.70 | 135.66 | 6.02 | 54.22 | |||||||||||||||||||||||
Market Price Return | 20.73 | 11.56 | 38.84 | 18.68 | 135.41 | 6.00 | 54.03 |
Fund Inception: December 1, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 1.00%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years” and “Fund Inception” performance for the RAFI® Fundamental Mid Core Index is not available because that Index did not commence calculation and publication until April 15, 2011. The Blended - RAFI® Fundamental Mid Core Index performance is comprised of the performance of the Dynamic Mid Cap IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 16, 2011, followed by the performance of the Index starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 21 |
|
PXMG | Manager’s Analysis | |
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) |
As an index fund, the PowerShares Fundamental Pure Mid Growth Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Mid Growth Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “mid” and “growth” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 16.77%. On a net asset value (“NAV”) basis, the Fund returned 16.80%. During the same time period, the Blended - RAFI® Fundamental Mid Growth Index returned 17.25%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell Midcap® Growth Index (the “Benchmark Index”) returned 20.62%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 506 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a midcap growth benchmark. The Benchmark Index was selected for its recognition
in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. midcap growth equity market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the financials sector and most underweight in the consumer discretionary sector during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the Fund being underweight in the consumer discretionary sector and the stocks’ underperformance in the financials sector.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the energy and information technology sectors, respectively. Financials was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Western Digital Corp., an information technology company (portfolio average weight of 2.37%) and Actavis PLC, a health care company (portfolio average weight of 1.51%). Positions that detracted most significantly from the Fund’s return included Mosaic Co., a materials company (No longer held at fiscal year-end); and HCP, Inc., a financials company (portfolio average weight of 1.67%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 23.6 | |||
Information Technology | 16.6 | |||
Energy | 14.6 | |||
Consumer Discretionary | 13.0 | |||
Industrials | 11.1 | |||
Health Care | 11.0 | |||
Materials | 5.5 | |||
Consumer Staples | 4.6 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) |
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PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
HCP, Inc. | 2.5 | |||
Western Digital Corp. | 2.3 | |||
Ventas, Inc. | 2.3 | |||
HollyFrontier Corp. | 2.3 | |||
Prologis, Inc. | 2.0 | |||
Stanley Black & Decker, Inc. | 1.9 | |||
Health Care REIT, Inc. | 1.9 | |||
Noble Energy, Inc. | 1.9 | |||
Stryker Corp. | 1.8 | |||
Cameron International Corp. | 1.7 | |||
Total | 20.6 |
| 23 |
|
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended - RAFI® Fundamental Mid Growth Index†† | 17.25 | % | 9.03 | % | 29.60 | % | 18.09 | % | 129.67 | % | 8.98 | % | 119.73 | % | ||||||||||||||||
Russell Midcap® Growth Index | 20.62 | 11.63 | 39.10 | 21.10 | 160.40 | 9.02 | 120.53 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 16.80 | 8.56 | 27.96 | 17.44 | 123.39 | 8.31 | 107.68 | |||||||||||||||||||||||
Market Price Return | 16.77 | 8.53 | 27.83 | 17.45 | 123.49 | 8.28 | 107.20 |
Fund Inception: March 3, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.54%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years” and “Fund Inception” performance for the RAFI® Fundamental Mid Growth Index is not available because that Index did not commence calculation and publication until April 15, 2011. The Blended - RAFI® Fundamental Mid Growth Index performance is comprised of the performance of the Dynamic Mid Cap Growth IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 16, 2011, followed by the performance of the Index starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 24 |
|
PXMV | Manager’s Analysis | |
PowerShares Fundamental Pure Mid Value Portfolio (PXMV) |
As an index fund, the PowerShares Fundamental Pure Mid Value Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Mid Value Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “mid” and “value” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 25.14%. On a net asset value (“NAV”) basis, the Fund returned 25.19%. During the same time period, the Blended - RAFI® Fundamental Mid Value Index returned 25.68%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell Midcap® Value Index (the “Benchmark Index”) returned 22.10%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 539 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a Midcap value benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure
for investors as a broad representation of the U.S. midcap value market.
The performance of the Fund differed from the Benchmark Index in part because the Fund employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the consumer discretionary sector and most underweight in the financials sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to the Fund’s overweight position in the consumer discretionary sector, as well as the performance of stocks in the consumer staples sector.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the financials and consumer discretionary sectors, respectively. Telecommunication services was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Rite Aid Corp., a consumer staples company (portfolio average weight of 1.02%) and Tyson Foods, Inc., Class A, a consumer staples company (portfolio average weight of 0.98%). Positions that detracted most significantly from the Fund’s return included NII Holdings, Inc., Class B, a telecommunication services company (No longer held at fiscal year-end); and J. C. Penney Co., Inc., a consumer discretionary company (portfolio average weight of 0.48%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 20.3 | |||
Consumer Discretionary | 18.7 | |||
Industrials | 15.9 | |||
Utilities | 9.5 | |||
Information Technology | 7.5 | |||
Consumer Staples | 7.2 | |||
Energy | 7.0 | |||
Materials | 7.0 | |||
Health Care | 4.6 | |||
Telecommunication Services | 2.3 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 25 |
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PowerShares Fundamental Pure Mid Value Portfolio (PXMV) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Rite Aid Corp. | 1.0 | |||
Tesoro Corp. | 1.0 | |||
Whirlpool Corp. | 1.0 | |||
Hertz Global Holdings, Inc. | 1.0 | |||
Frontier Communications Corp. | 1.0 | |||
J.C. Penney Co., Inc. | 1.0 | |||
Windstream Holdings, Inc. | 0.9 | |||
Tyson Foods, Inc., Class A | 0.9 | |||
M&T Bank Corp. | 0.9 | |||
L-3 Communications Holdings, Inc. | 0.9 | |||
Total | 9.6 |
| 26 |
|
PowerShares Fundamental Pure Mid Value Portfolio (PXMV) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended - RAFI® Fundamental Mid Value Index†† | 25.68 | % | 17.39 | % | 61.77 | % | 21.04 | % | 159.75 | % | 8.45 | % | 110.22 | % | ||||||||||||||||
Russell Midcap® Value Index | 22.10 | 14.41 | 49.76 | 22.61 | 177.09 | 9.11 | 122.16 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 25.19 | 16.88 | 59.65 | 20.28 | 151.73 | 7.73 | 97.82 | |||||||||||||||||||||||
Market Price Return | 25.14 | 16.86 | 59.58 | 20.34 | 152.34 | 7.71 | 97.51 |
Fund Inception: March 3, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.82%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years” and “Fund Inception” performance for the RAFI® Fundamental Mid Value Index is not available because that Index did not commence calculation and publication until April 15, 2011. The Blended - RAFI® Fundamental Mid Value Index performance is comprised of the performance of the Dynamic Mid Cap Value IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 16, 2011, followed by the performance of the Index starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 27 |
|
PXSC | Manager’s Analysis | |
PowerShares Fundamental Pure Small Core Portfolio (PXSC) |
As an index fund, the PowerShares Fundamental Pure Small Core Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Small Core Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “small” and “core” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 19.90%. On a net asset value (“NAV”) basis, the Fund returned 19.76%. During the same time period, the Blended - RAFI® Fundamental Small Core Index returned 20.32%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 2000® Index (the “Benchmark Index”) returned 20.50%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 2,000 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a broad-based small cap benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful
measure for investors as a broad representation of the U.S. small cap equity market.
The performance of the Fund differed from the Benchmark Index primarily due to fees and operating expenses that the Fund incurred during the period but also because the Fund tracks an index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the industrials sector and most underweight in the information technology sector during the fiscal year ended April 30, 2014. For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the information technology and consumer discretionary sectors, respectively. Utilities was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included GT Advanced Technologies Inc., an information technology company (No longer held at fiscal year-end) and TriQuint Semiconductor, Inc., an information technology company (portfolio average weight of 0.45%). Positions that detracted most significantly from the Fund’s return included Tower Group International Ltd., a financials company (No longer held at fiscal year-end); and Weight Watchers International, Inc., a consumer discretionary company (No longer held at fiscal year-end).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 21.3 | |||
Industrials | 20.5 | |||
Consumer Discretionary | 17.1 | |||
Information Technology | 11.6 | |||
Health Care | 8.9 | |||
Materials | 6.2 | |||
Energy | 5.8 | |||
Consumer Staples | 5.7 | |||
Utilities | 1.6 | |||
Telecommunication Services | 1.3 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
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|
PowerShares Fundamental Pure Small Core Portfolio (PXSC) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Southwest Airlines Co. | 0.7 | |||
Dresser-Rand Group, Inc. | 0.7 | |||
Symetra Financial Corp. | 0.7 | |||
Highwoods Properties, Inc. | 0.7 | |||
AptarGroup, Inc. | 0.7 | |||
Broadridge Financial Solutions, Inc. | 0.7 | |||
Aqua America, Inc. | 0.6 | |||
Susser Holdings Corp. | 0.6 | |||
United Natural Foods, Inc. | 0.6 | |||
IDEX Corp. | 0.6 | |||
Total | 6.6 |
| 29 |
|
PowerShares Fundamental Pure Small Core Portfolio (PXSC) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended - RAFI® Fundamental Small Core Index†† | 20.32 | % | 11.01 | % | 36.80 | % | 18.93 | % | 137.95 | % | 5.34 | % | 47.05 | % | ||||||||||||||||
Russell 2000® Index | 20.50 | 10.74 | 35.79 | 19.84 | 147.15 | 6.52 | 59.71 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 19.76 | 10.52 | 35.01 | 18.15 | 130.26 | 4.59 | 39.50 | |||||||||||||||||||||||
Market Price Return | 19.90 | 10.50 | 34.92 | 18.19 | 130.65 | 4.59 | 39.46 |
Fund Inception: December 1, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 1.22%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years” and “Fund Inception” performance for the RAFI® Fundamental Small Core Index is not available because that Index did not commence calculation and publication until April 15, 2011. The Blended - RAFI® Fundamental Small Core Index performance is comprised of the performance of the Dynamic Small Cap IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 16, 2011, followed by the performance of the Index starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 30 |
|
PXSG | Manager’s Analysis | |
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) |
As an index fund, the PowerShares Fundamental Pure Small Growth Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Small Growth Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “small” and “growth” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 22.38%. On a net asset value (“NAV”) basis, the Fund returned 22.31%. During the same time period, the Blended - RAFI® Fundamental Small Growth Index returned 22.79%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 2000® Growth Index (the “Benchmark Index”) returned 21.46%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,188 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a small cap growth
benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. small cap growth market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index select and weight stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the financials sector and most underweight in the health care sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to the Fund’s overweight position in the financials sector.
For the fiscal year ended April 30, 2014, the information technology sector contributed most significantly to the Fund’s return, followed by the health care and financials sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Keurig Green Mountain, Inc., a consumer staples company (No longer held at fiscal year-end) and Skyworks Solutions, Inc., an information technology company (portfolio average weight of 0.84%). Positions that detracted most significantly from the Fund’s return included Hatteras Financial Corp., a financials company (No longer held at fiscal year-end); and Coeur Mining, Inc., a materials company (No longer held at fiscal year-end).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 26.4 | |||
Information Technology | 21.8 | |||
Consumer Discretionary | 13.3 | |||
Industrials | 13.3 | |||
Health Care | 11.0 | |||
Energy | 6.3 | |||
Consumer Staples | 3.3 | |||
Materials | 3.2 | |||
Utilities | 1.1 | |||
Telecommunication Services | 0.2 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.1 |
| 31 |
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PowerShares Fundamental Pure Small Growth Portfolio (PXSG) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Skyworks Solutions, Inc. | 1.1 | |||
Two Harbors Investment Corp. | 1.0 | |||
Triumph Group, Inc. | 0.9 | |||
ITC Holdings Corp. | 0.9 | |||
Starwood Property Trust, Inc. | 0.9 | |||
Kirby Corp. | 0.9 | |||
Kilroy Realty Corp. | 0.9 | |||
Nuance Communications, Inc. | 0.9 | |||
Hancock Holding Co. | 0.9 | |||
ResMed, Inc. | 0.9 | |||
Total | 9.3 |
| 32 |
|
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended - RAFI® Fundamental Small Growth Index†† | 22.79 | % | 9.02 | % | 29.57 | % | 19.34 | % | 142.03 | % | 6.09 | % | 71.85 | % | ||||||||||||||||
Russell 2000® Growth Index | 21.46 | 10.33 | 34.29 | 20.50 | 154.04 | 8.49 | 110.92 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 22.31 | 8.53 | 27.84 | 18.50 | 133.64 | 5.42 | 62.20 | |||||||||||||||||||||||
Market Price Return | 22.38 | 8.48 | 27.66 | 18.51 | 133.76 | 5.39 | 61.81 |
Fund Inception: March 3, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.94%, including acquired fund fees and expenses of 0.02%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years” and “Fund Inception” performance for the RAFI® Fundamental Small Growth Index is not available because that Index did not commence calculation and publication until April 15, 2011. The Blended - RAFI® Fundamental Small Growth Index performance is comprised of the performance of the Dynamic Small Cap Growth IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 16, 2011, followed by the performance of the Index starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 33 |
|
PXSV | Manager’s Analysis | |
PowerShares Fundamental Pure Small Value Portfolio (PXSV) |
As an index fund, the PowerShares Fundamental Pure Small Value Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the RAFI® Fundamental Small Value Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the component securities that comprise the Index.
Research Affiliates, LLC (the “Index Provider”) compiles the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the common stocks for inclusion in the Index from a universe of the 2,500 largest U.S. companies based on fundamental weight. The use of the word “Fundamental” in the Fund’s name reflects the fact that, in identifying common stocks, the Index Provider uses fundamental measures of company size, rather than market capitalization (company share price multiplied by number of shares outstanding). The Index Provider uses the following fundamental measures to include common stocks in the Index: book value, cash flow, sales and dividends. The Index Provider calculates a composite fundamental weight for each common stock by equally weighting the above four fundamental measures. The Index Provider then ranks each common stock by its fundamental weight and, based on this ranking, divides the common stocks into three size groups: “large,” “mid” and “small.” The common stocks it ranks in the top 70% of the eligible universe by fundamental weight comprise the “large” size group, the next 20% comprise the “mid” size group, and the final 10% comprise the “small” size group. The Index Provider further divides the “large” size group into “growth,” “core” or “value” subsets based on fundamental measures. The Index is composed only of those common stocks that the Index Provider classifies as both “small” and “value” and weights them according to their composite fundamental weight. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 27.47%. On a net asset value (“NAV”) basis, the Fund returned 27.29%. During the same time period, the Blended - RAFI® Fundamental Small Value Index returned 27.59%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 2000® Value Index (the “Benchmark Index”) returned 19.61%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,400 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a small cap value benchmark. The Benchmark Index was selected for its recognition
in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. small cap value market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a fundamental weighting and stock selection methodology, whereas the Benchmark Index select and weight stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the consumer discretionary sector and most underweight in the financials sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to the Fund being overweight in the consumer discretionary and industrial sectors, as well as to the stocks that outperformed within these sectors.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the consumer discretionary and financials sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included SunEdison, Inc., an information technology company (portfolio average weight of 0.55%) and Zale Corp., a consumer discretionary company (portfolio average weight of 0.38%). Positions that detracted most significantly from the Fund’s return included Aeropostale, Inc., a consumer discretionary company (portfolio average weight of 0.19%); and RadioShack Corp., a consumer discretionary company (portfolio average weight of 0.02%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 23.9 | |||
Industrials | 18.8 | |||
Consumer Discretionary | 17.8 | |||
Information Technology | 12.0 | |||
Materials | 7.5 | |||
Utilities | 6.1 | |||
Energy | 5.7 | |||
Health Care | 3.6 | |||
Consumer Staples | 3.1 | |||
Telecommunication Services | 1.4 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.1 |
| 34 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Tutor Perini Corp. | 0.5 | |||
Dynegy, Inc. | 0.4 | |||
PNM Resources, Inc. | 0.4 | |||
GATX Corp. | 0.4 | |||
Group 1 Automotive, Inc. | 0.4 | |||
Piedmont Natural Gas Co., Inc. | 0.4 | |||
Dun & Bradstreet Corp. (The) | 0.4 | |||
PacWest Bancorp | 0.4 | |||
Cleco Corp. | 0.4 | |||
Covanta Holding Corp. | 0.4 | |||
Total | 4.1 |
| 35 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended - RAFI® Fundamental Small Value Index†† | 27.59 | % | 15.16 | % | 52.74 | % | 21.15 | % | 160.93 | % | 7.63 | % | 96.05 | % | ||||||||||||||||
Russell 2000® Value Index | 19.61 | 11.16 | 37.37 | 19.13 | 139.91 | 7.08 | 87.10 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 27.29 | 14.80 | 51.31 | 20.46 | 153.65 | 6.96 | 85.16 | |||||||||||||||||||||||
Market Price Return | 27.47 | 14.80 | 51.29 | 20.52 | 154.26 | 6.95 | 85.01 |
Fund Inception: March 3, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.70%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “5 Years” and “Fund Inception” performance for the RAFI® Fundamental Small Value Index is not available because that Index did not commence calculation and publication until April 15, 2011. The Blended - RAFI® Fundamental Small Value Index performance is comprised of the performance of the Dynamic Small Cap Value IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 16, 2011, followed by the performance of the Index starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 36 |
|
PZI | Manager’s Analysis | |
PowerShares Zacks Micro Cap Portfolio (PZI) |
As an index fund, the PowerShares Zacks Micro Cap Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Zacks Micro Cap IndexTM (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of micro capitalization companies that comprise the Index.
Zacks Investment Research (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider designs the selection methodology of the Index to identify companies with potentially superior risk-return profiles, as determined by the Index Provider. The objective of the Index is to actively represent a group of stocks that has the potential to outperform passive benchmark micro capitalization indices and other actively managed U.S. micro capitalization strategies. The Index constituent selection methodology utilizes a proprietary composite scoring system that measures companies on the basis of relative value and momentum, and is designed to be an effective, quantitative approach to selecting stocks with the greatest potential for capital appreciation from the micro capitalization subset of the domestic equity universe. The Index Provider selects U.S. stocks from a universe of 7,000 domestic companies. For the purpose of this constituent selection, the micro capitalization subset is defined relative to the entire investable universe of stocks, with the upper threshold equal to 0.15% of the capitalization of the largest capitalization domestic company at the time of selection and a minimum capitalization of approximately 0.015% of the largest capitalization domestic company at the time of selection. The Index Provider ranks and sorts each company from highest to lowest by each factor subset, then combines the rankings to establish a composite profile. A security may be an Index constituent only if it achieves a minimum threshold ranking on each factor. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 21.25%. On a net asset value (“NAV”) basis, the Fund returned 21.06%. During the same time period, the Index returned 20.44%. During the fiscal year, the Fund fully replicated the components of the Index. However, the Index does not take dividends into consideration when determining its total return, which is the primary cause of the Fund’s outperformance compared to the Index.
During this same time period, the Russell Microcap® Index (the “Benchmark Index”) returned 25.50%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,515 securities. The Fund selected this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a micro-cap U.S. stock
benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a representation of the micro-cap segment of the U.S. market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a proprietary stock selection methodology that differs from the stock selection methodology of the Benchmark Index.
Relative to the Benchmark Index, the Fund was most overweight in the financials sector and most underweight in the health care sector during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the Fund’s concentration of stocks in the industrials sector, as well as its allocation to the health care sector and the performance of stocks in that sector.
For the fiscal year ended April 30, 2014, the financials sector contributed most significantly to the Fund’s return, followed by the consumer discretionary and industrials sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Canadian Solar Inc., an information technology company (No longer held at fiscal year-end) and Zale Corp., a consumer discretionary company (No longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Uni-Pixel, Inc., an information technology company (No longer held at fiscal year-end); and L & L Energy, Inc., an energy company (No longer held at fiscal year-end).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Financials | 28.3 | |||
Industrials | 16.1 | |||
Information Technology | 15.6 | |||
Consumer Discretionary | 14.4 | |||
Energy | 9.4 | |||
Health Care | 8.9 | |||
Consumer Staples | 2.8 | |||
Materials | 2.3 | |||
Telecommunication Services | 1.4 | |||
Utilities | 0.7 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.1 |
| 37 |
|
PowerShares Zacks Micro Cap Portfolio (PZI) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Providence Service Corp. (The) | 0.4 | |||
Alliance Fiber Optic Products, Inc. | 0.3 | |||
China XD Plastics Co. Ltd. | 0.3 | |||
Advantage Oil & Gas Ltd. | 0.3 | |||
P.A.M. Transportation Services, Inc. | 0.3 | |||
Adams Resources & Energy, Inc. | 0.3 | |||
Repligen Corp. | 0.3 | |||
Hill International, Inc. | 0.3 | |||
Fuel Tech, Inc. | 0.3 | |||
Gastar Exploration, Inc. | 0.3 | |||
Total | 3.1 |
| 38 |
|
PowerShares Zacks Micro Cap Portfolio (PZI) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Zacks Micro Cap IndexTM | 20.44 | % | 9.68 | % | 31.94 | % | 15.49 | % | 105.50 | % | 1.42 | % | 13.05 | % | ||||||||||||||||
Russell Microcap® Index | 25.50 | 12.27 | 41.51 | 20.71 | 156.31 | 6.26 | 69.66 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 21.06 | 10.61 | 35.32 | 16.28 | 112.57 | 2.04 | 19.19 | |||||||||||||||||||||||
Market Price Return | 21.25 | 10.62 | 35.35 | 16.26 | 112.44 | 2.02 | 18.95 |
Fund Inception: August 18, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 1.21%, including acquired fund fees and expenses of 0.23%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect
the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 39 |
|
Schedule of Investments(a)
PowerShares Dynamic Large Cap Growth Portfolio (PWB)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—28.1% | ||||||||
7,895 | AutoZone, Inc.(b) | $ | 4,215,062 | |||||
63,398 | CBS Corp., Class B | 3,661,869 | ||||||
72,278 | DISH Network Corp., Class A(b) | 4,109,727 | ||||||
70,996 | Dollar General Corp.(b) | 4,007,014 | ||||||
190,187 | Hilton Worldwide Holdings, Inc.(b) | 4,151,782 | ||||||
120,969 | Home Depot, Inc. (The) | 9,618,245 | ||||||
49,890 | Las Vegas Sands Corp. | 3,947,796 | ||||||
85,006 | Lowe’s Cos., Inc. | 3,902,625 | ||||||
43,378 | Michael Kors Holdings Ltd.(b) | 3,956,074 | ||||||
9,545 | Netflix, Inc.(b) | 3,073,872 | ||||||
126,732 | NIKE, Inc., Class B | 9,245,099 | ||||||
7,357 | Priceline Group, Inc. (The)(b) | 8,517,567 | ||||||
72,582 | VF Corp. | 4,434,034 | ||||||
122,793 | Walt Disney Co. (The) | 9,742,397 | ||||||
17,542 | Wynn Resorts Ltd. | 3,576,638 | ||||||
|
| |||||||
80,159,801 | ||||||||
|
| |||||||
Consumer Staples—2.8% | ||||||||
36,409 | Costco Wholesale Corp. | 4,211,793 | ||||||
40,188 | Hershey Co. (The) | 3,867,693 | ||||||
|
| |||||||
8,079,486 | ||||||||
|
| |||||||
Energy—8.6% | ||||||||
97,432 | Energy Transfer Equity LP | 4,539,357 | ||||||
44,916 | EOG Resources, Inc. | 4,401,768 | ||||||
74,607 | Halliburton Co. | 4,705,464 | ||||||
106,699 | Schlumberger Ltd. | 10,835,283 | ||||||
|
| |||||||
24,481,872 | ||||||||
|
| |||||||
Financials—15.7% | ||||||||
600,303 | Bank of America Corp. | 9,088,587 | ||||||
85,706 | Berkshire Hathaway, Inc., Class B(b) | 11,043,218 | ||||||
127,510 | Blackstone Group LP (The) | 3,765,370 | ||||||
160,423 | Charles Schwab Corp. (The) | 4,259,231 | ||||||
88,308 | Marsh & McLennan Cos., Inc. | 4,354,468 | ||||||
53,385 | McGraw-Hill Financial, Inc. | 3,946,753 | ||||||
138,079 | Morgan Stanley | 4,270,783 | ||||||
127,214 | TD Ameritrade Holding Corp. | 4,058,127 | ||||||
|
| |||||||
44,786,537 | ||||||||
|
| |||||||
Health Care—13.1% | ||||||||
19,256 | Actavis PLC(b) | 3,934,579 | ||||||
24,057 | Alexion Pharmaceuticals, Inc.(b) | 3,805,817 | ||||||
29,132 | Biogen Idec, Inc.(b) | 8,364,380 | ||||||
26,459 | Celgene Corp.(b) | 3,889,738 | ||||||
119,858 | Gilead Sciences, Inc.(b) | 9,407,654 | ||||||
24,023 | McKesson Corp. | 4,064,451 | ||||||
34,147 | Thermo Fisher Scientific, Inc. | 3,892,758 | ||||||
|
| |||||||
37,359,377 | ||||||||
|
| |||||||
Industrials—15.0% | ||||||||
55,598 | Danaher Corp. | 4,079,781 | ||||||
105,075 | Honeywell International, Inc. | 9,761,467 | ||||||
16,493 | Precision Castparts Corp. | 4,174,213 | ||||||
100,825 | Tyco International Ltd. | 4,123,743 | ||||||
55,017 | Union Pacific Corp. | 10,476,887 | ||||||
103,611 | United Parcel Service, Inc., Class B | 10,205,684 | ||||||
|
| |||||||
42,821,775 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology—15.3% | ||||||||
54,676 | Automatic Data Processing, Inc. | $ | 4,262,541 | |||||
8,166 | Google, Inc., Class A(b) | 4,367,830 | ||||||
8,166 | Google, Inc., Class C(b) | 4,300,706 | ||||||
127,677 | MasterCard, Inc., Class A | 9,390,643 | ||||||
72,595 | TE Connectivity Ltd. (Switzerland) | 4,281,653 | ||||||
94,591 | Texas Instruments, Inc. | 4,299,161 | ||||||
43,921 | Visa, Inc., Class A | 8,898,834 | ||||||
109,978 | Yahoo!, Inc.(b) | 3,953,709 | ||||||
|
| |||||||
43,755,077 | ||||||||
|
| |||||||
Materials—1.4% | ||||||||
21,495 | PPG Industries, Inc. | 4,161,862 | ||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $262,240,732) | 285,605,787 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
134,194 | Invesco Premier Portfolio—Institutional Class(c) (Cost $134,194) | 134,194 | ||||||
|
| |||||||
Total Investments (Cost $262,374,926)—100.0% | 285,739,981 | |||||||
Other assets less liabilities—(0.0)% | (65,423 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 285,674,558 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 40 |
|
Schedule of Investments(a)
PowerShares Dynamic Large Cap Value Portfolio (PWV)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Consumer Discretionary—2.7% | ||||||||
140,767 | DIRECTV(b) | $ | 10,923,519 | |||||
188,789 | Macy’s, Inc. | 10,842,152 | ||||||
|
| |||||||
21,765,671 | ||||||||
|
| |||||||
Consumer Staples—6.4% | ||||||||
269,051 | Archer-Daniels-Midland Co. | 11,765,600 | ||||||
260,456 | Kroger Co. (The) | 11,991,394 | ||||||
341,202 | Wal-Mart Stores, Inc. | 27,197,212 | ||||||
|
| |||||||
50,954,206 | ||||||||
|
| |||||||
Energy—14.4% | ||||||||
220,998 | Chevron Corp. | 27,739,669 | ||||||
164,261 | ConocoPhillips | 12,206,235 | ||||||
264,757 | Exxon Mobil Corp. | 27,113,764 | ||||||
130,039 | Marathon Petroleum Corp. | 12,087,125 | ||||||
113,174 | Occidental Petroleum Corp. | 10,836,411 | ||||||
145,916 | Phillips 66 | 12,143,130 | ||||||
227,661 | Valero Energy Corp. | 13,015,379 | ||||||
|
| |||||||
115,141,713 | ||||||||
|
| |||||||
Financials—23.6% | ||||||||
111,609 | ACE Ltd. | 11,419,833 | ||||||
170,462 | Aflac, Inc. | 10,691,377 | ||||||
201,314 | Allstate Corp. (The) | 11,464,832 | ||||||
219,476 | American International Group, Inc. | 11,660,760 | ||||||
124,869 | Chubb Corp. (The) | 11,497,938 | ||||||
524,119 | Citigroup, Inc. | 25,110,541 | ||||||
190,371 | Discover Financial Services | 10,641,739 | ||||||
503,501 | Fifth Third Bancorp | 10,377,156 | ||||||
448,578 | JPMorgan Chase & Co. | 25,111,396 | ||||||
215,577 | MetLife, Inc. | 11,285,456 | ||||||
129,146 | Prudential Financial, Inc. | 10,419,499 | ||||||
130,286 | Travelers Cos., Inc. (The) | 11,801,306 | ||||||
549,071 | Wells Fargo & Co. | 27,255,884 | ||||||
|
| |||||||
188,737,717 | ||||||||
|
| |||||||
Health Care—18.0% | ||||||||
94,804 | Becton, Dickinson and Co. | 10,715,696 | ||||||
152,713 | Cardinal Health, Inc. | 10,615,081 | ||||||
137,243 | Cigna Corp. | 10,984,930 | ||||||
145,047 | Express Scripts Holding Co.(b) | 9,657,229 | ||||||
213,345 | HCA Holdings, Inc.(b) | 11,093,940 | ||||||
276,686 | Johnson & Johnson | 28,025,525 | ||||||
447,236 | Merck & Co., Inc. | 26,190,140 | ||||||
793,770 | Pfizer, Inc. | 24,829,125 | ||||||
120,582 | WellPoint, Inc. | 12,140,196 | ||||||
|
| |||||||
144,251,862 | ||||||||
|
| |||||||
Industrials—5.6% | ||||||||
328,924 | Delta Air Lines, Inc. | 12,114,271 | ||||||
67,306 | Lockheed Martin Corp. | 11,047,607 | ||||||
90,256 | Northrop Grumman Corp. | 10,967,006 | ||||||
111,567 | Raytheon Co. | 10,652,417 | ||||||
|
| |||||||
44,781,301 | ||||||||
|
| |||||||
Information Technology—21.4% | ||||||||
564,520 | Activision Blizzard, Inc. | 11,296,045 | ||||||
48,435 | Apple, Inc. | 28,581,009 | ||||||
1,169,173 | Cisco Systems, Inc. | 27,019,588 | ||||||
365,575 | Hewlett-Packard Co. | 12,085,910 |
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Information Technology (continued) | ||||||||
1,029,398 | Intel Corp. | $ | 27,474,633 | |||||
137,645 | International Business Machines Corp. | 27,043,113 | ||||||
651,700 | Oracle Corp. | 26,641,496 | ||||||
125,572 | Western Digital Corp. | 11,066,660 | ||||||
|
| |||||||
171,208,454 | ||||||||
|
| |||||||
Materials—1.4% | ||||||||
124,018 | LyondellBasell Industries NV, Class A | 11,471,665 | ||||||
|
| |||||||
Telecommunication Services—3.5% | ||||||||
798,244 | AT&T, Inc. | 28,497,311 | ||||||
|
| |||||||
Utilities—3.0% | ||||||||
119,527 | NextEra Energy, Inc. | 11,934,771 | ||||||
297,969 | Public Service Enterprise Group, Inc. | 12,207,790 | ||||||
|
| |||||||
24,142,561 | ||||||||
|
| |||||||
Total Common Stocks (Cost $689,070,060) | 800,952,461 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
78,211 | Invesco Premier Portfolio—Institutional Class(c) (Cost $78,211) | 78,211 | ||||||
|
| |||||||
Total Investments (Cost $689,148,271)—100.0% | 801,030,672 | |||||||
Other assets less liabilities—0.0% | 57,231 | |||||||
|
| |||||||
Net Assets—100.0% | $ | 801,087,903 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 41 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Large Core Portfolio (PXLC)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—13.2% | ||||||||
3,277 | CBS Corp., Class B | $ | 189,279 | |||||
4,231 | DIRECTV(b) | 328,326 | ||||||
56,047 | Ford Motor Co. | 905,159 | ||||||
24,748 | General Motors Co. | 853,311 | ||||||
10,981 | Home Depot, Inc. (The) | 873,099 | ||||||
6,845 | Johnson Controls, Inc. | 308,983 | ||||||
3,540 | L Brands, Inc. | 191,868 | ||||||
8,583 | McDonald’s Corp. | 870,145 | ||||||
2,218 | Omnicom Group, Inc. | 150,114 | ||||||
2,436 | Time Warner Cable, Inc. | 344,597 | ||||||
12,070 | Twenty-First Century Fox, Inc., Class A | 386,481 | ||||||
|
| |||||||
5,401,362 | ||||||||
|
| |||||||
Consumer Staples—13.5% | ||||||||
13,504 | Archer-Daniels-Midland Co. | 590,530 | ||||||
5,687 | Colgate-Palmolive Co. | 382,735 | ||||||
13,244 | CVS Caremark Corp. | 963,104 | ||||||
6,234 | General Mills, Inc. | 330,527 | ||||||
3,850 | Lorillard, Inc. | 228,767 | ||||||
14,406 | PepsiCo, Inc. | 1,237,331 | ||||||
14,030 | Philip Morris International, Inc. | 1,198,583 | ||||||
8,409 | Walgreen Co. | 570,971 | ||||||
|
| |||||||
5,502,548 | ||||||||
|
| |||||||
Energy—6.3% | ||||||||
4,205 | Anadarko Petroleum Corp. | 416,379 | ||||||
5,277 | Apache Corp. | 458,044 | ||||||
4,346 | Marathon Petroleum Corp. | 403,961 | ||||||
8,354 | Occidental Petroleum Corp. | 799,896 | ||||||
6,633 | Spectra Energy Corp. | 263,396 | ||||||
5,096 | Williams Cos., Inc. (The) | 214,898 | ||||||
|
| |||||||
2,556,574 | ||||||||
|
| |||||||
Financials—16.9% | ||||||||
3,618 | ACE Ltd. | 370,194 | ||||||
5,442 | Aflac, Inc. | 341,322 | ||||||
6,912 | American Express Co. | 604,316 | ||||||
29,181 | Annaly Capital Management, Inc. REIT | 337,041 | ||||||
18,166 | Berkshire Hathaway, Inc., Class B(b) | 2,340,689 | ||||||
7,783 | Capital One Financial Corp. | 575,164 | ||||||
4,163 | Marsh & McLennan Cos., Inc. | 205,277 | ||||||
6,484 | PNC Financial Services Group, Inc. (The) | 544,915 | ||||||
7,073 | Prudential Financial, Inc. | 570,650 | ||||||
3,914 | State Street Corp. | 252,688 | ||||||
17,866 | U.S. Bancorp | 728,575 | ||||||
|
| |||||||
6,870,831 | ||||||||
|
| |||||||
Health Care—15.2% | ||||||||
6,091 | AbbVie, Inc. | 317,219 | ||||||
4,291 | Aetna, Inc. | 306,592 | ||||||
5,263 | AmerisourceBergen Corp. | 343,043 | ||||||
4,280 | Baxter International, Inc. | 311,541 | ||||||
12,913 | Bristol-Myers Squibb Co. | 646,812 | ||||||
23,131 | Johnson & Johnson | 2,342,939 | ||||||
3,337 | McKesson Corp. | 564,587 | ||||||
8,540 | Medtronic, Inc. | 502,323 | ||||||
11,321 | UnitedHealth Group, Inc. | 849,528 | ||||||
|
| |||||||
6,184,584 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials—16.6% | ||||||||
4,891 | 3M Co. | $ | 680,289 | |||||
5,194 | Boeing Co. (The) | 670,130 | ||||||
7,079 | Caterpillar, Inc. | 746,126 | ||||||
9,669 | CSX Corp. | 272,859 | ||||||
4,076 | Deere & Co. | 380,454 | ||||||
6,957 | Emerson Electric Co. | 474,328 | ||||||
2,847 | FedEx Corp. | 387,904 | ||||||
5,183 | Honeywell International, Inc. | 481,501 | ||||||
3,804 | Illinois Tool Works, Inc. | 324,215 | ||||||
2,512 | Lockheed Martin Corp. | 412,320 | ||||||
3,071 | Norfolk Southern Corp. | 290,302 | ||||||
3,042 | PACCAR, Inc. | 194,627 | ||||||
5,798 | United Parcel Service, Inc., Class B | 571,103 | ||||||
7,513 | United Technologies Corp. | 889,013 | ||||||
|
| |||||||
6,775,171 | ||||||||
|
| |||||||
Information Technology—10.1% | ||||||||
63,254 | Intel Corp. | 1,688,249 | ||||||
8,900 | International Business Machines Corp. | 1,748,583 | ||||||
6,619 | Micron Technology, Inc.(b) | 172,888 | ||||||
7,409 | Texas Instruments, Inc. | 336,739 | ||||||
4,784 | Yahoo!, Inc.(b) | 171,985 | ||||||
|
| |||||||
4,118,444 | ||||||||
|
| |||||||
Materials—4.2% | ||||||||
1,754 | Air Products & Chemicals, Inc. | 206,130 | ||||||
8,504 | E.I. du Pont de Nemours & Co. | 572,489 | ||||||
4,000 | Mosaic Co. (The) | 200,160 | ||||||
11,602 | Newmont Mining Corp. | 288,078 | ||||||
960 | PPG Industries, Inc. | 185,875 | ||||||
1,932 | Praxair, Inc. | 252,223 | ||||||
|
| |||||||
1,704,955 | ||||||||
|
| |||||||
Utilities—4.0% | ||||||||
12,654 | AES Corp. (The) | 182,850 | ||||||
9,367 | Duke Energy Corp. | 697,748 | ||||||
4,552 | NextEra Energy, Inc. | 454,517 | ||||||
9,043 | PPL Corp. | 301,494 | ||||||
|
| |||||||
1,636,609 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $34,991,806) | 40,751,078 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
40,900 | Invesco Premier Portfolio—Institutional Class(c) (Cost $40,900) | 40,900 | ||||||
|
| |||||||
Total Investments (Cost $35,032,706)—100.1% | 40,791,978 | |||||||
Other assets less liabilities—(0.1)% | (21,582 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 40,770,396 | ||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 42 |
|
PowerShares Fundamental Pure Large Core Portfolio (PXLC) (continued)
April 30, 2014
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 43 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Large Growth Portfolio (PXLG)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—99.9% | ||||||||
Consumer Discretionary—10.9% | ||||||||
3,134 | Amazon.com, Inc.(b) | $ | 953,144 | |||||
81,752 | Comcast Corp., Class A | 4,231,484 | ||||||
14,540 | NIKE, Inc., Class B | 1,060,693 | ||||||
14,300 | TJX Cos., Inc. (The) | 831,974 | ||||||
9,802 | Viacom, Inc., Class B | 832,974 | ||||||
35,630 | Walt Disney Co. (The) | 2,826,884 | ||||||
11,067 | Yum! Brands, Inc. | 852,048 | ||||||
|
| |||||||
11,589,201 | ||||||||
|
| |||||||
Consumer Staples—7.9% | ||||||||
132,194 | Coca-Cola Co. (The) | 5,392,193 | ||||||
19,186 | Costco Wholesale Corp. | 2,219,436 | ||||||
14,160 | Kraft Foods Group, Inc. | 805,138 | ||||||
|
| |||||||
8,416,767 | ||||||||
|
| |||||||
Energy—11.9% | ||||||||
18,600 | Baker Hughes, Inc. | 1,300,140 | ||||||
10,340 | EOG Resources, Inc. | 1,013,320 | ||||||
25,316 | Halliburton Co. | 1,596,680 | ||||||
24,176 | Kinder Morgan, Inc. | 789,588 | ||||||
16,426 | National Oilwell Varco, Inc. | 1,289,934 | ||||||
38,152 | Phillips 66 | 3,175,009 | ||||||
34,632 | Schlumberger Ltd. | 3,516,880 | ||||||
|
| |||||||
12,681,551 | ||||||||
|
| |||||||
Financials—11.8% | ||||||||
3,310 | BlackRock, Inc. | 996,310 | ||||||
14,372 | CME Group, Inc. | 1,011,645 | ||||||
14,111 | Discover Financial Services | 788,805 | ||||||
6,090 | Simon Property Group, Inc. REIT | 1,054,788 | ||||||
174,735 | Wells Fargo & Co. | 8,673,845 | ||||||
|
| |||||||
12,525,393 | ||||||||
|
| |||||||
Health Care—13.8% | ||||||||
12,961 | Amgen, Inc. | 1,448,392 | ||||||
10,682 | Cigna Corp. | 854,987 | ||||||
13,882 | Covidien PLC | 989,093 | ||||||
28,306 | Express Scripts Holding Co.(b) | 1,884,613 | ||||||
11,885 | Gilead Sciences, Inc.(b) | 932,854 | ||||||
10,082 | Humana, Inc. | 1,106,500 | ||||||
114,399 | Merck & Co., Inc. | 6,699,205 | ||||||
6,702 | Thermo Fisher Scientific, Inc. | 764,028 | ||||||
|
| |||||||
14,679,672 | ||||||||
|
| |||||||
Industrials—3.6% | ||||||||
5,059 | Cummins, Inc. | 763,150 | ||||||
11,854 | Danaher Corp. | 869,847 | ||||||
11,250 | Union Pacific Corp. | 2,142,337 | ||||||
|
| |||||||
3,775,334 | ||||||||
|
| |||||||
Information Technology—35.1% | ||||||||
15,302 | Accenture PLC, Class A | 1,227,526 | ||||||
13,725 | Apple, Inc. | 8,098,985 | ||||||
12,562 | Automatic Data Processing, Inc. | 979,333 | ||||||
153,054 | Cisco Systems, Inc. | 3,537,078 | ||||||
59,803 | Corning, Inc. | 1,250,481 | ||||||
22,681 | eBay, Inc.(b) | 1,175,556 | ||||||
66,303 | EMC Corp. | 1,710,617 | ||||||
3,286 | Google, Inc., Class A(b) | 1,757,616 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
3,286 | Google, Inc., Class C(b) | $ | 1,730,605 | |||||
224,524 | Microsoft Corp. | 9,070,770 | ||||||
76,427 | Oracle Corp. | 3,124,336 | ||||||
32,555 | QUALCOMM, Inc. | 2,562,404 | ||||||
5,360 | Visa, Inc., Class A | 1,085,990 | ||||||
|
| |||||||
37,311,297 | ||||||||
|
| |||||||
Materials—3.0% | ||||||||
21,381 | LyondellBasell Industries NV, Class A | 1,977,743 | ||||||
11,420 | Monsanto Co. | 1,264,194 | ||||||
|
| |||||||
3,241,937 | ||||||||
|
| |||||||
Telecommunication Services—1.9% | ||||||||
57,721 | CenturyLink, Inc. | 2,015,040 | ||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $89,766,423) | 106,236,192 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
122,837 | Invesco Premier Portfolio—Institutional Class(c) (Cost $122,837) | 122,837 | ||||||
|
| |||||||
Total Investments (Cost $89,889,260)—100.0% | 106,359,029 | |||||||
Other assets less liabilities—(0.0)% | (37,305 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 106,321,724 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 44 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Large Value Portfolio (PXLV)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—4.3% | ||||||||
2,265 | Best Buy Co., Inc. | $ | 58,731 | |||||
1,266 | Carnival Corp. | 49,766 | ||||||
711 | Kohl’s Corp. | 38,956 | ||||||
2,311 | Lowe’s Cos., Inc. | 106,098 | ||||||
979 | Macy’s, Inc. | 56,224 | ||||||
3,709 | Staples, Inc. | 46,363 | ||||||
2,491 | Target Corp. | 153,819 | ||||||
1,888 | Time Warner, Inc. | 125,477 | ||||||
|
| |||||||
635,434 | ||||||||
|
| |||||||
Consumer Staples—12.3% | ||||||||
4,808 | Altria Group, Inc. | 192,849 | ||||||
845 | Bunge Ltd. | 67,304 | ||||||
1,369 | ConAgra Foods, Inc. | 41,768 | ||||||
774 | Kellogg Co. | 51,727 | ||||||
739 | Kimberly-Clark Corp. | 82,953 | ||||||
2,649 | Kroger Co. (The) | 121,960 | ||||||
5,282 | Mondelez International, Inc., Class A | 188,303 | ||||||
5,665 | Procter & Gamble Co. (The) | 467,646 | ||||||
840 | Reynolds American, Inc. | 47,401 | ||||||
1,705 | Safeway, Inc. | 58,072 | ||||||
2,013 | Sysco Corp. | 73,334 | ||||||
5,168 | Wal-Mart Stores, Inc. | 411,941 | ||||||
|
| |||||||
1,805,258 | ||||||||
|
| |||||||
Energy—21.9% | ||||||||
1,916 | Chesapeake Energy Corp. | 55,085 | ||||||
7,065 | Chevron Corp. | 886,799 | ||||||
6,131 | ConocoPhillips | 455,595 | ||||||
1,122 | Devon Energy Corp. | 78,540 | ||||||
12,657 | Exxon Mobil Corp. | 1,296,203 | ||||||
1,054 | Hess Corp. | 93,975 | ||||||
3,308 | Marathon Oil Corp. | 119,584 | ||||||
957 | Murphy Oil Corp. | 60,702 | ||||||
2,864 | Valero Energy Corp. | 163,735 | ||||||
|
| |||||||
3,210,218 | ||||||||
|
| |||||||
Financials—23.3% | ||||||||
1,480 | Allstate Corp. (The) | 84,286 | ||||||
4,052 | American International Group, Inc. | 215,283 | ||||||
41,192 | Bank of America Corp. | 623,647 | ||||||
3,206 | Bank of New York Mellon Corp. (The) | 108,587 | ||||||
2,037 | BB&T Corp. | 76,041 | ||||||
726 | Chubb Corp. (The) | 66,850 | ||||||
9,752 | Citigroup, Inc. | 467,218 | ||||||
2,185 | Fifth Third Bancorp | 45,033 | ||||||
2,382 | Genworth Financial, Inc., Class A(b) | 42,519 | ||||||
1,211 | Goldman Sachs Group, Inc. (The) | 193,542 | ||||||
2,055 | Hartford Financial Services Group, Inc. (The) | 73,713 | ||||||
11,898 | JPMorgan Chase & Co. | 666,050 | ||||||
2,732 | KeyCorp | 37,264 | ||||||
769 | Lincoln National Corp. | 37,304 | ||||||
1,087 | Loews Corp. | 47,795 | ||||||
2,808 | MetLife, Inc. | 146,999 | ||||||
3,959 | Morgan Stanley | 122,452 | ||||||
1,654 | Progressive Corp. (The) | 40,109 | ||||||
4,448 | Regions Financial Corp. | 45,103 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
1,742 | SunTrust Banks, Inc. | $ | 66,649 | |||||
1,471 | Travelers Cos., Inc. (The) | 133,243 | ||||||
2,850 | Weyerhaeuser Co. REIT | 85,073 | ||||||
|
| |||||||
3,424,760 | ||||||||
|
| |||||||
Health Care—8.3% | ||||||||
5,211 | Abbott Laboratories | 201,874 | ||||||
1,581 | Cardinal Health, Inc. | 109,895 | ||||||
2,481 | Eli Lilly & Co. | 146,627 | ||||||
2,028 | HCA Holdings, Inc.(b) | 105,456 | ||||||
16,774 | Pfizer, Inc. | 524,691 | ||||||
1,356 | WellPoint, Inc. | 136,522 | ||||||
|
| |||||||
1,225,065 | ||||||||
|
| |||||||
Industrials—7.3% | ||||||||
751 | General Dynamics Corp. | 82,197 | ||||||
27,700 | General Electric Co. | 744,853 | ||||||
623 | Northrop Grumman Corp. | 75,700 | ||||||
710 | Raytheon Co. | 67,791 | ||||||
1,098 | Tyco International Ltd. | 44,908 | ||||||
1,362 | Waste Management, Inc. | 60,541 | ||||||
|
| |||||||
1,075,990 | ||||||||
|
| |||||||
Information Technology—2.5% | ||||||||
2,007 | Applied Materials, Inc. | 38,254 | ||||||
280 | Blackhawk Network Holdings, Inc., Class B(b) | 6,448 | ||||||
8,163 | Hewlett-Packard Co. | 269,869 | ||||||
4,647 | Xerox Corp. | 56,182 | ||||||
|
| |||||||
370,753 | ||||||||
|
| |||||||
Materials—3.0% | ||||||||
5,060 | Alcoa, Inc. | 68,158 | ||||||
2,928 | Dow Chemical Co. (The) | 146,107 | ||||||
3,279 | Freeport-McMoRan Copper & Gold, Inc. | 112,699 | ||||||
1,221 | International Paper Co. | 56,960 | ||||||
1,022 | Nucor Corp. | 52,889 | ||||||
|
| |||||||
436,813 | ||||||||
|
| |||||||
Telecommunication Services—9.3% | ||||||||
24,047 | AT&T, Inc. | 858,478 | ||||||
10,836 | Verizon Communications, Inc. | 506,366 | ||||||
|
| |||||||
1,364,844 | ||||||||
|
| |||||||
Utilities—7.8% | ||||||||
1,059 | Ameren Corp. | 43,747 | ||||||
1,704 | American Electric Power Co., Inc. | 91,692 | ||||||
1,460 | CenterPoint Energy, Inc. | 36,150 | ||||||
1,206 | Consolidated Edison, Inc. | 69,984 | ||||||
1,224 | Dominion Resources, Inc. | 88,789 | ||||||
591 | DTE Energy Co. | 46,181 | ||||||
1,106 | Edison International | 62,555 | ||||||
957 | Entergy Corp. | 69,383 | ||||||
4,427 | Exelon Corp. | 155,078 | ||||||
2,512 | FirstEnergy Corp. | 84,780 | ||||||
1,743 | PG&E Corp. | 79,446 | ||||||
1,970 | Public Service Enterprise Group, Inc. | 80,711 | ||||||
499 | Sempra Energy | 49,206 | ||||||
2,908 | Southern Co. (The) | 133,274 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 45 |
|
PowerShares Fundamental Pure Large Value Portfolio (PXLV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Utilities (continued) | ||||||||
1,730 | Xcel Energy, Inc. | $ | 55,135 | |||||
|
| |||||||
1,146,111 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $12,917,744) | 14,695,246 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
17,692 | Invesco Premier Portfolio—Institutional Class(c) (Cost $17,692) | 17,692 | ||||||
|
| |||||||
Total Investments (Cost $12,935,436)—100.1% | 14,712,938 | |||||||
Other assets less liabilities—(0.1)% | (12,218 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 14,700,720 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 46 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Mid Core Portfolio (PXMC)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—14.5% | ||||||||
1,133 | Advance Auto Parts, Inc. | $ | 137,422 | |||||
457 | AutoZone, Inc.(b) | 243,988 | ||||||
5,256 | Bed Bath & Beyond, Inc.(b) | 326,555 | ||||||
3,015 | BorgWarner, Inc. | 187,352 | ||||||
5,429 | CarMax, Inc.(b) | 237,682 | ||||||
3,511 | Cinemark Holdings, Inc. | 103,996 | ||||||
6,539 | Dana Holding Corp. | 138,431 | ||||||
4,643 | DISH Network Corp., Class A(b) | 264,001 | ||||||
6,168 | Dollar General Corp.(b) | 348,122 | ||||||
1,653 | Expedia, Inc. | 117,346 | ||||||
2,578 | Family Dollar Stores, Inc. | 151,457 | ||||||
1,753 | Hanesbrands, Inc. | 143,904 | ||||||
11,399 | Interpublic Group of Cos., Inc. (The) | 198,571 | ||||||
2,254 | Jarden Corp.(b) | 128,816 | ||||||
2,593 | Lennar Corp., Class A | 100,064 | ||||||
2,245 | Murphy USA, Inc.(b) | 95,413 | ||||||
4,105 | Nordstrom, Inc. | 251,554 | ||||||
2,394 | PetSmart, Inc. | 162,026 | ||||||
2,874 | SeaWorld Entertainment, Inc. | 86,392 | ||||||
3,057 | Starwood Hotels & Resorts Worldwide, Inc. | 234,319 | ||||||
1,845 | Tiffany & Co. | 161,419 | ||||||
5,809 | VF Corp. | 354,872 | ||||||
1,916 | Williams-Sonoma, Inc. | 120,363 | ||||||
2,557 | Wyndham Worldwide Corp. | 182,416 | ||||||
|
| |||||||
4,476,481 | ||||||||
|
| |||||||
Consumer Staples—4.8% | ||||||||
2,328 | Brown-Forman Corp., Class B | 208,868 | ||||||
1,557 | Casey’s General Stores, Inc. | 106,904 | ||||||
1,804 | Constellation Brands, Inc., Class A(b) | 144,031 | ||||||
1,916 | Energizer Holdings, Inc. | 213,998 | ||||||
2,692 | Hormel Foods Corp. | 128,382 | ||||||
2,577 | Ingredion, Inc. | 181,550 | ||||||
3,361 | J.M. Smucker Co. (The) | 324,941 | ||||||
2,479 | McCormick & Co., Inc. | 176,505 | ||||||
|
| |||||||
1,485,179 | ||||||||
|
| |||||||
Energy—5.6% | ||||||||
1,282 | Cimarex Energy Co. | 152,712 | ||||||
6,376 | CONSOL Energy, Inc. | 283,796 | ||||||
13,718 | Denbury Resources, Inc. | 230,737 | ||||||
1,706 | Energen Corp. | 132,914 | ||||||
6,085 | Linn Co LLC | 167,703 | ||||||
1,563 | Oil States International, Inc.(b) | 151,830 | ||||||
5,202 | QEP Resources, Inc. | 159,649 | ||||||
16,026 | SandRidge Energy, Inc.(b) | 109,938 | ||||||
6,325 | Superior Energy Services, Inc. | 208,219 | ||||||
1,175 | Targa Resources Corp. | 126,888 | ||||||
|
| |||||||
1,724,386 | ||||||||
|
| |||||||
Financials—24.0% | ||||||||
1,688 | Alexandria Real Estate Equities, Inc. REIT | 124,608 | ||||||
381 | Alleghany Corp.(b) | 155,440 | ||||||
4,039 | Ameriprise Financial, Inc. | 450,873 | ||||||
3,080 | Arthur J. Gallagher & Co. | 138,662 | ||||||
5,012 | BioMed Realty Trust, Inc. REIT | 104,751 | ||||||
2,660 | Boston Properties, Inc. REIT | 311,592 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
2,082 | Camden Property Trust REIT | $ | 142,596 | |||||
5,067 | CBRE Group, Inc., Class A(b) | 134,985 | ||||||
15,103 | Charles Schwab Corp. (The) | 400,985 | ||||||
10,951 | E*TRADE Financial Corp.(b) | 245,850 | ||||||
7,145 | Equity Residential REIT | 424,699 | ||||||
1,119 | Federal Realty Investment Trust REIT | 131,527 | ||||||
7,176 | Fidelity National Financial, Inc., Class A | 230,924 | ||||||
4,498 | First American Financial Corp. | 119,647 | ||||||
19,356 | First Niagara Financial Group, Inc. | 172,655 | ||||||
7,176 | Franklin Resources, Inc. | 375,664 | ||||||
13,606 | General Growth Properties, Inc. REIT | 312,530 | ||||||
5,939 | Hatteras Financial Corp. REIT | 116,226 | ||||||
10,042 | Invesco Ltd.(c) | 353,579 | ||||||
830 | Jones Lang LaSalle, Inc. | 96,189 | ||||||
1,829 | LPL Financial Holdings, Inc. | 86,603 | ||||||
3,241 | Macerich Co. (The) REIT | 210,373 | ||||||
252 | Markel Corp.(b) | 157,732 | ||||||
17,577 | MFA Financial, Inc. REIT | 139,386 | ||||||
3,541 | NASDAQ OMX Group, Inc. (The) | 130,663 | ||||||
2,126 | Public Storage REIT | 373,134 | ||||||
2,670 | Raymond James Financial, Inc. | 132,699 | ||||||
3,427 | Rayonier, Inc. REIT | 154,558 | ||||||
1,995 | Reinsurance Group of America, Inc. | 153,036 | ||||||
1,789 | SL Green Realty Corp. REIT | 187,326 | ||||||
13,817 | SLM Corp. | 355,788 | ||||||
6,284 | UDR, Inc. REIT | 162,504 | ||||||
4,316 | Vornado Realty Trust REIT | 442,822 | ||||||
5,050 | Voya Financial, Inc. | 178,719 | ||||||
|
| |||||||
7,409,325 | ||||||||
|
| |||||||
Health Care—10.0% | ||||||||
2,876 | Alere, Inc.(b) | 96,058 | ||||||
3,949 | Becton, Dickinson and Co. | 446,356 | ||||||
1,076 | C.R. Bard, Inc. | 147,767 | ||||||
1,743 | Centene Corp.(b) | 115,735 | ||||||
6,854 | Community Health Systems, Inc.(b) | 259,698 | ||||||
4,447 | DaVita HealthCare Partners, Inc.(b) | 308,177 | ||||||
2,441 | DENTSPLY International, Inc. | 108,942 | ||||||
2,702 | Forest Laboratories, Inc.(b) | 248,341 | ||||||
1,928 | Henry Schein, Inc.(b) | 220,235 | ||||||
5,886 | Mylan, Inc.(b) | 298,891 | ||||||
2,826 | Omnicare, Inc. | 167,497 | ||||||
5,198 | Tenet Healthcare Corp.(b) | 234,326 | ||||||
1,826 | Universal Health Services, Inc., Class B | 149,349 | ||||||
2,808 | Zimmer Holdings, Inc. | 271,814 | ||||||
|
| |||||||
3,073,186 | ||||||||
|
| |||||||
Industrials—15.6% | ||||||||
1,815 | Alaska Air Group, Inc. | 170,755 | ||||||
948 | Alliant Techsystems, Inc. | 136,721 | ||||||
4,836 | C.H. Robinson Worldwide, Inc. | 284,840 | ||||||
1,363 | Carlisle Cos., Inc. | 112,107 | ||||||
5,929 | Delta Air Lines, Inc. | 218,365 | ||||||
3,993 | Dover Corp. | 344,995 | ||||||
2,328 | EMCOR Group, Inc. | 107,065 | ||||||
1,712 | Equifax, Inc. | 121,227 | ||||||
4,226 | Expeditors International of Washington, Inc. | 174,280 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 47 |
|
PowerShares Fundamental Pure Mid Core Portfolio (PXMC) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
5,430 | Fluor Corp. | $ | 411,051 | |||||
2,898 | Fortune Brands Home & Security, Inc. | 115,485 | ||||||
1,018 | Hubbell, Inc., Class B | 119,839 | ||||||
1,188 | Huntington Ingalls Industries, Inc. | 122,364 | ||||||
4,910 | Jacobs Engineering Group, Inc.(b) | 283,307 | ||||||
3,254 | Joy Global, Inc. | 196,477 | ||||||
3,465 | Parker Hannifin Corp. | 439,639 | ||||||
5,806 | Quanta Services, Inc.(b) | 204,836 | ||||||
10,880 | Republic Services, Inc. | 381,779 | ||||||
2,115 | Rockwell Automation, Inc. | 252,066 | ||||||
1,185 | Snap-on, Inc. | 137,460 | ||||||
4,554 | URS Corp. | 214,584 | ||||||
1,019 | W.W. Grainger, Inc. | 259,234 | ||||||
|
| |||||||
4,808,476 | ||||||||
|
| |||||||
Information Technology—12.8% | ||||||||
427 | Alliance Data Systems Corp.(b) | 103,291 | ||||||
2,950 | Amdocs Ltd. | 137,264 | ||||||
5,651 | Analog Devices, Inc. | 289,840 | ||||||
2,137 | Autodesk, Inc.(b) | 102,619 | ||||||
12,218 | Brocade Communications Systems, Inc.(b) | 113,750 | ||||||
7,563 | CA, Inc. | 227,949 | ||||||
3,831 | Electronic Arts, Inc.(b) | 108,417 | ||||||
4,548 | Fiserv, Inc.(b) | 276,427 | ||||||
2,957 | Harris Corp. | 217,399 | ||||||
10,357 | Juniper Networks, Inc.(b) | 255,714 | ||||||
3,119 | KLA-Tencor Corp. | 199,585 | ||||||
3,877 | Lam Research Corp.(b) | 223,354 | ||||||
4,351 | Microchip Technology, Inc. | 206,846 | ||||||
8,670 | NVIDIA Corp. | 160,135 | ||||||
11,458 | ON Semiconductor Corp.(b) | 107,820 | ||||||
7,359 | Paychex, Inc. | 307,680 | ||||||
4,267 | SanDisk Corp. | 362,567 | ||||||
2,669 | Synopsys, Inc.(b) | 100,408 | ||||||
15,088 | Western Union Co. (The) | 239,447 | ||||||
4,164 | Xilinx, Inc. | 196,499 | ||||||
|
| |||||||
3,937,011 | ||||||||
|
| |||||||
Materials—6.6% | ||||||||
1,434 | Airgas, Inc. | 152,377 | ||||||
1,870 | Albemarle Corp. | 125,365 | ||||||
3,275 | Celanese Corp., Series A | 201,183 | ||||||
12,440 | Cliffs Natural Resources, Inc. | 220,437 | ||||||
2,917 | Eastman Chemical Co. | 254,275 | ||||||
9,600 | Graphic Packaging Holding Co.(b) | 98,496 | ||||||
1,349 | International Flavors & Fragrances, Inc. | 132,903 | ||||||
888 | Martin Marietta Materials, Inc. | 110,405 | ||||||
1,552 | Packaging Corp. of America | 103,410 | ||||||
1,589 | Rockwood Holdings, Inc. | 112,898 | ||||||
5,288 | Sealed Air Corp. | 181,431 | ||||||
1,173 | Sherwin-Williams Co. (The) | 234,412 | ||||||
1,514 | Valspar Corp. (The) | 110,583 | ||||||
|
| |||||||
2,038,175 | ||||||||
|
| |||||||
Telecommunication Services—0.8% | ||||||||
3,444 | Level 3 Communications, Inc.(b) | 148,195 | ||||||
12,724 | Sprint Corp. (Japan)(b) | 108,154 | ||||||
|
| |||||||
256,349 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Utilities—5.3% | ||||||||
3,829 | AGL Resources, Inc. | $ | 206,766 | |||||
4,263 | American Water Works Co., Inc. | 194,094 | ||||||
9,308 | Northeast Utilities | 439,896 | ||||||
14,900 | NRG Energy, Inc. | 487,528 | ||||||
6,425 | Wisconsin Energy Corp. | 311,484 | ||||||
|
| |||||||
1,639,768 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $27,028,971) | 30,848,336 | |||||||
|
| |||||||
Money Market Fund—0.2% | ||||||||
68,566 | Invesco Premier Portfolio—Institutional Class(d) (Cost $68,566) | 68,566 | ||||||
|
| |||||||
Total Investments (Cost $27,097,537)—100.2% | 30,916,902 | |||||||
Other assets less liabilities—(0.2)% | (49,755 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 30,867,147 | ||||||
|
|
Investment | Abbreviations: |
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Affiliated company. The Fund’s Adviser is a wholly-owned subsidiary of Invesco Ltd. and therefore, Invesco Ltd. is considered to be affiliated. See Note 4. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 48 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—13.0% | ||||||||
21,416 | Coach, Inc. | $ | 956,224 | |||||
10,359 | Dick’s Sporting Goods, Inc. | 545,505 | ||||||
12,534 | Discovery Communications, Inc., Class A(b) | 951,331 | ||||||
16,879 | Dollar Tree, Inc.(b) | 878,889 | ||||||
16,911 | Las Vegas Sands Corp. | 1,338,167 | ||||||
15,545 | Lear Corp. | 1,291,168 | ||||||
5,435 | Liberty Media Corp., Class A(b) | 704,974 | ||||||
17,307 | LKQ Corp.(b) | 503,980 | ||||||
5,792 | O’Reilly Automotive, Inc.(b) | 861,792 | ||||||
5,528 | PVH Corp. | 694,151 | ||||||
4,491 | Ralph Lauren Corp. | 679,803 | ||||||
15,158 | Ross Stores, Inc. | 1,031,957 | ||||||
7,124 | Wynn Resorts Ltd. | 1,452,512 | ||||||
|
| |||||||
11,890,453 | ||||||||
|
| |||||||
Consumer Staples—4.6% | ||||||||
9,250 | Church & Dwight Co., Inc. | 638,343 | ||||||
11,004 | Estee Lauder Cos., Inc. (The), Class A | 798,560 | ||||||
8,871 | Hershey Co. (The) | 853,745 | ||||||
9,897 | Mead Johnson Nutrition Co. | 873,509 | ||||||
21,543 | Whole Foods Market, Inc. | 1,070,687 | ||||||
|
| |||||||
4,234,844 | ||||||||
|
| |||||||
Energy—14.6% | ||||||||
23,962 | Cameron International Corp.(b) | 1,556,572 | ||||||
5,644 | Concho Resources, Inc.(b) | 736,260 | ||||||
8,066 | EQT Corp. | 879,113 | ||||||
15,544 | FMC Technologies, Inc.(b) | 881,345 | ||||||
8,050 | Helmerich & Payne, Inc. | 874,632 | ||||||
39,303 | HollyFrontier Corp. | 2,066,945 | ||||||
23,889 | Noble Energy, Inc. | 1,714,752 | ||||||
6,232 | Oceaneering International, Inc. | 456,681 | ||||||
16,579 | PBF Energy, Inc., Class A | 510,302 | ||||||
4,793 | Pioneer Natural Resources Co. | 926,343 | ||||||
5,371 | Range Resources Corp. | 485,807 | ||||||
23,810 | Southwestern Energy Co.(b) | 1,140,023 | ||||||
12,467 | Whiting Petroleum Corp.(b) | 919,067 | ||||||
5,919 | World Fuel Services Corp. | 269,551 | ||||||
|
| |||||||
13,417,393 | ||||||||
|
| |||||||
Financials—23.6% | ||||||||
2,496 | Affiliated Managers Group, Inc.(b) | 494,707 | ||||||
12,088 | American Campus Communities, Inc. REIT | 461,762 | ||||||
66,903 | American Capital Agency Corp. REIT | 1,519,367 | ||||||
11,276 | American Tower Corp. REIT | 941,771 | ||||||
9,757 | AvalonBay Communities, Inc. REIT | 1,332,318 | ||||||
11,159 | Crown Castle International Corp. REIT | 811,594 | ||||||
49,885 | CYS Investments, Inc. REIT | 429,011 | ||||||
15,286 | Digital Realty Trust, Inc. REIT | 816,272 | ||||||
2,929 | Essex Property Trust, Inc. REIT | 507,479 | ||||||
9,332 | First Republic Bank | 473,692 | ||||||
55,073 | HCP, Inc. REIT | 2,305,356 | ||||||
27,662 | Health Care REIT, Inc. | 1,745,196 | ||||||
3,189 | IntercontinentalExchange Group, Inc. | 651,959 | ||||||
25,020 | Invesco Mortgage Capital, Inc. REIT(c) | 417,084 | ||||||
27,215 | Leucadia National Corp. | 694,527 | ||||||
8,437 | Moody’s Corp. | 662,304 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
44,932 | Prologis, Inc. REIT | $ | 1,825,587 | |||||
9,695 | Realogy Holdings Corp.(b) | 407,675 | ||||||
11,057 | Realty Income Corp. REIT | 480,427 | ||||||
26,309 | Senior Housing Properties Trust REIT | 617,472 | ||||||
18,290 | T. Rowe Price Group, Inc. | 1,502,158 | ||||||
13,415 | TD Ameritrade Holding Corp. | 427,939 | ||||||
31,380 | Ventas, Inc. REIT | 2,073,590 | ||||||
|
| |||||||
21,599,247 | ||||||||
|
| |||||||
Health Care—11.0% | ||||||||
4,797 | Actavis PLC(b) | 980,171 | ||||||
18,953 | Agilent Technologies, Inc. | 1,024,220 | ||||||
15,519 | Catamaran Corp.(b) | 585,842 | ||||||
9,947 | Cerner Corp.(b) | 510,281 | ||||||
7,096 | Endo International PLC(b) | 446,658 | ||||||
27,205 | Hologic, Inc.(b) | 570,897 | ||||||
1,626 | Intuitive Surgical, Inc.(b) | 588,124 | ||||||
7,399 | MEDNAX, Inc.(b) | 438,391 | ||||||
18,861 | St. Jude Medical, Inc. | 1,197,108 | ||||||
20,785 | Stryker Corp. | 1,616,034 | ||||||
6,729 | Varian Medical Systems, Inc.(b) | 535,292 | ||||||
4,153 | Waters Corp.(b) | 409,236 | ||||||
38,251 | Zoetis, Inc. | 1,157,475 | ||||||
|
| |||||||
10,059,729 | ||||||||
|
| |||||||
Industrials—11.1% | ||||||||
11,499 | AMETEK, Inc. | 606,227 | ||||||
6,947 | B/E Aerospace, Inc.(b) | 609,738 | ||||||
15,848 | Fastenal Co. | 793,668 | ||||||
9,667 | Flowserve Corp. | 706,174 | ||||||
6,333 | J.B. Hunt Transport Services, Inc. | 481,941 | ||||||
6,294 | Kansas City Southern | 634,939 | ||||||
23,766 | Nielsen Holdings NV | 1,115,814 | ||||||
6,676 | Pall Corp. | 561,785 | ||||||
5,236 | Roper Industries, Inc. | 727,542 | ||||||
20,335 | Stanley Black & Decker, Inc. | 1,746,573 | ||||||
4,285 | Towers Watson & Co., Class A | 480,863 | ||||||
2,493 | TransDigm Group, Inc. | 443,430 | ||||||
17,035 | United Continental Holdings, Inc.(b) | 696,221 | ||||||
14,308 | Xylem, Inc. | 537,838 | ||||||
|
| |||||||
10,142,753 | ||||||||
|
| |||||||
Information Technology—16.6% | ||||||||
58,458 | Activision Blizzard, Inc. | 1,169,745 | ||||||
20,837 | Adobe Systems, Inc.(b) | 1,285,435 | ||||||
7,798 | Akamai Technologies, Inc.(b) | 413,840 | ||||||
20,593 | Altera Corp. | 669,684 | ||||||
7,496 | Amphenol Corp., Class A | 714,744 | ||||||
44,854 | Broadcom Corp., Class A | 1,381,952 | ||||||
11,344 | Citrix Systems, Inc.(b) | 672,813 | ||||||
25,131 | Cognizant Technology Solutions Corp., Class A(b) | 1,203,901 | ||||||
2,769 | Equinix, Inc.(b) | 520,046 | ||||||
22,729 | Fidelity National Information Services, Inc. | 1,214,410 | ||||||
10,779 | First Solar, Inc.(b) | 727,475 | ||||||
10,750 | �� | Intuit, Inc. | 814,312 | |||||
16,267 | Linear Technology Corp. | 723,881 | ||||||
28,461 | NetApp, Inc. | 1,013,496 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 49 |
|
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
12,338 | Teradata Corp.(b) | $ | 560,885 | |||||
23,854 | Western Digital Corp. | 2,102,253 | ||||||
|
| |||||||
15,188,872 | ||||||||
|
| |||||||
Materials—5.5% | ||||||||
6,222 | CF Industries Holdings, Inc. | 1,525,448 | ||||||
14,192 | Ecolab, Inc. | 1,485,051 | ||||||
8,065 | FMC Corp. | 621,005 | ||||||
7,089 | Rock-Tenn Co., Class A | 677,779 | ||||||
7,425 | Sigma-Aldrich Corp. | 714,359 | ||||||
|
| |||||||
5,023,642 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $77,008,845) | 91,556,933 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
70,121 | Invesco Premier Portfolio—Institutional Class(d) (Cost $70,121) | 70,121 | ||||||
|
| |||||||
Total Investments (Cost $77,078,966)—100.1% | 91,627,054 | |||||||
Other assets less liabilities—(0.1)% | (71,915 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 91,555,139 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Affiliated company. The Fund’s Adviser is a wholly-owned subsidiary of Invesco Ltd. and therefore, Invesco Mortgage Capital, Inc. is considered to be affiliated. See Note 4. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 50 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Mid Value Portfolio (PXMV)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—18.7% | ||||||||
3,307 | Abercrombie & Fitch Co., Class A | $ | 121,565 | |||||
8,839 | American Eagle Outfitters, Inc. | 102,179 | ||||||
4,328 | Apollo Education Group, Inc.(b) | 124,906 | ||||||
2,744 | AutoNation, Inc.(b) | 145,405 | ||||||
3,876 | Big Lots, Inc.(b) | 153,102 | ||||||
11,039 | Cablevision Systems Corp., Class A | 184,351 | ||||||
4,261 | Caesars Entertainment Corp.(b)(c) | 78,701 | ||||||
1,581 | Charter Communications, Inc., Class A(b) | 214,273 | ||||||
6,428 | CST Brands, Inc. | 209,746 | ||||||
4,914 | D.R. Horton, Inc. | 109,484 | ||||||
4,714 | Darden Restaurants, Inc. | 234,333 | ||||||
931 | Dillard’s, Inc., Class A | 91,173 | ||||||
3,811 | Foot Locker, Inc. | 177,326 | ||||||
4,715 | GameStop Corp., Class A | 187,091 | ||||||
7,328 | Gannett Co., Inc. | 199,102 | ||||||
5,373 | Gap, Inc. (The) | 211,159 | ||||||
3,504 | Genuine Parts Co. | 305,268 | ||||||
13,135 | Goodyear Tire & Rubber Co. (The) | 331,002 | ||||||
137 | Graham Holdings Co., Class B | 91,959 | ||||||
2,733 | Guess?, Inc. | 73,545 | ||||||
5,438 | H&R Block, Inc. | 154,548 | ||||||
3,250 | Harley-Davidson, Inc. | 240,305 | ||||||
2,671 | Hasbro, Inc. | 147,599 | ||||||
8,170 | International Game Technology | 102,534 | ||||||
48,096 | J.C. Penney Co., Inc.(b)(c) | 409,778 | ||||||
1,179 | Lands’ End, Inc.(b)(c) | 32,599 | ||||||
4,484 | Leggett & Platt, Inc. | 147,344 | ||||||
12,391 | Liberty Interactive Corp., Class A(b) | 360,082 | ||||||
2,712 | Marriott International, Inc., Class A | 157,106 | ||||||
8,015 | Mattel, Inc. | 314,308 | ||||||
7,289 | MGM Resorts International(b) | 183,901 | ||||||
1,093 | Mohawk Industries, Inc.(b) | 144,724 | ||||||
5,631 | Newell Rubbermaid, Inc. | 169,549 | ||||||
16,894 | News Corp., Class A(b) | 287,536 | ||||||
70 | NVR, Inc.(b) | 75,390 | ||||||
30,746 | Office Depot, Inc.(b) | 125,751 | ||||||
4,144 | Rent-A-Center, Inc. | 121,046 | ||||||
3,443 | Royal Caribbean Cruises Ltd. | 182,927 | ||||||
3,918 | Sears Holdings Corp.(b)(c) | 171,648 | ||||||
4,617 | Service Corp. International | 86,661 | ||||||
1,956 | Tenneco, Inc.(b) | 117,106 | ||||||
4,356 | TRW Automotive Holdings Corp.(b) | 350,005 | ||||||
1,912 | Visteon Corp.(b) | 165,981 | ||||||
2,708 | Whirlpool Corp. | 415,353 | ||||||
|
| |||||||
8,009,451 | ||||||||
|
| |||||||
Consumer Staples—7.2% | ||||||||
22,075 | Avon Products, Inc. | 337,306 | ||||||
4,583 | Campbell Soup Co. | 208,481 | ||||||
2,589 | Clorox Co. (The) | 234,822 | ||||||
5,334 | Coca-Cola Enterprises, Inc. | 242,377 | ||||||
14,288 | Dean Foods Co. | 226,322 | ||||||
4,386 | Dr Pepper Snapple Group, Inc. | 243,072 | ||||||
7,156 | Hillshire Brands Co. (The) | 255,112 | ||||||
3,854 | Molson Coors Brewing Co., Class B | 231,124 | ||||||
58,008 | Rite Aid Corp.(b) | 423,458 | ||||||
39,791 | SUPERVALU, Inc.(b) | 278,139 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Staples (continued) | ||||||||
9,559 | Tyson Foods, Inc., Class A | $ | 401,191 | |||||
|
| |||||||
3,081,404 | ||||||||
|
| |||||||
Energy—7.0% | ||||||||
39,516 | Alpha Natural Resources, Inc.(b)(c) | 169,919 | ||||||
32,100 | Arch Coal, Inc.(c) | 147,018 | ||||||
5,181 | Diamond Offshore Drilling, Inc.(c) | 282,934 | ||||||
2,481 | Exterran Holdings, Inc. | 106,732 | ||||||
13,642 | McDermott International, Inc.(b)(c) | 98,632 | ||||||
5,851 | Newfield Exploration Co.(b) | 198,056 | ||||||
5,113 | ONEOK, Inc. | 323,244 | ||||||
3,768 | Patterson-UTI Energy, Inc. | 122,573 | ||||||
16,133 | Peabody Energy Corp. | 306,688 | ||||||
3,615 | Rowan Cos. PLC, Class A | 111,776 | ||||||
1,048 | SEACOR Holdings, Inc.(b) | 87,393 | ||||||
7,399 | Tesoro Corp. | 416,490 | ||||||
1,850 | Tidewater, Inc. | 94,220 | ||||||
1,704 | Unit Corp.(b) | 112,379 | ||||||
2,498 | Western Refining, Inc.(c) | 108,663 | ||||||
14,624 | WPX Energy, Inc.(b) | 311,199 | ||||||
|
| |||||||
2,997,916 | ||||||||
|
| |||||||
Financials—20.3% | ||||||||
6,869 | American Capital Ltd.(b) | 102,966 | ||||||
2,750 | American Financial Group, Inc. | 160,683 | ||||||
84 | American National Insurance Co. | 9,442 | ||||||
3,639 | Apartment Investment & Management Co., Class A REIT | 112,190 | ||||||
5,744 | Associated Banc-Corp. | 100,807 | ||||||
3,581 | Assurant, Inc. | 241,395 | ||||||
5,507 | Brandywine Realty Trust REIT | 80,127 | ||||||
5,040 | CBL & Associates Properties, Inc. REIT | 91,577 | ||||||
5,025 | Cincinnati Financial Corp. | 244,919 | ||||||
4,680 | CIT Group, Inc. | 201,474 | ||||||
8,372 | CNO Financial Group, Inc. | 144,417 | ||||||
4,838 | Columbia Property Trust, Inc. REIT | 137,109 | ||||||
4,920 | Comerica, Inc. | 237,341 | ||||||
2,174 | Commerce Bancshares, Inc. | 94,526 | ||||||
4,129 | CommonWealth REIT | 104,918 | ||||||
1,279 | Cullen/Frost Bankers, Inc. | 97,728 | ||||||
5,167 | DDR Corp. REIT | 88,717 | ||||||
7,899 | Duke Realty Corp. REIT | 138,391 | ||||||
3,971 | Federated Investors, Inc., Class B(c) | 113,332 | ||||||
6,790 | First Horizon National Corp. | 78,017 | ||||||
1,630 | Hanover Insurance Group, Inc. (The) | 95,274 | ||||||
2,876 | HCC Insurance Holdings, Inc. | 132,123 | ||||||
5,738 | Hospitality Properties Trust REIT | 172,427 | ||||||
12,317 | Host Hotels & Resorts, Inc. REIT | 264,200 | ||||||
23,068 | Hudson City Bancorp, Inc. | 229,757 | ||||||
23,245 | Huntington Bancshares, Inc. | 212,924 | ||||||
879 | Kemper Corp. | 34,641 | ||||||
8,558 | Kimco Realty Corp. REIT | 196,149 | ||||||
2,972 | Legg Mason, Inc. | 139,357 | ||||||
3,756 | Liberty Property Trust REIT | 140,850 | ||||||
3,218 | M&T Bank Corp. | 392,628 | ||||||
4,702 | Mack-Cali Realty Corp. REIT | 95,780 | ||||||
3,917 | McGraw-Hill Financial, Inc. | 289,584 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 51 |
|
PowerShares Fundamental Pure Mid Value Portfolio (PXMV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
18,156 | New York Community Bancorp, Inc. | $ | 279,784 | |||||
5,004 | Northern Trust Corp. | 301,491 | ||||||
9,420 | Old Republic International Corp. | 155,995 | ||||||
13,441 | People’s United Financial, Inc. | 191,937 | ||||||
5,712 | PHH Corp.(b) | 135,774 | ||||||
7,425 | Piedmont Office Realty Trust, Inc., Class A REIT | 130,754 | ||||||
3,828 | Plum Creek Timber Co., Inc. REIT | 166,901 | ||||||
8,089 | Principal Financial Group, Inc. | 378,889 | ||||||
3,023 | Protective Life Corp. | 154,626 | ||||||
1,841 | Regency Centers Corp. REIT | 96,524 | ||||||
6,508 | Retail Properties of America, Inc., Class A REIT | 93,195 | ||||||
1,452 | StanCorp Financial Group, Inc. | 88,717 | ||||||
26,110 | Synovus Financial Corp. | 83,813 | ||||||
4,983 | TCF Financial Corp. | 78,233 | ||||||
2,325 | Torchmark Corp. | 185,303 | ||||||
10,000 | Unum Group | 332,200 | ||||||
8,698 | Valley National Bancorp | 87,154 | ||||||
3,743 | W.R. Berkley Corp. | 165,590 | ||||||
2,773 | Weingarten Realty Investors REIT | 86,518 | ||||||
10,753 | XL Group PLC | 337,107 | ||||||
5,449 | Zions Bancorp. | 157,585 | ||||||
|
| |||||||
8,663,860 | ||||||||
|
| |||||||
Health Care—4.6% | ||||||||
27,462 | Boston Scientific Corp.(b) | 346,296 | ||||||
4,965 | CareFusion Corp.(b) | 193,933 | ||||||
6,715 | Health Net, Inc.(b) | 230,526 | ||||||
3,660 | Hospira, Inc.(b) | 167,628 | ||||||
3,694 | Kindred Healthcare, Inc. | 92,719 | ||||||
2,217 | Laboratory Corp. of America Holdings(b) | 218,818 | ||||||
2,091 | LifePoint Hospitals, Inc.(b) | 116,929 | ||||||
3,378 | Owens & Minor, Inc. | 113,298 | ||||||
4,653 | Quest Diagnostics, Inc. | 260,242 | ||||||
852 | Teleflex, Inc. | 86,981 | ||||||
1,968 | WellCare Health Plans, Inc.(b) | 132,781 | ||||||
|
| |||||||
1,960,151 | ||||||||
|
| |||||||
Industrials—15.9% | ||||||||
6,119 | ADT Corp. (The) | 185,039 | ||||||
4,855 | AECOM Technology Corp.(b) | 157,399 | ||||||
3,848 | AGCO Corp. | 214,334 | ||||||
10,212 | American Airlines Group, Inc.(b) | 358,135 | ||||||
2,207 | Armstrong World Industries, Inc.(b) | 116,000 | ||||||
6,358 | Avis Budget Group, Inc.(b) | 334,367 | ||||||
1,814 | Cintas Corp. | 106,899 | ||||||
2,344 | Con-way, Inc. | 99,573 | ||||||
6,511 | Exelis, Inc. | 120,714 | ||||||
3,824 | General Cable Corp. | 97,971 | ||||||
3,407 | Harsco Corp. | 81,529 | ||||||
14,502 | Hertz Global Holdings, Inc.(b) | 412,872 | ||||||
6,371 | Ingersoll-Rand PLC | 380,986 | ||||||
4,500 | Iron Mountain, Inc. | 127,980 | ||||||
3,733 | ITT Corp. | 161,042 | ||||||
12,400 | JetBlue Airways Corp.(b) | 98,022 | ||||||
5,625 | KBR, Inc. | 142,706 | ||||||
1,852 | Kennametal, Inc. | 86,544 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
3,339 | L-3 Communications Holdings, Inc. | $ | 385,220 | |||||
3,514 | Manpowergroup, Inc. | 285,829 | ||||||
7,727 | Masco Corp. | 155,235 | ||||||
3,870 | MRC Global, Inc.(b) | 112,965 | ||||||
3,955 | Navistar International Corp.(b) | 150,013 | ||||||
2,588 | Oshkosh Corp. | 143,660 | ||||||
3,732 | Owens Corning | 152,452 | ||||||
9,314 | Pitney Bowes, Inc. | 249,615 | ||||||
14,117 | R.R. Donnelley & Sons Co. | 248,459 | ||||||
2,186 | Robert Half International, Inc. | 97,933 | ||||||
2,256 | Rockwell Collins, Inc. | 175,178 | ||||||
2,329 | Ryder System, Inc. | 191,397 | ||||||
3,456 | Spirit Aerosystems Holdings, Inc., Class A(b) | 103,784 | ||||||
1,131 | SPX Corp. | 115,181 | ||||||
2,915 | Terex Corp. | 126,190 | ||||||
6,798 | Textron, Inc. | 278,038 | ||||||
2,182 | Timken Co. (The) | 137,641 | ||||||
1,662 | Trinity Industries, Inc. | 124,750 | ||||||
1,666 | United Rentals, Inc.(b) | 156,321 | ||||||
1,447 | WESCO International, Inc.(b) | 127,018 | ||||||
|
| |||||||
6,798,991 | ||||||||
|
| |||||||
Information Technology—7.5% | ||||||||
25,909 | Advanced Micro Devices, Inc.(b)(c) | 105,968 | ||||||
890 | Anixter International, Inc. | 87,202 | ||||||
3,859 | AOL, Inc.(b) | 165,204 | ||||||
4,944 | Arrow Electronics, Inc.(b) | 280,572 | ||||||
3,491 | Booz Allen Hamilton Holding Corp. | 81,131 | ||||||
1,102 | CACI International, Inc., Class A(b) | 76,754 | ||||||
5,361 | Computer Sciences Corp. | 317,264 | ||||||
3,233 | CoreLogic, Inc.(b) | 90,621 | ||||||
1,458 | Insight Enterprises, Inc.(b) | 38,083 | ||||||
11,146 | Jabil Circuit, Inc. | 192,380 | ||||||
4,255 | Leidos Holdings, Inc. | 158,456 | ||||||
2,275 | Lexmark International, Inc., Class A | 97,825 | ||||||
6,120 | Maxim Integrated Products, Inc. | 198,533 | ||||||
3,826 | Motorola Solutions, Inc. | 243,257 | ||||||
3,366 | NCR Corp.(b) | 102,697 | ||||||
6,673 | Sanmina Corp.(b) | 135,128 | ||||||
2,189 | Science Applications International Corp. | 85,371 | ||||||
15,430 | Symantec Corp. | 312,920 | ||||||
1,448 | SYNNEX Corp.(b) | 97,566 | ||||||
1,684 | Tech Data Corp.(b) | 105,233 | ||||||
2,706 | Total System Services, Inc. | 85,970 | ||||||
2,821 | Unisys Corp.(b) | 68,748 | ||||||
6,068 | Vishay Intertechnology, Inc. | 86,287 | ||||||
|
| |||||||
3,213,170 | ||||||||
|
| |||||||
Materials—7.0% | ||||||||
4,141 | Allegheny Technologies, Inc. | 170,609 | ||||||
1,832 | Ashland, Inc. | 176,971 | ||||||
3,314 | Avery Dennison Corp. | 161,259 | ||||||
2,960 | Ball Corp. | 166,322 | ||||||
3,436 | Bemis Co., Inc. | 138,265 | ||||||
1,613 | Cabot Corp. | 93,231 | ||||||
6,298 | Commercial Metals Co. | 120,922 | ||||||
4,016 | Crown Holdings, Inc.(b) | 189,435 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 52 |
|
PowerShares Fundamental Pure Mid Value Portfolio (PXMV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Materials (continued) | ||||||||
7,300 | Huntsman Corp. | $ | 182,865 | |||||
5,833 | MeadWestvaco Corp. | 227,895 | ||||||
5,875 | Owens-Illinois, Inc.(b) | 186,707 | ||||||
2,266 | Reliance Steel & Aluminum Co. | 160,478 | ||||||
2,910 | RPM International, Inc. | 124,141 | ||||||
3,194 | Sonoco Products Co. | 134,404 | ||||||
5,269 | Southern Copper Corp. (Mexico) | 158,808 | ||||||
8,872 | Steel Dynamics, Inc. | 162,091 | ||||||
10,339 | United States Steel Corp.(c) | 269,021 | ||||||
2,384 | Vulcan Materials Co. | 153,840 | ||||||
|
| |||||||
2,977,264 | ||||||||
|
| |||||||
Telecommunication Services—2.3% | ||||||||
68,943 | Frontier Communications Corp. | 410,211 | ||||||
5,615 | Telephone & Data Systems, Inc. | 152,672 | ||||||
44,746 | Windstream Holdings, Inc.(c) | 405,846 | ||||||
|
| |||||||
968,729 | ||||||||
|
| |||||||
Utilities—9.5% | ||||||||
3,634 | Alliant Energy Corp. | 212,516 | ||||||
3,015 | Atmos Energy Corp. | 153,886 | ||||||
12,455 | Calpine Corp.(b) | 285,593 | ||||||
8,869 | CMS Energy Corp. | 268,819 | ||||||
6,157 | Great Plains Energy, Inc. | 165,192 | ||||||
3,210 | Hawaiian Electric Industries, Inc. | 77,008 | ||||||
2,937 | Integrys Energy Group, Inc. | 179,979 | ||||||
4,232 | MDU Resources Group, Inc. | 149,897 | ||||||
1,631 | National Fuel Gas Co. | 120,107 | ||||||
9,296 | NiSource, Inc. | 337,631 | ||||||
5,020 | OGE Energy Corp. | 187,397 | ||||||
13,980 | Pepco Holdings, Inc. | 374,105 | ||||||
4,508 | Pinnacle West Capital Corp. | 252,223 | ||||||
3,134 | Portland General Electric Co. | 104,895 | ||||||
4,672 | Questar Corp. | 113,436 | ||||||
4,870 | SCANA Corp. | 261,422 | ||||||
1,046 | Southwest Gas Corp. | 57,540 | ||||||
10,808 | TECO Energy, Inc. | 194,112 | ||||||
3,931 | UGI Corp. | 183,538 | ||||||
2,364 | Vectren Corp. | 95,908 | ||||||
4,588 | Westar Energy, Inc. | 164,617 | ||||||
2,463 | WGL Holdings, Inc. | 98,003 | ||||||
|
| |||||||
4,037,824 | ||||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $35,443,864)—100.0% | 42,708,760 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—4.2% | ||||||||
1,785,849 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $1,785,849) | 1,785,849 | ||||||
|
| |||||||
Total Investments (Cost $37,229,713)—104.2% | 44,494,609 | |||||||
Other assets less liabilities—(4.2)% | (1,785,644 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 42,708,965 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 1,741,934 | $ | (1,741,934 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 53 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Small Core Portfolio (PXSC)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—17.1% | ||||||||
2,950 | Aaron’s, Inc. | $ | 86,936 | |||||
265 | America’s Car-Mart, Inc.(b) | 9,577 | ||||||
3,868 | Ascena Retail Group, Inc.(b) | 66,530 | ||||||
567 | Bally Technologies, Inc.(b) | 36,917 | ||||||
599 | BJ’s Restaurants, Inc.(b) | 17,101 | ||||||
1,435 | Bloomin’ Brands, Inc.(b) | 30,594 | ||||||
671 | Bravo Brio Restaurant Group, Inc.(b) | 10,045 | ||||||
345 | Bright Horizons Family Solutions, Inc.(b) | 14,069 | ||||||
1,447 | Buckle, Inc. (The) | 67,995 | ||||||
1,012 | Cabela’s, Inc.(b) | 66,397 | ||||||
228 | Capella Education Co. | 13,306 | ||||||
303 | Carriage Services, Inc. | 4,875 | ||||||
1,033 | Carter’s, Inc. | 76,091 | ||||||
860 | Cheesecake Factory, Inc. (The) | 38,605 | ||||||
3,875 | Chico’s FAS, Inc. | 61,535 | ||||||
910 | Choice Hotels International, Inc. | 40,204 | ||||||
193 | Collectors Universe, Inc. | 4,532 | ||||||
367 | Conn’s, Inc.(b) | 16,232 | ||||||
141 | Container Store Group, Inc. (The)(b) | 3,890 | ||||||
833 | Core-Mark Holding Co., Inc. | 67,090 | ||||||
578 | Cracker Barrel Old Country Store, Inc. | 54,760 | ||||||
237 | Culp, Inc. | 4,278 | ||||||
1,671 | DeVry Education Group, Inc. | 75,245 | ||||||
450 | DineEquity, Inc. | 34,114 | ||||||
685 | Domino’s Pizza, Inc. | 50,950 | ||||||
375 | Drew Industries, Inc. | 18,870 | ||||||
893 | Entravision Communications Corp., Class A | 4,742 | ||||||
319 | Extended Stay America, Inc. | 6,874 | ||||||
239 | Fiesta Restaurant Group, Inc.(b) | 8,750 | ||||||
1,420 | Finish Line, Inc. (The), Class A | 39,093 | ||||||
829 | Genesco, Inc.(b) | 63,311 | ||||||
2,272 | Gentex Corp. | 65,138 | ||||||
1,602 | Hillenbrand, Inc. | 48,701 | ||||||
614 | Houghton Mifflin Harcourt Co.(b) | 12,544 | ||||||
652 | HSN, Inc. | 37,842 | ||||||
529 | Interval Leisure Group, Inc. | 13,632 | ||||||
364 | Jamba, Inc.(b) | 4,026 | ||||||
759 | Jos. A. Bank Clothiers, Inc.(b) | 48,993 | ||||||
555 | Kirkland’s, Inc.(b) | 9,496 | ||||||
971 | La-Z-Boy, Inc. | 23,527 | ||||||
2,207 | LeapFrog Enterprises, Inc.(b) | 15,118 | ||||||
1,307 | Life Time Fitness, Inc.(b) | 62,736 | ||||||
493 | LIN Media LLC, Class A(b) | 11,551 | ||||||
4,243 | Live Nation Entertainment, Inc.(b) | 88,594 | ||||||
867 | Madison Square Garden Co. (The), Class A(b) | 47,338 | ||||||
448 | MDC Partners, Inc., Class A | 10,940 | ||||||
160 | Motorcar Parts of America, Inc.(b) | 4,390 | ||||||
325 | Movado Group, Inc. | 12,766 | ||||||
312 | Multimedia Games Holding Co., Inc.(b) | 9,110 | ||||||
1,850 | National CineMedia, Inc. | 28,102 | ||||||
1,538 | Norwegian Cruise Line Holdings Ltd.(b) | 50,400 | ||||||
815 | Outerwall, Inc.(b) | 56,520 | ||||||
552 | Overstock.com, Inc.(b) | 8,843 | ||||||
261 | Oxford Industries, Inc. | 17,229 | ||||||
488 | Papa John’s International, Inc. | 21,404 | ||||||
736 | Pool Corp. | 43,439 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
4,376 | PulteGroup, Inc. | $ | 80,475 | |||||
411 | Remy International, Inc. | 10,900 | ||||||
2,911 | Sally Beauty Holdings, Inc.(b) | 79,791 | ||||||
1,137 | Select Comfort Corp.(b) | 20,921 | ||||||
503 | Shoe Carnival, Inc. | 11,489 | ||||||
1,289 | Sinclair Broadcast Group, Inc., Class A | 34,455 | ||||||
608 | Skullcandy, Inc.(b) | 4,682 | ||||||
1,070 | Sotheby’s | 45,004 | ||||||
578 | Standard Motor Products, Inc. | 21,958 | ||||||
2,169 | Standard Pacific Corp.(b) | 17,330 | ||||||
1,465 | Starz, Class A(b) | 47,276 | ||||||
91 | Strattec Security Corp. | 6,080 | ||||||
777 | Taylor Morrison Home Corp., Class A(b) | 16,480 | ||||||
384 | Tilly’s, Inc., Class A(b) | 4,339 | ||||||
1,038 | Tupperware Brands Corp. | 88,137 | ||||||
386 | Universal Electronics, Inc.(b) | 14,417 | ||||||
2,224 | Urban Outfitters, Inc.(b) | 79,297 | ||||||
587 | Vail Resorts, Inc. | 40,638 | ||||||
1,799 | Wolverine World Wide, Inc. | 50,552 | ||||||
662 | Zumiez, Inc.(b) | 16,186 | ||||||
|
| |||||||
2,536,294 | ||||||||
|
| |||||||
Consumer Staples—5.7% | ||||||||
1,143 | Andersons, Inc. (The) | 71,198 | ||||||
1,264 | B&G Foods, Inc. | 41,459 | ||||||
340 | Calavo Growers, Inc. | 10,571 | ||||||
690 | Diamond Foods, Inc.(b) | 21,093 | ||||||
4,198 | Flowers Foods, Inc. | 86,143 | ||||||
720 | Fresh Market, Inc. (The)(b) | 26,712 | ||||||
2,397 | Harbinger Group, Inc.(b) | 27,949 | ||||||
237 | J & J Snack Foods Corp. | 22,183 | ||||||
398 | Lancaster Colony Corp. | 37,762 | ||||||
322 | Nature’s Sunshine Products, Inc. | 4,302 | ||||||
1,286 | Pinnacle Foods, Inc. | 39,094 | ||||||
526 | Sanderson Farms, Inc. | 43,274 | ||||||
8 | Seaboard Corp.(b) | 19,504 | ||||||
1,661 | Snyders-Lance, Inc. | 44,116 | ||||||
1,191 | Susser Holdings Corp.(b) | 92,160 | ||||||
390 | Tootsie Roll Industries, Inc. | 10,994 | ||||||
1,016 | TreeHouse Foods, Inc.(b) | 76,037 | ||||||
1,334 | United Natural Foods, Inc.(b) | 92,086 | ||||||
124 | USANA Health Sciences, Inc.(b) | 8,415 | ||||||
2,271 | WhiteWave Foods Co. (The), Class A(b) | 62,884 | ||||||
|
| |||||||
837,936 | ||||||||
|
| |||||||
Energy—5.8% | ||||||||
1,674 | Atwood Oceanics, Inc.(b) | 82,963 | ||||||
843 | Bristow Group, Inc. | 64,742 | ||||||
166 | Clayton Williams Energy, Inc.(b) | 23,984 | ||||||
2,255 | Delek US Holdings, Inc. (Israel) | 72,137 | ||||||
1,690 | Dresser-Rand Group, Inc.(b) | 102,144 | ||||||
454 | Dril-Quip, Inc.(b) | 51,356 | ||||||
955 | EPL Oil & Gas, Inc.(b) | 37,379 | ||||||
526 | Era Group, Inc.(b) | 15,017 | ||||||
674 | Goodrich Petroleum Corp.(b) | 16,951 | ||||||
1,475 | Green Plains Renewable Energy, Inc. | 44,102 | ||||||
760 | Gulfmark Offshore, Inc., Class A | 34,208 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 54 |
|
PowerShares Fundamental Pure Small Core Portfolio (PXSC) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Energy (continued) | ||||||||
514 | Hallador Energy Co. | $ | 4,708 | |||||
543 | Matrix Service Co.(b) | 16,817 | ||||||
2,132 | Midstates Petroleum Co., Inc.(b) | 12,579 | ||||||
248 | Natural Gas Services Group, Inc.(b) | 7,611 | ||||||
802 | Nuverra Environmental Solutions, Inc.(b) | 13,642 | ||||||
116 | Panhandle Oil and Gas, Inc., Class A | 5,087 | ||||||
665 | PDC Energy, Inc.(b) | 42,341 | ||||||
214 | REX American Resources Corp.(b) | 13,987 | ||||||
955 | Rosetta Resources, Inc.(b) | 45,210 | ||||||
847 | SemGroup Corp., Class A | 54,106 | ||||||
857 | SM Energy Co. | 63,529 | ||||||
642 | TGC Industries, Inc.(b) | 3,249 | ||||||
9,127 | Vantage Drilling Co.(b) | 15,242 | ||||||
500 | Westmoreland Coal Co.(b) | 14,805 | ||||||
|
| |||||||
857,896 | ||||||||
|
| |||||||
Financials—21.3% | ||||||||
1,169 | Acadia Realty Trust REIT | 31,715 | ||||||
258 | Access National Corp. | 3,805 | ||||||
320 | Agree Realty Corp. REIT | 9,558 | ||||||
53 | Alexander’s, Inc. REIT | 18,325 | ||||||
3,502 | American Capital Mortgage Investment Corp. REIT | 69,340 | ||||||
3,008 | American Equity Investment Life Holding Co. | 70,147 | ||||||
402 | Amreit, Inc., Class B REIT | 6,697 | ||||||
1,963 | Apollo Residential Mortgage, Inc. REIT | 31,702 | ||||||
393 | Arlington Asset Investment Corp., Class A | 10,395 | ||||||
64 | Artisan Partners Asset Management, Inc., Class A | 3,716 | ||||||
346 | Banc of California, Inc. | 4,349 | ||||||
588 | Bancorp, Inc. (The)(b) | 9,302 | ||||||
155 | Bank of Kentucky Financial Corp. (The) | 5,349 | ||||||
149 | Bank of Marin Bancorp | 6,766 | ||||||
2,163 | BankUnited, Inc. | 71,357 | ||||||
839 | Berkshire Hills Bancorp, Inc. | 19,658 | ||||||
4,245 | BGC Partners, Inc., Class A | 30,437 | ||||||
255 | Bridge Bancorp, Inc. | 6,202 | ||||||
163 | Bridge Capital Holdings(b) | 3,651 | ||||||
2,505 | Brown & Brown, Inc. | 74,599 | ||||||
309 | Bryn Mawr Bank Corp. | 8,429 | ||||||
87 | BSB Bancorp, Inc.(b) | 1,518 | ||||||
241 | Center Bancorp, Inc. | 4,461 | ||||||
685 | Centerstate Banks, Inc. | 7,514 | ||||||
294 | CNB Financial Corp. | 4,857 | ||||||
1,170 | Community Bank System, Inc. | 43,512 | ||||||
2,380 | Corrections Corp. of America REIT | 78,064 | ||||||
3,240 | Cowen Group, Inc., Class A(b) | 13,316 | ||||||
2,000 | CubeSmart REIT | 37,200 | ||||||
73 | Diamond Hill Investment Group Inc. | 8,667 | ||||||
2,560 | East West Bancorp, Inc. | 88,346 | ||||||
637 | EastGroup Properties, Inc. REIT | 40,290 | ||||||
2,280 | Eaton Vance Corp. | 82,240 | ||||||
2,770 | Education Realty Trust, Inc. REIT | 28,254 | ||||||
160 | eHealth, Inc.(b) | 6,702 | ||||||
547 | Empire State Realty Trust, Inc., Class A REIT | 8,369 | ||||||
1,628 | Equity One, Inc. REIT | 36,679 | ||||||
329 | Erie Indemnity Co., Class A | 23,573 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
2,942 | EZCORP, Inc., Class A(b) | $ | 30,685 | |||||
350 | Fidelity Southern Corp. | 4,623 | ||||||
2,506 | First Financial Bancorp | 40,572 | ||||||
513 | First Financial Bankshares, Inc. | 30,293 | ||||||
1,859 | First Industrial Realty Trust, Inc. REIT | 34,150 | ||||||
201 | First of Long Island Corp. (The) | 7,290 | ||||||
239 | Fox Chase Bancorp, Inc. | 3,987 | ||||||
211 | Franklin Financial Corp.(b) | 4,212 | ||||||
1,681 | Geo Group, Inc. (The) REIT | 56,364 | ||||||
318 | German American Bancorp, Inc. | 8,281 | ||||||
547 | Gladstone Commercial Corp. REIT | 9,649 | ||||||
903 | Gladstone Investment Corp. | 7,098 | ||||||
3,671 | Glimcher Realty Trust REIT | 37,407 | ||||||
2,926 | Healthcare Realty Trust, Inc. REIT | 73,589 | ||||||
1,189 | Hercules Technology Growth Capital, Inc. | 16,266 | ||||||
780 | Heritage Financial Corp. | 12,605 | ||||||
6,484 | Hersha Hospitality Trust REIT | 37,672 | ||||||
2,449 | Highwoods Properties, Inc. REIT | 98,817 | ||||||
139 | Home Bancorp, Inc.(b) | 2,815 | ||||||
1,483 | Home Properties, Inc. REIT | 91,353 | ||||||
432 | HomeStreet, Inc. | 7,845 | ||||||
782 | IBERIABANK Corp. | 49,188 | ||||||
643 | Independent Bank Corp. | 23,868 | ||||||
408 | Lakeland Financial Corp. | 14,933 | ||||||
2,106 | LaSalle Hotel Properties REIT | 69,666 | ||||||
591 | LTC Properties, Inc. REIT | 22,830 | ||||||
4,939 | MBIA, Inc.(b) | 59,861 | ||||||
121 | Meta Financial Group, Inc. | 5,071 | ||||||
226 | MidSouth Bancorp, Inc. | 3,779 | ||||||
180 | MidWestOne Financial Group, Inc. | 4,433 | ||||||
1,115 | Monmouth Real Estate Investment Corp., Class A REIT | 10,470 | ||||||
310 | National Health Investors, Inc. REIT | 19,124 | ||||||
3,913 | National Penn Bancshares, Inc. | 38,230 | ||||||
2,406 | National Retail Properties, Inc. REIT | 82,117 | ||||||
399 | NewStar Financial, Inc.(b) | 4,557 | ||||||
410 | Nicholas Financial, Inc. | 6,445 | ||||||
254 | OmniAmerican Bancorp, Inc. | 6,314 | ||||||
307 | Pacific Premier Bancorp, Inc.(b) | 4,191 | ||||||
989 | Parkway Properties, Inc. REIT | 18,653 | ||||||
460 | PICO Holdings, Inc.(b) | 10,695 | ||||||
673 | Pinnacle Financial Partners, Inc. | 23,266 | ||||||
1,029 | Post Properties, Inc. REIT | 51,666 | ||||||
1,236 | PrivateBancorp, Inc. | 34,077 | ||||||
1,842 | ProAssurance Corp. | 83,664 | ||||||
1,112 | Prosperity Bancshares, Inc. | 65,608 | ||||||
381 | PS Business Parks, Inc. REIT | 32,678 | ||||||
1,708 | Radian Group, Inc. | 23,878 | ||||||
5,546 | Resource Capital Corp. REIT | 30,503 | ||||||
639 | Rouse Properties, Inc. REIT | 10,729 | ||||||
373 | Safeguard Scientifics, Inc.(b) | 7,837 | ||||||
2,916 | Santander Consumer USA Holdings, Inc. (Spain)(b) | 66,310 | ||||||
272 | Saul Centers, Inc. REIT | 12,482 | ||||||
2,049 | SEI Investments Co. | 66,347 | ||||||
678 | Select Income REIT | 20,869 | ||||||
543 | Southside Bancshares, Inc. | 14,976 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 55 |
|
PowerShares Fundamental Pure Small Core Portfolio (PXSC) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
586 | Sovran Self Storage, Inc. REIT | $ | 44,477 | |||||
3,183 | Spirit Realty Capital, Inc. REIT | 34,281 | ||||||
1,329 | Sterling Bancorp | 15,895 | ||||||
1,771 | Summit Hotel Properties, Inc. REIT | 16,045 | ||||||
4,813 | Symetra Financial Corp. | 99,437 | ||||||
951 | Taubman Centers, Inc. REIT | 69,271 | ||||||
273 | Taylor Capital Group, Inc.(b) | 5,812 | ||||||
276 | Territorial Bancorp, Inc. | 5,647 | ||||||
1,326 | TFS Financial Corp.(b) | 17,755 | ||||||
338 | Tompkins Financial Corp. | 15,933 | ||||||
888 | UMB Financial Corp. | 52,134 | ||||||
634 | UMH Properties, Inc. REIT | 6,245 | ||||||
650 | Union Bankshares Corp. | 16,633 | ||||||
1,437 | United Financial Bancorp, Inc. | 18,911 | ||||||
210 | Universal Health Realty Income Trust REIT | 8,910 | ||||||
427 | Walker & Dunlop, Inc.(b) | 6,695 | ||||||
1,037 | Western Alliance Bancorp(b) | 23,924 | ||||||
1,143 | Wintrust Financial Corp. | 51,229 | ||||||
197 | WSFS Financial Corp. | 13,321 | ||||||
|
| |||||||
3,146,504 | ||||||||
|
| |||||||
Health Care—8.9% | ||||||||
150 | Addus HomeCare Corp.(b) | 3,243 | ||||||
318 | Almost Family, Inc.(b) | 6,827 | ||||||
2,594 | Alphatec Holdings, Inc.(b) | 3,502 | ||||||
179 | Analogic Corp. | 13,439 | ||||||
818 | AngioDynamics, Inc.(b) | 10,994 | ||||||
315 | ArthroCare Corp.(b) | 15,287 | ||||||
31 | Atrion Corp. | 8,938 | ||||||
587 | Bio-Rad Laboratories, Inc., Class A(b) | 72,324 | ||||||
1,502 | Bruker Corp.(b) | 31,031 | ||||||
449 | Capital Senior Living Corp.(b) | 11,104 | ||||||
434 | Chemed Corp. | 36,139 | ||||||
182 | Computer Programs & Systems, Inc. | 11,490 | ||||||
543 | CONMED Corp. | 25,157 | ||||||
148 | Corvel Corp.(b) | 6,740 | ||||||
850 | Covance, Inc.(b) | 75,038 | ||||||
210 | Cynosure, Inc., Class A(b) | 5,153 | ||||||
587 | Emergent Biosolutions, Inc.(b) | 15,473 | ||||||
1,006 | Envision Healthcare Holdings, Inc.(b) | 33,993 | ||||||
301 | Exactech, Inc.(b) | 6,688 | ||||||
655 | Greatbatch, Inc.(b) | 30,150 | ||||||
1,036 | Haemonetics Corp.(b) | 31,453 | ||||||
952 | Hanger, Inc.(b) | 33,006 | ||||||
2,120 | HealthSouth Corp. | 73,437 | ||||||
264 | ICU Medical, Inc.(b) | 14,726 | ||||||
1,608 | Impax Laboratories, Inc.(b) | 42,049 | ||||||
529 | Integra LifeSciences Holdings Corp.(b) | 24,112 | ||||||
299 | Landauer, Inc. | 12,929 | ||||||
945 | Meridian Bioscience, Inc. | 18,872 | ||||||
1,119 | Merit Medical Systems, Inc.(b) | 14,402 | ||||||
457 | Omnicell, Inc.(b) | 12,101 | ||||||
2,065 | Patterson Cos., Inc. | 84,046 | ||||||
1,987 | PerkinElmer, Inc. | 83,394 | ||||||
962 | Prestige Brands Holdings, Inc.(b) | 32,246 | ||||||
1,389 | Quality Systems, Inc. | 20,516 | ||||||
298 | Quidel Corp.(b) | 6,392 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
749 | Quintiles Transnational Holdings, Inc.(b) | $ | 35,300 | |||||
2,213 | Rigel Pharmaceuticals, Inc.(b) | 7,082 | ||||||
2,089 | RTI Surgical, Inc.(b) | 8,983 | ||||||
4,962 | Select Medical Holdings Corp. | 69,270 | ||||||
765 | Sirona Dental Systems, Inc.(b) | 57,543 | ||||||
1,628 | STERIS Corp. | 78,225 | ||||||
75 | Utah Medical Products, Inc. | 3,809 | ||||||
2,140 | VCA Antech, Inc.(b) | 65,548 | ||||||
668 | VIVUS, Inc.(b) | 3,474 | ||||||
965 | West Pharmaceutical Services, Inc. | 41,862 | ||||||
789 | Wright Medical Group, Inc.(b) | 21,579 | ||||||
|
| |||||||
1,319,066 | ||||||||
|
| |||||||
Industrials—20.5% | ||||||||
1,137 | A.O. Smith Corp. | 53,166 | ||||||
289 | AAON, Inc. | 8,193 | ||||||
497 | Aceto Corp. | 10,874 | ||||||
1,307 | Actuant Corp., Class A | 44,255 | ||||||
451 | Acuity Brands, Inc. | 56,181 | ||||||
1,676 | Aegion Corp.(b) | 42,721 | ||||||
175 | Alamo Group, Inc. | 9,296 | ||||||
478 | Altra Industrial Motion Corp. | 16,329 | ||||||
147 | AMERCO | 36,766 | ||||||
764 | Ameresco, Inc., Class A(b) | 4,897 | ||||||
155 | American Railcar Industries, Inc. | 10,763 | ||||||
2,023 | Babcock & Wilcox Co. (The) | 70,380 | ||||||
106 | Barrett Business Services, Inc. | 5,344 | ||||||
1,402 | Beacon Roofing Supply, Inc.(b) | 49,883 | ||||||
1,801 | Blount International, Inc.(b) | 20,117 | ||||||
505 | CAI International, Inc.(b) | 10,984 | ||||||
611 | Celadon Group, Inc. | 14,059 | ||||||
292 | CIRCOR International, Inc. | 23,713 | ||||||
865 | CLARCOR, Inc. | 49,962 | ||||||
1,355 | Copart, Inc.(b) | 49,146 | ||||||
398 | Corporate Executive Board Co. (The) | 27,470 | ||||||
491 | Cubic Corp. | 23,288 | ||||||
973 | Curtiss-Wright Corp. | 62,214 | ||||||
786 | DigitalGlobe, Inc.(b) | 23,407 | ||||||
1,867 | Donaldson Co., Inc. | 78,582 | ||||||
1,091 | EnerSys | 73,730 | ||||||
212 | Erickson Air-Crane, Inc.(b) | 3,352 | ||||||
742 | ESCO Technologies, Inc. | 24,798 | ||||||
738 | Esterline Technologies Corp.(b) | 80,457 | ||||||
176 | Exponent, Inc. | 12,394 | ||||||
462 | Forward Air Corp. | 20,434 | ||||||
620 | Franklin Electric Co., Inc. | 23,975 | ||||||
1,504 | Generac Holdings, Inc. | 88,556 | ||||||
520 | Global Power Equipment Group, Inc. | 9,116 | ||||||
335 | Gorman-Rupp Co. (The) | 10,402 | ||||||
303 | GP Strategies Corp.(b) | 7,963 | ||||||
702 | Graco, Inc. | 50,895 | ||||||
115 | Graham Corp. | 3,432 | ||||||
2,118 | Griffon Corp. | 22,536 | ||||||
1,945 | HD Supply Holdings, Inc.(b) | 50,142 | ||||||
1,196 | Healthcare Services Group, Inc. | 34,804 | ||||||
1,232 | Hub Group, Inc., Class A(b) | 55,009 | ||||||
412 | Huron Consulting Group, Inc.(b) | 29,334 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 56 |
|
PowerShares Fundamental Pure Small Core Portfolio (PXSC) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
1,232 | IDEX Corp. | $ | 91,870 | |||||
1,596 | InnerWorkings, Inc.(b) | 11,491 | ||||||
2,748 | KAR Auction Services, Inc. | 81,836 | ||||||
1,950 | Kratos Defense & Security Solutions, Inc.(b) | 14,079 | ||||||
895 | Landstar System, Inc. | 56,376 | ||||||
1,267 | Lincoln Electric Holdings, Inc. | 84,648 | ||||||
731 | Marten Transport Ltd. | 17,149 | ||||||
872 | Mobile Mini, Inc. | 38,525 | ||||||
1,293 | Moog, Inc., Class A(b) | 84,627 | ||||||
868 | MSC Industrial Direct Co., Inc., Class A | 79,040 | ||||||
869 | MYR Group, Inc.(b) | 20,387 | ||||||
683 | Nordson Corp. | 50,781 | ||||||
1,526 | Orbital Sciences Corp.(b) | 44,864 | ||||||
119 | Patrick Industries, Inc.(b) | 4,768 | ||||||
251 | Powell Industries, Inc. | 15,893 | ||||||
227 | PowerSecure International, Inc.(b) | 5,046 | ||||||
346 | RBC Bearings, Inc.(b) | 21,542 | ||||||
1,218 | Regal-Beloit Corp. | 91,021 | ||||||
4,374 | Southwest Airlines Co. | 105,720 | ||||||
506 | SP Plus Corp.(b) | 12,357 | ||||||
140 | Sparton Corp.(b) | 3,802 | ||||||
240 | Stock Building Supply Holdings, Inc.(b) | 4,154 | ||||||
1,860 | Swift Transportation Co.(b) | 44,733 | ||||||
1,214 | TAL International Group, Inc. | 51,207 | ||||||
239 | Taser International, Inc.(b) | 3,860 | ||||||
433 | Team, Inc.(b) | 18,571 | ||||||
749 | Teledyne Technologies, Inc.(b) | 69,552 | ||||||
325 | Tennant Co. | 20,732 | ||||||
2,127 | Tetra Tech, Inc.(b) | 60,981 | ||||||
435 | Thermon Group Holdings, Inc.(b) | 10,362 | ||||||
1,721 | Titan International, Inc. | 30,135 | ||||||
1,708 | Titan Machinery, Inc.(b) | 30,129 | ||||||
745 | Toro Co. (The) | 47,337 | ||||||
133 | Trex Co., Inc.(b) | 10,443 | ||||||
297 | UniFirst Corp. | 28,583 | ||||||
166 | Universal Truckload Services, Inc. | 4,094 | ||||||
339 | US Ecology, Inc. | 15,136 | ||||||
1,172 | Wabash National Corp.(b) | 15,658 | ||||||
617 | WABCO Holdings, Inc.(b) | 66,025 | ||||||
764 | Watsco, Inc. | 78,623 | ||||||
1,066 | Wesco Aircraft Holdings, Inc.(b) | 21,597 | ||||||
1,232 | Woodward, Inc. | 55,231 | ||||||
|
| |||||||
3,026,284 | ||||||||
|
| |||||||
Information Technology—11.6% | ||||||||
1,547 | ARRIS Group, Inc.(b) | 40,361 | ||||||
135 | Aspen Technology, Inc.(b) | 5,804 | ||||||
234 | Badger Meter, Inc. | 11,595 | ||||||
604 | Blackbaud, Inc. | 18,392 | ||||||
2,505 | Broadridge Financial Solutions, Inc. | 96,042 | ||||||
169 | Cass Information Systems, Inc. | 8,536 | ||||||
742 | Ciena Corp.(b) | 14,669 | ||||||
483 | Coherent, Inc.(b) | 28,840 | ||||||
421 | Computer Task Group, Inc. | 6,656 | ||||||
329 | Comverse, Inc.(b) | 8,205 | ||||||
1,015 | CSG Systems International, Inc. | 26,755 | ||||||
457 | Dealertrack Technologies, Inc.(b) | 20,880 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
1,618 | Demand Media, Inc.(b) | $ | 6,731 | |||||
1,001 | Dolby Laboratories, Inc., Class A(b) | 39,890 | ||||||
603 | DST Systems, Inc. | 55,591 | ||||||
358 | DTS, Inc.(b) | 6,662 | ||||||
1,463 | EchoStar Corp., Class A(b) | 65,777 | ||||||
595 | Electronics for Imaging, Inc.(b) | 22,485 | ||||||
2,950 | Entropic Communications, Inc.(b) | 10,886 | ||||||
880 | EPIQ Systems, Inc. | 11,255 | ||||||
640 | Exar Corp.(b) | 6,925 | ||||||
1,596 | Extreme Networks, Inc.(b) | 9,129 | ||||||
210 | FARO Technologies, Inc.(b) | 8,379 | ||||||
318 | Forrester Research, Inc. | 11,267 | ||||||
1,075 | Global Payments, Inc. | 71,842 | ||||||
893 | Heartland Payment Systems, Inc. | 36,560 | ||||||
1,513 | II-VI, Inc.(b) | 21,787 | ||||||
1,601 | Infinera Corp.(b) | 14,345 | ||||||
1,117 | IntraLinks Holdings, Inc.(b) | 10,221 | ||||||
4,323 | JDS Uniphase Corp.(b) | 54,772 | ||||||
294 | KVH Industries, Inc.(b) | 3,972 | ||||||
1,969 | Lattice Semiconductor Corp.(b) | 16,579 | ||||||
1,942 | Limelight Networks, Inc.(b) | 4,020 | ||||||
7,751 | LSI Corp. | 86,346 | ||||||
390 | Manhattan Associates, Inc.(b) | 12,297 | ||||||
1,476 | ManTech International Corp., Class A | 44,029 | ||||||
235 | Measurement Specialties, Inc.(b) | 15,122 | ||||||
2,331 | Mentor Graphics Corp. | 48,252 | ||||||
1,112 | Mercury Systems, Inc.(b) | 15,524 | ||||||
105 | MicroStrategy, Inc., Class A(b) | 12,750 | ||||||
472 | MoneyGram International, Inc.(b) | 6,230 | ||||||
258 | MTS Systems Corp. | 16,633 | ||||||
472 | Nanometrics, Inc.(b) | 7,675 | ||||||
1,579 | National Instruments Corp. | 43,123 | ||||||
1,143 | NETGEAR, Inc.(b) | 36,919 | ||||||
1,295 | NeuStar, Inc., Class A(b) | 33,307 | ||||||
2,567 | Oclaro, Inc.(b) | 8,728 | ||||||
940 | PC Connection, Inc. | 18,809 | ||||||
495 | PC-Tel, Inc. | 4,084 | ||||||
554 | Perficient, Inc.(b) | 10,122 | ||||||
767 | Plantronics, Inc. | 33,418 | ||||||
1,260 | PTC, Inc.(b) | 44,566 | ||||||
1,137 | Rambus, Inc.(b) | 13,746 | ||||||
339 | Rogers Corp.(b) | 20,347 | ||||||
548 | Rosetta Stone, Inc.(b) | 6,527 | ||||||
593 | Rubicon Technology, Inc.(b) | 6,007 | ||||||
706 | SeaChange International, Inc.(b) | 6,615 | ||||||
1,207 | Semtech Corp.(b) | 28,944 | ||||||
589 | ServiceSource International, Inc.(b) | 3,675 | ||||||
575 | Silicon Laboratories, Inc.(b) | 25,846 | ||||||
646 | SunPower Corp. (France)(b) | 21,589 | ||||||
2,172 | Take-Two Interactive Software, Inc.(b) | 44,265 | ||||||
1,195 | Telenav, Inc.(b) | 7,325 | ||||||
4,390 | Teradyne, Inc.(b) | 77,571 | ||||||
232 | Tessco Technologies, Inc. | 7,631 | ||||||
1,072 | Tessera Technologies, Inc. | 23,509 | ||||||
2,073 | TIBCO Software, Inc.(b) | 40,693 | ||||||
4,392 | TriQuint Semiconductor, Inc.(b) | 62,279 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 57 |
|
PowerShares Fundamental Pure Small Core Portfolio (PXSC) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
931 | Veeco Instruments, Inc.(b) | $ | 34,419 | |||||
282 | Vocus, Inc.(b) | 5,070 | ||||||
|
| |||||||
1,709,802 | ||||||||
|
| |||||||
Materials—6.2% | ||||||||
1,435 | AptarGroup, Inc. | 96,748 | ||||||
309 | Arabian American Development Co.(b) | 3,377 | ||||||
1,410 | Axiall Corp. | 65,706 | ||||||
2,933 | Berry Plastics Group, Inc.(b) | 65,963 | ||||||
1,024 | Calgon Carbon Corp.(b) | 20,511 | ||||||
132 | Chase Corp. | 4,110 | ||||||
696 | Clearwater Paper Corp.(b) | 42,727 | ||||||
744 | Compass Minerals International, Inc. | 68,150 | ||||||
128 | Deltic Timber Corp. | 7,776 | ||||||
346 | Eagle Materials, Inc. | 28,832 | ||||||
719 | FutureFuel Corp. | 14,430 | ||||||
299 | Hawkins, Inc. | 10,824 | ||||||
738 | Innophos Holdings, Inc. | 41,653 | ||||||
511 | Innospec, Inc. | 22,004 | ||||||
2,095 | Intrepid Potash, Inc.(b) | 34,149 | ||||||
288 | KMG Chemicals, Inc. | 4,496 | ||||||
947 | Landec Corp.(b) | 11,231 | ||||||
2,053 | Louisiana-Pacific Corp.(b) | 33,649 | ||||||
681 | LSB Industries, Inc.(b) | 26,007 | ||||||
202 | NewMarket Corp. | 75,209 | ||||||
1,586 | Omnova Solutions, Inc.(b) | 14,464 | ||||||
1,436 | PolyOne Corp. | 53,807 | ||||||
274 | Quaker Chemical Corp. | 20,394 | ||||||
700 | Schweitzer-Mauduit International, Inc. | 30,548 | ||||||
551 | Stepan Co. | 31,864 | ||||||
3,386 | Stillwater Mining Co.(b) | 53,431 | ||||||
730 | Taminco Corp.(b) | 14,666 | ||||||
155 | UFP Technologies, Inc.(b) | 3,931 | ||||||
793 | Zep, Inc. | 13,711 | ||||||
|
| |||||||
914,368 | ||||||||
|
| |||||||
Telecommunication Services—1.3% | ||||||||
277 | Atlantic Tele-Network, Inc. | 16,390 | ||||||
943 | IDT Corp., Class B | 14,937 | ||||||
1,391 | Inteliquent, Inc. | 18,973 | ||||||
3,775 | Iridium Communications, Inc.(b) | 25,179 | ||||||
552 | Shenandoah Telecommunications Co. | 15,473 | ||||||
2,746 | tw telecom, inc.(b) | 84,275 | ||||||
5,568 | Vonage Holdings Corp.(b) | 21,381 | ||||||
|
| |||||||
196,608 | ||||||||
|
| |||||||
Utilities—1.6% | ||||||||
1,020 | American States Water Co. | 30,967 | ||||||
3,810 | Aqua America, Inc. | 95,593 | ||||||
292 | Chesapeake Utilities Corp. | 18,472 | ||||||
280 | Connecticut Water Service, Inc. | 9,100 | ||||||
2,042 | UIL Holdings Corp. | 75,003 | ||||||
333 | York Water Co. (The) | 6,663 | ||||||
|
| |||||||
235,798 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $13,590,177) | 14,780,556 | |||||||
|
|
Number of Shares | Value | |||||||
Money Market Fund—0.3% | ||||||||
43,639 | Invesco Premier Portfolio—Institutional Class(c) (Cost $43,639) | $ | 43,639 | |||||
|
| |||||||
Total Investments (Cost $13,633,816)—100.3% | 14,824,195 | |||||||
Other assets less liabilities—(0.3)% | (40,549 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 14,783,646 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 58 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Small Growth Portfolio (PXSG)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—99.9% | ||||||||
Consumer Discretionary—13.3% | ||||||||
1,809 | AMC Networks, Inc., Class A(b) | $ | 118,797 | |||||
818 | American Public Education, Inc.(b) | 28,303 | ||||||
1,550 | Black Diamond, Inc.(b) | 17,282 | ||||||
2,870 | Bridgepoint Education, Inc.(b) | 45,489 | ||||||
631 | Buffalo Wild Wings, Inc.(b) | 92,202 | ||||||
337 | Cavco Industries, Inc.(b) | 26,269 | ||||||
717 | Churchill Downs, Inc. | 62,974 | ||||||
371 | Chuy’s Holdings, Inc.(b) | 13,337 | ||||||
5,886 | Cumulus Media, Inc., Class A(b) | 37,729 | ||||||
1,786 | Deckers Outdoor Corp.(b) | 141,005 | ||||||
1,147 | Del Frisco’s Restaurant Group, Inc.(b) | 29,833 | ||||||
650 | Diamond Resorts International, Inc.(b) | 12,161 | ||||||
1,061 | Dorman Products, Inc.(b) | 61,061 | ||||||
5,113 | DSW, Inc., Class A | 170,723 | ||||||
2,777 | Dunkin’ Brands Group, Inc. | 126,381 | ||||||
2,090 | Five Below, Inc.(b) | 84,248 | ||||||
1,977 | Fossil Group, Inc.(b) | 210,847 | ||||||
2,475 | Francesca’s Holdings Corp.(b) | 40,491 | ||||||
1,063 | Gentherm, Inc.(b) | 38,640 | ||||||
1,254 | G-III Apparel Group Ltd.(b) | 90,000 | ||||||
4,289 | GNC Holdings, Inc., Class A | 193,005 | ||||||
1,118 | Grand Canyon Education, Inc.(b) | 48,208 | ||||||
6,211 | Groupon, Inc.(b) | 43,415 | ||||||
1,229 | Hibbett Sports, Inc.(b) | 66,182 | ||||||
6,022 | Hilton Worldwide Holdings, Inc.(b) | 131,460 | ||||||
882 | HomeAway, Inc.(b) | 28,771 | ||||||
3,481 | Iconix Brand Group, Inc.(b) | 147,942 | ||||||
957 | iRobot Corp.(b)(c) | 32,059 | ||||||
2,294 | K12, Inc.(b) | 54,322 | ||||||
2,304 | Krispy Kreme Doughnuts, Inc.(b) | 40,412 | ||||||
707 | LifeLock, Inc.(b) | 11,100 | ||||||
3,739 | Lions Gate Entertainment Corp. | 99,196 | ||||||
605 | Lumber Liquidators Holdings, Inc.(b) | 52,732 | ||||||
652 | Mattress Firm Holding Corp.(b) | 29,464 | ||||||
1,215 | Monro Muffler Brake, Inc. | 68,526 | ||||||
557 | Morningstar, Inc. | 40,845 | ||||||
930 | Nexstar Broadcasting Group, Inc., Class A(c) | 37,061 | ||||||
1,108 | Panera Bread Co., Class A(b) | 169,491 | ||||||
5,016 | Pier 1 Imports, Inc. | 91,592 | ||||||
548 | Popeyes Louisiana Kitchen, Inc.(b) | 20,879 | ||||||
1,101 | Restoration Hardware Holdings, Inc.(b) | 68,691 | ||||||
611 | RG Barry Corp. | 11,169 | ||||||
2,788 | Scripps Networks Interactive, Inc., Class A | 209,295 | ||||||
1,611 | Shutterfly, Inc.(b) | 65,938 | ||||||
3,716 | Six Flags Entertainment Corp. | 149,160 | ||||||
3,859 | Smith & Wesson Holding Corp.(b)(c) | 59,236 | ||||||
2,942 | Steven Madden Ltd.(b) | 104,765 | ||||||
910 | Sturm Ruger & Co., Inc.(c) | 58,559 | ||||||
3,674 | Texas Roadhouse, Inc. | 90,895 | ||||||
1,706 | Tumi Holdings, Inc.(b) | 34,837 | ||||||
1,659 | Ulta Salon, Cosmetics & Fragrance, Inc.(b) | 145,511 | ||||||
976 | Vera Bradley, Inc.(b) | 27,621 | ||||||
2,103 | Vitamin Shoppe, Inc.(b) | 100,692 | ||||||
590 | WCI Communities, Inc.(b) | 11,310 | ||||||
|
| |||||||
3,992,113 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Staples—3.3% | ||||||||
414 | Annie’s, Inc.(b) | $ | 13,459 | |||||
182 | Boston Beer Co., Inc. (The), Class A(b) | 44,779 | ||||||
2,820 | Boulder Brands, Inc.(b) | 41,623 | ||||||
786 | Chefs’ Warehouse, Inc. (The)(b) | 15,791 | ||||||
4,515 | Coty, Inc., Class A | 72,466 | ||||||
8,989 | Darling International, Inc.(b) | 179,870 | ||||||
1,694 | Hain Celestial Group, Inc. (The)(b) | 145,718 | ||||||
1,055 | Inter Parfums, Inc. | 38,603 | ||||||
839 | Medifast, Inc.(b) | 26,554 | ||||||
2,062 | Nu Skin Enterprises, Inc., Class A | 179,394 | ||||||
732 | PriceSmart, Inc. | 70,301 | ||||||
1,310 | Spectrum Brands Holdings, Inc. | 100,647 | ||||||
1,833 | Sprouts Farmers Market, Inc.(b) | 58,601 | ||||||
|
| |||||||
987,806 | ||||||||
|
| |||||||
Energy—6.3% | ||||||||
523 | Antero Resources Corp.(b) | 34,345 | ||||||
2,553 | Approach Resources, Inc.(b) | 52,975 | ||||||
949 | Bonanza Creek Energy, Inc.(b) | 46,140 | ||||||
6,679 | BPZ Resources, Inc.(b) | 18,033 | ||||||
3,466 | C&J Energy Services, Inc.(b) | 104,188 | ||||||
795 | CARBO Ceramics, Inc. | 111,228 | ||||||
1,714 | Carrizo Oil & Gas, Inc.(b) | 94,304 | ||||||
3,666 | Clean Energy Fuels Corp.(b)(c) | 32,444 | ||||||
8,572 | Cobalt International Energy, Inc.(b) | 154,296 | ||||||
1,065 | Contango Oil & Gas Co.(b) | 51,163 | ||||||
909 | Continental Resources, Inc.(b) | 125,915 | ||||||
356 | Diamondback Energy, Inc.(b) | 25,611 | ||||||
3,602 | Forum Energy Technologies, Inc.(b) | 107,556 | ||||||
403 | Geospace Technologies Corp.(b) | 23,426 | ||||||
1,663 | Gulfport Energy Corp.(b) | 122,513 | ||||||
17,004 | Halcon Resources Corp.(b)(c) | 93,862 | ||||||
7,627 | Kodiak Oil & Gas Corp.(b) | 96,939 | ||||||
1,898 | Laredo Petroleum, Inc.(b) | 55,479 | ||||||
3,405 | Magnum Hunter Resources Corp.(b) | 28,943 | ||||||
1,067 | Matador Resources Co.(b) | 30,644 | ||||||
2,141 | Miller Energy Resources, Inc.(b) | 10,320 | ||||||
3,575 | Northern Oil and Gas, Inc.(b) | 55,162 | ||||||
1,972 | Oasis Petroleum, Inc.(b) | 91,718 | ||||||
3,044 | Renewable Energy Group, Inc.(b) | 35,828 | ||||||
16,050 | Rentech, Inc.(b) | 34,026 | ||||||
6,282 | Resolute Energy Corp.(b) | 47,115 | ||||||
2,138 | Rex Energy Corp.(b) | 45,026 | ||||||
422 | RigNet, Inc.(b) | 19,733 | ||||||
3,599 | RPC, Inc. | 80,006 | ||||||
499 | RSP Permian, Inc.(b) | 14,147 | ||||||
773 | Sanchez Energy Corp.(b) | 21,860 | ||||||
1,581 | Triangle Petroleum Corp.(b) | 15,209 | ||||||
|
| |||||||
1,880,154 | ||||||||
|
| |||||||
Financials—26.4% | ||||||||
1,734 | 1st United Bancorp, Inc. | 12,693 | ||||||
3,010 | American Assets Trust, Inc. REIT | 102,189 | ||||||
3,685 | American Homes 4 Rent, Class A REIT | 59,144 | ||||||
1,949 | AmTrust Financial Services, Inc. | 75,368 | ||||||
3,327 | Apollo Commercial Real Estate Finance, Inc. REIT | 56,592 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 59 |
|
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
895 | Ares Commercial Real Estate Corp. REIT | $ | 11,420 | |||||
36,268 | ARMOUR Residential REIT, Inc. | 153,776 | ||||||
3,460 | Associated Estates Realty Corp. REIT | 58,059 | ||||||
689 | AVIV REIT, Inc. | 18,183 | ||||||
1,035 | Bank of the Ozarks, Inc. | 61,996 | ||||||
3,911 | BBCN Bancorp, Inc. | 60,269 | ||||||
1,230 | BNC Bancorp | 20,049 | ||||||
261 | BofI Holding, Inc.(b) | 21,039 | ||||||
4,073 | Campus Crest Communities, Inc. REIT | 35,069 | ||||||
2,197 | Capital Bank Financial Corp., Class A(b) | 52,398 | ||||||
1,861 | Cardinal Financial Corp. | 31,265 | ||||||
2,499 | CBOE Holdings, Inc. | 133,347 | ||||||
18,014 | Chambers Street Properties REIT | 140,329 | ||||||
1,144 | Chatham Lodging Trust REIT | 23,258 | ||||||
2,807 | Chesapeake Lodging Trust REIT | 75,761 | ||||||
51,409 | Chimera Investment Corp. REIT | 158,854 | ||||||
3,081 | Colony Financial, Inc. REIT | 67,012 | ||||||
3,270 | Columbia Banking System, Inc. | 81,161 | ||||||
967 | CoreSite Realty Corp. REIT | 29,416 | ||||||
243 | Credit Acceptance Corp.(b) | 31,959 | ||||||
1,496 | Customers Bancorp, Inc.(b) | 32,957 | ||||||
2,118 | CyrusOne, Inc. REIT | 42,360 | ||||||
4,100 | DuPont Fabros Technology, Inc. REIT | 99,343 | ||||||
7,079 | Dynex Capital, Inc. REIT | 60,738 | ||||||
705 | Eagle Bancorp, Inc.(b) | 23,540 | ||||||
1,259 | Encore Capital Group, Inc.(b) | 54,414 | ||||||
3,513 | Equity Lifestyle Properties, Inc. REIT | 147,089 | ||||||
6,803 | Everbank Financial Corp. | 127,352 | ||||||
781 | Evercore Partners, Inc., Class A | 41,729 | ||||||
3,091 | Excel Trust, Inc. REIT | 39,008 | ||||||
3,869 | Extra Space Storage, Inc. REIT | 202,465 | ||||||
1,459 | Fidelity & Guaranty Life | 31,281 | ||||||
797 | Fidus Investment Corp. | 14,601 | ||||||
466 | Financial Engines, Inc. | 20,621 | ||||||
1,274 | First Cash Financial Services, Inc.(b) | 62,133 | ||||||
686 | First Connecticut Bancorp, Inc. | 10,873 | ||||||
925 | First Financial Holdings, Inc. | 53,160 | ||||||
474 | First NBC Bank Holding Co.(b) | 14,741 | ||||||
5,252 | Government Properties Income Trust REIT | 133,663 | ||||||
2,146 | Green Dot Corp., Class A(b) | 37,276 | ||||||
1,349 | GSV Capital Corp.(b) | 11,844 | ||||||
7,702 | Hancock Holding Co. | 259,788 | ||||||
329 | HCI Group, Inc. | 12,726 | ||||||
12,066 | Healthcare Trust of America, Inc., Class A REIT | 141,052 | ||||||
997 | HFF, Inc., Class A | 33,898 | ||||||
1,558 | Home BancShares, Inc. | 49,404 | ||||||
1,022 | Howard Hughes Corp. (The)(b) | 145,901 | ||||||
2,119 | Hudson Pacific Properties, Inc. REIT | 49,902 | ||||||
1,094 | ICG Group, Inc.(b) | 22,296 | ||||||
1,849 | INTL FCStone, Inc.(b) | 34,983 | ||||||
1,449 | Investors Bancorp, Inc. | 38,732 | ||||||
1,020 | Kennedy-Wilson Holdings, Inc. | 22,277 | ||||||
4,413 | Kilroy Realty Corp. REIT | 262,882 | ||||||
877 | MarketAxess Holdings, Inc. | 47,253 | ||||||
10,079 | Medical Properties Trust, Inc. REIT | 136,067 | ||||||
2,177 | Medley Capital Corp.(c) | 28,388 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
3,174 | Mid-America Apartment Communities, Inc. REIT | $ | 221,069 | |||||
4,946 | MSCI, Inc.(b) | 200,511 | ||||||
615 | Nationstar Mortgage Holdings, Inc.(b)(c) | 20,129 | ||||||
5,209 | New York Mortgage Trust, Inc. REIT | 38,390 | ||||||
972 | Northfield Bancorp, Inc. | 12,607 | ||||||
11,251 | NorthStar Realty Finance Corp. REIT | 180,241 | ||||||
4,236 | Ocwen Financial Corp.(b) | 160,544 | ||||||
6,491 | OMEGA Healthcare Investors, Inc. REIT(c) | 225,757 | ||||||
2,775 | Oritani Financial Corp. | 41,153 | ||||||
1,822 | Park Sterling Corp. | 11,898 | ||||||
2,957 | Pebblebrook Hotel Trust REIT | 101,839 | ||||||
6,296 | PennyMac Mortgage Investment Trust REIT | 147,578 | ||||||
2,059 | Portfolio Recovery Associates, Inc.(b) | 117,672 | ||||||
673 | Regional Management Corp.(b) | 10,324 | ||||||
3,004 | Retail Opportunity Investments Corp. REIT | 46,983 | ||||||
8,121 | RLJ Lodging Trust REIT | 216,587 | ||||||
1,594 | Signature Bank(b) | 189,399 | ||||||
1,503 | STAG Industrial, Inc. REIT | 35,366 | ||||||
10,947 | Starwood Property Trust, Inc. REIT | 263,275 | ||||||
3,953 | Stifel Financial Corp.(b) | 184,882 | ||||||
2,245 | Sun Communities, Inc. REIT | 102,305 | ||||||
2,042 | SVB Financial Group(b) | 217,861 | ||||||
4,340 | Tanger Factory Outlet Centers, Inc. REIT | 154,851 | ||||||
524 | Tejon Ranch Co.(b) | 16,249 | ||||||
905 | Terreno Realty Corp. REIT | 16,534 | ||||||
1,756 | Texas Capital Bancshares, Inc.(b) | 98,670 | ||||||
27,944 | Two Harbors Investment Corp. REIT | 290,059 | ||||||
1,863 | ViewPoint Financial Group, Inc. | 48,568 | ||||||
175 | Virtus Investment Partners, Inc.(b) | 32,373 | ||||||
3,517 | Waddell & Reed Financial, Inc., Class A | 237,222 | ||||||
3,126 | Walter Investment Management Corp.(b)(c) | 83,089 | ||||||
406 | Westwood Holdings Group, Inc. | 23,617 | ||||||
1,491 | Whitestone REIT | 20,919 | ||||||
|
| |||||||
7,885,864 | ||||||||
|
| |||||||
Health Care—11.0% | ||||||||
630 | Abaxis, Inc.(b) | 25,584 | ||||||
456 | Abiomed, Inc.(b) | 10,803 | ||||||
574 | Acadia Healthcare Co., Inc.(b) | 24,119 | ||||||
2,489 | Accuray, Inc.(b) | 20,908 | ||||||
1,001 | Acorda Therapeutics, Inc.(b) | 35,485 | ||||||
1,554 | Air Methods Corp.(b) | 86,511 | ||||||
806 | Akorn, Inc.(b) | 20,327 | ||||||
1,276 | Align Technology, Inc.(b) | 64,298 | ||||||
9,483 | Allscripts Healthcare Solutions, Inc.(b) | 144,331 | ||||||
679 | AMAG Pharmaceuticals, Inc.(b) | 12,398 | ||||||
399 | Anika Therapeutics, Inc.(b) | 17,053 | ||||||
862 | Auxilium Pharmaceuticals, Inc.(b) | 19,404 | ||||||
1,748 | Bio-Reference Labs, Inc.(b)(c) | 44,399 | ||||||
869 | Cantel Medical Corp. | 28,816 | ||||||
560 | Cepheid, Inc.(b) | 24,349 | ||||||
703 | Chindex International, Inc.(b) | 16,752 | ||||||
1,723 | Cooper Cos., Inc. (The) | 227,281 | ||||||
1,232 | CryoLife, Inc. | 11,187 | ||||||
2,029 | Cubist Pharmaceuticals, Inc.(b) | 142,152 | ||||||
511 | Cyberonics, Inc.(b) | 30,231 | ||||||
1,456 | Ensign Group, Inc. (The) | 61,880 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 60 |
|
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
957 | ExamWorks Group, Inc.(b) | $ | 35,218 | |||||
3,569 | Exelixis, Inc.(b)(c) | 12,634 | ||||||
1,914 | Globus Medical, Inc., Class A(b) | 46,740 | ||||||
400 | HealthStream, Inc.(b) | 9,060 | ||||||
3,129 | HMS Holdings Corp.(b) | 50,596 | ||||||
1,785 | Idenix Pharmaceuticals, Inc.(b) | 9,835 | ||||||
1,313 | IDEXX Laboratories, Inc.(b) | 166,016 | ||||||
1,736 | Infinity Pharmaceuticals, Inc.(b) | 16,961 | ||||||
833 | IPC The Hospitalist Co., Inc.(b) | 33,736 | ||||||
343 | Isis Pharmaceuticals, Inc.(b) | 9,127 | ||||||
1,503 | Luminex Corp.(b) | 28,873 | ||||||
3,549 | Masimo Corp.(b) | 94,971 | ||||||
3,953 | MedAssets, Inc.(b) | 90,247 | ||||||
2,378 | Medicines Co. (The)(b) | 63,255 | ||||||
368 | Medidata Solutions, Inc.(b) | 13,362 | ||||||
5,777 | Merge Healthcare, Inc.(b) | 13,172 | ||||||
1,613 | Momenta Pharmaceuticals, Inc.(b) | 18,420 | ||||||
608 | MWI Veterinary Supply, Inc.(b) | 95,237 | ||||||
2,823 | Myriad Genetics, Inc.(b)(c) | 119,159 | ||||||
1,302 | Natus Medical, Inc.(b) | 32,329 | ||||||
791 | Neogen Corp.(b) | 33,044 | ||||||
687 | Neurocrine Biosciences, Inc.(b) | 9,632 | ||||||
1,972 | NuVasive, Inc.(b) | 66,476 | ||||||
1,440 | NxStage Medical, Inc.(b) | 16,474 | ||||||
2,682 | PAREXEL International Corp.(b) | 121,629 | ||||||
783 | PhotoMedex, Inc.(b) | 11,831 | ||||||
371 | Premier, Inc., Class A(b) | 11,130 | ||||||
505 | Questcor Pharmaceuticals, Inc. | 41,501 | ||||||
5,195 | ResMed, Inc.(c) | 258,971 | ||||||
753 | Salix Pharmaceuticals Ltd.(b) | 82,830 | ||||||
3,455 | SciClone Pharmaceuticals, Inc.(b) | 16,515 | ||||||
323 | Seattle Genetics, Inc.(b) | 12,429 | ||||||
524 | Spectranetics Corp.(b) | 11,140 | ||||||
2,490 | Spectrum Pharmaceuticals, Inc.(b)(c) | 17,106 | ||||||
3,224 | Targacept, Inc.(b) | 14,315 | ||||||
2,719 | Team Health Holdings, Inc.(b) | 131,817 | ||||||
1,251 | Techne Corp. | 111,727 | ||||||
2,377 | Thoratec Corp.(b) | 77,918 | ||||||
1,366 | United Therapeutics Corp.(b) | 136,614 | ||||||
726 | US Physical Therapy, Inc. | 22,397 | ||||||
450 | Vascular Solutions, Inc.(b) | 9,859 | ||||||
2,450 | Volcano Corp.(b) | 43,022 | ||||||
|
| |||||||
3,285,593 | ||||||||
|
| |||||||
Industrials—13.3% | ||||||||
3,908 | Acacia Research Corp.(c) | 62,684 | ||||||
725 | Advisory Board Co. (The)(b) | 41,513 | ||||||
6,216 | Air Lease Corp. | 222,968 | ||||||
737 | Allegiant Travel Co. | 86,561 | ||||||
3,973 | Allison Transmission Holdings, Inc. | 118,554 | ||||||
563 | Argan, Inc. | 15,072 | ||||||
369 | Astronics Corp.(b) | 21,077 | ||||||
1,412 | AZZ, Inc. | 61,309 | ||||||
1,283 | Chart Industries, Inc.(b) | 87,526 | ||||||
3,905 | Clean Harbors, Inc.(b) | 234,300 | ||||||
2,297 | Colfax Corp.(b) | 165,338 | ||||||
443 | DXP Enterprises, Inc.(b) | 50,152 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
1,537 | Echo Global Logistics, Inc.(b) | $ | 30,064 | |||||
1,007 | EnerNOC, Inc.(b) | 23,765 | ||||||
1,922 | Genesee & Wyoming, Inc., Class A(b) | 190,297 | ||||||
1,281 | HEICO Corp. | 70,865 | ||||||
651 | Heritage-Crystal Clean, Inc.(b) | 10,416 | ||||||
4,287 | Hexcel Corp.(b) | 178,725 | ||||||
736 | Hyster-Yale Materials Handling, Inc. | 70,943 | ||||||
1,210 | KEYW Holding Corp. (The)(b) | 15,548 | ||||||
2,614 | Kirby Corp.(b) | 263,021 | ||||||
522 | Lindsay Corp.(c) | 46,004 | ||||||
753 | Manitex International, Inc.(b) | 12,394 | ||||||
4,958 | MasTec, Inc.(b) | 196,238 | ||||||
472 | Middleby Corp. (The)(b) | 119,171 | ||||||
994 | Mistras Group, Inc.(b) | 22,574 | ||||||
1,022 | Multi-Color Corp. | 35,617 | ||||||
3,220 | Old Dominion Freight Line, Inc.(b) | 195,229 | ||||||
2,377 | On Assignment, Inc.(b) | 83,195 | ||||||
7,184 | Pendrell Corp.(b) | 11,854 | ||||||
1,642 | Performant Financial Corp.(b) | 14,302 | ||||||
1,615 | �� | Primoris Services Corp. | 45,188 | |||||
202 | Proto Labs, Inc.(b) | 12,229 | ||||||
1,760 | Raven Industries, Inc. | 54,384 | ||||||
2,308 | Roadrunner Transportation Systems, Inc.(b) | 56,846 | ||||||
2,185 | Rollins, Inc. | 65,725 | ||||||
2,548 | RPX Corp.(b) | 41,736 | ||||||
2,397 | Spirit Airlines, Inc.(b) | 136,245 | ||||||
951 | Sun Hydraulics Corp. | 38,877 | ||||||
4,335 | Triumph Group, Inc. | 280,951 | ||||||
1,462 | Valmont Industries, Inc. | 217,706 | ||||||
331 | WageWorks, Inc.(b) | 14,024 | ||||||
5,514 | Waste Connections, Inc. | 246,255 | ||||||
762 | XPO Logistics, Inc.(b) | 20,681 | ||||||
|
| |||||||
3,988,123 | ||||||||
|
| |||||||
Information Technology—21.8% | ||||||||
1,396 | ACI Worldwide, Inc.(b) | 79,781 | ||||||
1,280 | Advent Software, Inc. | 36,890 | ||||||
397 | Ambarella Inc.(b) | 9,865 | ||||||
2,273 | Aruba Networks, Inc.(b) | 44,937 | ||||||
1,755 | Bankrate, Inc. (United Kingdom)(b) | 30,748 | ||||||
1,889 | Bazaarvoice, Inc.(b) | 12,694 | ||||||
508 | Blackhawk Network Holdings, Inc.(b) | 12,187 | ||||||
2,054 | Blucora, Inc.(b) | 39,539 | ||||||
990 | Bottomline Technologies, Inc.(b) | 31,324 | ||||||
636 | BroadSoft, Inc.(b) | 16,142 | ||||||
472 | CalAmp Corp.(b) | 8,378 | ||||||
3,036 | Calix, Inc.(b) | 26,747 | ||||||
1,746 | Cardtronics, Inc.(b) | 58,456 | ||||||
677 | Cavium, Inc.(b) | 28,684 | ||||||
1,059 | CEVA, Inc.(b) | 17,188 | ||||||
4,360 | Cirrus Logic, Inc.(b) | 97,228 | ||||||
2,132 | Cognex Corp.(b) | 73,405 | ||||||
719 | CommVault Systems, Inc.(b) | 34,800 | ||||||
778 | comScore, Inc.(b) | 24,375 | ||||||
517 | Concur Technologies, Inc.(b) | 41,603 | ||||||
924 | Constant Contact, Inc.(b) | 23,895 | ||||||
431 | CoStar Group, Inc.(b) | 69,344 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 61 |
|
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
1,145 | Cray, Inc.(b) | $ | 32,873 | |||||
1,564 | Datalink Corp.(b) | 20,082 | ||||||
2,111 | Ebix, Inc. | 33,312 | ||||||
514 | Ellie Mae, Inc.(b) | 12,536 | ||||||
340 | Envestnet, Inc.(b) | 12,529 | ||||||
740 | EPAM Systems, Inc.(b) | 23,036 | ||||||
1,894 | ExlService Holdings, Inc.(b) | 53,591 | ||||||
1,489 | FactSet Research Systems, Inc.(c) | 158,578 | ||||||
915 | FEI Co. | 72,761 | ||||||
4,660 | Finisar Corp.(b) | 121,859 | ||||||
7,405 | FLIR Systems, Inc. | 252,066 | ||||||
2,486 | Fortinet, Inc.(b) | 54,642 | ||||||
3,097 | Fusion-io, Inc.(b) | 26,727 | ||||||
2,066 | Gartner, Inc.(b) | 142,430 | ||||||
6,448 | GT Advanced Technologies, Inc.(b)(c) | 107,101 | ||||||
412 | Guidewire Software, Inc.(b) | 15,557 | ||||||
1,787 | Higher One Holdings, Inc.(b) | 10,704 | ||||||
1,352 | Hittite Microwave Corp. | 80,255 | ||||||
2,825 | IAC/InterActiveCorp. | 187,241 | ||||||
789 | iGATE Corp.(b) | 28,877 | ||||||
710 | Infoblox, Inc.(b) | 13,930 | ||||||
3,629 | Informatica Corp.(b) | 128,648 | ||||||
879 | Inphi Corp.(b) | 13,000 | ||||||
237 | Interactive Intelligence Group, Inc.(b) | 14,829 | ||||||
3,702 | InterDigital, Inc. | 128,533 | ||||||
1,136 | InvenSense, Inc.(b) | 24,458 | ||||||
806 | IPG Photonics Corp.(b) | 52,092 | ||||||
3,548 | Ixia(b) | 44,066 | ||||||
1,525 | j2 Global, Inc. | 70,699 | ||||||
3,100 | Jack Henry & Associates, Inc. | 170,996 | ||||||
1,420 | Liquidity Services, Inc.(b) | 24,495 | ||||||
864 | Littelfuse, Inc. | 78,235 | ||||||
1,579 | LivePerson, Inc.(b) | 15,632 | ||||||
474 | LogMeIn, Inc.(b) | 21,543 | ||||||
1,886 | MAXIMUS, Inc. | 80,287 | ||||||
1,547 | Maxwell Technologies, Inc.(b) | 23,298 | ||||||
3,141 | MICROS Systems, Inc.(b) | 161,761 | ||||||
5,577 | Microsemi Corp.(b) | 131,171 | ||||||
968 | Monolithic Power Systems, Inc.(b) | 35,913 | ||||||
883 | Monotype Imaging Holdings, Inc. | 23,320 | ||||||
1,826 | NeoPhotonics Corp.(b) | 10,536 | ||||||
1,365 | Netscout Systems, Inc.(b) | 53,180 | ||||||
2,244 | NIC, Inc. | 41,155 | ||||||
16,271 | Nuance Communications, Inc.(b) | 261,800 | ||||||
199 | NVE Corp.(b) | 10,449 | ||||||
291 | OpenTable, Inc.(b) | 19,544 | ||||||
1,181 | OSI Systems, Inc.(b) | 65,912 | ||||||
210 | Palo Alto Networks, Inc.(b) | 13,352 | ||||||
335 | Pandora Media, Inc.(b) | 7,846 | ||||||
770 | Pegasystems, Inc. | 12,759 | ||||||
717 | Power Integrations, Inc. | 33,864 | ||||||
935 | Procera Networks, Inc.(b) | 8,658 | ||||||
1,036 | QLIK Technologies, Inc.(b) | 22,771 | ||||||
3,932 | Rackspace Hosting, Inc.(b) | 114,107 | ||||||
1,840 | RealD, Inc.(b) | 20,166 | ||||||
1,057 | RealPage, Inc.(b) | 18,762 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
5,059 | Riverbed Technology, Inc.(b) | $ | 98,398 | |||||
7,973 | Rovi Corp.(b) | 177,718 | ||||||
1,018 | Ruckus Wireless, Inc.(b) | 10,638 | ||||||
5,469 | Sapient Corp.(b) | 88,981 | ||||||
2,209 | ShoreTel, Inc.(b) | 16,678 | ||||||
7,990 | Skyworks Solutions, Inc.(b) | 327,990 | ||||||
1,061 | SolarWinds, Inc.(b) | 42,780 | ||||||
1,927 | Solera Holdings, Inc. | 124,831 | ||||||
198 | SPS Commerce, Inc.(b) | 10,256 | ||||||
2,646 | SS&C Technologies Holdings, Inc.(b) | 102,982 | ||||||
410 | Stamps.com, Inc.(b) | 14,231 | ||||||
801 | Stratasys Ltd.(b)(c) | 77,593 | ||||||
2,407 | Super Micro Computer, Inc.(b) | 49,007 | ||||||
1,062 | Synaptics, Inc.(b) | 66,003 | ||||||
1,033 | Synchronoss Technologies, Inc.(b) | 31,445 | ||||||
551 | Syntel, Inc.(b) | 44,256 | ||||||
786 | Tangoe, Inc.(b) | 11,821 | ||||||
2,661 | TiVo, Inc.(b) | 31,559 | ||||||
386 | Tyler Technologies, Inc.(b) | 31,517 | ||||||
141 | Ultimate Software Group, Inc. (The)(b) | 16,868 | ||||||
1,544 | Ultratech, Inc.(b) | 41,101 | ||||||
682 | Universal Display Corp.(b) | 17,766 | ||||||
4,049 | Vantiv, Inc., Class A(b) | 124,507 | ||||||
6,547 | VeriFone Systems, Inc.(b) | 218,932 | ||||||
1,619 | Verint Systems, Inc.(b) | 70,864 | ||||||
1,903 | ViaSat, Inc.(b) | 122,192 | ||||||
867 | Virtusa Corp.(b) | 28,585 | ||||||
627 | Web.com Group, Inc.(b) | 19,255 | ||||||
1,456 | WEX, Inc.(b) | 139,732 | ||||||
127 | Yelp, Inc., Class A(b) | 7,407 | ||||||
175 | Zillow, Inc., Class A(b) | 19,023 | ||||||
23,573 | Zynga, Inc., Class A(b) | 95,471 | ||||||
|
| |||||||
6,517,121 | ||||||||
|
| |||||||
Materials—3.2% | ||||||||
8,903 | Allied Nevada Gold Corp.(b)(c) | 30,181 | ||||||
1,242 | American Vanguard Corp. | 22,120 | ||||||
780 | Balchem Corp. | 48,321 | ||||||
1,166 | Flotek Industries, Inc.(b) | 32,660 | ||||||
3,330 | Globe Specialty Metals, Inc. | 64,535 | ||||||
4,482 | Gold Resource Corp. | 20,662 | ||||||
29,567 | Hecla Mining Co.(c) | 90,771 | ||||||
2,707 | KapStone Paper and Packaging Corp.(b) | 71,411 | ||||||
11,656 | Molycorp, Inc.(b)(c) | 55,366 | ||||||
2,080 | Royal Gold, Inc. | 137,696 | ||||||
5,770 | Tronox Ltd., Class A | 141,365 | ||||||
2,191 | US Silica Holdings, Inc. | 98,967 | ||||||
1,867 | Westlake Chemical Corp. | 132,930 | ||||||
|
| |||||||
946,985 | ||||||||
|
| |||||||
Telecommunication Services—0.2% | ||||||||
1,404 | 8x8, Inc.(b) | 13,619 | ||||||
2,041 | Boingo Wireless, Inc.(b) | 13,471 | ||||||
756 | Cogent Communications Group, Inc. | 26,059 | ||||||
1,676 | ORBCOMM, Inc.(b) | 10,508 | ||||||
|
| |||||||
63,657 | ||||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 62 |
|
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Utilities—1.1% | ||||||||
7,595 | ITC Holdings Corp. | $ | 280,787 | |||||
682 | NRG Yield, Inc., Class A | 29,217 | ||||||
517 | Pattern Energy Group, Inc. | 13,856 | ||||||
|
| |||||||
323,860 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $26,156,344) | 29,871,276 | |||||||
|
| |||||||
Warrant—0.0% | ||||||||
Energy—0.0% | ||||||||
637 | Magnum Hunter Resources Corp., expiring 05/15/16(b) (Cost $0) | 0 | ||||||
|
| |||||||
Money Market Fund—0.2% | ||||||||
49,638 | Invesco Premier Portfolio—Institutional Class(d) (Cost $49,638) | 49,638 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $26,205,982)—100.1% | 29,920,914 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—4.0% | ||||||||
1,186,531 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $1,186,531) | 1,186,531 | ||||||
|
| |||||||
Total Investments (Cost $27,392,513)—104.1% | 31,107,445 | |||||||
Other assets less liabilities—(4.1)% | (1,235,234 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 29,872,211 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 1,165,981 | $ | (1,165,981 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 63 |
|
Schedule of Investments(a)
PowerShares Fundamental Pure Small Value Portfolio (PXSV)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—99.9% | ||||||||
Consumer Discretionary—17.8% | ||||||||
3,431 | 1-800-FLOWERS.COM, Inc., Class A(b) | $ | 18,699 | |||||
25,482 | Aeropostale, Inc.(b)(c) | 126,646 | ||||||
2,326 | AH Belo Corp., Class A | 26,772 | ||||||
2,016 | AMC Entertainment Holdings, Inc., Class A (China)(b) | 46,650 | ||||||
3,452 | American Axle & Manufacturing Holdings, Inc.(b) | 60,928 | ||||||
4,417 | ANN, Inc.(b) | 173,102 | ||||||
5,007 | ARAMARK Holdings Corp. | 141,147 | ||||||
687 | Arctic Cat, Inc. | 28,091 | ||||||
2,782 | Asbury Automotive Group, Inc.(b) | 171,761 | ||||||
870 | Ascent Capital Group, Inc., Class A(b) | 59,830 | ||||||
11,172 | Barnes & Noble, Inc.(b) | 183,221 | ||||||
1,663 | Bassett Furniture Industries, Inc. | 22,933 | ||||||
2,830 | Beazer Homes USA, Inc.(b) | 53,657 | ||||||
5,694 | bebe Stores, Inc. | 28,755 | ||||||
2,534 | Big 5 Sporting Goods Corp. | 30,940 | ||||||
122 | Biglari Holdings, Inc.(b) | 52,340 | ||||||
546 | Blue Nile, Inc.(b) | 18,963 | ||||||
2,710 | Blyth, Inc.(c) | 25,393 | ||||||
2,614 | Bob Evans Farms, Inc. | 122,518 | ||||||
9,575 | Bon-Ton Stores, Inc. (The)(c) | 105,325 | ||||||
10,128 | Boyd Gaming Corp.(b) | 119,713 | ||||||
4,554 | Brinker International, Inc. | 223,784 | ||||||
4,997 | Brown Shoe Co., Inc. | 117,879 | ||||||
3,406 | Brunswick Corp. | 136,887 | ||||||
1,992 | Build-A-Bear Workshop, Inc.(b) | 22,350 | ||||||
2,545 | Burger King Worldwide, Inc. | 66,501 | ||||||
4,091 | Burlington Stores, Inc.(b) | 106,325 | ||||||
5,932 | Callaway Golf Co. | 51,668 | ||||||
24,370 | Career Education Corp.(b) | 175,951 | ||||||
1,234 | Carmike Cinemas, Inc.(b) | 36,600 | ||||||
3,566 | Cato Corp. (The), Class A | 101,595 | ||||||
2,675 | Children’s Place Retail Stores, Inc. (The) | 128,400 | ||||||
3,965 | Christopher & Banks Corp.(b) | 24,742 | ||||||
2,573 | Citi Trends, Inc.(b) | 43,715 | ||||||
7,877 | Clear Channel Outdoor Holdings, Inc., Class A | 63,174 | ||||||
1,238 | ClubCorp Holdings, Inc. | 23,324 | ||||||
845 | Columbia Sportswear Co. | 72,653 | ||||||
8,584 | Cooper Tire & Rubber Co. | 215,888 | ||||||
764 | Cooper-Standard Holding, Inc.(b) | 51,761 | ||||||
5,861 | Crocs, Inc.(b) | 88,677 | ||||||
1,285 | CSS Industries, Inc. | 30,801 | ||||||
6,640 | Denny’s Corp.(b) | 44,754 | ||||||
1,069 | Destination Maternity Corp. | 26,362 | ||||||
4,315 | Destination XL Group, Inc.(b) | 23,301 | ||||||
820 | Dixie Group, Inc. (The)(b) | 12,357 | ||||||
3,332 | DreamWorks Animation SKG, Inc., Class A(b) | 80,068 | ||||||
2,307 | E.W. Scripps Co. (The), Class A(b) | 39,519 | ||||||
5,228 | Education Management Corp.(b)(c) | 20,755 | ||||||
2,036 | Einstein Noah Restaurant Group, Inc. | 31,273 | ||||||
2,814 | Entercom Communications Corp., Class A(b) | 30,391 | ||||||
2,265 | Ethan Allen Interiors, Inc. | 54,994 | ||||||
8,288 | Express, Inc.(b) | 120,756 | ||||||
4,725 | Federal-Mogul Corp.(b) | 81,364 | ||||||
496 | Flexsteel Industries, Inc. | 17,023 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
5,219 | Fred’s, Inc., Class A | $ | 95,090 | |||||
2,414 | Fuel Systems Solutions, Inc.(b) | 25,299 | ||||||
2,916 | Gray Television, Inc.(b) | 32,805 | ||||||
3,713 | Group 1 Automotive, Inc. | 267,819 | ||||||
9,258 | Harte-Hanks, Inc. | 74,434 | ||||||
1,358 | Haverty Furniture Cos., Inc. | 34,683 | ||||||
5,531 | hhgregg, Inc.(b)(c) | 47,677 | ||||||
1,396 | Hooker Furniture Corp. | 19,335 | ||||||
9,795 | Hovnanian Enterprises, Inc., Class A(b)(c) | 43,686 | ||||||
2,930 | Hyatt Hotels Corp., Class A(b) | 164,900 | ||||||
2,355 | International Speedway Corp., Class A | 74,041 | ||||||
5,234 | Isle of Capri Casinos, Inc.(b) | 35,591 | ||||||
5,183 | ITT Educational Services, Inc.(b) | 139,941 | ||||||
2,996 | Jack in the Box, Inc.(b) | 160,406 | ||||||
2,749 | John Wiley & Sons, Inc., Class A | 157,958 | ||||||
3,800 | Journal Communications, Inc., Class A(b) | 30,476 | ||||||
2,413 | Kate Spade & Co.(b) | 83,900 | ||||||
5,534 | KB Home | 91,366 | ||||||
3,487 | Lamar Advertising Co., Class A(b) | 174,071 | ||||||
13,712 | Lee Enterprises, Inc.(b)(c) | 55,122 | ||||||
1,785 | Libbey, Inc.(b) | 47,606 | ||||||
1,346 | Lifetime Brands, Inc. | 25,709 | ||||||
1,694 | Lithia Motors, Inc., Class A | 125,830 | ||||||
1,822 | Loral Space & Communications, Inc.(b) | 131,166 | ||||||
2,054 | Luby’s, Inc.(b) | 11,133 | ||||||
1,316 | M/I Homes, Inc.(b) | 29,307 | ||||||
2,781 | Marcus Corp. (The) | 46,526 | ||||||
2,516 | MarineMax, Inc.(b) | 40,407 | ||||||
2,671 | Marriott Vacations Worldwide Corp.(b) | 145,516 | ||||||
1,966 | Matthews International Corp., Class A | 79,328 | ||||||
16,124 | McClatchy Co. (The), Class A(b) | 88,360 | ||||||
3,991 | MDC Holdings, Inc. | 110,152 | ||||||
1,826 | Media General, Inc.(b)(c) | 27,974 | ||||||
3,996 | Men’s Wearhouse, Inc. (The) | 189,330 | ||||||
3,397 | Meredith Corp. | 149,706 | ||||||
1,822 | Meritage Homes Corp.(b) | 70,293 | ||||||
4,842 | Modine Manufacturing Co.(b) | 79,796 | ||||||
809 | Monarch Casino & Resort, Inc.(b) | 12,976 | ||||||
1,386 | Morgans Hotel Group Co.(b) | 10,395 | ||||||
872 | NACCO Industries, Inc., Class A | 46,730 | ||||||
1,286 | Nautilus, Inc.(b) | 10,712 | ||||||
5,075 | New York & Co., Inc.(b) | 21,264 | ||||||
10,328 | New York Times Co. (The), Class A | 166,074 | ||||||
3,205 | Nutrisystem, Inc. | 48,075 | ||||||
3,458 | Orbitz Worldwide, Inc.(b) | 25,416 | ||||||
9,835 | Pacific Sunwear of California, Inc.(b) | 28,325 | ||||||
5,214 | Penske Automotive Group, Inc. | 239,114 | ||||||
8,655 | Pep Boys-Manny, Moe & Jack (The)(b) | 88,454 | ||||||
3,562 | Perry Ellis International, Inc.(b) | 53,786 | ||||||
2,402 | PetMed Express, Inc. | 31,442 | ||||||
4,755 | Pinnacle Entertainment, Inc.(b) | 110,649 | ||||||
14,699 | Quiksilver, Inc.(b) | 94,368 | ||||||
4,800 | Radio One, Inc., Class D(b) | 21,696 | ||||||
95,227 | RadioShack Corp.(b)(c) | 136,175 | ||||||
1,647 | Reading International, Inc., Class A(b) | 11,661 | ||||||
969 | Red Robin Gourmet Burgers, Inc.(b) | 65,873 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 64 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
12,727 | Regal Entertainment Group, Class A(c) | $ | 239,268 | |||||
9,636 | Regis Corp. | 126,617 | ||||||
17,883 | Ruby Tuesday, Inc.(b) | 137,878 | ||||||
2,243 | Ruth’s Hospitality Group, Inc. | 28,239 | ||||||
1,626 | Ryland Group, Inc. (The) | 62,422 | ||||||
370 | Saga Communications, Inc., Class A | 16,391 | ||||||
1,351 | Salem Communications Corp., Class A | 11,902 | ||||||
3,532 | Scholastic Corp. | 116,238 | ||||||
4,810 | Scientific Games Corp., Class A(b) | 57,624 | ||||||
3,197 | Sears Hometown and Outlet Stores, Inc.(b) | 75,481 | ||||||
770 | Shiloh Industries, Inc.(b) | 15,200 | ||||||
2,916 | Skechers U.S.A., Inc., Class A(b) | 119,527 | ||||||
8,335 | Sonic Automotive, Inc., Class A | 202,874 | ||||||
3,342 | Sonic Corp.(b) | 63,632 | ||||||
4,703 | Spartan Motors, Inc. | 24,973 | ||||||
1,629 | Speedway Motorsports, Inc. | 29,632 | ||||||
4,965 | Stage Stores, Inc. | 95,229 | ||||||
3,394 | Stein Mart, Inc. | 42,425 | ||||||
4,155 | Stoneridge, Inc.(b) | 44,417 | ||||||
2,741 | Strayer Education, Inc.(b)(c) | 116,849 | ||||||
3,738 | Superior Industries International, Inc. | 79,021 | ||||||
1,527 | Systemax, Inc.(b) | 26,402 | ||||||
1,717 | Tempur Sealy International, Inc.(b) | 86,159 | ||||||
3,129 | Thor Industries, Inc. | 190,462 | ||||||
6,534 | Toll Brothers, Inc.(b) | 223,724 | ||||||
4,600 | Tower International, Inc.(b) | 127,926 | ||||||
3,914 | Town Sports International Holdings, Inc. | 27,437 | ||||||
17,261 | TravelCenters of America LLC(b) | 130,666 | ||||||
3,676 | Tuesday Morning Corp.(b) | 51,390 | ||||||
1,904 | Unifi, Inc.(b) | 42,155 | ||||||
2,843 | Universal Technical Institute, Inc. | 34,144 | ||||||
3,595 | ValueVision Media, Inc., Class A(b) | 16,825 | ||||||
3,809 | VOXX International Corp.(b) | 44,756 | ||||||
4,556 | Weight Watchers International, Inc. (Luxembourg)(c) | 90,209 | ||||||
21,387 | Wendy’s Co. (The) | 177,726 | ||||||
2,637 | West Marine, Inc.(b) | 28,216 | ||||||
19,960 | Wet Seal, Inc. (The), Class A(b)(c) | 22,555 | ||||||
782 | Weyco Group, Inc. | 19,620 | ||||||
1,040 | Winnebago Industries, Inc.(b) | 24,856 | ||||||
2,184 | World Wrestling Entertainment, Inc., Class A | 42,588 | ||||||
5,419 | Zale Corp.(b) | 115,912 | ||||||
|
| |||||||
11,642,467 | ||||||||
|
| |||||||
Consumer Staples—3.1% | ||||||||
19,797 | Alliance One International, Inc.(b) | 50,878 | ||||||
1,152 | Cal-Maine Foods, Inc. | 68,694 | ||||||
13,753 | Central Garden & Pet Co., Class A(b) | 113,737 | ||||||
15,578 | Chiquita Brands International, Inc.(b) | 178,836 | ||||||
645 | Coca-Cola Bottling Co. Consolidated | 53,038 | ||||||
2,893 | Elizabeth Arden, Inc.(b) | 106,289 | ||||||
6,504 | Fresh Del Monte Produce, Inc. | 187,901 | ||||||
4,412 | Ingles Markets, Inc., Class A | 101,432 | ||||||
1,175 | John B. Sanfilippo & Son, Inc. | 27,084 | ||||||
1,350 | National Beverage Corp.(b) | 26,028 | ||||||
872 | Nutraceutical International Corp.(b) | 21,730 | ||||||
393 | Oil-Dri Corp. of America | 13,169 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Staples (continued) | ||||||||
2,380 | Omega Protein Corp.(b) | $ | 27,037 | |||||
3,269 | Pilgrim’s Pride Corp. (Brazil)(b) | 71,460 | ||||||
2,908 | Post Holdings, Inc.(b) | 151,972 | ||||||
1,053 | Revlon, Inc., Class A(b) | 31,737 | ||||||
17,424 | Roundy’s, Inc. | 117,961 | ||||||
1,228 | Seneca Foods Corp., Class A(b) | 34,875 | ||||||
5,099 | Spartan Stores, Inc. | 109,833 | ||||||
4,096 | Universal Corp. | 223,519 | ||||||
7,113 | Vector Group Ltd.(c) | 151,507 | ||||||
1,091 | Village Super Market, Inc., Class A | 26,391 | ||||||
704 | WD-40 Co. | 51,279 | ||||||
1,585 | Weis Markets, Inc. | 73,053 | ||||||
|
| |||||||
2,019,440 | ||||||||
|
| |||||||
Energy—5.7% | ||||||||
3,713 | Abraxas Petroleum Corp.(b) | 20,273 | ||||||
501 | Adams Resources & Energy, Inc. | 36,102 | ||||||
5,230 | Alon USA Energy, Inc. (Israel) | 85,197 | ||||||
5,214 | Basic Energy Services, Inc.(b) | 137,754 | ||||||
7,084 | Bill Barrett Corp.(b) | 167,749 | ||||||
28,548 | Cal Dive International, Inc.(b)(c) | 42,251 | ||||||
4,512 | Callon Petroleum Co.(b) | 41,420 | ||||||
10,283 | Cloud Peak Energy, Inc.(b) | 202,472 | ||||||
5,833 | Comstock Resources, Inc. | 162,157 | ||||||
1,968 | CVR Energy, Inc. | 96,727 | ||||||
1,070 | Dawson Geophysical Co. | 30,238 | ||||||
3,547 | Endeavour International Corp.(b)(c) | 12,202 | ||||||
3,137 | Ep Energy Corp., Class A(b) | 60,952 | ||||||
4,616 | Equal Energy Ltd. | 20,911 | ||||||
15,677 | EXCO Resources, Inc.(c) | 99,549 | ||||||
49,608 | Forest Oil Corp.(b) | 92,271 | ||||||
1,509 | Gulf Island Fabrication, Inc. | 30,271 | ||||||
4,908 | Harvest Natural Resources, Inc.(b)(c) | 22,135 | ||||||
9,338 | Helix Energy Solutions Group, Inc.(b) | 224,486 | ||||||
27,935 | Hercules Offshore, Inc.(b) | 124,869 | ||||||
2,783 | Hornbeck Offshore Services, Inc.(b) | 115,300 | ||||||
15,065 | ION Geophysical Corp.(b) | 66,286 | ||||||
21,668 | Key Energy Services, Inc.(b) | 217,547 | ||||||
1,648 | Mitcham Industries, Inc.(b) | 22,742 | ||||||
7,655 | Newpark Resources, Inc.(b) | 92,166 | ||||||
14,706 | Parker Drilling Co.(b) | 97,501 | ||||||
7,314 | Penn Virginia Corp.(b) | 121,705 | ||||||
7,386 | PetroQuest Energy, Inc.(b) | 44,464 | ||||||
1,164 | PHI, Inc.(b) | 52,147 | ||||||
9,468 | Pioneer Energy Services Corp.(b) | 141,736 | ||||||
27,709 | Quicksilver Resources, Inc.(b)(c) | 90,331 | ||||||
4,724 | Stone Energy Corp.(b) | 231,712 | ||||||
11,765 | Swift Energy Co.(b) | 145,062 | ||||||
2,556 | Tesco Corp.(b) | 51,120 | ||||||
9,284 | TETRA Technologies, Inc.(b) | 116,050 | ||||||
4,003 | Ultra Petroleum Corp.(b) | 119,289 | ||||||
5,484 | VAALCO Energy, Inc.(b) | 50,563 | ||||||
5,642 | W&T Offshore, Inc. | 108,326 | ||||||
6,707 | Warren Resources, Inc.(b) | 34,005 | ||||||
8,533 | Willbros Group, Inc.(b) | 94,802 | ||||||
|
| |||||||
3,722,840 | ||||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 65 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials—23.9% | ||||||||
1,117 | 1st Source Corp. | $ | 32,940 | |||||
6,288 | AG Mortgage Investment Trust, Inc. REIT | 111,235 | ||||||
2,118 | Alexander & Baldwin, Inc. | 79,023 | ||||||
965 | American National Bankshares, Inc. | 20,564 | ||||||
1,127 | American Residential Properties, Inc. REIT(b) | 20,252 | ||||||
1,132 | Ameris Bancorp(b) | 24,078 | ||||||
1,113 | AMERISAFE, Inc. | 47,469 | ||||||
868 | Ames National Corp. | 18,948 | ||||||
32,242 | Anworth Mortgage Asset Corp. REIT | 174,107 | ||||||
3,308 | Arbor Realty Trust, Inc. REIT | 23,189 | ||||||
1,055 | Armada Hoffler Properties, Inc. REIT | 10,212 | ||||||
1,307 | Arrow Financial Corp. | 32,714 | ||||||
11,156 | Ashford Hospitality Trust, Inc. REIT | 114,461 | ||||||
12,243 | Astoria Financial Corp. | 162,342 | ||||||
1,278 | Baldwin & Lyons, Inc., Class B | 33,241 | ||||||
494 | BancFirst Corp. | 28,756 | ||||||
7,130 | BancorpSouth, Inc. | 166,557 | ||||||
4,357 | Bank Mutual Corp. | 26,229 | ||||||
3,983 | Bank of Hawaii Corp. | 219,742 | ||||||
1,653 | BankFinancial Corp. | 16,265 | ||||||
1,155 | Banner Corp. | 45,669 | ||||||
342 | Bar Harbor Bankshares | 12,852 | ||||||
659 | BBX Capital Corp., Class A(b) | 12,343 | ||||||
1,980 | Beneficial Mutual Bancorp, Inc.(b) | 25,819 | ||||||
1,083 | Blackstone Mortgage Trust, Inc., Class A REIT | 30,790 | ||||||
1,891 | BOK Financial Corp. | 123,709 | ||||||
4,319 | Boston Private Financial Holdings, Inc. | 54,031 | ||||||
2,237 | Brixmor Property Group, Inc. REIT | 49,124 | ||||||
8,570 | Brookline Bancorp, Inc. | 77,816 | ||||||
4,261 | Calamos Asset Management, Inc., Class A | 51,899 | ||||||
898 | Camden National Corp. | 34,277 | ||||||
1,652 | Capital City Bank Group, Inc. | 22,963 | ||||||
20,423 | Capitol Federal Financial, Inc. | 245,893 | ||||||
15,417 | Capstead Mortgage Corp. REIT | 197,029 | ||||||
3,212 | Cash America International, Inc. | 139,883 | ||||||
4,682 | Cathay General Bancorp | 110,495 | ||||||
8,325 | Cedar Realty Trust, Inc. REIT | 51,532 | ||||||
1,706 | Central Pacific Financial Corp. | 32,022 | ||||||
372 | Century Bancorp, Inc., Class A | 12,462 | ||||||
1,837 | Charter Financial Corp. | 20,207 | ||||||
2,750 | Chemical Financial Corp. | 77,192 | ||||||
1,073 | Citizens & Northern Corp. | 20,108 | ||||||
3,126 | Citizens, Inc.(b) | 20,538 | ||||||
1,412 | City Holding Co. | 60,702 | ||||||
3,219 | City National Corp. | 233,603 | ||||||
2,439 | CNA Financial Corp. | 99,877 | ||||||
2,076 | CoBiz Financial, Inc. | 20,843 | ||||||
1,128 | Cohen & Steers, Inc. | 45,695 | ||||||
1,278 | Community Trust Bancorp, Inc. | 47,120 | ||||||
2,314 | Consumer Portfolio Services, Inc.(b) | 16,152 | ||||||
8,518 | Corporate Office Properties Trust REIT | 227,856 | ||||||
7,513 | Cousins Properties, Inc. REIT | 87,376 | ||||||
3,419 | Crawford & Co., Class B | 39,045 | ||||||
6,548 | CVB Financial Corp. | 94,684 | ||||||
22,770 | DCT Industrial Trust, Inc. REIT | 178,061 | ||||||
13,225 | DFC Global Corp.(b) | 123,257 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
14,991 | DiamondRock Hospitality Co. REIT | $ | 183,940 | |||||
2,974 | Dime Community Bancshares, Inc. | 48,476 | ||||||
1,191 | Donegal Group, Inc., Class A | 17,579 | ||||||
8,241 | Douglas Emmett, Inc. REIT | 227,452 | ||||||
663 | EMC Insurance Group, Inc. | 21,872 | ||||||
2,711 | Employers Holdings, Inc. | 55,169 | ||||||
738 | Enterprise Bancorp, Inc. | 13,476 | ||||||
1,479 | Enterprise Financial Services Corp. | 26,430 | ||||||
3,641 | EPR Properties REIT | 195,194 | ||||||
1,025 | ESB Financial Corp. | 12,935 | ||||||
15,490 | F.N.B. Corp. | 192,696 | ||||||
1,346 | FBL Financial Group, Inc., Class A | 60,180 | ||||||
832 | FBR & Co.(b) | 21,466 | ||||||
958 | Federal Agricultural Mortgage Corp., Class C | 34,086 | ||||||
5,743 | FelCor Lodging Trust, Inc. REIT | 53,008 | ||||||
1,356 | Financial Institutions, Inc. | 31,391 | ||||||
853 | First Bancorp, Inc. | 13,588 | ||||||
1,904 | First Bancorp. | 32,768 | ||||||
7,522 | First Busey Corp. | 41,371 | ||||||
496 | First Citizens BancShares, Inc., Class A | 111,545 | ||||||
10,258 | �� | First Commonwealth Financial Corp. | 88,116 | |||||
1,766 | First Community Bancshares, Inc. | 26,154 | ||||||
1,027 | First Defiance Financial Corp. | 27,749 | ||||||
1,193 | First Financial Corp. | 38,188 | ||||||
1,031 | First Financial Northwest, Inc. | 10,516 | ||||||
1,652 | First Interstate BancSystem, Inc. | 41,118 | ||||||
2,271 | First Merchants Corp. | 48,191 | ||||||
5,734 | First Midwest Bancorp, Inc. | 93,866 | ||||||
5,987 | First Potomac Realty Trust REIT | 78,011 | ||||||
11,365 | FirstMerit Corp. | 220,367 | ||||||
2,121 | Flagstar Bancorp, Inc.(b) | 37,330 | ||||||
2,663 | Flushing Financial Corp. | 51,183 | ||||||
6,245 | Forest City Enterprises, Inc., Class A(b) | 118,093 | ||||||
2,192 | Forestar Group, Inc.(b) | 37,374 | ||||||
7,960 | Franklin Street Properties Corp. REIT | 96,953 | ||||||
19,089 | Fulton Financial Corp. | 232,695 | ||||||
2,543 | FXCM, Inc., Class A | 39,366 | ||||||
289 | GAMCO Investors, Inc., Class A | 21,944 | ||||||
321 | Gaming and Leisure Properties, Inc. REIT | 11,797 | ||||||
2,518 | Getty Realty Corp. REIT | 47,641 | ||||||
12,299 | GFI Group, Inc. | 45,752 | ||||||
4,776 | Glacier Bancorp, Inc. | 122,552 | ||||||
5,300 | Gramercy Property Trust, Inc. REIT(c) | 27,666 | ||||||
1,220 | Great Southern Bancorp, Inc. | 34,977 | ||||||
1,818 | Greenhill & Co., Inc. | 91,173 | ||||||
1,130 | Guaranty Bancorp | 14,227 | ||||||
2,412 | Hallmark Financial Services, Inc.(b) | 20,261 | ||||||
1,484 | Hanmi Financial Corp. | 31,565 | ||||||
1,405 | Heartland Financial USA, Inc. | 34,141 | ||||||
944 | Home Federal Bancorp, Inc. | 14,207 | ||||||
1,315 | HomeTrust Bancshares, Inc.(b) | 20,080 | ||||||
4,413 | Horace Mann Educators Corp. | 132,699 | ||||||
819 | Horizon Bancorp | 16,372 | ||||||
1,650 | Hudson Valley Holding Corp. | 30,294 | ||||||
713 | Independence Holding Co. | 9,312 | ||||||
1,348 | Independent Bank Corp. | 17,551 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 66 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
1,158 | Infinity Property & Casualty Corp. | $ | 74,309 | |||||
7,666 | Inland Real Estate Corp. REIT | 80,110 | ||||||
10,239 | Interactive Brokers Group, Inc., Class A | 244,712 | ||||||
6,262 | International Bancshares Corp. | 143,775 | ||||||
1,931 | Intervest Bancshares Corp.(b) | 14,618 | ||||||
4,650 | Investment Technology Group, Inc.(b) | 95,976 | ||||||
11,421 | Investors Real Estate Trust REIT | 99,591 | ||||||
6,513 | iStar Financial, Inc. REIT(b) | 96,783 | ||||||
12,030 | Janus Capital Group, Inc. | 145,924 | ||||||
1,394 | JMP Group, Inc. | 9,632 | ||||||
591 | Kansas City Life Insurance Co. | 24,574 | ||||||
7,881 | Kite Realty Group Trust REIT | 48,862 | ||||||
2,804 | Lakeland Bancorp, Inc. | 29,274 | ||||||
723 | LCNB Corp. | 11,568 | ||||||
14,578 | Lexington Realty Trust REIT | 156,859 | ||||||
1,848 | MainSource Financial Group, Inc. | 30,547 | ||||||
655 | Marlin Business Services Corp. | 11,246 | ||||||
4,016 | MB Financial, Inc. | 107,789 | ||||||
9,942 | Meadowbrook Insurance Group, Inc. | 55,675 | ||||||
697 | Mercantile Bank Corp. | 13,598 | ||||||
606 | Merchants Bancshares, Inc. | 17,616 | ||||||
3,958 | Mercury General Corp. | 189,430 | ||||||
1,261 | Metro Bancorp, Inc.(b) | 25,750 | ||||||
6,172 | MGIC Investment Corp.(b) | 53,079 | ||||||
357 | NASB Financial, Inc. | 8,518 | ||||||
608 | National Bankshares, Inc. | 19,809 | ||||||
648 | National Interstate Corp. | 18,157 | ||||||
286 | National Western Life Insurance Co., Class A | 66,709 | ||||||
1,282 | Navigators Group, Inc. (The)(b) | 73,036 | ||||||
3,801 | NBT Bancorp, Inc. | 86,093 | ||||||
2,279 | Nelnet, Inc., Class A | 96,311 | ||||||
26,780 | Newcastle Investment Corp. REIT | 120,242 | ||||||
600 | Northrim Bancorp, Inc. | 14,394 | ||||||
8,475 | Northwest Bancshares, Inc. | 112,633 | ||||||
1,396 | OceanFirst Financial Corp. | 22,643 | ||||||
9,681 | Old National Bancorp | 136,696 | ||||||
1,204 | One Liberty Properties, Inc. REIT | 26,644 | ||||||
5,052 | OneBeacon Insurance Group Ltd., Class A | 78,003 | ||||||
1,722 | Oppenheimer Holdings, Inc., Class A | 43,842 | ||||||
1,505 | Pacific Continental Corp. | 19,836 | ||||||
6,621 | PacWest Bancorp | 260,669 | ||||||
1,415 | Park National Corp. | 102,616 | ||||||
821 | Peapack Gladstone Financial Corp. | 15,607 | ||||||
414 | Penns Woods Bancorp, Inc. | 18,216 | ||||||
6,133 | Pennsylvania Real Estate Investment Trust REIT | 101,501 | ||||||
1,163 | Peoples Bancorp, Inc. | 30,319 | ||||||
2,682 | Phoenix Cos., Inc. (The)(b) | 118,062 | ||||||
1,727 | Piper Jaffray Cos.(b) | 75,746 | ||||||
3,322 | Potlatch Corp. REIT | 127,000 | ||||||
644 | Preferred Bank(b) | 13,814 | ||||||
5,035 | Primerica, Inc. | 231,056 | ||||||
896 | Provident Financial Holdings, Inc. | 12,607 | ||||||
5,734 | Provident Financial Services, Inc. | 99,657 | ||||||
9,010 | RAIT Financial Trust REIT | 73,702 | ||||||
3,995 | Ramco-Gershenson Properties Trust REIT | 65,838 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
9,589 | Redwood Trust, Inc. REIT | $ | 209,040 | |||||
2,012 | Renasant Corp. | 54,767 | ||||||
1,387 | Republic Bancorp, Inc., Class A | 33,302 | ||||||
1,311 | Resource America, Inc., Class A | 11,157 | ||||||
4,268 | RLI Corp. | 183,780 | ||||||
2,632 | Ryman Hospitality Properties, Inc. REIT | 119,888 | ||||||
3,178 | S&T Bancorp, Inc. | 73,920 | ||||||
3,689 | Sabra Health Care REIT, Inc. | 110,559 | ||||||
1,666 | Safety Insurance Group, Inc. | 89,481 | ||||||
2,091 | Sandy Spring Bancorp, Inc. | 50,289 | ||||||
6,468 | Selective Insurance Group, Inc. | 148,376 | ||||||
1,224 | Sierra Bancorp | 19,107 | ||||||
2,341 | Silver Bay Realty Trust Corp. REIT | 35,068 | ||||||
1,278 | Simmons First National Corp., Class A | 46,212 | ||||||
1,345 | Southwest Bancorp, Inc. | 22,461 | ||||||
1,788 | Springleaf Holdings, Inc.(b) | 41,088 | ||||||
1,277 | St. Joe Co. (The)(b) | 22,794 | ||||||
1,698 | State Auto Financial Corp. | 34,741 | ||||||
2,224 | State Bank Financial Corp. | 36,874 | ||||||
1,987 | Stewart Information Services Corp. | 60,603 | ||||||
1,027 | Stock Yards Bancorp, Inc. | 30,276 | ||||||
6,860 | Strategic Hotels & Resorts, Inc. REIT(b) | 74,019 | ||||||
1,205 | Suffolk Bancorp(b) | 26,426 | ||||||
8,898 | Sunstone Hotel Investors, Inc. REIT | 127,330 | ||||||
21,835 | Susquehanna Bancshares, Inc. | 226,211 | ||||||
4,811 | SWS Group, Inc.(b) | 35,649 | ||||||
2,714 | TowneBank | 41,877 | ||||||
1,198 | TriCo Bancshares | 29,051 | ||||||
9,569 | TrustCo Bank Corp. NY | 63,251 | ||||||
7,333 | Trustmark Corp. | 167,706 | ||||||
12,562 | Umpqua Holdings Corp. | 208,906 | ||||||
4,712 | United Bankshares, Inc. | 137,826 | ||||||
2,196 | United Community Banks, Inc.(b) | 35,465 | ||||||
4,206 | United Community Financial Corp.(b) | 14,006 | ||||||
1,694 | United Fire Group, Inc. | 47,127 | ||||||
3,098 | Universal Insurance Holdings, Inc. | 45,324 | ||||||
1,977 | Univest Corp. of Pennsylvania | 38,967 | ||||||
1,936 | Urstadt Biddle Properties, Inc., Class A REIT | 39,514 | ||||||
7,232 | Washington REIT | 176,895 | ||||||
8,922 | Washington Federal, Inc. | 192,537 | ||||||
1,169 | Washington Trust Bancorp, Inc. | 39,980 | ||||||
6,533 | Webster Financial Corp. | 196,905 | ||||||
2,905 | WesBanco, Inc. | 87,847 | ||||||
1,300 | West Bancorporation, Inc. | 18,863 | ||||||
2,086 | Westamerica Bancorp. | 106,010 | ||||||
2,041 | Western Asset Mortgage Capital Corp. REIT | 30,146 | ||||||
2,846 | Westfield Financial, Inc. | 19,495 | ||||||
342 | White Mountains Insurance Group Ltd. | 203,921 | ||||||
3,150 | Wilshire Bancorp, Inc. | 31,500 | ||||||
3,327 | Winthrop Realty Trust REIT | 46,245 | ||||||
684 | World Acceptance Corp.(b)(c) | 49,658 | ||||||
871 | Yadkin Financial Corp.(b) | 16,680 | ||||||
|
| |||||||
15,609,744 | ||||||||
|
| |||||||
Health Care—3.6% | ||||||||
4,907 | Affymetrix, Inc.(b) | 36,459 | ||||||
1,447 | Albany Molecular Research, Inc.(b) | 23,239 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 67 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
993 | Alliance HealthCare Services, Inc.(b) | $ | 28,261 | |||||
7,497 | Amedisys, Inc.(b) | 102,184 | ||||||
4,165 | AMN Healthcare Services, Inc.(b) | 51,979 | ||||||
3,043 | Amsurg Corp.(b) | 131,792 | ||||||
7,971 | BioScrip, Inc.(b) | 55,159 | ||||||
5,271 | Brookdale Senior Living, Inc.(b) | 167,829 | ||||||
1,400 | Cambrex Corp.(b) | 28,686 | ||||||
2,469 | Charles River Laboratories International, Inc.(b) | 132,635 | ||||||
3,253 | Cross Country Healthcare, Inc.(b) | 23,064 | ||||||
3,782 | Emeritus Corp.(b) | 112,817 | ||||||
10,982 | Five Star Quality Care, Inc.(b) | 53,043 | ||||||
8,241 | Gentiva Health Services, Inc.(b) | 62,055 | ||||||
5,092 | Healthways, Inc.(b)(c) | 91,656 | ||||||
4,429 | Hill-Rom Holdings, Inc. | 165,467 | ||||||
4,646 | Invacare Corp. | 73,407 | ||||||
1,593 | LHC Group, Inc.(b) | 33,102 | ||||||
3,825 | Magellan Health Services, Inc.(b) | 220,779 | ||||||
4,584 | Molina Healthcare, Inc.(b) | 171,442 | ||||||
1,009 | National Healthcare Corp. | 55,222 | ||||||
1,936 | OraSure Technologies, Inc.(b) | 12,681 | ||||||
19,573 | PDL BioPharma, Inc.(c) | 166,175 | ||||||
4,886 | PharMerica Corp.(b) | 132,850 | ||||||
1,576 | Providence Service Corp. (The)(b) | 64,001 | ||||||
5,160 | Skilled Healthcare Group, Inc., Class A(b) | 26,626 | ||||||
835 | Surgical Care Affiliates, Inc.(b) | 24,532 | ||||||
780 | SurModics, Inc.(b) | 16,973 | ||||||
4,416 | Symmetry Medical, Inc.(b) | 36,476 | ||||||
9,016 | Universal American Corp. | 64,645 | ||||||
|
| |||||||
2,365,236 | ||||||||
|
| |||||||
Industrials—18.8% | ||||||||
4,556 | AAR Corp. | 118,000 | ||||||
7,041 | ABM Industries, Inc. | 190,741 | ||||||
21,767 | ACCO Brands Corp.(b) | 133,432 | ||||||
10,186 | Accuride Corp.(b) | 57,449 | ||||||
1,041 | Aerovironment, Inc.(b) | 35,155 | ||||||
7,923 | Air Transport Services Group, Inc.(b) | 62,037 | ||||||
7,924 | Aircastle Ltd. | 139,225 | ||||||
2,164 | Albany International Corp., Class A | 77,861 | ||||||
587 | American Science & Engineering, Inc. | 39,446 | ||||||
793 | American Woodmark Corp.(b) | 23,798 | ||||||
1,657 | Apogee Enterprises, Inc. | 52,643 | ||||||
2,878 | Applied Industrial Technologies, Inc. | 137,914 | ||||||
5,139 | ARC Document Solutions, Inc.(b) | 32,890 | ||||||
2,625 | ArcBest Corp. | 103,477 | ||||||
1,549 | Astec Industries, Inc. | 61,883 | ||||||
5,452 | Atlas Air Worldwide Holdings, Inc.(b) | 190,765 | ||||||
3,333 | Baltic Trading Ltd. | 19,965 | ||||||
2,995 | Barnes Group, Inc. | 115,367 | ||||||
5,458 | Brady Corp., Class A | 140,762 | ||||||
6,651 | Briggs & Stratton Corp. | 142,132 | ||||||
6,446 | Brink’s Co. (The) | 163,986 | ||||||
2,100 | Builders FirstSource, Inc.(b) | 16,485 | ||||||
6,234 | Casella Waste Systems, Inc., Class A(b) | 31,793 | ||||||
6,196 | CBIZ, Inc.(b) | 53,100 | ||||||
2,583 | CDI Corp. | 39,572 | ||||||
24,616 | Cenveo, Inc.(b)(c) | 76,063 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
1,747 | Columbus McKinnon Corp.(b) | $ | 46,278 | |||||
4,025 | Comfort Systems USA, Inc. | 60,375 | ||||||
3,857 | Commercial Vehicle Group, Inc.(b) | 37,451 | ||||||
2,039 | Courier Corp. | 29,627 | ||||||
14,088 | Covanta Holding Corp. | 259,924 | ||||||
1,401 | CRA International, Inc.(b) | 30,500 | ||||||
2,856 | Crane Co. | 207,717 | ||||||
3,986 | Deluxe Corp. | 219,031 | ||||||
2,203 | Douglas Dynamics, Inc. | 37,165 | ||||||
1,344 | Ducommun, Inc.(b) | 32,619 | ||||||
2,383 | Dun & Bradstreet Corp. (The) | 263,941 | ||||||
3,560 | Dycom Industries, Inc.(b) | 111,784 | ||||||
1,032 | Dynamic Materials Corp. | 20,846 | ||||||
1,050 | Encore Wire Corp. | 51,166 | ||||||
2,803 | Engility Holdings, Inc.(b) | 122,323 | ||||||
4,023 | Ennis, Inc. | 60,184 | ||||||
1,259 | EnPro Industries, Inc.(b) | 89,653 | ||||||
3,687 | Federal Signal Corp.(b) | 55,969 | ||||||
624 | Franklin Covey Co.(b) | 12,648 | ||||||
1,164 | FreightCar America, Inc. | 30,567 | ||||||
4,982 | FTI Consulting, Inc.(b) | 170,883 | ||||||
1,914 | Furmanite Corp.(b) | 20,059 | ||||||
1,636 | G&K Services, Inc., Class A | 86,610 | ||||||
4,106 | GATX Corp. | 269,477 | ||||||
2,407 | GenCorp, Inc.(b)(c) | 42,267 | ||||||
3,015 | Gibraltar Industries, Inc.(b) | 51,496 | ||||||
4,212 | Global Brass & Copper Holdings, Inc. | 66,802 | ||||||
14,525 | GrafTech International Ltd.(b) | 162,825 | ||||||
4,045 | Granite Construction, Inc. | 151,202 | ||||||
6,321 | Great Lakes Dredge & Dock Corp.(b) | 54,550 | ||||||
1,815 | Greenbrier Cos., Inc. (The)(b) | 95,179 | ||||||
3,334 | H&E Equipment Services, Inc.(b) | 128,526 | ||||||
1,238 | Hardinge, Inc. | 16,540 | ||||||
9,992 | Hawaiian Holdings, Inc.(b) | 144,384 | ||||||
3,301 | Heartland Express, Inc. | 71,830 | ||||||
2,305 | Heidrick & Struggles International, Inc. | 43,449 | ||||||
3,614 | Herman Miller, Inc. | 111,420 | ||||||
3,374 | Hill International, Inc.(b) | 22,673 | ||||||
3,940 | HNI Corp. | 138,806 | ||||||
2,052 | Houston Wire & Cable Co. | 25,568 | ||||||
716 | Hurco Cos., Inc. | 19,089 | ||||||
2,128 | ICF International, Inc.(b) | 82,928 | ||||||
3,255 | Insperity, Inc. | 104,355 | ||||||
1,216 | Insteel Industries, Inc. | 25,025 | ||||||
3,022 | Interface, Inc. | 54,366 | ||||||
1,128 | International Shipholding Corp. | 30,388 | ||||||
1,826 | John Bean Technologies Corp. | 52,936 | ||||||
1,014 | Kadant, Inc. | 35,236 | ||||||
2,381 | Kaman Corp. | 99,931 | ||||||
6,390 | Kelly Services, Inc., Class A | 134,573 | ||||||
2,050 | Kforce, Inc. | 47,396 | ||||||
3,017 | Kimball International, Inc., Class B | 50,565 | ||||||
4,311 | Knight Transportation, Inc. | 102,300 | ||||||
4,531 | Knoll, Inc. | 82,419 | ||||||
3,670 | Korn/Ferry International(b) | 106,613 | ||||||
4,576 | Layne Christensen Co.(b) | 79,714 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 68 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
826 | LB Foster Co., Class A | $ | 39,111 | |||||
2,087 | Lennox International, Inc. | 174,953 | ||||||
1,642 | LMI Aerospace, Inc.(b) | 22,397 | ||||||
3,049 | LSI Industries, Inc. | 23,203 | ||||||
1,434 | Lydall, Inc.(b) | 33,570 | ||||||
2,305 | Macquarie Infrastructure Co. LLC (Australia) | 132,584 | ||||||
7,523 | Manitowoc Co., Inc. (The) | 239,081 | ||||||
1,127 | Masonite International Corp.(b) | 62,098 | ||||||
5,961 | Matson, Inc. | 141,216 | ||||||
1,977 | McGrath RentCorp | 62,434 | ||||||
14,511 | Meritor, Inc.(b) | 172,246 | ||||||
1,243 | Miller Industries, Inc. | 24,077 | ||||||
2,081 | MSA Safety, Inc. | 109,773 | ||||||
4,212 | Mueller Industries, Inc. | 121,895 | ||||||
9,376 | Mueller Water Products, Inc., Class A | 85,509 | ||||||
1,053 | National Presto Industries, Inc.(c) | 76,090 | ||||||
5,064 | Navigant Consulting, Inc.(b) | 85,075 | ||||||
1,289 | NCI Building Systems, Inc.(b) | 20,160 | ||||||
1,307 | NN, Inc. | 25,578 | ||||||
1,019 | Nortek, Inc.(b) | 83,721 | ||||||
1,125 | Northwest Pipe Co.(b) | 40,241 | ||||||
2,929 | Orion Marine Group, Inc.(b) | 34,357 | ||||||
588 | P.A.M. Transportation Services, Inc.(b) | 14,635 | ||||||
866 | Park-Ohio Holdings Corp.(b) | 50,566 | ||||||
468 | Patriot Transportation Holding, Inc.(b) | 16,324 | ||||||
1,390 | PGT, Inc.(b) | 13,830 | ||||||
4,766 | Pike Corp.(b) | 45,754 | ||||||
1,703 | Ply Gem Holdings, Inc.(b) | 21,713 | ||||||
3,112 | Polypore International, Inc.(b) | 107,924 | ||||||
341 | Preformed Line Products Co. | 20,378 | ||||||
7,072 | Quad Graphics, Inc. | 153,109 | ||||||
2,991 | Quality Distribution, Inc.(b) | 37,597 | ||||||
2,957 | Quanex Building Products Corp. | 55,710 | ||||||
23,358 | Republic Airways Holdings, Inc.(b) | 194,105 | ||||||
3,409 | Resources Connection, Inc. | 46,396 | ||||||
2,714 | Rexnord Corp.(b) | 72,572 | ||||||
4,713 | Rush Enterprises, Inc., Class A(b) | 151,287 | ||||||
2,093 | Saia, Inc.(b) | 86,169 | ||||||
1,349 | Schawk, Inc. | 26,980 | ||||||
2,439 | Simpson Manufacturing Co., Inc. | 79,975 | ||||||
19,736 | SkyWest, Inc. | 228,938 | ||||||
842 | Standex International Corp. | 49,990 | ||||||
13,238 | Steelcase, Inc., Class A | 218,162 | ||||||
2,331 | Sterling Construction Co., Inc.(b) | 17,902 | ||||||
1,478 | TRC Cos., Inc.(b) | 8,765 | ||||||
2,565 | Trimas Corp.(b) | 91,981 | ||||||
3,097 | TrueBlue, Inc.(b) | 82,845 | ||||||
9,916 | Tutor Perini Corp.(b) | 293,514 | ||||||
1,153 | Twin Disc, Inc. | 33,356 | ||||||
5,689 | United Stationers, Inc. | 213,508 | ||||||
1,723 | Universal Forest Products, Inc. | 86,994 | ||||||
3,821 | USG Corp.(b) | 114,095 | ||||||
11,211 | UTi Worldwide, Inc. | 109,756 | ||||||
2,421 | Viad Corp. | 55,804 | ||||||
1,068 | Vicor Corp.(b) | 8,928 | ||||||
779 | VSE Corp. | 48,664 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
1,747 | Watts Water Technologies, Inc., Class A | $ | 92,940 | |||||
6,855 | Werner Enterprises, Inc. | 175,488 | ||||||
3,404 | West Corp. | 82,887 | ||||||
943 | Willis Lease Finance Corp.(b) | 19,011 | ||||||
2,017 | Xerium Technologies, Inc.(b) | 27,229 | ||||||
10,209 | YRC Worldwide, Inc.(b)(c) | 228,988 | ||||||
|
| |||||||
12,312,227 | ||||||||
|
| |||||||
Information Technology—12.0% | ||||||||
2,881 | Actuate Corp.(b) | 16,220 | ||||||
2,838 | Acxiom Corp.(b) | 80,145 | ||||||
3,715 | ADTRAN, Inc. | 83,327 | ||||||
1,719 | Advanced Energy Industries, Inc.(b) | 37,612 | ||||||
1,913 | Aeroflex Holding Corp.(b) | 14,634 | ||||||
1,588 | Agilysys, Inc.(b) | 19,914 | ||||||
2,364 | Alpha & Omega Semiconductor Ltd.(b) | 17,021 | ||||||
1,660 | American Software, Inc., Class A | 16,002 | ||||||
31,443 | Amkor Technology, Inc.(b) | 249,972 | ||||||
6,192 | ANADIGICS, Inc.(b) | 7,740 | ||||||
1,246 | Applied Micro Circuits Corp.(b) | 12,099 | ||||||
21,069 | Atmel Corp.(b) | 163,706 | ||||||
4,725 | AVX Corp. (Japan) | 63,079 | ||||||
9,302 | Axcelis Technologies, Inc.(b) | 16,651 | ||||||
1,251 | Bel Fuse, Inc., Class B | 27,222 | ||||||
1,877 | Belden, Inc. | 138,541 | ||||||
8,003 | Benchmark Electronics, Inc.(b) | 185,510 | ||||||
2,674 | Black Box Corp. | 56,849 | ||||||
5,070 | Brooks Automation, Inc. | 51,866 | ||||||
2,945 | Cabot Microelectronics Corp.(b) | 127,725 | ||||||
8,390 | Cadence Design Systems, Inc.(b) | 130,548 | ||||||
6,305 | CDW Corp. | 177,738 | ||||||
5,027 | Checkpoint Systems, Inc.(b) | 64,195 | ||||||
14,177 | CIBER, Inc.(b) | 61,245 | ||||||
3,321 | Cinedigm Corp., Class A(b) | 8,302 | ||||||
2,824 | Cohu, Inc. | 29,087 | ||||||
3,826 | CommScope Holding Co., Inc.(b) | 102,078 | ||||||
13,481 | Compuware Corp. | 139,663 | ||||||
2,131 | Comtech Telecommunications Corp. | 67,659 | ||||||
7,989 | Convergys Corp. | 172,083 | ||||||
3,192 | Conversant, Inc.(b) | 78,012 | ||||||
2,039 | CTS Corp. | 36,274 | ||||||
6,219 | Cypress Semiconductor Corp.(b) | 58,894 | ||||||
2,926 | Daktronics, Inc. | 38,097 | ||||||
3,111 | Dice Holdings, Inc.(b) | 23,799 | ||||||
6,723 | Diebold, Inc. | 252,852 | ||||||
2,877 | Digi International, Inc.(b) | 25,490 | ||||||
3,043 | Digital River, Inc.(b) | 46,527 | ||||||
2,752 | Diodes, Inc.(b) | 72,570 | ||||||
2,027 | Dot Hill Systems Corp.(b) | 8,371 | ||||||
2,948 | DSP Group, Inc.(b) | 23,466 | ||||||
32,593 | EarthLink Holdings Corp. | 111,142 | ||||||
2,822 | Eastman Kodak Co.(b) | 84,293 | ||||||
2,202 | Electro Rent Corp. | 35,562 | ||||||
3,194 | Electro Scientific Industries, Inc. | 27,085 | ||||||
8,936 | Emulex Corp.(b) | 63,892 | ||||||
7,428 | Entegris, Inc.(b) | 82,377 | ||||||
614 | ePlus, Inc.(b) | 30,725 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 69 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
2,711 | Euronet Worldwide, Inc.(b) | $ | 124,679 | |||||
1,405 | Fair Isaac Corp. | 80,366 | ||||||
14,795 | Fairchild Semiconductor International, Inc.(b) | 188,340 | ||||||
4,115 | FormFactor, Inc.(b) | 23,661 | ||||||
5,200 | Freescale Semiconductor Ltd.(b) | 114,244 | ||||||
6,492 | Global Cash Access Holdings, Inc.(b) | 42,847 | ||||||
2,563 | GSI Group, Inc.(b) | 31,115 | ||||||
1,371 | GSI Technology, Inc.(b) | 8,706 | ||||||
2,451 | Hackett Group, Inc. (The) | 14,706 | ||||||
9,058 | Harmonic, Inc.(b) | 63,678 | ||||||
7,718 | Imation Corp.(b) | 33,342 | ||||||
5,924 | Integrated Device Technology, Inc.(b) | 69,133 | ||||||
2,483 | Integrated Silicon Solution, Inc.(b) | 35,904 | ||||||
3,492 | Internap Network Services Corp.(b) | 23,466 | ||||||
5,117 | International Rectifier Corp.(b) | 133,247 | ||||||
14,160 | Intersil Corp., Class A | 174,734 | ||||||
1,522 | Intevac, Inc.(b) | 12,252 | ||||||
5,565 | Itron, Inc.(b) | 211,470 | ||||||
1,895 | IXYS Corp. | 20,447 | ||||||
9,819 | Kemet Corp.(b) | 49,193 | ||||||
2,558 | Kofax Ltd. (Bermuda)(b) | 19,390 | ||||||
3,153 | Kopin Corp.(b) | 10,279 | ||||||
3,154 | Lionbridge Technologies, Inc.(b) | 18,546 | ||||||
2,437 | LTX-Credence Corp.(b) | 23,468 | ||||||
1,349 | Methode Electronics, Inc. | 37,421 | ||||||
3,169 | Micrel, Inc. | 31,563 | ||||||
3,372 | MKS Instruments, Inc. | 94,922 | ||||||
7,577 | ModusLink Global Solutions, Inc.(b)(c) | 30,611 | ||||||
15,625 | Monster Worldwide, Inc.(b) | 107,656 | ||||||
1,220 | Move, Inc.(b) | 13,042 | ||||||
1,597 | Multi-Fineline Electronix, Inc. (Singapore)(b) | 19,771 | ||||||
1,271 | NCI, Inc., Class A(b) | 12,672 | ||||||
2,452 | Newport Corp.(b) | 45,803 | ||||||
6,649 | OmniVision Technologies, Inc.(b) | 129,855 | ||||||
1,527 | Oplink Communications, Inc.(b) | 26,173 | ||||||
1,905 | Park Electrochemical Corp. | 50,787 | ||||||
2,491 | Pericom Semiconductor Corp.(b) | 20,102 | ||||||
9,631 | Photronics, Inc.(b) | 83,597 | ||||||
3,668 | Plexus Corp.(b) | 153,763 | ||||||
10,521 | PMC - Sierra, Inc.(b) | 71,964 | ||||||
13,209 | Polycom, Inc.(b) | 162,471 | ||||||
2,564 | PRGX Global, Inc.(b) | 16,487 | ||||||
3,325 | Progress Software Corp.(b) | 71,354 | ||||||
9,067 | QLogic Corp.(b) | 104,996 | ||||||
30,303 | Quantum Corp.(b) | 32,727 | ||||||
4,556 | QuinStreet, Inc.(b) | 27,792 | ||||||
3,333 | RealNetworks, Inc.(b) | 25,131 | ||||||
15,991 | RF Micro Devices, Inc.(b) | 134,964 | ||||||
1,458 | Richardson Electronics Ltd. | 14,609 | ||||||
2,944 | Rofin-Sinar Technologies, Inc.(b) | 65,357 | ||||||
2,146 | Rudolph Technologies, Inc.(b) | 19,550 | ||||||
4,037 | ScanSource, Inc.(b) | 155,061 | ||||||
3,423 | Sigma Designs, Inc.(b) | 12,905 | ||||||
2,250 | Silicon Graphics International Corp.(b) | 27,180 | ||||||
3,331 | Silicon Image, Inc.(b) | 18,687 | ||||||
9,938 | Sonus Networks, Inc.(b) | 32,497 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
6,269 | Spansion, Inc., Class A(b) | $ | 111,776 | |||||
4,419 | Speed Commerce, Inc.(b) | 14,583 | ||||||
11,473 | SunEdison, Inc.(b) | 220,626 | ||||||
4,498 | Sykes Enterprises, Inc.(b) | 89,015 | ||||||
1,881 | TeleTech Holdings, Inc.(b) | 45,389 | ||||||
9,346 | TTM Technologies, Inc.(b) | 73,740 | ||||||
1,830 | Ultra Clean Holdings, Inc.(b) | 15,592 | ||||||
10,661 | United Online, Inc. | 126,333 | ||||||
1,781 | VASCO Data Security International, Inc.(b) | 20,321 | ||||||
480 | Viasystems Group, Inc.(b) | 5,770 | ||||||
1,557 | Vishay Precision Group, Inc.(b) | 25,270 | ||||||
1,326 | WebMD Health Corp.(b)(c) | 58,463 | ||||||
1,375 | XO Group, Inc.(b) | 14,602 | ||||||
2,265 | Zebra Technologies Corp., Class A(b) | 157,282 | ||||||
894 | Zygo Corp.(b) | 17,201 | ||||||
|
| |||||||
7,812,507 | ||||||||
|
| |||||||
Materials—7.5% | ||||||||
3,466 | A. Schulman, Inc. | 124,499 | ||||||
3,321 | A.M. Castle & Co.(b) | 40,782 | ||||||
978 | AEP Industries, Inc.(b) | 34,836 | ||||||
36,293 | AK Steel Holding Corp.(b) | 254,051 | ||||||
1,676 | AMCOL International Corp. | 76,845 | ||||||
1,612 | Ampco-Pittsburgh Corp. | 32,288 | ||||||
3,628 | Boise Cascade Co.(b) | 90,773 | ||||||
2,867 | Carpenter Technology Corp. | 180,048 | ||||||
7,215 | Century Aluminum Co.(b) | 99,206 | ||||||
7,873 | Chemtura Corp.(b) | 175,568 | ||||||
17,927 | Coeur Mining, Inc.(b) | 155,248 | ||||||
2,435 | Cytec Industries, Inc. | 232,104 | ||||||
7,488 | Ferro Corp.(b) | 97,194 | ||||||
4,000 | Greif, Inc., Class A | 216,760 | ||||||
2,578 | H.B. Fuller Co. | 119,439 | ||||||
724 | Handy & Harman Ltd.(b) | 16,370 | ||||||
917 | Haynes International, Inc. | 48,647 | ||||||
3,567 | Headwaters, Inc.(b) | 44,516 | ||||||
2,533 | Horsehead Holding Corp.(b) | 39,489 | ||||||
1,798 | Kaiser Aluminum Corp. | 126,579 | ||||||
2,459 | Koppers Holdings, Inc. | 104,999 | ||||||
4,182 | Kraton Performance Polymers, Inc.(b) | 108,941 | ||||||
2,502 | Kronos Worldwide, Inc. | 39,156 | ||||||
2,327 | Materion Corp. | 78,304 | ||||||
1,823 | Minerals Technologies, Inc. | 108,450 | ||||||
2,730 | Myers Industries, Inc. | 51,051 | ||||||
1,151 | Neenah Paper, Inc. | 57,976 | ||||||
20,530 | Noranda Aluminum Holding Corp. | 72,882 | ||||||
8,971 | Olin Corp. | 252,085 | ||||||
1,568 | Olympic Steel, Inc. | 41,332 | ||||||
4,935 | OM Group, Inc. | 144,546 | ||||||
3,947 | P.H. Glatfelter Co. | 100,727 | ||||||
1,016 | Penford Corp.(b) | 12,802 | ||||||
2,578 | RTI International Metals, Inc.(b) | 72,596 | ||||||
6,345 | Schnitzer Steel Industries, Inc., Class A | 178,104 | ||||||
3,048 | Scotts Miracle-Gro Co. (The), Class A | 186,568 | ||||||
3,524 | Sensient Technologies Corp. | 190,472 | ||||||
3,678 | Silgan Holdings, Inc. | 182,981 | ||||||
5,833 | SunCoke Energy, Inc.(b) | 121,735 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 70 |
|
PowerShares Fundamental Pure Small Value Portfolio (PXSV) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Materials (continued) | ||||||||
639 | Texas Industries, Inc.(b) | $ | 55,401 | |||||
44,435 | Thompson Creek Metals Co., Inc.(b)(c) | 119,086 | ||||||
2,358 | Tredegar Corp. | 49,070 | ||||||
768 | Universal Stainless & Alloy Products, Inc.(b) | 27,564 | ||||||
1,223 | US Concrete, Inc.(b) | 30,110 | ||||||
18,950 | Walter Energy, Inc.(c) | 136,440 | ||||||
4,597 | Wausau Paper Corp. | 54,980 | ||||||
3,420 | Worthington Industries, Inc. | 125,856 | ||||||
|
| |||||||
4,909,456 | ||||||||
|
| |||||||
Telecommunication Services—1.4% | ||||||||
5,144 | Cbeyond, Inc.(b) | 50,874 | ||||||
50,958 | Cincinnati Bell, Inc.(b) | 170,709 | ||||||
5,269 | Consolidated Communications Holdings, Inc. | 104,958 | ||||||
5,601 | FairPoint Communications, Inc.(b) | 76,398 | ||||||
4,528 | General Communication, Inc., Class A(b) | 47,272 | ||||||
1,190 | Hawaiian Telcom Holdco, Inc.(b) | 31,678 | ||||||
1,525 | HickoryTech Corp. | 18,102 | ||||||
26,440 | Leap Wireless Corp.(b) | 66,629 | ||||||
1,561 | Lumos Networks Corp. | 20,621 | ||||||
4,785 | NTELOS Holdings Corp.(c) | 65,985 | ||||||
4,601 | Premiere Global Services, Inc.(b) | 58,525 | ||||||
2,284 | United States Cellular Corp. | 94,877 | ||||||
5,254 | USA Mobility, Inc. | 90,001 | ||||||
|
| |||||||
896,629 | ||||||||
|
| |||||||
Utilities—6.1% | ||||||||
3,782 | ALLETE, Inc. | 195,756 | ||||||
767 | Artesian Resources Corp., Class A | 16,889 | ||||||
53,614 | Atlantic Power Corp.(c) | 159,234 | ||||||
7,333 | Avista Corp. | 235,756 | ||||||
3,837 | Black Hills Corp. | 221,587 | ||||||
3,738 | California Water Service Group | 84,105 | ||||||
4,951 | Cleco Corp. | 260,175 | ||||||
9,842 | Dynegy, Inc.(b) | 280,005 | ||||||
3,506 | El Paso Electric Co. | 132,597 | ||||||
5,663 | Empire District Electric Co. (The) | 137,724 | ||||||
1,028 | Genie Energy Ltd., Class B(b) | 8,327 | ||||||
4,488 | IDACORP, Inc. | 251,956 | ||||||
3,164 | Laclede Group, Inc. (The) | 150,005 | ||||||
2,834 | MGE Energy, Inc. | 108,316 | ||||||
1,472 | Middlesex Water Co. | 29,926 | ||||||
4,995 | New Jersey Resources Corp. | 248,401 | ||||||
3,609 | Northwest Natural Gas Co. | 159,770 | ||||||
4,002 | NorthWestern Corp. | 193,617 | ||||||
974 | Ormat Technologies, Inc. (Israel) | 25,986 | ||||||
4,106 | Otter Tail Corp. | 120,306 | ||||||
7,399 | Piedmont Natural Gas Co., Inc. | 264,810 | ||||||
9,859 | PNM Resources, Inc. | 272,897 | ||||||
1,379 | SJW Corp. | 37,550 | ||||||
2,519 | South Jersey Industries, Inc. | 144,717 | ||||||
1,524 | Unitil Corp. | 50,597 | ||||||
3,664 | UNS Energy Corp. | 220,060 | ||||||
|
| |||||||
4,011,069 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $58,064,101) | 65,301,615 | |||||||
|
|
Number of Shares | Value | |||||||
Money Market Fund—0.2% | ||||||||
102,672 | Invesco Premier Portfolio—Institutional Class(d) (Cost $102,672) | $ | 102,672 | |||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $58,166,773)—100.1% | 65,404,287 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—3.0% | ||||||||
1,980,542 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $1,980,542) | 1,980,542 | ||||||
|
| |||||||
Total Investments (Cost $60,147,315)—103.1% | 67,384,829 | |||||||
Other assets less liabilities—(3.1)% | (2,009,048 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 65,375,781 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 1,901,168 | $ | (1,901,168 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 71 |
|
Schedule of Investments(a)
PowerShares Zacks Micro Cap Portfolio (PZI)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—99.9% | ||||||||
Consumer Discretionary—14.4% | ||||||||
14,019 | AH Belo Corp., Class A | $ | 161,359 | |||||
26,526 | bebe Stores, Inc. | 133,956 | ||||||
333 | Biglari Holdings, Inc.(b) | 142,864 | ||||||
13,274 | Black Diamond, Inc.(b) | 148,005 | ||||||
16,858 | Build-A-Bear Workshop, Inc.(b) | 189,147 | ||||||
21,761 | Career Education Corp.(b) | 157,114 | ||||||
5,437 | Carmike Cinemas, Inc.(b) | 161,261 | ||||||
2,069 | Cavco Industries, Inc.(b) | 161,279 | ||||||
22,641 | Century Casinos, Inc.(b) | 134,714 | ||||||
20,549 | China Automotive Systems, Inc. (China)(b) | 154,528 | ||||||
31,040 | China XD Plastics Co. Ltd. (China)(b) | 212,314 | ||||||
9,966 | Citi Trends, Inc.(b) | 169,322 | ||||||
2,236 | Core-Mark Holding Co., Inc. | 180,087 | ||||||
6,013 | CSS Industries, Inc. | 144,132 | ||||||
9,161 | E.W. Scripps Co. (The), Class A(b) | 156,928 | ||||||
16,121 | Entercom Communications Corp., Class A(b) | 174,107 | ||||||
24,230 | Entravision Communications Corp., Class A | 128,661 | ||||||
12,115 | Escalade, Inc. | 178,333 | ||||||
4,315 | Flexsteel Industries, Inc. | 148,091 | ||||||
9,014 | Fred’s, Inc., Class A | 164,235 | ||||||
15,087 | Fuel Systems Solutions, Inc.(b) | 158,112 | ||||||
22,392 | Gaiam, Inc., Class A(b) | 165,253 | ||||||
15,655 | Gray Television, Inc.(b) | 176,119 | ||||||
5,466 | Haverty Furniture Cos., Inc. | 139,602 | ||||||
16,893 | hhgregg, Inc.(b)(c) | 145,618 | ||||||
5,660 | ITT Educational Services, Inc.(b) | 152,820 | ||||||
18,323 | Journal Communications, Inc., Class A(b) | 146,950 | ||||||
9,899 | Kandi Technologies Group, Inc. (China)(b)(c) | 110,968 | ||||||
8,780 | Kirkland’s, Inc.(b) | 150,226 | ||||||
32,468 | Lakes Entertainment, Inc.(b) | 160,717 | ||||||
9,090 | Lifetime Brands, Inc. | 173,619 | ||||||
9,721 | Marcus Corp. (The) | 162,632 | ||||||
25,286 | McClatchy Co. (The), Class A(b) | 138,567 | ||||||
11,081 | Modine Manufacturing Co.(b) | 182,615 | ||||||
8,761 | Monarch Casino & Resort, Inc.(b) | 140,526 | ||||||
6,110 | Motorcar Parts of America, Inc.(b) | 167,658 | ||||||
12,763 | Pep Boys-Manny, Moe & Jack (The)(b) | 130,438 | ||||||
11,815 | Perry Ellis International, Inc.(b) | 178,406 | ||||||
16,771 | Quantum Fuel Systems Technologies Worldwide, Inc.(b) | 110,856 | ||||||
34,249 | Radio One, Inc., Class D(b) | 154,805 | ||||||
14,405 | Rick’s Cabaret International, Inc.(b) | 145,490 | ||||||
16,250 | Salem Communications Corp., Class A | 143,162 | ||||||
9,151 | Shiloh Industries, Inc.(b) | 180,641 | ||||||
7,046 | Shoe Carnival, Inc. | 160,931 | ||||||
17,684 | Skullcandy, Inc.(b) | 136,167 | ||||||
43,523 | SORL Auto Parts, Inc.(b) | 135,357 | ||||||
11,587 | Stein Mart, Inc. | 144,837 | ||||||
14,456 | Stoneridge, Inc.(b) | 154,535 | ||||||
2,248 | Strattec Security Corp. | 150,189 | ||||||
10,888 | Systemax, Inc.(b) | 188,254 | ||||||
5,964 | Tower International, Inc.(b) | 165,859 | ||||||
19,919 | TravelCenters of America LLC(b) | 150,787 | ||||||
11,473 | Tuesday Morning Corp.(b) | 160,393 | ||||||
7,037 | Unifi, Inc.(b) | 155,799 | ||||||
4,229 | Universal Electronics, Inc.(b) | 157,953 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
33,403 | ValueVision Media, Inc., Class A(b) | $ | 156,326 | |||||
11,867 | VOXX International Corp.(b) | 139,437 | ||||||
|
| |||||||
8,873,061 | ||||||||
|
| |||||||
Consumer Staples—2.8% | ||||||||
9,527 | Amira Nature Foods Ltd. (United Arab Emirates)(b)(c) | 148,240 | ||||||
13,039 | Chiquita Brands International, Inc.(b) | 149,688 | ||||||
21,083 | G Willi-Food International Ltd. (Israel)(b) | 158,755 | ||||||
6,815 | Ingles Markets, Inc., Class A | 156,677 | ||||||
41,308 | Liberator Medical Holdings, Inc.(c) | 159,862 | ||||||
24,050 | Mgp Ingredients, Inc. | 140,452 | ||||||
13,450 | Omega Protein Corp.(b) | 152,792 | ||||||
10,583 | Pantry, Inc. (The)(b) | 159,168 | ||||||
23,596 | Roundy’s, Inc.(c) | 159,745 | ||||||
6,994 | Spartan Stores, Inc. | 150,651 | ||||||
13,746 | SunOpta, Inc. (Canada)(b) | 160,416 | ||||||
|
| |||||||
1,696,446 | ||||||||
|
| |||||||
Energy—9.4% | ||||||||
2,803 | Adams Resources & Energy, Inc. | 201,984 | ||||||
32,929 | Advantage Oil & Gas Ltd. (Canada)(b) | 208,441 | ||||||
95,494 | Cal Dive International, Inc.(b)(c) | 141,331 | ||||||
19,395 | Callon Petroleum Co.(b) | 178,046 | ||||||
14,826 | Capital Product Partners LP (Greece)(c) | 163,086 | ||||||
20,866 | DHT Holdings, Inc. | 162,963 | ||||||
35,445 | Equal Energy Ltd. | 160,566 | ||||||
5,539 | Era Group, Inc.(b) | 158,138 | ||||||
41,099 | Forbes Energy Services Ltd.(b) | 170,150 | ||||||
29,678 | Gastar Exploration, Inc.(b) | 196,765 | ||||||
43,175 | Harvest Natural Resources, Inc.(b) | 194,719 | ||||||
11,981 | Knightsbridge Tankers Ltd. (Bermuda) | 143,173 | ||||||
4,806 | Matrix Service Co.(b) | 148,842 | ||||||
27,609 | Miller Energy Resources, Inc.(b)(c) | 133,075 | ||||||
5,386 | Natural Gas Services Group, Inc.(b) | 165,296 | ||||||
44,355 | Navios Maritime Acquisition Corp. | 157,460 | ||||||
11,180 | Niska Gas Storage Partners LLC, Class U | 180,781 | ||||||
16,498 | Nordic American Tankers Ltd. | 142,378 | ||||||
22,547 | North American Energy Partners, Inc. (Canada) | 177,445 | ||||||
10,433 | Pacific Ethanol, Inc.(b) | 162,755 | ||||||
22,897 | Parker Drilling Co.(b) | 151,807 | ||||||
3,670 | PHI, Inc.(b) | 164,416 | ||||||
12,536 | Pioneer Energy Services Corp.(b) | 187,664 | ||||||
13,551 | Renewable Energy Group, Inc.(b) | 159,495 | ||||||
2,846 | REX American Resources Corp.(b) | 186,015 | ||||||
11,876 | Rhino Resource Partners LP(c) | 153,200 | ||||||
14,278 | StealthGas, Inc.(b) | 154,774 | ||||||
15,087 | Swift Energy Co.(b) | 186,023 | ||||||
45,859 | Teekay Tankers Ltd., Class A | 160,048 | ||||||
8,775 | Tesco Corp.(b) | 175,500 | ||||||
19,701 | Triangle Petroleum Corp.(b) | 189,524 | ||||||
20,920 | Tsakos Energy Navigation Ltd. | 149,160 | ||||||
34,105 | US Energy Corp. Wyoming(b) | 144,946 | ||||||
33,821 | Warren Resources, Inc.(b) | 171,472 | ||||||
12,864 | Willbros Group, Inc.(b) | 142,919 | ||||||
|
| |||||||
5,824,357 | ||||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 72 |
|
PowerShares Zacks Micro Cap Portfolio (PZI) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials—28.3% | ||||||||
21,193 | 1st United Bancorp, Inc. | $ | 155,133 | |||||
6,967 | Ameris Bancorp(b) | 148,188 | ||||||
3,697 | AMERISAFE, Inc. | 157,677 | ||||||
9,762 | Apollo Commercial Real Estate Finance, Inc. REIT | 166,052 | ||||||
6,131 | Arlington Asset Investment Corp., Class A | 162,165 | ||||||
11,858 | Atlas Financial Holdings (Cayman Islands)(b) | 165,538 | ||||||
13,231 | Banc of California, Inc. | 166,314 | ||||||
8,630 | Bancorp, Inc. (The)(b) | 136,527 | ||||||
3,939 | Banner Corp. | 155,748 | ||||||
6,273 | Berkshire Hills Bancorp, Inc. | 146,976 | ||||||
9,368 | BNC Bancorp | 152,698 | ||||||
17,233 | Brookline Bancorp, Inc. | 156,476 | ||||||
12,555 | Calamos Asset Management, Inc., Class A | 152,920 | ||||||
6,465 | Capital Bank Financial Corp., Class A(b) | 154,190 | ||||||
12,224 | Capital City Bank Group, Inc. | 169,914 | ||||||
4,676 | Capital Southwest Corp. | 164,128 | ||||||
14,866 | Centerstate Banks, Inc. | 163,080 | ||||||
66,261 | China Housing & Land Development, Inc.(b)(c) | 149,087 | ||||||
7,073 | Cim Commercial Trust Corp. REIT | 156,384 | ||||||
3,914 | Community Trust Bancorp, Inc. | 144,309 | ||||||
36,812 | Cowen Group, Inc., Class A(b) | 151,297 | ||||||
8,823 | Cu Bancorp(b) | 160,137 | ||||||
7,779 | Customers Bancorp, Inc.(b) | 171,371 | ||||||
7,794 | CyrusOne, Inc. REIT | 155,880 | ||||||
9,561 | Dime Community Bancshares, Inc. | 155,844 | ||||||
18,703 | Doral Financial Corp. (Puerto Rico)(b)(c) | 178,801 | ||||||
4,497 | Eagle Bancorp, Inc.(b) | 150,155 | ||||||
6,815 | Ellington Financial LLC | 161,311 | ||||||
4,569 | EMC Insurance Group, Inc. | 150,731 | ||||||
8,089 | Enterprise Financial Services Corp. | 144,550 | ||||||
7,228 | Farmers Capital Bank Corp.(b) | 150,993 | ||||||
6,285 | FBR & Co.(b) | 162,153 | ||||||
8,861 | Federated National Holding Co. | 172,169 | ||||||
8,544 | First Bancorp. | 147,042 | ||||||
3,441 | First Business Financial Services, Inc. | 155,568 | ||||||
17,958 | First Commonwealth Financial Corp. | 154,259 | ||||||
5,986 | First Defiance Financial Corp. | 161,742 | ||||||
15,994 | First Financial Northwest, Inc. | 163,139 | ||||||
7,502 | First Merchants Corp. | 159,192 | ||||||
7,604 | Firsthand Technology Value Fund, Inc.(b) | 148,734 | ||||||
7,705 | Flushing Financial Corp. | 148,090 | ||||||
9,120 | Forestar Group, Inc.(b) | 155,496 | ||||||
10,991 | FXCM, Inc., Class A | 170,141 | ||||||
15,018 | Gain Capital Holdings, Inc. | 151,682 | ||||||
16,105 | Gladstone Capital Corp.(c) | 155,735 | ||||||
19,630 | Gladstone Investment Corp. | 154,292 | ||||||
6,163 | Global Indemnity PLC(b) | 165,168 | ||||||
9,100 | Golub Capital BDC, Inc. | 152,152 | ||||||
16,010 | GSV Capital Corp.(b)(c) | 140,568 | ||||||
6,967 | Hanmi Financial Corp. | 148,188 | ||||||
4,460 | HCI Group, Inc. | 172,513 | ||||||
6,015 | Heartland Financial USA, Inc. | 146,164 | ||||||
11,538 | Hercules Technology Growth Capital, Inc. | 157,840 | ||||||
9,595 | Heritage Financial Corp. | 155,055 | ||||||
8,262 | Heritage Financial Group, Inc. | 159,043 | ||||||
7,950 | ICG Group, Inc.(b) | 162,021 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
28,233 | Imperial Holdings, Inc.(b)(c) | $ | 188,879 | |||||
12,097 | Independence Holding Co. | 157,987 | ||||||
12,507 | Independent Bank Corp. | 162,841 | ||||||
4,123 | Independent Bank Corp. | 153,046 | ||||||
2,400 | Infinity Property & Casualty Corp. | 154,008 | ||||||
21,791 | Intervest Bancshares Corp.(b) | 164,958 | ||||||
8,630 | INTL FCStone, Inc.(b) | 163,280 | ||||||
8,037 | Investment Technology Group, Inc.(b) | 165,884 | ||||||
22,833 | JMP Group, Inc. | 157,776 | ||||||
3,368 | Kansas City Life Insurance Co. | 140,041 | ||||||
53,755 | Ladenburg Thalmann Financial Services, Inc.(b) | 146,751 | ||||||
4,036 | Lakeland Financial Corp. | 147,718 | ||||||
14,215 | LNB Bancorp, Inc. | 161,767 | ||||||
13,008 | Maiden Holdings Ltd. | 153,494 | ||||||
9,494 | MainSource Financial Group, Inc. | 156,936 | ||||||
27,846 | Meadowbrook Insurance Group, Inc. | 155,938 | ||||||
7,873 | Mercantile Bank Corp. | 153,602 | ||||||
3,620 | Meta Financial Group, Inc. | 151,714 | ||||||
664 | National Western Life Insurance Co., Class A | 154,878 | ||||||
2,644 | Navigators Group, Inc. (The)(b) | 150,629 | ||||||
11,157 | New Mountain Finance Corp. | 159,657 | ||||||
20,866 | New York Mortgage Trust, Inc. REIT | 153,782 | ||||||
12,624 | Northfield Bancorp, Inc. | 163,733 | ||||||
9,444 | OFG Bancorp | 161,115 | ||||||
5,787 | Oppenheimer Holdings, Inc., Class A | 147,337 | ||||||
7,379 | Peapack Gladstone Financial Corp. | 140,275 | ||||||
14,691 | PennantPark Investment Corp. | 157,194 | ||||||
3,137 | Phoenix Cos., Inc. (The)(b) | 138,091 | ||||||
6,246 | PICO Holdings, Inc.(b) | 145,219 | ||||||
3,545 | Piper Jaffray Cos.(b) | 155,484 | ||||||
19,121 | RAIT Financial Trust REIT | 156,410 | ||||||
6,583 | Regional Management Corp.(b) | 100,983 | ||||||
5,588 | Renasant Corp. | 152,105 | ||||||
42,166 | Republic First Bancorp, Inc.(b) | 186,374 | ||||||
6,850 | S&T Bancorp, Inc. | 159,331 | ||||||
7,319 | Safeguard Scientifics, Inc.(b) | 153,772 | ||||||
3,015 | Safety Insurance Group, Inc. | 161,936 | ||||||
6,499 | Sandy Spring Bancorp, Inc. | 156,301 | ||||||
4,356 | Simmons First National Corp., Class A | 157,513 | ||||||
9,224 | Simplicity Bancorp, Inc. | 159,944 | ||||||
9,177 | State Bank Financial Corp. | 152,155 | ||||||
12,823 | Sterling Bancorp | 153,363 | ||||||
4,621 | Stewart Information Services Corp. | 140,941 | ||||||
7,280 | Suffolk Bancorp(b) | 159,650 | ||||||
17,493 | Summit Hotel Properties, Inc. REIT | 158,487 | ||||||
9,809 | TCP Capital Corp. | 158,808 | ||||||
23,060 | TrustCo Bank Corp. | 152,427 | ||||||
11,945 | United Financial Bancorp, Inc. | 157,196 | ||||||
5,349 | United Fire Group, Inc. | 148,809 | ||||||
11,112 | United Insurance Holdings Corp. | 169,458 | ||||||
12,783 | Universal Insurance Holdings, Inc. | 187,015 | ||||||
15,625 | Waterstone Financial, Inc. | 162,656 | ||||||
5,100 | WesBanco, Inc. | 154,224 | ||||||
14,625 | Wilshire Bancorp, Inc. | 146,250 | ||||||
2,273 | WSFS Financial Corp. | 153,700 | ||||||
7,582 | Yadkin Financial Corp.(b) | 145,195 | ||||||
|
| |||||||
17,481,737 | ||||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 73 |
|
PowerShares Zacks Micro Cap Portfolio (PZI) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care—8.9% | ||||||||
7,043 | Addus HomeCare Corp.(b) | $ | 152,270 | |||||
22,768 | Affymetrix, Inc.(b) | 169,166 | ||||||
8,733 | Albany Molecular Research, Inc.(b) | 140,252 | ||||||
7,028 | Almost Family, Inc.(b) | 150,891 | ||||||
10,903 | Amedisys, Inc.(b) | 148,608 | ||||||
10,307 | AngioDynamics, Inc.(b) | 138,526 | ||||||
5,178 | Ani Pharmaceuticals, Inc.(b) | 161,088 | ||||||
3,950 | Anika Therapeutics, Inc.(b) | 168,823 | ||||||
9,887 | Arrowhead Research Corp.(b) | 107,768 | ||||||
16,089 | Biotelemetry, Inc.(b) | 127,747 | ||||||
8,603 | Cambrex Corp.(b) | 176,275 | ||||||
71,832 | Catalyst Pharmaceutical Partners, Inc.(b) | 149,411 | ||||||
29,409 | Chelsea Therapeutics International Ltd.(b)(c) | 143,516 | ||||||
40,585 | China Cord Blood Corp. (Hong Kong)(b) | 174,921 | ||||||
20,116 | Cross Country Healthcare, Inc.(b) | 142,622 | ||||||
16,299 | CryoLife, Inc. | 147,995 | ||||||
33,403 | Five Star Quality Care, Inc.(b) | 161,337 | ||||||
9,234 | Fonar Corp.(b) | 142,850 | ||||||
39,789 | Idera Pharmaceuticals, Inc.(b)(c) | 113,001 | ||||||
48,751 | Inovio Pharmaceuticals, Inc.(b)(c) | 115,540 | ||||||
8,526 | Insmed, Inc.(b) | 118,852 | ||||||
8,513 | Invacare Corp. | 134,505 | ||||||
18,179 | Iridex Corp.(b) | 151,431 | ||||||
11,352 | Merit Medical Systems, Inc.(b) | 146,100 | ||||||
6,292 | Natus Medical, Inc.(b) | 156,230 | ||||||
14,092 | Nordion, Inc. (Canada)(b) | 163,185 | ||||||
30,344 | Pacific Biosciences of California, Inc.(b) | 134,121 | ||||||
5,802 | PharMerica Corp.(b) | 157,756 | ||||||
5,740 | Providence Service Corp. (The)(b) | 233,101 | ||||||
12,624 | Repligen Corp.(b) | 200,090 | ||||||
22,547 | Sinovac Biotech Ltd. (China)(b) | 133,929 | ||||||
7,973 | Stemline Therapeutics, Inc.(b) | 122,067 | ||||||
34,177 | Targacept, Inc.(b) | 151,746 | ||||||
7,554 | Tekmira Pharmaceuticals Corp. (Canada)(b) | 100,393 | ||||||
10,058 | Triple-S Management Corp., Class B (Puerto Rico)(b) | 150,669 | ||||||
9,990 | Vanda Pharmaceuticals, Inc.(b) | 139,161 | ||||||
8,278 | Zeltiq Aesthetics, Inc.(b) | 151,405 | ||||||
|
| |||||||
5,477,348 | ||||||||
|
| |||||||
Industrials—16.1% | ||||||||
8,081 | Aceto Corp. | 176,812 | ||||||
8,544 | Adept Technology, Inc.(b) | 102,186 | ||||||
16,464 | Aegean Marine Petroleum Network, Inc. (Greece) | 151,963 | ||||||
20,680 | Air Transport Services Group, Inc.(b) | 161,924 | ||||||
2,988 | Alamo Group, Inc. | 158,723 | ||||||
21,820 | ARC Document Solutions, Inc.(b) | 139,648 | ||||||
4,727 | ARC Group Worldwide, Inc.(b)(c) | 195,792 | ||||||
4,393 | ArcBest Corp. | 173,172 | ||||||
5,460 | Argan, Inc. | 146,164 | ||||||
26,100 | Arotech Corp.(b)(c) | 90,567 | ||||||
36,895 | Ballard Power Systems, Inc. (Canada)(b)(c) | 135,036 | ||||||
25,727 | Baltic Trading Ltd. | 154,105 | ||||||
13,285 | Broadwind Energy, Inc.(b) | 179,215 | ||||||
17,723 | CBIZ, Inc.(b) | 151,886 | ||||||
9,466 | CDI Corp. | 145,019 | ||||||
9,785 | Ceco Environmental Corp. | 155,484 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
41,308 | China Recycling Energy Corp.(b)(c) | $ | 128,468 | |||||
6,060 | Columbus McKinnon Corp.(b) | 160,529 | ||||||
16,073 | Covenant Transport Group, Inc., Class A(b) | 164,748 | ||||||
12,488 | CPI Aerostructures, Inc.(b) | 168,213 | ||||||
21,645 | Danaos Corp. (Greece)(b) | 125,974 | ||||||
6,478 | Ducommun, Inc.(b) | 157,221 | ||||||
40,687 | Eagle Bulk Shipping, Inc.(b)(c) | 118,806 | ||||||
3,604 | Engility Holdings, Inc.(b) | 157,279 | ||||||
9,797 | Ennis, Inc. | 146,563 | ||||||
8,407 | Erickson Air-Crane, Inc.(b)(c) | 132,915 | ||||||
32,468 | Fuel Tech, Inc.(b) | 197,730 | ||||||
16,531 | Furmanite Corp.(b) | 173,245 | ||||||
8,603 | Gibraltar Industries, Inc.(b) | 146,939 | ||||||
37,319 | Global Ship Lease, Inc., Class A (United Kingdom)(b) | 141,812 | ||||||
13,596 | Griffon Corp. | 144,661 | ||||||
11,274 | Hardinge, Inc. | 150,621 | ||||||
11,629 | Hawaiian Holdings, Inc.(b) | 168,039 | ||||||
30,572 | Highpower International, Inc. (China)(b)(c) | 144,606 | ||||||
29,516 | Hill International, Inc.(b) | 198,348 | ||||||
4,078 | ICF International, Inc.(b) | 158,920 | ||||||
5,514 | International Shipholding Corp. | 148,547 | ||||||
21,559 | Jinpan International Ltd. (China) | 158,890 | ||||||
4,451 | Kadant, Inc. | 154,672 | ||||||
6,841 | Kelly Services, Inc., Class A | 144,071 | ||||||
21,530 | Kratos Defense & Security Solutions, Inc.(b) | 155,447 | ||||||
10,191 | LS Starrett Co. (The), Class A | 159,183 | ||||||
9,959 | Manitex International, Inc.(b) | 163,925 | ||||||
7,544 | Marten Transport Ltd. | 176,982 | ||||||
11,928 | Mfri, Inc.(b) | 129,896 | ||||||
4,638 | Multi-Color Corp. | 161,634 | ||||||
8,700 | Navigant Consulting, Inc.(b) | 146,160 | ||||||
8,241 | NN, Inc. | 161,276 | ||||||
4,489 | Northwest Pipe Co.(b) | 160,572 | ||||||
22,392 | Orion Energy Systems, Inc.(b) | 118,678 | ||||||
8,166 | P.A.M. Transportation Services, Inc.(b) | 203,252 | ||||||
23,699 | Paragon Shipping, Inc., Class A (Greece)(b)(c) | 132,951 | ||||||
2,891 | Park-Ohio Holdings Corp.(b) | 168,806 | ||||||
3,662 | Patrick Industries, Inc.(b) | 146,736 | ||||||
6,926 | PowerSecure International, Inc.(b) | 153,965 | ||||||
17,761 | Republic Airways Holdings, Inc.(b) | 147,594 | ||||||
17,052 | Safe Bulkers, Inc. (Greece)(c) | 138,462 | ||||||
4,249 | Saia, Inc.(b) | 174,931 | ||||||
12,723 | SkyWest, Inc. | 147,587 | ||||||
5,544 | Sparton Corp.(b) | 150,575 | ||||||
11,376 | Star Bulk Carriers Corp. (Greece)(b) | �� | 135,147 | |||||
21,056 | Supreme Industries, Inc., Class A(b) | 119,388 | ||||||
52,368 | Ultrapetrol Bahamas Ltd. (Argentina)(b) | 148,201 | ||||||
3,080 | VSE Corp. | 192,408 | ||||||
7,931 | Willis Lease Finance Corp.(b) | 159,889 | ||||||
|
| |||||||
9,963,158 | ||||||||
|
| |||||||
Information Technology—15.6% | ||||||||
11,219 | Alliance Fiber Optic Products, Inc.(c) | 215,629 | ||||||
6,078 | Ambarella Inc.(b)(c) | 151,038 | ||||||
13,339 | Amtech Systems, Inc.(b) | 114,049 | ||||||
22,392 | AudioCodes Ltd. (Israel)(b) | 127,858 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 74 |
|
PowerShares Zacks Micro Cap Portfolio (PZI) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
13,060 | Autobytel, Inc.(b) | $ | 162,466 | |||||
75,507 | Axcelis Technologies, Inc.(b) | 135,158 | ||||||
7,413 | Bel Fuse, Inc., Class B | 161,307 | ||||||
6,670 | Black Box Corp. | 141,804 | ||||||
8,245 | Blucora, Inc.(b) | 158,716 | ||||||
14,853 | Brooks Automation, Inc. | 151,946 | ||||||
43,994 | Camtek Ltd. (Israel)(b)(c) | 136,821 | ||||||
35,138 | China Information Technology, Inc. (China)(b) | 142,660 | ||||||
7,359 | ChipMOS TECHNOLOGIES Bermuda Ltd. (Taiwan) | 154,833 | ||||||
7,031 | Clearfield, Inc.(b) | 110,809 | ||||||
15,838 | Clearone, Inc.(b) | 160,914 | ||||||
5,095 | Comtech Telecommunications Corp. | 161,766 | ||||||
7,775 | CTS Corp. | 138,317 | ||||||
5,986 | Datawatch Corp.(b) | 80,991 | ||||||
9,314 | Digital River, Inc.(b) | 142,411 | ||||||
41,948 | Dot Hill Systems Corp.(b) | 173,245 | ||||||
18,789 | DSP Group, Inc.(b) | 149,561 | ||||||
21,967 | Emulex Corp.(b) | 157,064 | ||||||
52,537 | Envivio, Inc.(b) | 139,748 | ||||||
27,990 | Extreme Networks, Inc.(b) | 160,103 | ||||||
25,405 | FormFactor, Inc.(b) | 146,079 | ||||||
22,737 | Harmonic, Inc.(b) | 159,841 | ||||||
28,135 | Imation Corp.(b) | 121,543 | ||||||
10,440 | Integrated Silicon Solution, Inc.(b) | 150,962 | ||||||
16,736 | Intevac, Inc.(b) | 134,725 | ||||||
15,869 | IntraLinks Holdings, Inc.(b) | 145,201 | ||||||
14,303 | IXYS Corp. | 154,329 | ||||||
20,707 | Lattice Semiconductor Corp.(b) | 174,353 | ||||||
23,734 | Livedeal, Inc.(b)(c) | 105,379 | ||||||
18,220 | LTX-Credence Corp.(b) | 175,459 | ||||||
15,446 | Marchex, Inc., Class B | 142,876 | ||||||
49,797 | Meetme, Inc.(b)(c) | 138,436 | ||||||
12,289 | Mercury Systems, Inc.(b) | 171,554 | ||||||
38,378 | ModusLink Global Solutions, Inc.(b)(c) | 155,047 | ||||||
21,703 | Monster Worldwide, Inc.(b) | 149,534 | ||||||
15,272 | NCI, Inc., Class A(b) | 152,262 | ||||||
20,472 | NeoPhotonics Corp.(b) | 118,123 | ||||||
56,368 | Newtek Business Services, Inc.(b) | 155,576 | ||||||
52,368 | Oclaro, Inc.(b) | 178,051 | ||||||
63,167 | On Track Innovations Ltd. (Israel)(b) | 145,284 | ||||||
9,039 | Oplink Communications, Inc.(b) | 154,929 | ||||||
10,548 | Orbotech Ltd. (Israel)(b) | 155,478 | ||||||
7,989 | PC Connection, Inc. | 159,860 | ||||||
16,599 | PCM, Inc.(b) | 172,962 | ||||||
13,383 | Perceptron, Inc. | 157,919 | ||||||
8,959 | Perficient, Inc.(b) | 163,681 | ||||||
20,733 | Pericom Semiconductor Corp.(b) | 167,315 | ||||||
19,032 | Photronics, Inc.(b) | 165,198 | ||||||
14,379 | Rubicon Technology, Inc.(b)(c) | 145,659 | ||||||
20,017 | Sapiens International Corp. NV (Curacao)(b) | 157,534 | ||||||
18,877 | ShoreTel, Inc.(b) | 142,521 | ||||||
7,437 | Sierra Wireless, Inc. (Canada)(b)(c) | 160,342 | ||||||
34,105 | Sigma Designs, Inc.(b) | 128,576 | ||||||
2,617 | Silicom Ltd. (Israel) | 126,925 | ||||||
9,346 | Super Micro Computer, Inc.(b) | 190,285 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
22,516 | TechTarget, Inc.(b) | $ | 144,553 | |||||
19,212 | TTM Technologies, Inc.(b) | 151,583 | ||||||
12,345 | Ultra Clean Holdings, Inc.(b) | 105,179 | ||||||
9,341 | Vishay Precision Group, Inc.(b) | 151,604 | ||||||
43,994 | Westell Technologies, Inc., Class A(b) | 143,420 | ||||||
38,469 | Zhone Technologies, Inc.(b)(c) | 106,559 | ||||||
|
| |||||||
9,655,910 | ||||||||
|
| |||||||
Materials—2.3% | ||||||||
12,966 | Core Molding Technologies, Inc.(b) | 155,722 | ||||||
67,082 | Gulf Resources, Inc. (China)(b) | 123,431 | ||||||
4,026 | Hi-Crush Partners LP | 163,415 | ||||||
9,652 | Horsehead Holding Corp.(b) | 150,475 | ||||||
4,785 | Materion Corp. | 161,015 | ||||||
48,172 | Nevsun Resources Ltd. (Canada) | 175,346 | ||||||
5,656 | Olympic Steel, Inc. | 149,092 | ||||||
5,550 | Suncoke Energy Partners LP | 163,170 | ||||||
6,908 | US Concrete, Inc.(b) | 170,075 | ||||||
|
| |||||||
1,411,741 | ||||||||
|
| |||||||
Telecommunication Services—1.4% | ||||||||
14,228 | General Communication, Inc., Class A(b) | 148,540 | ||||||
5,698 | Hawaiian Telcom Holdco, Inc.(b) | 151,681 | ||||||
11,173 | Inteliquent, Inc. | 152,400 | ||||||
21,616 | Iridium Communications, Inc.(b) | 144,179 | ||||||
5,028 | Shenandoah Telecommunications Co. | 140,935 | ||||||
8,934 | USA Mobility, Inc. | 153,039 | ||||||
|
| |||||||
890,774 | ||||||||
|
| |||||||
Utilities—0.7% | ||||||||
12,317 | Consolidated Water Co. Ltd. (Cayman Islands) | 143,124 | ||||||
16,283 | Genie Energy Ltd., Class B(b) | 131,892 | ||||||
27,750 | Star Gas Partners LP | 176,212 | ||||||
|
| |||||||
451,228 | ||||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $60,149,535)—99.9% | 61,725,760 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—5.5% | ||||||||
3,407,046 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $3,407,046) | 3,407,046 | ||||||
|
| |||||||
Total Investments (Cost $63,556,581)—105.4% | 65,132,806 | |||||||
Other assets less liabilities—(5.4)% | (3,351,275 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 61,781,531 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 75 |
|
PowerShares Zacks Micro Cap Portfolio (PZI) (continued)
April 30, 2014
Notes | to Schedule of Investments: |
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Citibank | $ | 3,172,639 | $ | (3,172,639 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 76 |
|
(This Page Intentionally Left Blank)
Statements of Assets and Liabilities
April 30, 2014
PowerShares Dynamic Large Cap Growth Portfolio (PWB) | PowerShares Dynamic Large Cap Value Portfolio (PWV) | PowerShares Fundamental Pure Large Core Portfolio (PXLC) | PowerShares Fundamental Pure Large Growth Portfolio (PXLG) | |||||||||||||
Assets: | ||||||||||||||||
Unaffiliated investments, at value(a). | $ | 285,605,787 | $ | 800,952,461 | $ | 40,751,078 | $ | 106,236,192 | ||||||||
Affiliated investments, at value | 134,194 | 78,211 | 40,900 | 122,837 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at value | 285,739,981 | 801,030,672 | 40,791,978 | 106,359,029 | ||||||||||||
Foreign currencies, at value | — | — | — | — | ||||||||||||
Receivables: | ||||||||||||||||
Investments sold | 6,426,016 | — | — | — | ||||||||||||
Dividends | 129,692 | 626,576 | 40,838 | 47,889 | ||||||||||||
Foreign tax reclaims | — | — | — | — | ||||||||||||
Security lending | — | — | — | — | ||||||||||||
Expenses absorbed | — | — | — | — | ||||||||||||
Other assets | 3,329 | 5,435 | 11,486 | 40,077 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Assets | 292,299,018 | 801,662,683 | 40,844,302 | 106,446,995 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Liabilities: | ||||||||||||||||
Due to custodian | — | — | — | — | ||||||||||||
Payables: | ||||||||||||||||
Shares repurchased | 6,383,040 | — | — | — | ||||||||||||
Investments purchased | — | — | — | — | ||||||||||||
Collateral upon return of securities loaned | — | — | — | — | ||||||||||||
Accrued advisory fees | 120,406 | 320,468 | 3,736 | 21,464 | ||||||||||||
Accrued trustees’ and officer’s fees | 26,422 | 31,743 | 11,774 | 7,317 | ||||||||||||
Accrued expenses | 94,592 | 222,569 | 58,396 | 96,490 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Liabilities | 6,624,460 | 574,780 | 73,906 | 125,271 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 285,674,558 | $ | 801,087,903 | $ | 40,770,396 | $ | 106,321,724 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets Consist of: | ||||||||||||||||
Shares of beneficial interest | $ | 519,415,454 | $ | 835,613,999 | $ | 45,802,542 | $ | 90,775,115 | ||||||||
Undistributed net investment income | 197,491 | 1,589,571 | 30,948 | 202,298 | ||||||||||||
Undistributed net realized gain (loss) | (257,303,442 | ) | (147,998,068 | ) | (10,822,366 | ) | (1,125,458 | ) | ||||||||
Net unrealized appreciation | 23,365,055 | 111,882,401 | 5,759,272 | 16,469,769 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 285,674,558 | $ | 801,087,903 | $ | 40,770,396 | $ | 106,321,724 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 11,150,000 | 27,150,000 | 1,100,000 | 3,600,001 | ||||||||||||
Net asset value | $ | 25.62 | $ | 29.51 | $ | 37.06 | $ | 29.53 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Market price | $ | 25.62 | $ | 29.49 | $ | 37.08 | $ | 29.52 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Unaffiliated investments, at cost | $ | 262,240,732 | $ | 689,070,060 | $ | 34,991,806 | $ | 89,766,423 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Affiliated investments, at cost | $ | 134,194 | $ | 78,211 | $ | 40,900 | $ | 122,837 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at cost | $ | 262,374,926 | $ | 689,148,271 | $ | 35,032,706 | $ | 89,889,260 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Foreign currencies, at cost | $ | — | $ | — | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
(a) Includes securities on loan with an aggregate value of | $ | — | $ | — | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 78 |
|
PowerShares Fundamental Pure Large Value Portfolio (PXLV) | PowerShares Fundamental Pure Mid Core Portfolio (PXMC) | PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) | PowerShares Fundamental Pure Mid Value Portfolio (PXMV) | PowerShares Fundamental Pure Small Core Portfolio (PXSC) | PowerShares Fundamental Pure Small Growth Portfolio (PXSG) | PowerShares Fundamental Pure Small Value Portfolio (PXSV) | PowerShares Zacks Micro Cap Portfolio (PZI) | |||||||||||||||||||||||
$ | 14,695,246 | $ | 30,494,757 | $ | 91,139,849 | $ | 42,708,760 | $ | 14,780,556 | $ | 29,871,276 | $ | 65,301,615 | $ | 61,725,760 | |||||||||||||||
17,692 | 422,145 | 487,205 | 1,785,849 | 43,639 | 1,236,169 | 2,083,214 | 3,407,046 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
14,712,938 | 30,916,902 | 91,627,054 | 44,494,609 | 14,824,195 | 31,107,445 | 67,384,829 | 65,132,806 | |||||||||||||||||||||||
— | — | — | 150,595 | — | — | — | — | |||||||||||||||||||||||
— | — | — | 216,850 | 7,219 | 24,116 | — | 259,773 | |||||||||||||||||||||||
25,876 | 5,978 | 29,214 | 27,250 | 5,415 | 12,253 | 37,147 | 10,816 | |||||||||||||||||||||||
— | — | — | — | — | — | — | 138 | |||||||||||||||||||||||
— | — | — | 3,397 | — | 2,519 | 12,703 | 26,371 | |||||||||||||||||||||||
5,960 | 1,889 | — | 2,600 | 7,117 | 2,942 | — | — | |||||||||||||||||||||||
14,406 | 25,852 | 14,177 | 3,332 | 5,204 | 36,724 | 8,389 | 2,935 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
14,759,180 | 30,950,621 | 91,670,445 | 44,898,633 | 14,849,150 | 31,185,999 | 67,443,068 | 65,432,839 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
— | — | — | 66,772 | — | — | — | 140,561 | |||||||||||||||||||||||
— | — | — | — | — | — | — | — | |||||||||||||||||||||||
— | — | — | 268,118 | 5,805 | 29,760 | — | — | |||||||||||||||||||||||
— | — | — | 1,785,849 | — | 1,186,531 | 1,980,542 | 3,407,046 | |||||||||||||||||||||||
— | — | 23,671 | — | — | — | 187 | 17,314 | |||||||||||||||||||||||
6,305 | 11,282 | 18,617 | 12,609 | 10,938 | 12,159 | 13,711 | 13,506 | |||||||||||||||||||||||
52,155 | 72,192 | 73,018 | 56,320 | 48,761 | 85,338 | 72,847 | 72,881 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
58,460 | 83,474 | 115,306 | 2,189,668 | 65,504 | 1,313,788 | 2,067,287 | 3,651,308 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | 14,700,720 | $ | 30,867,147 | $ | 91,555,139 | $ | 42,708,965 | $ | 14,783,646 | $ | 29,872,211 | $ | 65,375,781 | $ | 61,781,531 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | 12,941,075 | $ | 37,846,610 | $ | 249,326,298 | $ | 80,502,922 | $ | 23,692,159 | $ | 76,643,733 | $ | 103,334,569 | $ | 151,403,203 | |||||||||||||||
47,012 | 39,889 | 197,674 | 59,531 | 21,797 | 173,520 | 76,309 | 365,535 | |||||||||||||||||||||||
(64,869 | ) | (10,838,717 | ) | (172,516,921 | ) | (45,132,064 | ) | (10,120,689 | ) | (50,659,974 | ) | (45,272,620 | ) | (91,563,432 | ) | |||||||||||||||
1,777,502 | 3,819,365 | 14,548,088 | 7,278,576 | 1,190,379 | 3,714,932 | 7,237,523 | 1,576,225 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | 14,700,720 | $ | 30,867,147 | $ | 91,555,139 | $ | 42,708,965 | $ | 14,783,646 | $ | 29,872,211 | $ | 65,375,781 | $ | 61,781,531 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
500,001 | 850,000 | 3,050,000 | 1,650,000 | 450,000 | 1,250,000 | 2,650,000 | 3,800,000 | |||||||||||||||||||||||
$ | 29.40 | $ | 36.31 | $ | 30.02 | $ | 25.88 | $ | 32.85 | $ | 23.90 | $ | 24.67 | $ | 16.26 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | 29.39 | $ | 36.25 | $ | 29.99 | $ | 25.87 | $ | 32.84 | $ | 23.89 | $ | 24.68 | $ | 16.25 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | 12,917,744 | $ | 26,726,869 | $ | 76,574,748 | $ | 35,443,864 | $ | 13,590,177 | $ | 26,156,344 | $ | 58,064,101 | $ | 60,149,535 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | 17,692 | $ | 370,668 | $ | 504,218 | $ | 1,785,849 | $ | 43,639 | $ | 1,236,169 | $ | 2,083,214 | $ | 3,407,046 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | 12,935,436 | $ | 27,097,537 | $ | 77,078,966 | $ | 37,229,713 | $ | 13,633,816 | $ | 27,392,513 | $ | 60,147,315 | $ | 63,556,581 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | — | $ | — | $ | — | $ | 136,915 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
$ | — | $ | — | $ | — | $ | 1,741,934 | $ | — | $ | 1,165,981 | $ | 1,901,168 | $ | 3,172,639 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 79 |
|
For the year ended April 30, 2014
PowerShares Dynamic Large Cap Growth Portfolio (PWB) | PowerShares Dynamic Large Cap Value Portfolio (PWV) | PowerShares Fundamental Pure Large Core Portfolio (PXLC) | PowerShares Fundamental Pure Large Growth Portfolio (PXLG) | |||||||||||||
Investment Income: | ||||||||||||||||
Unaffiliated dividend income | $ | 2,522,864 | $ | 18,056,739 | $ | 761,033 | $ | 2,102,480 | ||||||||
Affiliated dividend income | 26 | 54 | 10 | 10 | ||||||||||||
Securities lending income | — | — | — | — | ||||||||||||
Foreign withholding tax | — | — | — | (1,079 | ) | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Income | 2,522,890 | 18,056,793 | 761,043 | 2,101,411 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Expenses: | ||||||||||||||||
Advisory fees | 1,251,441 | 3,462,943 | 98,670 | 273,026 | ||||||||||||
Sub-licensing | 75,087 | 207,777 | 18,102 | 55,024 | ||||||||||||
Accounting & administration fees | 49,170 | 136,726 | 36,058 | 36,058 | ||||||||||||
Professional fees | 29,274 | 35,636 | 28,895 | 25,819 | ||||||||||||
Trustees’ and officer’s fees | 15,287 | 26,737 | 9,450 | 11,255 | ||||||||||||
Listing fee and expenses | 8,294 | 8,647 | 7,520 | 7,520 | ||||||||||||
Custodian & transfer agent fees | 3,646 | 9,990 | 3,447 | 5,500 | ||||||||||||
Other expenses | 19,088 | 50,776 | 2,924 | 8,582 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Expenses | 1,451,287 | 3,939,232 | 205,066 | 422,784 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Waivers | (179 | ) | (389 | ) | (72,442 | ) | (55,680 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Expenses | 1,451,108 | 3,938,843 | 132,624 | 367,104 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Investment Income | 1,071,782 | 14,117,950 | 628,419 | 1,734,307 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Realized and Unrealized Gain (Loss): | ||||||||||||||||
Net realized gain (loss) from: | ||||||||||||||||
Investment securities | 3,392,769 | (13,777,124 | ) | (52,976 | ) | (1,099,111 | ) | |||||||||
In-kind redemptions | 57,795,794 | 106,835,740 | 3,359,973 | 3,896,255 | ||||||||||||
Foreign currencies | — | — | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized gain | 61,188,563 | 93,058,616 | 3,306,997 | 2,797,144 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Change in net unrealized appreciation (depreciation) on: | ||||||||||||||||
Investment securities | (17,475,378 | ) | 14,932,987 | 2,610,982 | 13,154,514 | |||||||||||
Foreign currencies | — | — | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net change in unrealized appreciation (depreciation) | (17,475,378 | ) | 14,932,987 | 2,610,982 | 13,154,514 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized and unrealized gain | 43,713,185 | 107,991,603 | 5,917,979 | 15,951,658 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | $ | 44,784,967 | $ | 122,109,553 | $ | 6,546,398 | $ | 17,685,965 | ||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 80 |
|
PowerShares Fundamental Pure Large Value Portfolio (PXLV) | PowerShares Fundamental Pure Mid Core Portfolio (PXMC) | PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) | PowerShares Fundamental Pure Mid Value Portfolio (PXMV) | PowerShares Fundamental Pure Small Core Portfolio (PXSC) | PowerShares Fundamental Pure Small Growth Portfolio (PXSG) | PowerShares Fundamental Pure Small Value Portfolio (PXSV) | PowerShares Zacks Micro Cap Portfolio (PZI) | |||||||||||||||||||||||
$ | 334,068 | $ | 407,072 | $ | 1,354,992 | $ | 705,158 | $ | 228,901 | $ | 335,652 | $ | 941,026 | $ | 908,167 | |||||||||||||||
7 | 8,739 | 12,527 | 1 | 11 | 15,579 | 14 | 14 | |||||||||||||||||||||||
— | — | — | 9,876 | — | 10,562 | 35,372 | 175,006 | |||||||||||||||||||||||
— | (399 | ) | — | — | (646 | ) | (28 | ) | (537 | ) | (1,433 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
334,075 | 415,412 | 1,367,519 | 715,035 | 228,266 | 361,765 | 975,875 | 1,081,754 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
35,699 | 76,415 | 251,557 | 106,133 | 45,815 | 81,451 | 166,644 | 271,662 | |||||||||||||||||||||||
6,646 | 14,158 | 46,534 | 19,338 | 8,523 | 14,892 | 30,598 | 54,361 | |||||||||||||||||||||||
36,058 | 36,058 | 36,058 | 36,058 | 36,058 | 36,058 | 36,058 | 36,058 | |||||||||||||||||||||||
24,456 | 28,209 | 33,893 | 30,834 | 28,074 | 32,688 | 27,399 | 20,832 | |||||||||||||||||||||||
8,915 | 9,289 | 11,034 | 9,547 | 9,027 | 9,263 | 10,101 | 9,930 | |||||||||||||||||||||||
7,520 | 8,294 | 7,520 | 7,520 | 7,520 | 7,520 | 7,520 | 8,647 | |||||||||||||||||||||||
5,263 | 5,403 | 5,741 | 13,056 | 6,124 | 9,235 | 23,613 | 10,794 | |||||||||||||||||||||||
5,035 | 4,681 | (1,429 | ) | 4,968 | 7,241 | 6,622 | 10,726 | 18,314 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
129,592 | 182,507 | 390,908 | 227,454 | 148,382 | 197,729 | 312,659 | 430,598 | |||||||||||||||||||||||
|
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|
| |||||||||||||||
(81,627 | ) | (79,806 | ) | (52,719 | ) | (84,727 | ) | (86,835 | ) | (88,267 | ) | (88,634 | ) | (50,309 | ) | |||||||||||||||
|
|
|
|
|
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|
|
|
|
|
|
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| |||||||||||||||
47,965 | 102,701 | 338,189 | 142,727 | 61,547 | 109,462 | 224,025 | 380,289 | |||||||||||||||||||||||
|
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|
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|
|
|
|
| |||||||||||||||
286,110 | 312,711 | 1,029,330 | 572,308 | 166,719 | 252,303 | 751,850 | 701,465 | |||||||||||||||||||||||
|
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|
|
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|
|
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| |||||||||||||||
(47,318 | ) | (316,435 | ) | (1,101,744 | ) | (61,583 | ) | (314,704 | ) | (780,799 | ) | 75,184 | (485,536 | ) | ||||||||||||||||
788,535 | 2,850,773 | 7,843,778 | 4,058,270 | 3,025,277 | 3,577,003 | 8,406,488 | 10,618,066 | |||||||||||||||||||||||
— | — | — | — | — | — | 10 | (1,711 | ) | ||||||||||||||||||||||
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| |||||||||||||||
741,217 | 2,534,338 | 6,742,034 | 3,996,687 | 2,710,573 | 2,796,204 | 8,481,682 | 10,130,819 | |||||||||||||||||||||||
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| |||||||||||||||
1,060,399 | 2,159,025 | 5,747,374 | 3,633,213 | (109,024 | ) | 2,457,284 | 3,919,692 | (1,735,740 | ) | |||||||||||||||||||||
— | — | — | 7,403 | — | — | 9 | 1,000 | |||||||||||||||||||||||
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| |||||||||||||||
1,060,399 | 2,159,025 | 5,747,374 | 3,640,616 | (109,024 | ) | 2,457,284 | 3,919,701 | (1,734,740 | ) | |||||||||||||||||||||
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| |||||||||||||||
1,801,616 | 4,693,363 | 12,489,408 | 7,637,303 | 2,601,549 | 5,253,488 | 12,401,383 | 8,396,079 | |||||||||||||||||||||||
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| |||||||||||||||
$ | 2,087,726 | $ | 5,006,074 | $ | 13,518,738 | $ | 8,209,611 | $ | 2,768,268 | $ | 5,505,791 | $ | 13,153,233 | $ | 9,097,544 | |||||||||||||||
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| 81 |
|
Statements of Changes in Net Assets
For the years ended April 30, 2014 and 2013
PowerShares Dynamic Large Cap Growth Portfolio (PWB) | PowerShares Dynamic Large Cap Value Portfolio (PWV) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 1,071,782 | $ | 2,024,457 | $ | 14,117,950 | $ | 10,894,233 | ||||||||
Net realized gain | 61,188,563 | 21,861,235 | 93,058,616 | 37,231,755 | ||||||||||||
Net change in unrealized appreciation (depreciation) | (17,475,378 | ) | 2,739,360 | 14,932,987 | 57,544,945 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | 44,784,967 | 26,625,052 | 122,109,553 | 105,670,933 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (1,108,791 | ) | (1,990,554 | ) | (13,897,107 | ) | (10,900,743 | ) | ||||||||
Net realized gains | — | — | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total distributions to shareholders | (1,108,791 | ) | (1,990,554 | ) | (13,897,107 | ) | (10,900,743 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 323,660,690 | 166,875,738 | 868,969,018 | 450,245,291 | ||||||||||||
Value of shares repurchased | (294,559,223 | ) | (169,626,504 | ) | (750,918,793 | ) | (389,930,643 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | 29,101,467 | (2,750,766 | ) | 118,050,225 | 60,314,648 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | 72,777,643 | 21,883,732 | 226,262,671 | 155,084,838 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 212,896,915 | 191,013,183 | 574,825,232 | 419,740,394 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
End of year | $ | 285,674,558 | $ | 212,896,915 | $ | 801,087,903 | $ | 574,825,232 | ||||||||
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|
|
|
|
| |||||||||
Undistributed net investment income at end of year | $ | 197,491 | $ | 234,500 | $ | 1,589,571 | $ | 1,368,728 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 13,350,000 | 8,950,000 | 32,150,000 | 20,750,000 | ||||||||||||
Shares repurchased | (12,200,000 | ) | (9,150,000 | ) | (27,800,000 | ) | (18,200,000 | ) | ||||||||
Shares outstanding, beginning of year | 10,000,000 | 10,200,000 | 22,800,000 | 20,250,000 | ||||||||||||
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|
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|
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|
|
| |||||||||
Shares outstanding, end of year | 11,150,000 | 10,000,000 | 27,150,000 | 22,800,000 | ||||||||||||
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|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 82 |
|
PowerShares Fundamental Pure Large Core Portfolio (PXLC) | PowerShares Fundamental Pure Large Growth Portfolio (PXLG) | PowerShares Fundamental Pure Large Value Portfolio (PXLV) | PowerShares Fundamental Pure Mid Core Portfolio (PXMC) | |||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
$ | 628,419 | $ | 608,250 | $ | 1,734,307 | $ | 384,170 | $ | 286,110 | $ | 141,166 | $ | 312,711 | $ | 283,696 | |||||||||||||||
3,306,997 | 2,361,514 | 2,797,144 | 1,834,815 | 741,217 | 882,558 | 2,534,338 | 941,088 | |||||||||||||||||||||||
2,610,982 | 1,527,836 | 13,154,514 | 3,127,962 | 1,060,399 | 211,524 | 2,159,025 | 1,551,100 | |||||||||||||||||||||||
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|
|
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|
|
| |||||||||||||||
6,546,398 | 4,497,600 | 17,685,965 | 5,346,947 | 2,087,726 | 1,235,248 | 5,006,074 | 2,775,884 | |||||||||||||||||||||||
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|
| |||||||||||||||
(612,506 | ) | (662,935 | ) | (2,133,201 | ) | (166,518 | ) | (263,618 | ) | (147,580 | ) | (309,864 | ) | (280,344 | ) | |||||||||||||||
— | — | (65,835 | ) | — | (7,335 | ) | — | — | — | |||||||||||||||||||||
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| |||||||||||||||
(612,506 | ) | (662,935 | ) | (2,199,036 | ) | (166,518 | ) | (270,953 | ) | (147,580 | ) | (309,864 | ) | (280,344 | ) | |||||||||||||||
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| |||||||||||||||
21,427,256 | 10,362,143 | 30,772,536 | 97,586,544 | 8,206,110 | 2,477,129 | 17,246,882 | 2,985,502 | |||||||||||||||||||||||
(14,464,293 | ) | (11,649,294 | ) | (22,754,152 | ) | (24,390,578 | ) | (2,871,073 | ) | (4,164,302 | ) | (10,844,266 | ) | (4,335,466 | ) | |||||||||||||||
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|
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| |||||||||||||||
6,962,963 | (1,287,151 | ) | 8,018,384 | 73,195,966 | 5,335,037 | (1,687,173 | ) | 6,402,616 | (1,349,964 | ) | ||||||||||||||||||||
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| |||||||||||||||
12,896,855 | 2,547,514 | 23,505,313 | 78,376,395 | 7,151,810 | (599,505 | ) | 11,098,826 | 1,145,576 | ||||||||||||||||||||||
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| |||||||||||||||
27,873,541 | 25,326,027 | 82,816,411 | 4,440,016 | 7,548,910 | 8,148,415 | 19,768,321 | 18,622,745 | |||||||||||||||||||||||
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| |||||||||||||||
$ | 40,770,396 | $ | 27,873,541 | $ | 106,321,724 | $ | 82,816,411 | $ | 14,700,720 | $ | 7,548,910 | $ | 30,867,147 | $ | 19,768,321 | |||||||||||||||
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| |||||||||||||||
$ | 30,948 | $ | 15,035 | $ | 202,298 | $ | 233,801 | $ | 47,012 | $ | 11,501 | $ | 39,889 | $ | 37,042 | |||||||||||||||
|
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|
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| |||||||||||||||
600,000 | 350,000 | 1,100,000 | 4,100,000 | 300,000 | 100,000 | 500,000 | 100,000 | |||||||||||||||||||||||
(400,000 | ) | (400,000 | ) | (800,000 | ) | (1,000,000 | ) | (100,000 | ) | (200,000 | ) | (300,000 | ) | (150,000 | ) | |||||||||||||||
900,000 | 950,000 | 3,300,001 | 200,001 | 300,001 | 400,001 | 650,000 | 700,000 | |||||||||||||||||||||||
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| |||||||||||||||
1,100,000 | 900,000 | 3,600,001 | 3,300,001 | 500,001 | 300,001 | 850,000 | 650,000 | |||||||||||||||||||||||
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|
|
| 83 |
|
Statements of Changes in Net Assets (continued)
For the years ended April 30, 2014 and 2013
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) | PowerShares Fundamental Pure Mid Value Portfolio (PXMV) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 1,029,330 | $ | 904,339 | $ | 572,308 | $ | 607,661 | ||||||||
Net realized gain | 6,742,034 | 3,643,371 | 3,996,687 | 2,891,074 | ||||||||||||
Net change in unrealized appreciation (depreciation) | 5,747,374 | 7,042,985 | 3,640,616 | 2,887,178 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | 13,518,738 | 11,590,695 | 8,209,611 | 6,385,913 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (1,178,058 | ) | (795,069 | ) | (549,786 | ) | (648,717 | ) | ||||||||
Net realized gains | — | — | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total distributions to shareholders | (1,178,058 | ) | (795,069 | ) | (549,786 | ) | (648,717 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 24,086,636 | 16,376,600 | 18,202,301 | 4,102,250 | ||||||||||||
Value of shares repurchased | (26,973,280 | ) | (32,274,525 | ) | (11,473,851 | ) | (13,926,465 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | (2,886,644 | ) | (15,897,925 | ) | 6,728,450 | (9,824,215 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | 9,454,036 | (5,102,299 | ) | 14,388,275 | (4,087,019 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 82,101,103 | 87,203,402 | 28,320,690 | 32,407,709 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
End of year | $ | 91,555,139 | $ | 82,101,103 | $ | 42,708,965 | $ | 28,320,690 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Undistributed net investment income at end of year | $ | 197,674 | $ | 346,402 | $ | 59,531 | $ | 37,009 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 800,000 | 650,000 | 750,000 | 200,000 | ||||||||||||
Shares repurchased | (900,000 | ) | (1,350,000 | ) | (450,000 | ) | (750,000 | ) | ||||||||
Shares outstanding, beginning of year | 3,150,000 | 3,850,000 | 1,350,000 | 1,900,000 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding, end of year | 3,050,000 | 3,150,000 | 1,650,000 | 1,350,000 | ||||||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 84 |
|
PowerShares Fundamental Pure Small Core Portfolio (PXSC) | PowerShares Fundamental Pure Small Growth Portfolio (PXSG) | PowerShares Fundamental Pure Small Value Portfolio (PXSV) | PowerShares Zacks Micro Cap Portfolio (PZI) | |||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
$ | 166,719 | $ | 259,345 | $ | 252,303 | $ | 196,216 | $ | 751,850 | $ | 873,607 | $ | 701,465 | $ | 531,305 | |||||||||||||||
2,710,573 | 810,582 | 2,796,204 | 1,224,815 | 8,481,682 | 5,434,528 | 10,130,819 | 4,356,483 | |||||||||||||||||||||||
(109,024 | ) | 1,020,540 | 2,457,284 | 1,497,396 | 3,919,701 | 2,795,165 | (1,734,740 | ) | 1,125,876 | |||||||||||||||||||||
|
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|
|
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|
|
|
|
|
| |||||||||||||||
2,768,268 | 2,090,467 | 5,505,791 | 2,918,427 | 13,153,233 | 9,103,300 | 9,097,544 | 6,013,664 | |||||||||||||||||||||||
|
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|
|
|
|
| |||||||||||||||
(198,389 | ) | (259,833 | ) | (268,388 | ) | (218,960 | ) | (729,968 | ) | (957,949 | ) | (512,267 | ) | (557,741 | ) | |||||||||||||||
— | — | — | — | — | — | — | — | |||||||||||||||||||||||
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| |||||||||||||||
(198,389 | ) | (259,833 | ) | (268,388 | ) | (218,960 | ) | (729,968 | ) | (957,949 | ) | (512,267 | ) | (557,741 | ) | |||||||||||||||
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| |||||||||||||||
9,749,513 | 2,734,348 | 8,700,003 | 4,953,667 | 28,894,203 | 9,762,249 | 48,525,479 | 34,331,596 | |||||||||||||||||||||||
(12,825,382 | ) | (5,010,393 | ) | (10,711,283 | ) | (11,919,697 | ) | (24,025,732 | ) | (22,135,140 | ) | (37,384,029 | ) | (31,751,422 | ) | |||||||||||||||
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|
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| |||||||||||||||
(3,075,869 | ) | (2,276,045 | ) | (2,011,280 | ) | (6,966,030 | ) | 4,868,471 | (12,372,891 | ) | 11,141,450 | 2,580,174 | ||||||||||||||||||
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|
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| |||||||||||||||
(505,990 | ) | (445,411 | ) | 3,226,123 | (4,266,563 | ) | 17,291,736 | (4,227,540 | ) | 19,726,727 | 8,036,097 | |||||||||||||||||||
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| |||||||||||||||
15,289,636 | 15,735,047 | 26,646,088 | 30,912,651 | 48,084,045 | 52,311,585 | 42,054,804 | 34,018,707 | |||||||||||||||||||||||
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| |||||||||||||||
$ | 14,783,646 | $ | 15,289,636 | $ | 29,872,211 | $ | 26,646,088 | $ | 65,375,781 | $ | 48,084,045 | $ | 61,781,531 | $ | 42,054,804 | |||||||||||||||
|
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| |||||||||||||||
$ | 21,797 | $ | 53,467 | $ | 173,520 | $ | 189,920 | $ | 76,309 | $ | 59,627 | $ | 365,535 | $ | 128,568 | |||||||||||||||
|
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| |||||||||||||||
300,000 | 100,000 | 350,000 | 250,000 | 1,150,000 | 500,000 | 3,050,000 | 2,700,000 | |||||||||||||||||||||||
(400,000 | ) | (200,000 | ) | (450,000 | ) | (650,000 | ) | (950,000 | ) | (1,250,000 | ) | (2,350,000 | ) | (2,600,000 | ) | |||||||||||||||
550,000 | 650,000 | 1,350,000 | 1,750,000 | 2,450,000 | 3,200,000 | 3,100,000 | 3,000,000 | |||||||||||||||||||||||
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|
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|
| |||||||||||||||
450,000 | �� | 550,000 | 1,250,000 | 1,350,000 | 2,650,000 | 2,450,000 | 3,800,000 | 3,100,000 | ||||||||||||||||||||||
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| 85 |
|
PowerShares Dynamic Large Cap Growth Portfolio (PWB)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 21.29 | $ | 18.73 | $ | 17.63 | $ | 14.91 | $ | 11.03 | ||||||||||
Net investment income(a) | 0.10 | 0.21 | 0.15 | 0.11 | 0.06 | |||||||||||||||
Net realized and unrealized gain on investments | 4.34 | 2.55 | 1.09 | 2.72 | 3.91 | |||||||||||||||
Total from investment operations | 4.44 | 2.76 | 1.24 | 2.83 | 3.97 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.11 | ) | (0.20 | ) | (0.14 | ) | (0.11 | ) | (0.09 | ) | ||||||||||
Net asset value at end of year | $ | 25.62 | $ | 21.29 | $ | 18.73 | $ | 17.63 | $ | 14.91 | ||||||||||
Market price at end of year(b) | $ | 25.62 | $ | 21.28 | $ | 18.72 | $ | 17.63 | $ | 14.91 | ||||||||||
Net Asset Value Total Return(c) | 20.91 | % | 14.91 | % | 7.18 | % | 19.08 | % | 36.15 | % | ||||||||||
Market Price Total Return(c) | 20.96 | % | 14.92 | % | 7.12 | % | 19.08 | % | 36.15 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 285,675 | $ | 212,897 | $ | 191,013 | $ | 196,574 | $ | 230,334 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.58 | % | 0.59 | % | 0.61 | % | 0.63 | % | 0.61 | % | ||||||||||
Expenses, prior to Waivers | 0.58 | % | 0.59 | % | 0.62 | % | 0.64 | % | 0.61 | % | ||||||||||
Net investment income, after Waivers | 0.43 | % | 1.08 | % | 0.89 | % | 0.73 | % | 0.45 | % | ||||||||||
Portfolio turnover rate(d) | 123 | % | 47 | % | 64 | % | 45 | % | 67 | % |
PowerShares Dynamic Large Cap Value Portfolio (PWV)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 25.21 | $ | 20.73 | $ | 20.35 | $ | 18.05 | $ | 13.54 | ||||||||||
Net investment income(a) | 0.55 | 0.52 | 0.46 | 0.40 | 0.39 | |||||||||||||||
Net realized and unrealized gain on investments | 4.30 | 4.48 | 0.38 | 2.33 | 4.52 | |||||||||||||||
Total from investment operations | 4.85 | 5.00 | 0.84 | 2.73 | 4.91 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.55 | ) | (0.52 | ) | (0.46 | ) | (0.43 | ) | (0.40 | ) | ||||||||||
Net asset value at end of year | $ | 29.51 | $ | 25.21 | $ | 20.73 | $ | 20.35 | $ | 18.05 | ||||||||||
Market price at end of year(b) | $ | 29.49 | $ | 25.22 | $ | 20.71 | $ | 20.36 | $ | 18.05 | ||||||||||
Net Asset Value Total Return(c) | 19.48 | % | 24.55 | % | 4.34 | % | 15.50 | % | 36.69 | % | ||||||||||
Market Price Total Return(c) | 19.35 | % | 24.72 | % | 4.20 | % | 15.49 | % | 36.67 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 801,088 | $ | 574,825 | $ | 419,740 | $ | 422,319 | $ | 349,265 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.57 | % | 0.59 | % | 0.59 | % | 0.61 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.57 | % | 0.59 | % | 0.59 | % | 0.61 | % | 0.60 | % | ||||||||||
Net investment income, after Waivers | 2.04 | % | 2.36 | % | 2.39 | % | 2.22 | % | 2.46 | % | ||||||||||
Portfolio turnover rate(d) | 103 | % | 58 | % | 41 | % | 40 | % | 47 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Fundamental Pure Large Core Portfolio (PXLC)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 30.97 | $ | 26.66 | $ | 26.42 | $ | 23.26 | $ | 17.56 | ||||||||||
Net investment income(a) | 0.63 | 0.65 | 0.57 | 0.37 | 0.27 | |||||||||||||||
Net realized and unrealized gain on investments | 6.03 | 4.35 | 0.32 | 3.16 | 5.74 | |||||||||||||||
Total from investment operations | 6.66 | 5.00 | 0.89 | 3.53 | 6.01 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.57 | ) | (0.69 | ) | (0.65 | ) | (0.37 | ) | (0.31 | ) | ||||||||||
Net asset value at end of year | $ | 37.06 | $ | 30.97 | $ | 26.66 | $ | 26.42 | $ | 23.26 | ||||||||||
Market price at end of year(b) | $ | 37.08 | $ | 30.98 | $ | 26.66 | $ | 26.42 | $ | 23.26 | ||||||||||
Net Asset Value Total Return(c) | 21.69 | % | 19.10 | % | 3.64 | % | 15.40 | % | 34.56 | % | ||||||||||
Market Price Total Return(c) | 21.72 | % | 19.15 | % | 3.64 | % | 15.40 | % | 34.64 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 40,770 | $ | 27,874 | $ | 25,326 | $ | 35,673 | $ | 38,376 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.43 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.60 | % | 0.80 | % | 0.90 | % | 0.99 | % | 0.88 | % | ||||||||||
Net investment income, after Waivers | 1.85 | % | 2.38 | % | 2.32 | % | 1.61 | % | 1.32 | % | ||||||||||
Portfolio turnover rate(d) | 38 | % | 43 | % | 58 | % | 41 | % | 62 | % |
PowerShares Fundamental Pure Large Growth Portfolio (PXLG)
Year Ended April 30, | For the Period June 13, 2011(e) Through April 30, 2012 | |||||||||||
2014 | 2013 | |||||||||||
Per Share Operating Performance: | ||||||||||||
Net asset value at beginning of year | $ | 25.10 | $ | 22.20 | $ | 20.00 | ||||||
Net investment income(a) | 0.50 | 0.39 | 0.28 | |||||||||
Net realized and unrealized gain on investments | 4.57 | 2.87 | 2.09 | |||||||||
Total from investment operations | 5.07 | 3.26 | 2.37 | |||||||||
Distributions to shareholders from: | ||||||||||||
Net investment income | (0.62 | ) | (0.36 | ) | (0.17 | ) | ||||||
Net realized gain capital gains | (0.02 | ) | — | — | ||||||||
Total distributions | (0.64 | ) | (0.36 | ) | (0.17 | ) | ||||||
Net asset value at end of year | $ | 29.53 | $ | 25.10 | $ | 22.20 | ||||||
Market price at end of year(b) | $ | 29.52 | $ | 25.08 | $ | 22.19 | ||||||
Net Asset Value Total Return(c) | 20.54 | % | 14.87 | % | 11.99 | %(f) | ||||||
Market Price Total Return(c) | 20.59 | % | 14.83 | % | 11.94 | %(f) | ||||||
Ratios/Supplemental Data: | ||||||||||||
Net assets at end of year (000’s omitted) | $ | 106,322 | $ | 82,816 | $ | 4,440 | ||||||
Ratio to average net assets of: | ||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.39 | %(g) | ||||||
Expenses, prior to Waivers | 0.45 | % | 0.79 | % | 7.69 | %(g) | ||||||
Net investment income, after Waivers | 1.84 | % | 1.63 | % | 1.54 | %(g) | ||||||
Portfolio turnover rate(d) | 22 | % | 90 | % | 3 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(e) | Commencement of Investment Operations. |
(f) | The net asset value total return from Fund Inception (June 16, 2011, the first day of trading on the Exchange) to April 30, 2012 was 13.81%. The market price total return from Fund Inception to April 30, 2012 was 13.87%. |
(g) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Fundamental Pure Large Value Portfolio (PXLV)
Year Ended April 30, | For the Period June 13, 2011(a) Through April 30, 2012 | |||||||||||
2014 | 2013 | |||||||||||
Per Share Operating Performance: | ||||||||||||
Net asset value at beginning of year | $ | 25.16 | $ | 20.37 | $ | 20.00 | ||||||
Net investment income(b) | 0.63 | 0.52 | 0.39 | |||||||||
Net realized and unrealized gain on investments | 4.17 | 4.77 | 0.33 | |||||||||
Total from investment operations | 4.80 | 5.29 | 0.72 | |||||||||
Distributions to shareholders from: | ||||||||||||
Net investment income | (0.54 | ) | (0.50 | ) | (0.35 | ) | ||||||
Net realized gains | (0.02 | ) | — | — | ||||||||
Total distributions | (0.56 | ) | (0.50 | ) | (0.35 | ) | ||||||
Net asset value at end of year | $ | 29.40 | $ | 25.16 | $ | 20.37 | ||||||
Market price at end of year(c) | $ | 29.39 | $ | 25.16 | $ | 20.35 | ||||||
Net Asset Value Total Return(d) | 19.27 | % | 26.41 | % | 3.80 | %(e) | ||||||
Market Price Total Return(d) | 19.23 | % | 26.53 | % | 3.70 | %(e) | ||||||
Ratios/Supplemental Data: | ||||||||||||
Net assets at end of year (000’s omitted) | $ | 14,701 | $ | 7,549 | $ | 8,148 | ||||||
Ratio to average net assets of: | ||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.39 | %(f) | ||||||
Expenses, prior to Waivers | 1.05 | % | 2.10 | % | 2.87 | %(f) | ||||||
Net investment income, after Waivers | 2.32 | % | 2.43 | % | 2.38 | %(f) | ||||||
Portfolio turnover rate(g) | 23 | % | 9 | % | 2 | % |
PowerShares Fundamental Pure Mid Core Portfolio (PXMC)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 30.41 | $ | 26.60 | $ | 27.15 | $ | 23.05 | $ | 16.30 | ||||||||||
Net investment income(b) | 0.40 | 0.43 | 0.29 | 0.21 | 0.18 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 5.90 | 3.80 | (0.57 | ) | 4.10 | 6.73 | ||||||||||||||
Total from investment operations | 6.30 | 4.23 | (0.28 | ) | 4.31 | 6.91 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.40 | ) | (0.42 | ) | (0.27 | ) | (0.21 | ) | (0.16 | ) | ||||||||||
Net asset value at end of year | $ | 36.31 | $ | 30.41 | $ | 26.60 | $ | 27.15 | $ | 23.05 | ||||||||||
Market price at end of year(c) | $ | 36.25 | $ | 30.39 | $ | 26.62 | $ | 27.15 | $ | 23.04 | ||||||||||
Net Asset Value Total Return(d) | 20.85 | % | 16.16 | % | (0.93 | )% | 18.84 | % | 42.59 | % | ||||||||||
Market Price Total Return(d) | 20.73 | % | 16.00 | % | (0.85 | )% | 18.89 | % | 42.62 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 30,867 | $ | 19,768 | $ | 18,623 | $ | 23,081 | $ | 25,353 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.43 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.69 | % | 1.00 | % | 1.01 | % | 1.20 | % | 1.11 | % | ||||||||||
Net investment income, after Waivers | 1.19 | % | 1.58 | % | 1.16 | % | 0.88 | % | 0.92 | % | ||||||||||
Portfolio turnover rate(g) | 50 | % | 38 | % | 83 | % | 47 | % | 76 | % |
(a) | Commencement of Investment Operations. |
(b) | Based on average shares outstanding. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | The net asset value total return from Fund Inception (June 16, 2011, the first day of trading on the Exchange) to April 30, 2012 was 5.17%. The market price total return from Fund Inception to April 30, 2012 was 5.23%. |
(f) | Annualized. |
(g) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 26.06 | $ | 22.65 | $ | 24.13 | $ | 19.11 | $ | 13.87 | ||||||||||
Net investment income (loss)(a) | 0.33 | 0.26 | 0.13 | (0.01 | ) | 0.00 | (b) | |||||||||||||
Net realized and unrealized gain (loss) on investments | 4.01 | 3.38 | (1.53 | ) | 5.09 | 5.25 | ||||||||||||||
Total from investment operations | 4.34 | 3.64 | (1.40 | ) | 5.08 | 5.25 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.38 | ) | (0.23 | ) | (0.08 | ) | — | (0.00 | )(b) | |||||||||||
Return of capital | — | — | — | (0.06 | ) | (0.01 | ) | |||||||||||||
Total distributions | (0.38 | ) | (0.23 | ) | (0.08 | ) | (0.06 | ) | (0.01 | ) | ||||||||||
Net asset value at end of year | $ | 30.02 | $ | 26.06 | $ | 22.65 | $ | 24.13 | $ | 19.11 | ||||||||||
Market price at end of year(c) | $ | 29.99 | $ | 26.04 | $ | 22.63 | $ | 24.13 | $ | 19.10 | ||||||||||
Net Asset Value Total Return(d) | 16.80 | % | 16.23 | % | (5.74 | )% | 26.61 | % | 37.89 | % | ||||||||||
Market Price Total Return(d) | 16.77 | % | 16.25 | % | (5.83 | )% | 26.67 | % | 38.02 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 91,555 | $ | 82,101 | $ | 87,203 | $ | 130,290 | $ | 128,044 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.43 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.45 | % | 0.54 | % | 0.55 | % | 0.69 | % | 0.66 | % | ||||||||||
Net investment income (loss), after Waivers | 1.19 | % | 1.14 | % | 0.61 | % | (0.06 | )% | 0.03 | % | ||||||||||
Portfolio turnover rate(e) | 33 | % | 33 | % | 75 | % | 49 | % | 75 | % |
PowerShares Fundamental Pure Mid Value Portfolio (PXMV)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 20.98 | $ | 17.06 | $ | 17.07 | $ | 15.37 | $ | 11.16 | ||||||||||
Net investment income(a) | 0.37 | 0.37 | 0.25 | 0.15 | 0.23 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 4.87 | 3.94 | (0.03 | ) | 1.70 | 4.24 | ||||||||||||||
Total from investment operations | 5.24 | 4.31 | 0.22 | 1.85 | 4.47 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.34 | ) | (0.39 | ) | (0.23 | ) | (0.15 | ) | (0.26 | ) | ||||||||||
Net asset value at end of year | $ | 25.88 | $ | 20.98 | $ | 17.06 | $ | 17.07 | $ | 15.37 | ||||||||||
Market price at end of year(c) | $ | 25.87 | $ | 20.98 | $ | 17.04 | $ | 17.07 | $ | 15.36 | ||||||||||
Net Asset Value Total Return(d) | 25.19 | % | 25.74 | % | 1.42 | % | 12.16 | % | 40.58 | % | ||||||||||
Market Price Total Return(d) | 25.14 | % | 25.89 | % | 1.30 | % | 12.24 | % | 40.88 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 42,709 | $ | 28,321 | $ | 32,408 | $ | 40,970 | $ | 43,818 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.43 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.62 | % | 0.82 | % | 0.79 | % | 0.91 | % | 0.84 | % | ||||||||||
Net investment income, after Waivers | 1.56 | % | 2.08 | % | 1.57 | % | 0.99 | % | 1.76 | % | ||||||||||
Portfolio turnover rate(e) | 33 | % | 25 | % | 83 | % | 65 | % | 86 | % |
(a) | Based on average shares outstanding. |
(b) | Amount represents less than $0.005. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 89 |
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Financial Highlights (continued)
PowerShares Fundamental Pure Small Core Portfolio (PXSC)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 27.80 | $ | 24.21 | $ | 25.32 | $ | 21.07 | $ | 15.03 | ||||||||||
Net investment income(a) | 0.33 | 0.46 | 0.22 | 0.09 | 0.11 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 5.12 | 3.60 | (1.18 | ) | 4.25 | 6.08 | ||||||||||||||
Total from investment operations | 5.45 | 4.06 | (0.96 | ) | 4.34 | 6.19 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.40 | ) | (0.47 | ) | (0.15 | ) | (0.09 | ) | (0.14 | ) | ||||||||||
Return of capital | — | — | — | — | (0.01 | ) | ||||||||||||||
Total distributions | (0.40 | ) | (0.47 | ) | (0.15 | ) | (0.09 | ) | (0.15 | ) | ||||||||||
Net asset value at end of year | $ | 32.85 | $ | 27.80 | $ | 24.21 | $ | 25.32 | $ | 21.07 | ||||||||||
Market price at end of year(b) | $ | 32.84 | $ | 27.76 | $ | 24.18 | $ | 25.33 | $ | 21.05 | ||||||||||
Net Asset Value Total Return(c) | 19.76 | % | 17.05 | % | (3.70 | )% | 20.64 | % | 41.37 | % | ||||||||||
Market Price Total Return(c) | 19.90 | % | 17.03 | % | (3.85 | )% | 20.80 | % | 41.52 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 14,784 | $ | 15,290 | $ | 15,735 | $ | 18,991 | $ | 18,960 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.43 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.94 | % | 1.22 | % | 1.25 | % | 1.41 | % | 1.26 | % | ||||||||||
Net investment income, after Waivers | 1.06 | % | 1.88 | % | 0.97 | % | 0.42 | % | 0.59 | % | ||||||||||
Portfolio turnover rate(d) | 50 | % | 45 | % | 97 | % | 68 | % | 93 | % |
PowerShares Fundamental Pure Small Growth Portfolio (PXSG)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 19.74 | $ | 17.66 | $ | 19.03 | $ | 14.12 | $ | 10.49 | ||||||||||
Net investment income (loss)(a) | 0.20 | 0.13 | 0.07 | (0.05 | ) | 0.05 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 4.17 | 2.08 | (1.44 | ) | 4.96 | 3.67 | ||||||||||||||
Total from investment operations | 4.37 | 2.21 | (1.37 | ) | 4.91 | 3.72 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.21 | ) | (0.13 | ) | — | — | (0.07 | ) | ||||||||||||
Return of capital | — | — | — | — | (0.02 | ) | ||||||||||||||
Total distributions | (0.21 | ) | (0.13 | ) | — | — | (0.09 | ) | ||||||||||||
Net asset value at end of year | $ | 23.90 | $ | 19.74 | $ | 17.66 | $ | 19.03 | $ | 14.12 | ||||||||||
Market price at end of year(b) | $ | 23.89 | $ | 19.72 | $ | 17.64 | $ | 19.05 | $ | 14.10 | ||||||||||
Net Asset Value Total Return(c) | 22.31 | % | 12.63 | % | (7.20 | )% | 34.77 | % | 35.60 | % | ||||||||||
Market Price Total Return(c) | 22.38 | % | 12.65 | % | (7.40 | )% | 35.11 | % | 35.54 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 29,872 | $ | 26,646 | $ | 30,913 | $ | 109,451 | $ | 32,473 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | %(e) | 0.39 | %(e) | 0.48 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.70 | %(e) | 0.92 | %(e) | 0.69 | % | 0.93 | % | 0.94 | % | ||||||||||
Net investment income (loss), after Waivers | 0.90 | % | 0.72 | % | 0.41 | % | (0.37 | )% | 0.41 | % | ||||||||||
Portfolio turnover rate(d) | 39 | % | 39 | % | 189 | % | 57 | % | 113 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net assets value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning at the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(e) | In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the underlying funds in which the Fund invests. Such indirect expenses are not included in the expense ratio shown. Estimated investment company expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the investment companies and are deducted from the value of the funds that the Fund invests in. The effect of the estimated investment company expenses that the Fund bears indirectly is included in the Fund’s total return. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Fundamental Pure Small Value Portfolio (PXSV)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 19.63 | $ | 16.35 | $ | 17.07 | $ | 14.64 | $ | 10.38 | ||||||||||
Net investment income(a) | 0.30 | 0.32 | 0.19 | 0.16 | 0.09 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 5.03 | 3.31 | (0.72 | ) | 2.45 | 4.25 | ||||||||||||||
Total from investment operations | 5.33 | 3.63 | (0.53 | ) | 2.61 | 4.34 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.29 | ) | (0.35 | ) | (0.19 | ) | (0.18 | ) | (0.08 | ) | ||||||||||
Net asset value at end of year | $ | 24.67 | $ | 19.63 | $ | 16.35 | $ | 17.07 | $ | 14.64 | ||||||||||
Market price at end of year(b) | $ | 24.68 | $ | 19.61 | $ | 16.33 | $ | 17.08 | $ | 14.62 | ||||||||||
Net Asset Value Total Return(c) | 27.29 | % | 22.56 | % | (3.01 | )% | 18.03 | % | 42.03 | % | ||||||||||
Market Price Total Return(c) | 27.47 | % | 22.58 | % | (3.18 | )% | 18.26 | % | 42.11 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 65,376 | $ | 48,084 | $ | 52,312 | $ | 72,540 | $ | 72,453 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.39 | % | 0.39 | % | 0.43 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.54 | % | 0.70 | % | 0.64 | % | 0.80 | % | 0.74 | % | ||||||||||
Net investment income, after Waivers | 1.31 | % | 1.87 | % | 1.28 | % | 1.14 | % | 0.73 | % | ||||||||||
Portfolio turnover rate(d) | 43 | % | 31 | % | 109 | % | 90 | % | 116 | % |
PowerShares Zacks Micro Cap Portfolio (PZI)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 13.57 | $ | 11.34 | $ | 12.53 | $ | 11.69 | $ | 8.10 | ||||||||||
Net investment income(a) | 0.20 | 0.20 | 0.10 | 0.04 | 0.04 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 2.65 | 2.25 | (1.16 | ) | 0.88 | 3.62 | ||||||||||||||
Total from investment operations | 2.85 | 2.45 | (1.06 | ) | 0.92 | 3.66 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.16 | ) | (0.22 | ) | (0.13 | ) | (0.08 | ) | (0.07 | ) | ||||||||||
Net asset value at end of year | $ | 16.26 | $ | 13.57 | $ | 11.34 | $ | 12.53 | $ | 11.69 | ||||||||||
Market price at end of year(b) | $ | 16.25 | $ | 13.54 | $ | 11.32 | $ | 12.52 | $ | 11.68 | ||||||||||
Net Asset Value Total Return(c) | 21.06 | % | 21.95 | % | (8.34 | )% | 7.97 | % | 45.49 | % | ||||||||||
Market Price Total Return(c) | 21.25 | % | 21.90 | % | (8.42 | )% | 7.97 | % | 45.37 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 61,782 | $ | 42,055 | $ | 34,019 | $ | 98,964 | $ | 53,758 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers(e) | 0.70 | % | 0.70 | % | 0.70 | % | 0.70 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers(e) | 0.79 | % | 0.98 | % | 0.92 | % | 0.85 | % | 0.93 | % | ||||||||||
Net investment income, after Waivers | 1.29 | % | 1.72 | % | 0.92 | % | 0.39 | % | 0.38 | % | ||||||||||
Portfolio turnover rate(d) | 123 | % | 96 | % | 67 | % | 61 | % | 78 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(e) | In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the underlying funds in which the Fund invests. Such indirect expenses are not included in the expense ratio shown. Estimated investment company expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the investment companies and are deducted from the value of the funds that the Fund invests in. The effect of the estimated investment company expenses that the Fund bears indirectly is included in the Fund’s total return. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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PowerShares Exchange-Traded Fund Trust
April 30, 2014
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the “Trust”) was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). As of April 30, 2014, the Trust offered fifty-three portfolios. This report includes the following portfolios:
Full Name | Short Name | |
PowerShares Dynamic Large Cap Growth Portfolio (PWB) | “Dynamic Large Cap Growth Portfolio” | |
PowerShares Dynamic Large Cap Value Portfolio (PWV) | “Dynamic Large Cap Value Portfolio” | |
PowerShares Fundamental Pure Large Core Portfolio (PXLC) | “Fundamental Pure Large Core Portfolio” | |
PowerShares Fundamental Pure Large Growth Portfolio (PXLG) | “Fundamental Pure Large Growth Portfolio” | |
PowerShares Fundamental Pure Large Value Portfolio (PXLV) | “Fundamental Pure Large Value Portfolio” | |
PowerShares Fundamental Pure Mid Core Portfolio (PXMC) | “Fundamental Pure Mid Core Portfolio” | |
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) | “Fundamental Pure Mid Growth Portfolio” | |
PowerShares Fundamental Pure Mid Value Portfolio (PXMV) | “Fundamental Pure Mid Value Portfolio” | |
PowerShares Fundamental Pure Small Core Portfolio (PXSC) | “Fundamental Pure Small Core Portfolio” | |
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) | “Fundamental Pure Small Growth Portfolio” | |
PowerShares Fundamental Pure Small Value Portfolio (PXSV) | “Fundamental Pure Small Value Portfolio” | |
PowerShares Zacks Micro Cap Portfolio (PZI) | “Zacks Micro Cap Portfolio” |
Each portfolio (each, a “Fund”, and collectively, the “Funds”) represents a separate series of the Trust. The shares of the Funds are referred to herein as “Shares” or “Fund’s Shares.” Each Fund’s Shares are listed and traded on NYSE Arca, Inc.
The market prices of each Fund’s Shares may differ to some degree from the Fund’s net asset value (“NAV”). Unlike conventional mutual funds, each Fund issues and redeems Shares on a continuous basis, at NAV, only in a large specified number of Shares, each called a “Creation Unit.” Creation Units are issued and redeemed in exchange for the deposit or delivery of a basket of securities (“Deposit Securities”). Except when aggregated in Creation Units by Authorized Participants, the Shares are not individually redeemable securities of the Funds.
The investment objective of each Fund is to seek investment results that generally correspond (before fees and expenses) to the price and yield of its respective index listed below (each, an “Underlying Index”):
Fund | Underlying Index | |
Dynamic Large Cap Growth Portfolio | Dynamic Large Cap Growth IntellidexSM Index | |
Dynamic Large Cap Value Portfolio | Dynamic Large Cap Value IntellidexSM Index | |
Fundamental Pure Large Core Portfolio | RAFI® Fundamental Large Core Index | |
Fundamental Pure Large Growth Portfolio | RAFI® Fundamental Large Growth Index | |
Fundamental Pure Large Value Portfolio | RAFI® Fundamental Large Value Index | |
Fundamental Pure Mid Core Portfolio | RAFI® Fundamental Mid Core Index | |
Fundamental Pure Mid Growth Portfolio | RAFI® Fundamental Mid Growth Index | |
Fundamental Pure Mid Value Portfolio | RAFI® Fundamental Mid Value Index | |
Fundamental Pure Small Core Portfolio | RAFI® Fundamental Small Core Index | |
Fundamental Pure Small Growth Portfolio | RAFI® Fundamental Small Growth Index | |
Fundamental Pure Small Value Portfolio | RAFI® Fundamental Small Value Index | |
Zacks Micro Cap Portfolio | Zacks Micro Cap IndexTM |
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates. In addition, the Funds monitor for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.
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A. Security Valuation
Securities, including restricted securities, are valued according to the following policies.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. When such securities are valued by an independent pricing service they may be considered fair valued. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and ask prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and ask prices. For purposes of determining NAV per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end of day NAV per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Securities with a demand feature exercisable within one to seven days are valued at par. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that Invesco PowerShares Capital Management LLC (the “Adviser”) determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith following procedures approved by the Board of Trustees. Issuer-specific events, market trends, bid/ask quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
Each Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain of each Fund’s investments.
Valuations change in response to many factors, including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
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B. Other Risks
Index Risk. Unlike many investment companies, the Funds do not utilize investing strategies that seek returns in excess of their Underlying Indexes. Therefore, a Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its respective Underlying Index, even if that security generally is underperforming.
Equity Risk. Equity risk is the risk that the value of the securities that each Fund holds will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities a Fund holds participate or factors relating to specific companies in which the Funds invest. For example, an adverse event, such as an unfavorable earnings report, may depress the value of securities a Fund holds; the price of securities may be particularly sensitive to general movements in the stock market; or a drop in the stock market may depress the price of most or all of the securities a Fund holds. In addition, securities of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition.
Industry Concentration Risk. In following its methodology, each Fund’s Underlying Index from time to time may be concentrated to a significant degree in securities of issuers located in a single industry or a sector. To the extent that an Underlying Index concentrates in the securities of issuers in a particular industry or sector, each Fund will also concentrate its investments to approximately the same extent. By concentrating its investments in an industry or sector, a Fund may face more risks than if it were diversified broadly over numerous industries or sectors. In addition, at times, an industry or sector may be out of favor and underperform other industries or the market as a whole. Any factors detrimental to the performance of such industry or sector will disproportionately impact a Fund’s NAV.
Non-Diversified Fund Risk. Fundamental Pure Large Growth Portfolio and Fundamental Pure Large Value Portfolio are non-diversified and can invest a greater portion of its assets in securities of individual issuers than diversified funds. As a result, changes in the market value of a single investment could cause greater fluctuations in Share price than would occur in a diversified fund. This may increase a Fund’s volatility and cause the performance of a relatively small number of issuers to have a greater impact on a Fund’s performance.
Non-Correlation Risk. Each Fund’s return may not match the return of its Underlying Index for a number of reasons. For example, each Fund incurs operating expenses not applicable to its Underlying Index, and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of its Underlying Index. In addition, the performance of each Fund and its Underlying Index may vary due to asset valuation differences and differences between each Fund’s portfolio and its Underlying Index resulting from legal restrictions, cost or liquidity constraints.
Core Risk. For Fundamental Pure Large Core Portfolio, Fundamental Pure Mid Core Portfolio and Fundamental Pure Small Core Portfolio, the returns on “core” securities may or may not move in tandem with the returns on other styles of investing or the overall stock market. Thus, the value of each Fund’s investments will vary and at times may be lower or higher than that of other types of investments.
“Fundamentally Large” Company Risk. For Fundamental Pure Large Core Portfolio, Fundamental Pure Large Growth Portfolio and Fundamental Pure Large Value Portfolio, returns on investments in common stocks of “fundamentally large” U.S. companies could trail the returns on investments in common stocks of smaller companies or other large companies based on market capitalization.
“Fundamentally Mid-Sized” Company Risk. For Fundamental Pure Mid Core Portfolio, Fundamental Pure Mid Growth Portfolio and Fundamental Pure Mid Value Portfolio, investing in common stocks of “fundamentally mid-sized” companies involves greater risk than customarily is associated with investing in larger, more established companies. These companies’ common stocks may be more volatile and less liquid than those of more established companies. These common stocks may have returns that vary, sometimes significantly, from the overall stock market. Often “fundamentally mid-sized” companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.
“Fundamentally Small” Company Risk. For Fundamental Pure Small Core Portfolio, Fundamental Pure Small Growth Portfolio and Fundamental Pure Small Value Portfolio, investing in common stocks of “fundamentally small” companies involves greater risk than customarily in associated with investing in larger, more established companies. These companies’ common stocks may be more volatile and less liquid than those of more established companies. These common stocks may have returns that vary, sometimes significantly, from the overall stock market. Often “fundamentally small” companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.
Growth Risk. For Dynamic Large Cap Growth Portfolio, Fundamental Pure Large Growth Portfolio, Fundamental Pure Mid Growth Portfolio and Fundamental Pure Small Growth Portfolio, the market values of “growth” securities may be more volatile than other types of investments. The returns on “growth” securities may or may not move in tandem with the returns on other styles of investing or the overall stock market. Thus, the value of each Fund’s investments will vary and at times may be lower or higher than that of other types of investments.
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Micro Capitalization Company Risk. Zacks Micro Cap Portfolio’s investments in the securities of micro capitalization companies involve substantially greater risks of loss and price fluctuations. Micro capitalization companies carry additional risks because their earnings and revenues tend to be less predictable (and some companies may be experiencing significant losses), and their share prices tend to be more volatile and their markets less liquid than companies with larger market capitalizations. Also, it may take a long time before the Fund realizes a gain, if any, on an investment in a micro capitalization company.
Value Risk. For Dynamic Large Cap Value Portfolio, Fundamental Pure Large Value Portfolio, Fundamental Pure Mid Value Portfolio and Fundamental Pure Small Value Portfolio, “value” securities are subject to the risk that the valuations never improve or that the returns on “value” securities are less than returns on other styles of investing or the overall stock market. Thus, the value of each Fund’s investments will vary and at times may be lower or higher than that of other types of investments.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and to distribute substantially all of the Fund’s taxable earnings to its shareholders. As such, the Funds will not be subject to federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements.
Each Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed each Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These timing differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and passive foreign investment company adjustments, if any.
The Funds file U.S. federal tax returns and tax returns in certain other jurisdictions. Generally, a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Transactions and Investment Income
Investment transactions are accounted for on a trade date basis. Realized gains and losses from the sale or disposition of securities are computed on the specific identified cost basis. Interest income is recorded on the accrual basis. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. Realized gains, dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date.
E. Expenses
Expenses of the Trust that are directly identifiable to a specific Fund are applied to that Fund. Expenses of the Trust that are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, sub-licensing fees related to its respective Underlying Index, any distribution fees or expenses, litigation expenses, fees payable to the Trust’s Board members who are not “interested persons” (as defined in the 1940 Act) of the Trust (the “Independent Trustees”) or the Adviser, expenses incurred in connection with the Board members’ services, including travel expenses and legal fees of counsel for the Independent Trustees, acquired fund fees and expenses, if any, and extraordinary expenses.
To the extent a Fund invests in other investment companies, the expenses shown in the accompanying financial statements reflect the expenses of the Fund and do not include any expenses of the investment companies in which it invests. The effects of such investment companies’ expenses are included in the realized and unrealized gain or loss on the investments in the investment companies.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and records such dividends on ex-dividend date. Generally, each Fund distributes net realized taxable capital gains, if any, annually in cash and records them on ex-dividend date. Such distributions on a tax basis are determined in conformity with federal income tax regulations, which may differ from GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund’s financial statements as a tax return of capital at fiscal period-end.
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G. Securities Lending
Fundamental Pure Mid Value Portfolio, Fundamental Pure Small Growth Portfolio, Fundamental Pure Small Value Portfolio and Zacks Micro Cap Portfolio may lend portfolio securities having a market value up to one-third of each Fund’s total assets. Such loans are secured by cash collateral equal to no less than 102% of the market value of the loaned securities determined daily by the securities lending provider. Cash collateral received in connection with these loans is invested in an affiliated money market fund and is shown as such on the Schedule of Investments. It is the policy of these Funds to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to a Fund if, and to the extent that, the market value of the securities loaned were to increase, and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. A Fund could experience delays and costs in gaining access to the collateral. A Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Securities lending income on the Statements of Operations. The aggregate value of securities out on loan is shown on the Statements of Assets and Liabilities, if any.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser pursuant to which the Adviser has overall responsibility for the selection and ongoing monitoring of the Funds’ investments, managing the Funds’ business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund (except for the Dynamic Large Cap Growth Portfolio, Dynamic Large Cap Value Portfolio and Zacks Micro Cap Portfolio) has agreed to pay the Adviser an annual fee of 0.29% of the Fund’s average daily net assets. Each of the Dynamic Large Cap Growth Portfolio, Dynamic Large Cap Value Portfolio and Zacks Micro Cap Portfolio has agreed to pay the Adviser an annual fee of 0.50% of the Fund’s average daily net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement (the “Expense Agreement”) with the Trust on behalf of each Fund, pursuant to which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses (excluding interest expenses, brokerage commissions and other trading expenses, offering costs, taxes, acquired fund fees and expenses, if any, and extraordinary expenses) of each Fund (except for Dynamic Large Cap Growth Portfolio, Dynamic Large Cap Value Portfolio and Zacks Micro Cap Portfolio) from exceeding 0.39% of the Fund’s average daily net assets per year (the “Expense Cap”), through at least August 31, 2015. The Expense Cap for each of Dynamic Large Cap Growth Portfolio, Dynamic Large Cap Value Portfolio and Zacks Micro Cap Portfolio is 0.60% of the Fund’s average daily net assets per year, through at least August 31, 2015, and sub-licensing fees are excluded from the expenses subject to the Expense Cap for these Funds in addition to the excluded expenses above. Offering costs excluded from each Expense Cap are: (a) initial legal fees pertaining to the Funds’ Shares offered for sale; (b) initial Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange. Unless the Adviser continues the Expense Agreement, it will terminate on August 31, 2015. The Expense Agreement cannot be terminated during its term. The Adviser did not waive fees and/or pay Fund expenses during the period under this Expense Cap for Dynamic Large Cap Growth Portfolio and Dynamic Large Cap Value Portfolio.
Further, through August 31, 2015, the Adviser has contractually agreed to waive a portion of the Fund’s management fee in an amount equal to 100% of the net advisory fees an affiliate of the Adviser receives that are attributable to certain of the Fund’s investments in money market funds managed by that affiliate (excluding investments of cash collateral from securities lending). The Adviser cannot discontinue this waiver prior to its expiration.
For the fiscal year ended April 30, 2014, the Adviser waived fees and/or paid Fund expenses for each Fund, in the following amounts:
Dynamic Large Cap Growth Portfolio | $ | 179 | ||
Dynamic Large Cap Value Portfolio | 389 | |||
Fundamental Pure Large Core Portfolio | 72,442 | |||
Fundamental Pure Large Growth Portfolio | 55,680 | |||
Fundamental Pure Large Value Portfolio | 81,627 | |||
Fundamental Pure Mid Core Portfolio | 79,806 | |||
Fundamental Pure Mid Growth Portfolio | 52,719 | |||
Fundamental Pure Mid Value Portfolio | 84,727 | |||
Fundamental Pure Small Core Portfolio | 86,835 | |||
Fundamental Pure Small Growth Portfolio | 88,267 | |||
Fundamental Pure Small Value Portfolio | 88,634 | |||
Zacks Micro Cap Portfolio | 50,309 |
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The Expense Agreement provides that the fees waived or expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee was waived or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above.
For the following Funds, the amounts available for potential future recapture by the Adviser under the Expense Agreement and the expiration schedule at April 30, 2014 are as follows:
Total Potential Recapture Amount | Potential Recapture Amounts Expiring | |||||||||||||||
04/30/15 | 04/30/16 | 04/30/17 | ||||||||||||||
Fundamental Pure Large Core Portfolio | $ | 296,835 | $ | 119,199 | $ | 105,264 | $ | 72,372 | ||||||||
Fundamental Pure Large Growth Portfolio | 279,665 | 129,956 | 94,097 | 55,612 | ||||||||||||
Fundamental Pure Large Value Portfolio | 313,919 | 133,196 | 99,141 | 81,582 | ||||||||||||
Fundamental Pure Mid Core Portfolio | 310,954 | 121,623 | 109,592 | 79,739 | ||||||||||||
Fundamental Pure Mid Growth Portfolio | 291,408 | 120,951 | 117,856 | 52,601 | ||||||||||||
Fundamental Pure Mid Value Portfolio | 327,532 | 117,234 | 125,577 | 84,721 | ||||||||||||
Fundamental Pure Small Core Portfolio | 326,644 | 125,378 | 114,500 | 86,766 | ||||||||||||
Fundamental Pure Small Growth Portfolio | 345,842 | 114,756 | 142,898 | 88,188 | ||||||||||||
Fundamental Pure Small Value Portfolio | 354,580 | 120,927 | 145,112 | 88,541 | ||||||||||||
Zacks Micro Cap Portfolio | 238,753 | 102,215 | 86,324 | 50,214 |
The Trust has entered into a Distribution Agreement with Invesco Distributors, Inc. (the “Distributor”), which serves as the distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in the Shares. The Funds are not charged any fees pursuant to the Distribution Agreement. The Distributor is an affiliate of the Adviser.
The Adviser has entered into a licensing agreement for each Fund with the following entities (each, a “Licensor”):
Fund | Licensor | |
Dynamic Large Cap Growth Portfolio | NYSE Arca, Inc. | |
Dynamic Large Cap Value Portfolio | NYSE Arca, Inc. | |
Fundamental Pure Large Core Portfolio | Research Affiliates, LLC | |
Fundamental Pure Large Growth Portfolio | Research Affiliates, LLC | |
Fundamental Pure Large Value Portfolio | Research Affiliates, LLC | |
Fundamental Pure Mid Core Portfolio | Research Affiliates, LLC | |
Fundamental Pure Mid Growth Portfolio | Research Affiliates, LLC | |
Fundamental Pure Mid Value Portfolio | Research Affiliates, LLC | |
Fundamental Pure Small Core Portfolio | Research Affiliates, LLC | |
Fundamental Pure Small Growth Portfolio | Research Affiliates, LLC | |
Fundamental Pure Small Value Portfolio | Research Affiliates, LLC | |
Zacks Micro Cap Portfolio | Zacks Investment Research |
Each Underlying Index name trademark is owned by its respective Licensor. These trademarks have been licensed to the Adviser for use by the Funds. Each Fund is entitled to use its Underlying Index pursuant to the Trust’s sub-licensing agreement with the Adviser. The Funds are required to pay the sub-licensing fees that are shown on the Statements of Operations. The Funds are not sponsored, endorsed, sold or promoted by the Licensors, and the Licensors make no representation regarding the advisability of investing in any of the Funds.
The Trust has entered into service agreements whereby The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian, fund accountant and transfer agent for each Fund.
Note 4. Investments in Affiliates
Each Fund’s Adviser and Invesco Mortgage Capital, Inc. REIT are wholly-owned subsidiaries of Invesco Ltd., and therefore Invesco Ltd. and Invesco Mortgage Capital, Inc. REIT are considered to be affiliated. The table below shows each Fund’s transactions in, and earnings from, its investments in Invesco Ltd. and Invesco Mortgage Capital, Inc. REIT for the fiscal year ended April 30, 2014.
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Fundamental Pure Mid Core Portfolio
Value April 30, 2013 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain | Value April 30, 2014 | Dividend Income | ||||||||||||||||||||||
Invesco Ltd. | $ | 250,556 | $ | 239,318 | $ | (172,414 | ) | $ | 30,953 | $ | 5,166 | $ | 353,579 | $ | 8,729 |
Fundamental Pure Mid Growth Portfolio
Value April 30, 2013 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation (Depreciation) | Realized Gain | Value April 30, 2014 | Dividend Income | ||||||||||||||||||||||
Invesco Mortgage Capital, Inc. REIT | $ | — | $ | 434,097 | $ | — | $ | (17,013 | ) | $ | — | $ | 417,084 | $ | 12,510 |
Fundamental Pure Small Growth Portfolio
Value April 30, 2013 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation (Depreciation) | Realized Gain | Value April 30, 2014 | Dividend Income | ||||||||||||||||||||||
Invesco Mortgage Capital, Inc. REIT | $ | 216,525 | $ | 53,805 | $ | (232,886 | ) | $ | (16,373 | ) | $ | (21,071 | ) | $ | — | $ | 15,558 |
Note 5. Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
Except for the Funds listed below, as of April 30, 2014, all of the securities in each Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Investments in Securities | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Fundamental Pure Small Growth Portfolio | ||||||||||||||||
Equity Securities | $ | 31,107,445 | $ | 0 | $ | — | $ | 31,107,445 | ||||||||
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Fundamental Pure Small Value Portfolio | ||||||||||||||||
Equity Securities | $ | 67,318,200 | $ | — | $ | 66,629 | $ | 67,384,829 | ||||||||
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Note 6. Distributions to Shareholders and Tax Components of Net Assets
Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended April 30, 2014 and 2013:
2014 | 2013 | |||||||||||||||
Ordinary Income | Long Term Capital Gains | Ordinary Income | Long Term Capital Gains | |||||||||||||
Dynamic Large Cap Growth Portfolio | $ | 1,108,791 | $ | — | $ | 1,990,554 | $ | — | ||||||||
Dynamic Large Cap Value Portfolio | 13,897,107 | — | 10,900,743 | — |
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2014 | 2013 | |||||||||||||||
Ordinary Income | Long Term Capital Gains | Ordinary Income | Long Term Capital Gains | |||||||||||||
Fundamental Pure Large Core Portfolio | $ | 612,506 | $ | — | $ | 662,935 | $ | — | ||||||||
Fundamental Pure Large Growth Portfolio | 2,133,201 | 65,835 | 166,518 | — | ||||||||||||
Fundamental Pure Large Value Portfolio | 263,618 | 7,335 | 147,580 | — | ||||||||||||
Fundamental Pure Mid Core Portfolio | 309,864 | — | 280,344 | — | ||||||||||||
Fundamental Pure Mid Growth Portfolio | 1,178,058 | — | 765,069 | — | ||||||||||||
Fundamental Pure Mid Value Portfolio | 549,786 | — | 648,717 | — | ||||||||||||
Fundamental Pure Small Core Portfolio | 198,389 | — | 259,833 | — | ||||||||||||
Fundamental Pure Small Growth Portfolio | 268,388 | — | 218,960 | — | ||||||||||||
Fundamental Pure Small Value Portfolio | 729,968 | — | 957,949 | — | ||||||||||||
Zacks Micro Cap Portfolio | 512,267 | — | 557,741 | — |
Tax Components of Net Assets at Fiscal Year-End:
Undistributed Ordinary Income | Un distributed Long-term Capital Gains | Temporary Book/Tax Differences | Net Unrealized Appreciation— Investment Securities | Net Unrealized Appreciation— Other Investments | Capital Loss Carryforward | Post-October Capital Losses Deferrals* | Shares of Beneficial Interest | Total Net Assets | ||||||||||||||||||||||||||||
Dynamic Large Cap Growth Portfolio | $ | 221,950 | $ | — | $ | (24,459 | ) | $ | 22,988,018 | $ | — | $ | (256,926,405 | ) | $ | — | $ | 519,415,454 | $ | 285,674,558 | ||||||||||||||||
Dynamic Large Cap Value Portfolio | 1,617,941 | — | (28,370 | ) | 107,875,215 | — | (138,249,419 | ) | (5,741,463 | ) | 835,613,999 | 801,087,903 | ||||||||||||||||||||||||
Fundamental Pure Large Core Portfolio | 41,456 | — | (10,508 | ) | 5,678,246 | — | (10,721,628 | ) | (19,712 | ) | 45,802,542 | 40,770,396 | ||||||||||||||||||||||||
Fundamental Pure Large Growth Portfolio | 208,205 | 2,703 | (5,907 | ) | 16,339,462 | — | — | (997,854 | ) | 90,775,115 | 106,321,724 | |||||||||||||||||||||||||
Fundamental Pure Large Value Portfolio | 52,148 | 540 | (5,136 | ) | 1,728,454 | — | — | (16,361 | ) | 12,941,075 | 14,700,720 | |||||||||||||||||||||||||
Fundamental Pure Mid Core Portfolio | 49,926 | — | (10,037 | ) | 3,769,580 | — | (10,292,450 | ) | (496,482 | ) | 37,846,610 | 30,867,147 | ||||||||||||||||||||||||
Fundamental Pure Mid Growth Portfolio | 214,879 | — | (17,205 | ) | 14,295,778 | — | (170,505,319 | ) | (1,759,292 | ) | 249,326,298 | 91,555,139 | ||||||||||||||||||||||||
Fundamental Pure Mid Value Portfolio | 70,870 | — | (11,339 | ) | 7,015,281 | 13,680 | (44,874,387 | ) | (8,062 | ) | 80,502,922 | 42,708,965 | ||||||||||||||||||||||||
Fundamental Pure Small Core Portfolio | 31,530 | — | (9,733 | ) | 1,156,523 | — | (9,777,766 | ) | (309,067 | ) | 23,692,159 | 14,783,646 | ||||||||||||||||||||||||
Fundamental Pure Small Growth Portfolio | 184,436 | — | (10,916 | ) | 3,588,992 | — | (49,677,163 | ) | (856,871 | ) | 76,643,733 | 29,872,211 | ||||||||||||||||||||||||
Fundamental Pure Small Value Portfolio | 107,706 | — | (12,370 | ) | 6,592,429 | 9 | (44,646,562 | ) | — | 103,334,569 | 65,375,781 | |||||||||||||||||||||||||
Zacks Micro Cap Portfolio | 391,319 | — | (12,179 | ) | 1,336,840 | — | (91,054,891 | ) | (282,761 | ) | 151,403,203 | 61,781,531 |
* | The Funds will elect to defer net capital losses incurred after October 31 (“Post-October Capital Losses”) within the taxable year that are deemed to arise on the first business day of each Fund’s next taxable year. |
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Funds to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in 8 tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
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The following Funds have capital loss carryforwards as of April 30, 2014, which expire as follows:
Post-effective no expiration Short-Term | Post-effective no expiration Long-Term | |||||||||||||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Total* | Utilized | Expiring | |||||||||||||||||||||||||||||||||
Dynamic Large Cap Growth Portfolio | $ | 10,916,066 | $ | 14,024,455 | $ | 68,715,641 | $ | 131,638,879 | $ | 15,986,258 | $ | 15,645,106 | $ | — | $ | 256,926,405 | $ | 2,545,279 | $ | 191,864 | ||||||||||||||||||||
Dynamic Large Cap Value Portfolio | 1,378,743 | 2,783,761 | 22,558,581 | 56,819,182 | 17,964,198 | 29,535,406 | 7,209,548 | 138,249,419 | — | 70,814 | ||||||||||||||||||||||||||||||
Fundamental Pure Large Core Portfolio | — | 87,112 | 2,328,337 | 5,621,834 | 1,626,267 | 1,058,078 | — | 10,721,628 | 37,665 | — | ||||||||||||||||||||||||||||||
Fundamental Pure Large Growth Portfolio | — | — | — | — | — | — | — | �� | — | — | — | |||||||||||||||||||||||||||||
Fundamental Pure Large Value Portfolio | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||
Fundamental Pure Mid Core Portfolio | — | 628,828 | 3,815,763 | 3,611,366 | 741,893 | 1,482,320 | 12,280 | 10,292,450 | 147,225 | — | ||||||||||||||||||||||||||||||
Fundamental Pure Mid Growth Portfolio | 8,055,857 | 5,112,579 | 54,769,394 | 82,364,246 | 12,021,724 | 7,286,499 | 895,020 | 170,505,319 | — | 422,220 | ||||||||||||||||||||||||||||||
Fundamental Pure Mid Value Portfolio | 2,384,765 | 5,347,255 | 12,697,113 | 18,996,863 | 2,751,107 | 2,681,305 | 15,979 | 44,874,387 | 158,728 | 237,806 | ||||||||||||||||||||||||||||||
Fundamental Pure Small Core Portfolio | — | 1,028,299 | 2,738,120 | 2,009,294 | 2,491,519 | 1,324,219 | 186,315 | 9,777,766 | — | — | ||||||||||||||||||||||||||||||
Fundamental Pure Small Growth Portfolio | 13,094,039 | 6,666,558 | 9,888,431 | 10,392,627 | 4,547,805 | 4,797,048 | 290,655 | 49,677,163 | — | 823,782 | ||||||||||||||||||||||||||||||
Fundamental Pure Small Value Portfolio | 3,929,009 | 8,615,687 | 16,547,947 | 9,588,502 | 5,376,983 | 588,434 | — | 44,646,562 | 581,242 | 703,862 | ||||||||||||||||||||||||||||||
Zacks Micro Cap Portfolio | 15,172,527 | 14,330,930 | 28,782,755 | 12,380,833 | 7,234,973 | 12,284,744 | 868,129 | 91,054,891 | — | 1,951,245 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
Note 7. Investment Transactions
For the fiscal year ended April 30, 2014, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, U.S. Treasury obligations, money market funds and in-kind transactions, were as follows:
Purchases | Sales | |||||||
Dynamic Large Cap Growth Portfolio | $ | 306,485,576 | $ | 307,269,850 | ||||
Dynamic Large Cap Value Portfolio | 720,093,974 | 718,031,833 | ||||||
Fundamental Pure Large Core Portfolio | 14,739,508 | 12,839,607 | ||||||
Fundamental Pure Large Growth Portfolio | 20,402,732 | 21,025,086 | ||||||
Fundamental Pure Large Value Portfolio | 2,854,134 | 3,040,767 | ||||||
Fundamental Pure Mid Core Portfolio | 13,741,118 | 13,156,164 | ||||||
Fundamental Pure Mid Growth Portfolio | 28,272,644 | 28,984,847 | ||||||
Fundamental Pure Mid Value Portfolio | 12,218,072 | 11,883,181 | ||||||
Fundamental Pure Small Core Portfolio | 8,448,792 | 8,029,099 | ||||||
Fundamental Pure Small Growth Portfolio | 11,264,268 | 10,972,584 | ||||||
Fundamental Pure Small Value Portfolio | 24,594,096 | 25,416,086 | ||||||
Zacks Micro Cap Portfolio | 67,114,206 | 66,870,250 |
For the fiscal year ended April 30, 2014, in-kind transactions associated with creations and redemptions were as follows:
Cost of Securities Received | Value of Securities Delivered | |||||||
Dynamic Large Cap Growth Portfolio | $ | 323,304,633 | $ | 293,338,575 | ||||
Dynamic Large Cap Value Portfolio | 865,509,592 | 749,503,713 | ||||||
Fundamental Pure Large Core Portfolio | 19,483,247 | 14,420,912 | ||||||
Fundamental Pure Large Growth Portfolio | 30,810,725 | 22,690,742 | ||||||
Fundamental Pure Large Value Portfolio | 8,176,579 | 2,641,720 | ||||||
Fundamental Pure Mid Core Portfolio | 17,247,023 | 11,382,779 | ||||||
Fundamental Pure Mid Growth Portfolio | 24,091,863 | 26,186,967 |
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Securities Received | Securities Delivered | |||||||
Fundamental Pure Mid Value Portfolio | $ | 18,141,471 | $ | 11,655,629 | ||||
Fundamental Pure Small Core Portfolio | 9,726,978 | 13,220,893 | ||||||
Fundamental Pure Small Growth Portfolio | 8,643,839 | 10,921,962 | ||||||
Fundamental Pure Small Value Portfolio | 28,796,270 | 23,092,246 | ||||||
Zacks Micro Cap Portfolio | 48,453,520 | 37,285,062 |
Gains (losses) on in-kind transactions are generally not considered taxable gains (losses) for federal income tax purposes.
At April 30, 2014, the aggregate cost and the net unrealized appreciation of investments for tax purposes were as follows:
Cost | Net Unrealized Appreciation | Gross Unrealized Appreciation | Gross Unrealized (Depreciation) | |||||||||||||
Dynamic Large Cap Growth Portfolio | $ | 262,751,963 | $ | 22,988,018 | $ | 28,805,408 | $ | (5,817,390 | ) | |||||||
Dynamic Large Cap Value Portfolio | 693,155,457 | 107,875,215 | 111,728,814 | (3,853,599 | ) | |||||||||||
Fundamental Pure Large Core Portfolio | 35,113,732 | 5,678,246 | 5,871,580 | (193,334 | ) | |||||||||||
Fundamental Pure Large Growth Portfolio | 90,019,567 | 16,339,462 | 16,524,268 | (184,806 | ) | |||||||||||
Fundamental Pure Large Value Portfolio | 12,984,484 | 1,728,454 | 1,779,068 | (50,614 | ) | |||||||||||
Fundamental Pure Mid Core Portfolio | 27,147,322 | 3,769,580 | 4,084,272 | (314,692 | ) | |||||||||||
Fundamental Pure Mid Growth Portfolio | 77,331,276 | 14,295,778 | 16,554,426 | (2,258,648 | ) | |||||||||||
Fundamental Pure Mid Value Portfolio | 37,479,328 | 7,015,281 | 7,866,382 | (851,101 | ) | |||||||||||
Fundamental Pure Small Core Portfolio | 13,667,672 | 1,156,523 | 1,581,295 | (424,772 | ) | |||||||||||
Fundamental Pure Small Growth Portfolio | 27,518,453 | 3,588,992 | 4,754,379 | (1,165,387 | ) | |||||||||||
Fundamental Pure Small Value Portfolio | 60,792,400 | 6,592,429 | 8,981,811 | (2,389,382 | ) | |||||||||||
Zacks Micro Cap Portfolio | 63,795,966 | 1,336,840 | 5,884,945 | (4,548,105 | ) |
Note 8. Reclassification of Permanent Differences
Primarily as a result of differing book/tax treatment of in-kind transactions on April 30, 2014, amounts were reclassified between undistributed net investment income, undistributed net realized gain (loss) and shares of beneficial interest. These reclassifications had no effect on the net assets of each Fund. For the fiscal year ended April 30, 2014, the reclassifications were as follows:
Undistributed Net Investment Income | Undistributed Net Realized Gain (Loss) | Shares of Beneficial Interest | ||||||||||
Dynamic Large Cap Growth Portfolio | $ | — | $ | (57,448,034 | ) | $ | 57,448,034 | |||||
Dynamic Large Cap Value Portfolio | — | (104,348,465 | ) | 104,348,465 | ||||||||
Fundamental Pure Large Core Portfolio | — | (3,296,436 | ) | 3,296,436 | ||||||||
Fundamental Pure Large Growth Portfolio | 367,391 | (4,156,164 | ) | 3,788,773 | ||||||||
Fundamental Pure Large Value Portfolio | 13,019 | (792,384 | ) | 779,365 | ||||||||
Fundamental Pure Mid Core Portfolio | — | (2,811,857 | ) | 2,811,857 | ||||||||
Fundamental Pure Mid Growth Portfolio | — | (7,367,277 | ) | 7,367,277 | ||||||||
Fundamental Pure Mid Value Portfolio | — | (3,783,215 | ) | 3,783,215 | ||||||||
Fundamental Pure Small Core Portfolio | — | (2,975,631 | ) | 2,975,631 | ||||||||
Fundamental Pure Small Growth Portfolio | (315 | ) | (2,685,721 | ) | 2,686,036 | |||||||
Fundamental Pure Small Value Portfolio | (5,200 | ) | (7,512,657 | ) | 7,517,857 | |||||||
Zacks Micro Cap Portfolio | 47,769 | (8,528,892 | ) | 8,481,123 |
Note 9. Trustees’ and Officer’s Fees
Trustees’ and Officer’s Fees include amounts accrued by the Funds to pay remuneration to the Independent Trustees and Officer of the Funds. The Trustee who is an “interested person” (the “Non-Independent Trustee”) of the Trust does not receive any Trustees’ fees.
The Trust has adopted a deferred compensation plan (the “Plan”). Under the Plan, an Independent Trustee who has executed a Deferred Fee Agreement (a “Participating Trustee”) may defer receipt of all or a portion of his compensation (“Deferral Fees”). Such Deferral Fees are deemed to be invested in select PowerShares Funds. The Deferral Fees payable to the Participating Trustee are valued as of the date such Deferral Fees would have been paid to the Participating Trustee. The value increases with contributions or
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with increases in the value of the Shares selected, and the value decreases with distributions or with declines in the value of the Shares selected. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Funds.
Note 10. Capital
Shares are created and redeemed by each Fund only in Creation Units of 50,000 Shares. Only Authorized Participants are permitted to purchase or redeem Creation Units from the Funds. Such transactions are generally permitted in exchange for Deposit Securities, with a balancing cash component to equate the transaction to the NAV per Share of a Fund of the Trust on the transaction date. However, for all Funds, cash in an amount equivalent to the value of certain securities may be substituted, generally when the securities are not available in sufficient quantity for delivery, not eligible for trading by the Authorized Participant or as a result of other market circumstances.
To the extent that the Funds permit transactions in exchange for Deposit Securities, each Fund may issue Shares in advance of receipt of Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to 105% of the market value of the missing Deposit Securities. In accordance with each Fund’s Participant Agreement, Creation Units will be issued to an Authorized Participant, notwithstanding the fact that the corresponding Deposit Securities have not been received in part or in whole, in reliance on the undertaking of the Authorized Participant to deliver the missing Deposit Securities as soon as possible, which undertaking shall be secured by the Authorized Participant’s delivery and maintenance of collateral consisting of cash in the form of U.S. dollars in immediately available funds having a value (marked-to-market daily) at least equal to 105%, which the Adviser may change from time to time, of the value of the missing Deposit Securities.
Transactions in each Fund’s Shares are disclosed in detail in the Statements of Changes in Net Assets.
Note 11. Indemnifications
Under the Trust’s organizational documents, its officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Each Independent Trustee is also indemnified against certain liabilities arising out of the performance of his duties to the Trust pursuant to an Indemnification Agreement between the Independent Trustee and the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
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Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of PowerShares Dynamic Large Cap Growth Portfolio, PowerShares Dynamic Large Cap Value Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares Zacks Micro Cap Portfolio (each an individual portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the “Funds”) at April 30, 2014, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2014 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Chicago, IL
June 24, 2014
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As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur advisory fees and other Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2014.
In addition to the fees and expenses which the PowerShares Zacks Micro Cap Portfolio and PowerShares Fundamental Pure Small Growth Portfolios (collectively, the “Portfolios”) bear directly, the Portfolios indirectly bear a pro rata share of the fees and expenses of the investment companies in which the Portfolios invest. The amount of fees and expenses incurred indirectly by the Portfolios will vary because the investment companies have varied expenses and fee levels and the Portfolios may own different proportions of the investment companies at different times. Estimated investment companies’ expenses are not expenses that are incurred directly by the Portfolio. They are expenses that are incurred directly by the investment companies and are deducted from the value of the investment companies the Portfolios invest in. The effect of the estimated investment companies’ expenses that you bear indirectly are included in each Portfolio’s total returns.
Actual Expenses
The first line in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following table provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as sales charges and brokerage commissions. Therefore, the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by the Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares Dynamic Large Cap Growth Portfolio (PWB) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,048.63 | 0.57 | % | $ | 2.90 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.97 | 0.57 | 2.86 | ||||||||||||
PowerShares Dynamic Large Cap Value Portfolio (PWV) | ||||||||||||||||
Actual | 1,000.00 | 1,107.86 | 0.57 | 2.98 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.97 | 0.57 | 2.86 | ||||||||||||
PowerShares Fundamental Pure Large Core Portfolio (PXLC) | ||||||||||||||||
Actual | 1,000.00 | 1,085.78 | 0.39 | 2.02 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Fundamental Pure Large Growth Portfolio (PXLG) | ||||||||||||||||
Actual | 1,000.00 | 1,096.71 | 0.39 | 2.03 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Fundamental Pure Large Value Portfolio (PXLV) | ||||||||||||||||
Actual | 1,000.00 | 1,092.92 | 0.39 | 2.02 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 |
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Fees and Expenses (continued)
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares Fundamental Pure Mid Core Portfolio (PXMC) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,075.39 | 0.39 | % | $ | 2.01 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Fundamental Pure Mid Growth Portfolio (PXMG) | ||||||||||||||||
Actual | 1,000.00 | 1,069.52 | 0.39 | 2.00 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Fundamental Pure Mid Value Portfolio (PXMV) | ||||||||||||||||
Actual | 1,000.00 | 1,105.44 | 0.39 | 2.04 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Fundamental Pure Small Core Portfolio (PXSC) | ||||||||||||||||
Actual | 1,000.00 | 1,049.26 | 0.39 | 1.98 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Fundamental Pure Small Growth Portfolio (PXSG) | ||||||||||||||||
Actual | 1,000.00 | 1,058.46 | 0.39 | 1.99 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Fundamental Pure Small Value Portfolio (PXSV) | ||||||||||||||||
Actual | 1,000.00 | 1,065.05 | 0.39 | 2.00 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.86 | 0.39 | 1.96 | ||||||||||||
PowerShares Zacks Micro Cap Portfolio (PZI) | ||||||||||||||||
Actual | 1,000.00 | 1,040.09 | 0.70 | 3.54 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.32 | 0.70 | 3.51 |
(1) | Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six-month period ended April 30, 2014. Expenses are calculated by multiplying the Fund’s annualized expense ratio by the average account value for the period, then multiplying the result by 181/365. Expense ratios for the most recent six-month period may differ from expense ratios based on the annualized data in the Financial Highlights. |
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Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.
The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state’s requirement.
Each Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended April 30, 2014:
Federal Income Tax Information
Qualified Dividend Income* | Dividends-Received Deduction* | Long Term Capital Gains | |||||||||||||
Dynamic Large Cap Growth Portfolio | 100 | % | 100 | % | $ | — | |||||||||
Dynamic Large Cap Value Portfolio | 100 | % | 100 | % | — | ||||||||||
Fundamental Pure Large Core Portfolio | 100 | % | 100 | % | — | ||||||||||
Fundamental Pure Large Growth Portfolio | 100 | % | 98 | % | 65,835 | ||||||||||
Fundamental Pure Large Value Portfolio | 100 | % | 100 | % | 7,335 | ||||||||||
Fundamental Pure Mid Core Portfolio | 100 | % | 100 | % | — | ||||||||||
Fundamental Pure Mid Growth Portfolio | 100 | % | 95 | % | — | ||||||||||
Fundamental Pure Mid Value Portfolio | 100 | % | 100 | % | — | ||||||||||
Fundamental Pure Small Core Portfolio | 100 | % | 98 | % | — | ||||||||||
Fundamental Pure Small Growth Portfolio | 100 | % | 100 | % | — | ||||||||||
Fundamental Pure Small Value Portfolio | 100 | % | 97 | % | — | ||||||||||
Zacks Micro Cap Portfolio | 100 | % | 98 | % | — |
* | The above percentages are based on ordinary income dividends paid to shareholders during the Fund’s fiscal year. |
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The Independent Trustees, the Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by each Trustee are shown below.
The Trustees and officers information is current as of April 30, 2014.
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Ronn R. Bagge (1958) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Founder and Principal, YQA Capital Management LLC (1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider). | 114 | None | |||||
Todd J. Barre (1957) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2010 | Assistant Professor of Business, Trinity Christian College (2010-Present); formerly Vice President and Senior Investment Strategist (2001-2008), Director of Open Architecture and Trading (2007-2008), Head of Fundamental Research (2004-2007) and Vice President and Senior Fixed Income Strategist (1994-2001), BMO Financial Group/Harris Private Bank. | 114 | None | |||||
Marc M. Kole (1960) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2006 | Chief Financial Officer, Hope Network (social services) (2008-2012); formerly, Assistant Vice President and Controller, Priority Health (health insurance) (2005-2008); Senior Vice President of Finance, United Healthcare (2004-2005); Senior Vice President of Finance, Oxford Health Plans (2000-2004). | 114 | None | |||||
Yung Bong Lim (1964) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Managing Partner, Residential Dynamics Group LLC (2008-Present); formerly, Managing Director, Citadel Investment Group, L.L.C. (1999-2007). | 114 | None | |||||
Philip M. Nussbaum (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (2004-Present). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Gary R. Wicker (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Senior Vice President of Global Finance and Chief Financial Officer at RBC Ministries (publishing company) (2013-Present); formerly, Executive Vice President and Chief Financial Officer, Zondervan Publishing (a division of Harper Collins/NewsCorp) (2007-2012); Senior Vice President and Group Controller (2005-2006), Senior Vice President and Chief Financial Officer (2003-2004), Chief Financial Officer (2001-2003), Vice President, Finance and Controller (1999-2001) and Assistant Controller (1997-1999), divisions of The Thomson Corporation (information services provider). | 114 | None | |||||
Donald H. Wilson (1959) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Chairman of the Board and Trustee | Chairman since 2012; Trustee since 2006 | Chairman, President and Chief Executive Officer, Community Financial Shares, Inc. and Community Bank—Wheaton/Glen Ellyn (subsidiary) (2013–Present); Chairman and Chief Executive Officer, Stone Pillar Advisers, Ltd. (2010-Present); formerly, Chief Operating Officer, AMCORE Financial, Inc. (bank holding company) (2007-2009); Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (2006-2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (1995-2006). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
The Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by the Non-Independent Trustee and the other directorships, if any, held by the Non-Independent Trustee are shown below.
Name, Address and Age of Non-Independent Trustee | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Non-Independent Trustee | Other Directorships Held by Non-Independent Trustee During the Past 5 Years | |||||
Kevin M. Carome (1956) Invesco Ltd. Two Peachtree Pointe 1555 Peachtree St., N.E., Suite 1800 Atlanta, GA 30309 | Trustee | Since 2010 | Senior Managing Director, Secretary and General Counsel, Invesco Ltd. (2006-Present); Director, Invesco Advisers, Inc. (2009-Present); Director, Invesco Advisers, Inc., Invesco Finance PLC, INVESCO Funds Group, Inc., and Invesco Holding Company Limited; Director and Executive Vice President, Invesco Finance, Inc., Invesco Group Services, Inc., Invesco Investments (Bermuda) Ltd., Invesco North American Holdings, Inc., and IVZ, Inc.; Director and Secretary, IVZ Bahamas Private Limited; formerly, Senior Vice President, Secretary and General Counsel, Invesco Advisers, Inc. (2003-2005); Senior Vice President and General Counsel, Liberty Financial Companies, Inc. (2000-2001); General Counsel of certain investment management subsidiaries of Liberty Financial Companies, Inc. (1998-2000); Associate General Counsel, Liberty Financial Companies, Inc. (1993-1998); Associate, Ropes & Gray LLP. | 114 | None |
* | This is the date the Non-Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Andrew Schlossberg (1974) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046 | President | Since 2009 | Director, Invesco Distributors, Inc. (2012-Present); Managing Director—U.S. Strategy and Marketing, Invesco PowerShares Capital Management LLC (2010-Present); Managing Director, U.S. head of business strategy and chief marketing officer for Invesco Ltd. in the United States (2008-Present); Director, Invesco Distributors, Inc. (2012-Present); and Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present); formerly, Mr. Schlossberg served in multiple roles within Invesco, including head of corporate development, as well as global leadership roles in strategy and product development in the company’s North American Institutional and Retirement divisions (2002-2007). | |||
Peter Hubbard (1981) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2009 | Vice President and Director of Portfolio Management—Invesco PowerShares Capital Management LLC (2008-Present); formerly, Portfolio Manager, Invesco PowerShares Capital Management LLC (2007-2008); Research Analyst, Invesco PowerShares Capital Management LLC (2005-2007); Research Analyst and Trader, Ritchie Capital, a hedge fund operator (2003-2005). | |||
David Warren (1957) Invesco Canada Ltd. 5140 Yonge Street Suite 900, Toronto, Ontario M2N 6X7 | Vice President | Since 2009 | Managing Director—Chief Administrative Officer, Americas, Invesco PowerShares Capital Management LLC; Senior Vice President, Invesco Advisers, Inc. (2009–Present); Director, Executive Vice President and Chief Financial Officer, Invesco Inc. (2009–Present); Senior Vice President, Invesco Management Group, Inc. (2007–Present); Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) and Chief Administrative Officer, North American Retail, Invesco Ltd. (2007-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Invesco Canada Holdings Inc. (2002–Present), Invesco Corporate Class Inc., and Invesco Canada Fund Inc.; Director, Executive Vice President and Chief Financial Officer, Invesco, Inc.; formerly, Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) (2000-2006). | |||
Sheri Morris (1964) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Vice President | Since 2012 | Vice President, Treasurer and Principal Financial Officer, The Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present) and Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; formerly, Treasurer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc. | |||
Rudolf E. Reitmann (1971) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global Exchange Traded Funds Operations, Invesco PowerShares Capital Management LLC (since 2013). |
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Daniel E. Draper (1968) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Senior Vice President, Invesco Distributors, Inc. (since 2014); Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Managing Director, Invesco PowerShares Global ETFs (since 2013); formerly, Managing Director, Credit Suisse Asset Management (2010-2013) and Lyxor Asset Management/Societe Generale (2007-2010). | |||
Steven M. Hill (1964) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President and Treasurer | Since 2013 | Vice President and Treasurer of PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global ETF Administration, Invesco PowerShares Capital Management LLC (since 2011); formerly, Senior Managing Director and Chief Financial Officer, Destra Capital Management LLC and its subsidiaries (2010-2011); Chief Financial Officer, Destra Investment Trust and Destra Investment Trust II (2010-2011); Senior Managing Director, Claymore Securities, Inc. (2003-2010); and Chief Financial Officer, Claymore sponsored mutual funds (2003-2010). | |||
Christopher Joe (1969) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Chief Compliance Officer | Since 2012 | U.S. Compliance Director, Invesco, Ltd. (since 2006); formerly, Chief Compliance Officer, Invesco Investment Advisers, LLC (registered investment adviser) (2010-2013); formerly, Assistant Fund Accounting Manager, Invesco, Ltd. (1998-1999). | |||
Anna Paglia (1974) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Secretary | Since 2011 | Secretary, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (2011-Present); Head of Legal, Invesco PowerShares Capital Management LLC (2010-Present); formerly, Partner, K&L Gates LLP (formerly, Bell Boyd & Lloyd LLP) (2007-2010); Associate Counsel at Barclays Global Investors Ltd. (2004-2006). |
Availability of Additional Information About the Trustees
The Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request at (800) 983-0903.
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for the following 51 series (each, a “Fund” and collectively, the “Funds”):
PowerShares Aerospace & Defense Portfolio
PowerShares BuyBack Achievers™ Portfolio
PowerShares Cleantech™ Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares DWA Momentum Portfolio
PowerShares DWA Basic Materials Momentum Portfolio
PowerShares DWA Consumer Cyclicals Momentum Portfolio
PowerShares DWA Consumer Staples Momentum Portfolio
PowerShares DWA Energy Momentum Portfolio
PowerShares DWA Financial Momentum Portfolio
PowerShares DWA Healthcare Momentum Portfolio
PowerShares DWA Industrials Momentum Portfolio
PowerShares DWA NASDAQ Momentum Portfolio
PowerShares DWA Technology Momentum Portfolio
PowerShares DWA Utilities Momentum Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Building & Construction Portfolio
PowerShares Dynamic Energy Exploration & Production Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Market Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Oil & Gas Services Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Financial Preferred Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares Fundamental Pure Large Core Portfolio
PowerShares Fundamental Pure Large Growth Portfolio
PowerShares Fundamental Pure Large Value Portfolio
PowerShares Fundamental Pure Mid Core Portfolio
PowerShares Fundamental Pure Mid Growth Portfolio
PowerShares Fundamental Pure Mid Value Portfolio
PowerShares Fundamental Pure Small Core Portfolio
PowerShares Fundamental Pure Small Growth Portfolio
PowerShares Fundamental Pure Small Value Portfolio
PowerShares Global Listed Private Equity Portfolio
PowerShares Golden Dragon China Portfolio
PowerShares High Yield Equity Dividend Achievers TM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares S&P 500® High Quality Portfolio
PowerShares Water Resources Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares WilderHill Progressive Energy Portfolio
PowerShares Zacks Micro Cap Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year, ten-year and since-inception periods ended December 31, 2013, as applicable, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
explanations for any tracking error. The Trustees noted that for each applicable period the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s advisory fee and net expense ratio, as compared to information compiled by the Adviser from Lipper Inc. databases on the advisory fees and net expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual advisory fee charged to each Fund is:
— | 0.50% of the Fund’s average daily net assets for each Fund other than PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend AchieversTM Portfolio, PowerShares International Dividend AchieversTM Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio; |
— | 0.40% of the Fund’s average daily net assets for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; and |
— | 0.29% of the Fund’s average daily net assets for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio. |
The Trustees also noted that the Adviser has agreed to waive a portion of its advisory fee and/or pay expenses (an “Expense Cap”) to the extent necessary to prevent the annual operating expenses of each Fund from exceeding the percentage of that Fund’s average daily net assets, at least until August 31, 2015, as set forth below:
— | 0.60%, excluding interest expenses, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares DWA NASDAQ Momentum Portfolio and PowerShares Dynamic Market Portfolio; |
— | 0.50%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; |
— | 0.39%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio and PowerShares Fundamental Pure Small Value Portfolio; |
— | 0.29%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares S&P 500® High Quality Portfolio; |
— | 0.60%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy |
| 113 |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio and PowerShares DWA Utilities Momentum Portfolio (the Trustees noted that prior to December 17, 2013, licensing fees were excluded from the Expense Cap); and |
— | 0.60%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each other Fund. |
The Trustees noted that the Adviser represented that it does not serve as the investment adviser to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds, but that the Adviser provides sub-advisory services to clients with comparable investment strategies as certain of the Funds. The Trustees further noted the Adviser’s explanation with respect to the sub-advisory fees it receives for such services in comparison to the advisory fees charged to the Funds. The Trustees noted that each Fund’s advisory fee was:
— | higher than the median advisory fee of its ETF peer funds (except for the advisory fee of each of PowerShares Financial Preferred Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio and PowerShares International Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its ETF peer funds); and |
— | higher than the median advisory fee of its open-end index peer funds (except for the advisory fee of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares High Yield Equity Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median advisory fee of its open-end actively-managed peer funds. |
The Trustees determined that the advisory fees were reasonable, noting the complexity of the indexes, the distinguishing factors of the Funds, and the administrative, operational and management oversight costs for the Adviser. With respect to the Funds’ net expense ratios, the Trustees noted that the net expense ratio for each Fund was:
— | higher than the median net expense ratio of its ETF peer funds (except for the net expense ratio of each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers Portfolio and PowerShares S&P 500® High Quality Portfolio, which was equal to or less than the median net expense ratio of its ETF peer funds); and |
— | higher than the median net expense ratio of its open-end index peer funds (except for the net expense ratio of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio, PowerShares DWA Utilities Momentum Portfolio, PowerShares Dynamic Large Cap Growth Portfolio, PowerShares Dynamic Networking Portfolio, PowerShares Dynamic Semiconductors Portfolio, PowerShares Dynamic Software Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares High Yield Equity |
| 114 |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Dividend Achievers™ Portfolio and PowerShares S&P 500® High Quality Portfolio, which was lower than the median net expense ratio of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median net expense ratio of its open-end actively-managed peer funds. |
The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds, and noted those Funds for which license fees are included in the Funds’ Expense Caps.
The Board concluded that the advisory fee and expense ratio of each Fund (giving effect to the Fund’s Expense Cap) were reasonable and appropriate in light of the services provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to any of the Funds was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size, expense ratio and expense limitation agreed to by the Adviser. The Trustees noted that, for Funds whose expenses are higher than their respective Expense Caps, any reduction in that Fund’s expenses would be enjoyed by the Adviser, but that Fund shareholders benefit from the lower expense ratio as a result of the Fund’s Expense Cap. The Trustees also noted that the Excess Expense Agreement with the Trust provides that the Adviser is entitled to be reimbursed by each Fund, other than PowerShares Dynamic Market Portfolio and PowerShares DWA NASDAQ Momentum Portfolio, for fees waived or expenses absorbed pursuant to the Expense Cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its Expense Cap. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate, noting the Fund expenses the Adviser has borne as a result of the Expense Cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
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Proxy Voting Policies and Procedures
A description of the Trust’s proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 983-0903. This information is also available on the Securities and Exchange Commission’s (“Commission”) website at www.sec.gov.
Information regarding how each Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 983-0903; or (ii) accessing the Trust’s Form N-PX on the Commission’s website at www.sec.gov.
Quarterly Portfolios
The Trust files its complete schedule of portfolio holdings for the Funds with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Trust’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Trust’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
Frequency Distribution of Discounts and Premiums
A table showing the number of days the market price of each Fund’s shares was greater than the Fund’s net asset value, and the number of days it was less than the Fund’s net asset value (i.e., premium or discount) for the most recently completed calendar year, and the calendar quarters since that year end (or the life of the Fund, if shorter) may be found at the Fund’s website at www.invescopowershares.com.
©2014 Invesco PowerShares Capital Management LLC | P-PS-AR-5 | |||||
3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | ||||||
invescopowershares.com 800.983.0903 | @PowerShares |
April 30, 2014 |
2014 Annual Report to Shareholders
PPA | PowerShares Aerospace & Defense Portfolio | |
PZD | PowerShares CleantechTM Portfolio | |
PDP | PowerShares DWA Momentum Portfolio (formerly PowerShares DWA Technical LeadersTM Portfolio) | |
PSP | PowerShares Global Listed Private Equity Portfolio | |
PGJ | PowerShares Golden Dragon China Portfolio | |
PBP | PowerShares S&P 500 BuyWrite Portfolio | |
SPHQ | PowerShares S&P 500® High Quality Portfolio | |
PHO | PowerShares Water Resources Portfolio | |
PBW | PowerShares WilderHill Clean Energy Portfolio | |
PUW | PowerShares WilderHill Progressive Energy Portfolio |
The Market Environment | 3 | |||
Manager’s Analysis | 4 | |||
Specialty Portfolios | ||||
Schedules of Investments | ||||
24 | ||||
25 | ||||
PowerShares DWA Momentum Portfolio (PDP) (formerly PowerShares DWA Technical LeadersTM Portfolio) | 27 | |||
29 | ||||
31 | ||||
33 | ||||
38 | ||||
40 | ||||
41 | ||||
43 | ||||
Statements of Assets and Liabilities | 46 | |||
Statements of Operations | 48 | |||
Statements of Changes in Net Assets | 50 | |||
Financial Highlights | 54 | |||
Notes to Financial Statements | 59 | |||
Report of Independent Registered Public Accounting Firm | 72 | |||
Fees and Expenses | 73 | |||
Tax Information | 75 | |||
Trustees and Officers | 76 | |||
Board Considerations Regarding Continuation of Investment Advisory Agreement | 81 |
| 2 |
|
Domestic Equity
The U.S. equity market rose to multiyear or all-time highs during the fiscal year ended April 30, 2014.1 Corporate earnings were resilient in the face of modest economic growth, driven by strong profitability across many sectors, and fundamentals for corporations and consumers remained relatively stable following significant recovery in prior years.
However, the fiscal year began with capital markets in the U.S. declining. In May and June 2013, equity and fixed income markets fell following then-U.S. Federal Reserve (the “Fed”) Chairman Ben Bernanke’s comments suggesting that the time was approaching to reduce, or “taper,” the size of its bond buying economic stimulus program. This sell-off was brief but broad, and few asset classes were immune. Markets stabilized in mid-summer and generally rose, with some brief interruptions, through the end of 2013. The Fed’s announcement in December that tapering of its bond purchases would begin in early 2014 had little effect on equities as the announcement was widely anticipated. After strong performance in the second half of 2013, the U.S. equity market turned volatile in the first four months of 2014 as investors worried that stocks may have risen too high, too fast in 2013. Adding to this investor uncertainty during 2014 was political upheaval in Ukraine and signs of economic sluggishness in the U.S. and China.
1 | Source: Reuters |
International Market Environment
The fiscal year ended April 30, 2014 saw strong US and European equity market returns, while emerging markets experienced volatility during the period. The period began with U.S. interest rates on 10-year treasuries rising 140 basis points over the summer of 2013.1 This spike in rates caused the U.S. Dollar to rise in value and pressure commodity sensitive emerging market economies. Despite this rise in rates European and U.S. economic fundamentals continued to improve. The U.S. Federal Reserve (the “Fed”) reassured investors that asset purchases and low Fed Funds rates would remain in place as long as needed.
During the 3rd and 4th calendar quarters of 2013, emerging market fundamentals improved and China’s government planned sweeping reforms. Spanish and Italian bond yields-which had been as high as 7% in mid-2012-continued their decline in the second half of 2013 to finish the calendar year at their lowest level since the onset of the Greek financial crisis in 2010.1 These factors caused global equity markets to finish 2013 strong despite the U.S. Federal Open Market Committee announcing that it would taper asset purchases.
Since the start of 2014, global equity markets have had to contend with multiple headwinds. In Europe, tensions between Ukraine and Russia have had those countries on the brink of war, which could potentially destabilize the region. In the U.S., growth in the housing market and weakness in retail sales has caused concern that economic growth may be slowing. In Japan, Prime Minister Abe’s decision to raise sales taxes has undermined confidence and caused the Yen to strengthen in value. Finally, China’s currencies depreciated and credit spreads have widened as fears of default and a real estate bubble pressure Chinese equities. Despite these headwinds, U.S. equities have made new all-time highs and European equities have also made multi-year highs. Emerging markets and Japan have lagged their European and U.S. counterparts.
1 | Source: Bloomberg as of 4/30/2014 |
| 3 |
|
PPA | Manager’s Analysis | |
PowerShares Aerospace & Defense Portfolio (PPA) |
As an index fund, the PowerShares Aerospace & Defense Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the SPADETM Defense Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of aerospace and defense companies that comprise the Index.
ISBC, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider selects constituents for the Index such that it seeks to measure the performance of securities in the defense, military, homeland security and space marketplace. The Index includes companies that are principally engaged in the research the development, manufacture, operation and support of U.S. defense, military, homeland security and space operations listed on the NYSE, NYSE MKT or quoted on the NASDAQ. To have its securities eligible for inclusion in the Index, a company’s securities must, during the 25 days prior to the date that its securities are included in the Index, have maintained a minimum $100 million market cap, a minimum $5 daily sale price and an average daily trading volume of 50,000 shares. A company must also have a quarterly sales/revenue/turnover of at least $10 million for the two announced quarters prior to the inclusion date. Companies that qualify and are selected for inclusion in the Index are weighted according to a modified market capitalization methodology. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 40.59%. On a net asset value (“NAV”) basis, the Fund returned 40.52%. During the same time period, the Index returned 41.45%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite Aerospace & Defense Index (the “Benchmark Index”) returned 42.58%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 28 securities. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors due primarily to its exposure to the aerospace and defense sector.
The performance of the Fund differed from the Benchmark Index in part because the Index, and as such the Fund, limits its constituents to companies that are involved in U.S. defense, military, homeland security and space operations, whereas the Benchmark Index includes companies that are involved in the commercial aerospace industry as well. More specifically, relative to the Benchmark Index, the Fund was most overweight in the
information technology services industry and most underweight in the aerospace & defense industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the information technology and materials sectors, respectively. Telecommunication services was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Lockheed Martin Corp., an aerospace & defense company (portfolio average weight of 6.49%) and Boeing Co. (The), an aerospace & defense company (portfolio average weight of 6.43%). Positions that detracted most significantly from the Fund’s return included Triumph Group, Inc., an aerospace & defense company (portfolio average weight of 1.63%); and Intelsat SA, an alternative carriers company (portfolio average weight of 0.5%).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Aerospace & Defense | 78.9 | |||
IT Services | 7.6 | |||
Communications Equipment | 4.3 | |||
Containers & Packaging | 3.0 | |||
Electronic Equipment, Instruments & Components | 2.4 | |||
Machinery | 1.8 | |||
Construction & Engineering | 1.3 | |||
Diversified Telecommunication Services | 0.7 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Boeing Co. (The) | 6.7 | |||
United Technologies Corp. | 6.6 | |||
Lockheed Martin Corp. | 6.6 | |||
Honeywell International, Inc. | 6.5 | |||
General Dynamics Corp. | 5.3 | |||
Precision Castparts Corp. | 5.2 | |||
Northrop Grumman Corp. | 4.5 | |||
Raytheon Co. | 4.4 | |||
Textron, Inc. | 4.2 | |||
Rockwell Collins, Inc. | 3.9 | |||
Total | 53.9 |
| 4 |
|
PowerShares Aerospace & Defense Portfolio (PPA) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
SPADETM Defense Index | 41.45 | % | 18.67 | % | 67.11 | % | 21.63 | % | 166.24 | % | 11.27 | % | 148.25 | % | ||||||||||||||||
S&P Composite Aerospace & Defense Index | 42.58 | 19.51 | 70.71 | 23.61 | 188.55 | 13.09 | 184.91 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 40.52 | 17.86 | 63.74 | 20.82 | 157.43 | 10.55 | 134.84 | |||||||||||||||||||||||
Market Price Return | 40.59 | 17.85 | 63.69 | 20.83 | 157.55 | 10.56 | 134.93 |
Fund Inception: October 26, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.79%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 5 |
|
PZD | Manager’s Analysis | |
PowerShares CleantechTM Portfolio (PZD) |
As an index fund, the PowerShares CleantechTM Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of The CleantechTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in stocks of cleantech companies that comprise the Index and American depositary receipts based on the stocks in the Index.
Cleantech Indices LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider identifies the securities comprising the Index and considers a company to be a cleantech company when it derives at least 50% of its revenues or operating profits from cleantech businesses, which are defined as: businesses that provide knowledge-based products (or services) that add economic value by reducing cost and raising productivity and/or product performance, while reducing the consumption of resources and the negative impact on the environment and public health. The Index focuses on companies that are leaders in the innovation and commercial deployment of cleantech products across a broad range of industries. To be eligible for inclusion in the Index, a company must derive at least 50% of its revenue or operating profit from cleantech businesses, maintain a three-month average market capitalization of at least $200 million, maintain a one-month average floated market capitalization of at least $150 million, maintain a listing on a securities exchange, and have a minimum average trading value of at least $200,000 per trading day for the trailing three-month period. The Index Provider further screens securities that meet the selection criteria. These screens include, but are not limited to, profitability, earnings growth and quality, business strategy, industry leadership and position, sector redundancy, intellectual property, impact on the environment, management quality, solvency, existing litigation and governance issues. In general, the Index equally weights its component securities within several bands based upon their market capitalization. Below a certain threshold, the Index Provider determines the bands based upon floated market capitalization. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 27.15%. On a net asset value (“NAV”) basis, the Fund returned 26.52%. During the same time period, the Index returned 25.91%. During the fiscal year, the Fund fully replicated the components of the Index. The Fund outperformed the return of its Index primarily due to the Index being calculated on a price return basis, which does not reflect income from constituent securities, while the Fund’s NAV is calculated inclusive of such items.
For the fiscal year ended April 30, 2014, the heavy electrical equipment sub-industry contributed most significantly to the Fund’s return, followed by the industrial machinery and semiconductor equipment sub-industries, respectively. The construction machinery & heavy trucks sub-industry detracted
most significantly from the Fund’s return, followed by the renewable electricity and water utilities sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Vestas Wind Systems A/S, a heavy electrical equipment company (portfolio average weight of 2.46%) and GT Advanced Technologies Inc., a semiconductor equipment company (portfolio average weight of 1.08%). Positions that detracted most significantly from the Fund’s return included Energy Development Corp., a renewable electricity company (portfolio average weight of 1.46%); and Westport Innovations, Inc., a machinery company (portfolio average weight of 0.46%).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Electrical Equipment | 17.4 | |||
Machinery | 16.2 | |||
Electronic Equipment, Instruments & Components | 9.4 | |||
Chemicals | 9.3 | |||
Software | 7.2 | |||
Industrial Conglomerates | 7.1 | |||
Professional Services | 6.4 | |||
Auto Components | 6.1 | |||
Semiconductors & Semiconductor Equipment | 5.8 | |||
Commercial Services & Supplies | 3.5 | |||
Construction & Engineering | 2.8 | |||
Aerospace & Defense | 2.3 | |||
Life Sciences Tools & Services | 2.2 | |||
Building Products | 2.2 | |||
Independent Power Producers & Energy Traders | 2.1 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Novozymes A/S, Class B | 3.4 | |||
Vestas Wind Systems A/S | 3.3 | |||
Koninklijke DSM NV | 3.2 | |||
Schneider Electric SA | 3.2 | |||
Corning, Inc. | 3.2 | |||
BorgWarner, Inc. | 3.1 | |||
SGS SA | 3.1 | |||
Roper Industries, Inc. | 3.1 | |||
Alfa Laval AB | 3.0 | |||
Johnson Controls, Inc. | 3.0 | |||
Total | 31.6 |
| 6 |
|
PowerShares CleantechTM Portfolio (PZD) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
CleantechTM Index—PI | 25.91 | % | 2.15 | % | 6.58 | % | 10.55 | % | 65.15 | % | 3.42 | % | 28.79 | % | ||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 26.52 | 2.98 | 9.21 | 11.35 | 71.18 | 3.91 | 33.42 | |||||||||||||||||||||||
Market Price Return | 27.15 | 3.03 | 9.36 | 11.25 | 70.42 | 3.92 | 33.51 |
Fund Inception: October 24, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.76%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund and Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
PI— | Price only, and does not reflect dividends paid by the holdings in the Index. |
| 7 |
|
PDP | Manager’s Analysis | |
PowerShares DWA Momentum Portfolio (PDP) |
Effective October 4, 2013, the name of the Fund changed from PowerShares DWA Technical LeadersTM Portfolio to PowerShares DWA Momentum Portfolio.
As an index fund, the PowerShares DWA Momentum Portfolio (the “Fund”), formerly the PowerShares DWA Technical LeadersTM Portfolio, is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dorsey Wright Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks that comprise the Index.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes common stocks pursuant to a proprietary selection methodology that is designed to identify companies listed on the NYSE, NYSE MKT or the NASDAQ that demonstrate powerful relative strength characteristics. The Index Provider evaluates companies quarterly and ranks a universe of mid- and large-capitalization U.S. stocks traded on the NYSE, NYSE MKT or the NASDAQ using a proprietary relative strength methodology. The methodology takes into account, among other things, the performance of each of the approximately 1,000 largest companies in the eligible universe as compared to a benchmark index and the relative performance of industry sectors and sub-sectors. The Index Provider identifies approximately 100 of these stocks for inclusion in the Underlying Index. The stocks that the Index Provider includes receive a modified equal weighting.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 16.65%. On a net asset value (“NAV”) basis, the Fund returned 16.71%. During the same time period, the Index returned 16.42%. During the fiscal year, after reflecting the Fund’s operating expenses, the Fund outperformed its Index primarily because the Index does not reflect dividends in its total return index calculation.
During this same time period, the Russell 3000® Growth Index (the “Benchmark Index”) returned 20.72%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 1,820 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of that of a broader-based market benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and exposure to growth stocks. The Benchmark Index performance comparison is a useful measure for investors as a broad representation of the U.S. equity market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
More specifically, relative to the Benchmark Index, the Fund was overweight in the materials sector and underweight in the information technology sector during the fiscal year ended April 30, 2014. Therefore, a majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the consumer discretionary sector contributed most significantly to the Fund’s return, followed by the industrials and health care sectors, respectively. The financials sector detracted most significantly, followed by the consumer staples and utilities sectors, respectively.
Positions that contributed most significantly to the Fund’s return included Gilead Sciences, Inc., a health care company (portfolio average weight of 2.72%) and Jazz Pharmaceuticals PLC, a health care company (portfolio average weight of 1.87%). Positions that detracted most significantly from the Fund’s return included ARIAD Pharmaceuticals, Inc., a health care company (no longer held at fiscal year end); and Ventas, Inc., a financials company (no longer held at fiscal year-end).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Consumer Discretionary | 29.5 | |||
Industrials | 18.2 | |||
Health Care | 17.1 | |||
Materials | 13.4 | |||
Information Technology | 9.0 | |||
Energy | 4.9 | |||
Financials | 4.5 | |||
Consumer Staples | 2.3 | |||
Utilities | 0.6 | |||
Telecommunication Services | 0.5 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Apple, Inc. | 3.2 | |||
Jazz Pharmaceuticals PLC | 2.9 | |||
Gilead Sciences, Inc. | 2.8 | |||
Starz, Class A | 2.8 | |||
Priceline Group, Inc. (The) | 2.6 | |||
O’Reilly Automotive, Inc. | 2.5 | |||
Alexion Pharmaceuticals, Inc. | 2.5 | |||
TRW Automotive Holdings Corp. | 2.2 | |||
Airgas, Inc. | 2.2 | |||
Regeneron Pharmaceuticals, Inc. | 2.1 | |||
Total | 25.8 |
| 8 |
|
PowerShares DWA Momentum Portfolio (PDP) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dorsey Wright Technical LeadersTM Index | 16.42 | % | 11.80 | % | 39.75 | % | 21.42 | % | 163.92 | % | 6.47 | % | 56.71 | % | ||||||||||||||||
Russell 3000® Growth Index | 20.72 | 13.12 | 44.74 | 19.54 | 144.14 | 8.14 | 75.13 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 16.71 | 12.20 | 41.24 | 21.73 | 167.33 | 6.63 | 58.41 | |||||||||||||||||||||||
Market Price Return | 16.65 | 12.14 | 41.02 | 21.73 | 167.30 | 6.59 | 57.95 |
Fund Inception: March 1, 2007
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.74%, including acquired fund fees and expenses of 0.07%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay
on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 9 |
|
PSP | Manager’s Analysis | |
PowerShares Global Listed Private Equity Portfolio (PSP) |
As an index fund, the PowerShares Global Listed Private Equity Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Red Rocks Global Listed Private Equity Index (the “Index”). The Fund generally will invest at least 90% of its total assets in securities (including American depositary receipts (“ADRs”) and global depositary receipts (“GDRs”)) that comprise the Index.
Red Rocks Capital LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes securities in the Index pursuant to a proprietary selection methodology. The Index is comprised of 40 to 75 securities, ADRs and GDRs of listed private equity companies. To be considered for inclusion in the Index, a security must invest a majority of its assets in, lend capital to, or provide services to, private companies, or must have a stated intention to do so. The Index Provider identifies private equity companies that will comprise the Index based upon the reputation, management, financial data, historical performance and the need for diversification within the Index. The Index views diversification from four different perspectives: a) stage of investment; b) type of capital; c) sector; and d) geography. Each listed private equity company must have a market capitalization of at least $100 million before inclusion in the Index. The Index uses float-adjusted, modified market capitalization weightings, with no component having a weight greater than 10%. The combined weight of all Index components that individually equal a 5% or greater weighting of the Index will not exceed 50% of the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 16.31%. On a net asset value (“NAV”) basis, the Fund returned 16.20%. During the same time period, the Blended-Red Rocks Global Listed Private Equity Index returned 17.56%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to operating expenses, fees and other trading costs that the Fund incurred during the period.
For the fiscal year ended April 30, 2014, the asset management & custody banks sub-industry contributed most significantly to the Fund’s return, followed by the multi-sector holdings and steel sub-industries, respectively. Internet software & services was the only detracting sub-industry.
Positions that contributed most significantly to the Fund’s return included The Blackstone Group LP, (no longer held at fiscal year-end); and Eurazeo SA, a diversified financial services company (portfolio average weight of 3.16%). Positions that detracted most significantly from the Fund’s return included Leucadia National Corp., a diversified financial services company (portfolio average weight of 3.53%); and JAFCO Co. Ltd., a capital markets company (portfolio average weight of 2.45%).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Capital Markets | 52.3 | |||
Diversified Financial Services | 25.4 | |||
Machinery | 4.6 | |||
Metals & Mining | 3.5 | |||
Internet Software & Services | 2.6 | |||
Food Products | 1.2 | |||
Industrial Conglomerates | 1.1 | |||
Money Market Funds Plus Other Assets Less Liabilities | 9.3 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Onex Corp. | 5.6 | |||
Partners Group Holding AG | 4.9 | |||
3i Group PLC | 4.7 | |||
Melrose Industries PLC | 4.6 | |||
Wendel | 4.0 | |||
Eurazeo SA | 4.0 | |||
Leucadia National Corp. | 3.9 | |||
Ratos AB, Class B | 3.8 | |||
Fosun International Ltd. | 3.5 | |||
Intermediate Capital Group PLC | 3.3 | |||
Total | 42.3 |
| 10 |
|
PowerShares Global Listed Private Equity Portfolio (PSP) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-Red Rocks Global Listed Private Equity Index†† | 17.56 | % | 8.45 | % | 27.55 | % | 22.62 | % | 177.16 | % | (1.02 | )% | (7.39 | )% | ||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 16.20 | 7.24 | 23.35 | 19.46 | 143.33 | (3.81 | ) | (25.30 | ) | |||||||||||||||||||||
Market Price Return | 16.31 | 7.18 | 23.13 | 19.60 | 144.73 | (3.76 | ) | (25.01 | ) |
Fund Inception: October 24, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 2.19%, including acquired fund fees and expenses of 1.49%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund and Blended-Index returns are based on the inception date of the Fund. |
†† | The Blended-Red Rocks Global Listed Private Equity Index is comprised of the performance of the Listed Private Equity Index, the Fund’s previous underlying index, from Fund inception through the conversion date, September 30, 2009, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 11 |
|
PGJ | Manager’s Analysis | |
PowerShares Golden Dragon China Portfolio (PGJ) |
As an index fund, the PowerShares Golden Dragon China Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the NASDAQ Golden Dragon China Index (the “Index”). The Fund generally will invest at least 90% of its total assets in securities of companies deriving a majority of their revenues from the People’s Republic of China and that comprise the Index.
The NASDAQ OMX Group, Inc. (or the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes securities in the Index to provide access to the unique economic opportunities taking place in China while still providing investors with the transparency offered with U.S. exchange listed securities. Securities eligible for inclusion in the Index must be issued by a company headquartered or incorporated in the People’s Republic of China, be listed on the NASDAQ, the NYSE or NYSE MKT, have a minimum market capitalization of $100 million and have a minimum three-month average daily dollar trading volume of $250,000, and may include common stocks, ordinary shares, American depositary receipts (“ADRs”), shares of beneficial interest, limited partnership interests or tracking stocks. The Index Provider calculates the Index’s composition using a modified market capitalization-weighting methodology, such that the maximum weight of any security does not exceed 8% of the Index, while at no time permitting more than five securities to reach that 8% cap. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 42.46%. On a net asset value (“NAV”) basis, the Fund returned 42.28%. During the same time period, the Index returned 42.39%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the FTSE/Xinhua China 25 Index (the “Benchmark Index”) returned (2.71)%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 25 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of another index representative of equity exposure to Chinese companies. The Benchmark Index was selected for its recognition in the marketplace.
The performance of the Fund differed from the Benchmark Index primarily because of substantially different individual company components and sector weightings. Additionally, the Fund invests in Chinese companies, as defined by the Index methodology, listed on U.S. exchanges, whereas the Benchmark Index is composed of Chinese stocks listed on the Hong Kong stock exchange. A comparison to the Benchmark Index is still relevant as the Fund and Benchmark Index are a representation of equity exposure to Chinese companies.
Relative to the Benchmark Index, the Fund was most overweight in the information technology sector and most underweight in the financials sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to the allocation to the information technology sector.
For the fiscal year ended April 30, 2014, the information technology sector contributed most significantly to the Fund’s return, followed by the consumer discretionary and health care sectors, respectively. The energy sector detracted most significantly from the Fund’s return, followed by the financials and utilities sectors, respectively.
Positions that contributed most significantly to the Fund’s return included Ctrip.com International Ltd. ADR, an Internet retail company (portfolio average weight of 7.52%) and Baidu, Inc. ADR, an Internet software & services company (portfolio average weight of 8.08%). Positions that detracted most significantly from the Fund’s return included Mindray Medical International Ltd. ADR, a health care equipment company (portfolio average weight of 3.76%); and China HGS Real Estate, Inc., a real estate development company (portfolio average weight of 0.37%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Information Technology | 53.0 | |||
Consumer Discretionary | 23.1 | |||
Health Care | 8.1 | |||
Telecommunication Services | 5.7 | |||
Energy | 4.4 | |||
Industrials | 2.5 | |||
Financials | 2.3 | |||
Materials | 0.5 | |||
Utilities | 0.3 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.1 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Baidu, Inc. ADR | 8.4 | |||
Ctrip.com International Ltd. ADR | 8.1 | |||
Qihoo 360 Technology Co. Ltd. ADR | 7.2 | |||
NetEase, Inc. ADR | 5.9 | |||
Vipshop Holdings Ltd. ADR | 5.0 | |||
China Mobile Ltd. ADR | 4.7 | |||
New Oriental Education & Technology Group, Inc. ADR | 4.0 | |||
SINA Corp. | 3.8 | |||
Mindray Medical International Ltd. ADR | 3.5 | |||
Youku Tudou, Inc. ADR | 3.1 | |||
Total | 53.7 |
| 12 |
|
PowerShares Golden Dragon China Portfolio (PGJ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
NASDAQ Golden Dragon China Index | 42.39 | % | 0.39 | % | 1.18 | % | 11.72 | % | 74.03 | % | 8.89 | % | 122.51 | % | ||||||||||||||||
FTSE/Xinhua China 25 Index | (2.71 | ) | (4.73 | ) | (13.54 | ) | 5.07 | 28.07 | 9.89 | 142.47 | ||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 42.28 | 0.30 | 0.89 | 11.20 | 70.01 | 8.37 | 112.61 | |||||||||||||||||||||||
Market Price Return | 42.46 | 0.36 | 1.10 | 11.15 | 69.61 | 8.31 | 111.66 |
Fund Inception: December 9, 2004
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.75%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that
a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 13 |
|
PBP | Manager’s Analysis | |
PowerShares S&P 500 BuyWrite Portfolio (PBP) |
As an index fund, the PowerShares S&P 500 BuyWrite Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the CBOE S&P 500 BuyWriteTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in securities that comprise the Index and will write (sell) call options thereon.
The Chicago Board Options Exchange, Incorporated (the “Index Provider”) compiles, maintains and calculates the Index. The Index measures the total rate of return of an S&P 500® Index covered call strategy. This strategy consists of holding a portfolio indexed to the S&P 500® Index and selling a succession of covered call options, each with an exercise price at or above the prevailing price level of the S&P 500® Index. The Index provides a benchmark measure of the total return performance of this hypothetical strategy. The Index reinvests dividends paid on the component stocks underlying the S&P 500® Index and the dollar value of option premiums received from covered call options. The Index assumes that the call options are written (sold) on the third Friday of each month and expire in the next calendar month after they are written. The Index assumes that the call options are held until their expiration. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 9.50%. On a net asset value (“NAV”) basis, the Fund returned 9.34%. During the same time period, the Index returned 10.13%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Index (the “Benchmark Index”) returned 20.44%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 500 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a broad-based market benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. equity market.
During the period, the Fund underperformed the Benchmark Index primarily because of the written covered call option strategy. While the sale of the call options generated premium income for the Fund, this was not enough to make up for the rising market. Many of the Fund’s options were settled at a loss because the strike price was below the market price at expiration.
For the fiscal year ended April 30, 2014, the information technology sector contributed most significantly to the Fund’s return, followed by the financials and health care sectors, respectively. Telecommunication services was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Apple, Inc., an information technology company (portfolio average weight of 2.97%) and Google Inc., Class A, an information technology company (portfolio average weight of 1.73%). Positions that detracted most significantly from the Fund’s return included Verizon Communications, Inc., a telecommunication services company (portfolio average weight of 0.98%); and Philip Morris International, Inc., a consumer staples company (portfolio average weight of 0.91%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Information Technology | 18.8 | |||
Financials | 16.3 | |||
Health Care | 13.4 | |||
Consumer Discretionary | 12.0 | |||
Industrials | 10.9 | |||
Energy | 10.8 | |||
Consumer Staples | 9.9 | |||
Materials | 3.6 | |||
Utilities | 3.2 | |||
Telecommunication Services | 2.5 | |||
Other Assets Less Liabilities | (1.4) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Apple, Inc. | 3.2 | |||
Exxon Mobil Corp. | 2.7 | |||
Microsoft Corp. | 1.8 | |||
Johnson & Johnson | 1.7 | |||
General Electric Co. | 1.6 | |||
Chevron Corp. | 1.5 | |||
Wells Fargo & Co. | 1.4 | |||
Berkshire Hathaway, Inc., Class B | 1.4 | |||
Procter & Gamble Co. (The) | 1.4 | |||
JPMorgan Chase & Co. | 1.3 | |||
Total | 18.0 |
| 14 |
|
PowerShares S&P 500 BuyWrite Portfolio (PBP) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
Index | 1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | ||||||||||||||||||||||||
Avg. Ann.†† | Cumulative | |||||||||||||||||||||||||||||
CBOE S&P 500 BuyWriteTM Index | 10.13 | % | 7.94 | % | 25.75 | % | 11.44 | % | 71.87 | % | 3.50 | % | 24.46 | % | ||||||||||||||||
S&P 500® Index | 20.44 | 13.83 | 47.48 | 19.14 | 140.02 | 6.39 | 48.35 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 9.34 | 7.09 | 22.81 | 10.52 | 64.90 | 2.65 | 18.07 | |||||||||||||||||||||||
Market Price Return | 9.50 | 7.15 | 23.01 | 10.49 | 64.67 | 2.67 | 18.26 |
Fund Inception: December 20, 2007
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. According to the Fund’s current prospectus, the Fund’s expense ratio 0.75% is expressed as a unitary management fee to cover operating expenses and expenses incurred in connection with managing the portfolio. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 15 |
|
SPHQ | Manager’s Analysis | |
PowerShares S&P 500® High Quality Portfolio (SPHQ) |
As an index fund, the PowerShares S&P 500® High Quality Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the S&P 500® High Quality Rankings Index (the “Index”). The Fund generally will invest at least 90% of its total assets in securities that comprise the Index.
The Index is designed to provide exposure to the constituents of the S&P 500® Index that S&P Quality Rankings identifies as high quality stocks. Standard & Poor’s has provided Earnings and Dividend Rankings, commonly referred to as Quality Rankings, on U.S. common stocks since 1956. Quality Rankings reflect the long term growth and stability of a company’s earnings and dividends. Standard & Poor’s generates Quality Rankings by using a computerized system based on per-share earnings and dividends records of the most recent 10 years. Standard & Poor’s computes basic scores for earnings and dividends, and then adjusts the basic scores as indicated by a set of predetermined modifiers for change in the rate of growth, stability within long-term trend and cyclicality. Standard & Poor’s then combines adjusted scores for earnings and dividends to yield a final ranking. If a company within the S&P 500® Index does not have a Quality Ranking assigned to it, it is not considered for inclusion within the Index. S&P 500® Index constituents with Quality Rankings of A- or above are selected for inclusion in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 19.09%. On a net asset value (“NAV”) basis, the Fund returned 19.15%. During the same time period, the Blended-S&P 500® High Quality Rankings Index returned 19.49%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Index (the “Benchmark Index”) returned 20.44%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 500 securities. The Fund provided this additional comparative benchmark because of its recognition in the market place and to help investors better understand how the investment results of the Fund compare to the performance of a broad-based U.S. stock market benchmark.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that selects stocks based on S&P Quality Rankings, which takes into account earnings and dividends, while the Benchmark Index is a broad-based U.S. market index.
Relative to the Benchmark Index, the Fund was most overweight in the industrials sector and most underweight in the information
technology sector during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to stock selection within the consumer discretionary sector, as well as allocation to and stock selection within the information technology sector.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the consumer staples and consumer discretionary sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Lockheed Martin Corp., an industrials company (portfolio average weight of 0.86%) and L-3 Communications Holdings, Inc., an industrials company (portfolio average weight of 1.23%). Positions that detracted most significantly from the Fund’s return included Target Corp., a consumer discretionary company (portfolio average weight of 1.12%); and Ralph Lauren Corp., a consumer discretionary company (portfolio average weight of 0.76%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Industrials | 27.2 | |||
Consumer Staples | 19.7 | |||
Consumer Discretionary | 19.3 | |||
Health Care | 9.3 | |||
Materials | 8.3 | |||
Financials | 5.7 | |||
Information Technology | 4.7 | |||
Utilities | 3.7 | |||
Energy | 2.1 | |||
Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Lorillard, Inc. | 1.3 | |||
C.H. Robinson Worldwide, Inc. | 1.3 | |||
Lockheed Martin Corp. | 1.2 | |||
Johnson & Johnson | 1.2 | |||
Coca-Cola Co. (The) | 1.2 | |||
3M Co. | 1.2 | |||
Union Pacific Corp. | 1.2 | |||
Wal-Mart Stores, Inc. | 1.2 | |||
Sigma-Aldrich Corp. | 1.2 | |||
United Technologies Corp. | 1.2 | |||
Total | 12.2 |
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PowerShares S&P 500® High Quality Portfolio (SPHQ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-S&P 500® High Quality Rankings Index†† | 19.49 | % | 15.31 | % | 53.33 | % | 18.84 | % | 137.00 | % | 4.58 | % | 45.72 | % | ||||||||||||||||
S&P 500® Index | 20.44 | 13.83 | 47.48 | 19.14 | 140.02 | 7.11 | 78.14 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 19.15 | 14.87 | 51.58 | 18.47 | 133.34 | 4.48 | 44.50 | |||||||||||||||||||||||
Market Price Return | 19.09 | 14.85 | 51.50 | 18.45 | 133.22 | 4.42 | 43.77 |
Fund Inception: December 6, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.43%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended-Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | The Blended-S&P 500® High Quality Rankings Index is comprised of the performance of the Value Line Timeliness Select Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 29, 2010, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
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PHO | Manager’s Analysis | |
PowerShares Water Resources Portfolio (PHO) |
As an index fund, the PowerShares Water Resources Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the NASDAQ OMX US Water IndexSM (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks and American depositary receipts (“ADR”) of companies in the water industry that comprise the Index.
NASDAQ OMX Group, Inc. (or the “Index Provider”) compiles, maintains and calculates the Index. The Index is comprised of U.S. exchange-listed companies that create products designed to conserve and purify water for homes, businesses and industries. Securities eligible for inclusion in the Index include common stocks, ordinary shares, depositary receipts (both American and global), depositary shares or limited partnership interests. Eligible securities must also meet the following criteria: a) have issuers classified by SustainableBusiness.com LLC as participating in the “Green Economy,” an environmental and clean energy sector portion of the NASDAQ OMX Green Economy Global Benchmark Index, which includes 350 securities from 13 different environmental sectors; b) be listed on NASDAQ, NYSE, or NYSE MKT; c) only one security per issuer is permitted; d) the securities must have a minimum worldwide market capitalization of $50 million; and e) the security must have a minimum three-month average daily dollar trading volume of $250,000. The Index Provider evaluates securities annually for eligibility. Each quarter, the Index Provider rebalances the Index using a modified liquidity weighting methodology, such that the maximum weight of any security does not exceed 8% of the Index, while at no time permitting more than five securities to reach that 8% cap. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 18.17%. On a net asset value (“NAV”) basis, the Fund returned 18.16%. During the same time period, the Blended- NASDAQ OMX US Water IndexSM returned 18.80%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the health care and materials sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Flowserve Corp., an industrial machinery company (portfolio average weight of 8.24%) and Pentair Ltd., a machinery company (portfolio average weight of 8.28%). Positions that detracted most significantly from the Fund’s return included Cia de Saneamento Basico do Estado de Sao Paulo ADR, a water
utilities company (portfolio average weight of 3.62%); and Layne Christensen Co., a construction & engineering company (portfolio average weight of 1.21%).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Machinery | 47.2 | |||
Water Utilities | 16.9 | |||
Industrial Conglomerates | 8.4 | |||
Life Sciences Tools & Services | 7.3 | |||
Electronic Equipment, Instruments & Components | 5.5 | |||
Construction & Engineering | 4.3 | |||
Commercial Services & Supplies | 3.9 | |||
Electrical Equipment | 2.8 | |||
Chemicals | 2.5 | |||
Multi-Utilities | 1.1 | |||
Other Assets Less Liabilities | 0.1 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Roper Industries, Inc. | 8.4 | |||
Pall Corp. | 8.1 | |||
Pentair Ltd. | 7.6 | |||
Flowserve Corp. | 7.4 | |||
Waters Corp. | 7.3 | |||
Itron, Inc. | 4.5 | |||
Lindsay Corp. | 4.3 | |||
Cia de Saneamento Basico do Estado de Sao Paulo ADR | 4.2 | |||
Valmont Industries, Inc. | 4.2 | |||
American Water Works Co., Inc. | 4.2 | |||
Total | 60.2 |
| 18 |
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PowerShares Water Resources Portfolio (PHO) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
Index | 1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | ||||||||||||||||||||||||
Avg. Ann.††† | Cumulative | |||||||||||||||||||||||||||||
Blended-NASDAQ OMX US Water IndexSM†† | 18.80 | % | 10.23 | % | 33.92 | % | 14.54 | % | 97.11 | % | 8.49 | % | 98.33 | % | ||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 18.16 | 9.36 | 30.77 | 13.82 | 91.01 | 7.15 | 78.59 | |||||||||||||||||||||||
Market Price Return | 18.17 | 9.36 | 30.79 | 13.84 | 91.22 | 7.01 | 76.57 |
Fund Inception: December 6, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.62%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund and Blended-Index returns are based on the inception date of the Fund. |
†† | The Blended-NASDAQ OMX US Water IndexSM is comprised of the performance of the Palisades Water Index, the Fund’s previous underlying index, from Fund inception through the conversion date, March 1, 2012, followed by the performance of the NASDAQ OMX US Water IndexSM, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
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PBW | Manager’s Analysis | |
PowerShares WilderHill Clean Energy Portfolio (PBW) |
As an index fund, the PowerShares WilderHill Clean Energy Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the WilderHill Clean Energy Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies engaged in the business of the advancement of cleaner energy and conservation that comprise the Index.
WilderHill (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its guidelines and mandated procedures, the Index Provider includes stocks in the Index that it believes will substantially benefit from a societal transition toward the use of cleaner energy and conservation. The Index uses modified equal dollar weighting. No single stock may exceed 4% of the total Index weight at the quarterly rebalancing. For a stock to be included in the selection universe, the Index Provider must identify a company as one that has a significant exposure to clean energy, or contribute to the advancement of clean energy or be important to the development of clean energy. Companies in the Index generally (i) help prevent pollutants such as carbon dioxide, nitrous oxide, sulfur oxide or particulates—and avoid carbon or contaminants that harm oceans, land, air or ecosystems structure, (ii) work to further renewable energy efforts and do so in ecologically and economically sensible ways and (iii) incorporate the precautionary principles into their pollution prevention and clean energy efforts. Similarly, companies in the Index generally will not have their majority interests in oil or coal, which are the highest-carbon fuels. Large companies with interests outside clean energy may be included if they are significant to this sector. Components with a market capitalization less than $200 million are weighted at rebalance to one-half of a percent (0.50%). To be eligible for the Index, a stock must have: a. three-month average market capitalization of at least $50 million; and b. three-month average closing price above $1.00 if not currently in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 41.23%. On a net asset value (“NAV”) basis, the Fund returned 41.23%. During the same time period, the Index returned 39.71%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the primary causes for deviation between the Fund’s performance, on a NAV basis, and that of the Index were revenue received by the Fund related to its securities lending program as well as fees and operating expenses that the Fund incurred during the period.
For the fiscal year ended April 30, 2014, the semiconductors sub-industry contributed most significantly to the Fund’s return, followed by the semiconductor equipment and automobile manufacturers sub-industries, respectively. There were no detracting sub-industries.
Positions that contributed most significantly to the Fund’s return included Tesla Motors, Inc., an automobiles company (portfolio average weight of 2.81%) and GT Advanced Technologies, Inc., a semiconductors & semiconductor equipment company (portfolio average weight of 2.73%). Positions that detracted most significantly from the Fund’s return included KiOR, Inc., a oil, gas & consumable fuels company (no longer held at fiscal year end); and Cosan Limited, an oil, gas & consumable fuels company (no longer held at fiscal year end).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Semiconductors & Semiconductor Equipment | 32.6 | |||
Electrical Equipment | 17.7 | |||
Chemicals | 8.9 | |||
Electronic Equipment, Instruments & Components | 7.1 | |||
Independent Power Producers & Energy Traders | 7.0 | |||
Auto Components | 6.7 | |||
Oil, Gas & Consumable Fuels | 6.2 | |||
Construction & Engineering | 4.1 | |||
Commercial Services & Supplies | 2.5 | |||
Electric Utilities | 2.3 | |||
Automobiles | 2.2 | |||
Software | 2.1 | |||
Metals & Mining | 0.5 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.1 | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Calpine Corp. | 2.6 | |||
Maxwell Technologies, Inc. | 2.6 | |||
Gentherm, Inc. | 2.6 | |||
EnerNOC, Inc. | 2.5 | |||
Daqo New Energy Corp. ADR | 2.5 | |||
SunPower Corp. | 2.5 | |||
Itron, Inc. | 2.4 | |||
Sociedad Quimica y Minera de Chile SA ADR | 2.4 | |||
ITC Holdings Corp. | 2.4 | |||
Cytec Industries, Inc. | 2.3 | |||
Total | 24.8 |
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PowerShares WilderHill Clean Energy Portfolio (PBW) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
WilderHill Clean Energy Index | 39.71 | % | (12.74 | )% | (33.55 | )% | (4.99 | )% | (22.57 | )% | (8.78 | )% | (56.88 | )% | ||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 41.23 | (11.61 | ) | (30.95 | ) | (4.57 | ) | (20.86 | ) | (8.15 | ) | (54.10 | ) | |||||||||||||||||
Market Price Return | 41.23 | (11.56 | ) | (30.82 | ) | (4.49 | ) | (20.50 | ) | (8.14 | ) | (54.07 | ) |
Fund Inception: March 3, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.84%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund and Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
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PUW | Manager’s Analysis | |
PowerShares WilderHill Progressive Energy Portfolio (PUW) |
As an index fund, the PowerShares WilderHill Progressive Energy Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the WilderHill Progressive Energy Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies engaged principally in the progressive energy business that comprise the Index.
Progressive Energy Index LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes companies in the Index pursuant to a proprietary selection methodology. The Index is a modified equal-weighted index composed of companies in transitional energy technologies that improve the use of fossil fuels and nuclear power. The Index Provider includes companies focused on the following areas in the Index: alternative energy; better efficiency; emission reduction; new energy activity; utilities; and energy conversion and storage. To be eligible for the Index, a stock must have: (i) three-month average market capitalization of at least $150 million; (ii) three-month average closing price above $1.00 if not currently in the Index; and (iii) a listing on the NYSE, NYSE MKT or the NASDAQ and, if a foreign company, have its ADRs listed on the NYSE, NYSE MKT or the NASDAQ. Components less than $400 million in market capitalization are set to one-half of a percent (0.5%) weight at the rebalance. No single stock may exceed 5% of the total Index weight at the quarterly rebalancing. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 20.21%. On a net asset value (“NAV”) basis, the Fund returned 20.24%. During the same time period, the Index returned 21.10%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the consumer discretionary and materials sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Andersons, Inc. (The), a food distributors company (portfolio average weight of 2.25%) and Acuity Brands, Inc., an electrical equipment company (portfolio average weight of 2.08%). Positions that detracted most significantly from the Fund’s return included Westport Innovations, Inc., a machinery company (portfolio average weight of 1.78%); and Nuverra Environmental Solutions, Inc., an electrical equipment, instruments & components company (portfolio average weight of 1.7%).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Oil, Gas & Consumable Fuels | 20.4 | |||
Electrical Equipment | 16.0 | |||
Machinery | 12.5 | |||
Construction & Engineering | 6.8 | |||
Chemicals | 6.6 | |||
Electric Utilities | 6.4 | |||
Auto Components | 5.5 | |||
Building Products | 4.9 | |||
Industrial Conglomerates | 3.3 | |||
Energy Equipment & Services | 3.1 | |||
Automobiles | 3.0 | |||
Commercial Services & Supplies | 2.2 | |||
Household Products | 2.0 | |||
Food & Staples Retailing | 2.0 | |||
Electronic Equipment, Instruments & Components | 1.8 | |||
Aerospace & Defense | 1.6 | |||
Semiconductors & Semiconductor Equipment | 1.5 | |||
Real Estate Investment Trusts | 0.4 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.0 |
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Centrais Eletricas Brasileiras SA ADR | 2.4 | |||
Companhia Energetica de Minas Gerais ADR | 2.1 | |||
Rentech, Inc. | 2.1 | |||
Chesapeake Energy Corp. | 2.0 | |||
Cosan Ltd., Class A | 2.0 | |||
Remy International, Inc. | 2.0 | |||
Energizer Holdings, Inc. | 2.0 | |||
Andersons, Inc. (The) | 2.0 | |||
Southwestern Energy Co. | 2.0 | |||
NRG Yield, Inc., Class A | 2.0 | |||
Total | 20.6 |
| 22 |
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PowerShares WilderHill Progressive Energy Portfolio (PUW) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
WilderHill Progressive Energy Index | 21.10 | % | 4.17 | % | 13.04 | % | 15.52 | % | 105.74 | % | 5.30 | % | 47.40 | % | ||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 20.24 | 3.21 | 9.95 | 14.47 | 96.55 | 4.41 | 38.30 | |||||||||||||||||||||||
Market Price Return | 20.21 | 3.17 | 9.81 | 14.46 | 96.43 | 4.41 | 38.27 |
Fund Inception: October 24, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.87%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund and Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
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PowerShares Aerospace & Defense Portfolio (PPA)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Aerospace & Defense—78.9% | ||||||||
14,787 | AAR Corp. | $ | 382,983 | |||||
8,515 | Aerovironment, Inc.(b) | 287,552 | ||||||
11,893 | Alliant Techsystems, Inc. | 1,715,208 | ||||||
2,938 | American Science & Engineering, Inc. | 197,434 | ||||||
51,082 | Boeing Co. (The) | 6,590,600 | ||||||
10,009 | Cubic Corp. | 474,727 | ||||||
28,187 | DigitalGlobe, Inc.(b) | 839,409 | ||||||
4,050 | Ducommun, Inc.(b) | 98,293 | ||||||
6,481 | Engility Holdings, Inc.(b) | 282,831 | ||||||
11,888 | Esterline Technologies Corp.(b) | 1,296,030 | ||||||
70,823 | Exelis, Inc. | 1,313,058 | ||||||
22,904 | GenCorp, Inc.(b) | 402,194 | ||||||
47,354 | General Dynamics Corp. | 5,182,895 | ||||||
24,813 | HEICO Corp. | 1,372,655 | ||||||
36,625 | Hexcel Corp.(b) | 1,526,896 | ||||||
68,533 | Honeywell International, Inc. | 6,366,716 | ||||||
18,418 | Huntington Ingalls Industries, Inc. | 1,897,054 | ||||||
13,925 | KEYW Holding Corp. (The)(b) | 178,936 | ||||||
21,457 | Kratos Defense & Security Solutions, Inc.(b) | 154,920 | ||||||
32,319 | L-3 Communications Holdings, Inc. | 3,728,643 | ||||||
4,798 | LMI Aerospace, Inc.(b) | 65,445 | ||||||
39,454 | Lockheed Martin Corp. | 6,475,980 | ||||||
16,974 | Moog, Inc., Class A(b) | 1,110,948 | ||||||
36,272 | Northrop Grumman Corp. | 4,407,411 | ||||||
22,627 | Orbital Sciences Corp.(b) | 665,234 | ||||||
19,987 | Precision Castparts Corp. | 5,058,510 | ||||||
45,175 | Raytheon Co. | 4,313,309 | ||||||
49,055 | Rockwell Collins, Inc. | 3,809,121 | ||||||
3,784 | Sparton Corp.(b) | 102,773 | ||||||
19,385 | TASER International, Inc.(b) | 313,068 | ||||||
14,056 | Teledyne Technologies, Inc.(b) | 1,305,240 | ||||||
101,225 | Textron, Inc. | 4,140,102 | ||||||
19,719 | TransDigm Group, Inc. | 3,507,418 | ||||||
19,605 | Triumph Group, Inc. | 1,270,600 | ||||||
54,993 | United Technologies Corp. | 6,507,322 | ||||||
|
| |||||||
77,341,515 | ||||||||
|
| |||||||
Communications Equipment—4.3% | ||||||||
5,728 | Comtech Telecommunications Corp. | 181,864 | ||||||
39,911 | Harris Corp. | 2,934,257 | ||||||
17,224 | ViaSat, Inc.(b) | 1,105,953 | ||||||
|
| |||||||
4,222,074 | ||||||||
|
| |||||||
Construction & Engineering—1.3% | ||||||||
26,957 | URS Corp. | 1,270,214 | ||||||
|
| |||||||
Containers & Packaging—3.0% | ||||||||
52,553 | Ball Corp. | 2,952,953 | ||||||
|
| |||||||
Diversified Telecommunication Services—0.7% | ||||||||
39,392 | Intelsat SA (United Kingdom)(b) | 716,147 | ||||||
|
| |||||||
Electronic Equipment, Instruments & Components—2.4% | ||||||||
52,646 | FLIR Systems, Inc. | 1,792,070 | ||||||
12,426 | Mercury Systems, Inc.(b) | 173,467 | ||||||
7,449 | OSI Systems, Inc.(b) | 415,728 | ||||||
|
| |||||||
2,381,265 | ||||||||
|
| |||||||
IT Services—7.6% | ||||||||
55,675 | Booz Allen Hamilton Holding Corp. | 1,293,887 | ||||||
8,769 | CACI International, Inc., Class A(b) | 610,761 |
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
IT Services (continued) | ||||||||
54,445 | Computer Sciences Corp. | $ | 3,222,055 | |||||
31,999 | Leidos Holdings, Inc. | 1,191,643 | ||||||
13,843 | ManTech International Corp., Class A | 412,936 | ||||||
18,316 | Science Applications International Corp. | 714,324 | ||||||
|
| |||||||
7,445,606 | ||||||||
|
| |||||||
Machinery—1.8% | ||||||||
31,441 | Oshkosh Corp. | 1,745,290 | ||||||
|
| |||||||
Total Common Stocks (Cost $81,293,306) | 98,075,064 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
74,614 | Invesco Premier Portfolio—Institutional Class(c) (Cost $74,614) | 74,614 | ||||||
|
| |||||||
Total Investments (Cost $81,367,920)—100.1% | 98,149,678 | |||||||
Other assets less liabilities—(0.1)% | (63,451 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 98,086,227 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 24 |
|
Schedule of Investments(a)
PowerShares CleantechTM Portfolio (PZD)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Aerospace & Defense—2.3% | ||||||||
45,435 | Hexcel Corp.(b) | $ | 1,894,185 | |||||
|
| |||||||
Auto Components—6.1% | ||||||||
42,744 | BorgWarner, Inc. | 2,656,112 | ||||||
55,922 | Johnson Controls, Inc. | 2,524,319 | ||||||
|
| |||||||
5,180,431 | ||||||||
|
| |||||||
Building Products—2.2% | ||||||||
83,625 | Kingspan Group PLC (Ireland) | 1,572,864 | ||||||
13,293 | WaterFurnace Renewable Energy, Inc. (Canada) | 277,985 | ||||||
|
| |||||||
1,850,849 | ||||||||
|
| |||||||
Chemicals—9.3% | ||||||||
527 | Gurit Holding AG (Switzerland)(b) | 275,037 | ||||||
38,125 | Koninklijke DSM NV (Netherlands) | 2,731,918 | ||||||
60,232 | Novozymes A/S, Class B (Denmark) | 2,883,456 | ||||||
39,769 | Umicore SA (Belgium) | 1,947,879 | ||||||
|
| |||||||
7,838,290 | ||||||||
|
| |||||||
Commercial Services & Supplies—3.5% | ||||||||
26,097 | Ceco Environmental Corp. | 414,681 | ||||||
30,987 | Mix Telematics Ltd. ADR (South Africa)(b) | 325,364 | ||||||
31,663 | Tetra Tech, Inc.(b) | 907,778 | ||||||
96,347 | Tomra Systems ASA (Norway) | 893,735 | ||||||
434,000 | United Envirotech Ltd. (Singapore) | 451,165 | ||||||
|
| |||||||
2,992,723 | ||||||||
|
| |||||||
Construction & Engineering—2.8% | ||||||||
31,716 | Aegion Corp.(b) | 808,441 | ||||||
48,722 | Ameresco, Inc., Class A(b) | 312,308 | ||||||
33,983 | Arcadis NV (Netherlands) | 1,205,306 | ||||||
|
| |||||||
2,326,055 | ||||||||
|
| |||||||
Electrical Equipment—17.4% | ||||||||
103,340 | ABB Ltd. (Switzerland)(b) | 2,481,240 | ||||||
22,449 | EnerSys | 1,517,103 | ||||||
108,900 | Gamesa Corp. Tecnologica SA (Spain)(b) | 1,079,767 | ||||||
25,515 | Polypore International, Inc.(b)(c) | 884,860 | ||||||
20,103 | PowerSecure International, Inc.(b) | 446,890 | ||||||
21,899 | Saft Groupe SA (France) | 778,230 | ||||||
28,697 | Schneider Electric SA (France) | 2,687,801 | ||||||
34,885 | SGL Carbon SE (Germany)(c) | 1,160,874 | ||||||
20,978 | Vacon Oyj (Finland) | 870,866 | ||||||
63,757 | Vestas Wind Systems A/S (Denmark)(b) | 2,828,354 | ||||||
|
| |||||||
14,735,985 | ||||||||
|
| |||||||
Electronic Equipment, Instruments & Components—9.4% | ||||||||
10,978 | Badger Meter, Inc. | 543,960 | ||||||
127,595 | Corning, Inc. | 2,668,012 | ||||||
24,796 | HORIBA Ltd. (Japan) | 855,662 | ||||||
25,335 | Itron, Inc.(b) | 962,730 | ||||||
264,025 | Opus Group AB (Sweden)(c) | 516,552 | ||||||
62,969 | Trimble Navigation Ltd.(b) | 2,419,899 | ||||||
|
| |||||||
7,966,815 | ||||||||
|
| |||||||
Independent Power Producers & Energy Traders—2.1% | ||||||||
9,132,508 | Energy Development Corp. (Philippines) | 1,145,148 | ||||||
22,316 | Ormat Technologies, Inc. (Israel) | 595,391 | ||||||
|
| |||||||
1,740,539 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrial Conglomerates—7.1% | ||||||||
26,703 | Raven Industries, Inc. | $ | 825,123 | |||||
18,984 | Roper Industries, Inc. | 2,637,827 | ||||||
19,123 | Siemens AG (Germany) | 2,518,923 | ||||||
|
| |||||||
5,981,873 | ||||||||
|
| |||||||
Life Sciences Tools & Services—2.2% | ||||||||
6,715 | Eurofins Scientific (France) | 1,862,135 | ||||||
|
| |||||||
Machinery—16.2% | ||||||||
96,372 | Alfa Laval AB (Sweden)(c) | 2,550,932 | ||||||
22,385 | CLARCOR, Inc. | 1,292,958 | ||||||
46,684 | Donaldson Co., Inc. | 1,964,930 | ||||||
11,875 | Kadant, Inc. | 412,656 | ||||||
9,554 | Lindsay Corp.(c) | 841,994 | ||||||
58,808 | Meyer Burger Technology AG (Switzerland)(b)(c) | 724,705 | ||||||
27,219 | Pall Corp. | 2,290,479 | ||||||
17,247 | Westport Innovations, Inc. (Canada)(b)(c) | 225,832 | ||||||
30,623 | Woodward, Inc. | 1,372,829 | ||||||
53,772 | Xylem, Inc. | 2,021,289 | ||||||
|
| |||||||
13,698,604 | ||||||||
|
| |||||||
Professional Services—6.4% | ||||||||
46,317 | Intertek Group PLC (United Kingdom) | 2,272,742 | ||||||
21,499 | Mistras Group, Inc.(b) | 488,242 | ||||||
1,062 | SGS SA (Switzerland) | 2,647,612 | ||||||
|
| |||||||
5,408,596 | ||||||||
|
| |||||||
Semiconductors & Semiconductor Equipment—5.8% | ||||||||
32,062 | Advanced Energy Industries, Inc.(b) | 701,517 | ||||||
38,959 | Cree, Inc.(b) | 1,837,696 | ||||||
65,854 | GT Advanced Technologies, Inc.(b)(c) | 1,093,835 | ||||||
17,040 | Power Integrations, Inc. | 804,799 | ||||||
11,848 | SMA Solar Technology AG (Germany)(c) | 495,217 | ||||||
|
| |||||||
4,933,064 | ||||||||
|
| |||||||
Software—7.2% | ||||||||
30,876 | ANSYS, Inc.(b) | 2,356,148 | ||||||
51,417 | Autodesk, Inc.(b) | 2,469,044 | ||||||
25,972 | FleetMatics Group PLC(b) | 779,939 | ||||||
31,138 | Silver Spring Networks, Inc.(b)(c) | 466,447 | ||||||
|
| |||||||
6,071,578 | ||||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $60,314,257)—100.0% | 84,481,722 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—7.2% | ||||||||
6,110,040 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $6,110,040) | 6,110,040 | ||||||
|
| |||||||
Total Investments (Cost $66,424,297)—107.2% | 90,591,762 | |||||||
Other assets less liabilities—(7.2)% | (6,056,344 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 84,535,418 | ||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 25 |
|
PowerShares CleantechTM Portfolio (PZD) (continued)
April 30, 2014
Investment Abbreviations:
ADR—American Depositary Receipt
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2I. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Citibank | $ | 5,994,327 | $ | (5,994,327 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 26 |
|
Schedule of Investments(a)
PowerShares DWA Momentum Portfolio (PDP)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Consumer Discretionary—29.5% | ||||||||
20,511 | Amazon.com, Inc.(b) | $ | 6,238,010 | |||||
12,949 | AutoZone, Inc.(b) | 6,913,342 | ||||||
162,024 | Brinker International, Inc. | 7,961,859 | ||||||
213,871 | CBS Corp., Class B | 12,353,189 | ||||||
31,301 | Chipotle Mexican Grill, Inc.(b) | 15,603,548 | ||||||
155,402 | Dollar Tree, Inc.(b) | 8,091,782 | ||||||
291,317 | Domino’s Pizza, Inc. | 21,668,158 | ||||||
103,862 | Hanesbrands, Inc. | 8,526,032 | ||||||
124,095 | Jarden Corp.(b) | 7,092,029 | ||||||
310,849 | Liberty Interactive Corp., Class A(b) | 9,033,272 | ||||||
116,854 | Macy’s, Inc. | 6,710,925 | ||||||
24,791 | Netflix, Inc.(b) | 7,983,694 | ||||||
194,280 | NIKE, Inc., Class B | 14,172,726 | ||||||
208,669 | O’Reilly Automotive, Inc.(b) | 31,047,860 | ||||||
76,576 | Polaris Industries, Inc. | 10,286,454 | ||||||
28,216 | Priceline Group, Inc. (The)(b) | 32,667,074 | ||||||
340,528 | Service Corp. International | 6,391,711 | ||||||
110,281 | Signet Jewelers Ltd. | 11,173,671 | ||||||
92,506 | Starbucks Corp. | 6,532,774 | ||||||
1,085,822 | Starz, Class A(b) | 35,039,476 | ||||||
46,671 | Tesla Motors, Inc.(b) | 9,702,434 | ||||||
110,242 | TJX Cos., Inc. (The) | 6,413,880 | ||||||
169,234 | Tractor Supply Co. | 11,379,294 | ||||||
350,042 | TRW Automotive Holdings Corp.(b) | 28,125,875 | ||||||
199,084 | Under Armour, Inc., Class A(b) | 9,733,217 | ||||||
245,779 | VF Corp. | 15,014,639 | ||||||
251,009 | Wyndham Worldwide Corp. | 17,906,982 | ||||||
37,325 | Wynn Resorts Ltd. | 7,610,194 | ||||||
|
| |||||||
371,374,101 | ||||||||
|
| |||||||
Consumer Staples—2.3% | ||||||||
98,616 | Brown-Forman Corp., Class B | 8,847,827 | ||||||
158,161 | Hormel Foods Corp. | 7,542,698 | ||||||
66,146 | Keurig Green Mountain, Inc. | 6,196,557 | ||||||
98,357 | Monster Beverage Corp.(b) | 6,585,985 | ||||||
|
| |||||||
29,173,067 | ||||||||
|
| |||||||
Energy—4.9% | ||||||||
252,066 | Cheniere Energy, Inc.(b) | 14,229,126 | ||||||
54,803 | Continental Resources, Inc.(b) | 7,591,312 | ||||||
126,278 | EQT Corp. | 13,763,039 | ||||||
264,496 | ONEOK, Inc. | 16,721,437 | ||||||
50,231 | Pioneer Natural Resources Co. | 9,708,145 | ||||||
|
| |||||||
62,013,059 | ||||||||
|
| |||||||
Financials—4.5% | ||||||||
73,959 | ACE Ltd. | 7,567,485 | ||||||
34,263 | Affiliated Managers Group, Inc.(b) | 6,790,927 | ||||||
60,071 | Ameriprise Financial, Inc. | 6,705,726 | ||||||
354,086 | Arch Capital Group Ltd.(b) | 20,296,209 | ||||||
118,183 | Discover Financial Services | 6,606,430 | ||||||
184,511 | HCC Insurance Holdings, Inc. | 8,476,435 | ||||||
|
| |||||||
56,443,212 | ||||||||
|
| |||||||
Health Care—17.1% | ||||||||
48,987 | Actavis PLC(b) | 10,009,514 | ||||||
195,456 | Alexion Pharmaceuticals, Inc.(b) | 30,921,139 | ||||||
23,033 | Biogen Idec, Inc.(b) | 6,613,235 |
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Health Care (continued) | ||||||||
127,197 | Cerner Corp.(b) | $ | 6,525,206 | |||||
79,095 | Cigna Corp. | 6,330,764 | ||||||
55,738 | Cooper Cos., Inc. (The) | 7,352,400 | ||||||
455,237 | Gilead Sciences, Inc.(b) | 35,731,552 | ||||||
201,673 | Henry Schein, Inc.(b) | 23,037,107 | ||||||
44,409 | Illumina, Inc.(b) | 6,032,963 | ||||||
275,065 | Jazz Pharmaceuticals PLC(b) | 37,106,268 | ||||||
40,308 | McKesson Corp. | 6,819,710 | ||||||
28,496 | Mettler-Toledo International, Inc.(b) | 6,642,988 | ||||||
138,253 | Mylan, Inc.(b) | 7,020,487 | ||||||
87,945 | Regeneron Pharmaceuticals, Inc.(b) | 26,109,991 | ||||||
|
| |||||||
216,253,324 | ||||||||
|
| |||||||
Industrials—18.2% | ||||||||
97,633 | Alaska Air Group, Inc. | 9,185,313 | ||||||
110,162 | B/E Aerospace, Inc.(b) | 9,668,919 | ||||||
125,333 | Chicago Bridge & Iron Co. NV | 10,035,413 | ||||||
106,474 | Colfax Corp.(b) | 7,663,999 | ||||||
123,358 | Danaher Corp. | 9,052,010 | ||||||
107,920 | IDEX Corp. | 8,047,594 | ||||||
159,600 | Kirby Corp.(b) | 16,058,952 | ||||||
78,867 | Lockheed Martin Corp. | 12,945,229 | ||||||
122,114 | Nordson Corp. | 9,079,176 | ||||||
129,961 | Old Dominion Freight Line, Inc.(b) | 7,879,535 | ||||||
74,284 | Pall Corp. | 6,250,999 | ||||||
97,336 | Pentair Ltd. | 7,231,092 | ||||||
96,176 | Precision Castparts Corp. | 24,341,184 | ||||||
128,932 | Roper Industries, Inc. | 17,915,101 | ||||||
58,453 | Snap-On, Inc. | 6,780,548 | ||||||
40,676 | TransDigm Group, Inc. | 7,235,040 | ||||||
72,340 | Union Pacific Corp. | 13,775,706 | ||||||
200,239 | United Rentals, Inc.(b) | 18,788,425 | ||||||
68,960 | WABCO Holdings, Inc.(b) | 7,379,410 | ||||||
448,586 | Waste Connections, Inc. | 20,033,851 | ||||||
|
| |||||||
229,347,496 | ||||||||
|
| |||||||
Information Technology—9.0% | ||||||||
26,555 | Alliance Data Systems Corp.(b) | 6,423,654 | ||||||
136,953 | Amphenol Corp., Class A | 13,058,468 | ||||||
68,107 | Apple, Inc. | 40,189,260 | ||||||
131,928 | Fiserv, Inc.(b) | 8,018,584 | ||||||
118,075 | Gartner, Inc.(b) | 8,140,090 | ||||||
292,960 | MasterCard, Inc., Class A | 21,547,208 | ||||||
110,544 | NetSuite, Inc.(b) | 8,546,157 | ||||||
191,733 | Skyworks Solutions, Inc.(b) | 7,870,640 | ||||||
|
| |||||||
113,794,061 | ||||||||
|
| |||||||
Materials—13.4% | ||||||||
257,832 | Airgas, Inc. | 27,397,228 | ||||||
385,124 | Ball Corp. | 21,640,118 | ||||||
74,300 | Ecolab, Inc. | 7,774,752 | ||||||
217,786 | FMC Corp. | 16,769,522 | ||||||
73,337 | International Flavors & Fragrances, Inc. | 7,225,161 | ||||||
146,075 | International Paper Co. | 6,814,399 | ||||||
25,341 | NewMarket Corp. | 9,434,961 | ||||||
150,016 | Rockwood Holdings, Inc. | 10,658,637 | ||||||
159,474 | RPM International, Inc. | 6,803,161 | ||||||
74,911 | Sherwin-Williams Co. (The) | 14,970,214 | ||||||
110,086 | Sigma-Aldrich Corp. | 10,591,374 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 27 |
|
PowerShares DWA Momentum Portfolio (PDP) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Materials (continued) | ||||||||
237,533 | W.R. Grace & Co.(b) | $ | 21,876,789 | |||||
101,757 | Westlake Chemical Corp. | 7,245,099 | ||||||
|
| |||||||
169,201,415 | ||||||||
|
| |||||||
Telecommunication Services—0.5% | ||||||||
201,598 | T-Mobile US, Inc. (Germany)(b) | 5,904,805 | ||||||
|
| |||||||
Utilities—0.6% | ||||||||
73,190 | Sempra Energy | 7,217,266 | ||||||
|
| |||||||
Total Common Stocks (Cost $1,036,795,226) | 1,260,721,806 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
614,538 | Invesco Premier Portfolio—Institutional Class(c) (Cost $614,538) | 614,538 | ||||||
|
| |||||||
Total Investments (Cost $1,037,409,764)—100.1% | 1,261,336,344 | |||||||
Other assets less liabilities—(0.1)% | (892,801 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 1,260,443,543 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 28 |
|
Schedule of Investments(a)
PowerShares Global Listed Private Equity Portfolio (PSP)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—90.7% | ||||||||
Capital Markets—52.3% | ||||||||
4,281,063 | 3i Group PLC (United Kingdom) | $ | 27,454,945 | |||||
165,160 | Alaris Royalty Corp. (Canada)(b) | 4,025,723 | ||||||
301,308 | Altamir (France) | 4,562,139 | ||||||
912,650 | American Capital Ltd.(c) | 13,680,624 | ||||||
613,450 | Apollo Global Management LLC, Class A | 16,642,899 | ||||||
727,071 | Apollo Investment Corp. | 5,809,297 | ||||||
1,031,163 | Ares Capital Corp. | 17,705,069 | ||||||
192,067 | Aurelius AG (Germany) | 7,126,464 | ||||||
259,914 | BlackRock Kelso Capital Corp. | 2,360,019 | ||||||
2,471,721 | Brait SE (South Africa)(c) | 13,300,772 | ||||||
688,775 | Bure Equity AB (Sweden) | 3,033,320 | ||||||
50,442 | Capital Southwest Corp. | 1,770,514 | ||||||
456,356 | Carlyle Group LP (The) | 14,639,900 | ||||||
102,591 | Deutsche Beteiligungs AG (Germany) | 2,759,601 | ||||||
475,984 | Fifth Street Finance Corp. | 4,431,411 | ||||||
171,540 | Gimv NV (Belgium) | 8,888,403 | ||||||
163,333 | Golub Capital BDC, Inc.(b) | 2,730,928 | ||||||
1,423,398 | GP Investments Ltd. (Brazil)(c) | 2,356,461 | ||||||
220,110 | Hercules Technology Growth Capital, Inc.(b) | 3,011,105 | ||||||
110,738 | ICG Group, Inc.(c) | 2,256,840 | ||||||
2,530,530 | Intermediate Capital Group PLC (United Kingdom) | 18,954,705 | ||||||
2,574,370 | IP Group PLC (United Kingdom)(c) | 7,476,759 | ||||||
385,479 | JAFCO Co. Ltd. (Japan) | 14,736,128 | ||||||
134,854 | Main Street Capital Corp.(b) | 4,239,810 | ||||||
249,627 | MCG Capital Corp. | 838,747 | ||||||
173,274 | Medley Capital Corp.(b) | 2,259,493 | ||||||
86,637 | MVC Capital, Inc. | 1,129,746 | ||||||
181,913 | New Mountain Finance Corp. | 2,603,175 | ||||||
104,830 | Partners Group Holding AG (Switzerland) | 28,670,639 | ||||||
244,643 | PennantPark Investment Corp. | 2,617,680 | ||||||
518,305 | Princess Private Equity Holding Ltd. (Switzerland) | 4,599,394 | ||||||
1,097,260 | Prospect Capital Corp.(b) | 11,861,381 | ||||||
2,168,685 | Ratos AB, Class B (Sweden) | 21,980,028 | ||||||
83,362 | Safeguard Scientifics, Inc.(c) | 1,751,436 | ||||||
163,093 | Solar Capital Ltd. | 3,571,737 | ||||||
1,074,854 | SVG Capital PLC (United Kingdom)(c) | 7,713,516 | ||||||
5,754,711 | Symphony International Holdings Ltd. (Singapore) | 4,373,580 | ||||||
144,103 | TCP Capital Corp. | 2,333,028 | ||||||
212,231 | TICC Capital Corp.(b) | 2,043,785 | ||||||
103,570 | Triangle Capital Corp.(b) | 2,700,070 | ||||||
|
| |||||||
305,001,271 | ||||||||
|
| |||||||
Diversified Financial Services—25.4% | ||||||||
120,962 | Ackermans & van Haaren NV (Belgium) | 15,631,481 | ||||||
1,828,551 | Better Capital PCC Ltd. (United Kingdom)(c) | 3,427,236 | ||||||
2,019,070 | China Merchants China Direct Investments Ltd. (China) | 2,625,128 | ||||||
183,261 | Compass Diversified Holdings | 3,388,496 | ||||||
271,155 | Electra Private Equity PLC (United Kingdom)(c) | 12,224,831 | ||||||
276,255 | Eurazeo SA (France) | 23,258,257 | ||||||
259,439 | HgCapital Trust PLC (United Kingdom) | 4,538,465 | ||||||
408,103 | JZ Capital Partners Ltd. (Guernsey) | 3,018,269 | ||||||
882,658 | Leucadia National Corp. | 22,525,432 | ||||||
573,162 | Onex Corp. (Canada) | 32,693,919 | ||||||
70,152 | PICO Holdings, Inc.(c) | 1,631,034 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Diversified Financial Services (continued) | ||||||||
156,012 | Wendel (France) | $ | 23,481,351 | |||||
|
| |||||||
148,443,899 | ||||||||
|
| |||||||
Food Products—1.2% | ||||||||
128,001 | A/S Schouw & Co. (Denmark) | 7,133,558 | ||||||
|
| |||||||
Industrial Conglomerates—1.1% | ||||||||
461,137 | Hosken Consolidated Investments Ltd. (South Africa) | 6,568,186 | ||||||
|
| |||||||
Internet Software & Services—2.6% | ||||||||
226,435 | IAC/InterActiveCorp. | 15,008,112 | ||||||
|
| |||||||
Machinery—4.6% | ||||||||
5,595,562 | Melrose Industries PLC (United Kingdom) | 26,975,147 | ||||||
|
| |||||||
Metals & Mining—3.5% | ||||||||
16,668,359 | Fosun International Ltd. (China) | 20,166,675 | ||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $450,063,527) | 529,296,848 | |||||||
|
| |||||||
Money Market Funds—9.6% | ||||||||
2,230,000 | Invesco Liquid Assets Portfolio—Institutional Share Class(d)(e) | 2,230,000 | ||||||
53,783,158 | Invesco Premier Portfolio—Institutional Class(d) | 53,783,158 | ||||||
|
| |||||||
Total Money Market Funds (Cost 56,013,158) | 56,013,158 | |||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $506,076,685)—100.3% | 585,310,006 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—4.0% | ||||||||
23,404,087 | Invesco Liquid Assets Portfolio—Institutional Class(d)(f) (Cost $23,404,087) | 23,404,087 | ||||||
|
| |||||||
Total Investments (Cost $529,480,772)—104.3% | 608,714,093 | |||||||
Other assets less liabilities—(4.3)% | (25,112,827 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 583,601,266 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | All or a portion of this security was out on loan at April 30, 2014. |
(c) | Non-income producing security. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | All or a portion of the value was pledged as collateral for swap agreements. See Note 2H and Note 6. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 29 |
|
PowerShares Global Listed Private Equity Portfolio (PSP) (continued)
April 30, 2014
(f) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2I. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brother Harriman | $ | 22,883,255 | $ | (22,883,255 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
This Fund has holdings greater than 10% of net assets in the following country:
United Kingdom | 18.6 | % |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 30 |
|
Schedule of Investments
PowerShares Golden Dragon China Portfolio (PGJ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—99.9% | ||||||||
British Virgin Islands—0.5% | ||||||||
191,216 | Shanda Games Ltd. ADR(a) | $ | 1,265,850 | |||||
|
| |||||||
Canada—2.2% | ||||||||
166,581 | Canadian Solar, Inc.(a)(b) | 4,517,677 | ||||||
528,976 | Silvercorp Metals, Inc.(b) | 1,100,270 | ||||||
|
| |||||||
5,617,947 | ||||||||
|
| |||||||
China—95.4% | ||||||||
136,107 | 21Vianet Group, Inc. ADR(a) | 3,269,290 | ||||||
35,937 | 51job, Inc. ADR(a) | 2,423,591 | ||||||
39,155 | 58.Com, Inc. ADR(a)(b) | 1,557,586 | ||||||
91,307 | AutoNavi Holdings Ltd. ADR(a) | 1,888,229 | ||||||
140,931 | Baidu, Inc. ADR(a) | 21,682,234 | ||||||
75,214 | Bitauto Holdings Ltd. ADR(a) | 2,694,918 | ||||||
61,808 | Bona FILM Group Ltd. ADR(a)(b) | 357,868 | ||||||
37,712 | Changyou.com Ltd. ADR(a)(b) | 1,057,067 | ||||||
86,814 | China Automotive Systems, Inc.(a) | 652,841 | ||||||
79,230 | China Biologic Products, Inc.(a) | 2,895,856 | ||||||
36,692 | China Distance Education Holdings Ltd. ADR | 552,948 | ||||||
56,202 | China Finance Online Co. Ltd. ADR(a)(b) | 209,071 | ||||||
98,527 | China Green Agriculture, Inc.(a)(b) | 271,935 | ||||||
83,604 | China Information Technology, Inc.(a)(b) | 339,432 | ||||||
31,250 | China Life Insurance Co. Ltd. ADR | 1,221,250 | ||||||
84,666 | China Lodging Group Ltd. ADR(a) | 1,878,739 | ||||||
274,533 | China Ming Yang Wind Power Group Ltd. ADR(a)(b) | 639,662 | ||||||
26,164 | China Mobile Games & Entertainment Group Ltd. ADR(a)(b) | 445,573 | ||||||
253,303 | China Mobile Ltd. ADR | 12,014,161 | ||||||
36,578 | China Petroleum & Chemical Corp. ADR | 3,250,687 | ||||||
20,026 | China Telecom Corp. Ltd. ADR | 1,025,732 | ||||||
114,706 | China Unicom (Hong Kong) Ltd. ADR(b) | 1,758,443 | ||||||
148,181 | China XD Plastics Co. Ltd.(a)(b) | 1,013,558 | ||||||
44,354 | ChinaCache International Holdings Ltd. ADR(a) | 612,085 | ||||||
108,801 | CNinsure, Inc. ADR(a) | 691,974 | ||||||
24,869 | CNOOC Ltd. ADR | 4,108,110 | ||||||
58,949 | Concord Medical Services Holdings Ltd. ADR | 408,517 | ||||||
445,970 | Ctrip.com International Ltd. ADR(a) | 20,844,638 | ||||||
170,662 | E-Commerce China Dangdang, Inc., Class A ADR(a)(b) | 1,841,443 | ||||||
237,848 | E-House China Holdings Ltd. ADR(b) | 2,069,278 | ||||||
470,171 | Giant Interactive Group, Inc. ADR | 5,524,509 | ||||||
178,168 | Hollysys Automation Technologies Ltd.(a) | 3,814,577 | ||||||
113,061 | Home Inns & Hotels Management, Inc. ADR(a)(b) | 3,213,194 | ||||||
15,773 | Huaneng Power International, Inc. ADR(b) | 619,563 | ||||||
142,267 | ISoftStone Holdings Ltd. ADR(a)(b) | 776,778 | ||||||
106,384 | JA Solar Holdings Co. Ltd. ADR(a)(b) | 1,024,478 | ||||||
56,408 | JinkoSolar Holding Co. Ltd. ADR(a)(b) | 1,517,375 | ||||||
50,814 | Jinpan International Ltd. | 374,499 | ||||||
123,695 | Kandi Technologies Group, Inc.(a)(b) | 1,386,621 | ||||||
83,926 | KongZhong Corp. ADR(a) | 852,688 | ||||||
92,609 | Lihua International, Inc.(a) | 196,331 | ||||||
276,163 | Mindray Medical International Ltd. ADR(b) | 9,129,949 | ||||||
85,126 | Montage Technology Group, Ltd.(a)(b) | 1,769,770 | ||||||
140,229 | Nam Tai Property, Inc. | 968,982 | ||||||
225,241 | NetEase, Inc. ADR | 15,336,660 | ||||||
431,396 | New Oriental Education & Technology Group, Inc. ADR | 10,439,783 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
China (continued) | ||||||||
50,518 | Noah Holdings Ltd. ADR(b) | $ | 679,972 | |||||
151,819 | NQ Mobile, Inc. ADR(a)(b) | 1,876,483 | ||||||
137,297 | Perfect World Co. Ltd. ADR | 2,553,724 | ||||||
35,102 | PetroChina Co. Ltd. ADR | 4,047,963 | ||||||
104,947 | Phoenix New Media Ltd. ADR(a)(b) | 970,760 | ||||||
219,761 | Qihoo 360 Technology Co. Ltd. ADR(a) | 18,543,433 | ||||||
39,552 | Qunar Cayman Islands Ltd. ADR(a)(b) | 976,934 | ||||||
242,852 | ReneSola Ltd. ADR(a)(b) | 660,557 | ||||||
353,482 | Renren, Inc. ADR(a) | 1,162,956 | ||||||
77,158 | Semiconductor Manufacturing International Corp. ADR(a) | 320,206 | ||||||
203,774 | SINA Corp.(a) | 9,740,397 | ||||||
26,179 | Sino Clean Energy, Inc.(a) | 0 | ||||||
171,504 | Sinovac Biotech Ltd.(a)(b) | 1,018,734 | ||||||
118,898 | Sohu.com, Inc.(a)(b) | 6,559,603 | ||||||
531,433 | SouFun Holdings Ltd. ADR | 6,254,966 | ||||||
119,950 | TAL Education Group ADR(a) | 2,653,294 | ||||||
199,378 | Trina Solar Ltd. ADR(a)(b) | 2,229,046 | ||||||
91,716 | Vipshop Holdings Ltd. ADR(a)(b) | 12,857,666 | ||||||
217,511 | WuXi PharmaTech Cayman, Inc. ADR(a) | 7,395,374 | ||||||
135,807 | Xinyuan Real Estate Co. Ltd. ADR(b) | 555,451 | ||||||
69,410 | Xueda Education Group ADR | 346,356 | ||||||
320,678 | Yingli Green Energy Holding Co. Ltd. ADR(a)(b) | 1,096,719 | ||||||
362,937 | Youku Tudou, Inc. ADR(a) | 8,089,866 | ||||||
96,521 | YY, Inc. ADR(a)(b) | 5,536,445 | ||||||
|
| |||||||
246,749,378 | ||||||||
|
| |||||||
South Korea—0.1% | ||||||||
153,924 | Hanwha SolarOne Co. Ltd. ADR(a)(b) | 400,202 | ||||||
|
| |||||||
United States—1.7% | ||||||||
130,398 | China HGS Real Estate, Inc.(a)(b) | 684,589 | ||||||
188,535 | China Recycling Energy Corp.(a)(b) | 586,344 | ||||||
115,364 | China Yuchai International Ltd. | 2,323,431 | ||||||
37,591 | eLong, Inc. ADR(a)(b) | 567,248 | ||||||
200,689 | Kingold Jewelry, Inc.(a) | 222,765 | ||||||
|
| |||||||
4,384,377 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $232,344,587) | 258,417,754 | |||||||
|
| |||||||
Money Market Fund—0.2% | ||||||||
461,509 | Invesco Premier Portfolio—Institutional Class(c) (Cost $461,509) | 461,509 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $232,806,096)—100.1% | 258,879,263 | |||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 31 |
|
PowerShares Golden Dragon China Portfolio (PGJ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—16.7% | ||||||||
43,026,256 | Invesco Liquid Assets Portfolio—Institutional Class(c)(d) (Cost $43,026,256) | $ | 43,026,256 | |||||
|
| |||||||
Total Investments (Cost $275,832,352)—116.8% | 301,905,519 | |||||||
Other assets less liabilities—(16.8)% | (43,336,945 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 258,568,574 | ||||||
|
|
Investment Abbreviations:
ADR—American Depositary Receipt
Notes to Schedule of Investments:
(a) | Non-income producing security. |
(b) | All or a portion of this security was out on loan at April 30, 2014. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(d) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2I. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Citibank | $ | 41,317,489 | $ | (41,317,489 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 32 |
|
Schedule of Investments(a)
PowerShares S&P 500 BuyWrite Portfolio (PBP)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b)—101.4% | ||||||||
Consumer Discretionary—12.0% | ||||||||
5,601 | Amazon.com, Inc.(c) | $ | 1,703,432 | |||||
949 | AutoNation, Inc.(c) | 50,288 | ||||||
507 | AutoZone, Inc.(c) | 270,682 | ||||||
3,206 | Bed Bath & Beyond, Inc.(c) | 199,189 | ||||||
4,115 | Best Buy Co., Inc. | 106,702 | ||||||
3,432 | BorgWarner, Inc. | 213,264 | ||||||
3,224 | Cablevision Systems Corp., Class A | 53,841 | ||||||
3,361 | CarMax, Inc.(c) | 147,145 | ||||||
6,598 | Carnival Corp. | 259,367 | ||||||
8,308 | CBS Corp., Class B | 479,870 | ||||||
467 | Chipotle Mexican Grill, Inc.(c) | 232,799 | ||||||
4,179 | Coach, Inc. | 186,592 | ||||||
39,242 | Comcast Corp., Class A | 2,031,166 | ||||||
4,287 | D.R. Horton, Inc. | 95,514 | ||||||
1,974 | Darden Restaurants, Inc. | 98,128 | ||||||
4,198 | Delphi Automotive PLC (United Kingdom) | 280,594 | ||||||
7,133 | DIRECTV(c) | 553,521 | ||||||
3,345 | Discovery Communications, Inc., Class A(c) | 253,885 | ||||||
4,436 | Dollar General Corp.(c) | 250,368 | ||||||
3,130 | Dollar Tree, Inc.(c) | 162,979 | ||||||
1,538 | Expedia, Inc. | 109,183 | ||||||
1,437 | Family Dollar Stores, Inc. | 84,424 | ||||||
59,376 | Ford Motor Co. | 958,922 | ||||||
723 | Fossil Group, Inc.(c) | 77,108 | ||||||
1,742 | GameStop Corp., Class A | 69,123 | ||||||
3,423 | Gannett Co., Inc. | 93,003 | ||||||
3,988 | Gap, Inc. (The) | 156,728 | ||||||
1,849 | Garmin Ltd. | 105,578 | ||||||
19,627 | General Motors Co.(c) | 676,739 | ||||||
2,312 | Genuine Parts Co. | 201,421 | ||||||
4,150 | Goodyear Tire & Rubber Co. (The) | 104,580 | ||||||
66 | Graham Holdings Co., Class B | 44,301 | ||||||
4,128 | H&R Block, Inc. | 117,318 | ||||||
3,313 | Harley-Davidson, Inc. | 244,963 | ||||||
1,019 | Harman International Industries, Inc. | 111,693 | ||||||
1,753 | Hasbro, Inc. | 96,871 | ||||||
21,201 | Home Depot, Inc. (The) | 1,685,692 | ||||||
3,714 | International Game Technology | 46,611 | ||||||
6,384 | Interpublic Group of Cos., Inc. (The) | 111,209 | ||||||
9,997 | Johnson Controls, Inc. | 451,265 | ||||||
3,031 | Kohl’s Corp. | 166,068 | ||||||
3,671 | L Brands, Inc. | 198,968 | ||||||
2,089 | Leggett & Platt, Inc. | 68,645 | ||||||
2,644 | Lennar Corp., Class A | 102,032 | ||||||
15,745 | Lowe’s Cos., Inc. | 722,853 | ||||||
5,548 | Macy’s, Inc. | 318,622 | ||||||
3,329 | Marriott International, Inc., Class A | 192,849 | ||||||
5,124 | Mattel, Inc. | 200,938 | ||||||
14,903 | McDonald’s Corp. | 1,510,866 | ||||||
2,698 | Michael Kors Holdings Ltd.(c) | 246,058 | ||||||
918 | Mohawk Industries, Inc.(c) | 121,552 | ||||||
899 | Netflix, Inc.(c) | 289,514 | ||||||
4,199 | Newell Rubbermaid, Inc. | 126,432 | ||||||
7,497 | News Corp., Class A(c) | 127,599 | ||||||
11,198 | NIKE, Inc., Class B | 816,894 | ||||||
2,152 | Nordstrom, Inc. | 131,875 | ||||||
3,887 | Omnicom Group, Inc. | 263,072 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Consumer Discretionary (continued) | ||||||||
1,600 | O’Reilly Automotive, Inc.(c) | $ | 238,064 | |||||
1,560 | PetSmart, Inc. | 105,581 | ||||||
784 | Priceline Group, Inc. (The)(c) | 907,676 | ||||||
5,167 | PulteGroup, Inc. | 95,021 | ||||||
1,228 | PVH Corp. | 154,200 | ||||||
889 | Ralph Lauren Corp. | 134,568 | ||||||
3,236 | Ross Stores, Inc. | 220,307 | ||||||
1,650 | Scripps Networks Interactive, Inc., Class A | 123,865 | ||||||
9,797 | Staples, Inc. | 122,462 | ||||||
11,380 | Starbucks Corp. | 803,656 | ||||||
2,886 | Starwood Hotels & Resorts Worldwide, Inc. | 221,212 | ||||||
9,516 | Target Corp. | 587,613 | ||||||
1,656 | Tiffany & Co. | 144,883 | ||||||
4,177 | Time Warner Cable, Inc. | 590,878 | ||||||
13,439 | Time Warner, Inc. | 893,156 | ||||||
10,707 | TJX Cos., Inc. (The) | 622,933 | ||||||
2,099 | Tractor Supply Co. | 141,137 | ||||||
1,668 | TripAdvisor, Inc.(c) | 134,674 | ||||||
29,220 | Twenty-First Century Fox, Inc., Class A | 935,624 | ||||||
2,391 | Under Armour, Inc., Class A(c) | 116,896 | ||||||
1,639 | Urban Outfitters, Inc.(c) | 58,439 | ||||||
5,304 | VF Corp. | 324,021 | ||||||
6,000 | Viacom, Inc., Class B | 509,880 | ||||||
24,531 | Walt Disney Co. (The) | 1,946,290 | ||||||
1,165 | Whirlpool Corp. | 178,688 | ||||||
1,927 | Wyndham Worldwide Corp. | 137,472 | ||||||
1,218 | Wynn Resorts Ltd. | 248,338 | ||||||
6,668 | Yum! Brands, Inc. | 513,369 | ||||||
|
| |||||||
29,991,798 | ||||||||
|
| |||||||
Consumer Staples—9.9% | ||||||||
30,003 | Altria Group, Inc. | 1,203,420 | ||||||
9,912 | Archer-Daniels-Midland Co. | 433,452 | ||||||
6,533 | Avon Products, Inc. | 99,824 | ||||||
2,438 | Brown-Forman Corp., Class B | 218,737 | ||||||
2,690 | Campbell Soup Co. | 122,368 | ||||||
1,954 | Clorox Co. (The) | 177,228 | ||||||
57,046 | Coca-Cola Co. (The) | 2,326,906 | ||||||
3,578 | Coca-Cola Enterprises, Inc. | 162,584 | ||||||
13,143 | Colgate-Palmolive Co. | 884,524 | ||||||
6,329 | ConAgra Foods, Inc. | 193,098 | ||||||
2,515 | Constellation Brands, Inc., Class A(c) | 200,798 | ||||||
6,620 | Costco Wholesale Corp. | 765,802 | ||||||
17,802 | CVS Caremark Corp. | 1,294,561 | ||||||
2,967 | Dr Pepper Snapple Group, Inc. | 164,431 | ||||||
3,848 | Estee Lauder Cos., Inc. (The), Class A | 279,249 | ||||||
9,403 | General Mills, Inc. | 498,547 | ||||||
2,255 | Hershey Co. (The) | 217,021 | ||||||
2,025 | Hormel Foods Corp. | 96,572 | ||||||
1,559 | J.M. Smucker Co. (The) | 150,724 | ||||||
3,866 | Kellogg Co. | 258,365 | ||||||
1,942 | Keurig Green Mountain, Inc. | 181,927 | ||||||
5,712 | Kimberly-Clark Corp. | 641,172 | ||||||
8,978 | Kraft Foods Group, Inc. | 510,489 | ||||||
7,776 | Kroger Co. (The) | 358,007 | ||||||
5,453 | Lorillard, Inc. | 324,017 | ||||||
1,973 | McCormick & Co., Inc., | 140,478 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 33 |
|
PowerShares S&P 500 BuyWrite Portfolio (PBP) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Consumer Staples (continued) | ||||||||
3,033 | Mead Johnson Nutrition Co. | $ | 267,693 | |||||
2,381 | Molson Coors Brewing Co., Class B | 142,789 | ||||||
25,609 | Mondelez International, Inc., Class A | 912,961 | ||||||
2,033 | Monster Beverage Corp.(c) | 136,130 | ||||||
22,921 | PepsiCo, Inc. | 1,968,685 | ||||||
23,866 | Philip Morris International, Inc. | 2,038,872 | ||||||
40,821 | Procter & Gamble Co. (The) | 3,369,773 | ||||||
4,689 | Reynolds American, Inc. | 264,600 | ||||||
3,464 | Safeway, Inc. | 117,984 | ||||||
8,807 | Sysco Corp. | 320,839 | ||||||
4,047 | Tyson Foods, Inc., Class A | 169,853 | ||||||
13,161 | Walgreen Co. | 893,632 | ||||||
24,358 | Wal-Mart Stores, Inc. | 1,941,576 | ||||||
5,600 | Whole Foods Market, Inc. | 278,320 | ||||||
|
| |||||||
24,728,008 | ||||||||
|
| |||||||
Energy—10.8% | ||||||||
7,584 | Anadarko Petroleum Corp. | 750,968 | ||||||
5,943 | Apache Corp. | 515,852 | ||||||
6,582 | Baker Hughes, Inc. | 460,082 | ||||||
6,357 | Cabot Oil & Gas Corp. | 249,703 | ||||||
3,264 | Cameron International Corp.(c) | 212,029 | ||||||
7,623 | Chesapeake Energy Corp. | 219,161 | ||||||
28,743 | Chevron Corp. | 3,607,821 | ||||||
18,459 | ConocoPhillips | 1,371,688 | ||||||
3,450 | CONSOL Energy, Inc. | 153,560 | ||||||
5,359 | Denbury Resources, Inc. | 90,138 | ||||||
5,766 | Devon Energy Corp. | 403,620 | ||||||
1,045 | Diamond Offshore Drilling, Inc. | 57,067 | ||||||
3,516 | Ensco PLC, Class A | 177,382 | ||||||
8,224 | EOG Resources, Inc. | 805,952 | ||||||
2,269 | EQT Corp. | 247,298 | ||||||
65,058 | Exxon Mobil Corp. | 6,662,590 | ||||||
3,553 | FMC Technologies, Inc.(c) | 201,455 | ||||||
12,810 | Halliburton Co. | 807,927 | ||||||
1,617 | Helmerich & Payne, Inc. | 175,687 | ||||||
4,114 | Hess Corp. | 366,804 | ||||||
10,086 | Kinder Morgan, Inc. | 329,409 | ||||||
10,493 | Marathon Oil Corp. | 379,322 | ||||||
4,435 | Marathon Petroleum Corp. | 412,233 | ||||||
2,590 | Murphy Oil Corp. | 164,284 | ||||||
3,928 | Nabors Industries Ltd. | 100,243 | ||||||
6,452 | National Oilwell Varco, Inc. | 506,676 | ||||||
2,050 | Newfield Exploration Co.(c) | 69,393 | ||||||
3,826 | Noble Corp. PLC | 117,879 | ||||||
5,419 | Noble Energy, Inc. | 388,976 | ||||||
11,965 | Occidental Petroleum Corp. | 1,145,649 | ||||||
3,129 | ONEOK, Inc. | 197,815 | ||||||
4,084 | Peabody Energy Corp. | 77,637 | ||||||
8,847 | Phillips 66 | 736,247 | ||||||
2,149 | Pioneer Natural Resources Co. | 415,337 | ||||||
2,697 | QEP Resources, Inc. | 82,771 | ||||||
2,462 | Range Resources Corp. | 222,688 | ||||||
1,869 | Rowan Cos. PLC, Class A(c) | 57,789 | ||||||
19,682 | Schlumberger Ltd. | 1,998,707 | ||||||
5,313 | Southwestern Energy Co.(c) | 254,386 | ||||||
10,090 | Spectra Energy Corp. | 400,674 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Energy (continued) | ||||||||
1,982 | Tesoro Corp. | $ | 111,567 | |||||
5,109 | Transocean Ltd. | 220,045 | ||||||
8,017 | Valero Energy Corp. | 458,332 | ||||||
10,304 | Williams Cos., Inc. (The) | 434,520 | ||||||
|
| |||||||
26,819,363 | ||||||||
|
| |||||||
Financials—16.3% | ||||||||
5,068 | ACE Ltd. | 518,558 | ||||||
6,862 | Aflac, Inc. | 430,385 | ||||||
6,731 | Allstate Corp. (The) | 383,330 | ||||||
13,758 | American Express Co. | 1,202,862 | ||||||
22,042 | American International Group, Inc. | 1,171,091 | ||||||
5,947 | American Tower Corp. REIT | 496,693 | ||||||
2,871 | Ameriprise Financial, Inc. | 320,490 | ||||||
4,533 | Aon PLC (United Kingdom) | 384,761 | ||||||
2,197 | Apartment Investment & Management Co., Class A REIT | 67,733 | ||||||
1,077 | Assurant, Inc. | 72,601 | ||||||
1,830 | AvalonBay Communities, Inc. REIT | 249,886 | ||||||
159,107 | Bank of America Corp. | 2,408,880 | ||||||
17,089 | Bank of New York Mellon Corp. (The) | 578,804 | ||||||
10,703 | BB&T Corp. | 399,543 | ||||||
27,102 | Berkshire Hathaway, Inc., Class B(c) | 3,492,093 | ||||||
1,889 | BlackRock, Inc. | 568,589 | ||||||
2,301 | Boston Properties, Inc. REIT | 269,539 | ||||||
8,624 | Capital One Financial Corp. | 637,314 | ||||||
4,198 | CBRE Group, Inc., Class A(c) | 111,835 | ||||||
17,595 | Charles Schwab Corp. (The) | 467,147 | ||||||
3,698 | Chubb Corp. (The) | 340,512 | ||||||
2,213 | Cincinnati Financial Corp. | 107,862 | ||||||
45,715 | Citigroup, Inc. | 2,190,206 | ||||||
4,751 | CME Group, Inc. | 334,423 | ||||||
2,738 | Comerica, Inc. | 132,081 | ||||||
5,029 | Crown Castle International Corp. REIT | 365,759 | ||||||
7,089 | Discover Financial Services | 396,275 | ||||||
4,340 | E*TRADE Financial Corp.(c) | 97,433 | ||||||
5,056 | Equity Residential REIT | 300,529 | ||||||
926 | Essex Property Trust, Inc. REIT | 160,439 | ||||||
12,819 | Fifth Third Bancorp | 264,200 | ||||||
6,078 | Franklin Resources, Inc. | 318,183 | ||||||
7,849 | General Growth Properties, Inc. REIT | 180,292 | ||||||
7,458 | Genworth Financial, Inc., Class A(c) | 133,125 | ||||||
6,339 | Goldman Sachs Group, Inc. (The) | 1,013,099 | ||||||
6,720 | Hartford Financial Services Group, Inc. (The) | 241,046 | ||||||
6,883 | HCP, Inc. REIT | 288,122 | ||||||
4,366 | Health Care REIT, Inc. | 275,451 | ||||||
11,393 | Host Hotels & Resorts, Inc. REIT | 244,380 | ||||||
7,160 | Hudson City Bancorp, Inc. | 71,314 | ||||||
12,514 | Huntington Bancshares, Inc. | 114,628 | ||||||
1,729 | IntercontinentalExchange Group, Inc. | 353,477 | ||||||
6,448 | Invesco Ltd.(d) | 227,034 | ||||||
57,012 | JPMorgan Chase & Co. | 3,191,532 | ||||||
13,390 | KeyCorp | 182,640 | ||||||
6,169 | Kimco Realty Corp. REIT | 141,393 | ||||||
1,576 | Legg Mason, Inc. | 73,899 | ||||||
4,715 | Leucadia National Corp. | 120,327 | ||||||
3,970 | Lincoln National Corp. | 192,585 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 34 |
|
PowerShares S&P 500 BuyWrite Portfolio (PBP) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Financials (continued) | ||||||||
4,608 | Loews Corp. | $ | 202,614 | |||||
1,971 | M&T Bank Corp. | 240,482 | ||||||
2,114 | Macerich Co. (The) REIT | 137,220 | ||||||
8,256 | Marsh & McLennan Cos., Inc. | 407,103 | ||||||
4,080 | McGraw-Hill Financial, Inc. | 301,634 | ||||||
16,915 | MetLife, Inc. | 885,500 | ||||||
2,828 | Moody’s Corp. | 221,998 | ||||||
21,119 | Morgan Stanley | 653,211 | ||||||
1,758 | NASDAQ OMX Group, Inc. (The) | 64,870 | ||||||
6,454 | Navient Corp. when-issued | 106,426 | ||||||
3,355 | Northern Trust Corp. | 202,139 | ||||||
4,671 | People’s United Financial, Inc. | 66,702 | ||||||
2,663 | Plum Creek Timber Co., Inc. REIT | 116,107 | ||||||
8,041 | PNC Financial Services Group, Inc. | 675,766 | ||||||
4,138 | Principal Financial Group, Inc. | 193,824 | ||||||
8,245 | Progressive Corp. (The) | 199,941 | ||||||
7,522 | Prologis, Inc. REIT | 305,619 | ||||||
6,971 | Prudential Financial, Inc. | 562,420 | ||||||
2,174 | Public Storage REIT | 381,559 | ||||||
21,372 | Regions Financial Corp. | 216,712 | ||||||
4,731 | Simon Property Group, Inc. REIT | 819,409 | ||||||
6,498 | State Street Corp. | 419,511 | ||||||
8,050 | SunTrust Banks, Inc. | 307,993 | ||||||
3,946 | T. Rowe Price Group, Inc. | 324,085 | ||||||
1,332 | Torchmark Corp. | 106,160 | ||||||
5,304 | Travelers Cos., Inc. (The) | 480,436 | ||||||
27,439 | U.S. Bancorp | 1,118,962 | ||||||
3,906 | Unum Group | 129,757 | ||||||
4,431 | Ventas, Inc. REIT | 292,800 | ||||||
2,619 | Vornado Realty Trust REIT | 268,709 | ||||||
72,089 | Wells Fargo & Co. | 3,578,498 | ||||||
8,801 | Weyerhaeuser Co. REIT | 262,710 | ||||||
4,156 | XL Group PLC | 130,291 | ||||||
2,780 | Zions Bancorp. | 80,398 | ||||||
|
| |||||||
40,745,946 | ||||||||
|
| |||||||
Health Care—13.4% | ||||||||
23,231 | Abbott Laboratories | 899,969 | ||||||
23,916 | AbbVie, Inc. | 1,245,545 | ||||||
2,620 | Actavis PLC(c) | 535,345 | ||||||
5,461 | Aetna, Inc. | 390,188 | ||||||
5,020 | Agilent Technologies, Inc. | 271,281 | ||||||
2,975 | Alexion Pharmaceuticals, Inc.(c) | 470,645 | ||||||
4,494 | Allergan, Inc. | 745,285 | ||||||
3,451 | AmerisourceBergen Corp. | 224,936 | ||||||
11,367 | Amgen, Inc. | 1,270,262 | ||||||
8,178 | Baxter International, Inc. | 595,277 | ||||||
2,903 | Becton, Dickinson and Co. | 328,126 | ||||||
3,559 | Biogen Idec, Inc.(c) | 1,021,860 | ||||||
19,936 | Boston Scientific Corp.(c) | 251,393 | ||||||
24,752 | Bristol-Myers Squibb Co. | 1,239,828 | ||||||
1,167 | C.R. Bard, Inc. | 160,264 | ||||||
5,162 | Cardinal Health, Inc. | 358,811 | ||||||
3,134 | CareFusion Corp.(c) | 122,414 | ||||||
6,113 | Celgene Corp.(c) | 898,672 | ||||||
4,453 | Cerner Corp.(c) | 228,439 | ||||||
4,119 | Cigna Corp. | 329,685 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Health Care (continued) | ||||||||
6,786 | Covidien PLC | $ | 483,503 | |||||
2,661 | DaVita HealthCare Partners, Inc.(c) | 184,407 | ||||||
2,133 | DENTSPLY International, Inc. | 95,196 | ||||||
1,613 | Edwards Lifesciences Corp.(c) | 131,411 | ||||||
14,835 | Eli Lilly & Co. | 876,749 | ||||||
11,683 | Express Scripts Holding Co.(c) | 777,854 | ||||||
3,587 | Forest Laboratories, Inc.(c) | 329,681 | ||||||
23,159 | Gilead Sciences, Inc.(c) | 1,817,750 | ||||||
2,503 | Hospira, Inc.(c) | 114,637 | ||||||
2,317 | Humana, Inc. | 254,291 | ||||||
574 | Intuitive Surgical, Inc.(c) | 207,616 | ||||||
42,590 | Johnson & Johnson | 4,313,941 | ||||||
1,283 | Laboratory Corp. of America Holdings(c) | 126,632 | ||||||
3,465 | McKesson Corp. | 586,243 | ||||||
15,068 | Medtronic, Inc. | 886,300 | ||||||
44,272 | Merck & Co., Inc. | 2,592,568 | ||||||
5,599 | Mylan, Inc.(c) | 284,317 | ||||||
1,235 | Patterson Cos., Inc. | 50,265 | ||||||
1,697 | PerkinElmer, Inc. | 71,223 | ||||||
2,011 | Perrigo Co. PLC | 291,313 | ||||||
96,097 | Pfizer, Inc. | 3,005,914 | ||||||
2,170 | Quest Diagnostics, Inc. | 121,368 | ||||||
1,184 | Regeneron Pharmaceuticals, Inc.(c) | 351,518 | ||||||
4,273 | St. Jude Medical, Inc. | 271,207 | ||||||
4,437 | Stryker Corp. | 344,977 | ||||||
1,459 | Tenet Healthcare Corp.(c) | 65,772 | ||||||
5,899 | Thermo Fisher Scientific, Inc. | 672,486 | ||||||
14,893 | UnitedHealth Group, Inc. | 1,117,571 | ||||||
1,557 | Varian Medical Systems, Inc.(c) | 123,859 | ||||||
3,550 | Vertex Pharmaceuticals, Inc.(c) | 240,335 | ||||||
1,281 | Waters Corp.(c) | 126,230 | ||||||
4,253 | WellPoint, Inc. | 428,192 | ||||||
2,546 | Zimmer Holdings, Inc. | 246,453 | ||||||
7,528 | Zoetis, Inc. | 227,797 | ||||||
|
| |||||||
33,407,801 | ||||||||
|
| |||||||
Industrials—10.9% | ||||||||
9,478 | 3M Co. | 1,318,295 | ||||||
2,757 | ADT Corp. (The) | 83,372 | ||||||
1,350 | Allegion PLC | 66,623 | ||||||
3,690 | AMETEK, Inc. | 194,537 | ||||||
10,297 | Boeing Co. (The) | 1,328,519 | ||||||
2,233 | C.H. Robinson Worldwide, Inc. | 131,524 | ||||||
9,603 | Caterpillar, Inc. | 1,012,156 | ||||||
1,514 | Cintas Corp. | 89,220 | ||||||
15,170 | CSX Corp. | 428,097 | ||||||
2,611 | Cummins, Inc. | 393,869 | ||||||
9,044 | Danaher Corp. | 663,649 | ||||||
5,566 | Deere & Co. | 519,530 | ||||||
12,788 | Delta Air Lines, Inc. | 470,982 | ||||||
2,557 | Dover Corp. | 220,925 | ||||||
565 | Dun & Bradstreet Corp. (The) | 62,579 | ||||||
7,156 | Eaton Corp. PLC | 519,812 | ||||||
10,584 | Emerson Electric Co. | 721,617 | ||||||
1,835 | Equifax, Inc. | 129,936 | ||||||
3,048 | Expeditors International of Washington, Inc. | 125,700 | ||||||
4,111 | Fastenal Co. | 205,879 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 35 |
|
PowerShares S&P 500 BuyWrite Portfolio (PBP) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Industrials (continued) | ||||||||
4,182 | FedEx Corp. | $ | 569,797 | |||||
2,069 | Flowserve Corp. | 151,140 | ||||||
2,412 | Fluor Corp. | 182,588 | ||||||
4,895 | General Dynamics Corp. | 535,758 | ||||||
151,052 | General Electric Co. | 4,061,788 | ||||||
11,805 | Honeywell International, Inc. | 1,096,684 | ||||||
5,885 | Illinois Tool Works, Inc. | 501,579 | ||||||
3,893 | Ingersoll-Rand PLC | 232,801 | ||||||
2,563 | Iron Mountain, Inc. | 72,892 | ||||||
1,984 | Jacobs Engineering Group, Inc.(c) | 114,477 | ||||||
1,506 | Joy Global, Inc. | 90,932 | ||||||
1,658 | Kansas City Southern | 167,259 | ||||||
1,291 | L-3 Communications Holdings, Inc. | 148,943 | ||||||
4,065 | Lockheed Martin Corp. | 667,229 | ||||||
5,366 | Masco Corp. | 107,803 | ||||||
4,278 | Nielsen Holdings NV | 200,852 | ||||||
4,663 | Norfolk Southern Corp. | 440,793 | ||||||
3,260 | Northrop Grumman Corp. | 396,123 | ||||||
5,334 | PACCAR, Inc. | 341,269 | ||||||
1,651 | Pall Corp. | 138,932 | ||||||
2,243 | Parker Hannifin Corp. | 284,592 | ||||||
2,968 | Pentair Ltd. | 220,493 | ||||||
3,046 | Pitney Bowes, Inc. | 81,633 | ||||||
2,184 | Precision Castparts Corp. | 552,749 | ||||||
3,275 | Quanta Services, Inc.(c) | 115,542 | ||||||
4,735 | Raytheon Co. | 452,098 | ||||||
4,072 | Republic Services, Inc. | 142,886 | ||||||
2,067 | Robert Half International, Inc. | 92,602 | ||||||
2,087 | Rockwell Automation, Inc. | 248,729 | ||||||
2,033 | Rockwell Collins, Inc. | 157,862 | ||||||
1,497 | Roper Industries, Inc. | 208,008 | ||||||
803 | Ryder System, Inc. | 65,991 | ||||||
874 | Snap-On, Inc. | 101,384 | ||||||
10,569 | Southwest Airlines Co. | 255,453 | ||||||
2,340 | Stanley Black & Decker, Inc. | 200,983 | ||||||
1,281 | Stericycle, Inc.(c) | 149,160 | ||||||
4,253 | Textron, Inc. | 173,948 | ||||||
6,930 | Tyco International Ltd. | 283,437 | ||||||
6,851 | Union Pacific Corp. | 1,304,636 | ||||||
10,699 | United Parcel Service, Inc., Class B | 1,053,851 | ||||||
12,677 | United Technologies Corp. | 1,500,069 | ||||||
921 | W.W. Grainger, Inc. | 234,302 | ||||||
6,508 | Waste Management, Inc. | 289,281 | ||||||
2,777 | Xylem, Inc. | 104,387 | ||||||
|
| |||||||
27,180,536 | ||||||||
|
| |||||||
Information Technology—18.8% | ||||||||
9,590 | Accenture PLC, Class A | 769,310 | ||||||
6,993 | Adobe Systems, Inc.(c) | 431,398 | ||||||
2,685 | Akamai Technologies, Inc.(c) | 142,493 | ||||||
800 | Alliance Data Systems Corp.(c) | 193,520 | ||||||
4,781 | Altera Corp. | 155,478 | ||||||
2,379 | Amphenol Corp., Class A | 226,838 | ||||||
4,705 | Analog Devices, Inc. | 241,319 | ||||||
13,429 | Apple, Inc. | 7,924,319 | ||||||
18,233 | Applied Materials, Inc. | 347,521 | ||||||
3,417 | Autodesk, Inc.(c) | 164,084 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Information Technology (continued) | ||||||||
7,254 | Automatic Data Processing, Inc. | $ | 565,522 | |||||
8,310 | Broadcom Corp., Class A | 256,031 | ||||||
4,854 | CA, Inc. | 146,300 | ||||||
77,554 | Cisco Systems, Inc. | 1,792,273 | ||||||
2,764 | Citrix Systems, Inc.(c) | 163,933 | ||||||
9,145 | Cognizant Technology Solutions Corp., Class A(c) | 438,091 | ||||||
2,191 | Computer Sciences Corp. | 129,663 | ||||||
20,959 | Corning, Inc. | 438,253 | ||||||
17,542 | eBay, Inc.(c) | 909,202 | ||||||
4,661 | Electronic Arts, Inc.(c) | 131,906 | ||||||
30,497 | EMC Corp. | 786,823 | ||||||
1,018 | F5 Networks, Inc.(c) | 107,063 | ||||||
25,719 | Facebook, Inc., Class A(c) | 1,537,482 | ||||||
4,376 | Fidelity National Information Services, Inc. | 233,810 | ||||||
1,063 | First Solar, Inc.(c) | 71,742 | ||||||
3,831 | Fiserv, Inc.(c) | 232,848 | ||||||
2,119 | FLIR Systems, Inc. | 72,131 | ||||||
4,250 | Google, Inc., Class A(c) | 2,273,240 | ||||||
4,250 | Google, Inc., Class C(c) | 2,238,305 | ||||||
1,606 | Harris Corp. | 118,073 | ||||||
28,532 | Hewlett-Packard Co. | 943,268 | ||||||
74,855 | Intel Corp. | 1,997,880 | ||||||
14,737 | International Business Machines Corp. | 2,895,378 | ||||||
4,265 | Intuit, Inc. | 323,074 | ||||||
2,822 | Jabil Circuit, Inc. | 48,708 | ||||||
7,126 | Juniper Networks, Inc.(c) | 175,941 | ||||||
2,505 | KLA-Tencor Corp. | 160,295 | ||||||
2,441 | Lam Research Corp.(c) | 140,626 | ||||||
3,552 | Linear Technology Corp. | 158,064 | ||||||
8,406 | LSI Corp. | 93,643 | ||||||
15,363 | MasterCard, Inc., Class A | 1,129,949 | ||||||
2,995 | Microchip Technology, Inc. | 142,382 | ||||||
15,972 | Micron Technology, Inc.(c) | 417,189 | ||||||
113,723 | Microsoft Corp. | 4,594,409 | ||||||
3,402 | Motorola Solutions, Inc. | 216,299 | ||||||
4,987 | NetApp, Inc. | 177,587 | ||||||
8,344 | NVIDIA Corp. | 154,114 | ||||||
52,137 | Oracle Corp. | 2,131,361 | ||||||
4,880 | Paychex, Inc. | 204,033 | ||||||
25,460 | QUALCOMM, Inc. | 2,003,957 | ||||||
2,851 | Red Hat, Inc.(c) | 138,701 | ||||||
8,450 | Salesforce.com, Inc.(c) | 436,442 | ||||||
3,395 | SanDisk Corp. | 288,473 | ||||||
4,950 | Seagate Technology PLC | 260,271 | ||||||
10,412 | Symantec Corp. | 211,155 | ||||||
6,176 | TE Connectivity Ltd. (Switzerland) | 364,260 | ||||||
2,394 | Teradata Corp.(c) | 108,831 | ||||||
16,323 | Texas Instruments, Inc. | 741,880 | ||||||
2,486 | Total System Services, Inc. | 78,980 | ||||||
1,890 | VeriSign, Inc.(c) | 89,170 | ||||||
7,631 | Visa, Inc., Class A | 1,546,117 | ||||||
3,166 | Western Digital Corp. | 279,020 | ||||||
8,249 | Western Union Co. (The) | 130,912 | ||||||
16,769 | Xerox Corp. | 202,737 | ||||||
4,018 | Xilinx, Inc. | 189,609 | ||||||
14,133 | Yahoo!, Inc.(c) | 508,081 | ||||||
|
| |||||||
46,921,767 | ||||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 36 |
|
PowerShares S&P 500 BuyWrite Portfolio (PBP) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Materials—3.6% | ||||||||
3,187 | Air Products & Chemicals, Inc. | $ | 374,536 | |||||
1,001 | Airgas, Inc. | 106,366 | ||||||
17,631 | Alcoa, Inc. | 237,490 | ||||||
1,623 | Allegheny Technologies, Inc. | 66,868 | ||||||
1,444 | Avery Dennison Corp. | 70,265 | ||||||
2,114 | Ball Corp. | 118,786 | ||||||
1,530 | Bemis Co., Inc. | 61,567 | ||||||
834 | CF Industries Holdings, Inc. | 204,472 | ||||||
18,305 | Dow Chemical Co. (The) | 913,419 | ||||||
13,957 | E.I. du Pont de Nemours & Co. | 939,585 | ||||||
2,293 | Eastman Chemical Co. | 199,881 | ||||||
4,075 | Ecolab, Inc. | 426,408 | ||||||
1,999 | FMC Corp. | 153,923 | ||||||
15,634 | Freeport-McMoRan Copper & Gold, Inc. | 537,341 | ||||||
1,222 | International Flavors & Fragrances, Inc. | 120,391 | ||||||
6,606 | International Paper Co. | 308,170 | ||||||
6,501 | LyondellBasell Industries NV, Class A | 601,342 | ||||||
2,625 | MeadWestvaco Corp. | 102,559 | ||||||
7,902 | Monsanto Co. | 874,751 | ||||||
5,104 | Mosaic Co. (The) | 255,404 | ||||||
7,496 | Newmont Mining Corp. | 186,126 | ||||||
4,793 | Nucor Corp. | 248,038 | ||||||
2,478 | Owens-Illinois, Inc.(c) | 78,751 | ||||||
2,083 | PPG Industries, Inc. | 403,310 | ||||||
4,426 | Praxair, Inc. | 577,814 | ||||||
2,951 | Sealed Air Corp. | 101,249 | ||||||
1,282 | Sherwin-Williams Co. (The) | 256,195 | ||||||
1,797 | Sigma-Aldrich Corp. | 172,889 | ||||||
2,176 | United States Steel Corp. | 56,620 | ||||||
1,964 | Vulcan Materials Co. | 126,737 | ||||||
|
| |||||||
8,881,253 | ||||||||
|
| |||||||
Telecommunication Services—2.5% | ||||||||
78,391 | AT&T, Inc. | 2,798,559 | ||||||
8,701 | CenturyLink, Inc. | 303,752 | ||||||
15,049 | Frontier Communications Corp. | 89,541 | ||||||
62,346 | Verizon Communications, Inc. | 2,913,429 | ||||||
8,973 | Windstream Holdings, Inc. | 81,385 | ||||||
|
| |||||||
6,186,666 | ||||||||
|
| |||||||
Utilities—3.2% | ||||||||
9,918 | AES Corp. (The) | 143,315 | ||||||
1,788 | AGL Resources, Inc. | 96,552 | ||||||
3,653 | Ameren Corp. | 150,905 | ||||||
7,344 | American Electric Power Co., Inc. | 395,181 | ||||||
6,456 | CenterPoint Energy, Inc. | 159,850 | ||||||
4,016 | CMS Energy Corp. | 121,725 | ||||||
4,410 | Consolidated Edison, Inc. | 255,912 | ||||||
8,754 | Dominion Resources, Inc. | 635,015 | ||||||
2,663 | DTE Energy Co. | 208,087 | ||||||
10,636 | Duke Energy Corp. | 792,276 | ||||||
4,905 | Edison International | 277,427 | ||||||
2,685 | Entergy Corp. | 194,662 | ||||||
12,909 | Exelon Corp. | 452,202 | ||||||
6,304 | FirstEnergy Corp. | 212,760 | ||||||
1,203 | Integrys Energy Group, Inc. | 73,720 | ||||||
6,555 | NextEra Energy, Inc. | 654,517 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests(b) (continued) | ||||||||
Utilities (continued) | ||||||||
4,727 | NiSource, Inc. | $ | 171,685 | |||||
4,749 | Northeast Utilities | 224,438 | ||||||
4,896 | NRG Energy, Inc. | 160,197 | ||||||
3,772 | Pepco Holdings, Inc. | 100,939 | ||||||
6,890 | PG&E Corp. | 314,046 | ||||||
1,657 | Pinnacle West Capital Corp. | 92,709 | ||||||
9,496 | PPL Corp. | 316,597 | ||||||
7,620 | Public Service Enterprise Group, Inc. | 312,191 | ||||||
2,123 | SCANA Corp. | 113,963 | ||||||
3,422 | Sempra Energy | 337,443 | ||||||
13,368 | Southern Co. (The) | 612,655 | ||||||
3,083 | TECO Energy, Inc. | 55,371 | ||||||
3,402 | Wisconsin Energy Corp. | 164,929 | ||||||
7,502 | Xcel Energy, Inc. | 239,089 | ||||||
|
| |||||||
8,040,358 | ||||||||
|
| |||||||
Total Investments (Cost $200,613,440)—101.4% | 252,903,496 | |||||||
Other assets less liabilities—(1.4)% | (3,445,071 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 249,458,425 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | A portion of the securities in the portfolio are subject to call options written. In addition, the unrealized appreciation (depreciation) of the call options written was based on Level 1 inputs. See Note 2G and Note 6. |
(c) | Non-income producing security. |
(d) | Affiliated company. The Fund’s Adviser is a wholly-owned subsidiary of Invesco Ltd. and therefore, Invesco Ltd. is considered to be affiliated. See Note 4. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 37 |
|
Schedule of Investments(a)
PowerShares S&P 500® High Quality Portfolio (SPHQ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—19.3% | ||||||||
29,409 | Comcast Corp., Class A | $ | 1,522,210 | |||||
57,613 | Darden Restaurants, Inc. | 2,863,942 | ||||||
74,721 | Family Dollar Stores, Inc. | 4,389,859 | ||||||
72,486 | Gap, Inc. (The) | 2,848,700 | ||||||
33,324 | Genuine Parts Co. | 2,903,187 | ||||||
21,371 | Harley-Davidson, Inc. | 1,580,172 | ||||||
52,450 | Hasbro, Inc. | 2,898,387 | ||||||
37,093 | Home Depot, Inc. (The) | 2,949,264 | ||||||
30,434 | Lowe’s Cos., Inc. | 1,397,225 | ||||||
74,985 | Mattel, Inc. | 2,940,537 | ||||||
28,644 | McDonald’s Corp. | 2,903,929 | ||||||
58,962 | NIKE, Inc., Class B | 4,301,278 | ||||||
46,292 | Nordstrom, Inc. | 2,836,774 | ||||||
61,525 | Omnicom Group, Inc. | 4,164,012 | ||||||
41,933 | PetSmart, Inc. | 2,838,025 | ||||||
18,519 | Ralph Lauren Corp. | 2,803,221 | ||||||
61,146 | Ross Stores, Inc. | 4,162,820 | ||||||
47,727 | Target Corp. | 2,947,142 | ||||||
16,496 | Tiffany & Co. | 1,443,235 | ||||||
72,552 | TJX Cos., Inc. (The) | 4,221,075 | ||||||
48,740 | VF Corp. | 2,977,526 | ||||||
55,113 | Walt Disney Co. (The) | 4,372,665 | ||||||
56,814 | Yum! Brands, Inc. | 4,374,110 | ||||||
|
| |||||||
70,639,295 | ||||||||
|
| |||||||
Consumer Staples—19.7% | ||||||||
37,657 | Altria Group, Inc. | 1,510,422 | ||||||
31,916 | Brown-Forman Corp., Class B | 2,863,504 | ||||||
31,864 | Campbell Soup Co. | 1,449,493 | ||||||
32,043 | Clorox Co. (The) | 2,906,300 | ||||||
109,843 | Coca-Cola Co. (The) | 4,480,496 | ||||||
64,785 | Colgate-Palmolive Co. | 4,360,031 | ||||||
25,407 | Costco Wholesale Corp. | 2,939,082 | ||||||
58,574 | CVS Caremark Corp. | 4,259,501 | ||||||
20,661 | Estee Lauder Cos., Inc. (The), Class A | 1,499,369 | ||||||
55,840 | General Mills, Inc. | 2,960,637 | ||||||
14,439 | Hershey Co. (The) | 1,389,609 | ||||||
90,411 | Hormel Foods Corp. | 4,311,701 | ||||||
29,821 | J.M. Smucker Co. (The) | 2,883,094 | ||||||
65,112 | Kellogg Co. | 4,351,435 | ||||||
25,642 | Kimberly-Clark Corp. | 2,878,315 | ||||||
81,691 | Lorillard, Inc. | 4,854,079 | ||||||
60,536 | McCormick & Co., Inc. | 4,310,163 | ||||||
34,057 | PepsiCo, Inc. | 2,925,156 | ||||||
52,679 | Procter & Gamble Co. (The) | 4,348,651 | ||||||
79,284 | Sysco Corp. | 2,888,316 | ||||||
44,919 | Walgreen Co. | 3,050,000 | ||||||
55,555 | Wal-Mart Stores, Inc. | 4,428,289 | ||||||
|
| |||||||
71,847,643 | ||||||||
|
| |||||||
Energy—2.1% | ||||||||
24,408 | Chevron Corp. | 3,063,692 | ||||||
29,437 | Exxon Mobil Corp. | 3,014,643 | ||||||
16,960 | Hess Corp. | 1,512,154 | ||||||
|
| |||||||
7,590,489 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials—5.7% | ||||||||
23,058 | Aflac, Inc. | $ | 1,446,198 | |||||
13,558 | Ameriprise Financial, Inc. | 1,513,480 | ||||||
9,620 | BlackRock, Inc. | 2,895,620 | ||||||
32,217 | Chubb Corp. (The) | 2,966,541 | ||||||
23,091 | Health Care REIT, Inc. | 1,456,811 | ||||||
64,931 | Kimco Realty Corp. REIT | 1,488,219 | ||||||
18,589 | Moody’s Corp. | 1,459,236 | ||||||
18,229 | T. Rowe Price Group, Inc. | 1,497,148 | ||||||
36,842 | Torchmark Corp. | 2,936,307 | ||||||
16,756 | Travelers Cos., Inc. (The) | 1,517,758 | ||||||
29,845 | Wells Fargo & Co. | 1,481,506 | ||||||
|
| |||||||
20,658,824 | ||||||||
|
| |||||||
Health Care—9.3% | ||||||||
76,433 | Abbott Laboratories | 2,961,014 | ||||||
43,814 | AmerisourceBergen Corp. | 2,855,797 | ||||||
39,411 | Baxter International, Inc. | 2,868,727 | ||||||
25,283 | Becton, Dickinson and Co. | 2,857,737 | ||||||
20,595 | C.R. Bard, Inc. | 2,828,311 | ||||||
31,600 | DENTSPLY International, Inc. | 1,410,308 | ||||||
44,264 | Johnson & Johnson | 4,483,501 | ||||||
8,501 | McKesson Corp. | 1,438,284 | ||||||
47,385 | Medtronic, Inc. | 2,787,186 | ||||||
30,250 | Mylan, Inc.(b) | 1,536,095 | ||||||
24,072 | Quest Diagnostics, Inc. | 1,346,347 | ||||||
35,773 | Stryker Corp. | 2,781,351 | ||||||
53,412 | UnitedHealth Group, Inc. | 4,008,036 | ||||||
|
| |||||||
34,162,694 | ||||||||
|
| |||||||
Industrials—27.2% | ||||||||
31,887 | 3M Co. | 4,435,163 | ||||||
57,299 | AMETEK, Inc. | 3,020,803 | ||||||
79,400 | C.H. Robinson Worldwide, Inc. | 4,676,660 | ||||||
27,848 | Caterpillar, Inc. | 2,935,179 | ||||||
25,090 | Cintas Corp. | 1,478,554 | ||||||
101,818 | CSX Corp. | 2,873,304 | ||||||
9,881 | Cummins, Inc. | 1,490,549 | ||||||
57,624 | Danaher Corp. | 4,228,449 | ||||||
30,720 | Deere & Co. | 2,867,405 | ||||||
34,655 | Dover Corp. | 2,994,192 | ||||||
64,673 | Emerson Electric Co. | 4,409,405 | ||||||
73,268 | Expeditors International of Washington, Inc. | 3,021,572 | ||||||
56,154 | Fastenal Co. | 2,812,192 | ||||||
18,748 | Fluor Corp. | 1,419,224 | ||||||
26,953 | General Dynamics Corp. | 2,950,006 | ||||||
55,668 | General Electric Co. | 1,496,913 | ||||||
31,180 | Honeywell International, Inc. | 2,896,622 | ||||||
17,388 | Illinois Tool Works, Inc. | 1,481,979 | ||||||
37,399 | L-3 Communications Holdings, Inc. | 4,314,723 | ||||||
27,482 | Lockheed Martin Corp. | 4,510,895 | ||||||
30,137 | Norfolk Southern Corp. | 2,848,851 | ||||||
24,306 | Northrop Grumman Corp. | 2,953,422 | ||||||
32,625 | Pall Corp. | 2,745,394 | ||||||
23,769 | Parker Hannifin Corp. | 3,015,811 | ||||||
44,005 | Raytheon Co. | 4,201,597 | ||||||
41,299 | Republic Services, Inc. | 1,449,182 | ||||||
37,088 | Rockwell Collins, Inc. | 2,879,883 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 38 |
|
PowerShares S&P 500® High Quality Portfolio (SPHQ) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
21,715 | Roper Industries, Inc. | $ | 3,017,299 | |||||
25,889 | Snap-On, Inc. | 3,003,124 | ||||||
23,268 | Union Pacific Corp. | 4,430,925 | ||||||
37,287 | United Technologies Corp. | 4,412,171 | ||||||
16,935 | W.W. Grainger, Inc. | 4,308,264 | ||||||
|
| |||||||
99,579,712 | ||||||||
|
| |||||||
Information Technology—4.7% | ||||||||
15,642 | Amphenol Corp., Class A | 1,491,465 | ||||||
37,861 | Automatic Data Processing, Inc. | 2,951,643 | ||||||
21,829 | International Business Machines Corp. | 4,288,744 | ||||||
29,839 | Linear Technology Corp. | 1,327,835 | ||||||
36,178 | Microsoft Corp. | 1,461,591 | ||||||
35,786 | Oracle Corp. | 1,462,932 | ||||||
70,094 | Paychex, Inc. | 2,930,630 | ||||||
18,249 | QUALCOMM, Inc. | 1,436,379 | ||||||
|
| |||||||
17,351,219 | ||||||||
|
| |||||||
Materials—8.3% | ||||||||
24,582 | Air Products & Chemicals, Inc. | 2,888,877 | ||||||
27,280 | Airgas, Inc. | 2,898,773 | ||||||
52,019 | Ball Corp. | 2,922,948 | ||||||
21,422 | E.I. du Pont de Nemours & Co. | 1,442,129 | ||||||
40,677 | Ecolab, Inc. | 4,256,441 | ||||||
15,460 | International Flavors & Fragrances, Inc. | 1,523,119 | ||||||
25,305 | Monsanto Co. | 2,801,264 | ||||||
33,337 | Praxair, Inc. | 4,352,145 | ||||||
14,988 | Sherwin-Williams Co. (The) | 2,995,202 | ||||||
45,987 | Sigma-Aldrich Corp. | 4,424,409 | ||||||
|
| |||||||
30,505,307 | ||||||||
|
| |||||||
Utilities—3.7% | ||||||||
56,742 | AGL Resources, Inc. | 3,064,068 | ||||||
20,325 | Entergy Corp. | 1,473,563 | ||||||
29,741 | NextEra Energy, Inc. | 2,969,639 | ||||||
27,571 | SCANA Corp. | 1,480,011 | ||||||
32,145 | Southern Co. (The) | 1,473,205 | ||||||
60,749 | Wisconsin Energy Corp. | 2,945,112 | ||||||
|
| |||||||
13,405,598 | ||||||||
|
| |||||||
Total Investments (Cost $294,601,938)—100.0% | 365,740,781 | |||||||
Other assets less liabilities—(0.0)% | (54,578 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 365,686,203 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 39 |
|
Schedule of Investments(a)
PowerShares Water Resources Portfolio (PHO)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—99.9% | ||||||||
Chemicals—2.5% | ||||||||
1,251,574 | Calgon Carbon Corp.(b) | $ | 25,069,027 | |||||
|
| |||||||
Commercial Services & Supplies—3.9% | ||||||||
1,332,695 | Tetra Tech, Inc.(b) | 38,208,366 | ||||||
|
| |||||||
Construction & Engineering—4.3% | ||||||||
971,720 | Aegion Corp.(b) | 24,769,143 | ||||||
784,314 | Layne Christensen Co.(b) | 13,662,750 | ||||||
128,541 | Northwest Pipe Co.(b) | 4,597,911 | ||||||
|
| |||||||
43,029,804 | ||||||||
|
| |||||||
Electrical Equipment—2.8% | ||||||||
719,714 | Franklin Electric Co., Inc. | 27,831,340 | ||||||
|
| |||||||
Electronic Equipment, Instruments & Components—5.5% | ||||||||
206,154 | Badger Meter, Inc. | 10,214,931 | ||||||
1,164,343 | Itron, Inc.(b) | 44,245,034 | ||||||
|
| |||||||
54,459,965 | ||||||||
|
| |||||||
Industrial Conglomerates—8.4% | ||||||||
600,973 | Roper Industries, Inc. | 83,505,198 | ||||||
|
| |||||||
Life Sciences Tools & Services—7.3% | ||||||||
731,635 | Waters Corp.(b) | 72,095,313 | ||||||
|
| |||||||
Machinery—47.2% | ||||||||
2,094,141 | Energy Recovery, Inc.(b) | 10,701,061 | ||||||
1,003,620 | Flowserve Corp. | 73,314,441 | ||||||
196,027 | Gorman-Rupp Co. (The) | 6,086,638 | ||||||
480,232 | Lindsay Corp. | 42,322,846 | ||||||
3,681,997 | Mueller Water Products, Inc., Class A | 33,579,813 | ||||||
947,720 | Pall Corp. | 79,750,638 | ||||||
1,008,592 | Pentair Ltd. | 74,928,300 | ||||||
615,312 | Toro Co. (The) | 39,096,924 | ||||||
279,837 | Valmont Industries, Inc. | 41,670,528 | ||||||
500,690 | Watts Water Technologies, Inc., Class A | 26,636,708 | ||||||
1,035,631 | Xylem, Inc. | 38,929,369 | ||||||
|
| |||||||
467,017,266 | ||||||||
|
| |||||||
Multi-Utilities—1.1% | ||||||||
601,397 | Veolia Environnement SA ADR (France) | 11,294,236 | ||||||
|
| |||||||
Water Utilities—16.9% | ||||||||
606,235 | American States Water Co. | 18,405,295 | ||||||
908,837 | American Water Works Co., Inc. | 41,379,349 | ||||||
1,617,790 | Aqua America, Inc. | 40,590,351 | ||||||
722,135 | California Water Service Group | 16,248,037 | ||||||
4,396,127 | Cia de Saneamento Basico do Estado de Sao Paulo ADR (Brazil) | 41,675,284 | ||||||
123,145 | Connecticut Water Service, Inc. | 4,002,212 | ||||||
424,598 | Consolidated Water Co. Ltd. (Cayman Islands) | 4,933,829 | ||||||
|
| |||||||
167,234,357 | ||||||||
|
| |||||||
Total Investments (Cost $772,187,090)—99.9% | 989,744,872 | |||||||
Other assets less liabilities—0.1% | 502,215 | |||||||
|
| |||||||
Net Assets—100.0% | $ | 990,247,087 | ||||||
|
|
Investment Abbreviations:
ADR—American Depositary Receipt
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 40 |
|
Schedule of Investments(a)
PowerShares WilderHill Clean Energy Portfolio (PBW)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—99.9% | ||||||||
Auto Components—6.7% | ||||||||
471,131 | Fuel Systems Solutions, Inc.(b) | $ | 4,937,453 | |||||
154,364 | Gentherm, Inc.(b) | 5,611,132 | ||||||
469,321 | Quantum Fuel Systems Technologies Worldwide, Inc.(b) | 3,102,212 | ||||||
456,797 | UQM Technologies, Inc.(b)(c) | 1,009,521 | ||||||
|
| |||||||
14,660,318 | ||||||||
|
| |||||||
Automobiles—2.2% | ||||||||
22,835 | Tesla Motors, Inc.(b) | 4,747,168 | ||||||
|
| |||||||
Chemicals—8.9% | ||||||||
38,278 | Air Products & Chemicals, Inc. | 4,498,430 | ||||||
53,440 | Cytec Industries, Inc. | 5,093,901 | ||||||
151,620 | OM Group, Inc. | 4,440,950 | ||||||
166,248 | Sociedad Quimica y Minera de Chile SA ADR (Chile) | 5,303,311 | ||||||
|
| |||||||
19,336,592 | ||||||||
|
| |||||||
Commercial Services & Supplies—2.5% | ||||||||
233,110 | EnerNOC, Inc.(b) | 5,501,396 | ||||||
|
| |||||||
Construction & Engineering—4.1% | ||||||||
630,188 | Ameresco, Inc., Class A(b) | 4,039,505 | ||||||
136,587 | Quanta Services, Inc.(b) | 4,818,789 | ||||||
|
| |||||||
8,858,294 | ||||||||
|
| |||||||
Electric Utilities—2.3% | ||||||||
138,450 | ITC Holdings Corp. | 5,118,497 | ||||||
|
| |||||||
Electrical Equipment—17.7% | ||||||||
655,409 | American Superconductor Corp.(b)(c) | 838,924 | ||||||
843,673 | Ballard Power Systems, Inc. (Canada)(b)(c) | 3,087,843 | ||||||
116,291 | Broadwind Energy, Inc.(b) | 1,568,766 | ||||||
1,677,654 | China Ming Yang Wind Power Group Ltd. ADR (China)(b)(c) | 3,908,934 | ||||||
549,554 | Enphase Energy, Inc.(b)(c) | 4,149,133 | ||||||
1,565,568 | FuelCell Energy, Inc.(b)(c) | 3,553,839 | ||||||
167,062 | Hydrogenics Corp. (Canada)(b)(c) | 3,521,667 | ||||||
187,262 | Orion Energy Systems, Inc.(b) | 992,489 | ||||||
538,083 | Plug Power, Inc.(b)(c) | 2,502,086 | ||||||
143,309 | Polypore International, Inc.(b)(c) | 4,969,956 | ||||||
205,248 | PowerSecure International, Inc.(b) | 4,562,663 | ||||||
257,127 | Real Goods Solar, Inc., Class A(b)(c) | 753,382 | ||||||
80,178 | SolarCity Corp.(c) | 4,269,478 | ||||||
|
| |||||||
38,679,160 | ||||||||
|
| |||||||
Electronic Equipment, Instruments & Components—7.1% | ||||||||
385,286 | Echelon Corp.(b) | 997,891 | ||||||
140,406 | Itron, Inc.(b) | 5,335,428 | ||||||
374,119 | Maxwell Technologies, Inc.(b) | 5,634,232 | ||||||
135,868 | Universal Display Corp.(b)(c) | 3,539,361 | ||||||
|
| |||||||
15,506,912 | ||||||||
|
| |||||||
Independent Power Producers & Energy Traders—7.0% | ||||||||
247,920 | Calpine Corp.(b) | 5,684,805 | ||||||
172,129 | Ormat Technologies, Inc. (Israel) | 4,592,402 | ||||||
187,321 | Pattern Energy Group, Inc. | 5,020,203 | ||||||
|
| |||||||
15,297,410 | ||||||||
|
| |||||||
Metals & Mining—0.5% | ||||||||
773,045 | Rare Element Resources Ltd. (Canada)(b)(c) | 997,228 | ||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Oil, Gas & Consumable Fuels—6.2% | ||||||||
1,155,702 | Amyris, Inc.(b)(c) | $ | 4,068,071 | |||||
972,539 | Gevo, Inc.(b)(c) | 1,001,715 | ||||||
394,347 | Renewable Energy Group, Inc.(b) | 4,641,465 | ||||||
353,158 | Solazyme, Inc.(b)(c) | 3,799,980 | ||||||
|
| |||||||
13,511,231 | ||||||||
|
| |||||||
Semiconductors & Semiconductor Equipment—32.6% | ||||||||
171,207 | Advanced Energy Industries, Inc.(b) | 3,746,009 | ||||||
296,260 | Aixtron SE ADR (Germany)(b)(c) | 4,677,945 | ||||||
151,994 | Canadian Solar, Inc. (Canada)(b) | 4,122,077 | ||||||
77,457 | Cree, Inc.(b) | 3,653,647 | ||||||
133,886 | Daqo New Energy Corp. ADR (China)(b)(c) | 5,498,698 | ||||||
71,204 | First Solar, Inc.(b) | 4,805,558 | ||||||
283,887 | GT Advanced Technologies, Inc.(b)(c) | 4,715,363 | ||||||
1,553,115 | Hanwha SolarOne Co. Ltd. ADR (South Korea)(b)(c) | 4,038,099 | ||||||
166,173 | International Rectifier Corp.(b) | 4,327,145 | ||||||
495,886 | JA Solar Holdings Co. Ltd. ADR (China)(b)(c) | 4,775,382 | �� | |||||
1,264,743 | ReneSola Ltd. ADR (China)(b)(c) | 3,440,101 | ||||||
385,959 | Rubicon Technology, Inc.(b)(c) | 3,909,765 | ||||||
717,822 | STR Holdings, Inc.(b) | 1,134,159 | ||||||
256,476 | SunEdison, Inc.(b) | 4,932,033 | ||||||
164,159 | SunPower Corp. (France)(b)(c) | 5,486,194 | ||||||
358,746 | Trina Solar Ltd. ADR (China)(b)(c) | 4,010,780 | ||||||
1,108,637 | Yingli Green Energy Holding Co. Ltd. ADR (China)(b)(c) | 3,791,539 | ||||||
|
| |||||||
71,064,494 | ||||||||
|
| |||||||
Software—2.1% | ||||||||
308,535 | Silver Spring Networks, Inc.(b) | 4,621,854 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $207,563,893)—99.9% | 217,900,554 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—28.3% | ||||||||
61,809,331 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $61,809,331) | 61,809,331 | ||||||
|
| |||||||
Total Investments (Cost $269,373,224)—128.2% | 279,709,885 | |||||||
Other assets less liabilities—(28.2)% | (61,608,661 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 218,101,224 | ||||||
|
|
Investment Abbreviations:
ADR—American Depositary Receipt
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 41 |
|
PowerShares WilderHill Clean Energy Portfolio (PBW) (continued)
April 30, 2014
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2I. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Citibank | $ | 58,374,719 | $ | (58,374,719 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
This Fund has holdings greater than 10% of net assets in the following country:
China | 11.7 | % |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 42 |
|
Schedule of Investments(a)
PowerShares WilderHill Progressive Energy Portfolio (PUW)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Aerospace & Defense—1.6% | ||||||||
17,944 | Hexcel Corp.(b) | $ | 748,085 | |||||
|
| |||||||
Auto Components—5.5% | ||||||||
16,991 | Johnson Controls, Inc. | 766,974 | ||||||
34,657 | Remy International, Inc. | 919,103 | ||||||
14,078 | Tenneco, Inc.(b) | 842,850 | ||||||
|
| |||||||
2,528,927 | ||||||||
|
| |||||||
Automobiles—3.0% | ||||||||
44,581 | Kandi Technologies Group, Inc. (China)(b)(c) | 499,753 | ||||||
22,899 | Tata Motors Ltd. ADR (India) | 856,881 | ||||||
|
| |||||||
1,356,634 | ||||||||
|
| |||||||
Building Products—4.9% | ||||||||
16,722 | A.O. Smith Corp. | 781,921 | ||||||
23,503 | Apogee Enterprises, Inc. | 746,690 | ||||||
17,865 | Owens Corning | 729,785 | ||||||
|
| |||||||
2,258,396 | ||||||||
|
| |||||||
Chemicals—6.6% | ||||||||
31,044 | Advanced Emissions Solutions, Inc.(b) | 711,839 | ||||||
21,058 | LSB Industries, Inc.(b) | 804,205 | ||||||
12,463 | Methanex Corp. (Canada) | 772,706 | ||||||
10,313 | Rockwood Holdings, Inc. | 732,739 | ||||||
|
| |||||||
3,021,489 | ||||||||
|
| |||||||
Commercial Services & Supplies—2.2% | ||||||||
50,670 | China Recycling Energy Corp.(b)(c) | 157,584 | ||||||
46,460 | Covanta Holding Corp. | 857,187 | ||||||
|
| |||||||
1,014,771 | ||||||||
|
| |||||||
Construction & Engineering—6.8% | ||||||||
35,787 | Abengoa SA ADR (Spain)(b)(c) | 803,060 | ||||||
9,343 | Chicago Bridge & Iron Co. NV | 748,094 | ||||||
24,572 | Foster Wheeler AG (Switzerland)(b) | 842,328 | ||||||
18,455 | MasTec, Inc.(b) | 730,449 | ||||||
|
| |||||||
3,123,931 | ||||||||
|
| |||||||
Electric Utilities—6.4% | ||||||||
313,906 | Centrais Eletricas Brasileiras SA ADR (Brazil)(c) | 1,089,254 | ||||||
129,327 | Companhia Energetica de Minas Gerais ADR (Brazil)(c) | 975,126 | ||||||
20,194 | NRG Yield, Inc., Class A(c) | 865,111 | ||||||
|
| |||||||
2,929,491 | ||||||||
|
| |||||||
Electrical Equipment—16.0% | ||||||||
5,578 | Acuity Brands, Inc. | 694,852 | ||||||
342,164 | Capstone Turbine Corp.(b)(c) | 704,858 | ||||||
10,519 | Eaton Corp. PLC | 764,100 | ||||||
11,722 | Emerson Electric Co. | 799,206 | ||||||
11,385 | EnerSys | 769,398 | ||||||
28,646 | General Cable Corp. | 733,911 | ||||||
11,612 | Global Power Equipment Group, Inc. | 203,558 | ||||||
73,021 | GrafTech International Ltd.(b)(c) | 818,565 | ||||||
10,342 | Power Solutions International, Inc.(b) | 855,801 | ||||||
10,699 | Regal-Beloit Corp. | 799,536 | ||||||
68,832 | Revolution Lighting Technologies, Inc.(b)(c) | 200,301 | ||||||
|
| |||||||
7,344,086 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Electronic Equipment, Instruments & Components—1.8% | ||||||||
38,766 | Corning, Inc. | $ | 810,597 | |||||
|
| |||||||
Energy Equipment & Services—3.1% | ||||||||
96,968 | McDermott International, Inc.(b)(c) | 701,079 | ||||||
41,254 | Nuverra Environmental Solutions, Inc.(b)(c) | 701,730 | ||||||
|
| |||||||
1,402,809 | ||||||||
|
| |||||||
Food & Staples Retailing—2.0% | ||||||||
14,355 | Andersons, Inc. (The) | 894,173 | ||||||
|
| |||||||
Household Products—2.0% | ||||||||
8,156 | Energizer Holdings, Inc. | 910,944 | ||||||
|
| |||||||
Industrial Conglomerates—3.3% | ||||||||
22,799 | Koninklijke Philips NV (Netherlands) | 728,656 | ||||||
5,771 | Siemens AG ADR (Germany) | 760,791 | ||||||
|
| |||||||
1,489,447 | ||||||||
|
| |||||||
Machinery—12.5% | ||||||||
23,032 | Altra Industrial Motion Corp. | 786,773 | ||||||
10,095 | Chart Industries, Inc.(b) | 688,681 | ||||||
41,249 | Energy Recovery, Inc.(b)(c) | 210,782 | ||||||
21,688 | ESCO Technologies, Inc. | 724,813 | ||||||
39,880 | Luxfer Holdings PLC ADR (United Kingdom) | 787,630 | ||||||
34,007 | PMFG, Inc.(b) | 192,820 | ||||||
7,624 | WABCO Holdings, Inc.(b) | 815,844 | ||||||
53,945 | Westport Innovations, Inc. (Canada)(b)(c) | 707,758 | ||||||
18,609 | Woodward, Inc. | 834,242 | ||||||
|
| |||||||
5,749,343 | ||||||||
|
| |||||||
Oil, Gas & Consumable Fuels—20.4% | ||||||||
35,492 | Cameco Corp. (Canada) | 755,625 | ||||||
32,637 | Chesapeake Energy Corp. | 938,314 | ||||||
89,948 | Clean Energy Fuels Corp.(b)(c) | 796,040 | ||||||
76,737 | Cosan Ltd., Class A (Brazil) | 930,820 | ||||||
563,956 | Denison Mines Corp. (Canada)(b)(c) | 772,620 | ||||||
18,664 | Golar LNG Ltd. (Norway)(c) | 824,949 | ||||||
27,942 | Green Plains Renewable Energy, Inc. | 835,466 | ||||||
9,559 | Range Resources Corp. | 864,611 | ||||||
452,401 | Rentech, Inc.(b) | 959,090 | ||||||
14,251 | Sasol Ltd. ADR (South Africa) | 789,648 | ||||||
18,120 | Southwestern Energy Co.(b) | 867,585 | ||||||
|
| |||||||
9,334,768 | ||||||||
|
| |||||||
Real Estate Investment Trusts—0.4% | ||||||||
15,588 | Hannon Armstrong Sustainable Infrastructure Capital, Inc. REIT | 206,073 | ||||||
|
| |||||||
Semiconductors & Semiconductor Equipment—1.5% | ||||||||
18,792 | Veeco Instruments, Inc.(b) | 694,740 | ||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $36,523,898) | 45,818,704 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
12,442 | Invesco Premier Portfolio—Institutional Class(d) (Cost $12,442) | 12,442 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $36,536,340)—100.0% | 45,831,146 | |||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 43 |
|
PowerShares WilderHill Progressive Energy Portfolio (PUW) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—17.8% | ||||||||
8,134,927 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $8,134,927) | $ | 8,134,927 | |||||
|
| |||||||
Total Investments (Cost $44,671,267)—117.8% | 53,966,073 | |||||||
Other assets less liabilities—(17.8)% | (8,146,967 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 45,819,106 | ||||||
|
|
Investment Abbreviations:
ADR—American Depositary Receipt
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2I. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brother Harriman | $ | 7,926,040 | $ | (7,926,040 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 44 |
|
(This Page Intentionally Left Blank)
Statements of Assets and Liabilities
April 30, 2014
PowerShares Aerospace & Defense Portfolio (PPA) | PowerShares CleantechTM Portfolio (PZD) | PowerShares DWA Momentum Portfolio (PDP) | PowerShares Global Listed Private Equity Portfolio (PSP) | |||||||||||||
Assets: | ||||||||||||||||
Unaffiliated investments, at value(a) | $ | 98,075,064 | $ | 84,481,722 | $ | 1,260,721,806 | $ | 529,296,848 | ||||||||
Affiliated investments, at value | 74,614 | 6,110,040 | 614,538 | 79,417,245 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at value | 98,149,678 | 90,591,762 | 1,261,336,344 | 608,714,093 | ||||||||||||
Cash segregated as collateral | — | — | — | 1,180,956 | ||||||||||||
Foreign currencies, at value | — | — | — | 16,313 | ||||||||||||
Receivables: | ||||||||||||||||
Dividends | 57,801 | 80,496 | 326,834 | 1,079,091 | ||||||||||||
Investments sold | — | — | 3,673,176 | 7,475,349 | ||||||||||||
Foreign tax reclaims | — | 95,706 | — | 394,030 | ||||||||||||
Security lending | — | 9,459 | — | 39,687 | ||||||||||||
Shares sold | — | — | — | 1,933,212 | ||||||||||||
Other assets | 3,330 | 3,330 | 4,602 | 4,996 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Assets | 98,210,809 | 90,780,753 | 1,265,340,956 | 620,837,727 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Liabilities: | ||||||||||||||||
Due to custodian | — | 14,799 | — | — | ||||||||||||
Payables: | ||||||||||||||||
Shares repurchased | — | — | 3,671,888 | — | ||||||||||||
Collateral upon receipt of securities in-kind | — | — | — | 1,180,956 | ||||||||||||
Payable for swaps | — | — | — | 257,392 | ||||||||||||
Investments purchased | — | — | — | 8,534,891 | ||||||||||||
Collateral upon return of securities loaned | — | 6,110,040 | — | 23,404,087 | ||||||||||||
Expenses recaptured | — | — | — | 10,654 | ||||||||||||
Unrealized depreciation on swap agreements | — | — | — | 3,275,074 | ||||||||||||
Open options written, at value | — | — | — | — | ||||||||||||
Accrued advisory fees | 36,799 | 32,319 | 524,224 | 230,942 | ||||||||||||
Accrued trustees’ and officer’s fees | 17,079 | 15,912 | 36,446 | 23,750 | ||||||||||||
Accrued expenses | 70,704 | 72,265 | 664,855 | 318,715 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Liabilities | 124,582 | 6,245,335 | 4,897,413 | 37,236,461 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 98,086,227 | $ | 84,535,418 | $ | 1,260,443,543 | $ | 583,601,266 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets Consist of: | ||||||||||||||||
Shares of beneficial interest | $ | 111,063,857 | $ | 145,613,383 | $ | 1,244,820,140 | $ | 627,570,238 | ||||||||
Undistributed net investment income (loss) | (15,632 | ) | 156,212 | (31,513 | ) | (23,516,305 | ) | |||||||||
Undistributed net realized gain (loss) | (29,743,756 | ) | (85,404,780 | ) | (208,271,664 | ) | (96,435,948 | ) | ||||||||
Net unrealized appreciation | 16,781,758 | 24,170,603 | 223,926,580 | 75,983,281 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 98,086,227 | $ | 84,535,418 | $ | 1,260,443,543 | $ | 583,601,266 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 3,050,000 | 2,650,000 | 34,100,000 | 49,500,000 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net asset value | $ | 32.16 | $ | 31.90 | $ | 36.96 | $ | 11.79 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Market price | $ | 32.15 | $ | 31.92 | $ | 36.93 | $ | 11.85 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Unaffiliated investments, at cost | $ | 81,293,306 | $ | 60,314,257 | $ | 1,036,795,226 | $ | 450,063,527 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Affiliated investments, at cost | $ | 74,614 | $ | 6,110,040 | $ | 614,538 | $ | 79,417,245 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at cost | $ | 81,367,920 | $ | 66,424,297 | $ | 1,037,409,764 | $ | 529,480,772 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Foreign currencies, at cost | $ | — | $ | — | $ | — | $ | 16,292 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Premium received on written options | $ | — | $ | — | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
(a) Includes securities on loan with an aggregate value of | $ | — | $ | 5,994,327 | $ | — | $ | 22,883,255 | ||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 46 |
|
PowerShares Golden Dragon China Portfolio (PGJ) | PowerShares S&P 500 BuyWrite Portfolio (PBP) | PowerShares S&P 500® High Quality Portfolio (SPHQ) | PowerShares Water Resources Portfolio (PHO) | PowerShares WilderHill Clean Energy Portfolio (PBW) | PowerShares WilderHill Progressive Energy Portfolio (PUW) | |||||||||||||||||
$ | 258,417,754 | $ | 252,676,462 | $ | 365,740,781 | $ | 989,744,872 | $ | 217,900,554 | $ | 45,818,704 | |||||||||||
43,487,765 | 227,034 | — | — | 61,809,331 | 8,147,369 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
301,905,519 | 252,903,496 | 365,740,781 | 989,744,872 | 279,709,885 | 53,966,073 | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
74,984 | 234,195 | 379,062 | 1,804,680 | 46,907 | 28,512 | |||||||||||||||||
9,720,925 | 267,367 | — | — | — | — | |||||||||||||||||
— | 144 | — | — | 32,697 | 16,260 | |||||||||||||||||
140,189 | — | — | — | 549,449 | 19,403 | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
3,330 | — | 2,935 | 4,996 | 4,996 | 3,333 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
311,844,947 | 253,405,202 | 366,122,778 | 991,554,548 | 280,343,934 | 54,033,581 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
— | 16,855 | 161,569 | 18,328 | 71,532 | — | |||||||||||||||||
9,660,402 | — | — | — | — | — | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
63,164 | 116,896 | — | — | — | — | |||||||||||||||||
43,026,256 | — | — | — | 61,809,331 | 8,134,927 | |||||||||||||||||
13,670 | — | — | — | 15,382 | — | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
— | 3,659,675 | — | — | — | — | |||||||||||||||||
119,744 | 153,351 | 51,693 | 412,686 | 94,858 | 10,252 | |||||||||||||||||
29,173 | — | 18,733 | 78,477 | 41,829 | 12,758 | |||||||||||||||||
363,964 | — | 204,580 | 797,970 | 209,778 | 56,538 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
53,276,373 | 3,946,777 | 436,575 | 1,307,461 | 62,242,710 | 8,214,475 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 258,568,574 | $ | 249,458,425 | $ | 365,686,203 | $ | 990,247,087 | $ | 218,101,224 | $ | 45,819,106 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 528,558,250 | $ | 236,694,173 | $ | 434,812,660 | $ | 1,324,132,081 | $ | 1,665,198,862 | $ | 70,032,413 | |||||||||||
(1,293,541 | ) | 492,190 | 660,203 | 2,193,553 | (336,558 | ) | 70,727 | |||||||||||||||
(294,769,302 | ) | (39,200,631 | ) | (140,925,503 | ) | (553,636,329 | ) | (1,457,097,741 | ) | (33,578,840 | ) | |||||||||||
26,073,167 | 51,472,693 | 71,138,843 | 217,557,782 | 10,336,661 | 9,294,806 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 258,568,574 | $ | 249,458,425 | $ | 365,686,203 | $ | 990,247,087 | $ | 218,101,224 | $ | 45,819,106 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
9,350,000 | 11,700,000 | 17,500,000 | 38,200,000 | 33,100,000 | 1,400,000 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 27.65 | $ | 21.32 | $ | 20.90 | $ | 25.92 | $ | 6.59 | $ | 32.73 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 27.60 | $ | 21.35 | $ | 20.89 | $ | 25.91 | $ | 6.59 | $ | 32.71 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 232,344,587 | $ | 200,445,344 | $ | 294,601,938 | $ | 772,187,090 | $ | 207,563,893 | $ | 36,523,898 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 43,487,765 | $ | 168,096 | $ | — | $ | — | $ | 61,809,331 | $ | 8,147,369 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 275,832,352 | $ | 200,613,440 | $ | 294,601,938 | $ | 772,187,090 | $ | 269,373,224 | $ | 44,671,267 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | — | $ | 2,842,312 | $ | — | $ | — | $ | — | $ | — | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 41,317,489 | $ | — | $ | — | $ | — | $ | 58,374,719 | $ | 7,926,040 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| 47 |
|
For the year ended April 30, 2014
PowerShares Aerospace & Defense Portfolio (PPA) | PowerShares CleantechTM Portfolio (PZD) | PowerShares DWA Momentum Portfolio (PDP) | PowerShares Global Listed Private Equity Portfolio (PSP) | |||||||||||||
Investment Income: | ||||||||||||||||
Unaffiliated dividend income | $ | 1,397,377 | $ | 961,090 | $ | 8,634,716 | $ | 18,934,898 | ||||||||
Affiliated dividend income | 13 | 6 | 137 | 6,601 | ||||||||||||
Securities lending income | — | 124,023 | — | 136,776 | ||||||||||||
Foreign withholding tax | — | (107,201 | ) | (2,077 | ) | (660,236 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Total Income | 1,397,390 | 977,918 | 8,632,776 | 18,418,039 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Expenses: | ||||||||||||||||
Advisory fees | 390,584 | 388,917 | 5,352,329 | 2,366,237 | ||||||||||||
Sub-licensing | 46,871 | 58,337 | 1,070,466 | 473,248 | ||||||||||||
Accounting & administration fees | 36,058 | 36,058 | 211,362 | 92,600 | ||||||||||||
Professional fees | 25,465 | 35,658 | 37,429 | 43,554 | ||||||||||||
Printing | 12,766 | 11,445 | 56,059 | 24,981 | ||||||||||||
Trustees’ and officer’s fees | 10,527 | 10,688 | 37,309 | 20,810 | ||||||||||||
Custodian & transfer agent fees | 3,022 | 9,636 | 11,640 | 34,286 | ||||||||||||
Recapture (Note 3) | — | — | — | 227,207 | ||||||||||||
Other expenses | 13,237 | 8,497 | 56,636 | 29,983 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Expenses | 538,530 | 559,236 | 6,833,230 | 3,312,906 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Waivers | (23,005 | ) | (34,226 | ) | (934 | ) | (54,201 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Expenses | 515,525 | 525,010 | 6,832,296 | 3,258,705 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Investment Income | 881,865 | 452,908 | 1,800,480 | 15,159,334 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Realized and Unrealized Gain (Loss): | ||||||||||||||||
Net realized gain (loss) from: | ||||||||||||||||
Investment securities | (229,319 | ) | (1,553,839 | ) | 17,476,020 | 1,714,809 | ||||||||||
Swap agreements | — | — | — | 13,956,646 | ||||||||||||
Options written | — | — | — | — | ||||||||||||
In-kind redemptions | 5,465,685 | 1,512,917 | 38,948,550 | 20,173,900 | ||||||||||||
Foreign currencies | — | (157 | ) | — | (145,485 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized gain (loss) | 5,236,366 | (41,079 | ) | 56,424,570 | 35,699,870 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Change in net unrealized appreciation (depreciation) on: | ||||||||||||||||
Investment securities | 17,672,034 | 17,267,009 | 95,556,132 | 17,126,170 | ||||||||||||
Swap agreements | — | — | — | (3,194,533 | ) | |||||||||||
Options written | — | — | — | — | ||||||||||||
Foreign currencies | — | 2,655 | — | 17,341 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net change in unrealized appreciation | 17,672,034 | 17,269,664 | 95,556,132 | 13,948,978 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized and unrealized gain | 22,908,400 | 17,228,585 | 151,980,702 | 49,648,848 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | $ | 23,790,265 | $ | 17,681,493 | $ | 153,781,182 | $ | 64,808,182 | ||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 48 |
|
PowerShares Golden Dragon China Portfolio (PGJ) | PowerShares S&P 500 BuyWrite Portfolio (PBP) | PowerShares S&P 500® High Quality Portfolio (SPHQ) | PowerShares Water Resources Portfolio (PHO) | PowerShares WilderHill Clean Energy Portfolio (PBW) | PowerShares WilderHill Progressive Energy Portfolio (PUW) | |||||||||||||||||
$ | 2,729,481 | $ | 4,288,544 | $ | 6,298,880 | $ | 12,338,492 | $ | 698,706 | $ | 563,954 | |||||||||||
142 | 5,374 | 31 | 152 | 40 | 9 | |||||||||||||||||
1,298,528 | — | — | 14,481 | 3,958,531 | 61,106 | |||||||||||||||||
(149,261 | ) | (413 | ) | — | (382,994 | ) | (50,046 | ) | (24,209 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
3,878,890 | 4,293,505 | 6,298,911 | 11,970,131 | 4,607,231 | 600,860 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
1,338,196 | 1,519,471 | 846,041 | 4,714,658 | 1,025,445 | 202,387 | |||||||||||||||||
267,242 | — | 141,326 | 707,198 | 205,089 | 40,478 | |||||||||||||||||
53,101 | — | 57,359 | 184,732 | 41,333 | 36,058 | |||||||||||||||||
34,454 | — | 29,898 | 39,844 | 30,224 | 27,029 | |||||||||||||||||
29,064 | — | 11,107 | 67,094 | 81,977 | 8,011 | |||||||||||||||||
15,378 | — | 16,122 | 34,939 | 13,736 | 9,688 | |||||||||||||||||
107,774 | — | 8,564 | 3,672 | 18,608 | 5,294 | |||||||||||||||||
8,217 | — | — | — | 3,349 | — | |||||||||||||||||
19,760 | — | 22,640 | 18,535 | 15,903 | 10,359 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
1,873,186 | 1,519,471 | 1,133,057 | 5,770,672 | 1,435,664 | 339,304 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(1,209 | ) | (358 | ) | (287,217 | ) | (1,032 | ) | (271 | ) | (55,996 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
1,871,977 | 1,519,113 | 845,840 | 5,769,640 | 1,435,393 | 283,308 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
2,006,913 | 2,774,392 | 5,453,071 | 6,200,491 | 3,171,838 | 317,552 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(8,690,660 | ) | 2,884,582 | (119,745 | ) | 15,194,163 | (13,865,172 | ) | (941,321 | ) | |||||||||||||
— | — | — | — | — | — | |||||||||||||||||
— | (21,187,780 | ) | — | — | — | — | ||||||||||||||||
48,581,187 | 9,408,441 | 15,658,765 | 69,755,625 | 45,610,296 | 2,244,549 | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
39,890,527 | (8,894,757 | ) | 15,539,020 | 84,949,788 | 31,745,124 | 1,303,228 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
28,415,205 | 21,292,298 | 29,453,789 | 62,930,259 | 24,395,717 | 5,713,352 | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
— | 2,846,798 | — | — | — | — | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
28,415,205 | 24,139,096 | 29,453,789 | 62,930,259 | 24,395,717 | 5,713,352 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
68,305,732 | 15,244,339 | 44,992,809 | 147,880,047 | 56,140,841 | 7,016,580 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 70,312,645 | $ | 18,018,731 | $ | 50,445,880 | $ | 154,080,538 | $ | 59,312,679 | $ | 7,334,132 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| 49 |
|
Statements of Changes in Net Assets
For the years ended April 30, 2014 and 2013
PowerShares Aerospace & Defense Portfolio (PPA) | PowerShares CleantechTM Portfolio (PZD) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 881,865 | $ | 1,038,703 | $ | 452,908 | $ | 817,105 | ||||||||
Net realized gain (loss) | 5,236,366 | (893,302 | ) | (41,079 | ) | (4,786,886 | ) | |||||||||
Net increase from payment by affiliate | — | — | — | — | ||||||||||||
Net change in unrealized appreciation | 17,672,034 | 7,542,587 | 17,269,664 | 9,902,157 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from operations | 23,790,265 | 7,687,988 | 17,681,493 | 5,932,376 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (993,578 | ) | (1,029,052 | ) | (713,573 | ) | (712,757 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 48,361,326 | 998,228 | 1,498,269 | — | ||||||||||||
Value of shares repurchased | (20,678,371 | ) | (15,017,115 | ) | (5,244,820 | ) | (34,211,049 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | 27,682,955 | (14,018,887 | ) | (3,746,551 | ) | (34,211,049 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | 50,479,642 | (7,359,951 | ) | 13,221,369 | (28,991,430 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 47,606,585 | 54,966,536 | 71,314,049 | 100,305,479 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
End of year | $ | 98,086,227 | $ | 47,606,585 | $ | 84,535,418 | $ | 71,314,049 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Undistributed net investment income (loss) at end of year | $ | (15,632 | ) | $ | 82,701 | $ | 156,212 | $ | 297,136 | |||||||
|
|
|
|
|
|
|
| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 1,750,000 | 50,000 | 50,000 | �� | — | |||||||||||
Shares repurchased | (750,000 | ) | (750,000 | ) | (200,000 | ) | (1,550,000 | ) | ||||||||
Shares outstanding, beginning of year | 2,050,000 | 2,750,000 | 2,800,000 | 4,350,000 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding, end of year | 3,050,000 | 2,050,000 | 2,650,000 | 2,800,000 | ||||||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 50 |
|
PowerShares DWA Momentum Portfolio (PDP) | PowerShares Global Listed Private Equity Portfolio (PSP) | PowerShares Golden Dragon China Portfolio (PGJ) | ||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||
$ | 1,800,480 | $ | 5,543,441 | $ | 15,159,334 | $ | 7,617,711 | $ | 2,006,913 | $ | 3,494,223 | |||||||||||
56,424,570 | 74,176,381 | 35,699,870 | 17,590,747 | 39,890,527 | (63,947,150 | ) | ||||||||||||||||
— | — | — | — | — | 36,920 | |||||||||||||||||
95,556,132 | 33,244,128 | 13,948,978 | 63,857,819 | 28,415,205 | 41,814,758 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
153,781,182 | 112,963,950 | 64,808,182 | 89,066,277 | 70,312,645 | (18,601,249 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(3,053,165 | ) | (5,799,247 | ) | (65,805,444 | ) | (12,397,099 | ) | (2,898,245 | ) | (4,722,570 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
391,192,705 | 698,921,973 | 239,772,662 | 70,242,710 | 123,413,615 | 13,060,293 | |||||||||||||||||
(158,406,142 | ) | (500,235,301 | ) | (63,665,641 | ) | (35,164,174 | ) | (114,003,682 | ) | (53,830,199 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
232,786,563 | 198,686,672 | 176,107,021 | 35,078,536 | 9,409,933 | (40,769,906 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
383,514,580 | 305,851,375 | 175,109,759 | 111,747,714 | 76,824,333 | (64,093,725 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
876,928,963 | 571,077,588 | 408,491,507 | 296,743,793 | 181,744,241 | 245,837,966 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 1,260,443,543 | $ | 876,928,963 | $ | 583,601,266 | $ | 408,491,507 | $ | 258,568,574 | $ | 181,744,241 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | (31,513 | ) | $ | 386,768 | $ | (23,516,305 | ) | $ | 5,296,242 | $ | (1,293,541 | ) | $ | (733,516 | ) | |||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
11,150,000 | 24,850,000 | 20,100,000 | 6,400,000 | 4,350,000 | 700,000 | |||||||||||||||||
(4,650,000 | ) | (17,750,000 | ) | (5,500,000 | ) | (3,700,000 | ) | (4,250,000 | ) | (2,850,000 | ) | |||||||||||
27,600,000 | 20,500,000 | 34,900,000 | 32,200,000 | 9,250,000 | 11,400,000 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
34,100,000 | 27,600,000 | 49,500,000 | 34,900,000 | 9,350,000 | 9,250,000 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| 51 |
|
Statements of Changes in Net Assets (continued)
For the years ended April 30, 2014 and 2013
PowerShares S&P 500 BuyWrite Portfolio (PBP) | PowerShares S&P 500® High Quality Portfolio (SPHQ) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 2,774,392 | $ | 3,830,146 | $ | 5,453,071 | $ | 3,520,778 | ||||||||
Net realized gain (loss) | (8,894,757 | ) | 8,777,327 | 15,539,020 | 5,178,617 | |||||||||||
Net increase from payment by affiliate | — | — | — | — | ||||||||||||
Net change in unrealized appreciation | 24,139,096 | 406,705 | 29,453,789 | 24,339,195 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from operations | 18,018,731 | 13,014,178 | 50,445,880 | 33,038,590 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (12,551,907 | ) | (8,424,421 | ) | (5,320,142 | ) | (3,292,190 | ) | ||||||||
Net realized gains | (67,519 | ) | (2,056,844 | ) | — | — | ||||||||||
|
|
|
|
|
|
|
| |||||||||
(12,619,426 | ) | (10,481,265 | ) | (5,320,142 | ) | (3,292,190 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 72,951,504 | 155,680,453 | 137,479,261 | 76,363,194 | ||||||||||||
Value of shares repurchased | (34,114,213 | ) | (107,519,457 | ) | (45,654,865 | ) | (23,794,170 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | 38,837,291 | 48,160,996 | 91,824,396 | 52,569,024 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | 44,236,596 | 50,693,909 | 136,950,134 | 82,315,424 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 205,221,829 | 154,527,920 | 228,736,069 | 146,420,645 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
End of year | $ | 249,458,425 | $ | 205,221,829 | $ | 365,686,203 | $ | 228,736,069 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Undistributed net investment income (loss) at end of year | $ | 492,190 | $ | 513,869 | $ | 660,203 | $ | 527,274 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 3,500,000 | 7,650,000 | 7,000,000 | 4,700,000 | ||||||||||||
Shares repurchased | (1,650,000 | ) | (5,300,000 | ) | (2,300,000 | ) | (1,450,000 | ) | ||||||||
Shares outstanding, beginning of year | 9,850,000 | 7,500,000 | 12,800,000 | 9,550,000 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding, end of year | 11,700,000 | 9,850,000 | 17,500,000 | 12,800,000 | ||||||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 52 |
|
PowerShares Water Resources Portfolio (PHO) | PowerShares WilderHill Clean Energy Portfolio (PBW) | PowerShares WilderHill Progressive Energy Portfolio (PUW) | ||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||
$ | 6,200,491 | $ | 6,573,110 | $ | 3,171,838 | $ | 3,362,695 | $ | 317,552 | $ | 550,558 | |||||||||||
84,949,788 | (8,583,436 | ) | 31,745,124 | (138,364,257 | ) | 1,303,228 | 757,073 | |||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
62,930,259 | 137,318,912 | 24,395,717 | 125,881,934 | 5,713,352 | 791,507 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
154,080,538 | 135,308,586 | 59,312,679 | (9,119,628 | ) | 7,334,132 | 2,099,138 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(5,035,124 | ) | (6,646,911 | ) | (5,058,769 | ) | (4,631,864 | ) | (473,310 | ) | (318,497 | ) | |||||||||||
— | — | — | — | — | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(5,035,124 | ) | (6,646,911 | ) | (5,058,769 | ) | (4,631,864 | ) | (473,310 | ) | (318,497 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
157,626,289 | 53,224,195 | 125,579,841 | 24,870,370 | 5,983,872 | — | |||||||||||||||||
(193,488,911 | ) | (130,331,858 | ) | (104,226,358 | ) | (46,640,787 | ) | (5,609,711 | ) | (11,055,489 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(35,862,622 | ) | (77,107,663 | ) | 21,353,483 | (21,770,417 | ) | 374,161 | (11,055,489 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
113,182,792 | 51,554,012 | 75,607,393 | (35,521,909 | ) | 7,234,983 | (9,274,848 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
877,064,295 | 825,510,283 | 142,493,831 | 178,015,740 | 38,584,123 | 47,858,971 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 990,247,087 | $ | 877,064,295 | $ | 218,101,224 | $ | 142,493,831 | $ | 45,819,106 | $ | 38,584,123 | |||||||||||
|
|
|
|
|
|
|
|
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$ | 2,193,553 | $ | 1,028,186 | $ | (336,558 | ) | $ | 1,366,484 | $ | 70,727 | $ | 226,485 | ||||||||||
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6,100,000 | 2,550,000 | 20,650,000 | 5,500,000 | 200,000 | — | |||||||||||||||||
(7,650,000 | ) | (6,750,000 | ) | (17,300,000 | ) | (10,800,000 | ) | (200,000 | ) | (450,000 | ) | |||||||||||
39,750,000 | 43,950,000 | 29,750,000 | 35,050,000 | 1,400,000 | 1,850,000 | |||||||||||||||||
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38,200,000 | 39,750,000 | 33,100,000 | 29,750,000 | 1,400,000 | 1,400,000 | |||||||||||||||||
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| 53 |
|
PowerShares Aerospace & Defense Portfolio (PPA)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 23.22 | $ | 19.99 | $ | 20.57 | $ | 19.07 | $ | 13.38 | ||||||||||
Net investment income(a) | 0.33 | 0.44 | 0.21 | 0.18 | 0.17 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 9.00 | 3.22 | (0.60 | ) | 1.49 | 5.73 | ||||||||||||||
Total from investment operations | 9.33 | 3.66 | (0.39 | ) | 1.67 | 5.90 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.39 | ) | (0.43 | ) | (0.19 | ) | (0.17 | ) | (0.21 | ) | ||||||||||
Net asset value at end of year | $ | 32.16 | $ | 23.22 | $ | 19.99 | $ | 20.57 | $ | 19.07 | ||||||||||
Market price at end of year(b) | $ | 32.15 | �� | $ | 23.20 | $ | 19.98 | $ | 20.57 | $ | 19.07 | |||||||||
Net Asset Value Total Return(c) | 40.52 | % | 18.69 | % | (1.82 | )% | 8.91 | % | 44.36 | % | ||||||||||
Market Price Total Return(c) | 40.59 | % | 18.65 | % | (1.87 | )% | 8.91 | % | 44.47 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 98,086 | $ | 47,607 | $ | 54,967 | $ | 107,971 | $ | 137,338 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.66 | % | 0.66 | % | 0.66 | % | 0.66 | % | 0.66 | % | ||||||||||
Expenses, prior to Waivers | 0.69 | % | 0.74 | % | 0.76 | % | 0.73 | % | 0.69 | % | ||||||||||
Net investment income, after Waivers | 1.13 | % | 2.18 | % | 1.09 | % | 0.99 | % | 1.08 | % | ||||||||||
Portfolio turnover rate(d) | 8 | % | 17 | % | 25 | % | 12 | % | 17 | % |
PowerShares CleantechTM Portfolio (PZD)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 25.47 | $ | 23.06 | $ | 30.10 | $ | 25.00 | $ | 19.25 | ||||||||||
Net investment income (loss)(a) | 0.17 | 0.26 | 0.24 | 0.06 | 0.03 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 6.53 | 2.37 | (7.07 | ) | 5.05 | 5.77 | ||||||||||||||
Total from investment operations | 6.70 | 2.63 | (6.83 | ) | 5.11 | 5.80 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.27 | ) | (0.22 | ) | (0.21 | ) | (0.01 | ) | (0.04 | ) | ||||||||||
Return of capital | — | — | — | — | (0.01 | ) | ||||||||||||||
Total distributions | (0.27 | ) | (0.22 | ) | (0.21 | ) | (0.01 | ) | (0.05 | ) | ||||||||||
Net asset value at end of year | $ | 31.90 | $ | 25.47 | $ | 23.06 | $ | 30.10 | $ | 25.00 | ||||||||||
Market price at end of year(b) | $ | 31.92 | $ | 25.36 | $ | 22.98 | $ | 30.08 | $ | 24.80 | ||||||||||
Net Asset Value Total Return(c) | 26.52 | % | 11.59 | % | (22.65 | )% | 20.43 | % | 30.16 | % | ||||||||||
Market Price Total Return(c) | 27.15 | % | 11.50 | % | (22.87 | )% | 21.32 | % | 28.45 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 84,535 | $ | 71,314 | $ | 100,305 | $ | 162,530 | $ | 160,021 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.67 | % | 0.67 | % | 0.67 | % | 0.67 | % | 0.67 | % | ||||||||||
Expenses, prior to Waivers | 0.72 | % | 0.76 | % | 0.74 | % | 0.74 | % | 0.71 | % | ||||||||||
Net investment income, after Waivers | 0.58 | % | 1.16 | % | 0.97 | % | 0.22 | % | 0.11 | % | ||||||||||
Portfolio turnover rate(d) | 24 | % | 22 | % | 27 | % | 24 | % | 31 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 54 |
|
Financial Highlights (continued)
PowerShares DWA Momentum Portfolio (PDP)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 31.77 | $ | 27.86 | $ | 26.52 | $ | 21.25 | $ | 14.14 | ||||||||||
Net investment income(a) | 0.06 | 0.23 | 0.07 | 0.04 | 0.06 | |||||||||||||||
Net realized and unrealized gain on investments | 5.23 | 3.92 | 1.31 | 5.29 | 7.15 | |||||||||||||||
Total from investment operations | 5.29 | 4.15 | 1.38 | 5.33 | 7.21 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.10 | ) | (0.24 | ) | (0.04 | ) | (0.06 | ) | (0.10 | ) | ||||||||||
Net asset value at end of year | $ | 36.96 | $ | 31.77 | $ | 27.86 | $ | 26.52 | $ | 21.25 | ||||||||||
Market price at end of year(b) | $ | 36.93 | $ | 31.76 | $ | 27.86 | $ | 26.54 | $ | 21.24 | ||||||||||
Net Asset Value Total Return(c) | 16.71 | % | 15.02 | % | 5.22 | % | 25.11 | % | 51.28 | % | ||||||||||
Market Price Total Return(c) | 16.65 | % | 14.98 | % | 5.15 | % | 25.26 | % | 51.31 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 1,260,444 | $ | 876,929 | $ | 571,078 | $ | 450,904 | $ | 159,371 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | %(d) | 0.67 | %(d) | 0.65 | % | 0.70 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers | 0.64 | %(d) | 0.67 | %(d) | 0.65 | % | 0.71 | % | 0.73 | % | ||||||||||
Net investment income, after Waivers | 0.17 | % | 0.82 | % | 0.29 | % | 0.19 | % | 0.35 | % | ||||||||||
Portfolio turnover rate(e) | 75 | % | 66 | % | 96 | % | 42 | % | 52 | % |
PowerShares Global Listed Private Equity Portfolio (PSP)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 11.70 | $ | 9.22 | $ | 12.17 | $ | 10.04 | $ | 6.72 | ||||||||||
Net investment income(a) | 0.38 | (f) | 0.24 | 0.26 | 0.26 | 0.33 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 1.38 | 2.64 | (2.58 | ) | 2.41 | 3.27 | ||||||||||||||
Total from investment operations | 1.76 | 2.88 | (2.32 | ) | 2.67 | 3.60 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (1.67 | ) | (0.40 | ) | (0.56 | ) | (0.54 | ) | (0.28 | ) | ||||||||||
Return of capital | — | — | (0.07 | ) | — | — | ||||||||||||||
Total distributions | (1.67 | ) | (0.40 | ) | (0.63 | ) | (0.54 | ) | (0.28 | ) | ||||||||||
Net asset value at end of year | $ | 11.79 | $ | 11.70 | $ | 9.22 | $ | 12.17 | $ | 10.04 | ||||||||||
Market price at end of year(b) | $ | 11.85 | $ | 11.75 | $ | 9.25 | $ | 12.25 | $ | 10.06 | ||||||||||
Net Asset Value Total Return(c) | 16.20 | % | 31.87 | % | (19.51 | )% | 27.93 | % | 54.20 | % | ||||||||||
Market Price Total Return(c) | 16.31 | % | 32.00 | % | (19.80 | )% | 28.48 | % | 54.70 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 583,601 | $ | 408,492 | $ | 296,744 | $ | 493,622 | $ | 211,879 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers(d) | 0.69 | % | 0.70 | % | 0.71 | % | 0.70 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers(d) | 0.70 | % | 0.70 | % | 0.76 | % | 0.73 | % | 0.72 | % | ||||||||||
Net investment income, after Waivers | 3.20 | %(f) | 2.47 | % | 2.79 | % | 2.50 | % | 3.66 | %(g) | ||||||||||
Portfolio turnover rate(e) | 53 | % | 53 | % | 88 | % | 112 | % | 121 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the investment companies in which the Fund invests. Estimated investment company expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the investment companies and are deducted from the value of the funds that the Fund invests in. The effect of the estimated investment company expenses that you bear indirectly is included in the Fund’s total return. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(f) | Net Investment income per share and the ratio of net investment income to average net assets include a significant dividend received during the year. Net investment income per share and the ratio of net investment income to average net assets excluding the significant dividends are $0.28 and 2.39%, respectively. |
(g) | Net investment income per share and the ratio of net investment income to average net assets include a special stock dividend in which the Fund elected a cash payment of $0.96 per share owned of American Capital Ltd. on August 7, 2009. Net investment income per share and the ratio of net investment income to average net assets excluding the special dividend are $0.27 and 2.94%, respectively. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 55 |
|
Financial Highlights (continued)
PowerShares Golden Dragon China Portfolio (PGJ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 19.65 | $ | 21.56 | $ | 28.98 | $ | 25.03 | $ | 17.47 | ||||||||||
Net investment income(a) | 0.21 | 0.34 | 0.48 | 0.21 | 0.13 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 8.08 | (1.81 | ) | (7.43 | ) | 3.92 | 7.63 | |||||||||||||
Total from investment operations | 8.29 | (1.47 | ) | (6.95 | ) | 4.13 | 7.76 | |||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.29 | ) | (0.44 | ) | (0.47 | ) | (0.18 | ) | (0.17 | ) | ||||||||||
Return of capital | — | — | — | — | (0.03 | ) | ||||||||||||||
Total distributions | (0.29 | ) | (0.44 | ) | (0.47 | ) | (0.18 | ) | (0.20 | ) | ||||||||||
Net asset value at end of year | $ | 27.65 | $ | 19.65 | $ | 21.56 | $ | 28.98 | $ | 25.03 | ||||||||||
Market price at end of year(b) | $ | 27.60 | $ | 19.59 | $ | 21.49 | $ | 28.87 | $ | 25.04 | ||||||||||
Net Asset Value Total Return(c) | 42.28 | % | (6.73 | )%(d) | (23.98 | )% | 16.60 | % | 44.51 | % | ||||||||||
Market Price Total Return(c) | 42.46 | % | (6.70 | )% | (23.93 | )% | 16.11 | % | 44.49 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 258,569 | $ | 181,744 | $ | 245,838 | $ | 446,292 | $ | 455,523 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.70 | % | 0.70 | % | 0.69 | % | 0.70 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers | 0.70 | % | 0.75 | % | 0.71 | % | 0.72 | % | 0.71 | % | ||||||||||
Net investment income, after Waivers | 0.75 | % | 1.78 | % | 2.08 | % | 0.82 | % | 0.56 | % | ||||||||||
Portfolio turnover rate(e) | 37 | % | 63 | % | 23 | % | 15 | % | 35 | % |
PowerShares S&P 500 BuyWrite Portfolio (PBP)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 20.83 | $ | 20.60 | $ | 21.52 | $ | 21.52 | $ | 17.54 | ||||||||||
Net investment income(a) | 0.28 | 0.33 | 0.29 | 0.29 | 0.27 | |||||||||||||||
Net realized and unrealized gain on investments | 1.57 | 0.70 | 1.00 | 1.34 | 4.00 | |||||||||||||||
Total from investment operations | 1.85 | 1.03 | 1.29 | 1.63 | 4.27 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (1.35 | ) | (0.65 | ) | (2.10 | ) | (0.27 | ) | (0.29 | ) | ||||||||||
Net realized gains | (0.01 | ) | (0.15 | ) | (0.11 | ) | (1.36 | ) | — | |||||||||||
Total distributions | (1.36 | ) | (0.80 | ) | (2.21 | ) | (1.63 | ) | (0.29 | ) | ||||||||||
Net asset value at end of year | $ | 21.32 | $ | 20.83 | $ | 20.60 | $ | 21.52 | $ | 21.52 | ||||||||||
Market price at end of year(b) | $ | 21.35 | $ | 20.83 | $ | 20.65 | $ | 21.52 | $ | 21.52 | ||||||||||
Net Asset Value Total Return(c) | 9.34 | % | 5.22 | % | 6.74 | % | 8.11 | % | 24.48 | % | ||||||||||
Market Price Total Return(c) | 9.50 | % | 4.97 | % | 7.02 | % | 8.09 | % | 24.11 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 249,458 | $ | 205,222 | $ | 154,528 | $ | 120,511 | $ | 167,840 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | ||||||||||
Net investment income | 1.37 | % | 1.61 | % | 1.42 | % | 1.37 | % | 1.35 | % | ||||||||||
Portfolio turnover rate(e) | 32 | % | 22 | % | 58 | % | 61 | % | 51 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Amount includes the effect of the Adviser pay-in for an economic loss of $0.004 per share. Had the pay-in not been made, the net asset value total return would have been (6.77)%. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 56 |
|
Financial Highlights (continued)
PowerShares S&P 500® High Quality Portfolio (SPHQ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 17.87 | $ | 15.33 | $ | 14.64 | $ | 12.21 | $ | 9.60 | ||||||||||
Net investment income(a) | 0.36 | 0.33 | 0.26 | 0.20 | 0.00 | (b) | ||||||||||||||
Net realized and unrealized gain on investments | 3.03 | 2.52 | 0.74 | 2.31 | 2.64 | |||||||||||||||
Total from investment operations | 3.39 | 2.85 | 1.00 | 2.51 | 2.64 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.36 | ) | (0.31 | ) | (0.31 | ) | (0.08 | ) | (0.03 | ) | ||||||||||
Net asset value at end of year | $ | 20.90 | $ | 17.87 | $ | 15.33 | $ | 14.64 | $ | 12.21 | ||||||||||
Market price at end of year(c) | $ | 20.89 | $ | 17.87 | $ | 15.33 | $ | 14.64 | $ | 12.21 | ||||||||||
Net Asset Value Total Return(d) | 19.15 | % | 18.86 | % | 7.04 | % | 20.61 | % | 27.63 | % | ||||||||||
Market Price Total Return(d) | 19.09 | % | 18.86 | % | 7.04 | % | 20.61 | % | 27.63 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 365,686 | $ | 228,736 | $ | 146,421 | $ | 112,695 | $ | 67,746 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.29 | % | 0.39 | % | 0.50 | % | 0.52 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers | 0.39 | % | 0.55 | % | 0.70 | % | 0.84 | % | 0.80 | % | ||||||||||
Net investment income (loss), after Waivers | 1.87 | % | 2.06 | % | 1.82 | % | 1.49 | % | (0.03 | )% | ||||||||||
Portfolio turnover rate(e) | 13 | % | 17 | % | 14 | % | 64 | % | 138 | % |
PowerShares Water Resources Portfolio (PHO)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 22.06 | $ | 18.78 | $ | 20.25 | $ | 18.05 | $ | 14.04 | ||||||||||
Net investment income(a) | 0.16 | 0.16 | 0.14 | 0.11 | 0.09 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 3.83 | 3.28 | (1.48 | ) | 2.19 | 4.03 | ||||||||||||||
Total from investment operations | 3.99 | 3.44 | (1.34 | ) | 2.30 | 4.12 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.13 | ) | (0.16 | ) | (0.13 | ) | (0.10 | ) | (0.11 | ) | ||||||||||
Net asset value at end of year | $ | 25.92 | $ | 22.06 | $ | 18.78 | $ | 20.25 | $ | 18.05 | ||||||||||
Market price at end of year(c) | $ | 25.91 | $ | 22.05 | $ | 18.77 | $ | 20.24 | $ | 18.05 | ||||||||||
Net Asset Value Total Return(d) | 18.16 | % | 18.48 | % | (6.59 | )% | 12.81 | % | 29.48 | % | ||||||||||
Market Price Total Return(d) | 18.17 | % | 18.49 | % | (6.59 | )% | 12.75 | % | 29.67 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 990,247 | $ | 877,064 | $ | 825,510 | $ | 1,260,648 | $ | 1,335,033 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.61 | % | 0.62 | % | 0.62 | % | 0.66 | % | 0.64 | % | ||||||||||
Expenses, prior to Waivers | 0.61 | % | 0.62 | % | 0.62 | % | 0.66 | % | 0.64 | % | ||||||||||
Net investment income, after Waivers | 0.66 | % | 0.81 | % | 0.77 | % | 0.63 | % | 0.57 | % | ||||||||||
Portfolio turnover rate(e) | 34 | % | 31 | % | 44 | % | 13 | % | 20 | % |
(a) | Based on average shares outstanding. |
(b) | Amount represents less than $0.005. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 57 |
|
Financial Highlights (continued)
PowerShares WilderHill Clean Energy Portfolio (PBW)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 4.79 | $ | 5.08 | $ | 10.35 | $ | 10.12 | $ | 9.03 | ||||||||||
Net investment income (loss)(a) | 0.10 | 0.11 | 0.20 | (0.03 | ) | (0.02 | ) | |||||||||||||
Net realized and unrealized gain (loss) on investments | 1.85 | (0.26 | ) | (5.33 | ) | 0.26 | 1.11 | |||||||||||||
Total from investment operations | 1.95 | (0.15 | ) | (5.13 | ) | 0.23 | 1.09 | |||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.15 | ) | (0.14 | ) | (0.14 | ) | — | — | ||||||||||||
Net asset value at end of year | $ | 6.59 | $ | 4.79 | $ | 5.08 | $ | 10.35 | $ | 10.12 | ||||||||||
Market price at end of year(b) | $ | 6.59 | $ | 4.79 | $ | 5.08 | $ | 10.33 | $ | 10.11 | ||||||||||
Net Asset Value Total Return(c) | 41.23 | % | (2.64 | )% | (49.78 | )% | 2.27 | % | 12.07 | % | ||||||||||
Market Price Total Return(c) | 41.23 | % | (2.65 | )% | (49.68 | )% | 2.18 | % | 12.46 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 218,101 | $ | 142,494 | $ | 178,016 | $ | 541,472 | $ | 657,486 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.70 | % | 0.70 | % | 0.70 | % | 0.70 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers | 0.70 | % | 0.70 | % | 0.76 | % | 0.75 | % | 0.70 | % | ||||||||||
Net investment income (loss), after Waivers | 1.55 | % | 2.48 | % | 2.98 | % | (0.27 | )% | (0.18 | )% | ||||||||||
Portfolio turnover rate(d) | 57 | % | 52 | % | 46 | % | 32 | % | 42 | % |
PowerShares WilderHill Progressive Energy Portfolio (PUW)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 27.56 | $ | 25.87 | $ | 30.68 | $ | 25.19 | $ | 17.38 | ||||||||||
Net investment income(a) | 0.24 | 0.35 | 0.14 | 0.10 | 0.14 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 5.27 | 1.54 | (4.71 | ) | 5.53 | 7.81 | ||||||||||||||
Total from investment operations | 5.51 | 1.89 | (4.57 | ) | 5.63 | 7.95 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.34 | ) | (0.20 | ) | (0.24 | ) | (0.14 | ) | (0.14 | ) | ||||||||||
Net asset value at end of year | $ | 32.73 | $ | 27.56 | $ | 25.87 | $ | 30.68 | $ | 25.19 | ||||||||||
Market price at end of year(b) | $ | 32.71 | $ | 27.55 | $ | 25.86 | $ | 30.70 | $ | 25.19 | ||||||||||
Net Asset Value Total Return(c) | 20.24 | % | 7.38 | % | (14.84 | )% | 22.47 | % | 45.96 | % | ||||||||||
Market Price Total Return(c) | 20.21 | % | 7.38 | % | (14.93 | )% | 22.55 | % | 45.96 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 45,819 | $ | 38,584 | $ | 47,859 | $ | 75,175 | $ | 60,451 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.70 | % | 0.70 | % | 0.71 | % | 0.70 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers | 0.84 | % | 0.87 | % | 0.86 | % | 0.86 | % | 0.84 | % | ||||||||||
Net investment income, after Waivers | 0.78 | % | 1.40 | % | 0.56 | % | �� | 0.37 | % | 0.63 | % | |||||||||
Portfolio turnover rate(d) | 37 | % | 32 | % | 36 | % | 22 | % | 52 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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PowerShares Exchange-Traded Fund Trust
April 30, 2014
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the “Trust”) was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). As of April 30, 2014, the Trust offered fifty-three portfolios. This report includes the following portfolios:
Full Name | Short Name | |
PowerShares Aerospace & Defense Portfolio (PPA) | “Aerospace & Defense Portfolio” | |
PowerShares CleantechTM Portfolio (PZD) | “CleantechTM Portfolio” | |
PowerShares DWA Momentum Portfolio (PDP) (formerly PowerShares DWA Technical LeadersTM Portfolio) | “DWA Momentum Portfolio” | |
PowerShares Global Listed Private Equity Portfolio (PSP) | “Global Listed Private Equity Portfolio” | |
PowerShares Golden Dragon China Portfolio (PGJ) | “Golden Dragon China Portfolio” | |
PowerShares S&P 500 BuyWrite Portfolio (PBP) | “S&P 500 BuyWrite Portfolio” | |
PowerShares S&P 500® High Quality Portfolio (SPHQ) | “S&P 500® High Quality Portfolio” | |
PowerShares Water Resources Portfolio (PHO) | “Water Resources Portfolio” | |
PowerShares WilderHill Clean Energy Portfolio (PBW) | “WilderHill Clean Energy Portfolio” | |
PowerShares WilderHill Progressive Energy Portfolio (PUW) | “WilderHill Progressive Energy Portfolio” |
Each portfolio (each, a “Fund”, and collectively, the “Funds”) represents a separate series of the Trust. The shares of the Funds are referred to herein as “Shares” or “Fund’s Shares.” Each Fund’s Shares are listed and traded on NYSE Arca, Inc.
The market prices of each Fund’s Shares may differ to some degree from the Fund’s net asset value (“NAV”). Unlike conventional mutual funds, each Fund issues and redeems Shares on a continuous basis, at NAV, only in a large specified number of Shares, each called a “Creation Unit.” Creation Units are issued and redeemed in exchange for the deposit or delivery of a basket of securities (“Deposit Securities”). Except when aggregated in Creation Units by Authorized Participants, the Shares are not individually redeemable securities of the Funds.
The investment objective of each Fund is to seek investment results that generally correspond (before fees and expenses) to the price and yield of its respective index listed below (each, an “Underlying Index”):
Fund | Underlying Index | |
Aerospace & Defense Portfolio | SPADETM Defense Index | |
CleantechTM Portfolio | The Cleantech IndexTM | |
DWA Momentum Portfolio | Dorsey Wright Technical LeadersTM Index | |
Global Listed Private Equity Portfolio | Red Rocks Global Listed Private Equity Index | |
Golden Dragon China Portfolio | NASDAQ Golden Dragon China Index | |
S&P 500 BuyWrite Portfolio | CBOE S&P 500 BuyWrite IndexTM | |
S&P 500® High Quality Portfolio | S&P 500® High Quality Rankings Index | |
Water Resources Portfolio | NASDAQ OMX US Water IndexSM | |
WilderHill Clean Energy Portfolio | WilderHill Clean Energy Index | |
WilderHill Progressive Energy Portfolio | WilderHill Progressive Energy Index |
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates. In addition, the Funds monitor for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policies.
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A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and ask prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and ask prices. For purposes of determining NAV per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end of day NAV per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Securities with a demand feature exercisable within one to seven days are valued at par. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that Invesco PowerShares Capital Management LLC (the “Adviser”) determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American depositary receipts (“ADRs”) and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Swap agreements are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end of day net present values, spreads, ratings, industry, and company performance.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith following procedures approved by the Board of Trustees. Issuer-specific events, market trends, bid/ask quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
Each Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain of each Fund’s investments.
Valuations change in response to many factors, including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. Other Risks
Index Risk. Unlike many investment companies, the Funds do not utilize investing strategies that seek returns in excess of their Underlying Indexes. Therefore, a Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its respective Underlying Index, even if that security generally is underperforming.
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Equity Risk. Equity risk is the risk that the value of the securities that each Fund holds will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities a Fund holds participate or factors relating to specific companies in which the Funds invest. For example, an adverse event, such as an unfavorable earnings report, may depress the value of securities a Fund holds; the price of securities may be particularly sensitive to general movements in the stock market; or a drop in the stock market may depress the price of most or all of the securities a Fund holds. In addition, securities of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition.
Industry Concentration Risk. In following its methodology, each Fund’s Underlying Index from time to time may be concentrated to a significant degree in securities of issuers located in a single industry or a sector. To the extent that an Underlying Index concentrates in the securities of issuers in a particular industry or sector, each Fund will also concentrate its investments to approximately the same extent. By concentrating its investments in an industry or sector, a Fund may face more risks than if it were diversified broadly over numerous industries or sectors. In addition, at times, an industry or sector may be out of favor and underperform other industries or the market as a whole. Any factors detrimental to the performance of such industry or sector will disproportionately impact a Fund’s NAV.
Non-Correlation Risk. Each Fund’s return may not match the return of its Underlying Index for a number of reasons. For example, each Fund incurs operating expenses not applicable to its Underlying Index, and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of its Underlying Index. In addition, the performance of each Fund and its Underlying Index may vary due to asset valuation differences and differences between each Fund’s portfolio and its Underlying Index resulting from legal restrictions, cost or liquidity constraints.
Non-Diversified Fund Risk. Each Fund (except for CleantechTM Portfolio, DWA Momentum Portfolio, Global Listed Private Equity Portfolio, S&P 500 BuyWrite Portfolio, S&P 500® High Quality Portfolio, WilderHill Clean Energy Portfolio and WilderHill Progressive Energy Portfolio) is non-diversified and can invest a greater portion of its assets in securities of individual issuers than diversified funds. As a result, changes in the market value of a single investment could cause greater fluctuations in Share price than would occur in a diversified fund. This may increase a Fund’s volatility and cause the performance of a relatively small number of issuers to have a greater impact on a Fund’s performance.
Small and Medium Capitalization Company Risk. Investing in securities of small and medium capitalization companies involves greater risk than customarily is associated with investing in larger, more established companies. These companies’ securities may be more volatile and less liquid than those of more established companies. These securities may have returns that vary, sometimes significantly, from the overall securities market. Often small and medium capitalization companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.
Foreign Investment Risk. For CleantechTM Portfolio, investments in the securities of non-U.S. issuers involve risks beyond those associated with investments in U.S. securities. Foreign securities may have relatively low market liquidity, greater market volatility, decreased publicly available information and less reliable financial information about issuers. Foreign securities also are subject to the risks of expropriation, nationalization, political instability, local taxation, potential currency transfer restrictions or other adverse political or economic developments and the difficulty of enforcing obligations in other countries. As the Fund may invest in securities denominated in foreign currencies, fluctuations in the value of the U.S. dollar relative to the values of other currencies may adversely affect investments in foreign securities and may negatively impact the Fund’s returns.
Foreign Securities Risk. For Global Listed Private Equity Portfolio, since the Underlying Index may include ADRs and global depositary receipts (“GDRs”), The Fund’s involve risks of investing in foreign securities, in addition to the risks associated with domestic securities. In general, foreign companies are not subject to the regulatory requirements of U.S. companies and, as such, there may be less publicly available information about these companies. Moreover, foreign companies often are subject to less stringent requirements regarding accounting, auditing, financial reporting and record-keeping than are U.S. companies. Therefore, not all material information regarding these companies will be available.
Risk of Investing in Listed Private Equity Companies. For Global Listed Private Equity Portfolio, there are certain risks inherent in investing in listed private equity companies, which encompass BDCs and other financial institutions or vehicles whose principal business is to invest in and lend capital to, or provide services to privately held companies. The 1940 Act imposes certain restraints upon the operations of business development companies (“BDCs”). For example, BDCs are required to invest at least 70% of their total assets primarily in securities of private companies or thinly traded U.S. public companies, cash, cash equivalents, U.S. government securities and high quality debt investments that mature in one year or less. Generally, little public information exists for private and thinly traded companies, and there is a risk that investors may not be able to make a fully informed investment decision. With investments in debt instruments, there is a risk that the issuer may default on its payments or declare bankruptcy. Additionally, a BDC may incur indebtedness only in amounts such that the BDC’s asset coverage equals at least 200% after such incurrence. These limitations on asset mix and leverage may prohibit the way that the BDC raises capital. BDCs generally invest in less mature private companies, which involve greater risk than well-established, publicly-traded companies.
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C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and to distribute substantially all of the Fund’s taxable earnings to its shareholders. As such, the Funds will not be subject to federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements.
Each Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed each Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months
Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These timing differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and passive foreign investment company adjustments, if any.
The Funds file U.S. federal tax returns and tax returns in certain other jurisdictions. Generally, a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Transactions and Investment Income
Investment transactions are accounted for on a trade date basis. Realized gains and losses from the sale or disposition of securities are computed on the specific identified cost basis. Interest income is recorded on the accrual basis. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. Realized gains, dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date.
E. Expenses
Expenses of the Trust that are directly identifiable to a specific Fund are applied to that Fund. Expenses of the Trust that are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund (except for S&P 500 BuyWrite Portfolio) is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, sub-licensing fees related to its respective Underlying Index, any distribution fees or expenses, litigation expenses, fees payable to the Trust’s Board members who are not “interested persons” (as defined in the 1940 Act) of the Trust (the “Independent Trustees”) or the Adviser, expenses incurred in connection with the Board members’ services, including travel expenses and legal fees of counsel for the Independent Trustees, acquired fund fees and expenses, if any, and extraordinary expenses.
The S&P 500 BuyWrite Portfolio has agreed to pay an annual unitary management fee to the Adviser. Out of the unitary management fee, the Adviser has agreed to pay for substantially all expenses of the Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for advisory fees, distribution fees, if any, brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses (including acquired fund fees and expenses, if any).
To the extent a Fund invests in other investment companies, the expenses shown in the accompanying financial statements reflect the expenses of the Fund and do not include any expenses of the investment companies in which it invests. The effects of such investment companies’ expenses are included in the realized and unrealized gain or loss on the investments in the investment companies.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and records such dividends on ex-dividend date. Generally, each Fund distributes net realized taxable capital gains, if any, annually in cash and records them on ex-dividend date. Such distributions on a tax basis are determined in conformity with federal income tax regulations, which may differ from GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund’s financial statements as a tax return of capital at fiscal period-end.
G. Option Contracts Written
S&P 500 BuyWrite Portfolio may engage in certain strategies involving options to manage or minimize the risk of its investments or for investment purposes. A call option gives the purchaser of such option the right to buy, and the writer (the Fund) the obligation to sell, the underlying security at the stated exercise price during the option period. When the Fund writes (sells) call options, the amount of the premium received is recorded as a liability in the Statements of Assets and Liabilities and is subsequently “marked-to-market” to reflect the current value of the option written. The difference between the premium received and the current value of the option is recorded as
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unrealized appreciation or depreciation. The net change in unrealized appreciation (depreciation) is reported in the Statements of Operations. If a written call option expires, or if the Fund enters into a closing purchase transaction, the Fund realizes a gain (or a loss if the closing purchase transaction exceeds the premium received when the option was written) without regard to any unrealized gain or loss on the underlying security, and the liability related to such option is extinguished. If a written option is exercised, the Fund realizes a gain or loss from the sale of the underlying security and the proceeds of the sale are increased by the premium originally received. The primary risk in writing a call option is market risk; the Fund gives up the opportunity for profit if the market price of the underlying security increases and the option is exercised but will continue to bear the risk of loss should the price of the underlying security decline. There is also a risk the Fund may not be able to enter into a closing transaction because of an illiquid market.
Writing Covered Call Option Risk. By writing covered call options in return for the receipt of premiums, the S&P 500 BuyWrite Portfolio will give up the opportunity to benefit from potential increases in the value of the S&P 500® Index above the exercise prices of the Written Options, but will continue to bear the risk of declines in the value of the S&P 500® Index. The premiums received from the options may not be sufficient to offset any losses sustained from the volatility of the underlying stocks over time. In addition, the Fund’s ability to sell the underlying securities will be limited while the option is in effect unless the Fund extinguishes the option position through the purchase of an offsetting identical option prior to the expiration of the written option. If trading of options is suspended, the Fund may be unable to write options at times that may be desirable or advantageous to the Fund to do so.
H. Swap Agreements
Global Listed Private Equity Portfolio may enter into various swap transactions, including interest rate, total return, index, currency exchange rate and credit default swap contracts for investment purposes or to manage interest rate, currency or credit risk.
Interest rate, total return, index, and currency exchange rate swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, (i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index).
Changes in the value of swap agreements are recognized as unrealized gains (losses) in the Statements of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Statements of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss), on the Statements of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Statements of Operations. The Fund segregates liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. The Fund’s maximum risk of loss from counterparty risk, either as the protection seller or as the protection buyer, is the value of the contract. The risk may be mitigated by having a master netting arrangement between the Fund and the counterparty and by the posting of collateral by the counterparty to cover the Fund’s exposure to the counterparty. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and counterparty risk in excess of amounts recognized on the Statements of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations.
I. Securities Lending
CleantechTM Portfolio, Global Listed Private Equity Portfolio, Golden Dragon China Portfolio, Water Resources Portfolio, WilderHill Clean Energy Portfolio and WilderHill Progressive Energy Portfolio participated in securities lending. Each Fund loaned portfolio securities having a market value up to one-third of each Fund’s total assets. Such loans are secured by cash collateral equal to no less than 102% of the market value of the loaned securities determined daily by the securities lending provider. Cash collateral received in connection with these loans is invested in an affiliated money market fund and is shown as such on the Schedule of Investments. It is the policy of these Funds to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to a Fund if, and to the extent that, the market value of the securities loaned were to increase, and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. A Fund could experience delays and costs in gaining access to the collateral. A Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Securities lending income on the Statements of Operations. The aggregate value of securities out on loan is shown on the Statements of Assets and Liabilities, if any. Water Resources no longer participates in securities lending.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser, pursuant to which the Adviser has overall responsibility for the selection and ongoing monitoring of the Funds’ investments, managing the Funds’ business affairs and providing certain clerical,
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bookkeeping and other administrative services. Each Fund (except for S&P 500 BuyWrite Portfolio and S&P 500® High Quality Portfolio) has agreed to pay the Adviser an annual fee of 0.50% of the Fund’s average daily net assets. S&P 500® High Quality Portfolio has agreed to pay the Adviser an annual fee of 0.29% of the Fund’s average daily net assets. As compensation for its services, the S&P 500 BuyWrite Portfolio has agreed to pay the Adviser an annual unitary management fee of 0.75% of its average daily net assets. Out of the unitary management fee, the Adviser has agreed to pay for substantially all expenses of S&P 500 BuyWrite Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit, and other services, except for advisory fees, distribution fees, if any, brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses (including acquired fund fees and expenses, if any).
The Adviser has entered into an Amended and Restated Excess Expense Agreement (the “Expense Agreement”) with the Trust on behalf of each Fund, pursuant to which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses (excluding interest expenses, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes, acquired fund fees and expenses, if any, and extraordinary expenses) of each Fund (except for S&P 500® High Quality Portfolio and S&P 500 BuyWrite Portfolio) from exceeding 0.60% of the Fund’s average daily net assets per year (the “Expense Cap”), through at least August 31, 2015. The Expense Cap (including sublicensing fees) for S&P 500® High Quality Portfolio is 0.29% of the Fund’s average daily net assets per year through at least August 31, 2015. Offering costs excluded from the Expense Cap are: (a) initial legal fees pertaining to the Funds’ Shares offered for sale; (b) initial Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange. Unless the Adviser continues the Expense Agreement, it will terminate on August 31, 2015. The Expense Agreement cannot be terminated during its term. The Adviser did not waive fees and/or pay Fund expenses during the period under this Expense Cap for DWA Momentum Portfolio, Global Listed Private Equity Portfolio and Water Resources Portfolio.
Further, through August 31, 2015, the Adviser has contractually agreed to waive a portion of the Fund’s management fee in an amount equal to 100% of the net advisory fees an affiliate of the Adviser receives that are attributable to certain of the Fund’s investments in money market funds managed by that affiliate (excluding investments of cash collateral from securities lending). The Adviser cannot discontinue this waiver prior to its expiration.
For the fiscal year ended April 30, 2014, the Adviser waived fees and/or paid Fund expenses for each Fund, in the following amounts:
Aerospace & Defense Portfolio | $ | 23,005 | ||
CleantechTM Portfolio | 34,226 | |||
DWA Momentum Portfolio | 934 | |||
Global Listed Private Equity Portfolio | 54,201 | |||
Golden Dragon China Portfolio | 1,209 | |||
S&P 500 BuyWrite Portfolio | 358 | |||
S&P 500® High Quality Portfolio | 287,217 | |||
Water Resources Portfolio | 1,032 | |||
WilderHill Clean Energy Portfolio | 271 | |||
WilderHill Progressive Energy Portfolio | 55,996 |
The Expense Agreement provides that the fees waived or expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee was waived or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above. The Expense Agreement does not apply to S&P 500 BuyWrite Portfolio.
For the following Funds, the amounts available for potential future recapture by the Adviser under the Expense Agreement and the expiration schedule at April 30, 2014 are as follows:
Total Potential Recapture Amounts | Potential Recapture Amounts Expiring | |||||||||||||||
04/30/15 | 04/30/16 | 04/30/17 | ||||||||||||||
Aerospace & Defense Portfolio | $ | 140,090 | $ | 80,440 | $ | 36,735 | $ | 22,915 | ||||||||
CleantechTM Portfolio | 171,225 | 75,189 | 61,862 | 34,174 | ||||||||||||
Global Listed Private Equity Portfolio | 32,811 | 25,652 | 7,159 | — | ||||||||||||
Golden Dragon China Portfolio | 161,702 | 70,047 | 91,655 | — | ||||||||||||
S&P 500® High Quality Portfolio | 818,113 | 259,976 | 271,138 | 286,999 | ||||||||||||
WilderHill Clean Energy Portfolio | 177,783 | 177,783 | — | — | ||||||||||||
WilderHill Progressive Energy Portfolio | 199,760 | 79,732 | 64,090 | 55,938 |
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The Trust has entered into a Distribution Agreement with Invesco Distributors, Inc. (the “Distributor”), which serves as the distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in the Shares. The Funds are not charged any fees pursuant to the Distribution Agreement. The Distributor is an affiliate of the Adviser.
The Adviser has entered into a licensing agreement for each Fund with the following entities (each, a “Licensor”):
Fund | Licensor | |
Aerospace & Defense Portfolio | International Space Business Council | |
CleantechTM Portfolio | Cleantech Indices LLC | |
DWA Momentum Portfolio | Dorsey Wright & Associates, Inc. | |
Global Listed Private Equity Portfolio | Red Rocks Capital Partners, LLC | |
Golden Dragon China Portfolio | NASDAQ OMX Group, Inc. | |
S&P 500 BuyWrite Portfolio | Standard & Poor’s, a division of The McGraw-Hill Companies, Inc. | |
S&P 500® High Quality Portfolio | Standard & Poor’s Financial Services LLC | |
Water Resources Portfolio | NASDAQ OMX Group, Inc. | |
WilderHill Clean Energy Portfolio | WilderShares, LLC | |
WilderHill Progressive Energy Portfolio | WilderShares, LLC |
Each Underlying Index name trademark is owned by its respective Licensor. These trademarks have been licensed to the Adviser for use by the Funds. Each Fund is entitled to use its Underlying Index pursuant to the Trust’s sub-licensing agreement with the Adviser. The Funds (other than the S&P 500 BuyWrite Portfolio) are required to pay the sub-licensing fees that are shown on the Statements of Operations. The Funds are not sponsored, endorsed, sold or promoted by the Licensors, and the Licensors make no representation regarding the advisability of investing in any of the Funds.
The Trust has entered into service agreements whereby The Bank of New York Mellon, a wholly owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian, fund accountant and transfer agent for each Fund.
Note 4. Investments in Affiliates
Each Fund’s Adviser is a wholly-owned subsidiary of Invesco Ltd., and therefore Invesco Ltd. is considered to be affiliated. The table below shows the Fund’s transactions in, and earnings from, its investments in Invesco Ltd. for the fiscal year ended April 30, 2014.
S&P 500 BuyWrite Portfolio
Value April 30, 2013 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain | Value April 30, 2014 | Dividend Income | ||||||||||||||||||||||
Invesco Ltd. | $ | 208,341 | $ | 86,084 | $ | (87,453 | ) | $ | 2,411 | $ | 17,651 | $ | 227,034 | $ | 5,317 |
Note 5. Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
Except for the Funds listed below, as of April 30, 2014, all of the securities in each Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The appreciation (depreciation) on options held in S&P 500 BuyWrite Portfolio was
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based on Level 1 inputs. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Investments in Securities | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Global Listed Private Equity Portfolio | ||||||||||||||||
Equity Securities | $ | 608,714,093 | $ | — | $ | — | $ | 608,714,093 | ||||||||
Swap Agreements* | — | (3,275,074 | ) | — | (3,275,074 | ) | ||||||||||
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Total Investments | $ | 608,714,093 | $ | (3,275,074 | ) | $ | — | $ | 605,439,019 | |||||||
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Golden Dragon China Portfolio | ||||||||||||||||
Equity Securities | $ | 301,709,188 | $ | 196,331 | $ | 0 | $ | 301,905,519 | ||||||||
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* | Unrealized appreciation (depreciation). |
Note 6. Derivative Investments
Global Listed Private Equity Portfolio and S&P 500 BuyWrite Portfolio have implemented required disclosures about derivative instruments and hedging activities in accordance with GAAP. This disclosure is intended to improve financial reporting about derivative instruments and hedging activities by enabling investors to better understand their effects on an entity’s financial position and financial performance. The enhanced disclosure has no impact on the results of operations reported in the financial statements.
Value of Derivative Instruments at Year-End
The table below summarizes the value of each Fund’s derivative instruments, detailed by primary risk exposure, held as of April 30, 2014:
Value | ||||||||
Risk Exposure/Derivative Type | Assets | Liabilities | ||||||
Global Listed Private Equity Portfolio | ||||||||
Equity risk: | ||||||||
Swap agreements(a) | $ | — | $ | (3,275,074 | ) | |||
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S&P 500 BuyWrite Portfolio | ||||||||
Equity risk: | ||||||||
Options written contracts(a) | $ | — | $ | (3,659,675 | ) | |||
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(a) | Values are disclosed on the Statement of Assets and Liabilities under Unrealized depreciation on swap agreements and Open options written, at value, respectively. |
Effect of Derivative Instruments for the fiscal year ended April 30, 2014
The table below summarizes each Fund’s gains (losses) on derivative instruments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statements of Operations | ||||||||
Swap Agreements* | Options* | |||||||
Global Listed Private Equity Portfolio* | ||||||||
Realized Gain | ||||||||
Equity risk | $ | 13,956,646 | $ | — | ||||
Change in Unrealized Appreciation (Depreciation) | ||||||||
Equity risk | (3,194,533 | ) | — | |||||
S&P 500 BuyWrite Portfolio* | ||||||||
Realized Gain (Loss) | ||||||||
Equity risk | — | (21,187,780 | ) | |||||
Change in Unrealized Appreciation (Depreciation) | ||||||||
Equity risk | — | 2,846,798 | ||||||
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Total | $ | 10,762,113 | $ | (18,340,982 | ) | |||
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* | The average notional value of swap agreements and options outstanding during year was $46,314,765 and $205,932,458, respectively. |
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Global Listed Private Equity Portfolio
Open Total Return Swap Agreements | ||||||||||||||
Counterparty | Swap Agreements | Termination Date | Notional Amount | Value Unrealized Appreciation (Depreciation) | ||||||||||
Citibank, N.A. | Receive a return equal to The Blackstone Group LP and pay the product of (i) 1-Month LIBOR plus 75 basis points multiplied by (ii) days in the period divided by 360 | 10/23/14 | $ | 28,278,440 | $ | (2,277,275 | ) | |||||||
Citibank, N.A. | Receive a return equal to KKR & Co. LP and pay the product of (i) 1-Month LIBOR plus 75 basis points multiplied by (ii) days in the period divided by 360 | 10/23/14 | 29,024,210 | (997,799 | ) | |||||||||
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Total | $ | (3,275,074 | ) | |||||||||||
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S&P 500 BuyWrite Portfolio
Options Written Transactions During the Year | ||||||||
Call Option Contracts | ||||||||
Number of Contracts | Premiums Received | |||||||
Beginning of year | 1,352 | $ | 2,940,359 | |||||
Written | 14,369 | 29,031,123 | ||||||
Closed | (9,517 | ) | (19,905,113 | ) | ||||
Expired | (4,861 | ) | (9,224,057 | ) | ||||
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End of year | 1,343 | $ | 2,842,312 | |||||
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Open Options Written at Year-End | ||||||||||||||||||||||||
Contract Month | Strike Price | Number of Contracts | Premiums Received | Unrealized Appreciation (Depreciation) | Value | |||||||||||||||||||
Call Option S&P 500 Index | May-14 | $ | 1,865 | 1,343 | $ | 2,842,312 | $ | (817,363 | ) | $ | 3,659,675 |
Offsetting Assets and Liabilities
Accounting Standards Update (“ASU”) No. 2011-11, Disclosures about Offsetting Assets and Liabilities, which was subsequently clarified in Financial Accounting Standards Board ASU 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” is intended to enhance disclosures about financial instruments and derivative instruments that are subject to offsetting arrangements on the Statements of Assets and Liabilities and to enable investors to better understand the effect of those arrangements on its financial position. In order for an arrangement to be eligible for netting, the Funds must have a basis to conclude that such netting arrangements are legally enforceable. The Funds enter into netting agreements and collateral agreements in an attempt to reduce the Funds’ counterparty credit risk by providing for a single net settlement with a counterparty of all financial transactions covered by the agreement in an event of default as defined under such agreement.
There were no derivative instruments subject to a netting agreement for which the Funds are not currently netting. The following tables present derivative instruments that are either subject to an enforceable netting agreement or offset by collateral arrangements as of April 30, 2014.
Global Listed Private Equity Portfolio
Liabilities: | Collateral Pledged | |||||||||||||||||||||||
Counterparty | Gross amounts presented in Statement of Assets & Liabilities | Gross amounts offset in Statement of Assets & Liabilities | Net amounts of liabilities presented in the Statement of Assets and Liabilities | Financial Instruments | Cash | Net Amount | ||||||||||||||||||
CitiBank, N.A. | $ | 3,275,074 | $ | — | $ | 3,275,074 | $ | (2,230,000 | ) | $ | — | $ | 1,045,074 |
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Note 7. Distributions to Shareholders and Tax Components of Net Assets
Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended April 30, 2014 and 2013:
2014 | 2013 | |||||||||||||||
Ordinary Income | Long-term Capital Gains | Ordinary Income | Long-term Capital Gains | |||||||||||||
Aerospace & Defense Portfolio | $ | 993,578 | $ | — | $ | 1,029,052 | $ | — | ||||||||
CleantechTM Portfolio | 713,573 | — | 712,757 | — | ||||||||||||
DWA Momentum Portfolio | 3,053,165 | — | 5,799,247 | — | ||||||||||||
Global Listed Private Equity Portfolio | 65,805,444 | — | 12,397,099 | — | ||||||||||||
Golden Dragon China Portfolio | 2,898,245 | — | 4,722,570 | — | ||||||||||||
S&P 500 BuyWrite Portfolio | 12,553,393 | 66,033 | 8,424,421 | 2,056,844 | ||||||||||||
S&P 500® High Quality Portfolio | 5,320,142 | — | 3,292,190 | — | ||||||||||||
Water Resources Portfolio | 5,035,124 | — | 6,646,911 | — | ||||||||||||
WilderHill Clean Energy Portfolio | 5,058,769 | — | 4,631,864 | — | ||||||||||||
WilderHill Progressive Energy Portfolio | 473,310 | — | 318,497 | — |
Tax Components of Net Assets at Fiscal Year-End:
Undistributed Ordinary Income | Temporary Book/Tax Differences | Net Unrealized Appreciation (Depreciation)— Investment Securities | Net Unrealized Appreciation — Other Investments | Capital Loss Carryforward | Post-October Capital Losses Deferrals* | Shares of Beneficial Interest | Total Net Assets | |||||||||||||||||||||||||
Aerospace & Defense Portfolio | $ | — | $ | (15,632 | ) | $ | 16,416,637 | $ | — | $ | (29,310,273 | ) | $ | (68,362 | ) | $ | 111,063,857 | $ | 98,086,227 | |||||||||||||
CleantechTM Portfolio | 170,728 | (14,516 | ) | 23,403,287 | 3,138 | (83,585,557 | ) | (1,055,045 | ) | 145,613,383 | 84,535,418 | |||||||||||||||||||||
DWA Momentum Portfolio | — | (31,513 | ) | 222,443,350 | — | (189,798,325 | ) | (16,990,109 | ) | 1,244,820,140 | 1,260,443,543 | |||||||||||||||||||||
Global Listed Private Equity Portfolio | 902,923 | (21,035 | ) | 34,131,226 | 26,112 | (79,008,198 | ) | — | 627,570,238 | 583,601,266 | ||||||||||||||||||||||
Golden Dragon China Portfolio | 400,840 | (27,095 | ) | 15,362,939 | — | (283,317,660 | ) | (2,408,700 | ) | 528,558,250 | 258,568,574 | |||||||||||||||||||||
S&P 500 BuyWrite Portfolio | 13,539,183 | — | — | — | — | (774,931 | ) | 236,694,173 | 249,458,425 | |||||||||||||||||||||||
S&P 500® High Quality Portfolio | 676,785 | (16,582 | ) | 69,891,708 | — | (139,678,368 | ) | — | 434,812,660 | 365,686,203 | ||||||||||||||||||||||
Water Resources Portfolio | 2,268,045 | (74,492 | ) | 194,799,159 | — | (530,877,706 | ) | — | 1,324,132,081 | 990,247,087 | ||||||||||||||||||||||
WilderHill Clean Energy Portfolio | 767,869 | (39,998 | ) | (1,166,286 | ) | — | (1,438,177,924 | ) | (8,481,299 | ) | 1,665,198,862 | 218,101,224 | ||||||||||||||||||||
WilderHill Progressive Energy Portfolio | 82,210 | (11,483 | ) | 8,037,046 | — | (32,321,080 | ) | — | 70,032,413 | 45,819,106 |
* | The Funds will elect to defer net capital losses incurred after October 31 (“Post-October Capital Losses”) within the taxable year that are deemed to arise on the first business day of each Fund’s next taxable year. |
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Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Funds to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in 8 tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The following Funds have capital loss carryforwards as of April 30, 2014, which expire as follows:
Post-effective no expiration | ||||||||||||||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Short-term | Long-term | Total* | Utilized | Expired | |||||||||||||||||||||||||||||||
Aerospace & Defense Portfolio | $ | 104,662 | $ | 2,374,303 | $ | 7,470,897 | $ | 6,428,813 | $ | 9,464,875 | $ | — | $ | 3,466,723 | $ | 29,310,273 | $ | — | $ | — | ||||||||||||||||||||
CleantechTM Portfolio | — | 1,171,839 | 14,341,075 | 25,186,026 | 12,098,616 | 1,476,508 | 29,311,493 | 83,585,557 | — | — | ||||||||||||||||||||||||||||||
DWA Momentum Portfolio | — | 5,046,566 | 92,771,702 | 60,219,842 | 10,496,532 | 21,263,683 | — | 189,798,325 | 30,262,612 | — | ||||||||||||||||||||||||||||||
Global Listed Private Equity Portfolio | — | 796,018 | 7,687,052 | 47,149,399 | — | 13,517,688 | 9,858,041 | 79,008,198 | 6,727,087 | — | ||||||||||||||||||||||||||||||
Golden Dragon China Portfolio | 3,128,677 | 1,235,904 | 22,836,421 | 74,072,167 | 35,483,714 | 13,898,904 | 132,661,873 | 283,317,660 | — | 1,018,146 | ||||||||||||||||||||||||||||||
S&P 500 BuyWrite Portfolio | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||
S&P 500® High Quality Portfolio | 28,563,259 | 21,013,690 | 37,241,965 | 42,466,537 | 9,869,908 | — | 523,009 | 139,678,368 | — | — | ||||||||||||||||||||||||||||||
Water Resources Portfolio | 11,876,489 | 3,553,481 | 93,208,162 | 265,948,030 | 33,978,301 | 18,359,580 | 103,953,663 | 530,877,706 | — | — | ||||||||||||||||||||||||||||||
WilderHill Clean Energy Portfolio | 89,533,576 | 44,707,703 | 261,712,498 | 460,657,845 | 241,008,862 | 57,314,443 | 283,242,997 | 1,438,177,924 | — | 2,098,368 | ||||||||||||||||||||||||||||||
WilderHill Progressive Energy Portfolio | — | 179,432 | 8,319,827 | 12,433,887 | 2,282,887 | 3,244,080 | 5,860,967 | 32,321,080 | — | — |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
Note 8. Investment Transactions
For the fiscal year ended April 30, 2014, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, U.S. Treasury obligations, money market funds and in-kind transactions, were as follows:
Purchases | Sales | |||||||
Aerospace & Defense Portfolio | $ | 6,398,199 | $ | 6,130,973 | ||||
CleantechTM Portfolio | 18,305,132 | 18,438,027 | ||||||
DWA Momentum Portfolio | 800,250,298 | 799,676,902 | ||||||
Global Listed Private Equity Portfolio | 224,753,667 | 253,862,868 | ||||||
Golden Dragon China Portfolio | 96,065,019 | 97,692,079 | ||||||
S&P 500 BuyWrite Portfolio | 65,999,947 | 97,617,017 |
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Purchases | Sales | |||||||
S&P 500® High Quality Portfolio | $ | 40,327,139 | $ | 39,404,173 | ||||
Water Resources Portfolio | 324,566,399 | 322,029,259 | ||||||
WilderHill Clean Energy Portfolio | 115,555,049 | 116,386,065 | ||||||
WilderHill Progressive Energy Portfolio | 14,978,428 | 15,036,071 |
For the fiscal year ended April 30, 2014, in-kind transactions associated with creations and redemptions were as follows:
Cost of Securities Received | Value of Securities Delivered | |||||||
Aerospace & Defense Portfolio | $ | 48,245,001 | $ | 20,645,916 | ||||
CleantechTM Portfolio | 1,498,147 | 5,244,224 | ||||||
DWA Momentum Portfolio | 390,922,999 | 158,320,699 | ||||||
Global Listed Private Equity Portfolio | 207,819,837 | 55,580,637 | ||||||
Golden Dragon China Portfolio | 123,570,359 | 113,437,600 | ||||||
S&P 500 BuyWrite Portfolio | 73,632,106 | 34,299,257 | ||||||
S&P 500® High Quality Portfolio | 137,248,937 | 45,911,695 | ||||||
Water Resources Portfolio | 157,543,415 | 193,172,005 | ||||||
WilderHill Clean Energy Portfolio | 124,519,965 | 104,394,954 | ||||||
WilderHill Progressive Energy Portfolio | 5,980,135 | 5,644,177 |
Gains (losses) on in-kind transactions are generally not considered taxable gains (losses) for federal income tax purposes.
At April 30, 2014, the aggregate cost and the net unrealized appreciation (depreciation) of investments for tax purposes were as follows:
Cost | Net Unrealized Appreciation (Depreciation) | Gross Unrealized Appreciation | Gross Unrealized (Depreciation) | |||||||||||||
Aerospace & Defense Portfolio | $ | 81,733,041 | $ | 16,416,637 | $ | 18,007,434 | $ | (1,590,797 | ) | |||||||
CleantechTM Portfolio | 67,188,475 | 23,403,287 | 26,118,488 | (2,715,201 | ) | |||||||||||
DWA Momentum Portfolio | 1,038,892,994 | 222,443,350 | 231,021,271 | (8,577,921 | ) | |||||||||||
Global Listed Private Equity Portfolio | 574,582,867 | 34,131,226 | 55,633,132 | (21,501,906 | ) | |||||||||||
Golden Dragon China Portfolio | 286,542,580 | 15,362,939 | 36,281,979 | (20,919,040 | ) | |||||||||||
S&P 500 BuyWrite Portfolio | 252,903,496 | — | — | — | ||||||||||||
S&P 500® High Quality Portfolio | 295,849,073 | 69,891,708 | 70,228,898 | (337,190 | ) | |||||||||||
Water Resources Portfolio | 794,945,713 | 194,799,159 | 226,967,417 | (32,168,258 | ) | |||||||||||
WilderHill Clean Energy Portfolio | 280,876,171 | (1,166,286 | ) | 37,226,463 | (38,392,749 | ) | ||||||||||
WilderHill Progressive Energy Portfolio | 45,929,027 | 8,037,046 | 10,606,646 | (2,569,600 | ) |
Note 9. Reclassification of Permanent Differences
Primarily as a result of differing book/tax treatment of in-kind transactions on April 30, 2014, amounts were reclassified between undistributed net investment income (loss), undistributed net realized gain (loss) and shares of beneficial interest. These reclassifications had no effect on the net assets of each Fund. For the fiscal year ended April 30, 2014, the reclassifications were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Net Realized Gain (Loss) | Shares of Beneficial Interest | ||||||||||
Aerospace & Defense Portfolio | $ | 13,380 | $ | (5,141,731 | ) | $ | 5,128,351 | |||||
CleantechTM Portfolio | 119,741 | (1,475,739 | ) | 1,355,998 | ||||||||
DWA Momentum Portfolio | 834,404 | (38,460,923 | ) | 37,626,519 | ||||||||
Global Listed Private Equity Portfolio | 21,833,563 | (32,099,771 | ) | 10,266,208 | ||||||||
Golden Dragon China Portfolio | 331,307 | (44,584,664 | ) | 44,253,357 | ||||||||
S&P 500 BuyWrite Portfolio | 9,755,836 | (9,755,836 | ) | — | ||||||||
S&P 500® High Quality Portfolio | — | (15,465,270 | ) | 15,465,270 | ||||||||
Water Resources Portfolio | — | (65,597,513 | ) | 65,597,513 | ||||||||
WilderHill Clean Energy Portfolio | 183,889 | (37,512,574 | ) | 37,328,685 | ||||||||
WilderHill Progressive Energy Portfolio | — | (2,084,468 | ) | 2,084,468 |
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Note 10. Trustees’ and Officer’s Fees
Trustees’ and Officer’s Fees include amounts accrued by the Funds to pay remuneration to the Independent Trustees and Officer of the Funds. The Adviser, as a result of the unitary management fee, pays for such compensation for S&P 500 BuyWrite Portfolio. The Trustee who is an “interested person” (the “Non-Independent Trustee”) of the Trust does not receive any Trustees’ fees.
The Trust has adopted a deferred compensation plan (the “Plan”). Under the Plan, an Independent Trustee who has executed a Deferred Fee Agreement (a “Participating Trustee”) may defer receipt of all or a portion of his compensation (“Deferral Fees”). Such Deferral Fees are deemed to be invested in select PowerShares Funds. The Deferral Fees payable to the Participating Trustee are valued as of the date such Deferral Fees would have been paid to the Participating Trustee. The value increases with contributions or with increases in the value of the Shares selected, and the value decreases with distributions or with declines in the value of the Shares selected. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Funds.
Note 11. Capital
Shares are created and redeemed by each Fund only in Creation Units of 50,000 Shares. Only Authorized Participants are permitted to purchase or redeem Creation Units from the Funds. Such transactions are generally permitted in exchange for Deposit Securities, with a balancing cash component to equate the transaction to the NAV per Share of a Fund of the Trust on the transaction date. However, for all Funds, cash in an amount equivalent to the value of certain securities may be substitutded, generally when the securities are not available in sufficient quantity for delivery, not eligible for trading by the Authorized Participant or as a result of other market circumstances.
To the extent that the Funds permit transactions in exchange for Deposit Securities, each Fund may issue Shares in advance of receipt Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to 105% of the market value of the missing Deposit Securities. In accordance with each Fund’s Participant Agreement, Creation Units will be issued to an Authorized Participant, notwithstanding the fact that the corresponding Deposit Securities have not been received in part or in whole, in reliance on the undertaking of the Authorized Participant to deliver the missing Deposit Securities as soon as possible, which undertaking shall be secured by the Authorized Participant’s delivery and maintenance of collateral consisting of cash in the form of U.S. dollars in immediately available funds having a value (marked-to-market daily) at least equal to 105%, which the Adviser may change from time to time, of the value of the missing Deposit Securities.
Transactions in each Fund’s Shares are disclosed in detail on the Statements of Changes in Net Assets.
Note 12. Indemnifications
Under the Trust’s organizational documents, its officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Each Independent Trustee is also indemnified against certain liabilities arising out of the performance of his duties to the Trust pursuant to an Indemnification Agreement between the Independent Trustee and the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
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Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of PowerShares Aerospace & Defense Portfolio, PowerShares CleantechTM Portfolio, PowerShares DWA Momentum Portfolio (formerly PowerShares DWA Technical LeadersTM Portfolio) , PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares S&P 500 BuyWrite Portfolio, PowerShares S&P 500® High Quality Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio and PowerShares WilderHill Progressive Energy Portfolio (each an individual portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the “Funds”) at April 30, 2014, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2014 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Chicago, IL
June 24, 2014
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As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, (excluding PowerShares S&P 500 BuyWrite Portfolio), you incur advisory fees and other Fund expenses. As a shareholder of a Fund of the PowerShares S&P 500 BuyWrite Portfolio, you incur a unitary management fee. In addition to the unitary management fee, a shareholder may pay distribution fees, if any, brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses (including acquired fund fees and expenses, if any). The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2014.
In addition to the fees and expenses which the PowerShares DWA Momentum Portfolio and PowerShares Global Listed Private Equity Portfolio (collectively, the “Portfolios”) bear directly, the Portfolios indirectly bear a pro rata share of the fees and expenses of the investment companies in which the Portfolios invest. The amount of fees and expenses incurred indirectly by the Portfolios will vary because the investment companies have varied expenses and fee levels and the Portfolios may own different proportions of the investment companies at different times. Estimated investment companies’ expenses are not expenses that are incurred directly by the Portfolios. They are expenses that are incurred directly by the investment companies and are deducted from the value of the investment companies the Portfolios invests in. The effect of the estimated investment companies’ expenses that you bear indirectly are included in each Portfolio’s total return.
Actual Expenses
The first line in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following table provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as sales charges and brokerage commissions. Therefore, the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by a Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares Aerospace & Defense Portfolio (PPA) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,125.83 | 0.66 | % | $ | 3.48 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.52 | 0.66 | 3.31 | ||||||||||||
PowerShares CleantechTM Portfolio (PZD) | ||||||||||||||||
Actual | 1,000.00 | 1,063.80 | 0.68 | 3.48 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.42 | 0.68 | 3.41 | ||||||||||||
PowerShares DWA Momentum Portfolio (PDP) | ||||||||||||||||
Actual | 1,000.00 | 1,067.11 | 0.63 | 3.23 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares Global Listed Private Equity Portfolio (PSP) | ||||||||||||||||
Actual | 1,000.00 | 1,042.88 | 0.68 | 3.44 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.42 | 0.68 | 3.41 |
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Fees and Expenses (continued)
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares Golden Dragon China Portfolio (PGJ) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 978.01 | 0.70 | % | $ | 3.43 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.32 | 0.70 | 3.51 | ||||||||||||
PowerShares S&P 500 BuyWrite Portfolio (PBP) | ||||||||||||||||
Actual | 1,000.00 | 1,065.77 | 0.75 | 3.84 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.08 | 0.75 | 3.76 | ||||||||||||
PowerShares S&P 500® High Quality Portfolio (SPHQ) | ||||||||||||||||
Actual | 1,000.00 | 1,076.68 | 0.29 | 1.49 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,023.36 | 0.29 | 1.45 | ||||||||||||
PowerShares Water Resources Portfolio (PHO) | ||||||||||||||||
Actual | 1,000.00 | 1,045.64 | 0.60 | 3.04 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.82 | 0.60 | 3.01 | ||||||||||||
PowerShares WilderHill Clean Energy Portfolio (PBW) | ||||||||||||||||
Actual | 1,000.00 | 1,037.89 | 0.70 | 3.54 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.32 | 0.70 | 3.51 | ||||||||||||
PowerShares WilderHill Progressive Energy Portfolio (PUW) | ||||||||||||||||
Actual | 1,000.00 | 1,088.70 | 0.70 | 3.63 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.32 | 0.70 | 3.51 |
(1) | Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six-month period ended April 30, 2014. Expenses are calculated by multiplying the Fund’s annualized expense ratio by the average account value for the period, then multiplying the result by 181/365. Expense ratios for the most recent six-month period may differ from expense ratios based on the annualized data in the Financial Highlights. |
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Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.
The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state’s requirement.
Each Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended April 30, 2014:
Federal Income Tax Information
Qualified Dividend Income* | Corporate Dividends Received Deduction* | Long Term Capital Gains | |||||||||||||
Aerospace & Defense Portfolio | 100 | % | 100 | % | $ | — | |||||||||
CleantechTM Portfolio | 100 | % | 16 | % | — | ||||||||||
DWA Technical LeadersTM Portfolio | 100 | % | 100 | % | — | ||||||||||
Global Listed Private Equity Portfolio | 26 | % | 4 | % | — | ||||||||||
Golden Dragon China Portfolio | 82 | % | 0 | % | — | ||||||||||
S&P 500 BuyWrite Portfolio | 0 | % | 0 | % | 66,033 | ||||||||||
S&P 500® High Quality Portfolio | 100 | % | 100 | % | — | ||||||||||
Water Resources Portfolio | 100 | % | 98 | % | — | ||||||||||
WilderHill Clean Energy Portfolio | 16 | % | 8 | % | — | ||||||||||
WilderHill Progressive Energy Portfolio | 100 | % | 49 | % | — |
* | The above percentages are based on ordinary income dividends paid to shareholders during the Fund’s fiscal year. |
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The Independent Trustees, the Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by each Trustee are shown below.
The Trustees and officers information is current as of April 30, 2014.
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Ronn R. Bagge (1958) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Founder and Principal, YQA Capital Management LLC (1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider). | 114 | None | |||||
Todd J. Barre (1957) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2010 | Assistant Professor of Business, Trinity Christian College (2010-Present); formerly Vice President and Senior Investment Strategist (2001-2008), Director of Open Architecture and Trading (2007-2008), Head of Fundamental Research (2004-2007) and Vice President and Senior Fixed Income Strategist (1994-2001), BMO Financial Group/Harris Private Bank. | 114 | None | |||||
Marc M. Kole (1960) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2006 | Chief Financial Officer, Hope Network (social services) (2008-2012); formerly, Assistant Vice President and Controller, Priority Health (health insurance) (2005-2008); Senior Vice President of Finance, United Healthcare (2004-2005); Senior Vice President of Finance, Oxford Health Plans (2000-2004). | 114 | None | |||||
Yung Bong Lim (1964) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Managing Partner, Residential Dynamics Group LLC (2008-Present); formerly, Managing Director, Citadel Investment Group, L.L.C. (1999-2007). | 114 | None | |||||
Philip M. Nussbaum (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (2004-Present). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Gary R. Wicker (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Senior Vice President of Global Finance and Chief Financial Officer at RBC Ministries (publishing company) (2013-Present); formerly, Executive Vice President and Chief Financial Officer, Zondervan Publishing (a division of Harper Collins/NewsCorp) (2007-2012); Senior Vice President and Group Controller (2005-2006), Senior Vice President and Chief Financial Officer (2003-2004), Chief Financial Officer (2001-2003), Vice President, Finance and Controller (1999-2001) and Assistant Controller (1997-1999), divisions of The Thomson Corporation (information services provider). | 114 | None | |||||
Donald H. Wilson (1959) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Chairman of the Board and Trustee | Chairman since 2012; Trustee since 2006 | Chairman, President and Chief Executive Officer, Community Financial Shares, Inc. and Community Bank—Wheaton/Glen Ellyn (subsidiary) (2013–Present); Chairman and Chief Executive Officer, Stone Pillar Advisers, Ltd. (2010-Present); formerly, Chief Operating Officer, AMCORE Financial, Inc. (bank holding company) (2007-2009); Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (2006-2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (1995-2006). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
The Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by the Non-Independent Trustee and the other directorships, if any, held by the Non-Independent Trustee are shown below.
Name, Address and Age of Non-Independent Trustee | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Non-Independent Trustee | Other Directorships Held by Non-Independent Trustee During the Past 5 Years | |||||
Kevin M. Carome (1956) Invesco Ltd. Two Peachtree Pointe 1555 Peachtree St., N.E., Suite 1800 Atlanta, GA 30309 | Trustee | Since 2010 | Senior Managing Director, Secretary and General Counsel, Invesco Ltd. (2006-Present); Director, Invesco Advisers, Inc. (2009-Present); Director, Invesco Advisers, Inc., Invesco Finance PLC, INVESCO Funds Group, Inc., and Invesco Holding Company Limited; Director and Executive Vice President, Invesco Finance, Inc., Invesco Group Services, Inc., Invesco Investments (Bermuda) Ltd., Invesco North American Holdings, Inc., and IVZ, Inc.; Director and Secretary, IVZ Bahamas Private Limited; formerly, Senior Vice President, Secretary and General Counsel, Invesco Advisers, Inc. (2003-2005); Senior Vice President and General Counsel, Liberty Financial Companies, Inc. (2000-2001); General Counsel of certain investment management subsidiaries of Liberty Financial Companies, Inc. (1998-2000); Associate General Counsel, Liberty Financial Companies, Inc. (1993-1998); Associate, Ropes & Gray LLP. | 114 | None |
* | This is the date the Non-Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Andrew Schlossberg (1974) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046 | President | Since 2009 | Director, Invesco Distributors, Inc. (2012—Present); Managing Director – U.S. Strategy and Marketing, Invesco PowerShares Capital Management LLC (2010–Present); Managing Director, U.S. head of business strategy and chief marketing officer for Invesco Ltd. in the United States (2008-Present); Director, Invesco Distributors, Inc. (2012-Present); and Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present); formerly, Mr. Schlossberg served in multiple roles within Invesco, including head of corporate development, as well as global leadership roles in strategy and product development in the company’s North American Institutional and Retirement divisions (2002-2007). | |||
Peter Hubbard (1981) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2009 | Vice President and Director of Portfolio Management—Invesco PowerShares Capital Management LLC (2008-Present); formerly, Portfolio Manager, Invesco PowerShares Capital Management LLC (2007-2008); Research Analyst, Invesco PowerShares Capital Management LLC (2005-2007); Research Analyst and Trader, Ritchie Capital, a hedge fund operator (2003-2005). | |||
David Warren (1957) Invesco Canada Ltd. 5140 Yonge Street Suite 900, Toronto, Ontario M2N 6X7 | Vice President | Since 2009 | Managing Director—Chief Administrative Officer, Americas, Invesco PowerShares Capital Management LLC; Senior Vice President, Invesco Advisers, Inc. (2009–Present); Director, Executive Vice President and Chief Financial Officer, Invesco Inc. (2009–Present); Senior Vice President, Invesco Management Group, Inc. (2007–Present); Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) and Chief Administrative Officer, North American Retail, Invesco Ltd. (2007-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Invesco Canada Holdings Inc. (2002–Present), Invesco Corporate Class Inc., and Invesco Canada Fund Inc.; Director, Executive Vice President and Chief Financial Officer, Invesco, Inc.; formerly, Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) (2000-2006). | |||
Sheri Morris (1964) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Vice President | Since 2012 | Vice President, Treasurer and Principal Financial Officer, The Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present) and Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; formerly, Treasurer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc. | |||
Rudolf E. Reitmann (1971) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global Exchange Traded Funds Operations, Invesco PowerShares Capital Management LLC (since 2013). |
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Daniel E. Draper (1968) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Senior Vice President, Invesco Distributors, Inc. (since 2014); Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Managing Director, Invesco PowerShares Global ETFs (since 2013); formerly, Managing Director, Credit Suisse Asset Management (2010–2013) and Lyxor Asset Management/Societe Generale (2007–2010). | |||
Steven M. Hill (1964) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President and Treasurer | Since 2013 | Vice President and Treasurer of PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global ETF Administration, Invesco PowerShares Capital Management LLC (since 2011); formerly, Senior Managing Director and Chief Financial Officer, Destra Capital Management LLC and its subsidiaries (2010-2011); Chief Financial Officer, Destra Investment Trust and Destra Investment Trust II (2010-2011); Senior Managing Director, Claymore Securities, Inc. (2003-2010); and Chief Financial Officer, Claymore sponsored mutual funds (2003-2010). | |||
Christopher Joe (1969) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Chief Compliance Officer | Since 2012 | U.S. Compliance Director, Invesco, Ltd. (since 2006); formerly, Chief Compliance Officer, Invesco Investment Advisers, LLC (registered investment adviser) (2010–2013); formerly, Assistant Fund Accounting Manager, Invesco, Ltd. (1998-1999). | |||
Anna Paglia (1974) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Secretary | Since 2011 | Secretary, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (2011-Present); Head of Legal, Invesco PowerShares Capital Management LLC (2010-Present); formerly, Partner, K&L Gates LLP (formerly, Bell Boyd & Lloyd LLP) (2007-2010); Associate Counsel at Barclays Global Investors Ltd. (2004-2006). |
Availability of Additional Information About the Trustees
The Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request at (800) 983-0903.
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for the following 51 series (each, a “Fund” and collectively, the “Funds”):
PowerShares Aerospace & Defense Portfolio
PowerShares BuyBack Achievers™ Portfolio
PowerShares Cleantech™ Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares DWA Momentum Portfolio
PowerShares DWA Basic Materials Momentum Portfolio
PowerShares DWA Consumer Cyclicals Momentum Portfolio
PowerShares DWA Consumer Staples Momentum Portfolio
PowerShares DWA Energy Momentum Portfolio
PowerShares DWA Financial Momentum Portfolio
PowerShares DWA Healthcare Momentum Portfolio
PowerShares DWA Industrials Momentum Portfolio
PowerShares DWA NASDAQ Momentum Portfolio
PowerShares DWA Technology Momentum Portfolio
PowerShares DWA Utilities Momentum Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Building & Construction Portfolio
PowerShares Dynamic Energy Exploration & Production Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Market Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Oil & Gas Services Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Financial Preferred Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares Fundamental Pure Large Core Portfolio
PowerShares Fundamental Pure Large Growth Portfolio
PowerShares Fundamental Pure Large Value Portfolio
PowerShares Fundamental Pure Mid Core Portfolio
PowerShares Fundamental Pure Mid Growth Portfolio
PowerShares Fundamental Pure Mid Value Portfolio
PowerShares Fundamental Pure Small Core Portfolio
PowerShares Fundamental Pure Small Growth Portfolio
PowerShares Fundamental Pure Small Value Portfolio
PowerShares Global Listed Private Equity Portfolio
PowerShares Golden Dragon China Portfolio
PowerShares High Yield Equity Dividend Achievers TM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares S&P 500® High Quality Portfolio
PowerShares Water Resources Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares WilderHill Progressive Energy Portfolio
PowerShares Zacks Micro Cap Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year, ten-year and since-inception periods ended December 31, 2013, as applicable, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
explanations for any tracking error. The Trustees noted that for each applicable period the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s advisory fee and net expense ratio, as compared to information compiled by the Adviser from Lipper Inc. databases on the advisory fees and net expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual advisory fee charged to each Fund is:
— | 0.50% of the Fund’s average daily net assets for each Fund other than PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend AchieversTM Portfolio, PowerShares International Dividend AchieversTM Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio; |
— | 0.40% of the Fund’s average daily net assets for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; and |
— | 0.29% of the Fund’s average daily net assets for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio. |
The Trustees also noted that the Adviser has agreed to waive a portion of its advisory fee and/or pay expenses (an “Expense Cap”) to the extent necessary to prevent the annual operating expenses of each Fund from exceeding the percentage of that Fund’s average daily net assets, at least until August 31, 2015, as set forth below:
— | 0.60%, excluding interest expenses, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares DWA NASDAQ Momentum Portfolio and PowerShares Dynamic Market Portfolio; |
— | 0.50%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; |
— | 0.39%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio and PowerShares Fundamental Pure Small Value Portfolio; |
— | 0.29%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares S&P 500® High Quality Portfolio; |
— | 0.60%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio and PowerShares DWA Utilities Momentum Portfolio (the Trustees noted that prior to December 17, 2013, licensing fees were excluded from the Expense Cap); and |
— | 0.60%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each other Fund. |
The Trustees noted that the Adviser represented that it does not serve as the investment adviser to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds, but that the Adviser provides sub-advisory services to clients with comparable investment strategies as certain of the Funds. The Trustees further noted the Adviser’s explanation with respect to the sub-advisory fees it receives for such services in comparison to the advisory fees charged to the Funds. The Trustees noted that each Fund’s advisory fee was:
— | higher than the median advisory fee of its ETF peer funds (except for the advisory fee of each of PowerShares Financial Preferred Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio and PowerShares International Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its ETF peer funds); and |
— | higher than the median advisory fee of its open-end index peer funds (except for the advisory fee of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares High Yield Equity Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median advisory fee of its open-end actively-managed peer funds. |
The Trustees determined that the advisory fees were reasonable, noting the complexity of the indexes, the distinguishing factors of the Funds, and the administrative, operational and management oversight costs for the Adviser. With respect to the Funds’ net expense ratios, the Trustees noted that the net expense ratio for each Fund was:
— | higher than the median net expense ratio of its ETF peer funds (except for the net expense ratio of each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers Portfolio and PowerShares S&P 500® High Quality Portfolio, which was equal to or less than the median net expense ratio of its ETF peer funds); and |
— | higher than the median net expense ratio of its open-end index peer funds (except for the net expense ratio of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio, PowerShares DWA Utilities Momentum Portfolio, PowerShares Dynamic Large Cap Growth Portfolio, PowerShares Dynamic Networking Portfolio, PowerShares Dynamic Semiconductors Portfolio, PowerShares Dynamic Software Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares High Yield Equity |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Dividend Achievers™ Portfolio and PowerShares S&P 500® High Quality Portfolio, which was lower than the median net expense ratio of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median net expense ratio of its open-end actively-managed peer funds. |
The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds, and noted those Funds for which license fees are included in the Funds’ Expense Caps.
The Board concluded that the advisory fee and expense ratio of each Fund (giving effect to the Fund’s Expense Cap) were reasonable and appropriate in light of the services provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to any of the Funds was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size, expense ratio and expense limitation agreed to by the Adviser. The Trustees noted that, for Funds whose expenses are higher than their respective Expense Caps, any reduction in that Fund’s expenses would be enjoyed by the Adviser, but that Fund shareholders benefit from the lower expense ratio as a result of the Fund’s Expense Cap. The Trustees also noted that the Excess Expense Agreement with the Trust provides that the Adviser is entitled to be reimbursed by each Fund, other than PowerShares Dynamic Market Portfolio and PowerShares DWA NASDAQ Momentum Portfolio, for fees waived or expenses absorbed pursuant to the Expense Cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its Expense Cap. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate, noting the Fund expenses the Adviser has borne as a result of the Expense Cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for PowerShares NASDAQ Internet Portfolio and PowerShares S&P 500 BuyWrite Portfolio (each, a “Fund” and together, the “Funds”).
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s oversight of the execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year and since-inception (June 12, 2008 for PowerShares NASDAQ Internet Portfolio and December 20, 2007 for PowerShares S&P 500 BuyWrite Portfolio) periods ended December 31, 2013, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various explanations for any tracking error. The Trustees noted that for each period, the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s net expense ratio and unitary advisory fee, as compared to information compiled by the Adviser from Lipper Inc. databases on the expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual unitary advisory fee is 0.60% for PowerShares NASDAQ Internet Portfolio and 0.75% for PowerShares S&P 500 BuyWrite Portfolio, and that the Adviser pays all other operating expenses of each Fund, except that each Fund pays its brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses.
The Trustees noted that the Adviser represented that it does not provide investment advisory services to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds. The Trustees noted that PowerShares NASDAQ Internet Portfolio’s advisory fee was higher than the median net expense ratio of its ETF peer funds, but was lower than the median net expense ratios of its open-end index peer funds and open-end actively-managed peer funds. The Trustees noted that PowerShares S&P 500 BuyWrite Portfolio’s advisory fee was lower than the median net expense ratios of its ETF peer funds, open-end index peer funds and open-end actively-managed peer funds. The Trustees noted that each Fund’s advisory fee was reasonable because of the complexity of the indexes, the distinguishing factors of the Funds and the administrative, operational and management oversight costs for the Adviser. The Trustees also noted that a portion of each Fund’s advisory fee was attributable to a license fee payable out of the unitary fee charged to that Fund. The Board concluded that the unitary advisory fee charged to each Fund was reasonable and appropriate in light of the services provided.
In conjunction with their review of the unitary advisory fee, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement. The Trustees reviewed information provided by the
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to each Fund was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size and expense ratio. The Trustees noted that any reduction in fixed costs associated with the management of the Funds would be enjoyed by the Adviser, but a unitary fee provides a level of certainty in expenses for the Funds. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationships with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
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Proxy Voting Policies and Procedures
A description of the Trust’s proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 983-0903. This information is also available on the Securities and Exchange Commission’s (“Commission”) website at www.sec.gov.
Information regarding how each Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 983-0903; or (ii) accessing the Trust’s Form N-PX on the Commission’s website at www.sec.gov.
Quarterly Portfolios
The Trust files its complete schedule of portfolio holdings for the Funds with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Trust’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Trust’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
Frequency Distribution of Discounts and Premiums
A table showing the number of days the market price of each Fund’s shares was greater than the Fund’s net asset value, and the number of days it was less than the Fund’s net asset value (i.e., premium or discount) for the most recently completed calendar year, and the calendar quarters since that year end (or the life of the Fund, if shorter) may be found at the Fund’s website at www.invescopowershares.com.
©2014 Invesco PowerShares Capital Management LLC | P-PS-AR-4 | |||||
3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | ||||||
invescopowershares.com 800.983.0903 | @PowerShares |
April 30, 2014 |
2014 Annual Report to Shareholders
PKW | PowerShares BuyBack AchieversTM Portfolio | |
PFM | PowerShares Dividend AchieversTM Portfolio | |
PGF | PowerShares Financial Preferred Portfolio | |
PEY | PowerShares High Yield Equity Dividend AchieversTM Portfolio | |
PID | PowerShares International Dividend AchieversTM Portfolio |
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Domestic Equity
The U.S. equity market rose to multiyear or all-time highs during the fiscal year ended April 30, 2014.1 Corporate earnings were resilient in the face of modest economic growth, driven by strong profitability across many sectors, and fundamentals for corporations and consumers remained relatively stable following significant recovery in prior years.
However, the fiscal year began with capital markets in the U.S. declining. In May and June 2013, equity and fixed income markets fell following then-U.S. Federal Reserve (the “Fed”) Chairman Ben Bernanke’s comments suggesting that the time was approaching to reduce, or “taper,” the size of its bond buying economic stimulus program. This sell-off was brief but broad, and few asset classes were immune. Markets stabilized in mid-summer and generally rose, with some brief interruptions, through the end of 2013. The Fed’s announcement in December that tapering of its bond purchases would begin in early 2014 had little effect on equities as the announcement was widely anticipated. After strong performance in the second half of 2013, the U.S. equity market turned volatile in the first four months of 2014 as investors worried that stocks may have risen too high, too fast in 2013. Adding to this investor uncertainty during 2014 was political upheaval in Ukraine and signs of economic sluggishness in the U.S. and China.
1 | Source: Reuters |
International Market Environment
The fiscal year ended April 30, 2014 saw strong US and European equity market returns, while emerging markets experienced volatility during the period. The period began with U.S. interest rates on 10-year treasuries rising 140 basis points over the summer of 2013.1 This spike in rates caused the U.S. Dollar to rise in value and pressure commodity sensitive emerging market economies. Despite this rise in rates European and U.S. economic fundamentals continued to improve. The U.S. Federal Reserve (the “Fed”) reassured investors that asset purchases and low Fed Funds rates would remain in place as long as needed.
During the 3rd and 4th calendar quarters of 2013, emerging market fundamentals improved and China’s government planned sweeping reforms. Spanish and Italian bond yields-which had been as high as 7% in mid-2012-continued their decline in the second half of 2013 to finish the calendar year at their lowest level since the onset of the Greek financial crisis in 2010.1 These factors caused global equity markets to finish 2013 strong despite the U.S. Federal Open Market Committee announcing that it would taper asset purchases.
Since the start of 2014, global equity markets have had to contend with multiple headwinds. In Europe, tensions between Ukraine and Russia have had those countries on the brink of war, which could potentially destabilize the region. In the U.S., growth
in the housing market and weakness in retail sales has caused concern that economic growth may be slowing. In Japan, Prime Minister Abe’s decision to raise sales taxes has undermined confidence and caused the Yen to strengthen in value. Finally, China’s currencies depreciated and credit spreads have widened as fears of default and a real estate bubble pressure Chinese equities. Despite these headwinds, U.S. equities have made new all-time highs and European equities have also made multi-year highs. Emerging markets and Japan have lagged their European and U.S. counterparts.
1 | Source: Bloomberg as of 4/30/2014 |
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PKW | Manager’s Analysis | |
PowerShares BuyBack Achievers™ Portfolio (PKW) |
As an index fund, the PowerShares Buyback AchieversTM Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the NASDAQ US Buyback AchieversTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks that comprise the Index.
The NASDAQ OMX Group, Inc. (the “Index Provider”) compiles, maintains and calculates the Index, which is designed to track the performance of issuers that are classified as “BuyBack AchieversTM”. In order to be eligible for inclusion in the Index, an issuer must (i) be incorporated in the United States or certain benefits-driven incorporation countries (i.e., countries that provide tax or other benefits for incorporation); (ii) trade on the NASDAQ, NYSE or NYSE MKT; (iii) have effected a net reduction in shares outstanding of 5% or more in the past 12 months; and (iv) have a minimum average daily cash volume of $500,000 in October, November and December prior to each annual reconstitution of the Underlying Index in January. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider weights the universe of companies according to a modified market capitalization, using each company’s eligible shares outstanding and the closing price at the company’s last trading day in December. No single company may exceed 5% of the Index as of either a reconstitution or rebalance date. The Index Provider will modify the index weight of companies with market capitalizations that exceed 5% of the Index to equal 5% of the Index. The Index Provider will redistribute the excess amounts from companies whose initial market capitalizations exceeded 5% of the Index among the remaining companies in proportion to their initial weights until no company exceeds 5% of the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 26.32%. On a net asset value (“NAV”) basis, the Fund returned 26.36%. During the same time period, the Index returned 27.24%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Index (the “Benchmark Index”) returned 20.44%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 500 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a broad U.S. market benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. equity market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a modified market capitalization weighting methodology and stock selection methodology based on stock buybacks, whereas the Benchmark Index weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the consumer discretionary sector and most underweight in the consumer staples sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to stock selection within the consumer staples sector and consumer discretionary sector, as well as a combination of stock selection within, and allocation to, the telecommunication services sector.
For the fiscal year ended April 30, 2014, the consumer discretionary sector contributed most significantly to the Fund’s return, followed by the financials and health care sectors, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Oracle Corp., a systems software company (portfolio average weight of 4.98%) and Time Warner Cable, Inc., a cable & satellite company (portfolio average weight of 2.19%). Positions that detracted most significantly from the Fund’s return included Iron Mountain Inc., a diversified support services company (no longer held at fiscal year-end); and General Motors Co., an automobile manufacturers company (portfolio average weight of 0.26%.
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Consumer Discretionary | 33.9 | |||
Information Technology | 16.7 | |||
Health Care | 10.9 | |||
Financials | 10.7 | |||
Industrials | 7.2 | |||
Telecommunication Services | 6.4 | |||
Energy | 6.0 | |||
Materials | 5.2 | |||
Consumer Staples | 2.4 | |||
Utilities | 0.6 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.0 |
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PowerShares BuyBack Achievers™ Portfolio (PKW) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
AT&T, Inc. | 5.1 | |||
Home Depot, Inc. (The) | 5.1 | |||
Oracle Corp. | 5.0 | |||
Pfizer, Inc. | 4.9 | |||
General Motors Co. | 3.3 | |||
Halliburton Co. | 3.3 | |||
Lowe’s Cos., Inc. | 2.9 | |||
DIRECTV | 2.4 | |||
Time Warner Cable, Inc. | 2.4 | |||
Yahoo!, Inc. | 2.2 | |||
Total | 36.6 |
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PowerShares BuyBack Achievers™ Portfolio (PKW) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
NASDAQ US BuyBack Achievers™ Index | 27.24 | % | 18.74 | % | 67.41 | % | 23.89 | % | 191.82 | % | 9.53 | % | 95.40 | % | ||||||||||||||||
S&P 500® Index | 20.44 | 13.83 | 47.48 | 19.14 | 140.02 | 6.14 | 55.08 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 26.36 | 17.90 | 63.87 | 23.01 | 181.60 | 8.72 | 85.00 | |||||||||||||||||||||||
Market Price Return | 26.32 | 17.90 | 63.87 | 22.99 | 181.43 | 8.70 | 84.71 |
Fund Inception: December 20, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.71%, including estimated acquired fund fees and expenses of 0.01%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table
above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 6 |
|
PFM | Manager’s Analysis | |
PowerShares Dividend Achievers™ Portfolio (PFM) |
As an index fund, the PowerShares Dividend AchieversTM Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the NASDAQ US Broad Dividend AchieversTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index and that have raised their annual regular cash dividend payments for at least each of the last ten fiscal years.
NASDAQ OMX Group, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. The Index is designed to track the performance of issuers that meet the requirements to be classified as “Dividend AchieversTM.” To become eligible for inclusion in the Index, an issuer must (i) be included in the NASDAQ US Benchmark Index (other than limited partnerships); (ii) for limited partnerships, trade on the NASDAQ, NYSE or NYSE MKT; (iii) have raised its annual regular dividend payments for at least each of the last ten consecutive years; and (iv) have a minimum three-month average daily trading volume of $1 million. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider calculates the total annual regular cash dividend payment for each security in the universe of issuers using the last available ex-dividend date for the previous year. The Index Provider weights the universe of issuers according to a modified market capitalization methodology. The Index Provider will rebalance the Index on a quarterly basis, using each issuer’s closing price on the last trading day in February, May, August and November. At the rebalance date, no single issuer may exceed 4% of the weight of the Index. The Index Provider will redistribute the excess amounts proportionately from larger issuers until no issuer’s weight exceeds 4% of the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 14.17%. On a net asset value (“NAV”) basis, the Fund returned 14.11%. During the same time period, the Index returned 14.75%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Russell 3000® Value Index (the “Benchmark Index”) returned 20.79%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 2,068 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of an index similar to the Index as well as to that of broad based market benchmarks. The Benchmark Index was selected for its recognition in the marketplace, and its performance
comparison is a useful measure for investors as a broad representation of the overall U.S. stock market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a modified market capitalization weighting methodology and stock selection methodology based on dividend-paying stocks, whereas the Benchmark Index weights stocks based on market capitalization and focuses on lower price-to-book and lower forecasted growth values. Additionally, the Fund underperformed largely because of its stock concentrations within the consumer staples, energy, and industrials sectors.
Relative to the Benchmark Index, the Fund was most overweight in the consumer staples sector and most underweight in the telecommunication services sector during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the industrials sector contributed most significantly to the Fund’s return, followed by the energy and consumer staples sectors, respectively. Telecommunication services was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Johnson & Johnson, a health care company (portfolio average weight of 4.71%) and Exxon Mobil Corp., an energy company (portfolio average weight of 4.54%). Positions that detracted most significantly from the Fund’s return included International Business Machines Corp., an information technology company (portfolio average weight of 4.36%); and Target Corp., a consumer discretionary company (portfolio average weight of 0.93%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Consumer Staples | 23.0 | |||
Energy | 16.4 | |||
Industrials | 14.6 | |||
Information Technology | 11.2 | |||
Health Care | 8.0 | |||
Consumer Discretionary | 6.9 | |||
Financials | 6.2 | |||
Utilities | 5.2 | |||
Materials | 5.1 | |||
Telecommunication Services | 3.4 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 7 |
|
PowerShares Dividend Achievers™ Portfolio (PFM) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Johnson & Johnson | 4.2 | |||
Chevron Corp. | 4.2 | |||
Wal-Mart Stores, Inc. | 4.1 | |||
Exxon Mobil Corp. | 4.1 | |||
Procter & Gamble Co. (The) | 4.0 | |||
International Business Machines Corp. | 3.7 | |||
AT&T, Inc. | 3.4 | |||
Coca-Cola Co. (The) | 3.2 | |||
QUALCOMM, Inc. | 2.4 | |||
Intel Corp. | 2.4 | |||
Total | 35.7 |
| 8 |
|
PowerShares Dividend Achievers™ Portfolio (PFM) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
NASDAQ US Broad Dividend Achievers™ Index | 14.75 | % | 13.37 | % | 45.70 | % | 18.17 | % | 130.43 | % | 6.75 | % | 75.59 | % | ||||||||||||||||
Russell 3000® Value Index | 20.79 | 13.91 | 47.82 | 19.49 | 143.62 | 6.78 | 76.04 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 14.11 | 12.73 | 43.24 | 17.45 | 123.45 | 6.09 | 66.47 | |||||||||||||||||||||||
Market Price Return | 14.17 | 12.73 | 43.24 | 17.44 | 123.44 | 6.09 | 66.45 |
Fund Inception: September 15, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.58%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 9 |
|
PGF | Manager’s Analysis | |
PowerShares Financial Preferred Portfolio (PGF) |
As an index fund, the PowerShares Financial Preferred Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Wells Fargo® Hybrid & Preferred Securities Financial Index (the “Index”). The Fund generally will invest at least 90% of its total assets in preferred securities of financial institutions that comprise the Index.
Wells Fargo (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index provider selects constituents for the Index to attempt to portray a cross-section of the universe of preferred securities issued by financial institutions and listed on the NYSE, NYSE MKT or NASDAQ and that meet certain criteria. The Index is composed of preferred securities with either fixed or floating rate dividends issued by financial institutions that have received an industrial sector classification of “financial” from the Bloomberg Professional Service. The Index Provider includes securities in the Index pursuant to a proprietary selection methodology based on a number of criteria including ratings, perpetual maturity, US dollar-denominated, minimum par value of shares outstanding, dividend classification and liquidity requirements. The constituents are then weighted using a modified market capitalization methodology designed to limit the concentration of the largest securities. No security may account for more than 20% of the Index. The Fund does not purchase all of the securities in the Index; instead, the Fund utilizes a “sampling” methodology to seek to achieve its investment objective.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 2.41%. On a net asset value (“NAV”) basis, the Fund returned 2.63%. During the same time period, the Index returned 2.55%. The Fund’s performance differed from the return of the Index primarily due to the Fund’s sampled portfolio’s performance relative to the Index.
During this same time period, the S&P U.S. Preferred Stock Index (the “Benchmark Index”) returned 4.14%. The Benchmark Index is an unmanaged index weighted by modified market capitalization based on the average performance of approximately 300 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a broader preferred stock benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broader representation of the U.S. preferred stock market, which includes convertible preferred stocks.
The Fund focuses on financial sector preferred securities while the Benchmark Index is a broader representation of the preferred stock market. As such, the underperformance of the Fund compared to the Benchmark Index will reflect this difference in
sector focus. In addition, the Benchmark Index contained a large weight in a convertible preferred security (not held by the Fund) which significantly outperformed the overall preferred market during the period.
For the fiscal year ended April 30, 2014, the banks industry contributed most significantly to the Fund’s return, followed by the insurance and diversified financial services, respectively. Capital markets and consumer finance were industries that both detracted equally.
Positions that contributed most significantly to the Fund’s return included HSBC Holdings PLC, a banking industry preferred security (portfolio average weight of 4.26%) and Barclays Bank PLC, a banking industry preferred security (portfolio average weight of 4.28%). Positions that detracted most significantly from the Fund’s return included BB&T Corp., a banking industry preferred security (portfolio average weight of 3.25%); and PNC Financial Services Group Inc., a banking industry preferred security (portfolio average weight of 3.86%).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Banks | 63.2 | |||
Insurance | 12.5 | |||
Capital Markets | 11.6 | |||
Diversified Financial Services | 8.5 | |||
Consumer Finance | 4.5 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.3) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
HSBC Holdings PLC, 8.00%, Series 2 | 7.9 | |||
Barclays Bank PLC, 8.13%, Series 5 | 4.3 | |||
ING Groep NV, 7.38% | 4.1 | |||
HSBC Holdings PLC, 8.13% | 3.7 | |||
Wells Fargo & Co., 8.00%, Series J | 3.6 | |||
PNC Financial Services Group, Inc. (The), 6.13%, Series P | 3.1 | |||
BB&T Corp., 5.63%, Series E | 3.0 | |||
ING Groep NV, 6.38% | 2.4 | |||
Royal Bank of Scotland Group PLC, 7.25%, Series T | 2.4 | |||
Wells Fargo & Co., 5.85% | 2.3 | |||
Total | 36.8 |
| 10 |
|
PowerShares Financial Preferred Portfolio (PGF) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Wells Fargo® Hybrid & Preferred Securities Financial Index | 2.55 | % | 6.85 | % | 21.98 | % | 19.09 | % | 139.54 | % | 4.20 | % | 35.68 | % | ||||||||||||||||
S&P U.S. Preferred Stock Index | 4.14 | 6.77 | 21.72 | 17.23 | 121.41 | 4.60 | 39.57 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 2.63 | 6.25 | 19.96 | 17.59 | 124.81 | 3.10 | 25.43 | |||||||||||||||||||||||
Market Price Return | 2.41 | 6.20 | 19.77 | 17.57 | 124.66 | 2.99 | 24.41 |
Fund Inception: December 1, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.64%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 11 |
|
PEY | Manager’s Analysis | |
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) |
As an index fund, the PowerShares High Yield Equity Dividend AchieversTM Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the NASDAQ US Dividend AchieversTM 50 Index (the “Index”). The Fund generally will invest at least 90% of its total assets in dividend-paying common stocks of companies that have a consistent record of dividend increases and that comprise the Index.
The NASDAQ OMX Group, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes common stocks in the Index, principally on the basis of dividend yield and consistent growth in dividends. To become eligible for inclusion in the Index, an issuer must be included in the NASDAQ US Broad Dividend Achievers TM Index, experienced growth in dividends consistently over the last ten or more calendar or fiscal years, and must have a minimum market capitalization of $1 billion. The company must also be incorporated in the United States, and cannot be a real estate investment trust or limited partnership. Companies are ranked according to yield, using the annualized current dividend and closing price. The top 50 yielding companies within the above universe are included in the Index and weighted according to a dividend yield weighted methodology. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 18.72%. On a net asset value (“NAV”) basis, the Fund returned 18.61%. During the same time period, the Index returned 19.21%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the Dow Jones U.S. Select Dividend Index (the “Benchmark Index”) returned 18.47%. The Benchmark Index is an unmanaged index weighted by indicated dividend yield based on the average performance of approximately 100 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar dividend-weighted index.
The performance of the Fund differed from the Benchmark Index in part because the selection methodology of the Benchmark Index differs from the selection methodology of the Index that the Fund tracks.
Relative to the Benchmark Index, the Fund was most overweight in the financials sector and most underweight in the industrials
sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to stock selection within the financials sector as well as stock selection within the consumer staples sector.
For the fiscal year ended April 30, 2014, the regional banks sub-industry contributed most significantly to the Fund’s return, followed by the office services & supplies and tobacco sub-industries, respectively. The diversified support services sub-industry detracted most significantly from the Fund’s return, followed by the commercial printing sub-industry.
Positions that contributed most significantly to the Fund’s return included Pitney Bowes Inc., an office services & supplies company (no longer held at fiscal year-end) and Vector Group Ltd., a tobacco company (portfolio average weight of 4.69%). Positions that detracted most significantly from the Fund’s return included WGL Holdings, Inc., a gas utilities company (portfolio average weight of 1.86%); and South Jersey Industries, Inc., a gas utilities company (no longer held at fiscal year-end).
Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Gas Utilities | 10.1 | |||
Insurance | 9.9 | |||
Tobacco | 8.9 | |||
Multi-Utilities | 8.4 | |||
Electric Utilities | 6.8 | |||
Commercial Services & Supplies | 6.5 | |||
Oil, Gas & Consumable Fuels | 6.3 | |||
Banks | 5.4 | |||
Semiconductors & Semiconductor Equipment | 5.4 | |||
Household Products | 5.0 | |||
Diversified Telecommunication Services | 3.3 | |||
Hotels, Restaurants & Leisure | 3.2 | |||
Thrifts & Mortgage Finance | 2.4 | |||
Household Durables | 2.0 | |||
Media | 1.8 | |||
Food & Staples Retailing | 1.7 | |||
Pharmaceuticals | 1.7 | |||
Beverages | 1.7 | |||
Food Products | 1.6 | |||
Technology Hardware, Storage & Peripherals | 1.6 | |||
Aerospace & Defense | 1.6 | |||
Metals & Mining | 1.6 | |||
Containers & Packaging | 1.6 | |||
Leisure Products | 1.5 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.0 |
| 12 |
|
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Vector Group Ltd. | 4.2 | |||
AT&T, Inc. | 3.3 | |||
Old Republic International Corp. | 3.2 | |||
Mercury General Corp. | 3.0 | |||
Altria Group, Inc. | 3.0 | |||
Southern Co. (The) | 2.5 | |||
People’s United Financial, Inc. | 2.4 | |||
ConocoPhillips | 2.4 | |||
PPL Corp. | 2.3 | |||
AGL Resources, Inc. | 2.2 | |||
Total | 28.5 |
| 13 |
|
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
NASDAQ US Dividend Achievers™ 50 Index | 19.21 | % | 15.88 | % | 55.60 | % | 20.57 | % | 154.84 | % | 2.74 | % | 28.88 | % | ||||||||||||||||
Dow Jones U.S. Select Dividend Index | 18.47 | 16.12 | 56.57 | 21.28 | 162.38 | 6.94 | 87.85 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 18.61 | 15.24 | 53.03 | 19.88 | 147.61 | 2.30 | 23.83 | |||||||||||||||||||||||
Market Price Return | 18.72 | 15.23 | 53.02 | 19.88 | 147.60 | 2.31 | 23.91 |
Fund Inception: December 9, 2004
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.57%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 14 |
|
PID | Manager’s Analysis | |
PowerShares International Dividend Achievers™ Portfolio (PID) |
As an index fund, the PowerShares International Dividend AchieversTM Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the NASDAQ International Dividend AchieversTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the securities that comprise the Index.
NASDAQ OMX Group, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. The Index is designed to track the performance of dividend paying American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”) that are listed on the London Stock Exchange (“LSE”) and the London International Exchange, in addition to ADRs and non-US common or ordinary stock trading on the NYSE, NYSE MKT, or NASDAQ. In order to become eligible for inclusion in the Index, an issuer must (i) be listed on NASDAQ, NYSE or NYSE MKT; (ii) be incorporated outside of the U.S.; (iii) have raised its annual regular cash dividend payments for at least each of the last five consecutive years; and (iv) have a minimum three-month average daily trading volume of $1 million. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider calculates the total annual regular dividend payment using the last available ex-dividend date for the previous calendar or fiscal year. The Index Provider will rebalance the Index on a quarterly basis using a dividend yield weighted methodology that incorporates the trailing 12-month dividend yield of each issuer as compared to the dividend yield of all issuers in the Index as of the last trading day in February, May, August and November. At the rebalance date, no single issuer may exceed 4% of the Index, and the Index Provider will redistribute the excess amounts proportionately from larger issuers until no issuer’s weight exceeds 4% of the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 11.35%. On a net asset value (“NAV”) basis, the Fund returned 11.50%. During the same time period, the Index returned 11.86%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the MSCI EAFE® Index (the “Benchmark Index”) returned 13.35%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 906 securities. The Fund provided this new comparative benchmark to replace the MSCI EAFE® Value Index, the Fund’s previous benchmark index, because it is a better representation of the international securities held by the Fund. The Fund also provided this additional comparative benchmark to help investors better understand how
the investment results of the Fund compare to the performance of other indices similar to the Index, as well as to that of broad-based market benchmarks. The Benchmark Index also was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the overall international developed equity markets.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks the Index, which employs a dividend yield weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the oil gas & consumable fuels industry and most underweight in the banks industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the selection of stocks within these industries, as well as the allocation to these industries.
For the fiscal year ended April 30, 2014, the health care sector contributed most significantly to the Fund’s return, followed by the energy and financials sectors, respectively. Utilities was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Vodafone Group PLC ADR, a wireless telecommunication services company (portfolio average weight of 3.02%) and AstraZeneca PLC ADR, a pharmaceuticals company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Empresa Nacional de Electricidad S.A. ADR, an independent power producers & energy traders company (no longer held at fiscal year-end); and LukOil OAO ADR, an integrated oil & gas company (portfolio average weight of 3.29%).
Sector Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Energy | 22.7 | |||
Telecommunication Services | 14.9 | |||
Financials | 13.5 | |||
Health Care | 10.2 | |||
Consumer Staples | 10.0 | |||
Industrials | 9.9 | |||
Consumer Discretionary | 8.5 | |||
Materials | 6.0 | |||
Utilities | 2.5 | |||
Information Technology | 1.8 | |||
Money Market Fund Plus Other Assets Less Liabilities | 0.0 |
| 15 |
|
PowerShares International Dividend Achievers™ Portfolio (PID) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Navios Maritime Partners LP | 4.3 | |||
Teekay Offshore Partners LP | 3.4 | |||
Teekay LNG Partners LP | 3.4 | |||
Textainer Group Holdings Ltd. | 2.8 | |||
LUKOIL OAO ADR | 2.7 | |||
BCE, Inc. | 2.6 | |||
Statoil ASA ADR | 2.5 | |||
Brookfield Infrastructure Partners LP | 2.5 | |||
China Mobile Ltd. ADR | 2.3 | |||
Pearson PLC ADR | 2.3 | |||
Total | 28.8 |
| 16 |
|
PowerShares International Dividend Achievers™ Portfolio (PID) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
NASDAQ International Dividend Achievers™ Index | 11.86 | % | 7.37 | % | 23.78 | % | 17.36 | % | 122.60 | % | 6.54 | % | 72.71 | % | ||||||||||||||||
MSCI EAFE® Index—NR | 13.35 | 5.66 | 17.97 | 13.58 | 89.01 | 5.16 | 54.29 | |||||||||||||||||||||||
MSCI EAFE® Value Index—NR | 15.62 | 5.90 | 18.78 | 12.96 | 83.89 | 4.72 | 48.86 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 11.50 | 6.66 | 21.35 | 16.62 | 115.72 | 5.81 | 62.69 | |||||||||||||||||||||||
Market Price Return | 11.35 | 6.61 | 21.18 | 16.62 | 115.69 | 5.82 | 62.84 |
Fund Inception: September 15, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.56%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
NR—Net Return, and is total return net of withholding taxes
| 17 |
|
PowerShares BuyBack Achievers™ Portfolio (PKW)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—33.9% | ||||||||
81,832 | ANN, Inc.(b) | $ | 3,206,996 | |||||
58,828 | AutoZone, Inc.(b) | 31,407,681 | ||||||
69,242 | Bally Technologies, Inc.(b) | 4,508,347 | ||||||
140,182 | bebe Stores, Inc. | 707,919 | ||||||
376,995 | Bed Bath & Beyond, Inc.(b) | 23,422,699 | ||||||
28,361 | Blyth, Inc.(c) | 265,743 | ||||||
43,711 | Bob Evans Farms, Inc. | 2,048,735 | ||||||
118,875 | Brinker International, Inc. | 5,841,517 | ||||||
94,987 | Carter’s, Inc. | 6,996,742 | ||||||
981,428 | CBS Corp., Class B- Non Voting, Class B | 56,687,281 | ||||||
38,971 | Children’s Place Retail Stores, Inc. (The) | 1,870,608 | ||||||
70,555 | Dillard’s, Inc., Class A | 6,909,451 | ||||||
902,889 | DIRECTV(b) | 70,064,186 | ||||||
365,128 | Dollar Tree, Inc.(b) | 19,012,215 | ||||||
95,631 | Fossil Group, Inc.(b) | 10,199,046 | ||||||
791,432 | Gap, Inc. (The) | 31,103,278 | ||||||
2,814,775 | General Motors Co. | 97,053,442 | ||||||
52,217 | hhgregg, Inc.(b)(c) | 450,111 | ||||||
1,848,653 | Home Depot, Inc. (The) | 146,986,400 | ||||||
85,949 | Iconix Brand Group, Inc.(b) | 3,652,832 | ||||||
436,791 | International Game Technology | 5,481,727 | ||||||
369,258 | Kohl’s Corp. | 20,231,646 | ||||||
143,064 | Lear Corp. | 11,882,896 | ||||||
830,568 | Liberty Interactive Corp., Class A(b) | 24,136,306 | ||||||
1,803,779 | Lowe’s Cos., Inc. | 82,811,494 | ||||||
653,366 | Macy’s, Inc. | 37,522,809 | ||||||
32,421 | Marcus Corp. (The) | 542,403 | ||||||
521,995 | Marriott International, Inc., Class A | 30,239,170 | ||||||
54,222 | Martha Stewart Living Omnimedia, Inc., Class A(b) | 212,008 | ||||||
84,286 | Men’s Wearhouse, Inc. (The) | 3,993,471 | ||||||
11,112 | NACCO Industries, Inc., Class A | 595,492 | ||||||
7,954 | NVR, Inc.(b) | 8,566,458 | ||||||
188,382 | O’Reilly Automotive, Inc.(b) | 28,029,358 | ||||||
36,104 | Outerwall, Inc.(b)(c) | 2,503,812 | ||||||
46,644 | Panera Bread Co., Class A(b) | 7,135,133 | ||||||
74,116 | Papa John’s International, Inc. | 3,250,728 | ||||||
93,441 | Rent-A-Center, Inc. | 2,729,412 | ||||||
288,166 | Sally Beauty Holdings, Inc.(b) | 7,898,630 | ||||||
167,810 | Six Flags Entertainment Corp. | 6,735,893 | ||||||
97,287 | Smith & Wesson Holding Corp.(b)(c) | 1,493,355 | ||||||
71,643 | Sonic Automotive, Inc., Class A | 1,743,791 | ||||||
19,198 | Strayer Education, Inc.(b)(c) | 818,411 | ||||||
491,237 | Time Warner Cable, Inc. | 69,490,386 | ||||||
196,102 | TRW Automotive Holdings Corp.(b) | 15,756,796 | ||||||
89,285 | Tupperware Brands Corp. | 7,581,189 | ||||||
684,967 | Viacom, Inc., Class B | 58,208,496 | ||||||
85,686 | Visteon Corp.(b) | 7,438,402 | ||||||
149,897 | Wet Seal, Inc. (The), Class A(b)(c) | 169,384 | ||||||
226,880 | Wyndham Worldwide Corp. | 16,185,619 | ||||||
|
| |||||||
985,779,904 | ||||||||
|
| |||||||
Consumer Staples—2.4% | ||||||||
448,746 | Coca-Cola Enterprises, Inc. | 20,391,018 | ||||||
179,391 | Herbalife Ltd.(c) | 10,759,872 | ||||||
23,831 | Ingles Markets, Inc., Class A | 547,875 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Consumer Staples (continued) | ||||||||
641,297 | Lorillard, Inc. | $ | 38,105,868 | |||||
|
| |||||||
69,804,633 | ||||||||
|
| |||||||
Energy—6.0% | ||||||||
630,280 | Denbury Resources, Inc. | 10,601,310 | ||||||
1,506,489 | Halliburton Co. | 95,014,261 | ||||||
518,511 | Marathon Petroleum Corp. | 48,195,597 | ||||||
231,945 | Tesoro Corp. | 13,056,184 | ||||||
141,164 | Western Refining, Inc.(c) | 6,140,634 | ||||||
|
| |||||||
173,007,986 | ||||||||
|
| |||||||
Financials—10.7% | ||||||||
170,022 | AllianceBernstein Holding LP (France) | 4,323,659 | ||||||
791,605 | Allstate Corp. (The) | 45,081,905 | ||||||
477,695 | American Capital Ltd.(b) | 7,160,648 | ||||||
337,454 | Ameriprise Financial, Inc. | 37,669,990 | ||||||
115,370 | Aspen Insurance Holdings Ltd. | 5,281,639 | ||||||
285,818 | Associated Banc-Corp. | 5,016,106 | ||||||
127,105 | Assurant, Inc. | 8,568,148 | ||||||
323,010 | Assured Guaranty Ltd. | 7,723,169 | ||||||
40,629 | Credit Acceptance Corp.(b) | 5,343,526 | ||||||
68,299 | DFC Global Corp.(b) | 636,547 | ||||||
831,381 | Discover Financial Services | 46,474,198 | ||||||
33,419 | eHealth, Inc.(b) | 1,399,922 | ||||||
83,878 | Everest Re Group Ltd. | 13,255,240 | ||||||
18,543 | FBR & Co.(b) | 478,409 | ||||||
15,202 | First Citizens BancShares, Inc., Class A | 3,418,778 | ||||||
166,798 | First Commonwealth Financial Corp. | 1,432,795 | ||||||
32,562 | First Community Bancshares, Inc. | 482,243 | ||||||
361,804 | Fortress Investment Group LLC, Class A | 2,586,899 | ||||||
210,878 | Legg Mason, Inc. | 9,888,069 | ||||||
177,979 | LPL Financial Holdings, Inc. | 8,427,306 | ||||||
83,493 | Montpelier Re Holdings Ltd. (Bermuda) | 2,553,216 | ||||||
40,045 | MVC Capital, Inc. | 522,187 | ||||||
549,277 | People’s United Financial, Inc. | 7,843,676 | ||||||
28,798 | Piper Jaffray Cos.(b) | 1,263,080 | ||||||
48,577 | Platinum Underwriters Holdings Ltd. | 3,046,264 | ||||||
73,771 | RenaissanceRe Holdings Ltd. | 7,466,363 | ||||||
45,996 | Rockville Financial, Inc.(b) | 605,307 | ||||||
759,025 | SLM Corp.—when issued. | 6,983,469 | ||||||
764,224 | State Street Corp. | 49,338,301 | ||||||
61,324 | Universal Insurance Holdings, Inc. | 897,170 | ||||||
459,361 | Unum Group | 15,259,972 | ||||||
19,362 | World Acceptance Corp.(b)(c) | 1,405,681 | ||||||
|
| |||||||
311,833,882 | ||||||||
|
| |||||||
Health Care—10.9% | ||||||||
137,358 | C.R. Bard, Inc. | 18,863,374 | ||||||
31,387 | Chemed Corp.(c) | 2,613,595 | ||||||
37,048 | Corvel Corp.(b) | 1,687,166 | ||||||
185,997 | Edwards Lifesciences Corp.(b) | 15,153,176 | ||||||
156,892 | HealthSouth Corp. | 5,434,739 | ||||||
91,190 | IDEXX Laboratories, Inc.(b) | 11,530,064 | ||||||
151,027 | Laboratory Corp. of America Holdings(b) | 14,906,365 | ||||||
658,484 | Mylan, Inc.(b) | 33,437,818 | ||||||
129,204 | Myriad Genetics, Inc.(b)(c) | 5,453,701 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 18 |
|
PowerShares BuyBack Achievers™ Portfolio (PKW) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Health Care (continued) | ||||||||
176,670 | Omnicare, Inc. | $ | 10,471,231 | |||||
4,554,293 | Pfizer, Inc. | 142,458,285 | ||||||
33,469 | PhotoMedex, Inc.(b)(c) | 505,717 | ||||||
255,501 | Quest Diagnostics, Inc. | 14,290,171 | ||||||
502,660 | St. Jude Medical, Inc. | 31,903,830 | ||||||
23,936 | SurModics, Inc.(b) | 520,847 | ||||||
172,756 | Tenet Healthcare Corp.(b) | 7,787,840 | ||||||
|
| |||||||
317,017,919 | ||||||||
|
| |||||||
Industrials—7.2% | ||||||||
324,556 | ADT Corp. (The)(c) | 9,814,573 | ||||||
175,393 | AECOM Technology Corp.(b) | 5,686,241 | ||||||
13,922 | American Science & Engineering, Inc. | 935,558 | ||||||
96,816 | Armstrong World Industries, Inc.(b) | 5,088,649 | ||||||
44,332 | Atlas Air Worldwide Holdings, Inc.(b) | 1,551,177 | ||||||
195,645 | Babcock & Wilcox Co. (The) | 6,806,490 | ||||||
260,854 | C.H. Robinson Worldwide, Inc. | 15,364,301 | ||||||
88,184 | CBIZ, Inc.(b) | 755,737 | ||||||
65,533 | Dun & Bradstreet Corp. (The) | 7,258,435 | ||||||
243,602 | Flowserve Corp. | 17,795,126 | ||||||
29,568 | Franklin Covey Co.(b) | 599,343 | ||||||
60,170 | Kforce, Inc. | 1,391,130 | ||||||
153,121 | L-3 Communications Holdings, Inc. | 17,665,570 | ||||||
383,741 | Northrop Grumman Corp. | 46,628,369 | ||||||
148,960 | Oshkosh Corp. | 8,268,770 | ||||||
83,499 | PGT, Inc.(b) | 830,815 | ||||||
56,420 | Pike Corp.(b) | 541,632 | ||||||
1,242,900 | Southwest Airlines Co. | 30,040,893 | ||||||
78,703 | SPX Corp. | 8,015,114 | ||||||
275,744 | Stanley Black & Decker, Inc. | 23,683,652 | ||||||
|
| |||||||
208,721,575 | ||||||||
|
| |||||||
Information Technology—16.7% | ||||||||
1,261,277 | Activision Blizzard, Inc. | 25,238,153 | ||||||
100,289 | ADTRAN, Inc. | 2,249,482 | ||||||
140,675 | AOL, Inc.(b) | 6,022,297 | ||||||
257,953 | Computer Sciences Corp. | 15,265,659 | ||||||
27,136 | Comtech Telecommunications Corp. | 861,568 | ||||||
179,607 | Convergys Corp. | 3,868,735 | ||||||
119,555 | Conversant, Inc.(b) | 2,921,924 | ||||||
95,913 | Dice Holdings, Inc.(b) | 733,734 | ||||||
58,581 | Digital River, Inc.(b) | 895,704 | ||||||
74,558 | DST Systems, Inc. | 6,873,502 | ||||||
249,430 | FLIR Systems, Inc. | 8,490,597 | ||||||
33,657 | Forrester Research, Inc. | 1,192,468 | ||||||
127,339 | Global Payments, Inc. | 8,510,065 | ||||||
174,482 | Harmonic, Inc.(b) | 1,226,608 | ||||||
189,090 | Harris Corp. | 13,901,897 | ||||||
83,568 | Higher One Holdings, Inc.(b) | 500,572 | ||||||
135,317 | IAC/InterActiveCorp. | 8,968,811 | ||||||
287,380 | Lam Research Corp.(b) | 16,555,962 | ||||||
891,287 | Marvell Technology Group Ltd. | 14,135,812 | ||||||
133,230 | MICROS Systems, Inc.(b) | 6,861,345 | ||||||
170,181 | Monster Worldwide, Inc.(b) | 1,172,547 | ||||||
449,866 | Motorola Solutions, Inc. | 28,602,480 | ||||||
108,333 | NeuStar, Inc., Class A(b) | 2,786,325 | ||||||
981,303 | NVIDIA Corp. | 18,124,666 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Information Technology (continued) | ||||||||
3,575,749 | Oracle Corp. | $ | 146,176,619 | |||||
90,918 | Progress Software Corp.(b) | 1,951,100 | ||||||
153,959 | QLogic Corp.(b) | 1,782,845 | ||||||
399,269 | SanDisk Corp. | 33,925,887 | ||||||
137,421 | Silicon Image, Inc.(b) | 770,932 | ||||||
68,442 | Telenav, Inc.(b) | 419,549 | ||||||
88,504 | TeleTech Holdings, Inc.(b) | 2,135,602 | ||||||
249,074 | Vantiv, Inc., Class A(b) | 7,659,026 | ||||||
236,655 | Verisign, Inc.(b) | 11,165,383 | ||||||
70,290 | WebMD Health Corp.(b)(c) | 3,099,086 | ||||||
954,060 | Western Union Co. (The) | 15,140,932 | ||||||
1,787,164 | Yahoo!, Inc.(b) | 64,248,546 | ||||||
|
| |||||||
484,436,420 | ||||||||
|
| |||||||
Materials—5.2% | ||||||||
130,952 | Airgas, Inc. | 13,914,959 | ||||||
140,824 | Albemarle Corp. | 9,440,841 | ||||||
248,987 | Ball Corp. | 13,990,580 | ||||||
107,317 | CF Industries Holdings, Inc. | 26,310,909 | ||||||
37,026 | Clearwater Paper Corp.(b) | 2,273,026 | ||||||
63,327 | Cytec Industries, Inc. | 6,036,330 | ||||||
574,975 | Graphic Packaging Holding Co.(b) | 5,899,243 | ||||||
245,529 | PPG Industries, Inc. | 47,539,325 | ||||||
131,192 | Rockwood Holdings, Inc. | 9,321,192 | ||||||
112,279 | Silgan Holdings, Inc. | 5,585,880 | ||||||
149,804 | Valspar Corp. (The) | 10,941,684 | ||||||
|
| |||||||
151,253,969 | ||||||||
|
| |||||||
Telecommunication Services—6.4% | ||||||||
4,171,197 | AT&T, Inc. | 148,911,733 | ||||||
1,023,290 | CenturyLink, Inc. | 35,723,054 | ||||||
374,503 | Vonage Holdings Corp.(b) | 1,438,091 | ||||||
|
| |||||||
186,072,878 | ||||||||
|
| |||||||
Utilities—0.6% | ||||||||
749,444 | Calpine Corp.(b) | 17,184,751 | ||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $2,679,312,477) | 2,905,113,917 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
974,843 | Invesco Premier Portfolio—Institutional Class(d) (Cost $974,843) | 974,843 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $2,680,287,320)—100.0% | 2,906,088,760 | |||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 19 |
|
PowerShares BuyBack Achievers™ Portfolio (PKW) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—1.2% | ||||||||
34,555,549 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $34,555,549) | $ | 34,555,549 | |||||
|
| |||||||
Total Investments (Cost $2,714,842,869)—101.2% | 2,940,644,309 | |||||||
Other assets less liabilities—(1.2)% | (35,523,770 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 2,905,120,539 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 34,016,807 | $ | (34,016,807 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 20 |
|
Schedule of Investment(a)
PowerShares Dividend Achievers™ Portfolio (PFM)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Consumer Discretionary—6.9% | ||||||||
4,558 | Aaron’s, Inc. | $ | 134,324 | |||||
1,508 | Cracker Barrel Old Country Store, Inc. | 142,868 | ||||||
7,204 | Family Dollar Stores, Inc. | 423,235 | ||||||
9,735 | Genuine Parts Co. | 848,113 | ||||||
8,292 | Hasbro, Inc. | 458,216 | ||||||
3,133 | John Wiley & Sons, Inc., Class A | 180,022 | ||||||
8,796 | Leggett & Platt, Inc. | 289,037 | ||||||
65,286 | Lowe’s Cos., Inc. | 2,997,280 | ||||||
1,731 | Matthews International Corp., Class A | 69,846 | ||||||
62,696 | McDonald’s Corp. | 6,356,121 | ||||||
2,303 | Meredith Corp. | 101,493 | ||||||
44,803 | NIKE, Inc., Class B | 3,268,379 | ||||||
4,162 | Polaris Industries, Inc. | 559,081 | ||||||
13,610 | Ross Stores, Inc. | 926,569 | ||||||
40,129 | Target Corp. | 2,477,966 | ||||||
8,109 | Tiffany & Co. | 709,456 | ||||||
45,088 | TJX Cos., Inc. (The) | 2,623,220 | ||||||
27,929 | VF Corp. | 1,706,183 | ||||||
|
| |||||||
24,271,409 | ||||||||
|
| |||||||
Consumer Staples—23.0% | ||||||||
126,210 | Altria Group, Inc. | 5,062,283 | ||||||
1,786 | Andersons, Inc. (The) | 111,250 | ||||||
41,754 | Archer-Daniels-Midland Co. | 1,825,902 | ||||||
8,152 | Brown-Forman Corp., Class B | 731,398 | ||||||
9,341 | Bunge Ltd. | 744,011 | ||||||
2,437 | Casey’s General Stores, Inc. | 167,324 | ||||||
8,688 | Church & Dwight Co., Inc. | 599,559 | ||||||
8,227 | Clorox Co. (The) | 746,189 | ||||||
279,098 | Coca-Cola Co. (The) | 11,384,407 | ||||||
58,193 | Colgate-Palmolive Co. | 3,916,389 | ||||||
74,892 | CVS Caremark Corp. | 5,446,146 | ||||||
13,210 | Flowers Foods, Inc. | 271,069 | ||||||
39,602 | General Mills, Inc. | 2,099,698 | ||||||
16,697 | Hormel Foods Corp. | 796,280 | ||||||
6,566 | J.M. Smucker Co. (The) | 634,801 | ||||||
24,025 | Kimberly-Clark Corp. | 2,696,806 | ||||||
1,728 | Lancaster Colony Corp. | 163,953 | ||||||
7,536 | McCormick & Co., Inc. | 536,563 | ||||||
3,767 | Nu Skin Enterprises, Inc., Class A | 327,729 | ||||||
96,439 | PepsiCo, Inc. | 8,283,146 | ||||||
171,594 | Procter & Gamble Co. (The) | 14,165,085 | ||||||
37,112 | Sysco Corp. | 1,351,990 | ||||||
2,401 | Tootsie Roll Industries, Inc. | 67,684 | ||||||
1,470 | Universal Corp. | 80,218 | ||||||
5,983 | Vector Group Ltd. | 127,438 | ||||||
60,169 | Walgreen Co. | 4,085,475 | ||||||
180,715 | Wal-Mart Stores, Inc. | 14,404,793 | ||||||
|
| |||||||
80,827,586 | ||||||||
|
| |||||||
Energy—16.4% | ||||||||
2,345 | Alliance Resource Partners LP | 218,390 | ||||||
7,296 | Buckeye Partners LP | 556,028 | ||||||
1,463 | CARBO Ceramics, Inc. | 204,688 | ||||||
117,047 | Chevron Corp. | 14,691,739 | ||||||
77,655 | ConocoPhillips | 5,770,543 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Energy (continued) | ||||||||
4,603 | Energen Corp. | $ | 358,620 | |||||
58,585 | Enterprise Products Partners LP | 4,284,321 | ||||||
34,617 | EOG Resources, Inc. | 3,392,466 | ||||||
140,207 | Exxon Mobil Corp. | 14,358,599 | ||||||
5,614 | Genesis Energy LP | 311,128 | ||||||
6,810 | Helmerich & Payne, Inc. | 739,906 | ||||||
20,257 | Kinder Morgan Energy Partners LP | 1,526,973 | ||||||
14,379 | Magellan Midstream Partners LP | 1,067,065 | ||||||
11,600 | Murphy Oil Corp. | 735,788 | ||||||
50,413 | Occidental Petroleum Corp. | 4,827,045 | ||||||
13,160 | ONEOK, Inc. | 831,975 | ||||||
22,791 | Plains All American Pipeline LP | 1,271,738 | ||||||
6,584 | Sunoco Logistics Partners LP | 598,881 | ||||||
3,947 | TC Pipelines LP | 209,349 | ||||||
43,400 | Williams Cos., Inc. (The) | 1,830,178 | ||||||
|
| |||||||
57,785,420 | ||||||||
|
| |||||||
Financials—6.2% | ||||||||
1,537 | 1st Source Corp. | 45,326 | ||||||
21,347 | ACE Ltd. | 2,184,225 | ||||||
28,905 | Aflac, Inc. | 1,812,922 | ||||||
4,519 | American Equity Investment Life Holding Co. | 105,383 | ||||||
7,096 | Axis Capital Holdings Ltd. | 324,642 | ||||||
971 | BancFirst Corp. | 56,522 | ||||||
2,336 | Bank of the Ozarks, Inc. | 139,926 | ||||||
9,210 | Brown & Brown, Inc. | 274,274 | ||||||
15,580 | Chubb Corp. (The) | 1,434,606 | ||||||
10,354 | Cincinnati Financial Corp. | 504,654 | ||||||
6,077 | Commerce Bancshares, Inc. | 264,228 | ||||||
2,560 | Community Bank System, Inc. | 95,206 | ||||||
1,002 | Community Trust Bancorp, Inc. | 36,944 | ||||||
3,847 | Cullen/Frost Bankers, Inc. | 293,949 | ||||||
7,677 | Eaton Vance Corp. | 276,909 | ||||||
2,938 | Erie Indemnity Co., Class A | 210,508 | ||||||
3,940 | Essex Property Trust, Inc. REIT | 682,644 | ||||||
4,232 | Federal Realty Investment Trust REIT | 497,429 | ||||||
40,000 | Franklin Resources, Inc. | 2,094,000 | ||||||
6,320 | HCC Insurance Holdings, Inc. | 290,341 | ||||||
28,950 | HCP, Inc. REIT | 1,211,847 | ||||||
18,362 | Health Care REIT, Inc. REIT | 1,158,459 | ||||||
728 | Infinity Property & Casualty Corp. | 46,716 | ||||||
17,161 | McGraw-Hill Financial, Inc. | 1,268,713 | ||||||
3,481 | Mercury General Corp. | 166,601 | ||||||
2,093 | National Health Investors, Inc. REIT | 129,117 | ||||||
7,725 | National Retail Properties, Inc. REIT | 263,654 | ||||||
16,334 | Old Republic International Corp. | 270,491 | ||||||
7,867 | OMEGA Healthcare Investors, Inc. REIT | 273,614 | ||||||
3,270 | PartnerRe Ltd. | 344,658 | ||||||
18,928 | People’s United Financial, Inc. | 270,292 | ||||||
4,193 | Prosperity Bancshares, Inc. | 247,387 | ||||||
13,146 | Realty Income Corp. REIT | 571,194 | ||||||
2,638 | RenaissanceRe Holdings Ltd. | 266,992 | ||||||
2,722 | RLI Corp. | 117,209 | ||||||
10,733 | SEI Investments Co. | 347,535 | ||||||
11,916 | Senior Housing Properties Trust REIT | 279,668 | ||||||
1,190 | Southside Bancshares, Inc. | 32,820 | ||||||
2,768 | StanCorp Financial Group, Inc. | 169,125 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 21 |
|
PowerShares Dividend Achievers™ Portfolio (PFM) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Financials (continued) | ||||||||
16,606 | T. Rowe Price Group, Inc. | $ | 1,363,851 | |||||
5,985 | Tanger Factory Outlet Centers, Inc. REIT | 213,545 | ||||||
934 | Tompkins Financial Corp. | 44,029 | ||||||
2,865 | UMB Financial Corp. | 168,204 | ||||||
4,353 | United Bankshares, Inc. | 127,325 | ||||||
814 | Universal Health Realty Income Trust REIT | 34,538 | ||||||
1,495 | Urstadt Biddle Properties, Inc., Class A REIT | 30,513 | ||||||
8,140 | W.R. Berkley Corp. | 360,114 | ||||||
1,672 | Westamerica Bancorp. | 84,971 | ||||||
523 | Westwood Holdings Group, Inc. | 30,423 | ||||||
6,267 | WP Carey, Inc. REIT | 385,295 | ||||||
|
| |||||||
21,903,538 | ||||||||
|
| |||||||
Health Care—8.0% | ||||||||
97,787 | Abbott Laboratories | 3,788,268 | ||||||
12,245 | Becton, Dickinson and Co. | 1,384,052 | ||||||
4,913 | C.R. Bard, Inc. | 674,702 | ||||||
21,749 | Cardinal Health, Inc. | 1,511,773 | ||||||
146,527 | Johnson & Johnson | 14,841,720 | ||||||
63,228 | Medtronic, Inc. | 3,719,071 | ||||||
3,996 | Owens & Minor, Inc. | 134,026 | ||||||
23,961 | Stryker Corp. | 1,862,968 | ||||||
4,454 | West Pharmaceutical Services, Inc. | 193,215 | ||||||
|
| |||||||
28,109,795 | ||||||||
|
| |||||||
Industrials—14.6% | ||||||||
41,973 | 3M Co. | 5,838,025 | ||||||
4,941 | A.O. Smith Corp. | 231,041 | ||||||
3,533 | ABM Industries, Inc. | 95,709 | ||||||
3,092 | Brady Corp., Class A | 79,743 | ||||||
9,602 | C.H. Robinson Worldwide, Inc. | 565,558 | ||||||
4,043 | Carlisle Cos., Inc. | 332,537 | ||||||
40,393 | Caterpillar, Inc. | 4,257,422 | ||||||
7,590 | Cintas Corp. | 447,279 | ||||||
3,192 | CLARCOR, Inc. | 184,370 | ||||||
23,440 | Deere & Co. | 2,187,890 | ||||||
9,201 | Donaldson Co., Inc. | 387,270 | ||||||
10,766 | Dover Corp. | 930,182 | ||||||
44,513 | Emerson Electric Co. | 3,034,896 | ||||||
12,833 | Expeditors International of Washington, Inc. | 529,233 | ||||||
18,793 | Fastenal Co. | 941,153 | ||||||
19,794 | FedEx Corp. | 2,696,933 | ||||||
3,020 | Franklin Electric Co., Inc. | 116,783 | ||||||
21,700 | General Dynamics Corp. | 2,375,065 | ||||||
1,662 | Gorman-Rupp Co. (The) | 51,605 | ||||||
3,854 | Graco, Inc. | 279,415 | ||||||
4,440 | Healthcare Services Group, Inc. | 129,204 | ||||||
26,937 | Illinois Tool Works, Inc. | 2,295,841 | ||||||
5,788 | ITT Corp. | 249,694 | ||||||
5,130 | Lincoln Electric Holdings, Inc. | 342,735 | ||||||
818 | Lindsay Corp. | 72,090 | ||||||
20,373 | Lockheed Martin Corp. | 3,344,024 | ||||||
1,631 | McGrath RentCorp | 51,507 | ||||||
2,357 | MSA Safety, Inc. | 124,332 | ||||||
3,039 | MSC Industrial Direct Co., Inc., Class A | 276,731 | ||||||
4,075 | Nordson Corp. | 302,976 | ||||||
19,639 | Norfolk Southern Corp. | 1,856,475 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Industrials (continued) | ||||||||
13,746 | Northrop Grumman Corp. | $ | 1,670,277 | |||||
9,444 | Parker Hannifin Corp. | 1,198,255 | ||||||
12,498 | Pentair Ltd. | 928,476 | ||||||
2,306 | Raven Industries, Inc. | 71,255 | ||||||
22,836 | Republic Services, Inc. | 801,315 | ||||||
9,251 | Rollins, Inc. | 278,270 | ||||||
6,304 | Roper Industries, Inc. | 875,941 | ||||||
9,854 | Stanley Black & Decker, Inc. | 846,360 | ||||||
1,171 | Tennant Co. | 74,698 | ||||||
3,597 | Toro Co. (The) | 228,553 | ||||||
57,969 | United Technologies Corp. | 6,859,472 | ||||||
1,699 | Valmont Industries, Inc. | 252,998 | ||||||
4,357 | W.W. Grainger, Inc. | 1,108,421 | ||||||
29,435 | Waste Management, Inc. | 1,308,386 | ||||||
|
| |||||||
51,110,395 | ||||||||
|
| |||||||
Information Technology—11.2% | ||||||||
19,791 | Analog Devices, Inc. | 1,015,080 | ||||||
30,549 | Automatic Data Processing, Inc. | 2,381,600 | ||||||
912 | Badger Meter, Inc. | 45,190 | ||||||
729 | Cass Information Systems, Inc. | 36,822 | ||||||
4,043 | Diebold, Inc. | 152,057 | ||||||
2,709 | FactSet Research Systems, Inc. | 288,508 | ||||||
6,763 | Harris Corp. | 497,216 | ||||||
314,939 | Intel Corp. | 8,405,722 | ||||||
65,965 | International Business Machines Corp. | 12,960,144 | ||||||
5,413 | Jack Henry & Associates, Inc. | 298,581 | ||||||
14,940 | Linear Technology Corp. | 664,830 | ||||||
17,862 | Maxim Integrated Products, Inc. | 579,443 | ||||||
218 | Mesa Laboratories, Inc. | 18,683 | ||||||
12,610 | Microchip Technology, Inc. | 599,479 | ||||||
107,117 | QUALCOMM, Inc. | 8,431,179 | ||||||
68,657 | Texas Instruments, Inc. | 3,120,461 | ||||||
|
| |||||||
39,494,995 | ||||||||
|
| |||||||
Materials—5.1% | ||||||||
13,425 | Air Products & Chemicals, Inc. | 1,577,706 | ||||||
4,684 | Airgas, Inc. | 497,722 | ||||||
5,034 | Albemarle Corp. | 337,479 | ||||||
4,150 | AptarGroup, Inc. | 279,793 | ||||||
6,440 | Bemis Co., Inc. | 259,146 | ||||||
19,072 | Ecolab, Inc. | 1,995,694 | ||||||
3,170 | H.B. Fuller Co. | 146,866 | ||||||
5,147 | International Flavors & Fragrances, Inc. | 507,082 | ||||||
33,242 | Monsanto Co. | 3,679,889 | ||||||
20,161 | Nucor Corp. | 1,043,332 | ||||||
8,784 | PPG Industries, Inc. | 1,700,758 | ||||||
18,637 | Praxair, Inc. | 2,433,060 | ||||||
4,081 | Royal Gold, Inc. | 270,162 | ||||||
8,433 | RPM International, Inc. | 359,752 | ||||||
6,351 | Sherwin-Williams Co. (The) | 1,269,184 | ||||||
7,564 | Sigma-Aldrich Corp. | 727,732 | ||||||
6,456 | Sonoco Products Co. | 271,669 | ||||||
1,415 | Stepan Co. | 81,830 | ||||||
5,408 | Valspar Corp. (The) | 395,000 | ||||||
|
| |||||||
17,833,856 | ||||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 22 |
|
PowerShares Dividend Achievers™ Portfolio (PFM) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Telecommunication Services—3.4% | ||||||||
329,841 | AT&T, Inc. | $ | 11,775,324 | |||||
998 | Atlantic Tele-Network, Inc. | 59,052 | ||||||
6,434 | Telephone & Data Systems, Inc. | 174,940 | ||||||
|
| |||||||
12,009,316 | ||||||||
|
| |||||||
Utilities—5.2% | ||||||||
7,529 | AGL Resources, Inc. | 406,566 | ||||||
7,026 | Alliant Energy Corp. | 410,880 | ||||||
2,454 | American States Water Co. | 74,503 | ||||||
11,190 | Aqua America, Inc. | 280,757 | ||||||
6,267 | Atmos Energy Corp. | 319,868 | ||||||
3,807 | Avista Corp. | 122,395 | ||||||
2,818 | Black Hills Corp. | 162,739 | ||||||
3,023 | California Water Service Group | 68,018 | ||||||
610 | Chesapeake Utilities Corp. | 38,589 | ||||||
698 | Connecticut Water Service, Inc. | 22,685 | ||||||
18,548 | Consolidated Edison, Inc. | 1,076,340 | ||||||
36,820 | Dominion Resources, Inc. | 2,670,923 | ||||||
2,074 | Laclede Group, Inc. (The) | 98,328 | ||||||
11,992 | MDU Resources Group, Inc. | 424,757 | ||||||
2,195 | MGE Energy, Inc. | 83,893 | ||||||
5,305 | National Fuel Gas Co. | 390,660 | ||||||
2,668 | New Jersey Resources Corp. | 132,680 | ||||||
27,567 | NextEra Energy, Inc. | 2,752,565 | ||||||
19,975 | Northeast Utilities | 944,019 | ||||||
1,716 | Northwest Natural Gas Co. | 75,967 | ||||||
4,926 | Piedmont Natural Gas Co., Inc. | 176,302 | ||||||
39,940 | PPL Corp. | 1,331,600 | ||||||
11,089 | Questar Corp. | 269,241 | ||||||
8,938 | SCANA Corp. | 479,792 | ||||||
2,073 | South Jersey Industries, Inc. | 119,094 | ||||||
56,227 | Southern Co. (The) | 2,576,883 | ||||||
7,267 | UGI Corp. | 339,296 | ||||||
5,219 | Vectren Corp. | 211,735 | ||||||
8,156 | Westar Energy, Inc. | 292,637 | ||||||
3,284 | WGL Holdings, Inc. | 130,670 | ||||||
14,308 | Wisconsin Energy Corp. | 693,652 | ||||||
31,554 | Xcel Energy, Inc. | 1,005,626 | ||||||
|
| |||||||
18,183,660 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $276,926,901) | 351,529,970 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
6,276 | Invesco Premier Portfolio—Institutional Class(b) (Cost $6,276) | 6,276 | ||||||
|
| |||||||
Total Investments (Cost $276,933,177)—100.0% | 351,536,246 | |||||||
Other assets less liabilities—0.0% | 20,715 | |||||||
|
| |||||||
Net Assets—100.0% | $ | 351,556,961 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 23 |
|
Schedule of Investment(a)
PowerShares Financial Preferred Portfolio (PGF)
April 30, 2014
Number of Shares | Value | |||||||
Preferred Stocks—100.3% | ||||||||
Banks—63.2% | ||||||||
564,730 | Bank of America Corp., 6.20%, Series D(b) | $ | 14,084,366 | |||||
77,532 | Bank of America Corp., 6.38%, Series 3 | 1,954,582 | ||||||
20,129 | Bank of America Corp., 7.25%, Series L | 22,911,834 | ||||||
751,262 | Barclays Bank PLC, 6.63%, Series 2 (United Kingdom) | 19,089,567 | ||||||
831,869 | Barclays Bank PLC, 7.10%, Series 3 (United Kingdom) | 21,354,077 | ||||||
613,646 | Barclays Bank PLC, 7.75%, Series 4 (United Kingdom) | 15,905,704 | ||||||
2,363,789 | Barclays Bank PLC, 8.13%, Series 5 (United Kingdom)(b) | 61,245,773 | ||||||
120,283 | BB&T Corp., 5.20%, Series G(b) | 2,646,226 | ||||||
1,819,496 | BB&T Corp., 5.63%, Series E | 42,485,232 | ||||||
395,237 | BB&T Corp., 5.85% | 9,687,259 | ||||||
694,621 | Citigroup, Inc., 5.80%, Series C(b) | 16,302,755 | ||||||
1,047,982 | Citigroup, Inc., 6.88%, Series K | 28,117,357 | ||||||
816,540 | Citigroup, Inc., 7.13%, Series J | 22,169,061 | ||||||
380,777 | Fifth Third Bancorp, 6.63%, Series I | 10,113,437 | ||||||
313,565 | First Niagara Financial Group, Inc., 8.63%, Series B | 9,102,792 | ||||||
490,127 | HSBC Finance Corp., 6.36%, Series B (United Kingdom) | 12,248,274 | ||||||
4,180,073 | HSBC Holdings PLC, 8.00%, Series 2 (United Kingdom) | 112,861,971 | ||||||
2,004,304 | HSBC Holdings PLC, 8.13% (United Kingdom) | 52,452,636 | ||||||
843,095 | JPMorgan Chase & Co., 5.45%, Series P(b) | 19,070,809 | ||||||
1,253,429 | JPMorgan Chase & Co., 5.50%, Series O | 28,440,304 | ||||||
547,435 | JPMorgan Chase & Co., 6.70%, Series T | 13,882,952 | ||||||
1,636,446 | PNC Financial Services Group, Inc. (The), 6.13%, Series P | 43,954,939 | ||||||
441,326 | Regions Financial Corp., 6.38%, Series A | 10,618,303 | ||||||
410,000 | Regions Financial Corp., 6.38%, Series B(c) | 10,188,500 | ||||||
432,417 | Royal Bank of Scotland Group PLC, 5.75%, Series L (United Kingdom) | 9,616,954 | ||||||
329,033 | Royal Bank of Scotland Group PLC, 6.35%, Series N (United Kingdom) | 7,554,598 | ||||||
367,501 | Royal Bank of Scotland Group PLC, 6.60%, Series S (United Kingdom) | 8,801,649 | ||||||
317,109 | Royal Bank of Scotland Group PLC, 6.75%, Series Q (United Kingdom) | 7,693,064 | ||||||
1,331,863 | Royal Bank of Scotland Group PLC, 7.25%, Series T (United Kingdom) | 33,816,002 | ||||||
720,618 | Santander Finance Preferred SAU, 10.50%, Series 10 (Spain) | 18,865,779 | ||||||
444,383 | SunTrust Banks, Inc., 5.88%, Series E | 10,274,135 | ||||||
820,170 | U.S. Bancorp, 5.15%, Series H | 18,552,245 | ||||||
588,858 | U.S. Bancorp, 6.00%, Series G | 16,311,367 | ||||||
1,028,453 | U.S. Bancorp, 6.50%, Series F | 29,670,869 | ||||||
51,446 | Wells Fargo & Co., 5.13%, Series O | 1,164,223 | ||||||
991,987 | Wells Fargo & Co., 5.20% | 22,369,307 | ||||||
436,199 | Wells Fargo & Co., 5.25%, Series P(b) | 10,159,075 | ||||||
1,330,111 | Wells Fargo & Co., 5.85% | 33,718,314 | ||||||
166,349 | Wells Fargo & Co., 6.63% | 4,599,550 | ||||||
17,140 | Wells Fargo & Co., 7.50%, Series L | 20,482,300 | ||||||
1,757,014 | Wells Fargo & Co., 8.00%, Series J | 51,884,623 | ||||||
|
| |||||||
906,422,764 | ||||||||
|
|
Number of Shares | Value | |||||||
Preferred Stocks (continued) | ||||||||
Capital Markets—11.6% | ||||||||
584,127 | Bank of New York Mellon Corp. (The), 5.20% | $ | 13,715,302 | |||||
450,323 | Charles Schwab Corp. (The), 6.00%, Series B | 11,411,185 | ||||||
835,475 | Goldman Sachs Group, Inc. (The), 5.50%, Series J | 19,742,274 | ||||||
976,503 | Goldman Sachs Group, Inc. (The), 5.95% | 22,625,574 | ||||||
688,267 | Goldman Sachs Group, Inc. (The), 6.20%, Series B(b) | 16,979,547 | ||||||
220,000 | Goldman Sachs Group, Inc. (The), 6.38%, Series K(b)(c) | 5,561,600 | ||||||
270,000 | Morgan Stanley, 6.63%, Series G(c) | 6,750,000 | ||||||
763,874 | Morgan Stanley, 6.88% | 20,311,410 | ||||||
818,689 | Morgan Stanley, 7.13%, Series E | 22,350,210 | ||||||
550,261 | State Street Corp., 5.25%, Series C(b) | 12,958,647 | ||||||
563,646 | State Street Corp., 5.90%, Series D(c) | 14,632,250 | ||||||
|
| |||||||
167,037,999 | ||||||||
|
| |||||||
Consumer Finance—4.5% | ||||||||
828,764 | Ally Financial, Inc., 8.50%, Series A | 22,409,779 | ||||||
787,431 | Capital One Financial Corp., 6.00%, Series B | 18,906,218 | ||||||
506,621 | Discover Financial Services, 6.50%, Series B | 12,766,849 | ||||||
423,029 | HSBC USA, Inc., 6.50%, Series H (United Kingdom) | 10,783,009 | ||||||
|
| |||||||
64,865,855 | ||||||||
|
| |||||||
Diversified Financial Services—8.5% | ||||||||
687,348 | ING Groep NV, 6.13% (Netherlands) | 17,286,802 | ||||||
160,481 | ING Groep NV, 6.20% (Netherlands)(b) | 4,050,541 | ||||||
1,337,436 | ING Groep NV, 6.38% (Netherlands) | 33,957,500 | ||||||
2,291,586 | ING Groep NV, 7.38% (Netherlands) | 59,214,582 | ||||||
278,101 | KKR Financial Holdings LLC, 7.38%, Series A | 7,049,860 | ||||||
|
| |||||||
121,559,285 | ||||||||
|
| |||||||
Insurance—12.5% | ||||||||
701,114 | Aegon NV, 6.38% (Netherlands) | 18,137,819 | ||||||
241,812 | Aegon NV, 6.50% (Netherlands) | 6,151,697 | ||||||
1,128,247 | Aegon NV, 7.25% (Netherlands) | 28,668,756 | ||||||
306,606 | Allstate Corp. (The), 5.63% | 7,471,988 | ||||||
601,964 | Allstate Corp. (The), 6.63%, Series E(c) | 15,536,691 | ||||||
278,123 | Allstate Corp. (The), 6.75%, Series C | 7,225,636 | ||||||
291,605 | Arch Capital Group Ltd., 6.75%, Series C | 7,491,332 | ||||||
254,527 | Aspen Insurance Holdings Ltd., 5.95% | 6,424,262 | ||||||
388,100 | Axis Capital Holdings Ltd., 6.88%, Series C | 10,024,623 | ||||||
1,258,004 | MetLife, Inc., 6.50%, Series B | 31,978,462 | ||||||
96,007 | PartnerRe Ltd., 5.88%, Series F | 2,260,005 | ||||||
470,751 | PartnerRe Ltd., 7.25%, Series E | 12,714,985 | ||||||
258,193 | Principal Financial Group, Inc., 6.52%, Series B | 6,609,741 | ||||||
301,969 | Prudential PLC, 6.50% (United Kingdom) | 7,784,761 | ||||||
191,467 | Prudential PLC, 6.75% (United Kingdom) | 4,918,787 | ||||||
288,354 | RenaissanceRe Holdings Ltd., 5.38%, Series E | 6,286,117 | ||||||
|
| |||||||
179,685,662 | ||||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $1,351,032,678)—100.3% | 1,439,571,565 | |||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 24 |
|
PowerShares Financial Preferred Portfolio (PGF) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—0.6% | ||||||||
8,506,770 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $8,506,770) | $ | 8,506,770 | |||||
|
| |||||||
Total Investments (Cost $1,359,539,448)—100.9% | 1,448,078,335 | |||||||
Other assets less liabilities—(0.9)% | (12,520,060 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 1,435,558,275 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | All or a portion of this security was out on loan at April 30, 2014. |
(c) | Non-income producing security. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 8,326,823 | $ | (8,326,823 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
This Fund has holdings greater than 10% of net assets in the following countries:
United Kingdom | 26.9 | % | ||
Netherlands | 11.7 | % |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 25 |
|
Schedule of Investment(a)
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Aerospace & Defense—1.6% | ||||||||
38,884 | Lockheed Martin Corp. | $ | 6,382,420 | |||||
|
| |||||||
Banks—5.4% | ||||||||
171,157 | Community Bank System, Inc. | 6,365,329 | ||||||
298,025 | United Bankshares, Inc. | 8,717,231 | ||||||
122,525 | Westamerica Bancorp.(b) | 6,226,720 | ||||||
|
| |||||||
21,309,280 | ||||||||
|
| |||||||
Beverages—1.7% | ||||||||
158,492 | Coca-Cola Co. (The) | 6,464,889 | ||||||
|
| |||||||
Commercial Services & Supplies—6.5% | ||||||||
222,210 | Brady Corp., Class A | 5,730,796 | ||||||
189,199 | McGrath RentCorp | 5,974,904 | ||||||
175,707 | Republic Services, Inc. | 6,165,559 | ||||||
175,055 | Waste Management, Inc. | 7,781,195 | ||||||
|
| |||||||
25,652,454 | ||||||||
|
| |||||||
Containers & Packaging—1.6% | ||||||||
145,301 | Sonoco Products Co. | 6,114,266 | ||||||
|
| |||||||
Diversified Telecommunication Services—3.3% | ||||||||
366,614 | AT&T, Inc. | 13,088,120 | ||||||
|
| |||||||
Electric Utilities—6.8% | ||||||||
267,757 | PPL Corp. | 8,927,018 | ||||||
214,954 | Southern Co. (The) | 9,851,342 | ||||||
220,566 | Westar Energy, Inc. | 7,913,908 | ||||||
|
| |||||||
26,692,268 | ||||||||
|
| |||||||
Food & Staples Retailing—1.7% | ||||||||
179,853 | Sysco Corp. | 6,552,045 | ||||||
|
| |||||||
Food Products—1.6% | ||||||||
121,277 | General Mills, Inc. | 6,430,106 | ||||||
|
| |||||||
Gas Utilities—10.1% | ||||||||
163,073 | AGL Resources, Inc. | 8,805,942 | ||||||
154,933 | Laclede Group, Inc. (The) | 7,345,374 | ||||||
189,101 | Northwest Natural Gas Co. | 8,371,501 | ||||||
205,889 | Piedmont Natural Gas Co., Inc. | 7,368,767 | ||||||
197,531 | WGL Holdings, Inc. | 7,859,759 | ||||||
|
| |||||||
39,751,343 | ||||||||
|
| |||||||
Hotels, Restaurants & Leisure—3.2% | ||||||||
57,418 | Cracker Barrel Old Country Store, Inc. | 5,439,782 | ||||||
72,077 | McDonald’s Corp. | 7,307,166 | ||||||
|
| |||||||
12,746,948 | ||||||||
|
| |||||||
Household Durables—2.0% | ||||||||
237,221 | Leggett & Platt, Inc. | 7,795,082 | ||||||
|
| |||||||
Household Products—5.0% | ||||||||
75,091 | Clorox Co. (The) | 6,810,754 | ||||||
54,944 | Kimberly-Clark Corp. | 6,167,464 | ||||||
80,300 | Procter & Gamble Co. (The) | 6,628,765 | ||||||
|
| |||||||
19,606,983 | ||||||||
|
| |||||||
Insurance—9.9% | ||||||||
155,508 | Cincinnati Financial Corp. | 7,579,460 | ||||||
94,569 | Erie Indemnity Co., Class A | 6,775,869 | ||||||
246,797 | Mercury General Corp. | 11,811,704 | ||||||
769,759 | Old Republic International Corp. | 12,747,209 | ||||||
|
| |||||||
38,914,242 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Leisure Products—1.5% | ||||||||
108,590 | Hasbro, Inc. | $ | 6,000,683 | |||||
|
| |||||||
Media—1.8% | ||||||||
156,041 | Meredith Corp. | 6,876,727 | ||||||
|
| |||||||
Metals & Mining—1.6% | ||||||||
120,472 | Nucor Corp. | 6,234,426 | ||||||
|
| |||||||
Multi-Utilities—8.4% | ||||||||
267,154 | Avista Corp. | 8,589,001 | ||||||
149,620 | Consolidated Edison, Inc. | 8,682,449 | ||||||
157,343 | SCANA Corp. | 8,446,172 | ||||||
183,507 | Vectren Corp. | 7,444,879 | ||||||
|
| |||||||
33,162,501 | ||||||||
|
| |||||||
Oil, Gas & Consumable Fuels—6.3% | ||||||||
62,099 | Chevron Corp. | 7,794,667 | ||||||
127,482 | ConocoPhillips | 9,473,187 | ||||||
174,035 | Williams Cos., Inc. (The) | 7,339,056 | ||||||
|
| |||||||
24,606,910 | ||||||||
|
| |||||||
Pharmaceuticals—1.7% | ||||||||
64,244 | Johnson & Johnson | 6,507,275 | ||||||
|
| |||||||
Semiconductors & Semiconductor Equipment—5.4% | ||||||||
303,155 | Intel Corp. | 8,091,207 | ||||||
196,866 | Maxim Integrated Products, Inc. | 6,386,333 | ||||||
141,032 | Microchip Technology, Inc. | 6,704,661 | ||||||
|
| |||||||
21,182,201 | ||||||||
|
| |||||||
Technology Hardware, Storage & Peripherals—1.6% | ||||||||
169,866 | Diebold, Inc. | 6,388,660 | ||||||
|
| |||||||
Thrifts & Mortgage Finance—2.4% | ||||||||
668,497 | People’s United Financial, Inc. | 9,546,137 | ||||||
|
| |||||||
Tobacco—8.9% | ||||||||
288,993 | Altria Group, Inc. | 11,591,509 | ||||||
124,890 | Universal Corp. | 6,815,248 | ||||||
771,911 | Vector Group Ltd.(b) | 16,441,704 | ||||||
|
| |||||||
34,848,461 | ||||||||
|
| |||||||
Total Common Stocks (Cost $350,565,075) | 392,854,427 | |||||||
|
| |||||||
Money Market Fund—0.3% | ||||||||
1,137,138 | Invesco Premier Portfolio—Institutional Class(c) (Cost $1,137,138) | 1,137,138 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $351,702,213)—100.3% | 393,991,565 | |||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 26 |
|
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—3.0% | ||||||||
11,939,200 | Invesco Liquid Assets Portfolio—Institutional Class(c)(d) (Cost $11,939,200) | $ | 11,939,200 | |||||
|
| |||||||
Total Investments (Cost $363,641,413)—103.3% | 405,930,765 | |||||||
Other assets less liabilities—(3.3)% | (12,827,658 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 393,103,107 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | All or a portion of this security was out on loan at April 30, 2014. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(d) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 11,773,515 | $ | (11,773,515 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 27 |
|
Schedule of Investments
PowerShares International Dividend Achievers™ Portfolio (PID)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Australia—1.7% | ||||||||
283,717 | BHP Billiton Ltd. ADR(a) | $ | 20,013,397 | |||||
|
| |||||||
Bermuda—0.9% | ||||||||
335,686 | Montpelier Re Holdings Ltd. | 10,265,278 | ||||||
|
| |||||||
Brazil—0.6% | ||||||||
154,576 | Cia Brasileira de Distribuicao Grupo Pao de Acucar ADR | 7,351,635 | ||||||
|
| |||||||
Canada—20.9% | ||||||||
687,561 | BCE, Inc. | 30,623,967 | ||||||
149,491 | Canadian National Railway Co. | 8,755,688 | ||||||
239,852 | Canadian Natural Resources Ltd. | 9,778,766 | ||||||
31,743 | Canadian Pacific Railway Ltd. | 4,950,956 | ||||||
401,008 | Enbridge, Inc. | 19,364,676 | ||||||
159,765 | Franco-Nevada Corp. | 7,695,880 | ||||||
549,934 | Ritchie Bros. Auctioneers, Inc.(a) | 13,748,350 | ||||||
652,842 | Rogers Communications, Inc., Class B(a) | 25,930,884 | ||||||
1,060,745 | Shaw Communications, Inc., Class B(a) | 25,701,851 | ||||||
414,700 | Suncor Energy, Inc. | 16,007,420 | ||||||
606,516 | TELUS Corp. | 21,391,819 | ||||||
642,459 | Thomson Reuters Corp. | 23,244,167 | ||||||
204,789 | Tim Hortons, Inc. | 11,240,868 | ||||||
529,185 | TransCanada Corp. | 24,675,897 | ||||||
|
| |||||||
243,111,189 | ||||||||
|
| |||||||
China—4.6% | ||||||||
574,979 | China Mobile Ltd. ADR | 27,271,254 | ||||||
292,805 | China Petroleum & Chemical Corp. ADR(a) | 26,021,580 | ||||||
|
| |||||||
53,292,834 | ||||||||
|
| |||||||
Colombia—1.8% | ||||||||
362,551 | Bancolombia SA ADR | 20,640,029 | ||||||
|
| |||||||
Denmark—0.6% | ||||||||
159,416 | Novo Nordisk A/S ADR | 7,235,892 | ||||||
|
| |||||||
France—1.8% | ||||||||
387,228 | Sanofi ADR | 20,832,866 | ||||||
|
| |||||||
Germany—0.7% | ||||||||
236,371 | Fresenius Medical Care AG & Co. KGaA ADR(a) | 8,119,344 | ||||||
|
| |||||||
India—1.9% | ||||||||
403,167 | Axis Bank Ltd. GDR | 10,200,125 | ||||||
142,175 | HDFC Bank Ltd. ADR | 5,694,109 | ||||||
119,905 | Infosys Ltd. ADR | 6,440,097 | ||||||
|
| |||||||
22,334,331 | ||||||||
|
| |||||||
Ireland—0.2% | ||||||||
11,226 | Shire PLC ADR | 1,928,066 | ||||||
|
| |||||||
Israel—1.3% | ||||||||
305,263 | Teva Pharmaceutical Industries Ltd. ADR | 14,915,150 | ||||||
|
| |||||||
Japan—3.2% | ||||||||
579,765 | Nippon Telegraph & Telephone Corp. ADR | 16,140,658 | ||||||
1,280,321 | NTT DOCOMO, Inc. ADR | 20,459,529 | ||||||
|
| |||||||
36,600,187 | ||||||||
|
| |||||||
Jersey—0.3% | ||||||||
46,462 | Randgold Resources Ltd. ADR | 3,720,212 | ||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Mexico—2.3% | ||||||||
533,476 | America Movil SAB de CV, Series L ADR | $ | 10,712,198 | |||||
141,877 | Coca-Cola Femsa SAB de CV ADR(a) | 15,884,549 | ||||||
|
| |||||||
26,596,747 | ||||||||
|
| |||||||
Netherlands—2.0% | ||||||||
533,098 | Unilever NV | 22,827,256 | ||||||
|
| |||||||
Norway—2.5% | ||||||||
958,093 | Statoil ASA ADR | 29,193,094 | ||||||
|
| |||||||
Russia—4.4% | ||||||||
588,638 | LUKOIL OAO ADR | 31,109,518 | ||||||
3,098,707 | Rosneft Oil Co. GDR | 19,438,189 | ||||||
|
| |||||||
50,547,707 | ||||||||
|
| |||||||
Switzerland—3.2% | ||||||||
228,105 | Novartis AG ADR | 19,831,449 | ||||||
223,103 | Syngenta AG ADR | 17,524,740 | ||||||
|
| |||||||
37,356,189 | ||||||||
|
| |||||||
United Kingdom—16.5% | ||||||||
52,794 | ARM Holdings PLC ADR | 2,403,183 | ||||||
326,978 | BHP Billiton PLC ADR(a) | 21,155,477 | ||||||
212,685 | British American Tobacco PLC ADR | 24,463,029 | ||||||
117,277 | Diageo PLC ADR | 14,399,270 | ||||||
458,072 | GlaxoSmithKline PLC ADR | 25,363,447 | ||||||
1,428,501 | Pearson PLC ADR(a) | 26,812,964 | ||||||
263,999 | Prudential PLC ADR(a) | 12,194,114 | ||||||
121,734 | Smith & Nephew PLC ADR | 9,487,948 | ||||||
495,583 | Unilever PLC ADR(a) | 22,172,383 | ||||||
553,664 | Vodafone Group PLC ADR | 21,017,085 | ||||||
111,740 | WPP PLC ADR | 12,060,098 | ||||||
|
| |||||||
191,528,998 | ||||||||
|
| |||||||
United States—28.6% | ||||||||
145,401 | Accenture PLC, Class A | 11,664,068 | ||||||
129,705 | ACE Ltd. | 13,271,416 | ||||||
109,468 | Allied World Assurance Co. Holdings AG | 11,788,609 | ||||||
306,283 | Axis Capital Holdings Ltd. | 14,012,447 | ||||||
734,619 | Brookfield Infrastructure Partners LP | 28,642,795 | ||||||
107,175 | Bunge Ltd. | 8,536,489 | ||||||
23,967 | Core Laboratories NV | 4,498,127 | ||||||
130,086 | Covidien PLC | 9,268,627 | ||||||
101,355 | Imperial Oil Ltd. | 4,946,124 | ||||||
301,158 | Lazard Ltd., Class A | 14,169,484 | ||||||
1,749,270 | Maiden Holdings Ltd. | 20,641,386 | ||||||
2,615,562 | Navios Maritime Partners LP(a) | 49,512,589 | ||||||
153,786 | PartnerRe Ltd. | 16,209,044 | ||||||
87,125 | Pentair Ltd. | 6,472,516 | ||||||
8,032 | Perrigo Co. PLC | 1,163,516 | ||||||
71,278 | RenaissanceRe Holdings Ltd. | 7,214,046 | ||||||
908,330 | Teekay LNG Partners LP(a) | 38,885,607 | ||||||
1,143,698 | Teekay Offshore Partners LP(a) | 39,125,909 | ||||||
816,217 | Textainer Group Holdings Ltd.(a) | 32,077,329 | ||||||
|
| |||||||
332,100,128 | ||||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $1,029,867,473)—100.0% | 1,160,510,529 | |||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 28 |
|
PowerShares International Dividend Achievers™ Portfolio (PID) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market—14.6% | ||||||||
169,899,166 | Invesco Liquid Assets Portfolio—Institutional Class(b)(c) (Cost $169,899,166) | $ | 169,899,166 | |||||
|
| |||||||
Total Investments (Cost $1,199,766,639)—114.6% | 1,330,409,695 | |||||||
Other assets less liabilities—(14.6)% | (169,756,188 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 1,160,653,507 | ||||||
|
|
Investment Abbreviations:
ADR—American Depositary Receipt
GDR—Global Depositary Receipt
Notes to Schedule of Investments:
(a) | All or portion of this security was out on loan at April 30, 2014. |
(b) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(c) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman | $ | 166,411,271 | $ | (166,411,271 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 29 |
|
Statements of Assets and Liabilities
April 30, 2014
PowerShares BuyBack Achievers™ Portfolio (PKW) | PowerShares Dividend Achievers™ Portfolio (PFM) | PowerShares Financial Preferred Portfolio (PGF) | PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) | PowerShares International Dividend Achievers™ Portfolio (PID) | ||||||||||||||||
Assets: | ||||||||||||||||||||
Unaffiliated investments, at value(a) | $ | 2,905,113,917 | $ | 351,529,970 | $ | 1,439,571,565 | $ | 392,854,427 | $ | 1,160,510,529 | ||||||||||
Affiliated investments, at value | 35,530,392 | 6,276 | 8,506,770 | 13,076,338 | 169,899,166 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total investments, at value | 2,940,644,309 | 351,536,246 | 1,448,078,335 | 405,930,765 | 1,330,409,695 | |||||||||||||||
Cash segregated as collateral | — | — | — | — | 2,915,369 | |||||||||||||||
Receivables: | ||||||||||||||||||||
Investments sold | 44,580,773 | 247,359 | 2,818,787 | — | 1,234,707 | |||||||||||||||
Dividends | 2,723,558 | 515,651 | 3,076,972 | 802,189 | 2,328,461 | |||||||||||||||
Security lending | 62,442 | — | 31,194 | — | 164,703 | |||||||||||||||
Foreign tax reclaims | — | — | — | — | 496,615 | |||||||||||||||
Shares sold | — | — | — | — | 7,415,436 | |||||||||||||||
Other assets | 8,333 | 2,935 | 6,270 | 4,603 | 7,102 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Assets | 2,988,019,415 | 352,302,191 | 1,454,011,558 | 406,737,557 | 1,344,972,088 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Liabilities: | ||||||||||||||||||||
Due to custodian | — | — | 8,576,521 | 1,167,350 | 2,832,481 | |||||||||||||||
Payables: | ||||||||||||||||||||
Investments purchased | 45,071,038 | 257,992 | — | — | 7,415,298 | |||||||||||||||
Collateral upon return of securities loaned | 34,555,549 | — | 8,506,770 | 11,939,200 | 169,899,166 | |||||||||||||||
Collateral upon receipt of securities in-kind | — | — | — | — | 2,915,369 | |||||||||||||||
Accrued advisory fees | 1,184,825 | 113,880 | 585,119 | 126,121 | 370,826 | |||||||||||||||
Accrued trustees’ and officer’s fees | 33,469 | 19,989 | 74,987 | 22,147 | 42,698 | |||||||||||||||
Accrued expenses | 2,053,995 | 353,369 | 709,886 | 379,632 | 842,743 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Liabilities | 82,898,876 | 745,230 | 18,453,283 | 13,634,450 | 184,318,581 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Assets | $ | 2,905,120,539 | $ | 351,556,961 | $ | 1,435,558,275 | $ | 393,103,107 | $ | 1,160,653,507 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Assets Consist of: | ||||||||||||||||||||
Shares of beneficial interest | $ | 2,723,569,850 | $ | 298,894,132 | $ | 1,386,586,442 | $ | 482,182,832 | $ | 1,299,298,612 | ||||||||||
Undistributed net investment income (loss) | 6,767,023 | 797,016 | (70,006 | ) | 316,686 | 2,479,352 | ||||||||||||||
Undistributed net realized gain (loss) | (51,017,774 | ) | (22,737,256 | ) | (39,497,048 | ) | (131,685,763 | ) | (271,767,513 | ) | ||||||||||
Net unrealized appreciation | 225,801,440 | 74,603,069 | 88,538,887 | 42,289,352 | 130,643,056 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Assets | $ | 2,905,120,539 | $ | 351,556,961 | $ | 1,435,558,275 | $ | 393,103,107 | $ | 1,160,653,507 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 66,900,000 | 17,150,000 | 79,800,000 | 31,900,000 | 62,550,000 | |||||||||||||||
Net asset value | $ | 43.42 | $ | 20.50 | $ | 17.99 | $ | 12.32 | $ | 18.56 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Market price | $ | 43.42 | $ | 20.50 | $ | 17.98 | $ | 12.32 | $ | 18.58 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Unaffiliated investments, at cost | $ | 2,679,312,477 | $ | 276,926,901 | $ | 1,351,032,678 | $ | 350,565,075 | $ | 1,029,867,473 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Affiliated investments, at cost | $ | 35,530,392 | $ | 6,276 | $ | 8,506,770 | $ | 13,076,338 | $ | 169,899,166 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total investments, at cost | $ | 2,714,842,869 | $ | 276,933,177 | $ | 1,359,539,448 | $ | 363,641,413 | $ | 1,199,766,639 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
(a) Includes securities on loan with an aggregate value of | $ | 34,016,807 | $ | — | $ | 8,326,823 | $ | 11,773,515 | $ | 166,411,271 | ||||||||||
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 30 |
|
For the year ended April 30, 2014
PowerShares BuyBack Achievers™ Portfolio (PKW) | PowerShares Dividend Achievers™ Portfolio (PFM) | PowerShares Financial Preferred Portfolio (PGF) | PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) | PowerShares International Dividend Achievers™ Portfolio (PID) | ||||||||||||||||
Investment Income: | ||||||||||||||||||||
Unaffiliated dividend income | $ | 29,086,907 | $ | 8,491,301 | $ | 106,454,299 | $ | 14,770,479 | $ | 44,659,195 | ||||||||||
Securities lending income | 228,380 | — | 31,851 | 28,416 | 1,583,431 | |||||||||||||||
Affiliated dividend income | 115 | 33 | 387 | 66 | 96 | |||||||||||||||
Foreign withholding tax | — | — | — | — | (2,279,937 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Income | 29,315,402 | 8,491,334 | 106,486,537 | 14,798,961 | 43,962,785 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Expenses: | ||||||||||||||||||||
Advisory fees | 9,134,698 | 1,307,623 | 7,706,506 | 1,394,050 | 4,032,554 | |||||||||||||||
Sub-licensing | 1,826,939 | 326,905 | 1,491,897 | 348,512 | 1,008,138 | |||||||||||||||
Accounting & administration fees | 362,094 | 64,502 | 302,875 | 68,543 | 198,852 | |||||||||||||||
Recapture (Note 3) | 169,825 | 8,351 | — | — | — | |||||||||||||||
Trustees’ and officer’s fees | 47,919 | 17,572 | 53,518 | 17,986 | 35,355 | |||||||||||||||
Custodian & transfer agent fees | 28,963 | 6,184 | 24,261 | 3,388 | 48,738 | |||||||||||||||
Other expenses | 440,209 | 70,806 | 182,424 | 83,097 | 162,121 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Expenses | 12,010,647 | 1,801,943 | 9,761,481 | 1,915,576 | 5,485,758 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Waivers | (847 | ) | (232 | ) | (2,567 | ) | (379 | ) | (772 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Expenses | 12,009,800 | 1,801,711 | 9,758,914 | 1,915,197 | 5,484,986 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Investment Income | 17,305,602 | 6,689,623 | 96,727,623 | 12,883,764 | 38,477,799 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Realized and Unrealized Gain (Loss): | ||||||||||||||||||||
Net realized gain (loss) from: | ||||||||||||||||||||
Investment securities | (32,230,056 | ) | (1,042,774 | ) | 11,898,861 | 13,516,633 | (1,407,841 | ) | ||||||||||||
In-kind redemptions | 159,016,122 | 21,624,452 | 57,754,929 | 28,449,712 | 52,725,626 | |||||||||||||||
Foreign currencies | — | — | — | — | (194 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net realized gain | 126,786,066 | 20,581,678 | 69,653,790 | 41,966,345 | 51,317,591 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net change in unrealized appreciation (depreciation) | ||||||||||||||||||||
on investment securities | 186,899,277 | 16,307,260 | (149,768,967 | ) | 5,744,238 | 25,895,334 | ||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net realized and unrealized gain (loss) | 313,685,343 | 36,888,938 | (80,115,177 | ) | 47,710,583 | 77,212,925 | ||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net increase in net assets resulting from operations | $ | 330,990,945 | $ | 43,578,561 | $ | 16,612,446 | $ | 60,594,347 | $ | 115,690,724 | ||||||||||
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 31 |
|
Statements of Changes in Net Assets
For the years ended April 30, 2014 and April 30, 2013
PowerShares BuyBack Achievers™ Portfolio (PKW) | PowerShares Dividend Achievers™ Portfolio (PFM) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 17,305,602 | $ | 2,572,438 | $ | 6,689,623 | $ | 6,093,821 | ||||||||
Net realized gain | 126,786,066 | 13,560,070 | 20,581,678 | 12,133,553 | ||||||||||||
Net change in unrealized appreciation (depreciation) | 186,899,277 | 30,026,839 | 16,307,260 | 26,678,396 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | 330,990,945 | 46,159,347 | 43,578,561 | 44,905,770 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (10,911,610 | ) | (2,319,935 | ) | (6,755,875 | ) | (6,171,759 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 3,285,171,345 | 319,435,178 | 79,961,620 | 64,933,146 | ||||||||||||
Value of shares repurchased | (1,118,751,473 | ) | (84,294,640 | ) | (62,155,717 | ) | (59,726,392 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | 2,166,419,872 | 235,140,538 | 17,805,903 | 5,206,754 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | 2,486,499,207 | 278,979,950 | 54,628,589 | 43,940,765 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 418,621,332 | 139,641,382 | 296,928,372 | 252,987,607 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
End of year | $ | 2,905,120,539 | $ | 418,621,332 | $ | 351,556,961 | $ | 296,928,372 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Undistributed net investment income (loss) at end of year | $ | 6,767,023 | $ | 382,251 | $ | 797,016 | $ | 810,124 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 82,050,000 | 10,050,000 | 4,100,000 | 3,850,000 | ||||||||||||
Shares repurchased | (27,250,000 | ) | (2,700,000 | ) | (3,150,000 | ) | (3,650,000 | ) | ||||||||
Shares outstanding, beginning of year | 12,100,000 | 4,750,000 | 16,200,000 | 16,000,000 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding, end of year | 66,900,000 | 12,100,000 | 17,150,000 | 16,200,000 | ||||||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 32 |
|
PowerShares Financial Preferred Portfolio (PGF) | PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) | PowerShares International Dividend Achievers™ Portfolio (PID) | ||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||
$ | 96,727,623 | $ | 111,756,026 | $ | 12,883,764 | $ | 12,623,486 | $ | 38,477,799 | $ | 18,558,027 | |||||||||||
69,653,790 | 35,624,306 | 41,966,345 | 12,693,611 | 51,317,591 | 10,566,822 | |||||||||||||||||
(149,768,967 | ) | 43,703,045 | 5,744,238 | 29,287,799 | 25,895,334 | 81,786,224 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
16,612,446 | 191,083,377 | 60,594,347 | 54,604,896 | 115,690,724 | 110,911,073 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(96,939,622 | ) | (109,257,015 | ) | (12,646,964 | ) | (12,584,468 | ) | (39,823,589 | ) | (18,882,785 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
84,078,357 | 316,357,552 | 143,056,402 | 108,648,485 | 406,219,189 | 213,885,031 | |||||||||||||||||
(459,644,875 | ) | (119,429,930 | ) | (120,376,506 | ) | (104,362,404 | ) | (198,773,646 | ) | (118,768,746 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(375,566,518 | ) | 196,927,622 | 22,679,896 | 4,286,081 | 207,445,543 | 95,116,285 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(455,893,694 | ) | 278,753,984 | 70,627,279 | 46,306,509 | 283,312,678 | 187,144,573 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
1,891,451,969 | 1,612,697,985 | 322,475,828 | 276,169,319 | 877,340,829 | 690,196,256 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 1,435,558,275 | $ | 1,891,451,969 | $ | 393,103,107 | $ | 322,475,828 | $ | 1,160,653,507 | $ | 877,340,829 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | (70,006 | ) | $ | 4,016,083 | $ | 316,686 | $ | 79,886 | $ | 2,479,352 | $ | 3,008,040 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
4,800,000 | 17,250,000 | 12,250,000 | 11,250,000 | 22,950,000 | 13,250,000 | |||||||||||||||||
(26,300,000 | ) | (6,600,000 | ) | (10,300,000 | ) | (10,800,000 | ) | (11,200,000 | ) | (7,400,000 | ) | |||||||||||
101,300,000 | 90,650,000 | 29,950,000 | 29,500,000 | 50,800,000 | 44,950,000 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
79,800,000 | 101,300,000 | 31,900,000 | 29,950,000 | 62,550,000 | 50,800,000 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| 33 |
|
PowerShares BuyBack Achievers™ Portfolio (PKW)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 34.60 | $ | 29.40 | $ | 27.27 | $ | 22.36 | $ | 16.15 | ||||||||||
Net investment income(a) | 0.39 | 0.37 | 0.27 | 0.11 | 0.19 | |||||||||||||||
Net realized and unrealized gain on investments | 8.70 | 5.18 | 2.12 | 4.87 | 6.29 | |||||||||||||||
Total from investment operations | 9.09 | 5.55 | 2.39 | 4.98 | 6.48 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.27 | ) | (0.35 | ) | (0.26 | ) | (0.07 | ) | (0.27 | ) | ||||||||||
Net asset value at end of year | $ | 43.42 | $ | 34.60 | $ | 29.40 | $ | 27.27 | $ | 22.36 | ||||||||||
Market price at end of year(b) | $ | 43.42 | $ | 34.61 | $ | 29.40 | $ | 27.27 | $ | 22.37 | ||||||||||
Net Asset Value Total Return(c) | 26.36 | % | 19.08 | % | 8.91 | % | 22.34 | % | 40.46 | % | ||||||||||
Market Price Total Return(c) | 26.32 | % | 19.11 | % | 8.91 | % | 22.29 | % | 40.43 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 2,905,121 | $ | 418,621 | $ | 139,641 | $ | 43,637 | $ | 38,019 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.66 | %(d) | 0.70 | % | 0.71 | % | 0.70 | % | 0.70 | % | ||||||||||
Expenses, prior to Waivers | 0.66 | %(d) | 0.70 | % | 0.79 | % | 1.00 | % | 0.97 | % | ||||||||||
Net investment income, after Waivers | 0.95 | % | 1.21 | % | 1.00 | % | 0.49 | % | 0.98 | % | ||||||||||
Portfolio turnover rate(e) | 92 | % | 80 | % | 32 | % | 26 | % | 23 | % |
PowerShares Dividend Achievers™ Portfolio (PFM)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 18.33 | $ | 15.81 | $ | 15.29 | $ | 13.21 | $ | 10.30 | ||||||||||
Net investment income(a) | 0.39 | 0.38 | 0.34 | 0.31 | 0.27 | |||||||||||||||
Net realized and unrealized gain on investments | 2.16 | 2.52 | 0.51 | 2.08 | 2.96 | |||||||||||||||
Total from investment operations | 2.55 | 2.90 | 0.85 | 2.39 | 3.23 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.38 | ) | (0.38 | ) | (0.33 | ) | (0.31 | ) | (0.32 | ) | ||||||||||
Net asset value at end of year | $ | 20.50 | $ | 18.33 | $ | 15.81 | $ | 15.29 | $ | 13.21 | ||||||||||
Market price at end of year(b) | $ | 20.50 | $ | 18.32 | $ | 15.80 | $ | 15.29 | $ | 13.21 | ||||||||||
Net Asset Value Total Return(c) | 14.11 | % | 18.67 | % | 5.78 | % | 18.39 | % | 31.76 | % | ||||||||||
Market Price Total Return(c) | 14.17 | % | 18.68 | % | 5.71 | % | 18.39 | % | 31.76 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 351,557 | $ | 296,928 | $ | 252,988 | $ | 217,859 | $ | 133,380 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.55 | % | 0.58 | % | 0.60 | % | 0.60 | % | 0.60 | % | ||||||||||
Expenses, prior to Waivers | 0.55 | % | 0.58 | % | 0.60 | % | 0.61 | % | 0.64 | % | ||||||||||
Net investment income, after Waivers | 2.05 | % | 2.28 | % | 2.28 | % | 2.30 | % | 2.28 | % | ||||||||||
Portfolio turnover rate(e) | 21 | % | 18 | % | 20 | % | 11 | % | 18 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the investment companies in which the Fund invests. Estimated investment company expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the investment companies and are deducted from the value of the funds that the Fund invests in. The effect of the estimated investment company expenses that you bear indirectly is included in the Fund’s total return. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 34 |
|
Financial Highlights (continued)
PowerShares Financial Preferred Portfolio (PGF)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 18.67 | $ | 17.79 | $ | 18.26 | $ | 16.97 | $ | 11.41 | ||||||||||
Net investment income(a) | 1.10 | 1.18 | 1.17 | 1.18 | 1.31 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.68 | ) | 0.85 | (0.42 | ) | 1.36 | 5.61 | |||||||||||||
Total from investment operations | 0.42 | 2.03 | 0.75 | 2.54 | 6.92 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (1.10 | ) | (1.15 | ) | (1.17 | ) | (1.21 | ) | (1.30 | ) | ||||||||||
Return of capital | — | — | (0.05 | ) | (0.04 | ) | (0.06 | ) | ||||||||||||
Total distributions | (1.10 | ) | (1.15 | ) | (1.22 | ) | (1.25 | ) | (1.36 | ) | ||||||||||
Net asset value at end of year | $ | 17.99 | $ | 18.67 | $ | 17.79 | $ | 18.26 | $ | 16.97 | ||||||||||
Market price at end of year(b) | $ | 17.98 | $ | 18.70 | $ | 17.83 | $ | 18.28 | $ | 16.93 | ||||||||||
Net Asset Value Total Return(c) | 2.63 | % | 11.78 | % | 4.56 | % | 15.57 | % | 62.16 | % | ||||||||||
Market Price Total Return(c) | 2.41 | % | 11.71 | % | 4.68 | % | 15.97 | % | 61.76 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 1,435,558 | $ | 1,891,452 | $ | 1,612,698 | $ | 1,832,516 | $ | 1,714,824 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.64 | % | 0.66 | % | 0.66 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.63 | % | 0.64 | % | 0.66 | % | 0.66 | % | 0.65 | % | ||||||||||
Net investment income, after Waivers | 6.28 | % | 6.47 | % | 6.76 | % | 6.75 | % | 8.30 | % | ||||||||||
Portfolio turnover rate(d) | 30 | % | 18 | % | 6 | % | 26 | % | 23 | % |
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 10.77 | $ | 9.36 | $ | 9.06 | $ | 8.44 | $ | 6.12 | ||||||||||
Net investment income(a) | 0.42 | 0.42 | 0.35 | 0.34 | 0.32 | |||||||||||||||
Net realized and unrealized gain on investments | 1.54 | 1.41 | 0.29 | 0.63 | 2.35 | |||||||||||||||
Total from investment operations | 1.96 | 1.83 | 0.64 | 0.97 | 2.67 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.41 | ) | (0.42 | ) | (0.34 | ) | (0.34 | ) | (0.33 | ) | ||||||||||
Return of capital | — | — | — | (0.01 | ) | (0.02 | ) | |||||||||||||
Total distributions | (0.41 | ) | (0.42 | ) | (0.34 | ) | (0.35 | ) | (0.35 | ) | ||||||||||
Net asset value at end of year | $ | 12.32 | $ | 10.77 | $ | 9.36 | $ | 9.06 | $ | 8.44 | ||||||||||
Market price at end of year(b) | $ | 12.32 | $ | 10.76 | $ | 9.36 | $ | 9.06 | $ | 8.44 | ||||||||||
Net Asset Value Total Return(c) | 18.61 | % | 20.16 | % | 7.37 | % | 11.91 | % | 44.59 | % | ||||||||||
Market Price Total Return(c) | 18.72 | % | 20.05 | % | 7.37 | % | 11.91 | % | 44.58 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 393,103 | $ | 322,476 | $ | 276,169 | $ | 208,471 | $ | 127,424 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.55 | % | 0.57 | % | 0.60 | % | 0.60 | % | 0.60 | % | ||||||||||
Expenses, prior to Waivers | 0.55 | % | 0.57 | % | 0.60 | % | 0.62 | % | 0.65 | % | ||||||||||
Net investment income, after Waivers | 3.70 | % | 4.31 | % | 3.88 | % | 4.02 | % | 4.42 | % | ||||||||||
Portfolio turnover rate(d) | 51 | % | 32 | % | 35 | % | 44 | % | 57 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 35 |
|
Financial Highlights (continued)
PowerShares International Dividend Achievers™ Portfolio (PID)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 17.27 | $ | 15.35 | $ | 16.85 | $ | 14.26 | $ | 10.14 | ||||||||||
Net investment income(a) | 0.67 | (b) | 0.40 | 0.48 | 0.47 | 0.35 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 1.26 | 1.93 | (1.49 | ) | 2.59 | 4.24 | ||||||||||||||
Total from investment operations | 1.93 | 2.33 | (1.01 | ) | 3.06 | 4.59 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.64 | ) | (0.41 | ) | (0.49 | ) | (0.47 | ) | (0.47 | ) | ||||||||||
Net asset value at end of year | $ | 18.56 | $ | 17.27 | $ | 15.35 | $ | 16.85 | $ | 14.26 | ||||||||||
Market price at end of year(c) | $ | 18.58 | $ | 17.31 | $ | 15.37 | $ | 16.89 | $ | 14.26 | ||||||||||
Net Asset Value Total Return(d) | 11.50 | % | 15.63 | % | (5.87 | )% | 21.95 | % | 45.77 | % | ||||||||||
Market Price Total Return(d) | 11.35 | % | 15.75 | % | (5.97 | )% | 22.23 | % | 45.62 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 1,160,654 | $ | 877,341 | $ | 690,196 | $ | 550,282 | $ | 427,783 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.54 | % | 0.56 | % | 0.55 | % | 0.58 | % | 0.57 | % | ||||||||||
Expenses, prior to Waivers | 0.54 | % | 0.56 | % | 0.56 | % | 0.58 | % | 0.57 | % | ||||||||||
Net investment income, after Waivers | 3.82 | % | 2.57 | % | 3.20 | % | 3.20 | % | 2.65 | % | ||||||||||
Portfolio turnover rate(e) | 49 | % | 46 | % | 33 | % | 42 | % | 63 | % |
(a) | Based on average shares outstanding. |
(b) | Net investment income per share and the ratio of net investment income to average net assets include a significant dividend during the year. Net investment income per share and the ratio of net investment income to average net assets excluding the significant dividend are $0.43 and 2.42%, respectively. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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PowerShares Exchange-Traded Fund Trust
April 30, 2014
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the “Trust”) was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). As of April 30, 2014, the Trust offered fifty-three portfolios. This report includes the following portfolios:
Full Name | Short Name | |
PowerShares BuyBack Achievers™ Portfolio (PKW) | “BuyBack Achievers™ Portfolio” | |
PowerShares Dividend Achievers™ Portfolio (PFM) | “Dividend Achievers™ Portfolio” | |
PowerShares Financial Preferred Portfolio (PGF) | “Financial Preferred Portfolio” | |
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) | “High Yield Equity Dividend Achievers™ Portfolio” | |
PowerShares International Dividend Achievers™ Portfolio (PID) | “International Dividend Achievers™ Portfolio” |
Each portfolio (each, a “Fund,” and collectively, the “Funds”) represents a separate series of the Trust. The shares of the Funds are referred to herein as “Shares” or “Fund’s Shares.” Each Fund’s Shares are listed and traded on NYSE Arca, Inc.
The market prices of each Fund’s Shares may differ to some degree from the Fund’s net asset value (“NAV”). Unlike conventional mutual funds, each Fund issues and redeems Shares on a continuous basis, at NAV, only in a large specified number of Shares, each called a “Creation Unit.” Creation Units are issued and redeemed in exchange for the deposit or delivery of a basket of securities (“Deposit Securities”). Except when aggregated in Creation Units by Authorized Participants, the Shares are not individually redeemable securities of the Funds.
The investment objective of each Fund is to seek investment results that generally correspond (before fees and expenses) to the price and yield of its respective index listed below (each, an “Underlying Index”):
Fund | Underlying Index | |
BuyBack Achievers™ Portfolio | NASDAQ US BuyBack Achievers™ Index | |
Dividend Achievers™ Portfolio | NASDAQ US Broad Dividend Achievers™ Index | |
Financial Preferred Portfolio | Wells Fargo® Hybrid & Preferred Securities Financial Index | |
High Yield Equity Dividend Achievers™ Portfolio | NASDAQ US Dividend Achievers™ 50 Index | |
International Dividend Achievers™ Portfolio | NASDAQ International Dividend Achievers™ Index |
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates. In addition, the Funds monitor for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policies.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and ask prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and ask prices. For purposes of determining NAV per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end of day NAV per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
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Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Securities with a demand feature exercisable within one to seven days are valued at par. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that Invesco PowerShares Capital Management LLC (the “Adviser”) determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith following procedures approved by the Board of Trustees. Issuer-specific events, market trends, bid/ask quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
Each Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain of each Fund’s investments.
Valuations change in response to many factors, including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. Other Risks
Index Risk. Unlike many investment companies, the Funds do not utilize investing strategies that seek returns in excess of their Underlying Indexes. Therefore, a Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its respective Underlying Index, even if that security generally is underperforming.
Equity Risk. Equity risk is the risk that the value of the securities that each Fund holds will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities that a Fund holds participate or factors relating to specific companies in which the Funds invest. For example, an adverse event, such as an unfavorable earnings report, may depress the value of securities a Fund holds; the price of securities may be particularly sensitive to general movements in the stock market; or a drop in the stock market may depress the price of most or all of the securities a Fund holds. In addition, securities of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition.
Industry Concentration Risk. In following its methodology, each Fund’s Underlying Index from time to time may be concentrated to a significant degree in securities of issuers located in a single industry or a sector. To the extent that an Underlying Index concentrates in the securities of issuers in a particular industry or sector, each Fund will also concentrate its investments to approximately the same extent. By concentrating its investments in an industry or sector, a Fund may face more risks than if it were diversified broadly over
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numerous industries or sectors. In addition, at times, an industry or sector may be out of favor and underperform other industries or the market as a whole. Any factors detrimental to the performance of such industry or sector will disproportionately impact a Fund’s NAV.
Non-Diversified Fund Risk. BuyBack Achievers™ Portfolio and Financial Preferred Portfolio are non-diversified and can invest a greater portion of their assets in securities of individual issuers than diversified funds. As a result, changes in the market value of a single investment could cause greater fluctuations in Share price than would occur in a diversified fund. This may increase a Fund’s volatility and cause the performance of a relatively small number of issuers to have a greater impact on a Fund’s performance.
Non-Correlation Risk. Each Fund’s return may not match the return of its Underlying Index for a number of reasons. For example, each Fund incurs operating expenses not applicable to its Underlying Index, and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of its Underlying Index. In addition, the performance of each Fund and its Underlying Index may vary due to asset valuation differences and differences between each Fund’s portfolio and its Underlying Index resulting from legal restrictions, cost or liquidity constraints.
Sampling Risk. Financial Preferred Portfolio’s use of a representative sampling approach will result in the Fund holding a smaller number of securities than are in its Underlying Index. As a result, an adverse development to an issuer of securities that the Fund holds could result in a greater decline in NAV than would be the case if the Fund held all of the securities in its Underlying Index. To the extent the assets in the Fund are smaller, these risks will be greater.
Small and Medium Capitalization Company Risk. Investing in securities of small and medium capitalization companies involves greater risk than customarily is associated with investing in larger, more established companies. These companies’ securities may be more volatile and less liquid than those of more established companies. These securities may have returns that vary, sometimes significantly, from the overall securities market. Often small and medium capitalization companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.
High Dividend Paying Securities Risk. Dividend Achievers™ Portfolio, High Yield Equity Dividend Achievers™ Portfolio and International Dividend Achievers™ Portfolio invest in securities that pay high dividends. As a group, these securities can fall out of favor with the market, causing such companies to underperform companies that do not pay high dividends. Also, changes in the dividend policies of the companies in an Underlying Index and the capital resources available for such companies’ dividend payments may affect a Fund.
Foreign Securities Risk. For Financial Preferred Portfolio and International Dividend Achievers™ Portfolio, investments in foreign securities involve risks in addition to the risks associated with domestic securities. In general, foreign companies are not subject to the regulatory requirements of U.S. companies and, as such, there may be less publicly available information about these companies. Moreover, foreign companies often are subject to less stringent requirements regarding accounting, auditing, financial reporting and record-keeping than are U.S. companies. Therefore, not all material information regarding these companies will be available.
In addition, securities of foreign issuers may be less liquid than comparable securities of U.S. issuers and, as such, their price changes may be more volatile. Furthermore, foreign exchanges and broker-dealers generally are subject to less government and exchange scrutiny and regulation than their U.S. counterparts. In addition, differences in clearance and settlement procedures in foreign markets may cause delays in settlement of a Fund’s trades effected in those markets and could result in losses to a Fund due to subsequent declines in the value of the securities subject to the trades. Depositary receipts also involve substantially identical risks to those associated with investments in foreign securities. Additionally, the issuers of certain depositary receipts, particularly unsponsored or unregistered depositary receipts, have no obligation to distribute shareholder communications to the holders of such receipts or to pass through to them any voting rights with respect to the deposited securities.
High Yield Securities Risk. For Financial Preferred Portfolio and High Yield Equity Dividend Achievers™ Portfolio, high yield securities typically involve greater risk and are less liquid than higher grade issues. Changes in general economic conditions, changes in the financial condition of the issuers and changes in interest rates may adversely impact the ability of issuers of high yield securities to make timely payments of interest and principal.
Preferred Securities Risk. Financial Preferred Portfolio faces special risks associated with investing in preferred securities. Preferred securities may include provisions that permit the issuer, in its discretion, to defer or omit distributions for a certain period of time. If the Fund owns a security that is deferring or omitting its distributions, the Fund may be required to report the distribution on its tax returns, even though it may not have received this income. Further, preferred securities may lose substantial value due to the omission or deferment of dividend payments. Preferred securities may be less liquid than many other securities, such as common stocks, and generally offer no voting rights with respect to the issuer. Preferred securities also may be subordinated to bonds or other debt instruments in an issuer’s capital structure, subjecting them to a greater risk of non-payment than more senior securities. In addition, in certain circumstances, an issuer of preferred securities may redeem the securities prior to a specified date, and this may negatively impact the return of the security.
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C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and to distribute substantially all of the Fund’s taxable earnings to its shareholders. As such, the Funds will not be subject to federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements.
Each Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed each Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These timing differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and passive foreign investment company adjustments, if any.
The Funds file U.S. federal tax returns and tax returns in certain other jurisdictions. Generally, a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Transactions and Investment Income
Investment transactions are accounted for on a trade date basis. Realized gains and losses from the sale or disposition of securities are computed on the specific identified cost basis. Interest income is recorded on the accrual basis. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. Realized gains, dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date.
E. Expenses
Expenses of the Trust that are directly identifiable to a specific Fund are applied to that Fund. Expenses of the Trust that are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, sub-licensing fees related to its respective Underlying Index, any distribution fees or expenses, litigation expenses, fees payable to the Trust’s Board members who are not “interested persons” (as defined in the 1940 Act) of the Trust (the “Independent Trustees”) or the Adviser, expenses incurred in connection with the Board members’ services, including travel expenses and legal fees of counsel for the Independent Trustees, acquired fund fees and expenses, if any, and extraordinary expenses.
To the extent a Fund invests in other investment companies, the expenses shown in the accompanying financial statements reflect the expenses of the Fund and do not include any expenses of the investment companies in which it invests. The effects of such investment companies’ expenses are included in the realized and unrealized gain or loss on the investments in the investment companies.
F. Dividends and Distributions to Shareholders
Each Fund (except for High Yield Dividend Achievers™ Portfolio and Financial Preferred Portfolio, which declare and pay dividends from net investment income, if any, monthly) declares and pays dividends from net investment income, if any, to its shareholders quarterly and records such dividends on ex-dividend date. Generally, each Fund distributes net realized taxable capital gains, if any, annually in cash and records them on ex-dividend date. Such distributions on a tax basis are determined in conformity with federal income tax regulations, which may differ from GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund’s financial statements as a tax return of capital at fiscal period-end.
G. Securities Lending
BuyBack Achievers™ Portfolio, Financial Preferred Portfolio, High Yield Equity Dividend Achievers™ Portfolio and International Dividend Achievers™ Portfolio may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by cash collateral equal to no less than 102% of the market value of the loaned securities determined daily by the securities lending provider. Cash collateral received in connection with these loans is invested in an affiliated money market fund and is shown as such on the Schedule of Investments. It is the policy of the Fund to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to a Fund if, and to the extent that, the market value of the securities loaned were to increase, and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. Upon the failure of the borrower to return the securities, collateral may be liquidated and
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the securities may be purchased on the open market to replace the loaned securities. A Fund could experience delays and costs in gaining access to the collateral. A Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Securities lending income on the Statements of Operations. The aggregate value of securities out on loan is shown on the Statements of Assets and Liabilities, if any.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser pursuant to which the Adviser has overall responsibility for the selection and ongoing monitoring of the Funds’ investments, managing the Funds’ business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund has agreed to pay the Adviser an annual fee of 0.40% of the Fund’s average daily net assets, except for BuyBack Achievers™ Portfolio and Financial Preferred Portfolio, each of which pay the Adviser an annual fee of 0.50% of the Fund’s average daily net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement (the “Expense Agreement”) with the Trust on behalf of each fund, pursuant to which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses (excluding interest expenses, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes, acquired fund fees and expenses, if any, and extraordinary expenses) of each Fund (except for BuyBack Achievers™ Portfolio and Financial Preferred Portfolio) from exceeding 0.50% of the Fund’s average daily net assets per year (0.60% of the Fund’s average daily net assets per year for the BuyBack Achievers™ Portfolio and Financial Preferred Portfolio) (the “Expense Cap”), through at least August 31, 2015. Offering costs excluded from the Expense Cap are: (a) initial legal fees pertaining to the Funds’ Shares offered for sale; (b) initial Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange. Unless the Adviser continues the Expense Agreement, it will terminate on August 31, 2015. The Expense Agreement cannot be terminated during its term. For each portfolio, the Adviser did not waive fees and/or pay Fund expenses during the period under this Expense Cap.
Further, through August 31, 2015, the Adviser has contractually agreed to waive a portion of the Fund’s management fee in an amount equal to 100% of the net advisory fees an affiliate of the Adviser receives that are attributable to certain of the Fund’s investments in money market funds managed by that affiliate (excluding investments of cash collateral from securities lending). The Adviser cannot discontinue this waiver prior to its expiration.
For the fiscal year ended April 30, 2014, the Adviser waived fees and/or paid Fund expenses for each Fund, in the following amounts:
BuyBack Achievers™ Portfolio | $ | 847 | ||
Dividend Achievers™ Portfolio | 232 | |||
Financial Preferred Portfolio | 2,567 | |||
High Yield Equity Dividend Achievers™ Portfolio | 379 | |||
International Dividend Achievers™ Portfolio | 772 |
The Expense Agreement provides that the fees waived or expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee was waived or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above.
For the fiscal year ended April 30, 2014, there were no amounts available for potential recapture by the Adviser under the Expense Agreement.
The Trust has entered into a Distribution Agreement with Invesco Distributors, Inc. (the “Distributor”), which serves as the distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in the Shares. The Funds are not charged any fees pursuant to the Distribution Agreement. The Distributor is an affiliate of the Adviser.
The Adviser has entered into a licensing agreement for each Fund with the following entities (each, a “Licensor”):
Fund | Licensor | |
BuyBack Achievers™ Portfolio | NASDAQ OMX Group, Inc. | |
Dividend Achievers™ Portfolio | NASDAQ OMX Group, Inc. | |
Financial Preferred Portfolio | Wells Fargo Securities, LLC | |
High Yield Equity Dividend Achievers™ Portfolio | NASDAQ OMX Group, Inc. | |
International Dividend Achievers™ Portfolio | NASDAQ OMX Group, Inc. |
Each Underlying Index name trademark is owned by its respective Licensor. These trademarks have been licensed to the Adviser for use by the Funds. Each Fund is entitled to use its Underlying Index pursuant to the Trust’s sub-licensing agreement with the Adviser. The Funds are required to pay the sub-licensing fees that are shown on the Statements of Operations. The Funds are not sponsored, endorsed, sold or promoted by the Licensors, and the Licensors make no representation regarding the advisability of investing in any of the Funds.
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The Trust has entered into service agreements whereby The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian, fund accountant and transfer agent for each Fund.
Note 4. Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
As of April 30, 2014, all of the securities in each Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Note 5. Distributions to Shareholders and Tax Components of Net Assets
Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended April 30, 2014 and 2013:
2014 | 2013 | |||||||
Ordinary Income | Ordinary Income | |||||||
BuyBack Achievers™ Portfolio | $ | 10,911,610 | $ | 2,319,935 | ||||
Dividend Achievers™ Portfolio | 6,755,875 | 6,171,759 | ||||||
Financial Preferred Portfolio | 96,939,622 | 108,100,715 | ||||||
High Yield Equity Dividend Achievers™ Portfolio | 12,646,964 | 12,584,468 | ||||||
International Dividend Achievers™ Portfolio | 39,823,589 | 18,882,785 |
Tax Components of Net Assets at Fiscal Year-End:
Undistributed Ordinary Income | Temporary Book/Tax Differences | Net Unrealized Appreciation— Investment Securities | Capital Loss Carryforward | Post-October Capital Loss Deferrals* | Shares of Beneficial Interest | Total Net Assets | ||||||||||||||||||||||
BuyBack Achievers™ Portfolio | $ | 6,790,645 | $ | (23,622 | ) | $ | 212,932,340 | $ | (17,966,329 | ) | $ | (20,182,345 | ) | $ | 2,723,569,850 | $ | 2,905,120,539 | |||||||||||
Dividend Achievers™ Portfolio | 814,874 | (17,858 | ) | 71,967,508 | (19,568,323 | ) | (533,372 | ) | 298,894,132 | 351,556,961 | ||||||||||||||||||
Financial Preferred Portfolio | — | (70,006 | ) | 78,236,812 | (26,697,729 | ) | (2,497,244 | ) | 1,386,586,442 | 1,435,558,275 | ||||||||||||||||||
High Yield Equity Dividend Achievers™ Portfolio | 336,627 | (19,941 | ) | 40,030,425 | (129,426,836 | ) | — | 482,182,832 | 393,103,107 | |||||||||||||||||||
International Dividend Achievers™ Portfolio | 2,517,747 | (38,395 | ) | 115,131,535 | (256,255,992 | ) | — | 1,299,298,612 | 1,160,653,507 |
* | The Funds will elect to defer net capital losses incurred after October 31 (“Post-October Capital Losses”) within the taxable year that are deemed to arise on the first business day of each Fund’s next taxable year. |
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Funds to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in 8 tax years. Capital losses
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with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The following Funds have capital loss carryforwards as of April 30, 2014, which expire as follows:
Post-effective no expiration | Utilized | Expired | ||||||||||||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Short-term | Long-term | Total* | |||||||||||||||||||||||||||||||||
BuyBack Achievers™ Portfolio | $ | — | $ | 2,915,681 | $ | 800,254 | $ | 12,142,749 | $ | 2,107,645 | $ | — | $ | — | $ | 17,966,329 | $ | 5,112,463 | $ | — | ||||||||||||||||||||
Dividend Achievers™ Portfolio | — | 50,943 | 1,716,151 | 14,632,363 | 2,339,194 | 271,124 | 558,548 | 19,568,323 | 76,569 | 7,896 | ||||||||||||||||||||||||||||||
Financial Preferred Portfolio | — | 10,308,236 | 9,034,558 | 7,354,935 | — | — | — | 26,697,729 | 11,880,150 | — | ||||||||||||||||||||||||||||||
High Yield Equity Dividend Achievers™ Portfolio | — | 936,776 | 81,487,358 | 44,815,128 | 2,187,574 | — | — | 129,426,836 | 12,848,630 | — | ||||||||||||||||||||||||||||||
International Dividend Achievers™ Portfolio | 148,582 | 1,975,339 | 59,472,841 | 145,514,837 | 11,745,409 | 28,743,478 | 8,655,506 | 256,255,992 | — | — |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
Note 6. Investment Transactions
For the fiscal year ended April 30, 2014, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, U.S. Treasury obligations, money market funds and in-kind transactions, were as follows:
Purchases | Sales | |||||||
BuyBack Achievers™ Portfolio | $ | 1,696,162,813 | $ | 1,686,096,225 | ||||
Dividend Achievers™ Portfolio | 75,668,678 | 69,360,848 | ||||||
Financial Preferred Portfolio | 465,991,239 | 539,420,172 | ||||||
High Yield Equity Dividend Achievers™ Portfolio | 177,663,032 | 177,042,725 | ||||||
International Dividend Achievers™ Portfolio | 506,011,488 | 499,535,086 |
For the fiscal year ended April 30, 2014, in-kind transactions associated with creations and redemptions were as follows:
Cost of Securities Received | Value of Securities Delivered | |||||||
BuyBack Achievers™ Portfolio | $ | 3,281,285,886 | $ | 1,118,333,933 | ||||
Dividend Achievers™ Portfolio | 73,920,797 | 61,982,671 | ||||||
Financial Preferred Portfolio | 68,292,230 | 404,673,008 | ||||||
High Yield Equity Dividend Achievers™ Portfolio | 143,022,400 | 120,472,304 | ||||||
International Dividend Achievers™ Portfolio | 404,437,933 | 200,219,031 |
Gains (losses) on in-kind transactions are generally not considered taxable gains (losses) for federal income tax purposes.
At April 30, 2014, the aggregate cost and the net unrealized appreciation of investments for tax purposes were as follows:
Cost | Net Unrealized Appreciation | Gross Unrealized Appreciation | Gross Unrealized (Depreciation) | |||||||||||||
BuyBack Achievers™ Portfolio | $ | 2,727,711,969 | $ | 212,932,340 | $ | 244,071,272 | $ | (31,138,932 | ) | |||||||
Dividend Achievers™ Portfolio | 279,568,738 | 71,967,508 | 72,507,128 | (539,620 | ) | |||||||||||
Financial Preferred Portfolio | 1,369,841,523 | 78,236,812 | 107,682,813 | (29,446,001 | ) | |||||||||||
High Yield Equity Dividend Achievers™ Portfolio | 365,900,340 | 40,030,425 | 41,581,345 | (1,550,920 | ) | |||||||||||
International Dividend Achievers™ Portfolio | 1,215,278,160 | 115,131,535 | 135,506,005 | (20,374,470 | ) |
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Note 7. Reclassification of Permanent Differences
Primarily as a result of differing book/tax treatment of in-kind transactions on April 30, 2014, amounts were reclassified between undistributed net investment income (loss), undistributed net realized gain (loss) and shares of beneficial interest. These reclassifications had no effect on the net assets of each Fund. For the fiscal year ended April 30, 2014, the reclassifications were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Net Realized Gain (Loss) | Shares of Beneficial Interest | ||||||||||
BuyBack Achievers™ Portfolio | $ | (9,220 | ) | $ | (151,691,337 | ) | $ | 151,700,557 | ||||
Dividend Achievers™ Portfolio | 53,144 | (20,864,246 | ) | 20,811,102 | ||||||||
Financial Preferred Portfolio | (3,874,090 | ) | (56,797,927 | ) | 60,672,017 | |||||||
High Yield Equity Dividend Achievers™ Portfolio | — | (27,487,654 | ) | 27,487,654 | ||||||||
International Dividend Achievers™ Portfolio | 817,102 | (51,382,654 | ) | 50,565,552 |
Note 8. Trustees’ and Officer’s Fees
Trustees’ and Officer’s Fees include amounts accrued by the Funds to pay remuneration to the Independent Trustees and Officer of the Funds. The Trustee who is an “interested person” (the “Non-Independent Trustee”) of the Trust does not receive any Trustees’ fees.
The Trust has adopted a deferred compensation plan (the “Plan”). Under the Plan, an Independent Trustee who has executed a Deferred Fee Agreement (a “Participating Trustee”) may defer receipt of all or a portion of his compensation (“Deferral Fees”). Such Deferral Fees are deemed to be invested in select PowerShares Funds. The Deferral Fees payable to the Participating Trustee are valued as of the date such Deferral Fees would have been paid to the Participating Trustee. The value increases with contributions or with increases in the value of the Shares selected, and the value decreases with distributions or with declines in the value of the Shares selected. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Funds.
Note 9. Capital
Shares are created and redeemed by each Fund only in Creation Units of 50,000 Shares. Only Authorized Participants are permitted to purchase or redeem Creation Units from the Funds. Such transactions are generally permitted in exchange for Deposit Securities, with a balancing cash component to equate the transaction to the NAV per Share of a Fund of the Trust on the transaction date. However, for all Funds, cash in an amount equivalent to the value of certain securities may be substituted, generally when the securities are not available in sufficient quantity for delivery, not eligible for trading by the Authorized Participant or as a result of other market circumstances.
To the extent that the Funds permit transactions in exchange for Deposit Securities, each Fund may issue Shares in advance of receipt of Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to 105% of the market value of the missing Deposit Securities. In accordance with each Fund’s Participant Agreement, Creation Units will be issued to an Authorized Participant, notwithstanding the fact that the corresponding Deposit Securities have not been received in part or in whole, in reliance on the undertaking of the Authorized Participant to deliver the missing Deposit Securities as soon as possible, which undertaking shall be secured by the Authorized Participant’s delivery and maintenance of collateral consisting of cash in the form of U.S. dollars in immediately available funds having a value (marked-to-market daily) at least equal to 105%, which the Adviser may change from time to time, of the value of the missing Deposit Securities.
Transactions in each Fund’s Shares are disclosed in detail in the Statements of Changes in Net Assets.
Note 10. Indemnifications
Under the Trust’s organizational documents, its officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Each Independent Trustee is also indemnified against certain liabilities arising out of the performance of his duties to the Trust pursuant to an Indemnification Agreement between the Independent Trustee and the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
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Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of PowerShares Buyback AchieversTM Portfolio, PowerShares Dividend AchieversTM Portfolio, PowerShares Financial Preferred Portfolio, PowerShares High Yield Equity Dividend AchieversTM Portfolio and PowerShares International Dividend AchieversTM Portfolio (each an individual portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the “Funds”) at April 30, 2014, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2014 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Chicago, IL
June 24, 2014
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As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur advisory fees and other Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2014.
In addition to the fees and expenses which the PowerShares BuyBack Achievers™ Portfolio (the “Portfolio”) bears directly, the Portfolio indirectly bears a pro rata share of the fees and expenses of the investment companies in which the Portfolio invests. The amount of fees and expenses incurred indirectly by the Portfolio will vary because the investment companies have varied expenses and fee levels and the Portfolio may own different proportions of the investment companies at different times. Estimated investment companies’ expenses are not expenses that are incurred directly by the Portfolio. They are expenses that are incurred directly by the investment companies and are deducted from the value of the investment companies the Portfolio invests in. The effect of the estimated investment companies’ expenses that you bear indirectly are included in the Portfolio’s total returns.
Actual Expenses
The first line in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following table provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as sales charges and brokerage commissions. Therefore, the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by a Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Number of Days in the Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares BuyBack Achievers™ Portfolio (PKW) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,067.09 | 0.66 | % | $ | 3.38 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.52 | 0.66 | 3.31 | ||||||||||||
PowerShares Dividend Achievers™ Portfolio (PFM) | ||||||||||||||||
Actual | 1,000.00 | 1,068.95 | 0.55 | 2.82 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.07 | 0.55 | 2.76 | ||||||||||||
PowerShares Financial Preferred Portfolio (PGF) | ||||||||||||||||
Actual | 1,000.00 | 1,074.33 | 0.62 | 3.19 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.72 | 0.62 | 3.11 | ||||||||||||
PowerShares High Yield Equity Dividend Achievers™ Portfolio (PEY) | ||||||||||||||||
Actual | 1,000.00 | 1,088.76 | 0.55 | 2.85 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.07 | 0.55 | 2.76 |
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Fees and Expenses (continued)
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Number of Days in the Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares International Dividend Achievers™ Portfolio (PID) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,061.13 | 0.54 | % | $ | 2.76 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,022.12 | 0.54 | 2.71 |
(1) | Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six-month period ended April 30, 2014. Expenses are calculated by multiplying the Fund’s annualized expense ratio by the average account value for the period, then multiplying the result by 181/365. Expense ratios for the most recent half-year may differ from expense ratios based on the annualized data in the Financial Highlights. |
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Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.
The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state’s requirement.
Each Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended April 30, 2014:
Federal Income Tax Information
Qualified Dividend Income* | Dividends-Received Deduction* | |||||||||
BuyBack Achievers™ Portfolio | 100 | % | 100 | % | ||||||
Dividend Achievers™ Portfolio | 100 | % | 100 | % | ||||||
Financial Preferred Portfolio | 100 | % | 54 | % | ||||||
High Yield Equity Dividend Achievers™ Portfolio | 100 | % | 100 | % | ||||||
International Dividend Achievers™ Portfolio | 88 | % | 0 | % |
* | The above percentages are based on ordinary income dividends paid to shareholders during the Fund’s fiscal year. |
The following Fund intends to elect to pass through to shareholders the credit for taxes paid to foreign countries. The gross foreign source income and foreign taxes paid are as follows:
Foreign Source Income | Foreign Taxes | |||||||||
International Dividend Achievers™ Portfolio | $ | 35,332,256 | $ | 1,197,899 |
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The Independent Trustees, the Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by each Trustee are shown below.
The Trustees and officers information is current as of April 30, 2014.
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Ronn R. Bagge (1958) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Founder and Principal, YQA Capital Management LLC (1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider). | 114 | None | |||||
Todd J. Barre (1957) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2010 | Assistant Professor of Business, Trinity Christian College (2010-Present); formerly Vice President and Senior Investment Strategist (2001-2008), Director of Open Architecture and Trading (2007-2008), Head of Fundamental Research (2004-2007) and Vice President and Senior Fixed Income Strategist (1994-2001), BMO Financial Group/Harris Private Bank. | 114 | None | |||||
Marc M. Kole (1960) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2006 | Chief Financial Officer, Hope Network (social services) (2008-2012); formerly, Assistant Vice President and Controller, Priority Health (health insurance) (2005-2008); Senior Vice President of Finance, United Healthcare (2004-2005); Senior Vice President of Finance, Oxford Health Plans (2000-2004). | 114 | None | |||||
Yung Bong Lim (1964) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Managing Partner, Residential Dynamics Group LLC (2008-Present); formerly, Managing Director, Citadel Investment Group, L.L.C. (1999-2007). | 114 | None | |||||
Philip M. Nussbaum (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (2004-Present). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Gary R. Wicker (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Senior Vice President of Global Finance and Chief Financial Officer at RBC Ministries (publishing company) (2013-Present); formerly, Executive Vice President and Chief Financial Officer, Zondervan Publishing (a division of Harper Collins/NewsCorp) (2007-2012); Senior Vice President and Group Controller (2005-2006), Senior Vice President and Chief Financial Officer (2003-2004), Chief Financial Officer (2001-2003), Vice President, Finance and Controller (1999-2001) and Assistant Controller (1997-1999), divisions of The Thomson Corporation (information services provider). | 114 | None | |||||
Donald H. Wilson (1959) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Chairman of the Board and Trustee | Chairman since 2012; Trustee since 2006 | Chairman, President and Chief Executive Officer, Community Financial Shares, Inc. and Community Bank—Wheaton/Glen Ellyn (subsidiary) (2013-Present); Chairman and Chief Executive Officer, Stone Pillar Advisers, Ltd. (2010-Present); formerly, Chief Operating Officer, AMCORE Financial, Inc. (bank holding company) (2007-2009); Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (2006-2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (1995-2006). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
The Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by the Non-Independent Trustee and the other directorships, if any, held by the Non-Independent Trustee are shown below.
Name, Address and Age of Non-Independent Trustee | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Non-Independent Trustee | Other Directorships Held by Non-Independent Trustee During the Past 5 Years | |||||
Kevin M. Carome (1956) Invesco Ltd. Two Peachtree Pointe 1555 Peachtree St., N.E., Suite 1800 Atlanta, GA 30309 | Trustee | Since 2010 | Senior Managing Director, Secretary and General Counsel, Invesco Ltd. (2006-Present); Director, Invesco Advisers, Inc. (2009-Present); Director, Invesco Advisers, Inc., Invesco Finance PLC, INVESCO Funds Group, Inc., and Invesco Holding Company Limited; Director and Executive Vice President, Invesco Finance, Inc., Invesco Group Services, Inc., Invesco Investments (Bermuda) Ltd., Invesco North American Holdings, Inc., and IVZ, Inc.; Director and Secretary, IVZ Bahamas Private Limited; formerly, Senior Vice President, Secretary and General Counsel, Invesco Advisers, Inc. (2003-2005); Senior Vice President and General Counsel, Liberty Financial Companies, Inc. (2000-2001); General Counsel of certain investment management subsidiaries of Liberty Financial Companies, Inc. (1998-2000); Associate General Counsel, Liberty Financial Companies, Inc. (1993-1998); Associate, Ropes & Gray LLP. | 114 | None |
* | This is the date the Non-Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Andrew Schlossberg (1974) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046 | President | Since 2009 | Director, Invesco Distributors, Inc. (2012-Present); Managing Director—U.S. Strategy and Marketing, Invesco PowerShares Capital Management LLC (2010-Present); Managing Director, U.S. head of business strategy and chief marketing officer for Invesco Ltd. in the United States (2008-Present); Director, Invesco Distributors, Inc. (2012-Present); and Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present); formerly, Mr. Schlossberg served in multiple roles within Invesco, including head of corporate development, as well as global leadership roles in strategy and product development in the company’s North American Institutional and Retirement divisions (2002-2007). | |||
Peter Hubbard (1981) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2009 | Vice President and Director of Portfolio Management—Invesco PowerShares Capital Management LLC (2008-Present); formerly, Portfolio Manager, Invesco PowerShares Capital Management LLC (2007-2008); Research Analyst, Invesco PowerShares Capital Management LLC (2005-2007); Research Analyst and Trader, Ritchie Capital, a hedge fund operator (2003-2005). | |||
David Warren (1957) Invesco Canada Ltd. 5140 Yonge Street Suite 900, Toronto, Ontario M2N 6X7 | Vice President | Since 2009 | Managing Director—Chief Administrative Officer, Americas, Invesco PowerShares Capital Management LLC; Senior Vice President, Invesco Advisers, Inc. (2009-Present); Director, Executive Vice President and Chief Financial Officer, Invesco Inc. (2009–Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) and Chief Administrative Officer, North American Retail, Invesco Ltd. (2007-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Invesco Canada Holdings Inc. (2002–Present), Invesco Corporate Class Inc., and Invesco Canada Fund Inc.; Director, Executive Vice President and Chief Financial Officer, Invesco, Inc.; formerly, Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) (2000-2006). | |||
Sheri Morris (1964) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Vice President | Since 2012 | Vice President, Treasurer and Principal Financial Officer, The Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present) and Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; formerly, Treasurer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc. | |||
Rudolf E. Reitmann (1971) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global Exchange Traded Funds Operations, Invesco PowerShares Capital Management LLC (since 2013). |
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Daniel E. Draper (1968) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Senior Vice President, Invesco Distributors, Inc. (since 2014); Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Managing Director, Invesco PowerShares Global ETFs (since 2013); formerly, Managing Director, Credit Suisse Asset Management (2010–2013) and Lyxor Asset Management/Societe Generale (2007–2010). | |||
Steven M. Hill (1964) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President and Treasurer | Since 2013 | Vice President and Treasurer of PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global ETF Administration, Invesco PowerShares Capital Management LLC (since 2011); formerly, Senior Managing Director and Chief Financial Officer, Destra Capital Management LLC and its subsidiaries (2010-2011); Chief Financial Officer, Destra Investment Trust and Destra Investment Trust II (2010-2011); Senior Managing Director, Claymore Securities, Inc. (2003-2010); and Chief Financial Officer, Claymore sponsored mutual funds (2003-2010). | |||
Christopher Joe (1969) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Chief Compliance Officer | Since 2012 | U.S. Compliance Director, Invesco, Ltd. (since 2006); formerly, Chief Compliance Officer, Invesco Investment Advisers, LLC (registered investment adviser) (2010-2013); formerly, Assistant Fund Accounting Manager, Invesco, Ltd. (1998-1999). | |||
Anna Paglia (1974) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Secretary | Since 2011 | Secretary, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (2011-Present); Head of Legal, Invesco PowerShares Capital Management LLC (2010-Present); formerly, Partner, K&L Gates LLP (formerly, Bell Boyd & Lloyd LLP) (2007-2010); Associate Counsel at Barclays Global Investors Ltd. (2004-2006). |
Availability of Additional Information About the Trustees
The Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request at (800) 983-0903.
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for the following 51 series (each, a “Fund” and collectively, the “Funds”):
PowerShares Aerospace & Defense Portfolio
PowerShares BuyBack Achievers™ Portfolio
PowerShares Cleantech™ Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares DWA Momentum Portfolio
PowerShares DWA Basic Materials Momentum Portfolio
PowerShares DWA Consumer Cyclicals Momentum Portfolio
PowerShares DWA Consumer Staples Momentum Portfolio
PowerShares DWA Energy Momentum Portfolio
PowerShares DWA Financial Momentum Portfolio
PowerShares DWA Healthcare Momentum Portfolio
PowerShares DWA Industrials Momentum Portfolio
PowerShares DWA NASDAQ Momentum Portfolio
PowerShares DWA Technology Momentum Portfolio
PowerShares DWA Utilities Momentum Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Building & Construction Portfolio
PowerShares Dynamic Energy Exploration & Production Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Market Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Oil & Gas Services Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Financial Preferred Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares Fundamental Pure Large Core Portfolio
PowerShares Fundamental Pure Large Growth Portfolio
PowerShares Fundamental Pure Large Value Portfolio
PowerShares Fundamental Pure Mid Core Portfolio
PowerShares Fundamental Pure Mid Growth Portfolio
PowerShares Fundamental Pure Mid Value Portfolio
PowerShares Fundamental Pure Small Core Portfolio
PowerShares Fundamental Pure Small Growth Portfolio
PowerShares Fundamental Pure Small Value Portfolio
PowerShares Global Listed Private Equity Portfolio
PowerShares Golden Dragon China Portfolio
PowerShares High Yield Equity Dividend Achievers TM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares S&P 500® High Quality Portfolio
PowerShares Water Resources Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares WilderHill Progressive Energy Portfolio
PowerShares Zacks Micro Cap Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year, ten-year and since-inception periods ended December 31, 2013, as applicable, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
explanations for any tracking error. The Trustees noted that for each applicable period the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s advisory fee and net expense ratio, as compared to information compiled by the Adviser from Lipper Inc. databases on the advisory fees and net expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual advisory fee charged to each Fund is:
— | 0.50% of the Fund’s average daily net assets for each Fund other than PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend AchieversTM Portfolio, PowerShares International Dividend AchieversTM Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio; |
— | 0.40% of the Fund’s average daily net assets for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; and |
— | 0.29% of the Fund’s average daily net assets for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio. |
The Trustees also noted that the Adviser has agreed to waive a portion of its advisory fee and/or pay expenses (an “Expense Cap”) to the extent necessary to prevent the annual operating expenses of each Fund from exceeding the percentage of that Fund’s average daily net assets, at least until August 31, 2015, as set forth below:
— | 0.60%, excluding interest expenses, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares DWA NASDAQ Momentum Portfolio and PowerShares Dynamic Market Portfolio; |
— | 0.50%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; |
— | 0.39%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio and PowerShares Fundamental Pure Small Value Portfolio; |
— | 0.29%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares S&P 500® High Quality Portfolio; |
— | 0.60%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio and PowerShares DWA Utilities Momentum Portfolio (the Trustees noted that prior to December 17, 2013, licensing fees were excluded from the Expense Cap); and |
— | 0.60%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each other Fund. |
The Trustees noted that the Adviser represented that it does not serve as the investment adviser to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds, but that the Adviser provides sub-advisory services to clients with comparable investment strategies as certain of the Funds. The Trustees further noted the Adviser’s explanation with respect to the sub-advisory fees it receives for such services in comparison to the advisory fees charged to the Funds. The Trustees noted that each Fund’s advisory fee was:
— | higher than the median advisory fee of its ETF peer funds (except for the advisory fee of each of PowerShares Financial Preferred Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio and PowerShares International Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its ETF peer funds); and |
— | higher than the median advisory fee of its open-end index peer funds (except for the advisory fee of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares High Yield Equity Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median advisory fee of its open-end actively-managed peer funds. |
The Trustees determined that the advisory fees were reasonable, noting the complexity of the indexes, the distinguishing factors of the Funds, and the administrative, operational and management oversight costs for the Adviser. With respect to the Funds’ net expense ratios, the Trustees noted that the net expense ratio for each Fund was:
— | higher than the median net expense ratio of its ETF peer funds (except for the net expense ratio of each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers Portfolio and PowerShares S&P 500® High Quality Portfolio, which was equal to or less than the median net expense ratio of its ETF peer funds); and |
— | higher than the median net expense ratio of its open-end index peer funds (except for the net expense ratio of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio, PowerShares DWA Utilities Momentum Portfolio, PowerShares Dynamic Large Cap Growth Portfolio, PowerShares Dynamic Networking Portfolio, PowerShares Dynamic Semiconductors Portfolio, PowerShares Dynamic Software Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares High Yield Equity |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Dividend Achievers™ Portfolio and PowerShares S&P 500® High Quality Portfolio, which was lower than the median net expense ratio of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median net expense ratio of its open-end actively-managed peer funds. |
The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds, and noted those Funds for which license fees are included in the Funds’ Expense Caps.
The Board concluded that the advisory fee and expense ratio of each Fund (giving effect to the Fund’s Expense Cap) were reasonable and appropriate in light of the services provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to any of the Funds was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size, expense ratio and expense limitation agreed to by the Adviser. The Trustees noted that, for Funds whose expenses are higher than their respective Expense Caps, any reduction in that Fund’s expenses would be enjoyed by the Adviser, but that Fund shareholders benefit from the lower expense ratio as a result of the Fund’s Expense Cap. The Trustees also noted that the Excess Expense Agreement with the Trust provides that the Adviser is entitled to be reimbursed by each Fund, other than PowerShares Dynamic Market Portfolio and PowerShares DWA NASDAQ Momentum Portfolio, for fees waived or expenses absorbed pursuant to the Expense Cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its Expense Cap. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate, noting the Fund expenses the Adviser has borne as a result of the Expense Cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
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Proxy Voting Policies and Procedures
A description of the Trust’s proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 983-0903. This information is also available on the Securities and Exchange Commission’s (“Commission”) website at www.sec.gov.
Information regarding how each Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 983-0903; or (ii) accessing the Trust’s Form N-PX on the Commission’s website at www.sec.gov.
Quarterly Portfolios
The Trust files its complete schedule of portfolio holdings for the Funds with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Trust’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Trust’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
Frequency Distribution of Discounts and Premiums
A table showing the number of days the market price of each Fund’s shares was greater than the Fund’s net asset value, and the number of days it was less than the Fund’s net asset value (i.e., premium or discount) for the most recently completed calendar year, and the calendar quarters since that year end (or the life of the Fund, if shorter) may be found at the Fund’s website at www.invescopowershares.com.
©2014 Invesco PowerShares Capital Management LLC | P-PS-AR-1 | |||||
3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | ||||||
invescopowershares.com 800.983.0903 | @PowerShares |
April 30, 2014 |
2014 Annual Report to Shareholders
PBE | PowerShares Dynamic Biotechnology & Genome Portfolio | |
PKB | PowerShares Dynamic Building & Construction Portfolio | |
PXE | PowerShares Dynamic Energy Exploration & Production Portfolio | |
PBJ | PowerShares Dynamic Food & Beverage Portfolio | |
PEJ | PowerShares Dynamic Leisure and Entertainment Portfolio | |
PBS | PowerShares Dynamic Media Portfolio | |
PXQ | PowerShares Dynamic Networking Portfolio | |
PXJ | PowerShares Dynamic Oil & Gas Services Portfolio | |
PJP | PowerShares Dynamic Pharmaceuticals Portfolio | |
PMR | PowerShares Dynamic Retail Portfolio | |
PSI | PowerShares Dynamic Semiconductors Portfolio | |
PSJ | PowerShares Dynamic Software Portfolio |
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Domestic Equity
The U.S. equity market rose to multiyear or all-time highs during the fiscal year ended April 30, 2014.1 Corporate earnings were resilient in the face of modest economic growth, driven by strong profitability across many sectors, and fundamentals for corporations and consumers remained relatively stable following significant recovery in prior years.
However, the fiscal year began with capital markets in the U.S. declining. In May and June 2013, equity and fixed income markets fell following then-U.S. Federal Reserve (the “Fed”) Chairman Ben Bernanke’s comments suggesting that the time was approaching to reduce, or “taper,” the size of its bond buying economic stimulus program. This sell-off was brief but broad, and few asset classes were immune. Markets stabilized in mid-summer and generally rose, with some brief interruptions, through the end of 2013. The Fed’s announcement in December that tapering of its bond purchases would begin in early 2014 had little effect on equities as the announcement was widely anticipated. After strong performance in the second half of 2013, the U.S. equity market turned volatile in the first four months of 2014 as investors worried that stocks may have risen too high, too fast in 2013. Adding to this investor uncertainty during 2014 was political upheaval in Ukraine and signs of economic sluggishness in the U.S. and China.
1 | Source: Reuters |
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PBE | Manager’s Analysis | |
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) |
As an index fund, the PowerShares Dynamic Biotechnology & Genome Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Biotech & Genome IntellidexSM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of biotechnology companies and genome companies that comprise the Index. These companies are engaged principally in the research, development, manufacture and marketing and distribution of various biotechnological products, services and processes, and are companies that benefit significantly from scientific and technological advances in biotechnology and genetic engineering and research.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 biotechnology and genome stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked the stocks based on their capital appreciation potential using a proprietary NYSE Arca IntellidexSM model. The Index Provider separates them into two modified equally-weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 40.36%. On a net asset value (“NAV”) basis, the Fund returned 40.52%. During the same time period, the Index returned 41.13%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Biotech Index (the “Benchmark Index”) returned 30.46%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 15 securities. The Fund provided this comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a benchmark similar to the Index.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a useful representation of the biotech industry market. It is important to note, however, that the Index includes stocks from its Biotechnology & Genome Group Universe of which
approximately 90% are considered pharmaceuticals, biotechnology & life sciences, while the remaining 10% of the Index contains stocks in other industry groups including materials, health care equipment & services, and technology hardware & equipment. The Benchmark Index contains 100% biotechnology companies. This Benchmark Index is relevant as a comparison, but the disparity compared to pure biotechnology exposure may produce potentially significant differences in performance when compared to the Fund. Relative to the Benchmark Index, the Fund was most overweight in the life sciences tool & services sub-industry and most underweight in the biotechnologies sector during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during the period can be attributed to specific stock performance within the biotechnology sub-industry as well as to the exposure disparity previously noted.
For the fiscal year ended April 30, 2014, the biotechnology sub-industry contributed most significantly to the Fund’s return, followed by the life sciences tools & services and chemicals sub-industries, respectively. Pharmaceuticals was the only detracting sub-industry.
Positions that contributed most significantly to the Fund’s return included Illumina, Inc., a life sciences tools & services company (portfolio average weight of 5.17%), and Alnylam Pharmaceuticals, a biotechnology company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Acorda Therapeutics, Inc. , a biotechnology company (portfolio average weight of 2.61%), and Dyax Corp., a biotechnology company (portfolio average weight of 1.02%).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Biotechnology | 67.2 | |||
Life Sciences Tools & Services | 18.8 | |||
Specialty Chemicals | 5.8 | |||
Health Care Supplies | 3.0 | |||
Pharmaceuticals | 2.8 | |||
Electronic Equipment & Instruments | 2.4 | |||
Money Market Funds Plus Other Assets Less Liabilities | (0.0) |
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PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Sigma-Aldrich Corp. | 5.8 | |||
Gilead Sciences, Inc. | 5.4 | |||
Amgen, Inc. | 5.1 | |||
Alexion Pharmaceuticals, Inc. | 5.1 | |||
Regeneron Pharmaceuticals, Inc. | 5.1 | |||
Biogen Idec, Inc. | 4.8 | |||
Illumina, Inc. | 4.5 | |||
Pharmacyclics, Inc. | 3.9 | |||
Myriad Genetics, Inc. | 3.6 | |||
Emergent Biosolutions, Inc. | 3.3 | |||
Total | 46.6 |
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PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Biotech & Genome IntellidexSM Index | 41.13 | % | 20.47 | % | 74.83 | % | 26.31 | % | 221.54 | % | 12.49 | % | 183.45 | % | ||||||||||||||||
S&P Composite 1500 Biotech Index | 30.46 | 38.23 | 164.13 | 27.69 | 239.40 | 16.54 | 287.76 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 40.52 | 19.72 | 71.61 | 25.33 | 209.27 | 11.93 | 171.22 | |||||||||||||||||||||||
Market Price Return | 40.36 | 19.62 | 71.18 | 25.37 | 209.75 | 11.91 | 170.83 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.63%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the
table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
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PKB | Manager’s Analysis | |
PowerShares Dynamic Building & Construction Portfolio (PKB) |
As an index fund, the PowerShares Dynamic Building & Construction Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Building & Construction Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of building and construction companies that comprise the Index. These companies are engaged primarily in providing construction and related engineering services for building and remodeling residential properties, commercial or industrial buildings, or working on large-scale infrastructure projects, such as highways, tunnels, bridges, dams, power lines and airports.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 building and construction stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked companies based on their capital appreciation potential using a proprietary NYSE Arca Intellidexsm model. The Index Provider separates them into two modified equally-weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 12.58%. On a net asset value (“NAV”) basis, the Fund returned 12.42%. During the same time period, the Index returned 13.20%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Construction & Engineering Index (the “Benchmark Index”) returned 19.55%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 12 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of another building & construction industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a representation of the building & construction industry market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a modified equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the building products sub-industry and most underweight in the construction & engineering sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the Fund’s allocation to the homebuilding sub-industry.
For the fiscal year ended April 30, 2014, the construction & engineering sub-industry contributed most significantly to the Fund’s return, followed by the construction materials and industrial machinery sectors, respectively. The homebuilding sub-industry detracted most significantly from the Fund’s return, followed by the forest products and oil & gas equipment & services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Ingersoll-Rand PLC, an industrial machinery company (no longer held at fiscal year-end), and Vulcan Materials Co., a construction materials company (portfolio average weight of 3.31%). Positions that detracted most significantly from the Fund’s return included PulteGroup, Inc., a homebuilding company (portfolio average weight of 2.34%), and Gibraltar Industries, Inc., a building products company (no longer held at fiscal year-end).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Construction & Engineering | 27.0 | |||
Construction Materials | 13.4 | |||
Homebuilding | 9.9 | |||
Home Improvement Retail | 9.8 | |||
Construction Machinery & Heavy Trucks | 8.4 | |||
Building Products | 7.8 | |||
Forest Products | 7.6 | |||
Home Furnishings | 4.9 | |||
Heavy Electrical Equipment | 3.0 | |||
Environmental & Facilities Services | 2.8 | |||
Industrial Machinery | 2.7 | |||
Oil & Gas Equipment & Services | 2.7 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) |
| 7 |
|
PowerShares Dynamic Building & Construction Portfolio (PKB) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Quanta Services, Inc. | 5.2 | |||
Fluor Corp. | 5.1 | |||
Home Depot, Inc. (The) | 5.0 | |||
Jacobs Engineering Group, Inc. | 4.9 | |||
Vulcan Materials Co. | 4.9 | |||
Mohawk Industries, Inc. | 4.9 | |||
Lowe’s Cos., Inc. | 4.8 | |||
PulteGroup, Inc. | 4.6 | |||
Tutor Perini Corp. | 3.4 | |||
Babcock & Wilcox Co. (The) | 3.0 | |||
Total | 45.8 |
| 8 |
|
PowerShares Dynamic Building & Construction Portfolio (PKB) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Building & Construction IntellidexSM Index | 13.20 | % | 17.39 | % | 61.77 | % | 17.64 | % | 125.28 | % | 6.22 | % | 67.21 | % | ||||||||||||||||
S&P Composite 1500 Construction & Engineering Index | 19.55 | 5.60 | 17.75 | 10.33 | 63.48 | 9.27 | 112.64 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 12.42 | 16.38 | 57.64 | 16.68 | 116.29 | 5.30 | 55.24 | |||||||||||||||||||||||
Market Price Return | 12.58 | 16.45 | 57.93 | 16.65 | 116.00 | 5.30 | 55.21 |
Fund Inception: October 26, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.69%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 9 |
|
PXE | Manager’s Analysis | |
PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) |
As an index fund, the PowerShares Dynamic Energy Exploration & Production Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Energy Exploration & Production Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies engaged in energy exploration and production that comprise the Index. These companies are engaged principally in exploration, extraction and production of crude oil and natural gas from land-based or offshore wells.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 energy exploration and production stocks from the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked the stocks for investment potential using a proprietary model. The Index Provider splits stocks in the Energy Exploration & Production Industry Group Universe into quintiles based on market capitalization. The Index Provider includes 8 of the top-ranked relatively larger stocks which collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and 22 of the top-ranked relatively smaller stocks which collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 27.10%. On a net asset value (“NAV”) basis, the Fund returned 26.93%. During the same time period, the Index returned 27.79%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Oil & Gas Exploration & Production Index (the “Benchmark Index”) returned 30.94%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 36 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar energy exploration & production industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its shared exposure to the oil & gas exploration & production industry.
The performance of the Fund differed from the Benchmark Index in part because the Fund employs a modified equal weighting and stock selection methodology whereas the indexes select and weight stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the oil & gas refining & marketing sub-industry and most underweight in the oil & gas exploration & production sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the Fund’s overweighting to the oil & gas refining & marketing sub-industry, which did not perform as well as the oil & gas exploration & production sub-industry.
For the fiscal year ended April 30, 2014, the oil & gas exploration & production sub-industry contributed most significantly to the Fund’s return, followed by the oil & gas refining & marketing and integrated oil & gas sub-industries, respectively. Gas utilities was the only detracting sub-industry.
Positions that contributed most significantly to the Fund’s return included Stone Energy Corp., an oil & gas exploration & production company (portfolio average weight of 2.94%), and Valero Energy Corp., an oil & gas refining & marketing company (portfolio average weight of 4.99%). Positions that detracted most significantly from the Fund’s return included Swift Energy Co., an oil & gas exploration & production company (no longer held at fiscal year-end), and CVR Refining LP, an oil & gas refining & marketing company (no longer held at fiscal year-end).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Oil & Gas Exploration & Production | 58.0 | |||
Oil & Gas Refining & Marketing | 35.1 | |||
Integrated Oil & Gas | 4.4 | |||
Gas Utilities | 2.5 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0 | ) | ||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Valero Energy Corp. | 5.3 | |||
Phillips 66 | 4.9 | |||
Marathon Petroleum Corp. | 4.9 | |||
Apache Corp. | 4.8 | |||
Devon Energy Corp. | 4.8 | |||
Marathon Oil Corp. | 4.8 | |||
EOG Resources, Inc. | 4.6 | |||
Occidental Petroleum Corp. | 4.4 | |||
Clayton Williams Energy, Inc. | 3.6 | |||
Comstock Resources, Inc. | 3.4 | |||
Total | 45.5 |
| 10 |
|
PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Energy Exploration & Production IntellidexSM Index | 27.79 | % | 13.88 | % | 47.68 | % | 26.06 | % | 218.38 | % | 12.35 | % | 169.38 | % | ||||||||||||||||
S&P Composite 1500 Oil & Gas Exploration & Production Index | 30.94 | 5.02 | 15.84 | 16.51 | 114.67 | 9.60 | 118.21 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 26.93 | 13.01 | 44.33 | 25.12 | 206.60 | 11.62 | 154.88 | |||||||||||||||||||||||
Market Price Return | 27.10 | 13.04 | 44.43 | 25.15 | 207.07 | 11.61 | 154.57 |
Fund Inception: October 26, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.69%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 11 |
|
PBJ | Manager’s Analysis | |
PowerShares Dynamic Food & Beverage Portfolio (PBJ) |
As an index fund, the PowerShares Dynamic Food & Beverage Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Food & Beverage IntellidexSM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of food and beverage companies that comprise the Index. These companies are engaged principally in the manufacture, sale or distribution of food and beverage products, agricultural products and products related to the development of new food technologies.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 food and beverage stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ after having ranked the stocks based on their capital appreciation potential using a proprietary NYSE Arca IntellidexSM model. The Index Provider separates them into two modified equally-weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 15.25%. On a net asset value (“NAV”) basis, the Fund returned 15.16%. During the same time period, the Index returned 16.00%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Food Beverage & Tobacco Index (the “Benchmark Index”) returned 8.97%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 50 securities. The Fund provided this comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar food & beverage benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the food & beverage market.
The performance of the Fund differed from the Benchmark Index in part because the Fund employs a modified equal weighting and stock selection methodology whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, the Fund benefited from exposure to the restaurant sub-industry and being overweight in the packaged foods & meats
sub-industry during the fiscal year ended April 30, 2014. The Fund was most underweight in the tobacco sub-industry during the period. The majority of the Fund’s outperformance relative to the Benchmark Index during the period can be attributed to these sub-industry allocations.
For the fiscal year ended April 30, 2014, the packaged foods & meats sub-industry contributed most significantly to the Fund’s return, followed by the restaurants and food distributors sub-industries, respectively. The fertilizers & agricultural chemicals sub-industry detracted most significantly from the Fund’s return, followed by the soft drinks and data processing & outsourced services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Pilgrim’s Pride Corp., a packaged foods & meats company (portfolio average weight of 2.97%), and Andersons, Inc. (The), a food distributors company (portfolio average weight of 2.86%). Positions that detracted most significantly from the Fund’s return included Chiquita Brands International, Inc., a packaged foods & meats company (no longer held at fiscal year-end), and Starbucks Corp., a restaurants company (no longer held at fiscal year-end).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Packaged Foods & Meats | 45.7 | |||
Food Retail | 20.3 | |||
Soft Drinks | 10.8 | |||
Food Distributors | 10.5 | |||
Agricultural Products | 5.3 | |||
Restaurants | 4.8 | |||
Distillers & Vintners | 2.6 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0 | ) | ||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Kroger Co. (The) | 5.4 | |||
Archer-Daniels-Midland Co. | 5.3 | |||
General Mills, Inc. | 5.2 | |||
Mondelez International, Inc., Class A | 5.1 | |||
Kraft Foods Group, Inc. | 5.0 | |||
Sysco Corp. | 5.0 | |||
Whole Foods Market, Inc. | 4.5 | |||
Hershey Co. (The) | 4.5 | |||
Pilgrim’s Pride Corp. | 3.3 | |||
Andersons, Inc. (The) | 3.0 | |||
Total | 46.3 |
| 12 |
|
PowerShares Dynamic Food & Beverage Portfolio (PBJ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Food & Beverage IntellidexSM Index | 16.00 | % | 12.99 | % | 44.25 | % | 18.59 | % | 134.56 | % | 9.25 | % | 118.87 | % | ||||||||||||||||
S&P Composite 1500 Food Beverage & Tobacco Index | 8.97 | 14.64 | 50.68 | 21.06 | 160.05 | 12.71 | 188.41 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 15.16 | 12.21 | 41.29 | 17.73 | 126.19 | 8.52 | 106.18 | |||||||||||||||||||||||
Market Price Return | 15.25 | 12.13 | 40.98 | 17.72 | 126.10 | 8.52 | 106.25 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.63%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 13 |
|
PEJ | Manager’s Analysis | |
PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ) |
As an index fund, the PowerShares Dynamic Leisure and Entertainment Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Leisure & Entertainment IntellidexSM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of leisure companies and entertainment companies that comprise the Index. These companies are engaged principally in the design, production or distribution of goods or services in the leisure and entertainment industries.
NYSE Arca, Inc. (or the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 leisure and entertainment stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked the stocks based on their capital appreciation potential using a proprietary NYSE Arca IntellidexSM model. The Index Provider separates them into two modified equally-weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 19.34%. On a net asset value (“NAV”) basis, the Fund returned 19.29%. During the same time period, the Index returned 20.19%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Hotels, Restaurants & Leisure Index (the “Benchmark Index”) returned 14.45%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 42 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to other indices in the leisure & entertainment industry.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the leisure & entertainment industry.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a modified equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the movies & entertainment sub-industry and most underweight in the restaurants sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to specific stock performance within the restaurants sub-industry.
For the fiscal year ended April 30, 2014, the restaurants sub-industry contributed most significantly to the Fund’s return, followed by the casinos & gaming and broadcasting sub-industries, respectively. The Internet retail sub-industry detracted most significantly from the Fund’s return, followed by the cable & satellite and hotel & resort REITs sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Wynn Resorts Ltd., a casinos & gaming company (portfolio average weight of 3.41%), and Sonic Corp., a restaurants company (portfolio average weight of 2.88%). Positions that detracted most significantly from the Fund’s return included TripAdvisor, Inc., an Internet retail company (portfolio average weight of 0.75%), and Panera Bread Co., Class A, a restaurants company (portfolio average weight of 0.43%).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Restaurant | 39.7 | |||
Hotels, Resorts & Cruise Lines | 16.8 | |||
Casinos & Gaming | 12.3 | |||
Internet Retail | 11.7 | |||
Movies & Entertainment | 10.8 | |||
Leisure Facilities | 5.8 | |||
Cable & Satellite | 3.0 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.1 | ) | ||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Marriott International, Inc., Class A | 5.8 | |||
Walt Disney Co. (The) | 5.3 | |||
Hilton Worldwide Holdings, Inc. | 5.3 | |||
Las Vegas Sands Corp. | 5.0 | |||
Chipotle Mexican Grill, Inc. | 4.8 | |||
Priceline Group, Inc. (The) | 4.6 | |||
Wynn Resorts Ltd. | 4.6 | |||
TripAdvisor, Inc. | 4.4 | |||
AMC Entertainment Holdings, Inc., Class A | 3.0 | |||
Starz, Class A | 3.0 | |||
Total | 45.8 |
| 14 |
|
PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Leisure & Entertainment IntellidexSM Index | 20.19 | % | 20.39 | % | 74.47 | % | 26.82 | % | 228.09 | % | 10.91 | % | 150.02 | % | ||||||||||||||||
S&P Composite 1500 Hotels, Restaurants & Leisure Index | 14.45 | 15.63 | 54.62 | 21.79 | 167.97 | 11.39 | 159.94 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 19.29 | 19.44 | 70.38 | 25.66 | 213.32 | 10.26 | 137.43 | |||||||||||||||||||||||
Market Price Return | 19.34 | 19.42 | 70.33 | 25.70 | 213.81 | 10.26 | 137.42 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.69%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the
table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 15 |
|
PBS | Manager’s Analysis | |
PowerShares Dynamic Media Portfolio (PBS) |
As an index fund, the PowerShares Dynamic Media Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Media IntellidexSM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of media companies that comprise the Index. These companies are engaged principally in the development, production, sale and distribution of goods or services used in the media industry.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 media stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ. NYSE Arca, Inc., after having ranked the stocks based on their capital appreciation potential using a proprietary NYSE Arca IntellidexSM model. The Index Provider separates them into two modified equally-weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 18.83%. On a net asset value (“NAV”) basis, the Fund returned 18.87%. During the same time period, the Index returned 19.74%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Media Index (the “Benchmark Index”) returned 25.33%. The S&P Composite 1500 Media Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 29 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a media industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the media industry market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a modified equal weighting and stock selection methodology whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the Internet software & services sub-industry and most underweight in the movies & entertainment sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the Fund’s allocation to the IT consulting & other services and advertising sub-industries.
For the fiscal year ended April 30, 2014, the Internet software & services sub-industry contributed most significantly to the Fund’s return, followed by the cable & satellite and broadcasting sub-industries, respectively. The IT consulting & other services sub-industry detracted most significantly from the Fund’s return, followed by the diversified support services and Internet retail sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Yahoo! Inc., an Internet software & services company (no longer held at fiscal year-end), and Shutterstock, Inc., an Internet software & services company (portfolio average weight of 2.97%). Positions that detracted most significantly from the Fund’s return included Conversant Inc., an Internet software & services company (no longer held at fiscal year-end), and Acxiom Corp., an IT consulting & other services company (portfolio average weight of 0.41%).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Internet Software & Services | 25.4 | |||
Cable & Satellite | 19.5 | |||
Broadcasting | 10.5 | |||
Advertising | 8.5 | |||
Publishing | 8.5 | |||
Movies & Entertainment | 8.0 | |||
Internet Retail | 6.1 | |||
IT Consulting & Other Services | 5.1 | |||
Catalog Retail | 3.0 | |||
Specialized Finance | 2.8 | |||
Data Processing & Outsourced Services | 2.6 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) |
| 16 |
|
PowerShares Dynamic Media Portfolio (PBS) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Time Warner Cable, Inc. | 5.6 | |||
DIRECTV | 5.5 | |||
Walt Disney Co. (The) | 5.4 | |||
DISH Network Corp., Class A | 5.3 | |||
Facebook, Inc., Class A | 4.8 | |||
CBS Corp., Class B | 4.8 | |||
Netflix, Inc. | 4.0 | |||
HSN, Inc. | 3.0 | |||
Starz, Class A | 3.0 | |||
Blucora, Inc. | 3.0 | |||
Total | 44.4 |
| 17 |
|
PowerShares Dynamic Media Portfolio (PBS) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Media IntellidexSM Index | 19.74 | % | 16.68 | % | 58.86 | % | 25.46 | % | 210.86 | % | 6.69 | % | 77.47 | % | ||||||||||||||||
S&P Composite 1500 Media Index | 25.33 | 23.29 | 87.42 | 30.27 | 275.22 | 10.38 | 139.76 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 18.87 | 15.82 | 55.36 | 24.30 | 196.75 | 6.08 | 68.61 | |||||||||||||||||||||||
Market Price Return | 18.83 | 15.79 | 55.23 | 24.25 | 196.14 | 6.07 | 68.47 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.63%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 18 |
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PXQ | Manager’s Analysis | |
PowerShares Dynamic Networking Portfolio (PXQ) |
As an index fund, the PowerShares Dynamic Networking Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Networking Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of networking companies that comprise the Index. These companies are engaged principally in the development, manufacture, sale or distribution of products, services or technologies that support the flow of electronic information, including voice, data, images and commercial transactions.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 common stocks of networking companies in the Index principally on the basis of their capital appreciation potential that NYSE Arca identifies pursuant to a proprietary selection methodology. The Index Provider includes networking stocks from the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked the stocks for investment potential using a proprietary model. The Index Provider splits stocks in the Networking Group Universe into quintiles based on market capitalization. Larger stocks are defined by inclusion in the top quintile and smaller stocks are the bottom four quintiles. The Index Provider includes 8 of the top-ranked relatively larger stocks which collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and 22 of the top-ranked relatively smaller stocks which collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 25.80%. On a net asset value (“NAV”) basis, the Fund returned 25.69%. During the same time period, the Index returned 26.58%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Communications Equipment Index (the “Benchmark Index”) returned 22.58%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 27 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar networking industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its shared exposure to the communications equipment industry. These reasons make its performance relevant when comparing to the Fund’s performance. The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an Index that employs a modified equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the systems software sub-industry and most underweight in the communications equipment sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to the Fund’s allocation to the application software sub-industry.
For the fiscal year ended April 30, 2014, the communications equipment sub-industry contributed most significantly to the Fund’s return, followed by the systems software and electronic components sub-industries, respectively. Application software was the only detracting sector.
Positions that contributed most significantly to the Fund’s return included Finisar Corp., a communications equipment company (portfolio average weight of 3.03%), and Juniper Networks, Inc., a communications equipment company (portfolio average weight of 5.14%). Positions that detracted most significantly from the Fund’s return included Gigamon Inc., a systems software company (portfolio average weight of 1.63%), and SolarWinds, Inc., an application software company (portfolio average weight of 1.25%).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Communications Equipment | 61.6 | |||
Systems Software | 15.0 | |||
Electronic Components | 8.8 | |||
Application Software | 5.5 | |||
Internet Software & Services | 3.2 | |||
Technology Hardware, Storage & Peripherals | 3.0 | |||
Semiconductors | 2.9 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0 | ) |
| 19 |
|
PowerShares Dynamic Networking Portfolio (PXQ) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Amphenol Corp., Class A | 5.8 | |||
Cisco Systems, Inc. | 5.7 | |||
QUALCOMM, Inc. | 5.6 | |||
VMware, Inc., Class A | 5.1 | |||
Motorola Solutions, Inc. | 5.1 | |||
F5 Networks, Inc. | 5.0 | |||
Juniper Networks, Inc. | 4.9 | |||
Palo Alto Networks, Inc. | 4.8 | |||
Finisar Corp. | 3.2 | |||
CommScope Holding Co., Inc. | 3.2 | |||
Total | 48.4 |
| 20 |
|
PowerShares Dynamic Networking Portfolio (PXQ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | �� | Avg. Ann.†† | Cumulative | |||||||||||||||||||||||||||
Dynamic Networking IntellidexSM Index | 26.58 | % | 3.32 | % | 10.29 | % | 19.31 | % | 141.74 | % | 9.54 | % | 124.11 | % | ||||||||||||||||
S&P Composite 1500 Communications Equipment Index | 22.58 | 9.32 | 30.64 | 10.53 | 64.95 | 4.61 | 48.98 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 25.69 | 2.56 | 7.86 | 18.45 | 133.22 | 8.82 | 111.40 | |||||||||||||||||||||||
Market Price Return | 25.80 | 2.54 | 7.83 | 18.41 | 132.81 | 8.82 | 111.33 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio indicated as 0.75%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 21 |
|
PXJ | Manager’s Analysis | |
PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) |
As an index fund, the PowerShares Dynamic Oil & Gas Services Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Oil Services Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that assist in the production, processing and distribution of oil and gas that comprise the Index. These companies are engaged in the drilling of oil and gas wells; manufacturing oil and gas field machinery and equipment; or providing services to the oil and gas industry, such as well analysis, platform and pipeline engineering and construction, logistics and transportation services, oil and gas well emergency management and geophysical data acquisition and processing.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 common stocks of oil and gas services companies in the Index principally on the basis of their capital appreciation potential that NYSE Arca identifies pursuant to a proprietary selection methodology. The Index Provider includes stocks of companies that provide support for oil and gas operations from the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked the stocks for investment potential using a proprietary model. The Index Provider splits stocks in the Oil Services Industry Group Universe into quintiles based on market capitalization. Larger stocks are defined by inclusion in the top quintile and smaller stocks are the bottom four quintiles. The Index Provider includes 8 of the top-ranked relatively larger stocks which collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and 22 of the top-ranked relatively smaller stocks which collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 24.94%. On a net asset value (“NAV”) basis, the Fund returned 24.98%. During the same time period, the Index returned 25.79%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Energy Equipment & Services Index (the “Benchmark Index”) returned 28.81%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 37 securities. The Fund provided this additional comparative benchmark to help investors better understand how
the investment results of the Fund compare to the performance of a similar oil & gas services industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the oil & gas services industry market.
The performance of the Fund differed from the Benchmark Index in part because the Fund employs a modified equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the oil & gas drilling sub-industry and most underweight in the oil & gas equipment & services sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the Fund’s allocation to the oil & gas equipment & services sub-industry as well as the Fund’s specific stock performance within this sub-industry.
For the fiscal year ended April 30, 2014, the oil & gas equipment & services sub-industry contributed most significantly to the Fund’s return, followed by the oil & gas drilling and oil & gas storage & transportation sectors, respectively. The specialty chemicals sub-industry detracted most significantly from the Fund’s return, followed by the diversified chemicals and steel sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Helmerich & Payne, Inc., an oil & gas drilling company (portfolio average weight of 4.02%), and Baker Hughes Inc., an oil & gas equipment & services company (portfolio average weight of 4.57%). Positions that detracted most significantly from the Fund’s return included Noble Corp. PLC, an oil & gas drilling company (no longer held at fiscal year-end), and Transocean Ltd., an oil & gas drilling company (portfolio average weight of 4.25%).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Oil & Gas Equipment & Services | 74.0 | |||
Oil & Gas Drilling | 26.0 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) |
| 22 |
|
PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Weatherford International Ltd. | 5.9 | |||
Halliburton Co. | 5.2 | |||
Baker Hughes, Inc. | 5.2 | |||
Helmerich & Payne, Inc. | 5.1 | |||
Schlumberger Ltd. | 5.1 | |||
National Oilwell Varco, Inc. | 4.8 | |||
Transocean Ltd. | 4.7 | |||
Cameron International Corp. | 4.7 | |||
Pioneer Energy Services Corp. | 3.3 | |||
RPC, Inc. | 3.1 | |||
Total | 47.1 |
| 23 |
|
PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Oil Services IntellidexSM Index | 25.79 | % | 2.88 | % | 8.88 | % | 17.59 | % | 124.87 | % | 7.32 | % | 82.41 | % | ||||||||||||||||
S&P Composite 1500 Energy Equipment & Services Index | 28.81 | 3.52 | 10.94 | 19.28 | 141.44 | 8.93 | 107.15 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 24.98 | 2.19 | 6.70 | 16.75 | 116.88 | 6.69 | 73.48 | |||||||||||||||||||||||
Market Price Return | 24.94 | 2.17 | 6.67 | 16.70 | 116.47 | 6.68 | 73.41 |
Fund Inception: October 26, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.62%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 24 |
|
PJP | Manager’s Analysis | |
PowerShares Dynamic Pharmaceuticals Portfolio (PJP) |
As an index fund, the PowerShares Dynamic Pharmaceuticals Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Pharmaceutical Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of pharmaceutical companies that comprise the Index. These companies are engaged principally in the research, development, manufacture, sale or distribution of pharmaceuticals and drugs of all types.
NYSE Arca, Inc. (or the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 pharmaceuticals stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ after having ranked the stocks based on their capital appreciation potential using a proprietary NYSE Arca Intellidexsm model. The Index Provider separates them into two modified equally-weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 42.15%. On a net asset value (“NAV”) basis, the Fund returned 42.27%. During the same time period, the Index returned 43.10%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Pharmaceuticals Index (the “Benchmark Index”) returned 25.10%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 19 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar pharmaceuticals industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the pharmaceuticals industry market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a modified equal weighting and stock selection methodology whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Index, the Fund was most overweight in the biotechnology sub-industry and most underweight in the pharmaceuticals sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to these allocations.
For the fiscal year ended April 30, 2014, the pharmaceuticals sub-industry contributed most significantly to the Fund’s return, followed by the biotechnology and health care equipment sub-industries, respectively. There were no detracting sectors.
Positions that contributed most significantly to the Fund’s return included Questcor Pharmaceuticals, Inc., a pharmaceuticals company (portfolio average weight of 3.17%), and Forest Laboratories, Inc., a pharmaceuticals company (portfolio average weight of 3.01%). Positions that detracted most significantly from the Fund’s return included VIVUS, Inc., a pharmaceuticals company (no longer held at fiscal year-end), and Medicines Co., a pharmaceuticals company (portfolio average weight of 2.71%).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Pharmaceuticals | 72.8 | |||
Biotechnology | 21.2 | |||
Health Care Equipment | 6.0 | |||
Money Market Funds Plus Other Assets Less Liabilities | (0.0 | ) | ||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Johnson & Johnson | 5.7 | |||
Merck & Co., Inc. | 5.3 | |||
Eli Lilly & Co. | 5.1 | |||
Pfizer, Inc. | 5.0 | |||
Gilead Sciences, Inc. | 4.9 | |||
Bristol-Myers Squibb Co. | 4.8 | |||
Amgen, Inc. | 4.6 | |||
Biogen Idec, Inc. | 4.3 | |||
Questcor Pharmaceuticals, Inc. | 4.0 | |||
Allergan, Inc. | 3.8 | |||
Total | 47.5 |
| 25 |
|
PowerShares Dynamic Pharmaceuticals Portfolio (PJP) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Pharmaceutical IntellidexSM Index | 43.10 | % | 32.22 | % | 131.13 | % | 35.10 | % | 350.08 | % | 18.20 | % | 339.49 | % | ||||||||||||||||
S&P Composite 1500 Pharmaceuticals Index | 25.10 | 22.40 | 83.40 | 22.67 | 177.75 | 9.68 | 126.60 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 42.27 | 31.37 | 126.73 | 34.20 | 335.30 | 17.47 | 315.79 | |||||||||||||||||||||||
Market Price Return | 42.15 | 31.30 | 126.36 | 34.16 | 334.62 | 17.46 | 315.70 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.63%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 26 |
|
PMR | Manager’s Analysis | |
PowerShares Dynamic Retail Portfolio (PMR) |
As an index fund, the PowerShares Dynamic Retail Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Retail Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of retail companies that comprise the Index. These companies are engaged principally in operating general merchandise stores such as department stores, discount stores, warehouse clubs and superstores; specialty stores, including apparel, electronics, accessories and footwear stores; and home improvement and home furnishings stores.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 retail stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ after having ranked the stocks based on their capital appreciation potential using a proprietary NYSE Arca Intellidexsm model. The Index Provider separates them into two modified equally-weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 14.81%. On a net asset value (“NAV”) basis, the Fund returned 14.81%. During the same time period, the Index returned 15.85%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period. In addition, this difference between Fund and index return appears slightly exaggerated due to a compounding effect on the index return caused by the Index’s lack of an expense ratio.
During this same time period, the S&P Composite 1500 Retailing Index (the “Benchmark Index”) returned 16.08%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 90 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a retail industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the retail industry market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a modified equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the food retail sub-industry and most underweight in the Internet retail sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to the Fund’s allocation to the drug retail sub-industry.
For the fiscal year ended April 30, 2014, the drug retail sub-industry contributed most significantly to the Fund’s return, followed by the food retail and automotive retail sub-industries, respectively. The home improvement retail sub-industry detracted most significantly from the Fund’s return, followed by the apparel accessories & luxury goods and specialized consumer services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Rite Aid Corp., a drug retail company (portfolio average weight of 3.06%), and Walgreen Co., a drug retail company (portfolio average weight of 5.13%). Positions that detracted most significantly from the Fund’s return included Fairway Group Holdings Corp., a food retail company (no longer held at fiscal year-end), and Sears Hometown & Outlet Stores, Inc., a home improvement retail company (no longer held at fiscal year-end).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Food Retail | 23.6 | |||
Automotive Retail | 15.8 | |||
Drug Retail | 13.0 | |||
Apparel Retail | 8.3 | |||
Specialty Stores | 8.3 | |||
Department Stores | 7.8 | |||
Trucking | 6.0 | |||
Apparel, Accessories & Luxury Goods | 4.7 | |||
Food Distributors | 2.6 | |||
Homefurnishing Retail | 2.6 | |||
Hypermarkets & Super Centers | 2.6 | |||
Specialized Consumer Services | 2.4 | |||
Forest Products | 2.3 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0 | ) |
| 27 |
|
PowerShares Dynamic Retail Portfolio (PMR) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Kroger Co. (The) | 5.5 | |||
Walgreen Co. | 5.0 | |||
CVS Caremark Corp. | 5.0 | |||
Macy’s, Inc. | 5.0 | |||
AutoZone, Inc. | 5.0 | |||
O’Reilly Automotive, Inc. | 4.9 | |||
Michael Kors Holdings Ltd. | 4.7 | |||
Whole Foods Market, Inc. | 4.6 | |||
Asbury Automotive Group, Inc. | 3.3 | |||
Avis Budget Group, Inc. | 3.1 | |||
Total | 46.1 |
| 28 |
|
PowerShares Dynamic Retail Portfolio (PMR) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Retail IntellidexSM Index | 15.85 | % | 17.50 | % | 62.22 | % | 20.11 | % | 149.96 | % | 11.39 | % | 150.34 | % | ||||||||||||||||
S&P Composite 1500 Retailing Index | 16.08 | 18.04 | 64.49 | 22.79 | 179.19 | 10.28 | 130.12 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 14.81 | 16.55 | 58.33 | 19.21 | 140.76 | 10.65 | 136.66 | |||||||||||||||||||||||
Market Price Return | 14.81 | 16.51 | 58.15 | 19.20 | 140.70 | 10.64 | 136.43 |
Fund Inception: October 26, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.74%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not
reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 29 |
|
PSI | Manager’s Analysis | |
PowerShares Dynamic Semiconductors Portfolio (PSI) |
As an index fund, the PowerShares Dynamic Semiconductors Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Semiconductor Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of semiconductor companies that comprise the Index. These companies are engaged principally in the manufacture of semiconductors.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 semiconductor stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked companies based on their capital appreciation potential using a proprietary NYSE Arca Intellidexsm model. The Index Provider separates them into two modified equally weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 36.66%. On a net asset value (“NAV”) basis, the Fund returned 36.38%. During the same time period, the Index returned 37.53%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period. In addition, this difference between Fund and index return appears slightly exaggerated due to a compounding effect on the index’s return caused by the Index’s lack of an expense ratio.
During this same time period, the S&P Composite 1500 Semiconductor Index (the “Benchmark Index”) returned 24.81%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 62 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar semiconductors industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the semiconductors industry.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a modified
equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the semiconductor equipment sub-industry and most underweight in the semiconductors sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed stock selection within the semiconductors sub-industry.
For the fiscal year ended April 30, 2014, the semiconductors sub-industry contributed most significantly to the Fund’s return, followed by the semiconductor equipment sub-sector. Communications equipment was the only detracting sub-industry.
Positions that contributed most significantly to the Fund’s return included Micron Technology, Inc., a semiconductors company (portfolio average weight of 5.59%), and Applied Micro Circuits Corp., a semiconductors company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included InterDigital, Inc., a communications equipment company (no longer held at fiscal year-end), and Semtech Corp., a semiconductors company (no longer held at fiscal year-end).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Semiconductors | 65.2 | |||
Semiconductor Equipment | 29.7 | |||
Communications Equipment | 5.1 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0 | ) | ||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Micron Technology, Inc. | 5.2 | |||
Intel Corp. | 5.2 | |||
QUALCOMM, Inc. | 5.1 | |||
Texas Instruments, Inc. | 4.9 | |||
Applied Materials, Inc. | 4.9 | |||
KLA-Tencor Corp. | 4.8 | |||
Linear Technology Corp. | 4.6 | |||
Xilinx, Inc. | 4.4 | |||
Amkor Technology, Inc. | 3.6 | |||
Kulicke & Soffa Industries, Inc. | 3.4 | |||
Total | 46.1 |
| 30 |
|
PowerShares Dynamic Semiconductors Portfolio (PSI) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Semiconductor IntellidexSM Index | 37.53 | % | 5.67 | % | 17.99 | % | 16.10 | % | 110.94 | % | 4.81 | % | 51.52 | % | ||||||||||||||||
S&P Composite 1500 Semiconductor Index | 24.81 | 6.67 | 21.36 | 16.93 | 118.55 | 4.12 | 42.93 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 36.38 | 4.88 | 15.36 | 15.25 | 103.32 | 4.06 | 42.21 | |||||||||||||||||||||||
Market Price Return | 36.66 | 4.86 | 15.30 | 15.25 | 103.32 | 4.05 | 42.12 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 1.05%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not
reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 31 |
|
PSJ | Manager’s Analysis | |
PowerShares Dynamic Software Portfolio (PSJ) |
As an index fund, the PowerShares Dynamic Software Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the Dynamic Software Intellidexsm Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of software companies that comprise the Index. These companies are engaged principally in the research, design, production or distribution of products or processes that relate to software applications and systems and information-based services.
NYSE Arca, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider includes 30 software stocks from a universe of the 2,000 largest U.S. stocks (by market capitalization) traded on the NYSE, NYSE MKT and the NASDAQ, after having ranked the stocks based on their capital appreciation potential using a proprietary NYSE Arca Intellidexsm model. The Index Provider separates them into two modified equally weighted groups. The 8 top-ranked relatively larger stocks collectively receive 40% of the Index weighting (each stock receives on average a 5% weighting) and the 22 top-ranked relatively smaller stocks collectively receive 60% of the Index weighting (each stock receives on average a 2.7% weighting). The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 12.65%. On a net asset value (“NAV”) basis, the Fund returned 12.60%. During the same time period, the Index returned 13.41%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P Composite 1500 Software & Services Index (the “Benchmark Index”) returned 19.10%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 113 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a similar software industry benchmark.
The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the software industry market.
The performance of the Fund differed from the Benchmark Index in part because the Fund tracks an index that employs a modified
equal weighting and stock selection methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
Relative to the Benchmark Index, the Fund was most overweight in the application software sub-industry and underweight in the systems software sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to both allocations.
For the fiscal year ended April 30, 2014, the application software sub-industry contributed most significantly to the Fund’s return, followed by the health care technology and home entertainment software sub-industries, respectively. The education services sub-industry detracted most significantly from the Fund’s return, followed by the Internet software & services and diversified support services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Adobe Systems Inc., an application software company (no longer held at fiscal year-end), and Medidata Solutions, Inc., a health care technology company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Demandware, Inc., an Internet software & services company (portfolio average weight of 0.38%), and Rovi Corp., a systems software company (no longer held at fiscal year-end).
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Application Software | 39.7 | |||
Home Entertainment Software | 14.3 | |||
Systems Software | 13.6 | |||
Internet Software & Services | 10.6 | |||
Data Processing & Outsourced Services | 8.6 | |||
Health Care Technology | 7.4 | |||
IT Consulting & Other Services | 3.2 | |||
Communications Equipment | 2.6 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0 | ) |
| 32 |
|
PowerShares Dynamic Software Portfolio (PSJ) (continued)
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Microsoft Corp. | 5.8 | |||
Activision Blizzard, Inc. | 5.7 | |||
Electronic Arts, Inc. | 5.5 | |||
Intuit, Inc. | 5.4 | |||
Autodesk, Inc. | 5.1 | |||
CA, Inc. | 5.0 | |||
Cerner Corp. | 4.6 | |||
LogMeIn, Inc. | 3.3 | |||
Splunk, Inc. | 3.2 | |||
Amdocs Ltd. | 3.2 | |||
Total | 46.8 |
| 33 |
|
PowerShares Dynamic Software Portfolio (PSJ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
Dynamic Software IntellidexSM Index | 13.41 | % | 8.04 | % | 26.12 | % | 17.96 | % | 128.39 | % | 10.36 | % | 139.28 | % | ||||||||||||||||
S&P Composite 1500 Software & Services Index | 19.10 | 14.75 | 51.09 | 19.70 | 145.71 | 9.14 | 116.93 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 12.60 | 7.33 | 23.62 | 17.18 | 120.95 | 9.69 | 126.70 | |||||||||||||||||||||||
Market Price Return | 12.65 | 7.28 | 23.47 | 17.16 | 120.76 | 9.67 | 126.35 |
Fund Inception: June 23, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.74%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not
reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 34 |
|
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Biotechnology—67.2% | ||||||||
304,753 | Acorda Therapeutics, Inc.(b) | $ | 10,803,494 | |||||
115,795 | Alexion Pharmaceuticals, Inc.(b) | 18,318,769 | ||||||
165,068 | Amgen, Inc. | 18,446,349 | ||||||
1,715,266 | Arena Pharmaceuticals, Inc.(b)(c) | 10,977,702 | ||||||
60,094 | Biogen Idec, Inc.(b) | 17,254,189 | ||||||
140,416 | Cubist Pharmaceuticals, Inc.(b) | 9,837,545 | ||||||
1,154,745 | Dyax Corp.(b) | 7,632,865 | ||||||
451,352 | Emergent Biosolutions, Inc.(b) | 11,897,639 | ||||||
247,268 | Gilead Sciences, Inc.(b) | 19,408,065 | ||||||
680,879 | ImmunoGen, Inc.(b) | 8,810,574 | ||||||
248,953 | Insys Therapeutics, Inc.(b) | 10,222,010 | ||||||
218,951 | Isis Pharmaceuticals, Inc.(b) | 5,826,286 | ||||||
155,288 | Medivation, Inc.(b) | 9,349,891 | ||||||
308,368 | Myriad Genetics, Inc.(b)(c) | 13,016,213 | ||||||
1,302,956 | PDL BioPharma, Inc.(c) | 11,062,097 | ||||||
147,645 | Pharmacyclics, Inc.(b) | 13,964,264 | ||||||
61,575 | Regeneron Pharmaceuticals, Inc.(b) | 18,281,002 | ||||||
613,539 | Sangamo BioSciences, Inc.(b)(c) | 8,491,380 | ||||||
301,796 | Theravance, Inc.(b)(c) | 8,124,348 | ||||||
110,100 | United Therapeutics Corp.(b) | 11,011,101 | ||||||
|
| |||||||
242,735,783 | ||||||||
|
| |||||||
Electronic Equipment & Instruments—2.4% | ||||||||
108,777 | FEI Co. | 8,649,947 | ||||||
|
| |||||||
Health Care Supplies—3.0% | ||||||||
257,767 | Neogen Corp.(b) | 10,768,216 | ||||||
|
| |||||||
Life Sciences Tools & Services—18.8% | ||||||||
491,043 | Bruker Corp.(b) | 10,144,949 | ||||||
238,338 | Fluidigm Corp.(b) | 8,951,975 | ||||||
119,375 | Illumina, Inc.(b) | 16,217,094 | ||||||
604,241 | Luminex Corp.(b) | 11,607,470 | ||||||
125,685 | Techne Corp. | 11,224,927 | ||||||
100,234 | Waters Corp.(b) | 9,877,058 | ||||||
|
| |||||||
68,023,473 | ||||||||
|
| |||||||
Pharmaceuticals—2.8% | ||||||||
870,332 | Nektar Therapeutics(b) | 10,243,807 | ||||||
|
| |||||||
Specialty Chemicals—5.8% | ||||||||
216,827 | Sigma-Aldrich Corp. | 20,860,926 | ||||||
|
| |||||||
Total Common Stocks (Cost $342,814,273) | 361,282,152 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
156,353 | Invesco Premier Portfolio—Institutional Class(d) (Cost $156,353) | 156,353 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $342,970,626)—100.1% | 361,438,505 | |||||||
|
| |||||||
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—10.6% | ||||||||
38,432,742 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $38,432,742) | $ | 38,432,742 | |||||
|
| |||||||
Total Investments (Cost $381,403,368)—110.7% | 399,871,247 | |||||||
Other assets��less liabilities—(10.7)% | (38,551,537 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 361,319,710 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund's gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman & Co. | $ | 38,022,906 | $ | (38,022,906 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 35 |
|
Schedule of Investments(a)
PowerShares Dynamic Building & Construction Portfolio (PKB)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Building Products—7.8% | ||||||||
70,556 | A.O. Smith Corp. | $ | 3,299,198 | |||||
38,167 | Lennox International, Inc. | 3,199,540 | ||||||
62,929 | Universal Forest Products, Inc. | 3,177,285 | ||||||
|
| |||||||
9,676,023 | ||||||||
|
| |||||||
Construction & Engineering—27.0% | ||||||||
109,784 | AECOM Technology Corp.(b) | 3,559,197 | ||||||
82,756 | Fluor Corp. | 6,264,629 | ||||||
105,996 | Jacobs Engineering Group, Inc.(b) | 6,115,969 | ||||||
126,963 | KBR, Inc. | 3,221,051 | ||||||
182,581 | Quanta Services, Inc.(b) | 6,441,458 | ||||||
142,266 | Tutor Perini Corp.(b) | 4,211,074 | ||||||
75,410 | URS Corp. | 3,553,319 | ||||||
|
| |||||||
33,366,697 | ||||||||
|
| |||||||
Construction Machinery & Heavy Trucks—8.4% | ||||||||
113,333 | Manitowoc Co., Inc. (The) | 3,601,723 | ||||||
60,632 | Oshkosh Corp. | 3,365,682 | ||||||
78,746 | Terex Corp. | 3,408,914 | ||||||
|
| |||||||
10,376,319 | ||||||||
|
| |||||||
Construction Materials—13.4% | ||||||||
263,056 | Headwaters, Inc.(b) | 3,282,939 | ||||||
28,751 | Martin Marietta Materials, Inc. | 3,574,612 | ||||||
41,302 | Texas Industries, Inc.(b) | 3,580,883 | ||||||
94,638 | Vulcan Materials Co. | 6,106,990 | ||||||
|
| |||||||
16,545,424 | ||||||||
|
| |||||||
Environmental & Facilities Services—2.8% | ||||||||
121,418 | Tetra Tech, Inc.(b) | 3,481,054 | ||||||
|
| |||||||
Forest Products—7.6% | ||||||||
118,505 | Boise Cascade Co.(b) | 2,964,995 | ||||||
55,712 | Deltic Timber Corp. | 3,384,504 | ||||||
186,618 | Louisiana-Pacific Corp.(b) | 3,058,669 | ||||||
|
| |||||||
9,408,168 | ||||||||
|
| |||||||
Heavy Electrical Equipment—3.0% | ||||||||
106,390 | Babcock & Wilcox Co. (The) | 3,701,308 | ||||||
|
| |||||||
Home Furnishings—4.9% | ||||||||
45,428 | Mohawk Industries, Inc.(b) | 6,015,122 | ||||||
|
| |||||||
Home Improvement Retail—9.8% | ||||||||
78,373 | Home Depot, Inc. (The) | 6,231,437 | ||||||
128,495 | Lowe's Cos., Inc. | 5,899,206 | ||||||
|
| |||||||
12,130,643 | ||||||||
|
| |||||||
Homebuilding—9.9% | ||||||||
44,701 | Cavco Industries, Inc.(b) | 3,484,443 | ||||||
2,939 | NVR, Inc.(b) | 3,165,303 | ||||||
306,307 | PulteGroup, Inc. | 5,632,986 | ||||||
|
| |||||||
12,282,732 | ||||||||
|
| |||||||
Industrial Machinery—2.7% | ||||||||
34,738 | Hyster-Yale Materials Handling, Inc. | 3,348,396 | ||||||
|
| |||||||
Oil & Gas Equipment & Services—2.7% | ||||||||
108,335 | Matrix Service Co.(b) | 3,355,135 | ||||||
|
| |||||||
Total Common Stocks (Cost $116,515,710) | 123,687,021 | |||||||
|
|
Number of Shares | Value | |||||||
Money Market Fund—0.1% | ||||||||
85,769 | Invesco Premier Portfolio—Institutional Class(c) (Cost $85,769) | $ | 85,769 | |||||
|
| |||||||
Total Investments (Cost $116,601,479)—100.1% | 123,772,790 | |||||||
Other assets less liabilities—(0.1)% | (84,782 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 123,688,008 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 36 |
|
Schedule of Investments(a)
PowerShares Dynamic Energy Exploration & Production Portfolio (PXE)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Gas Utilities—2.5% | ||||||||
132,040 | Questar Corp. | $ | 3,205,931 | |||||
|
| |||||||
Integrated Oil & Gas—4.4% | ||||||||
59,565 | Occidental Petroleum Corp. | 5,703,349 | ||||||
|
| |||||||
Oil & Gas Exploration & Production—58.0% | ||||||||
72,512 | Apache Corp. | 6,294,042 | ||||||
27,104 | Cimarex Energy Co. | 3,228,628 | ||||||
32,327 | Clayton Williams Energy, Inc.(b) | 4,670,605 | ||||||
158,705 | Comstock Resources, Inc. | 4,411,999 | ||||||
66,130 | Contango Oil & Gas Co.(b) | 3,176,885 | ||||||
191,684 | Denbury Resources, Inc. | 3,224,125 | ||||||
89,245 | Devon Energy Corp. | 6,247,150 | ||||||
60,704 | EOG Resources, Inc. | 5,948,992 | ||||||
171,620 | Marathon Oil Corp. | 6,204,063 | ||||||
52,818 | Murphy Oil Corp. | 3,350,246 | ||||||
111,244 | Newfield Exploration Co.(b) | 3,765,609 | ||||||
70,677 | Rosetta Resources, Inc.(b) | 3,345,849 | ||||||
486,196 | SandRidge Energy, Inc.(b) | 3,335,305 | ||||||
42,521 | SM Energy Co. | 3,152,082 | ||||||
75,857 | Southwestern Energy Co.(b) | 3,632,033 | ||||||
87,253 | Stone Energy Corp.(b) | 4,279,760 | ||||||
208,091 | W&T Offshore, Inc. | 3,995,347 | ||||||
45,638 | Whiting Petroleum Corp.(b) | 3,364,433 | ||||||
|
| |||||||
75,627,153 | ||||||||
|
| |||||||
Oil & Gas Refining & Marketing—35.1% | ||||||||
234,201 | Alon USA Energy, Inc. (Israel) | 3,815,134 | ||||||
220,222 | Alon USA Partners LP (Israel) | 4,054,287 | ||||||
112,968 | Delek US Holdings, Inc. (Israel) | 3,613,846 | ||||||
68,815 | HollyFrontier Corp. | 3,618,981 | ||||||
68,446 | Marathon Petroleum Corp. | 6,362,056 | ||||||
129,691 | Northern Tier Energy LP | 3,502,954 | ||||||
124,442 | PBF Energy, Inc., Class A | 3,830,325 | ||||||
76,801 | Phillips 66 | 6,391,379 | ||||||
119,825 | Valero Energy Corp. | 6,850,395 | ||||||
86,035 | Western Refining, Inc. | 3,742,523 | ||||||
|
| |||||||
45,781,880 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $114,675,073) | 130,318,313 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
53,397 | Invesco Premier Portfolio—Institutional Class(c) (Cost $53,397) | 53,397 | ||||||
|
| |||||||
Total Investments (Cost $114,728,470)—100.1% | 130,371,710 | |||||||
Other assets less liabilities—(0.1)% | (98,812 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 130,272,898 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 37 |
|
Schedule of Investments(a)
PowerShares Dynamic Food & Beverage Portfolio (PBJ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Agricultural Products—5.3% | ||||||||
524,621 | Archer-Daniels-Midland Co. | $ | 22,941,676 | |||||
|
| |||||||
Distillers & Vintners—2.6% | ||||||||
143,378 | Constellation Brands, Inc., Class A(b) | 11,447,300 | ||||||
|
| |||||||
Food Distributors—10.5% | ||||||||
211,851 | Andersons, Inc. (The) | 13,196,199 | ||||||
514,297 | Spartan Stores, Inc. | 11,077,957 | ||||||
591,327 | Sysco Corp. | 21,542,043 | ||||||
|
| |||||||
45,816,199 | ||||||||
|
| |||||||
Food Retail—20.3% | ||||||||
507,857 | Kroger Co. (The) | 23,381,736 | ||||||
285,173 | Natural Grocers by Vitamin Cottage, Inc.(b) | 10,152,159 | ||||||
346,567 | Safeway, Inc. | 11,804,072 | ||||||
1,795,663 | SUPERVALU, Inc.(b) | 12,551,684 | ||||||
230,332 | Weis Markets, Inc. | 10,616,002 | ||||||
394,070 | Whole Foods Market, Inc. | 19,585,279 | ||||||
|
| |||||||
88,090,932 | ||||||||
|
| |||||||
Packaged Foods & Meats—45.7% | ||||||||
221,000 | Cal-Maine Foods, Inc. | 13,178,230 | ||||||
785,528 | Dean Foods Co. | 12,442,763 | ||||||
404,525 | Diamond Foods, Inc.(b) | 12,366,329 | ||||||
425,735 | General Mills, Inc. | 22,572,470 | ||||||
201,282 | Hershey Co. (The) | 19,371,380 | ||||||
309,400 | Hillshire Brands Co. (The) | 11,030,110 | ||||||
125,085 | J & J Snack Foods Corp. | 11,707,956 | ||||||
385,373 | Kraft Foods Group, Inc. | 21,912,309 | ||||||
128,802 | Lancaster Colony Corp. | 12,220,734 | ||||||
625,906 | Mondelez International, Inc., Class A | 22,313,549 | ||||||
662,745 | Pilgrim's Pride Corp. (Brazil)(b) | 14,487,606 | ||||||
151,197 | Sanderson Farms, Inc. | 12,438,977 | ||||||
294,499 | Tyson Foods, Inc., Class A | 12,360,123 | ||||||
|
| |||||||
198,402,536 | ||||||||
|
| |||||||
Restaurants—4.8% | ||||||||
202,227 | Jack in the Box, Inc.(b) | 10,827,233 | ||||||
1,212,728 | Wendy's Co. (The) | 10,077,770 | ||||||
|
| |||||||
20,905,003 | ||||||||
|
| |||||||
Soft Drinks—10.8% | ||||||||
153,594 | Coca-Cola Bottling Co. Consolidated | 12,630,035 | ||||||
246,769 | Coca-Cola Enterprises, Inc. | 11,213,183 | ||||||
222,950 | Dr Pepper Snapple Group, Inc. | 12,355,889 | ||||||
156,999 | Monster Beverage Corp.(b) | 10,512,653 | ||||||
|
| |||||||
46,711,760 | ||||||||
|
| |||||||
Total Common Stocks (Cost $417,487,581) | 434,315,406 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
17,269 | Invesco Premier Portfolio—Institutional Class(c) (Cost $17,269) | 17,269 | ||||||
|
| |||||||
Total Investments (Cost $417,504,850)—100.0% | 434,332,675 | |||||||
Other assets less liabilities—0.0% | 38,675 | |||||||
|
| |||||||
Net Assets—100.0% | $ | 434,371,350 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 38 |
|
Schedule of Investments(a)
PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.1% | ||||||||
Cable & Satellite—3.0% | ||||||||
164,244 | Starz, Class A(b) | $ | 5,300,154 | |||||
|
| |||||||
Casinos & Gaming—12.3% | ||||||||
112,960 | Las Vegas Sands Corp. | 8,938,525 | ||||||
190,653 | MGM Resorts International(b) | 4,810,175 | ||||||
39,715 | Wynn Resorts Ltd. | 8,097,491 | ||||||
|
| |||||||
21,846,191 | ||||||||
|
| |||||||
Hotels, Resorts & Cruise Lines—16.8% | ||||||||
430,668 | Hilton Worldwide Holdings, Inc.(b) | 9,401,483 | ||||||
193,180 | Interval Leisure Group, Inc. | 4,978,249 | ||||||
177,570 | Marriott International, Inc., Class A | 10,286,630 | ||||||
99,234 | Royal Caribbean Cruises Ltd. | 5,272,302 | ||||||
|
| |||||||
29,938,664 | ||||||||
|
| |||||||
Internet Retail—11.7% | ||||||||
66,887 | Expedia, Inc. | 4,748,308 | ||||||
7,138 | Priceline Group, Inc. (The)(b) | 8,264,019 | ||||||
96,067 | TripAdvisor, Inc.(b) | 7,756,450 | ||||||
|
| |||||||
20,768,777 | ||||||||
|
| |||||||
Leisure Facilities—5.8% | ||||||||
98,734 | Cedar Fair LP | 5,122,320 | ||||||
128,736 | Six Flags Entertainment Corp. | 5,167,463 | ||||||
|
| |||||||
10,289,783 | ||||||||
|
| |||||||
Movies & Entertainment—10.8% | ||||||||
229,469 | AMC Entertainment Holdings, Inc., Class A (China)(b) | 5,309,913 | ||||||
170,815 | Lions Gate Entertainment Corp. | 4,531,722 | ||||||
119,162 | Walt Disney Co. (The) | 9,454,313 | ||||||
|
| |||||||
19,295,948 | ||||||||
|
| |||||||
Restaurants—39.7% | ||||||||
186,527 | ARAMARK Holdings Corp. | 5,258,196 | ||||||
11,700 | Biglari Holdings, Inc.(b) | 5,019,534 | ||||||
95,501 | Brinker International, Inc. | 4,692,919 | ||||||
36,223 | Buffalo Wild Wings, Inc.(b) | 5,292,905 | ||||||
197,612 | Burger King Worldwide, Inc. | 5,163,602 | ||||||
17,035 | Chipotle Mexican Grill, Inc.(b) | 8,491,947 | ||||||
66,438 | Domino's Pizza, Inc. | 4,941,658 | ||||||
101,654 | Dunkin' Brands Group, Inc. | 4,626,274 | ||||||
104,572 | Fiesta Restaurant Group, Inc.(b) | 3,828,381 | ||||||
91,428 | Jack in the Box, Inc.(b) | 4,895,055 | ||||||
28,968 | Panera Bread Co., Class A(b) | 4,431,235 | ||||||
103,192 | Papa John's International, Inc. | 4,526,001 | ||||||
257,733 | Sonic Corp.(b) | 4,907,236 | ||||||
548,283 | Wendy's Co. (The) | 4,556,232 | ||||||
|
| |||||||
70,631,175 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $177,687,768) | 178,070,692 | |||||||
|
| |||||||
Number of Shares | Value | |||||||
Money Market Fund—0.0% | ||||||||
14,105 | Invesco Premier Portfolio—Institutional Class(c) (Cost $14,105) | $ | 14,105 | |||||
|
| |||||||
Total Investments (Cost $177,701,873)—100.1% | 178,084,797 | |||||||
Other assets less liabilities—(0.1)% | (154,991 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 177,929,806 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 39 |
|
Schedule of Investments(a)
PowerShares Dynamic Media Portfolio (PBS)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Advertising—8.5% | ||||||||
291,501 | Interpublic Group of Cos., Inc. (The) | $ | 5,077,947 | |||||
96,351 | Lamar Advertising Co., Class A(b) | 4,809,842 | ||||||
68,251 | Omnicom Group, Inc. | 4,619,228 | ||||||
|
| |||||||
14,507,017 | ||||||||
|
| |||||||
Broadcasting—10.5% | ||||||||
141,177 | CBS Corp., Class B | 8,154,384 | ||||||
787,417 | Cumulus Media, Inc., Class A(b) | 5,047,343 | ||||||
63,589 | Scripps Networks Interactive, Inc., Class A | 4,773,626 | ||||||
|
| |||||||
17,975,353 | ||||||||
|
| |||||||
Cable & Satellite—19.5% | ||||||||
122,041 | DIRECTV(b) | 9,470,381 | ||||||
160,949 | DISH Network Corp., Class A(b) | 9,151,560 | ||||||
161,525 | Starz, Class A(b) | 5,212,412 | ||||||
67,480 | Time Warner Cable, Inc. | 9,545,721 | ||||||
|
| |||||||
33,380,074 | ||||||||
|
| |||||||
Catalog Retail—3.0% | ||||||||
90,076 | HSN, Inc. | 5,228,011 | ||||||
|
| |||||||
Data Processing & Outsourced Services—2.6% | ||||||||
18,113 | Alliance Data Systems Corp.(b) | 4,381,535 | ||||||
|
| |||||||
Internet Retail—6.1% | ||||||||
112,607 | HomeAway, Inc.(b) | 3,673,240 | ||||||
21,241 | Netflix, Inc.(b) | 6,840,452 | ||||||
|
| |||||||
10,513,692 | ||||||||
|
| |||||||
Internet Software & Services—25.4% | ||||||||
268,473 | Blucora, Inc.(b) | 5,168,105 | ||||||
25,701 | CoStar Group, Inc.(b) | 4,135,034 | ||||||
138,332 | Facebook, Inc., Class A(b) | 8,269,487 | ||||||
7,791 | Google, Inc., Class A(b) | 4,167,250 | ||||||
7,791 | Google, Inc., Class C(b) | 4,103,208 | ||||||
66,616 | IAC/InterActiveCorp. | 4,415,308 | ||||||
648,113 | Monster Worldwide, Inc.(b) | 4,465,499 | ||||||
51,975 | Shutterstock, Inc.(b) | 3,768,707 | ||||||
116,311 | WebMD Health Corp.(b) | 5,128,152 | ||||||
|
| |||||||
43,620,750 | ||||||||
|
| |||||||
IT Consulting & Other Services—5.1% | ||||||||
138,749 | Acxiom Corp.(b) | 3,918,272 | ||||||
296,692 | Sapient Corp.(b) | 4,827,179 | ||||||
|
| |||||||
8,745,451 | ||||||||
|
| |||||||
Movies & Entertainment—8.0% | ||||||||
167,987 | Lions Gate Entertainment Corp. | 4,456,695 | ||||||
117,181 | Walt Disney Co. (The) | 9,297,141 | ||||||
|
| |||||||
13,753,836 | ||||||||
|
| |||||||
Publishing—8.5% | ||||||||
173,628 | Gannett Co., Inc. | 4,717,473 | ||||||
314,584 | New York Times Co. (The), Class A | 5,058,510 | ||||||
146,413 | Scholastic Corp. | 4,818,452 | ||||||
|
| |||||||
14,594,435 | ||||||||
|
| |||||||
Specialized Finance—2.8% | ||||||||
64,847 | McGraw-Hill Financial, Inc. | 4,794,139 | ||||||
|
| |||||||
Total Common Stocks (Cost $177,278,130) | 171,494,293 | |||||||
|
| |||||||
Number of Shares | Value | |||||||
Money Market Fund—0.1% | ||||||||
104,364 | Invesco Premier Portfolio—Institutional Class(c) (Cost $104,364) | $ | 104,364 | |||||
|
| |||||||
Total Investments (Cost $177,382,494)—100.1% | 171,598,657 | |||||||
Other assets less liabilities—(0.1)% | (168,949 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 171,429,708 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 40 |
|
Schedule of Investments(a)
PowerShares Dynamic Networking Portfolio (PXQ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Application Software—5.5% | ||||||||
22,738 | Netscout Systems, Inc.(b) | $ | 885,873 | |||||
18,701 | SolarWinds, Inc.(b) | 754,024 | ||||||
|
| |||||||
1,639,897 | ||||||||
|
| |||||||
Communications Equipment—61.6% | ||||||||
32,962 | ADTRAN, Inc. | 739,338 | ||||||
30,091 | ARRIS Group, Inc.(b) | 785,074 | ||||||
42,106 | Aruba Networks, Inc.(b) | 832,436 | ||||||
90,241 | Brocade Communications Systems, Inc.(b) | 840,144 | ||||||
35,149 | Ciena Corp.(b) | 694,896 | ||||||
72,627 | Cisco Systems, Inc. | 1,678,410 | ||||||
35,702 | CommScope Holding Co., Inc.(b) | 952,529 | ||||||
14,095 | F5 Networks, Inc.(b) | 1,482,371 | ||||||
36,440 | Finisar Corp.(b) | 952,906 | ||||||
103,799 | Infinera Corp.(b) | 930,039 | ||||||
59,210 | Juniper Networks, Inc.(b) | 1,461,895 | ||||||
23,917 | Motorola Solutions, Inc. | 1,520,643 | ||||||
25,266 | NETGEAR, Inc.(b) | 816,092 | ||||||
22,253 | Palo Alto Networks, Inc.(b) | 1,414,846 | ||||||
21,029 | QUALCOMM, Inc. | 1,655,192 | ||||||
38,761 | Riverbed Technology, Inc.(b) | 753,901 | ||||||
231,530 | Sonus Networks, Inc.(b) | 757,103 | ||||||
|
| |||||||
18,267,815 | ||||||||
|
| |||||||
Electronic Components—8.8% | ||||||||
17,988 | Amphenol Corp., Class A | 1,715,156 | ||||||
11,973 | Belden, Inc. | 883,727 | ||||||
|
| |||||||
2,598,883 | ||||||||
|
| |||||||
Internet Software & Services—3.2% | ||||||||
20,636 | LogMeIn, Inc.(b) | 937,906 | ||||||
|
| |||||||
Semiconductors—2.9% | ||||||||
20,500 | Cavium, Inc.(b) | 868,585 | ||||||
|
| |||||||
Systems Software—15.0% | ||||||||
24,023 | Barracuda Networks, Inc.(b) | 620,514 | ||||||
27,364 | Gigamon, Inc.(b) | 431,530 | ||||||
37,418 | Infoblox, Inc.(b) | 734,141 | ||||||
20,836 | Proofpoint, Inc.(b) | 530,068 | ||||||
31,856 | Qualys, Inc.(b) | 614,502 | ||||||
16,484 | VMware, Inc., Class A(b) | 1,524,935 | ||||||
|
| |||||||
4,455,690 | ||||||||
|
| |||||||
Technology Hardware, Storage & Peripherals—3.0% | ||||||||
75,622 | QLogic Corp.(b) | 875,703 | ||||||
|
| |||||||
Total Common Stocks (Cost $25,878,033) | 29,644,479 | |||||||
|
| |||||||
Money Market Fund—0.2% | ||||||||
56,702 | Invesco Premier Portfolio—Institutional Class(c) (Cost $56,702) | 56,702 | ||||||
|
| |||||||
Total Investments (Cost $25,934,735)—100.2% | 29,701,181 | |||||||
Other assets less liabilities—(0.2)% | (58,392 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 29,642,789 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 41 |
|
Schedule of Investments(a)
PowerShares Dynamic Oil & Gas Services Portfolio (PXJ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Oil & Gas Drilling—26.0% | ||||||||
73,073 | Atwood Oceanics, Inc.(b) | $ | 3,621,498 | |||||
64,271 | Helmerich & Payne, Inc. | 6,983,044 | ||||||
150,378 | Nabors Industries Ltd. | 3,837,647 | ||||||
429,127 | Parker Drilling Co.(b) | 2,845,112 | ||||||
118,918 | Patterson-UTI Energy, Inc. | 3,868,403 | ||||||
303,667 | Pioneer Energy Services Corp.(b) | 4,545,895 | ||||||
103,809 | Rowan Cos. PLC, Class A(b) | 3,209,774 | ||||||
149,690 | Transocean Ltd. | 6,447,148 | ||||||
|
| |||||||
35,358,521 | ||||||||
|
| |||||||
Oil & Gas Equipment & Services—74.0% | ||||||||
100,299 | Baker Hughes, Inc. | 7,010,900 | ||||||
145,149 | Basic Energy Services, Inc.(b) | 3,834,837 | ||||||
133,919 | C&J Energy Services, Inc.(b) | 4,025,605 | ||||||
99,079 | Cameron International Corp.(b) | 6,436,172 | ||||||
18,408 | Core Laboratories NV | 3,454,813 | ||||||
32,196 | Dril-Quip, Inc.(b) | 3,642,011 | ||||||
84,526 | Exterran Holdings, Inc. | 3,636,308 | ||||||
115,435 | Exterran Partners LP | 3,379,937 | ||||||
72,999 | Gulfmark Offshore, Inc., Class A | 3,285,685 | ||||||
111,350 | Halliburton Co. | 7,022,844 | ||||||
850,640 | ION Geophysical Corp.(b) | 3,742,816 | ||||||
382,931 | Key Energy Services, Inc.(b) | 3,844,627 | ||||||
82,381 | National Oilwell Varco, Inc. | 6,469,380 | ||||||
311,301 | Newpark Resources, Inc.(b) | 3,748,064 | ||||||
48,360 | Oceaneering International, Inc. | 3,543,821 | ||||||
36,484 | Oil States International, Inc.(b) | 3,544,056 | ||||||
188,033 | RPC, Inc. | 4,179,974 | ||||||
68,248 | Schlumberger Ltd. | 6,930,584 | ||||||
39,148 | SEACOR Holdings, Inc.(b) | 3,264,552 | ||||||
116,993 | Superior Energy Services, Inc. | 3,851,410 | ||||||
182,480 | Tesco Corp.(b) | 3,649,600 | ||||||
380,726 | Weatherford International Ltd.(b) | 7,995,246 | ||||||
|
| |||||||
100,493,242 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $115,195,614) | 135,851,763 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
152,457 | Invesco Premier Portfolio—Institutional Class(c) (Cost $152,457) | 152,457 | ||||||
|
| |||||||
Total Investments (Cost $115,348,071)—100.1% | 136,004,220 | |||||||
Other assets less liabilities—(0.1)% | (154,770 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 135,849,450 | ||||||
|
|
Notes | to Schedule of Investments: |
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 42 |
|
Schedule of Investments(a)
PowerShares Dynamic Pharmaceuticals Portfolio (PJP)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Biotechnology—21.2% | ||||||||
458,726 | Amgen, Inc. | $ | 51,262,631 | |||||
166,994 | Biogen Idec, Inc.(b) | 47,947,317 | ||||||
202,239 | Celgene Corp.(b) | 29,731,155 | ||||||
687,168 | Gilead Sciences, Inc.(b) | 53,935,816 | ||||||
466,080 | Ligand Pharmaceuticals, Inc.(b) | 29,442,274 | ||||||
5,079,504 | Novavax, Inc.(b)(c) | 22,248,228 | ||||||
|
| |||||||
234,567,421 | ||||||||
|
| |||||||
Health Care Equipment—6.0% | ||||||||
817,219 | Abbott Laboratories | 31,659,064 | ||||||
467,751 | Baxter International, Inc. | 34,047,595 | ||||||
|
| |||||||
65,706,659 | ||||||||
|
| |||||||
Pharmaceuticals—72.8% | ||||||||
147,232 | Actavis PLC(b)(c) | 30,083,915 | ||||||
1,259,059 | Akorn, Inc.(b) | 31,753,468 | ||||||
255,971 | Allergan, Inc. | 42,450,231 | ||||||
1,057,215 | Auxilium Pharmaceuticals, Inc.(b) | 23,797,910 | ||||||
1,058,040 | Bristol-Myers Squibb Co. | 52,997,224 | ||||||
2,697,823 | Depomed, Inc.(b) | 37,796,500 | ||||||
954,375 | Eli Lilly & Co. | 56,403,562 | ||||||
407,298 | Endo International PLC(b) | 25,637,373 | ||||||
333,191 | Forest Laboratories, Inc.(b) | 30,623,585 | ||||||
751,124 | Hospira, Inc.(b) | 34,401,479 | ||||||
1,261,496 | Impax Laboratories, Inc.(b) | 32,988,120 | ||||||
617,560 | Johnson & Johnson | 62,552,652 | ||||||
757,951 | Lannett Co., Inc.(b) | 26,172,048 | ||||||
1,064,119 | Medicines Co. (The)(b) | 28,305,565 | ||||||
998,261 | Merck & Co., Inc. | 58,458,164 | ||||||
585,020 | Mylan, Inc.(b) | 29,707,316 | ||||||
197,684 | Perrigo Co. PLC | 28,636,504 | ||||||
1,771,734 | Pfizer, Inc. | 55,419,839 | ||||||
1,141,054 | Prestige Brands Holdings, Inc.(b) | 38,248,130 | ||||||
535,115 | Questcor Pharmaceuticals, Inc.(c) | 43,975,751 | ||||||
301,235 | Salix Pharmaceuticals Ltd.(b) | 33,135,850 | ||||||
|
| |||||||
803,545,186 | ||||||||
|
| |||||||
Total Common Stocks (Cost $908,449,972) | 1,103,819,266 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
384,664 | Invesco Premier Portfolio—Institutional Class(d) (Cost $384,664) | 384,664 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $908,834,636)—100.0% | 1,104,203,930 | |||||||
|
| |||||||
Number of Shares | Value | |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—5.3% | ||||||||
57,893,500 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $57,893,500) | $ | 57,893,500 | |||||
|
| |||||||
Total Investments (Cost $966,728,136)—105.3% | 1,162,097,430 | |||||||
Other assets less liabilities—(5.3)% | (58,090,606 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 1,104,006,824 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund's gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Citibank | $ | 57,335,202 | $ | (57,335,202 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 43 |
|
Schedule of Investments(a)
PowerShares Dynamic Retail Portfolio (PMR)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Apparel Retail—8.3% | ||||||||
12,531 | Children's Place Retail Stores, Inc. (The) | $ | 601,488 | |||||
16,274 | Foot Locker, Inc. | 757,229 | ||||||
10,934 | Jos. A. Bank Clothiers, Inc.(b) | 705,790 | ||||||
|
| |||||||
2,064,507 | ||||||||
|
| |||||||
Apparel, Accessories & Luxury Goods—4.7% | ||||||||
12,694 | Michael Kors Holdings Ltd.(b) | 1,157,693 | ||||||
|
| |||||||
Automotive Retail—15.8% | ||||||||
5,330 | Advance Auto Parts, Inc. | 646,475 | ||||||
13,351 | Asbury Automotive Group, Inc.(b) | 824,291 | ||||||
2,311 | AutoZone, Inc.(b) | 1,233,820 | ||||||
8,249 | O'Reilly Automotive, Inc.(b) | 1,227,369 | ||||||
|
| |||||||
3,931,955 | ||||||||
|
| |||||||
Department Stores—7.8% | ||||||||
7,332 | Dillard's, Inc., Class A | 718,023 | ||||||
21,508 | Macy's, Inc. | 1,235,204 | ||||||
|
| |||||||
1,953,227 | ||||||||
|
| |||||||
Drug Retail—13.0% | ||||||||
17,014 | CVS Caremark Corp. | 1,237,258 | ||||||
103,002 | Rite Aid Corp.(b) | 751,914 | ||||||
18,314 | Walgreen Co. | 1,243,521 | ||||||
|
| |||||||
3,232,693 | ||||||||
|
| |||||||
Food Distributors—2.6% | ||||||||
30,048 | Spartan Stores, Inc. | 647,234 | ||||||
|
| |||||||
Food Retail—23.6% | ||||||||
20,262 | Fresh Market, Inc. (The)(b) | 751,720 | ||||||
29,672 | Kroger Co. (The) | 1,366,099 | ||||||
20,245 | Safeway, Inc. | 689,545 | ||||||
17,396 | Sprouts Farmers Market, Inc.(b) | 556,150 | ||||||
104,912 | SUPERVALU, Inc.(b) | 733,335 | ||||||
13,457 | Weis Markets, Inc. | 620,233 | ||||||
23,024 | Whole Foods Market, Inc. | 1,144,293 | ||||||
|
| |||||||
5,861,375 | ||||||||
|
| |||||||
Forest Products—2.3% | ||||||||
22,940 | Boise Cascade Co.(b) | 573,959 | ||||||
|
| |||||||
Homefurnishing Retail—2.6% | ||||||||
22,089 | Aaron's, Inc. | 650,963 | ||||||
|
| |||||||
Hypermarkets & Super Centers—2.6% | ||||||||
6,672 | PriceSmart, Inc. | 640,779 | ||||||
|
| |||||||
Specialized Consumer Services—2.4% | ||||||||
14,439 | Sotheby's | 607,304 | ||||||
|
| |||||||
Specialty Stores—8.3% | ||||||||
9,597 | Outerwall, Inc.(b) | 665,552 | ||||||
7,104 | Signet Jewelers Ltd. | 719,777 | ||||||
31,237 | Zale Corp.(b) | 668,159 | ||||||
|
| |||||||
2,053,488 | ||||||||
|
| |||||||
Trucking—6.0% | ||||||||
2,914 | AMERCO | 728,820 | ||||||
14,445 | Avis Budget Group, Inc.(b) | 759,663 | ||||||
|
| |||||||
1,488,483 | ||||||||
|
| |||||||
Total Common Stocks (Cost $24,897,332) | 24,863,660 | |||||||
|
| |||||||
Number of Shares | Value | |||||||
Money Market Fund—0.2% | ||||||||
47,800 | Invesco Premier Portfolio—Institutional Class(c) (Cost $47,800) | $ | 47,800 | |||||
|
| |||||||
Total Investments (Cost $24,945,132)—100.2% | 24,911,460 | |||||||
Other assets less liabilities—(0.2)% | (47,900 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 24,863,560 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 44 |
|
Schedule of Investments(a)
PowerShares Dynamic Semiconductors Portfolio (PSI)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Communications Equipment—5.1% | ||||||||
13,284 | QUALCOMM, Inc. | $ | 1,045,584 | |||||
|
| |||||||
Semiconductor Equipment—29.7% | ||||||||
19,882 | Advanced Energy Industries, Inc.(b) | 435,018 | ||||||
92,149 | Amkor Technology, Inc.(b) | 732,585 | ||||||
52,750 | Applied Materials, Inc. | 1,005,415 | ||||||
52,607 | Brooks Automation, Inc. | 538,170 | ||||||
45,272 | Entegris, Inc.(b) | 502,066 | ||||||
38,069 | GT Advanced Technologies, Inc.(b) | 632,326 | ||||||
15,350 | KLA-Tencor Corp. | 982,246 | ||||||
47,273 | Kulicke & Soffa Industries, Inc. (Singapore)(b) | 695,386 | ||||||
10,546 | Lam Research Corp.(b) | 607,555 | ||||||
|
| |||||||
6,130,767 | ||||||||
|
| |||||||
Semiconductors—65.2% | ||||||||
147,041 | Advanced Micro Devices, Inc.(b) | 601,398 | ||||||
16,308 | Ambarella Inc.(b) | 405,254 | ||||||
28,340 | Cirrus Logic, Inc.(b) | 631,982 | ||||||
46,271 | Integrated Device Technology, Inc.(b) | 539,982 | ||||||
40,393 | Intel Corp. | 1,078,089 | ||||||
20,243 | International Rectifier Corp.(b) | 527,128 | ||||||
42,887 | Intersil Corp., Class A | 529,226 | ||||||
72,064 | Lattice Semiconductor Corp.(b) | 606,779 | ||||||
21,351 | Linear Technology Corp. | 950,119 | ||||||
49,191 | LSI Corp. | 547,988 | ||||||
35,678 | Marvell Technology Group Ltd. | 565,853 | ||||||
11,978 | Microchip Technology, Inc. | 569,434 | ||||||
41,345 | Micron Technology, Inc.(b) | 1,079,931 | ||||||
23,658 | Microsemi Corp.(b) | 556,436 | ||||||
29,681 | NVIDIA Corp. | 548,208 | ||||||
31,588 | OmniVision Technologies, Inc.(b) | 616,914 | ||||||
58,408 | ON Semiconductor Corp.(b) | 549,619 | ||||||
15,385 | Skyworks Solutions, Inc.(b) | 631,554 | ||||||
22,245 | Texas Instruments, Inc. | 1,011,035 | ||||||
19,161 | Xilinx, Inc. | 904,208 | ||||||
|
| |||||||
13,451,137 | ||||||||
|
| |||||||
Total Common Stocks (Cost $18,237,567) | 20,627,488 | |||||||
|
| |||||||
Money Market Fund—0.2% | ||||||||
37,623 | Invesco Premier Portfolio—Institutional Class(c) (Cost $37,623) | 37,623 | ||||||
|
| |||||||
Total Investments (Cost $18,275,190)—100.2% | 20,665,111 | |||||||
Other assets less liabilities—(0.2)% | (44,119 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 20,620,992 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 45 |
|
Schedule of Investments(a)
PowerShares Dynamic Software Portfolio (PSJ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Application Software—39.7% | ||||||||
34,857 | Aspen Technology, Inc.(b) | $ | 1,498,502 | |||||
57,192 | Autodesk, Inc.(b) | 2,746,360 | ||||||
47,283 | Comverse, Inc.(b) | 1,179,238 | ||||||
38,390 | Intuit, Inc. | 2,908,042 | ||||||
43,190 | Manhattan Associates, Inc.(b) | 1,361,781 | ||||||
43,088 | Netscout Systems, Inc.(b) | 1,678,708 | ||||||
78,622 | Pegasystems, Inc. | 1,302,767 | ||||||
47,502 | PROS Holdings, Inc.(b) | 1,301,555 | ||||||
41,630 | PTC, Inc.(b) | 1,472,453 | ||||||
32,347 | Splunk, Inc.(b) | 1,765,176 | ||||||
42,309 | SS&C Technologies Holdings, Inc.(b) | 1,646,666 | ||||||
40,507 | Synopsys, Inc.(b) | 1,523,873 | ||||||
9,858 | Ultimate Software Group, Inc. (The)(b) | 1,179,313 | ||||||
|
| |||||||
21,564,434 | ||||||||
|
| |||||||
Communications Equipment—2.6% | ||||||||
73,450 | Riverbed Technology, Inc.(b) | 1,428,603 | ||||||
|
| |||||||
Data Processing & Outsourced Services—8.6% | ||||||||
58,445 | CSG Systems International, Inc. | 1,540,610 | ||||||
17,413 | DST Systems, Inc. | 1,605,305 | ||||||
28,152 | Jack Henry & Associates, Inc. | 1,552,864 | ||||||
|
| |||||||
4,698,779 | ||||||||
|
| |||||||
Health Care Technology—7.4% | ||||||||
48,887 | Cerner Corp.(b) | 2,507,903 | ||||||
23,916 | Computer Programs & Systems, Inc. | 1,509,817 | ||||||
|
| |||||||
4,017,720 | ||||||||
|
| |||||||
Home Entertainment Software—14.3% | ||||||||
155,050 | Activision Blizzard, Inc. | 3,102,551 | ||||||
104,940 | Electronic Arts, Inc.(b) | 2,969,802 | ||||||
82,777 | Take-Two Interactive Software, Inc.(b) | 1,686,995 | ||||||
|
| |||||||
7,759,348 | ||||||||
|
| |||||||
Internet Software & Services—10.6% | ||||||||
59,358 | Constant Contact, Inc.(b) | 1,534,998 | ||||||
30,266 | Dealertrack Technologies, Inc.(b) | 1,382,854 | ||||||
21,788 | Demandware, Inc.(b) | 1,081,338 | ||||||
39,103 | LogMeIn, Inc.(b) | 1,777,231 | ||||||
|
| |||||||
5,776,421 | ||||||||
|
| |||||||
IT Consulting & Other Services—3.2% | ||||||||
36,791 | Amdocs Ltd. | 1,711,885 | ||||||
|
| |||||||
Systems Software—13.6% | ||||||||
89,559 | CA, Inc. | 2,699,308 | ||||||
29,482 | MICROS Systems, Inc.(b) | 1,518,323 | ||||||
78,316 | Microsoft Corp. | 3,163,967 | ||||||
|
| |||||||
7,381,598 | ||||||||
|
| |||||||
Total Common Stocks (Cost $55,225,112) | 54,338,788 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
42,420 | Invesco Premier Portfolio—Institutional Class(c) (Cost $42,420) | 42,420 | ||||||
|
| |||||||
Total Investments (Cost $55,267,532)—100.1% | 54,381,208 | |||||||
Other assets less liabilities—(0.1)% | (45,918 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 54,335,290 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 46 |
|
(This Page Intentionally Left Blank)
Statements of Assets and Liabilities
April 30, 2014
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) | PowerShares Dynamic Building & Construction Portfolio (PKB) | PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) | PowerShares Dynamic Food & Beverage Portfolio (PBJ) | PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ) | ||||||||||||||||
Assets: | ||||||||||||||||||||
Unaffiliated investments, at value(a) | $ | 361,282,152 | $ | 123,687,021 | $ | 130,318,313 | $ | 434,315,406 | $ | 178,070,692 | ||||||||||
Affiliated investments, at value | 38,589,095 | 85,769 | 53,397 | 17,269 | 14,105 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total investments, at value | 399,871,247 | 123,772,790 | 130,371,710 | 434,332,675 | 178,084,797 | |||||||||||||||
Receivables: | ||||||||||||||||||||
Shares sold | 3,860,934 | — | 3,761,291 | — | — | |||||||||||||||
Security lending | 183,594 | — | — | — | — | |||||||||||||||
Dividends | 3 | 34,159 | 19,765 | 341,753 | 7,722 | |||||||||||||||
Investments sold | — | — | — | — | — | |||||||||||||||
Other assets | 3,330 | 3,333 | 3,333 | 3,330 | 3,333 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Assets | 403,919,108 | 123,810,282 | 134,156,099 | 434,677,758 | 178,095,852 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Liabilities: | ||||||||||||||||||||
Due to custodian | — | — | — | — | — | |||||||||||||||
Payables: | ||||||||||||||||||||
Collateral upon return of securities loaned | 38,432,742 | — | — | — | — | |||||||||||||||
Investments purchased | 3,860,807 | — | 3,760,967 | — | — | |||||||||||||||
Expenses recaptured | 8 | 269 | 1,029 | 236 | — | |||||||||||||||
Shares repurchased | — | — | — | — | — | |||||||||||||||
Accrued advisory fees | 151,453 | 51,420 | 48,553 | 177,820 | 69,001 | |||||||||||||||
Accrued trustees’ and officer’s fees | 20,806 | 12,986 | 15,003 | 17,623 | 13,384 | |||||||||||||||
Accrued expenses | 133,582 | 57,599 | 57,649 | 110,729 | 83,661 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Liabilities | 42,599,398 | 122,274 | 3,883,201 | 306,408 | 166,046 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Assets | $ | 361,319,710 | $ | 123,688,008 | $ | 130,272,898 | $ | 434,371,350 | $ | 177,929,806 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Assets Consist of: | ||||||||||||||||||||
Shares of beneficial interest | $ | 505,029,446 | $ | 135,385,959 | $ | 164,120,713 | $ | 455,031,119 | $ | 190,301,885 | ||||||||||
Undistributed net investment income (loss) | 100,216 | (42,142 | ) | 565,347 | 2,361,597 | 94,984 | ||||||||||||||
Undistributed net realized gain (loss) | (162,277,831 | ) | (18,827,120 | ) | (50,056,402 | ) | (39,849,191 | ) | (12,849,987 | ) | ||||||||||
Net unrealized appreciation (depreciation) | 18,467,879 | 7,171,311 | 15,643,240 | 16,827,825 | 382,924 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Assets | $ | 361,319,710 | $ | 123,688,008 | $ | 130,272,898 | $ | 434,371,350 | $ | 177,929,806 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 9,100,000 | 5,600,000 | 3,450,000 | 16,100,000 | 5,500,000 | |||||||||||||||
Net asset value | $ | 39.71 | $ | 22.09 | $ | 37.76 | $ | 26.98 | $ | 32.35 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Market price | $ | 39.68 | $ | 22.10 | $ | 37.76 | $ | 26.99 | $ | 32.34 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Unaffiliated investments, at cost | $ | 342,814,273 | $ | 116,515,710 | $ | 114,675,073 | $ | 417,487,581 | $ | 177,687,768 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Affiliated investments, at cost | $ | 38,589,095 | $ | 85,769 | $ | 53,397 | $ | 17,269 | $ | 14,105 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total investments, at cost | $ | 381,403,368 | $ | 116,601,479 | $ | 114,728,470 | $ | 417,504,850 | $ | 177,701,873 | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
(a) Includes securities on loan with an aggregate value of | $ | 38,022,906 | $ | — | $ | — | $ | — | $ | — | ||||||||||
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 48 |
|
PowerShares Dynamic Media Portfolio (PBS) | PowerShares Dynamic Networking Portfolio (PXQ) | PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) | PowerShares Dynamic Pharmaceuticals Portfolio (PJP) | PowerShares Dynamic Retail Portfolio (PMR) | PowerShares Dynamic Semiconductors Portfolio (PSI) | PowerShares Dynamic Software Portfolio (PSJ) | ||||||||||||||||||||
$ | 171,494,293 | $ | 29,644,479 | $ | 135,851,763 | $ | 1,103,819,266 | $ | 24,863,660 | $ | 20,627,488 | $ | 54,338,788 | |||||||||||||
104,364 | 56,702 | 152,457 | 58,278,164 | 47,800 | 37,623 | 42,420 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
171,598,657 | 29,701,181 | 136,004,220 | 1,162,097,430 | 24,911,460 | 20,665,111 | 54,381,208 | ||||||||||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
— | — | — | 22,758 | — | — | — | ||||||||||||||||||||
34,991 | 2,967 | 17,266 | 588,637 | 9,979 | 6,674 | 31,980 | ||||||||||||||||||||
9,440,534 | — | — | 5,685,757 | — | — | — | ||||||||||||||||||||
3,333 | 3,333 | 3,330 | 3,333 | 3,333 | 3,333 | 3,333 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
181,077,515 | 29,707,481 | 136,024,816 | 1,168,397,915 | 24,924,772 | 20,675,118 | 54,416,521 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
— | — | 38,415 | — | — | — | — | ||||||||||||||||||||
— | — | — | 57,893,500 | — | — | — | ||||||||||||||||||||
— | — | — | — | — | — | — | ||||||||||||||||||||
230 | — | 2 | — | — | — | — | ||||||||||||||||||||
9,440,687 | — | — | 5,693,035 | — | — | — | ||||||||||||||||||||
82,612 | 8,740 | 54,790 | 451,273 | 6,801 | 2,108 | 20,966 | ||||||||||||||||||||
15,860 | 12,425 | 20,774 | 25,409 | 11,704 | 12,178 | 12,820 | ||||||||||||||||||||
108,418 | 43,527 | 61,385 | 327,874 | 42,707 | 39,840 | 47,445 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
9,647,807 | 64,692 | 175,366 | 64,391,091 | 61,212 | 54,126 | 81,231 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 171,429,708 | $ | 29,642,789 | $ | 135,849,450 | $ | 1,104,006,824 | $ | 24,863,560 | $ | 20,620,992 | $ | 54,335,290 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 226,081,682 | $ | 61,208,649 | $ | 317,450,766 | $ | 914,427,185 | $ | 43,993,179 | $ | 72,440,999 | $ | 77,997,730 | |||||||||||||
103,996 | (22,986 | ) | 206,370 | 1,479,285 | 94,766 | 27,239 | (31,202 | ) | ||||||||||||||||||
(48,972,133 | ) | (35,309,320 | ) | (202,463,835 | ) | (7,268,940 | ) | (19,190,713 | ) | (54,237,167 | ) | (22,744,914 | ) | |||||||||||||
(5,783,837 | ) | 3,766,446 | 20,656,149 | 195,369,294 | (33,672 | ) | 2,389,921 | (886,324 | ) | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 171,429,708 | $ | 29,642,789 | $ | 135,849,450 | $ | 1,104,006,824 | $ | 24,863,560 | $ | 20,620,992 | $ | 54,335,290 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
7,200,000 | 950,000 | 4,850,000 | 19,150,000 | 750,000 | 1,000,000 | 1,600,000 | ||||||||||||||||||||
$ | 23.81 | $ | 31.20 | $ | 28.01 | $ | 57.65 | $ | 33.15 | $ | 20.62 | $ | 33.96 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 23.79 | $ | 31.19 | $ | 28.00 | $ | 57.60 | $ | 33.14 | $ | 20.62 | $ | 33.93 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 177,278,130 | $ | 25,878,033 | $ | 115,195,614 | $ | 908,449,972 | $ | 24,897,332 | $ | 18,237,567 | $ | 55,225,112 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 104,364 | $ | 56,702 | $ | 152,457 | $ | 58,278,164 | $ | 47,800 | $ | 37,623 | $ | 42,420 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 177,382,494 | $ | 25,934,735 | $ | 115,348,071 | $ | 966,728,136 | $ | 24,945,132 | $ | 18,275,190 | $ | 55,267,532 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | — | $ | — | $ | — | $ | 57,335,202 | $ | — | $ | — | $ | — | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 49 |
|
For the year ended April 30, 2014
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) | PowerShares Dynamic Building & Construction Portfolio (PKB) | PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) | PowerShares Dynamic Food & Beverage Portfolio (PBJ) | PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ) | ||||||||||||||||
Investment Income: | ||||||||||||||||||||
Unaffiliated dividend income | $ | 957,330 | $ | 670,460 | $ | 2,223,133 | $ | 5,859,649 | $ | 1,754,661 | ||||||||||
Affiliated income money market | 22 | 16 | 16 | 24 | 13 | |||||||||||||||
Securities lending income | 885,463 | — | — | — | — | |||||||||||||||
Foreign withholding tax | — | — | — | — | (1,363 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Income | 1,842,815 | 670,476 | 2,223,149 | 5,859,673 | 1,753,311 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Expenses: | ||||||||||||||||||||
Advisory fees | 1,343,663 | 523,017 | 529,009 | 1,405,861 | 787,937 | |||||||||||||||
Sub-licensing | 80,620 | 31,381 | 31,740 | 84,352 | 47,276 | |||||||||||||||
Accounting & administration fees | 54,518 | 36,058 | 36,058 | 54,855 | 37,183 | |||||||||||||||
Professional fees | 27,439 | 27,166 | 30,127 | 28,895 | 30,721 | |||||||||||||||
Recapture (Note 3) | 17,548 | 3,627 | 751 | 86,186 | 33,153 | |||||||||||||||
Trustees’ and officer’s fees | 14,836 | 11,549 | 11,632 | 15,995 | 12,441 | |||||||||||||||
Custodian & transfer agent fees | 4,827 | 2,796 | 3,674 | 5,173 | 4,434 | |||||||||||||||
Other expenses | 55,445 | 23,423 | 31,496 | 47,505 | 39,627 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total Expenses | 1,598,896 | 659,017 | 674,487 | 1,728,822 | 992,772 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Waivers | (140 | ) | (97 | ) | (110 | ) | (159 | ) | (91 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Expenses | 1,598,756 | 658,920 | 674,377 | 1,728,663 | 992,681 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net Investment Income (Loss) | 244,059 | 11,556 | 1,548,772 | 4,131,010 | 760,630 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Realized and Unrealized Gain (Loss): | ||||||||||||||||||||
Net realized gain (loss) from: | ||||||||||||||||||||
Investment securities | 2,190,355 | (319,533 | ) | (4,879,355 | ) | 6,006,456 | 6,260,496 | |||||||||||||
In-kind redemptions | 85,786,916 | 15,688,456 | 24,045,655 | 30,850,075 | 26,308,855 | |||||||||||||||
Net increase from payment by affiliate | — | — | — | — | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net realized gain | 87,977,271 | 15,368,923 | 19,166,300 | 36,856,531 | 32,569,351 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net change in unrealized appreciation (depreciation) on investment securities | (20,969,168 | ) | (5,474,689 | ) | 4,474,440 | (2,492,106 | ) | (13,361,430 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net realized and unrealized gain | 67,008,103 | 9,894,234 | 23,640,740 | 34,364,425 | 19,207,921 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net increase in net assets resulting from operations | $ | 67,252,162 | $ | 9,905,790 | $ | 25,189,512 | $ | 38,495,435 | $ | 19,968,551 | ||||||||||
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 50 |
|
PowerShares Dynamic Media Portfolio (PBS) | PowerShares Dynamic Networking Portfolio (PXQ) | PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) | PowerShares Dynamic Pharmaceuticals Portfolio (PJP) | PowerShares Dynamic Retail Portfolio (PMR) | PowerShares Dynamic Semiconductors Portfolio (PSI) | PowerShares Dynamic Software Portfolio (PSJ) | ||||||||||||||||||||
$ | 2,464,647 | $ | 162,230 | $ | 1,123,454 | $ | 8,685,113 | $ | 508,813 | $ | 194,619 | $ | 339,269 | |||||||||||||
22 | 12 | 17 | 59 | 10 | 10 | 19 | ||||||||||||||||||||
25,649 | — | — | 188,664 | — | — | — | ||||||||||||||||||||
(4,068 | ) | — | (5,647 | ) | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
2,486,250 | 162,242 | 1,117,824 | 8,873,836 | 508,823 | 194,629 | 339,288 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
1,236,447 | 158,719 | 603,621 | 4,058,764 | 160,007 | 82,715 | 274,804 | ||||||||||||||||||||
74,187 | 9,523 | 36,217 | 243,526 | 9,599 | 4,963 | 16,488 | ||||||||||||||||||||
51,804 | 36,058 | 36,058 | 161,559 | 36,058 | 36,058 | 36,058 | ||||||||||||||||||||
27,766 | 26,017 | 26,078 | 35,775 | 24,392 | 24,676 | 25,182 | ||||||||||||||||||||
89,828 | — | 118 | 18,411 | — | — | — | ||||||||||||||||||||
15,054 | 9,399 | 11,912 | 28,409 | 9,403 | 9,029 | 10,063 | ||||||||||||||||||||
4,746 | 3,555 | 4,061 | 7,454 | 2,492 | 2,484 | 2,203 | ||||||||||||||||||||
39,185 | 15,620 | 23,026 | 120,599 | 12,091 | 13,499 | 16,264 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
1,539,017 | 258,891 | 741,091 | 4,674,497 | 254,042 | 173,424 | 381,062 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
(141 | ) | (58,971 | ) | (110 | ) | (408 | ) | (52,899 | ) | (69,257 | ) | (34,897 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
1,538,876 | 199,920 | 740,981 | 4,674,089 | 201,143 | 104,167 | 346,165 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
947,374 | (37,678 | ) | 376,843 | 4,199,747 | 307,680 | 90,462 | (6,877 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
(5,690,425 | ) | (2,329,271 | ) | (7,924,363 | ) | 20,479,123 | (1,513,014 | ) | (344,266 | ) | 2,261,446 | |||||||||||||||
70,300,592 | 5,932,428 | 10,557,023 | 125,141,652 | 7,904,180 | 4,420,319 | 12,749,963 | ||||||||||||||||||||
— | — | 2,071,089 | — | — | — | — | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
64,610,167 | 3,603,157 | 4,703,749 | 145,620,775 | 6,391,166 | 4,076,053 | 15,011,409 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
(27,651,727 | ) | 3,901,364 | 22,095,104 | 109,005,911 | (3,531,138 | ) | 1,207,489 | (8,514,120 | ) | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
36,958,440 | 7,504,521 | 26,798,853 | 254,626,686 | 2,860,028 | 5,283,542 | 6,497,289 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 37,905,814 | $ | 7,466,843 | $ | 27,175,696 | $ | 258,826,433 | $ | 3,167,708 | $ | 5,374,004 | $ | 6,490,412 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 51 |
|
Statements of Changes in Net Assets
For the years ended April 30, 2014 and 2013
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) | PowerShares Dynamic Building & Construction Portfolio (PKB) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income (loss) | $ | 244,059 | $ | (265,369 | ) | $ | 11,556 | $ | 241,987 | |||||||
Net realized gain | 87,977,271 | 12,127,152 | 15,368,923 | 8,903,971 | ||||||||||||
Net change in unrealized appreciation (depreciation) | (20,969,168 | ) | 21,227,732 | (5,474,689 | ) | 8,901,943 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from operations | 67,252,162 | 33,089,515 | 9,905,790 | 18,047,901 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | — | — | — | (322,061 | ) | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 370,953,512 | 79,409,291 | 98,038,267 | 117,839,052 | ||||||||||||
Value of shares repurchased | (232,339,347 | ) | (93,948,251 | ) | (88,376,874 | ) | (62,044,425 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | 138,614,165 | (14,538,960 | ) | 9,661,393 | 55,794,627 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Increase in Net Assets | 205,866,327 | 18,550,555 | 19,567,183 | 73,520,467 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 155,453,383 | 136,902,828 | 104,120,825 | 30,600,358 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
End of year | $ | 361,319,710 | $ | 155,453,383 | $ | 123,688,008 | $ | 104,120,825 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Undistributed net investment income (loss) at end of year | $ | 100,216 | $ | (143,843 | ) | $ | (42,142 | ) | $ | (72,549 | ) | |||||
|
|
|
|
|
|
|
| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 9,650,000 | 3,450,000 | 4,600,000 | 6,850,000 | ||||||||||||
Shares repurchased | (6,050,000 | ) | (4,100,000 | ) | (4,300,000 | ) | (3,700,000 | ) | ||||||||
Shares outstanding, beginning of year | 5,500,000 | 6,150,000 | 5,300,000 | 2,150,000 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding, end of year | 9,100,000 | 5,500,000 | 5,600,000 | 5,300,000 | ||||||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 52 |
|
PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) | PowerShares Dynamic Food & Beverage Portfolio (PBJ) | PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ) | PowerShares Dynamic Media Portfolio (PBS) | |||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
$ | 1,548,772 | $ | 1,477,559 | $ | 4,131,010 | $ | 1,693,886 | $ | 760,630 | $ | 321,637 | $ | 947,374 | $ | 881,044 | |||||||||||||||
19,166,300 | 2,451,491 | 36,856,531 | 9,879,651 | 32,569,351 | 7,601,493 | 64,610,167 | 22,114,907 | |||||||||||||||||||||||
4,474,440 | 11,077,590 | (2,492,106 | ) | 12,783,411 | (13,361,430 | ) | 5,981,019 | (27,651,727 | ) | 11,226,828 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
25,189,512 | 15,006,640 | 38,495,435 | 24,356,948 | 19,968,551 | 13,904,149 | 37,905,814 | 34,222,779 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
(1,698,221 | ) | (1,748,096 | ) | (1,980,743 | ) | (1,927,726 | ) | (649,713 | ) | (444,843 | ) | (902,729 | ) | (917,905 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
188,944,898 | 85,567,201 | 418,924,441 | 213,982,354 | 250,556,813 | 98,219,830 | 437,394,072 | 167,843,900 | |||||||||||||||||||||||
(186,590,268 | ) | (61,990,794 | ) | (257,294,105 | ) | (169,224,165 | ) | (177,711,187 | ) | (83,592,336 | ) | (453,755,849 | ) | (188,335,046 | ) | |||||||||||||||
|
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|
|
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|
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|
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| |||||||||||||||
2,354,630 | 23,576,407 | 161,630,336 | 44,758,189 | 72,845,626 | 14,627,494 | (16,361,777 | ) | (20,491,146 | ) | |||||||||||||||||||||
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| |||||||||||||||
25,845,921 | 36,834,951 | 198,145,028 | 67,187,411 | 92,164,464 | 28,086,800 | 20,641,308 | 12,813,728 | |||||||||||||||||||||||
|
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|
|
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| |||||||||||||||
104,426,977 | 67,592,026 | 236,226,322 | 169,038,911 | 85,765,342 | 57,678,542 | 150,788,400 | 137,974,672 | |||||||||||||||||||||||
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| |||||||||||||||
$ | 130,272,898 | $ | 104,426,977 | $ | 434,371,350 | $ | 236,226,322 | $ | 177,929,806 | $ | 85,765,342 | $ | 171,429,708 | $ | 150,788,400 | |||||||||||||||
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| |||||||||||||||
$ | 565,347 | $ | 264,270 | $ | 2,361,597 | $ | 211,330 | $ | 94,984 | $ | (7,801 | ) | $ | 103,996 | $ | 59,351 | ||||||||||||||
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| |||||||||||||||
5,850,000 | 3,000,000 | 16,150,000 | 9,800,000 | 7,900,000 | 4,300,000 | 18,700,000 | 9,950,000 | |||||||||||||||||||||||
(5,850,000 | ) | (2,300,000 | ) | (10,050,000 | ) | (8,350,000 | ) | (5,550,000 | ) | (3,750,000 | ) | (19,000,000 | ) | (11,750,000 | ) | |||||||||||||||
3,450,000 | 2,750,000 | 10,000,000 | 8,550,000 | 3,150,000 | 2,600,000 | 7,500,000 | 9,300,000 | |||||||||||||||||||||||
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| |||||||||||||||
3,450,000 | 3,450,000 | 16,100,000 | 10,000,000 | 5,500,000 | 3,150,000 | 7,200,000 | 7,500,000 | |||||||||||||||||||||||
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| 53 |
|
Statements of Changes in Net Assets (continued)
For the years ended April 30, 2014 and 2013
PowerShares Dynamic Networking Portfolio (PXQ) | PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income (loss) | $ | (37,678 | ) | $ | 385,175 | $ | 376,843 | $ | 228,116 | |||||||
Net realized gain (loss) | 3,603,157 | (7,027,151 | ) | 4,703,749 | (6,085,786 | ) | ||||||||||
Net change in unrealized appreciation (depreciation) | 3,901,364 | (2,041,654 | ) | 22,095,104 | 14,972,383 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from operations | 7,466,843 | (8,683,630 | ) | 27,175,696 | 9,114,713 | |||||||||||
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|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (230,610 | ) | (93,171 | ) | (414,523 | ) | (143,856 | ) | ||||||||
|
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|
|
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|
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| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 15,967,749 | 11,278,766 | 89,598,341 | 149,307,907 | ||||||||||||
Value of shares repurchased | (23,560,809 | ) | (54,241,007 | ) | (97,482,772 | ) | (188,790,791 | ) | ||||||||
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|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | (7,593,060 | ) | (42,962,241 | ) | (7,884,431 | ) | (39,482,884 | ) | ||||||||
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|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | (356,827 | ) | (51,739,042 | ) | 18,876,742 | (30,512,027 | ) | |||||||||
|
|
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|
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|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 29,999,616 | 81,738,658 | 116,972,708 | 147,484,735 | ||||||||||||
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| |||||||||
End of year | $ | 29,642,789 | $ | 29,999,616 | $ | 135,849,450 | $ | 116,972,708 | ||||||||
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| |||||||||
Undistributed net investment income (loss) at end of year | $ | (22,986 | ) | $ | 222,354 | $ | 206,370 | $ | 71,156 | |||||||
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| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 550,000 | 450,000 | 3,650,000 | 7,200,000 | ||||||||||||
Shares repurchased | (800,000 | ) | (2,200,000 | ) | (4,000,000 | ) | (9,200,000 | ) | ||||||||
Shares outstanding, beginning of year | 1,200,000 | 2,950,000 | 5,200,000 | 7,200,000 | ||||||||||||
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| |||||||||
Shares outstanding, end of year | 950,000 | 1,200,000 | 4,850,000 | 5,200,000 | ||||||||||||
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See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 54 |
|
PowerShares Dynamic Pharmaceuticals Portfolio (PJP) | PowerShares Dynamic Retail Portfolio (PMR) | PowerShares Dynamic Semiconductors Portfolio (PSI) | PowerShares Dynamic Software Portfolio (PSJ) | |||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
$ | 4,199,747 | $ | 5,001,201 | $ | 307,680 | $ | 1,272,606 | $ | 90,462 | $ | 135,816 | $ | (6,877 | ) | $ | (12,345 | ) | |||||||||||||
145,620,775 | 24,761,162 | 6,391,166 | 3,492,860 | 4,076,053 | (742,479 | ) | 15,011,409 | 2,492,754 | ||||||||||||||||||||||
109,005,911 | 57,938,799 | (3,531,138 | ) | (2,243,383 | ) | 1,207,489 | (64,085 | ) | (8,514,120 | ) | 2,706,450 | |||||||||||||||||||
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258,826,433 | 87,701,162 | 3,167,708 | 2,522,083 | 5,374,004 | (670,748 | ) | 6,490,412 | 5,186,859 | ||||||||||||||||||||||
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(3,255,531 | ) | (4,861,110 | ) | (250,815 | ) | (1,304,529 | ) | (107,690 | ) | (140,761 | ) | — | — | |||||||||||||||||
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| |||||||||||||||
645,323,430 | 215,166,666 | 52,577,848 | 63,080,768 | 20,754,635 | 10,919,661 | 50,413,954 | 36,626,496 | |||||||||||||||||||||||
(265,192,841 | ) | (100,086,731 | ) | (55,381,501 | ) | (116,191,131 | ) | (22,144,327 | ) | (14,625,193 | ) | (50,826,283 | ) | (43,265,846 | ) | |||||||||||||||
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380,130,589 | 115,079,935 | (2,803,653 | ) | (53,110,363 | ) | (1,389,692 | ) | (3,705,532 | ) | (412,329 | ) | (6,639,350 | ) | |||||||||||||||||
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| |||||||||||||||
635,701,491 | 197,919,987 | 113,240 | (51,892,809 | ) | 3,876,622 | (4,517,041 | ) | 6,078,083 | (1,452,491 | ) | ||||||||||||||||||||
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| |||||||||||||||
468,305,333 | 270,385,346 | 24,750,320 | 76,643,129 | 16,744,370 | 21,261,411 | 48,257,207 | 49,709,698 | |||||||||||||||||||||||
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$ | 1,104,006,824 | $ | 468,305,333 | $ | 24,863,560 | $ | 24,750,320 | $ | 20,620,992 | $ | 16,744,370 | $ | 54,335,290 | $ | 48,257,207 | |||||||||||||||
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| |||||||||||||||
$ | 1,479,285 | $ | 535,069 | $ | 94,766 | $ | 37,901 | $ | 27,239 | $ | 44,467 | $ | (31,202 | ) | $ | (8,388 | ) | |||||||||||||
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| |||||||||||||||
12,600,000 | 6,050,000 | 1,600,000 | 2,500,000 | 1,150,000 | 750,000 | 1,500,000 | 1,350,000 | |||||||||||||||||||||||
(4,950,000 | ) | (3,000,000 | ) | (1,700,000 | ) | (4,600,000 | ) | (1,250,000 | ) | (1,000,000 | ) | (1,500,000 | ) | (1,600,000 | ) | |||||||||||||||
11,500,000 | 8,450,000 | 850,000 | 2,950,000 | 1,100,000 | 1,350,000 | 1,600,000 | 1,850,000 | |||||||||||||||||||||||
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19,150,000 | 11,500,000 | 750,000 | 850,000 | 1,000,000 | 1,100,000 | 1,600,000 | 1,600,000 | |||||||||||||||||||||||
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| 55 |
|
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 28.26 | $ | 22.26 | $ | 23.14 | $ | 19.67 | $ | 12.90 | ||||||||||
Net investment income (loss)(a) | 0.03 | (0.05 | ) | (0.04 | ) | (0.05 | ) | 0.06 | (b) | |||||||||||
Net realized and unrealized gain (loss) on investments | 11.42 | 6.05 | (0.84 | ) | 3.52 | 6.79 | ||||||||||||||
Total from investment operations | 11.45 | 6.00 | (0.88 | ) | 3.47 | 6.85 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | — | — | — | — | (0.06 | ) | ||||||||||||||
Return of capital | — | — | — | — | (0.02 | ) | ||||||||||||||
Total distributions | — | — | — | — | (0.08 | ) | ||||||||||||||
Net asset value at end of year | $ | 39.71 | $ | 28.26 | $ | 22.26 | $ | 23.14 | $ | 19.67 | ||||||||||
Market price at end of year(c) | $ | 39.68 | $ | 28.27 | $ | 22.21 | $ | 23.18 | $ | 19.68 | ||||||||||
Net Asset Value Total Return:(d) | 40.52 | % | 26.96 | % | (3.80 | )% | 17.64 | % | 53.19 | % | ||||||||||
Market Price Total Return(d) | 40.36 | % | 27.29 | % | (4.18 | )% | 17.78 | % | 53.63 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 361,320 | $ | 155,453 | $ | 136,903 | $ | 217,553 | $ | 214,391 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.59 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.59 | % | 0.63 | % | 0.64 | % | 0.65 | % | 0.61 | % | ||||||||||
Net investment income (loss), after Waivers | 0.09 | % | (0.20 | )% | (0.21 | )% | (0.23 | )% | 0.36 | %(b) | ||||||||||
Portfolio turnover rate(e) | 64 | % | 53 | % | 53 | % | 81 | % | 80 | % |
PowerShares Dynamic Building & Construction Portfolio (PKB)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 19.65 | $ | 14.23 | $ | 14.11 | $ | 13.92 | $ | 10.92 | ||||||||||
Net investment income(a) | 0.00 | (f) | 0.07 | 0.02 | 0.68 | (g) | 0.01 | |||||||||||||
Net realized and unrealized gain on investments | 2.44 | 5.44 | 0.12 | 0.29 | (h) | 3.01 | ||||||||||||||
Total from investment operations | 2.44 | 5.51 | 0.14 | 0.97 | 3.02 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | — | (0.09 | ) | (0.02 | ) | (0.66 | ) | (0.02 | ) | |||||||||||
Return of capital | — | — | — | (0.12 | ) | — | ||||||||||||||
Total distributions | — | (0.09 | ) | (0.02 | ) | (0.78 | ) | (0.02 | ) | |||||||||||
Net asset value at end of year | $ | 22.09 | $ | 19.65 | $ | 14.23 | $ | 14.11 | $ | 13.92 | ||||||||||
Market price at end of year(c) | $ | 22.10 | $ | 19.63 | $ | 14.20 | $ | 14.09 | $ | 13.92 | ||||||||||
Net Asset Value Total Return:(d) | 12.42 | % | 38.85 | % | 0.99 | % | 7.49 | % | 27.65 | % | ||||||||||
Market Price Total Return(d) | 12.58 | % | 39.01 | % | 0.92 | % | 7.34 | % | 27.42 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 123,688 | $ | 104,121 | $ | 30,600 | $ | 40,204 | $ | 50,114 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.63 | % | 0.69 | % | 1.01 | % | 0.91 | % | 0.76 | % | ||||||||||
Net investment income, after Waivers | 0.01 | % | 0.44 | % | 0.12 | % | 5.25 | %(g) | 0.07 | % | ||||||||||
Portfolio turnover rate(e) | 117 | % | 95 | % | 72 | % | 75 | % | 59 | % |
(a) | Based on average shares outstanding. |
(b) | Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $1.41 per share owned of PDL BioPharma, Inc. on December 15, 2009. Net investment loss per share and the ratio of net investment loss to average net assets excluding the special dividend are $(0.03) and (0.18)%, respectively. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(f) | Amount represents less than $0.005. |
(g) | Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $1.65 per share owned of Weyerhaeuser Co. on July 20, 2010. Net investment income per share and the ratio of net investment income to average net assets excluding the special dividend are $0.03 and 0.26%, respectively. |
(h) | Due to the timing of creations and redemptions of capital shares, the net realized and unrealized gain (loss) per share is not in accord with the Fund’s change in net realized and unrealized gain (loss) on investment securities and in-kind transactions for the period. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 56 |
|
Financial Highlights (continued)
PowerShares Dynamic Energy Exploration & Production Portfolio (PXE)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 30.27 | $ | 24.58 | $ | 27.67 | $ | 18.46 | $ | 13.17 | ||||||||||
Net investment income(a) | 0.48 | 0.53 | 0.19 | 0.12 | 0.10 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 7.55 | 5.81 | (2.94 | ) | 9.21 | 5.27 | ||||||||||||||
Total from investment operations | 8.03 | 6.34 | (2.75 | ) | 9.33 | 5.37 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.54 | ) | (0.65 | ) | (0.34 | ) | (0.12 | ) | (0.07 | ) | ||||||||||
Return of capital | — | — | — | — | (0.01 | ) | ||||||||||||||
Total distributions | (0.54 | ) | (0.65 | ) | (0.34 | ) | (0.12 | ) | (0.08 | ) | ||||||||||
Net asset value at end of year | $ | 37.76 | $ | 30.27 | $ | 24.58 | $ | 27.67 | $ | 18.46 | ||||||||||
Market price at end of year(b) | $ | 37.76 | $ | 30.23 | $ | 24.57 | $ | 27.65 | $ | 18.46 | ||||||||||
Net Asset Value Total Return:(c) | 26.93 | % | 26.14 | % | (9.86 | )% | 50.80 | % | 40.87 | % | ||||||||||
Market Price Total Return(c) | 27.10 | % | 26.03 | % | (9.83 | )% | 50.69 | % | 41.08 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 130,273 | $ | 104,427 | $ | 67,592 | $ | 118,975 | $ | 59,983 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | % | 0.65 | % | 0.65 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.64 | % | 0.69 | % | 0.73 | % | 0.76 | % | 0.76 | % | ||||||||||
Net investment income, after Waivers | 1.46 | % | 1.97 | % | 0.81 | % | 0.57 | % | 0.62 | % | ||||||||||
Portfolio turnover rate(d) | 96 | % | 80 | % | 94 | % | 57 | % | 68 | % |
PowerShares Dynamic Food & Beverage Portfolio (PBJ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 23.62 | $ | 19.77 | $ | 19.76 | $ | 16.00 | $ | 12.73 | ||||||||||
Net investment income(a) | 0.38 | 0.26 | 0.22 | 0.24 | 0.20 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 3.19 | 3.92 | (0.03 | ) | 3.73 | 3.33 | ||||||||||||||
Total from investment operations | 3.57 | 4.18 | 0.19 | 3.97 | 3.53 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.21 | ) | (0.33 | ) | (0.18 | ) | (0.21 | ) | (0.26 | ) | ||||||||||
Net asset value at end of year | $ | 26.98 | $ | 23.62 | $ | 19.77 | $ | 19.76 | $ | 16.00 | ||||||||||
Market price at end of year(b) | $ | 26.99 | $ | 23.61 | $ | 19.77 | $ | 19.81 | $ | 16.01 | ||||||||||
Net Asset Value Total Return:(c) | 15.16 | % | 21.45 | % | 1.02 | % | 24.99 | % | 28.08 | % | ||||||||||
Market Price Total Return(c) | 15.25 | % | 21.40 | % | 0.77 | % | 25.23 | % | 28.06 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 434,371 | $ | 236,226 | $ | 169,039 | $ | 91,881 | $ | 72,795 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.61 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.61 | % | 0.63 | % | 0.64 | % | 0.71 | % | 0.74 | % | ||||||||||
Net investment income, after Waivers | 1.47 | % | 1.28 | % | 1.13 | % | 1.39 | % | 1.41 | % | ||||||||||
Portfolio turnover rate(d) | 145 | % | 92 | % | 134 | % | 73 | % | 65 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 27.23 | $ | 22.18 | $ | 19.34 | $ | 16.52 | $ | 10.65 | ||||||||||
Net investment income(a) | 0.15 | 0.12 | 0.15 | 0.16 | 0.05 | |||||||||||||||
Net realized and unrealized gain on investments | 5.10 | 5.09 | 2.82 | 2.81 | 5.88 | |||||||||||||||
Total from investment operations | 5.25 | 5.21 | 2.97 | 2.97 | 5.93 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.13 | ) | (0.16 | ) | (0.13 | ) | (0.15 | ) | (0.06 | ) | ||||||||||
Net asset value at end of year | $ | 32.35 | $ | 27.23 | $ | 22.18 | $ | 19.34 | $ | 16.52 | ||||||||||
Market price at end of year(b) | $ | 32.34 | $ | 27.21 | $ | 22.20 | $ | 19.34 | $ | 16.54 | ||||||||||
Net Asset Value Total Return:(c) | 19.29 | % | 23.67 | % | 15.49 | % | 18.03 | % | 55.81 | % | ||||||||||
Market Price Total Return(c) | 19.34 | % | 23.47 | % | 15.59 | % | 17.89 | % | 56.29 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 177,930 | $ | 85,765 | $ | 57,679 | $ | 60,933 | $ | 62,794 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.63 | % | 0.69 | % | 0.80 | % | 0.78 | % | 1.06 | % | ||||||||||
Net investment income, after Waivers | 0.48 | % | 0.52 | % | 0.80 | % | 0.92 | % | 0.41 | % | ||||||||||
Portfolio turnover rate(d) | 171 | % | 93 | % | 90 | % | 58 | % | 68 | % |
PowerShares Dynamic Media Portfolio (PBS)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 20.11 | $ | 14.84 | $ | 15.61 | $ | 13.68 | $ | 8.25 | ||||||||||
Net investment income(a) | 0.09 | 0.12 | 0.08 | 0.07 | 0.06 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 3.70 | 5.28 | (0.76 | ) | 1.93 | 5.42 | ||||||||||||||
Total from investment operations | 3.79 | 5.40 | (0.68 | ) | 2.00 | 5.48 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.09 | ) | (0.13 | ) | (0.09 | ) | (0.07 | ) | (0.05 | ) | ||||||||||
Return of capital | — | — | — | — | (0.00 | )(e) | ||||||||||||||
Total distributions | (0.09 | ) | (0.13 | ) | (0.09 | ) | (0.07 | ) | (0.05 | ) | ||||||||||
Net asset value at end of year | $ | 23.81 | $ | 20.11 | $ | 14.84 | $ | 15.61 | $ | 13.68 | ||||||||||
Market price at end of year(b) | $ | 23.79 | $ | 20.10 | $ | 14.84 | $ | 15.61 | $ | 13.70 | ||||||||||
Net Asset Value Total Return:(c) | 18.87 | % | 36.62 | % | (4.33 | )% | 14.68 | % | 66.55 | % | ||||||||||
Market Price Total Return(c) | 18.83 | % | 36.55 | % | (4.33 | )% | 14.51 | % | 66.59 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 171,430 | $ | 150,788 | $ | 137,975 | $ | 156,881 | $ | 125,875 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.62 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.62 | % | 0.63 | % | 0.65 | % | 0.69 | % | 0.77 | % | ||||||||||
Net investment income, after Waivers | 0.38 | % | 0.71 | % | 0.60 | % | 0.57 | % | 0.51 | % | ||||||||||
Portfolio turnover rate(d) | 120 | % | 70 | % | 89 | % | 53 | % | 50 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(e) | Amount represents less than $0.005. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Dynamic Networking Portfolio (PXQ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 25.00 | $ | 27.71 | $ | 29.20 | $ | 21.08 | $ | 13.56 | ||||||||||
Net investment income (loss)(a) | (0.04 | ) | 0.20 | (b) | (0.06 | ) | (0.10 | ) | (0.09 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | 6.44 | (2.85 | ) | (1.43 | ) | 8.33 | 7.61 | |||||||||||||
Total from investment operations | 6.40 | (2.65 | ) | (1.49 | ) | 8.23 | 7.52 | |||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.20 | ) | (0.06 | ) | — | — | — | |||||||||||||
Return of capital | — | — | — | (0.11 | ) | — | ||||||||||||||
Total distributions | (0.20 | ) | (0.06 | ) | — | (0.11 | ) | — | ||||||||||||
Net asset value at end of year | $ | 31.20 | $ | 25.00 | $ | 27.71 | $ | 29.20 | $ | 21.08 | ||||||||||
Market price at end of year(c) | $ | 31.19 | $ | 24.97 | $ | 27.68 | $ | 29.20 | $ | 21.11 | ||||||||||
Net Asset Value Total Return:(d) | 25.69 | % | (9.57 | )% | (5.10 | )% | 39.08 | % | 55.46 | % | ||||||||||
Market Price Total Return(d) | 25.80 | % | (9.58 | )% | (5.20 | )% | 38.89 | % | 55.45 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 29,643 | $ | 30,000 | $ | 81,739 | $ | 172,291 | $ | 47,437 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.64 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.82 | % | 0.75 | % | 0.67 | % | 0.70 | % | 0.95 | % | ||||||||||
Net investment income (loss), after Waivers | (0.12 | )% | 0.81 | %(b) | (0.22 | )% | (0.38 | )% | (0.50 | )% | ||||||||||
Portfolio turnover rate(e) | 69 | % | 68 | % | 84 | % | 61 | % | 29 | % |
PowerShares Dynamic Oil & Gas Services Portfolio (PXJ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 22.49 | $ | 20.48 | $ | 26.38 | $ | 18.03 | $ | 13.09 | ||||||||||
Net investment income (loss)(a) | 0.08 | 0.04 | (0.01 | ) | 0.07 | 0.04 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 5.53 | (f) | 2.00 | (5.89 | ) | 8.36 | 4.98 | |||||||||||||
Total from investment operations | 5.61 | 2.04 | (5.90 | ) | 8.43 | 5.02 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.09 | ) | (0.03 | ) | (0.00 | )(g) | (0.08 | ) | (0.06 | ) | ||||||||||
Return of capital | — | — | — | — | (0.02 | ) | ||||||||||||||
Total distributions | (0.09 | ) | (0.03 | ) | (0.00 | )(g) | (0.08 | ) | (0.08 | ) | ||||||||||
Net asset value at end of year | $ | 28.01 | $ | 22.49 | $ | 20.48 | $ | 26.38 | $ | 18.03 | ||||||||||
Market price at end of year(c) | $ | 28.00 | $ | 22.49 | $ | 20.48 | $ | 26.38 | $ | 18.02 | ||||||||||
Net Asset Value Total Return:(d) | 24.98 | %(f) | 9.95 | % | (22.36 | )% | 46.84 | % | 38.41 | % | ||||||||||
Market Price Total Return(d) | 24.94 | % | 9.95 | % | (22.36 | )% | 46.93 | % | 38.13 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 135,849 | $ | 116,973 | $ | 147,485 | $ | 309,972 | $ | 170,358 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.61 | % | 0.62 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.61 | % | 0.62 | % | 0.63 | % | 0.64 | % | 0.63 | % | ||||||||||
Net investment income (loss), after Waivers | 0.31 | % | 0.18 | % | (0.03 | )% | 0.36 | % | 0.24 | % | ||||||||||
Portfolio turnover rate(e) | 259 | %(f) | 68 | % | 70 | % | 39 | % | 56 | % |
(a) | Based on average shares outstanding. |
(b) | Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $1 per share owned of Tellabs, Inc. on December 24, 2012. Net investment loss per share and the ratio of net investment loss to average net assets excluding the special dividend are $(0.01) and (0.05)%, respectively. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
(f) | Amount includes the effect of the Adviser pay-in for an economic loss of $0.43 per share. Had the pay-in not been made, the net asset value total return would have been 23.06%. In addition, the portfolio turnover calculation includes the value of securities purchased and sold related to this transaction. |
(g) | Amount represents less than $0.005. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Dynamic Pharmaceuticals Portfolio (PJP)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 40.72 | $ | 32.00 | $ | 26.15 | $ | 19.55 | $ | 13.91 | ||||||||||
Net investment income(a) | 0.26 | 0.54 | (b) | 0.22 | 0.17 | 0.14 | ||||||||||||||
Net realized and unrealized gain on investments | 16.90 | 8.72 | 5.83 | 6.56 | 5.76 | |||||||||||||||
Total from investment operations | 17.16 | 9.26 | 6.05 | 6.73 | 5.90 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.23 | ) | (0.54 | ) | (0.20 | ) | (0.13 | ) | (0.26 | ) | ||||||||||
Net asset value at end of year | $ | 57.65 | $ | 40.72 | $ | 32.00 | $ | 26.15 | $ | 19.55 | ||||||||||
Market price at end of year(c) | $ | 57.60 | $ | 40.72 | $ | 31.99 | $ | 26.17 | $ | 19.54 | ||||||||||
Net Asset Value Total Return:(d) | 42.27 | % | 29.25 | % | 23.29 | % | 34.55 | % | 42.69 | % | ||||||||||
Market Price Total Return(d) | 42.15 | % | 29.29 | % | 23.16 | % | 34.73 | % | 42.51 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 1,104,007 | $ | 468,305 | $ | 270,385 | $ | 87,606 | $ | 57,662 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.58 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.58 | % | 0.63 | % | 0.64 | % | 0.76 | % | 0.74 | % | ||||||||||
Net investment income, after Waivers | 0.52 | % | 1.52 | %(b) | 0.77 | % | 0.78 | % | 0.83 | % | ||||||||||
Portfolio turnover rate(e) | 39 | % | 24 | % | 23 | % | 9 | % | 35 | % |
PowerShares Dynamic Retail Portfolio (PMR)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 29.12 | $ | 25.98 | $ | 21.88 | $ | 18.67 | $ | 14.64 | ||||||||||
Net investment income(a) | 0.32 | 0.66 | 0.16 | 0.18 | 0.06 | |||||||||||||||
Net realized and unrealized gain on investments | 3.99 | 3.11 | 4.17 | 3.21 | 4.08 | |||||||||||||||
Total from investment operations | 4.31 | 3.77 | 4.33 | 3.39 | 4.14 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.28 | ) | (0.63 | ) | (0.23 | ) | (0.18 | ) | (0.11 | ) | ||||||||||
Net asset value at end of year | $ | 33.15 | $ | 29.12 | $ | 25.98 | $ | 21.88 | $ | 18.67 | ||||||||||
Market price at end of year(c) | $ | 33.14 | $ | 29.11 | $ | 25.98 | $ | 21.90 | $ | 18.68 | ||||||||||
Net Asset Value Total Return:(d) | 14.81 | % | 14.87 | % | 20.06 | % | 18.35 | % | 28.49 | % | ||||||||||
Market Price Total Return(d) | 14.81 | % | 14.83 | % | 19.95 | % | 18.39 | % | 28.56 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 24,864 | $ | 24,750 | $ | 76,643 | $ | 13,130 | $ | 24,273 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.79 | % | 0.74 | % | 0.87 | % | 1.63 | % | 0.89 | % | ||||||||||
Net investment income, after Waivers | 0.96 | % | 2.59 | % | 0.75 | % | 1.01 | % | 0.44 | % | ||||||||||
Portfolio turnover rate(e) | 184 | % | 83 | % | 111 | % | 102 | % | 52 | % |
(a) | Based on average shares outstanding. |
(b) | Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $4 per share owned of Warner Chilcott PLC. on August 29, 2012. Net investment income per share and the ratio of net investment income to average net assets excluding the special dividend are $0.32 and 0.91%, respectively. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares Dynamic Semiconductors Portfolio (PSI)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 15.22 | $ | 15.75 | $ | 18.19 | $ | 14.29 | $ | 10.39 | ||||||||||
Net investment income(a) | 0.10 | 0.11 | 0.06 | 0.01 | 0.05 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 5.41 | (0.52 | ) | (2.47 | ) | 3.92 | 3.91 | |||||||||||||
Total from investment operations | 5.51 | (0.41 | ) | (2.41 | ) | 3.93 | 3.96 | |||||||||||||
Distribution to shareholder from: | ||||||||||||||||||||
Net investment income | (0.11 | ) | (0.12 | ) | (0.03 | ) | (0.01 | ) | (0.06 | ) | ||||||||||
Return of capital | — | — | — | (0.02 | ) | (0.00 | )(b) | |||||||||||||
Total distributions | (0.11 | ) | (0.12 | ) | (0.03 | ) | (0.03 | ) | (0.06 | ) | ||||||||||
Net asset value at end of year | $ | 20.62 | $ | 15.22 | $ | 15.75 | $ | 18.19 | $ | 14.29 | ||||||||||
Market price at end of year(c) | $ | 20.62 | $ | 15.19 | $ | 15.71 | $ | 18.20 | $ | 14.29 | ||||||||||
Net Asset Value Total Return:(d) | 36.38 | % | (2.56 | )% | (13.20 | )% | 27.57 | % | 38.16 | % | ||||||||||
Market Price Total Return(d) | 36.66 | % | (2.50 | )% | (13.47 | )% | 27.64 | % | 38.16 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 20,621 | $ | 16,744 | $ | 21,261 | $ | 42,749 | $ | 28,573 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 1.05 | % | 1.05 | % | 1.02 | % | 0.97 | % | 0.90 | % | ||||||||||
Net investment income, after Waivers | 0.55 | % | 0.77 | % | 0.42 | % | 0.04 | % | 0.39 | % | ||||||||||
Portfolio turnover rate(e) | 126 | % | 91 | % | 57 | % | 64 | % | 68 | % |
PowerShares Dynamic Software Portfolio (PSJ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 30.16 | $ | 26.87 | $ | 27.47 | $ | 22.54 | $ | 15.37 | ||||||||||
Net investment income (loss)(a) | (0.00 | )(b) | (0.01 | ) | (0.07 | ) | (0.07 | ) | (0.07 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | 3.80 | 3.30 | (0.53 | ) | 5.00 | 7.24 | ||||||||||||||
Total from investment operations | 3.80 | 3.29 | (0.60 | ) | 4.93 | 7.17 | ||||||||||||||
Net asset value at end of year | $ | 33.96 | $ | 30.16 | $ | 26.87 | $ | 27.47 | $ | 22.54 | ||||||||||
Market price at end of year(c) | $ | 33.93 | $ | 30.12 | $ | 26.87 | $ | 27.48 | $ | 22.55 | ||||||||||
Net Asset Value Total Return:(d) | 12.60 | % | 12.24 | % | (2.19 | )% | 21.87 | % | 46.65 | % | ||||||||||
Market Price Total Return(d) | 12.65 | % | 12.09 | % | (2.22 | )% | 21.86 | % | 46.71 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 54,335 | $ | 48,257 | $ | 49,710 | $ | 83,774 | $ | 67,626 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.69 | % | 0.74 | % | 0.78 | % | 0.77 | % | 0.75 | % | ||||||||||
Net investment income (loss), after Waivers | (0.01 | )% | (0.03 | )% | (0.29 | )% | (0.29 | )% | (0.38 | )% | ||||||||||
Portfolio turnover rate(e) | 150 | % | 95 | % | 100 | % | 46 | % | 33 | % |
(a) | Based on average shares outstanding. |
(b) | Amount represents less than $0.005. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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PowerShares Exchange-Traded Fund Trust
April 30, 2014
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the “Trust”) was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). As of April 30, 2014, the Trust offered fifty-three portfolios. This report includes the following portfolios:
Full Name | Short Name | |
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) | “Dynamic Biotechnology & Genome Portfolio” | |
PowerShares Dynamic Building & Construction Portfolio (PKB) | “Dynamic Building & Construction Portfolio” | |
PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) | “Dynamic Energy Exploration & Production Portfolio” | |
PowerShares Dynamic Food & Beverage Portfolio (PBJ) | “Dynamic Food & Beverage Portfolio” | |
PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ) | “Dynamic Leisure and Entertainment Portfolio” | |
PowerShares Dynamic Media Portfolio (PBS) | “Dynamic Media Portfolio” | |
PowerShares Dynamic Networking Portfolio (PXQ) | “Dynamic Networking Portfolio” | |
PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) | “Dynamic Oil & Gas Services Portfolio” | |
PowerShares Dynamic Pharmaceuticals Portfolio (PJP) | “Dynamic Pharmaceuticals Portfolio” | |
PowerShares Dynamic Retail Portfolio (PMR) | “Dynamic Retail Portfolio” | |
PowerShares Dynamic Semiconductors Portfolio (PSI) | “Dynamic Semiconductors Portfolio” | |
PowerShares Dynamic Software Portfolio (PSJ) | “Dynamic Software Portfolio” |
Each portfolio (each, a “Fund”, and collectively, the “Funds”) represents a separate series of the Trust. The shares of the Funds are referred to herein as “Shares” or “Fund’s Shares.” Each Fund’s Shares are listed and traded on NYSE Arca, Inc.
The market prices of each Fund’s Shares may differ to some degree from the Fund’s net asset value (“NAV”). Unlike conventional mutual funds, each Fund issues and redeems Shares on a continuous basis, at NAV, only in a large specified number of Shares, each called a “Creation Unit.” Creation Units are issued and in exchange for the deposit or delivery of a basket of securities (“Deposit Securities”). Except when aggregated in Creation Units by Authorized Participants, the Shares are not individually redeemable securities of the Funds.
The investment objective of each Fund is to seek investment results that generally correspond (before fees and expenses) to the price and yield of its respective index listed below (each, an “Underlying Index”):
Fund | Underlying Index | |
Dynamic Biotechnology & Genome Portfolio | Dynamic Biotech & Genome IntellidexSM Index | |
Dynamic Building & Construction Portfolio | Dynamic Building & Construction IntellidexSM Index | |
Dynamic Energy Exploration & Production Portfolio | Dynamic Energy Exploration & Production IntellidexSM Index | |
Dynamic Food & Beverage Portfolio | Dynamic Food & Beverage IntellidexSM Index | |
Dynamic Leisure and Entertainment Portfolio | Dynamic Leisure & Entertainment IntellidexSM Index | |
Dynamic Media Portfolio | Dynamic Media IntellidexSM Index | |
Dynamic Networking Portfolio | Dynamic Networking IntellidexSM Index | |
Dynamic Oil & Gas Services Portfolio | Dynamic Oil Services IntellidexSM Index | |
Dynamic Pharmaceuticals Portfolio | Dynamic Pharmaceutical IntellidexSM Index | |
Dynamic Retail Portfolio | Dynamic Retail IntellidexSM Index | |
Dynamic Semiconductors Portfolio | Dynamic Semiconductor IntellidexSM Index | |
Dynamic Software Portfolio | Dynamic Software IntellidexSM Index |
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates. In addition, the Funds monitor for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.
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A. Security Valuation
Securities, including restricted securities, are valued according to the following policies.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and ask prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and ask prices. For purposes of determining NAV per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end of day NAV per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Securities with a demand feature exercisable within one to seven days are valued at par. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that Invesco PowerShares Capital Management LLC (the “Adviser”) determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith following procedures approved by the Board of Trustees. Issuer-specific events, market trends, bid/ask quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
Each Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain of each Fund’s investments.
Valuations change in response to many factors, including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
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B. Other Risks
Index Risk. Unlike many investment companies, the Funds do not utilize investing strategies that seek returns in excess of their Underlying Indexes. Therefore, a Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its respective Underlying Index, even if that security generally is underperforming.
Equity Risk. Equity risk is the risk that the value of the securities that each Fund holds will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities a Fund holds participate or factors relating to specific companies in which the Funds invest. For example, an adverse event, such as an unfavorable earnings report, may depress the value of securities a Fund holds; the price of securities may be particularly sensitive to general movements in the stock market; or a drop in the stock market may depress the price of most or all of the securities a Fund holds. In addition, securities of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition.
Industry Concentration Risk. In following its methodology, each Fund’s Underlying Index from time to time may be concentrated to a significant degree in securities of issuers located in a single industry or a sector. To the extent that an Underlying Index concentrates in the securities of issuers in a particular industry or sector, each Fund will also concentrate its investments to approximately the same extent. By concentrating its investments in an industry or sector, a Fund may face more risks than if it were diversified broadly over numerous industries or sectors. In addition, at times, an industry or sector may be out of favor and underperform other industries or the market as a whole. Any factors detrimental to the performance of such industry or sector will disproportionately impact a Fund’s NAV.
Non-Diversified Fund Risk. Each Fund is non-diversified and can invest a greater portion of its assets in securities of individual issuers than diversified funds. As a result, changes in the market value of a single investment could cause greater fluctuations in Share price than would occur in a diversified fund. This may increase a Fund’s volatility and cause the performance of a relatively small number of issuers to have a greater impact on a Fund’s performance.
Non-Correlation Risk. Each Fund’s return may not match the return of its Underlying Index for a number of reasons. For example, each Fund incurs operating expenses not applicable to its Underlying Index, and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of its Underlying Index. In addition, the performance of each Fund and its Underlying Index may vary due to asset valuation differences and differences between each Fund’s portfolio and its Underlying Index resulting from legal restrictions, cost or liquidity constraints.
Small and Medium Capitalization Company Risk. Investing in securities of small and medium capitalization companies involves greater risk than customarily is associated with investing in larger, more established companies. These companies’ securities may be more volatile and less liquid than those of more established companies. These securities may have returns that vary, sometimes significantly, from the overall securities market. Often small and medium capitalization companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and to distribute substantially all of the Fund’s taxable earnings to its shareholders. As such, the Funds will not be subject to federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements.
Each Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed each Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These timing differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and passive foreign investment company adjustments, if any.
The Funds file U.S. federal tax returns and tax returns in certain other jurisdictions. Generally, a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Transactions and Investment Income
Investment transactions are accounted for on a trade date basis. Realized gains and losses from the sale or disposition of securities are computed on the specific identified cost basis. Interest income is recorded on the accrual basis. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. Realized gains, dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
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Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date.
E. Expenses
Expenses of the Trust that are directly identifiable to a specific Fund are applied to that Fund. Expenses of the Trust that are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, sub-licensing fees related to its respective Underlying Index, any distribution fees or expenses, litigation expenses, fees payable to the Trust’s Board members who are not “interested persons” (as defined in the 1940 Act) of the Trust (the “Independent Trustees”) or the Adviser, expenses incurred in connection with the Board members’ services, including travel expenses and legal fees of counsel for the Independent Trustees, acquired fund fees and expenses, if any, and extraordinary expenses.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and records such dividends on ex-dividend date. Generally, each Fund distributes net realized taxable capital gains, if any, annually in cash and records them on ex-dividend date. Such distributions on a tax basis are determined in conformity with federal income tax regulations, which may differ from GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund’s financial statements as a tax return of capital at fiscal period-end.
G. Securities Lending
During the fiscal year ended April 30, 2014, Dynamic Biotechnology & Genome Portfolio, Dynamic Media Portfolio, and Dynamic Pharmaceuticals Portfolio participated in securities lending. Each Fund loaned portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by cash collateral equal to no less than 102% of the market value of the loaned securities determined daily by the securities lending provider. Cash collateral received in connection with these loans is invested in an affiliated money market fund and is shown as such on the Schedule of Investments. It is the policy of the Fund to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to a Fund if, and to the extent that, the market value of the securities loaned were to increase, and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. A Fund could experience delays and costs in gaining access to the collateral. A Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Securities lending income on the Statements of Operations. The aggregate value of securities out on loan is shown on the Statements of Assets and Liabilities, if any. Dynamic Media Portfolio no longer participates in securities lending.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser pursuant to which the Adviser has overall responsibility for the selection and ongoing monitoring of the Funds’ investments, managing the Funds’ business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund has agreed to pay the Adviser an annual fee of 0.50% of the Fund’s average daily net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement (the “Expense Agreement”) with the Trust on behalf of each Fund, pursuant to which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses (excluding interest expenses, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes, acquired fund fees and expenses, if any, and extraordinary expenses) of each Fund from exceeding 0.60% of the Fund’s average daily net assets per year (the “Expense Cap”), through at least August 31, 2015. Offering costs excluded from the Expense Cap are: (a) initial legal fees pertaining to the Funds’ Shares offered for sale; (b) initial Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange. Unless the Adviser continues the Expense Agreement, it will terminate on August 31, 2015. The Expense Agreement cannot be terminated during its term. The Adviser did not waive fees and/or pay fund expenses during the period under this Expense Cap for Dynamic Biotechnology & Genome Portfolio, Dynamic Building & Construction Portfolio, Dynamic Energy Exploration & Production Portfolio, Dynamic Food & Beverage Portfolio, Dynamic Leisure and Entertainment Portfolio, Dynamic Media Portfolio, Dynamic Oil & Gas Services Portfolio and Dynamic Pharmaceuticals Portfolio.
Further, through August 31, 2015, the Adviser has contractually agreed to waive a portion of the Fund’s management fee in an amount equal to 100% of the net advisory fees an affiliate of the Adviser receives that are attributable to certain of the Fund’s investments in money market funds managed by that affiliate (excluding investments of cash collateral from securities lending). The Adviser cannot discontinue this waiver prior to its expiration.
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For the fiscal year ended April 30, 2014, the Adviser waived fees and/or paid Fund expenses for each Fund, in the following amounts:
Dynamic Biotechnology & Genome Portfolio | $ | 140 | ||
Dynamic Building & Construction Portfolio | 97 | |||
Dynamic Energy Exploration & Production Portfolio | 110 | |||
Dynamic Food & Beverage Portfolio | 159 | |||
Dynamic Leisure and Entertainment Portfolio | 91 | |||
Dynamic Media Portfolio | 141 | |||
Dynamic Networking Portfolio | 58,971 | |||
Dynamic Oil & Gas Services Portfolio | 110 | |||
Dynamic Pharmaceuticals Portfolio | 408 | |||
Dynamic Retail Portfolio | 52,899 | |||
Dynamic Semiconductors Portfolio | 69,257 | |||
Dynamic Software Portfolio | 34,897 |
For the fiscal year ended April 30, 2014, the Adviser reimbursed Dynamic Oil & Gas Services Portfolio for an economic loss of $2,071,089 as a result of trading related activity.
The Expense Agreement provides that the fees waived or expenses borne by the Adviser are subject to recapture by the Adviser for up to three years, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above.
For the following Funds, the amounts available for potential future recapture by the Adviser under the Expense Agreement and the expiration schedule at April 30, 2014 are as follows:
Total Potential Recapture Amounts | Potential Recapture Amounts Expiring | |||||||||||||||
04/30/15 | 04/30/16 | 04/30/17 | ||||||||||||||
Dynamic Building & Construction Portfolio | $ | 142,366 | $ | 107,359 | $ | 35,007 | $ | — | ||||||||
Dynamic Energy Exploration & Production Portfolio | 92,885 | 61,176 | 31,709 | — | ||||||||||||
Dynamic Leisure and Entertainment Portfolio | 127,087 | 87,312 | 39,775 | — | ||||||||||||
Dynamic Networking Portfolio | 159,129 | 47,952 | 52,287 | 58,890 | ||||||||||||
Dynamic Retail Portfolio | 196,433 | 87,876 | 55,726 | 52,831 | ||||||||||||
Dynamic Semiconductors Portfolio | 242,025 | 99,564 | 73,270 | 69,191 | ||||||||||||
Dynamic Software Portfolio | 168,423 | 81,932 | 51,699 | 34,792 |
The Trust has entered into a Distribution Agreement with Invesco Distributors, Inc. (the “Distributor”), which serves as the distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in the Shares. The Funds are not charged any fees pursuant to the Distribution Agreement. The Distributor is an affiliate of the Adviser.
The Adviser has entered into a licensing agreement for each Fund with NYSE Arca, Inc. (the “Licensor”). Each Underlying Index name trademark is owned by the Licensor. These trademarks have been licensed to the Adviser for use by the Funds. Each Fund is entitled to use its Underlying Index pursuant to the Trust’s sub-licensing agreement with the Adviser. The Funds are required to pay the sub-licensing fees that are shown on the Statements of Operations. The Funds are not sponsored, endorsed, sold or promoted by the Licensor, and the Licensor makes no representation regarding the advisability of investing in any of the Funds.
The Trust has entered into service agreements whereby The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian, fund accountant and transfer agent for each Fund.
Note 4. Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
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Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
As of April 30, 2014, all of the securities in each Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Note 5. Distributions to Shareholders and Tax Components of Net Assets
Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended April 30, 2014 and 2013:
2014 | 2013 | |||||||
Ordinary Income | Ordinary Income | |||||||
Dynamic Biotechnology & Genome Portfolio | $ | — | $ | — | ||||
Dynamic Building & Construction Portfolio | — | 322,061 | ||||||
Dynamic Energy Exploration & Production Portfolio | 1,698,221 | 1,748,096 | ||||||
Dynamic Food & Beverage Portfolio | 1,980,743 | 1,927,726 | ||||||
Dynamic Leisure and Entertainment Portfolio | 649,713 | 444,843 | ||||||
Dynamic Media Portfolio | 902,729 | 917,905 | ||||||
Dynamic Networking Portfolio | 230,610 | 93,171 | ||||||
Dynamic Oil & Gas Services Portfolio | 414,523 | 143,856 | ||||||
Dynamic Pharmaceuticals Portfolio | 3,255,531 | 4,861,110 | ||||||
Dynamic Retail Portfolio | 250,815 | 1,304,529 | ||||||
Dynamic Semiconductors Portfolio | 107,690 | 140,761 | ||||||
Dynamic Software Portfolio | — | — |
Tax Components of Net Assets at Fiscal Year-End:
Undistributed Ordinary Income | Temporary Book/Tax Differences | Net Unrealized Appreciation (Depreciation)— Investment Securities | Capital Loss Carryforward | Late-Year Ordinary/Post- October Deferrals* | Shares of Beneficial Interest | Total Net Assets | ||||||||||||||||||||||
Dynamic Biotechnology & Genome Portfolio | $ | 118,672 | $ | (18,456 | ) | $ | 17,217,938 | $ | (161,027,890 | ) | $ | — | $ | 505,029,446 | $ | 361,319,710 | ||||||||||||
Dynamic Building & Construction Portfolio** | — | (11,510 | ) | 6,464,553 | (18,120,362 | ) | (30,632 | ) | 135,385,959 | 123,688,008 | ||||||||||||||||||
Dynamic Energy Exploration & Production Portfolio** | 578,872 | (13,525 | ) | 13,644,046 | (46,293,072 | ) | (1,764,136 | ) | 164,120,713 | 130,272,898 | ||||||||||||||||||
Dynamic Food & Beverage Portfolio** | 2,376,985 | (15,388 | ) | 16,384,028 | (37,742,870 | ) | (1,662,524 | ) | 455,031,119 | 434,371,350 | ||||||||||||||||||
Dynamic Leisure and Entertainment Portfolio | 106,596 | (11,612 | ) | 235,988 | (12,703,051 | ) | — | 190,301,885 | 177,929,806 | |||||||||||||||||||
Dynamic Media Portfolio** | 117,724 | (13,728 | ) | (6,229,290 | ) | (45,120,240 | ) | (3,406,440 | ) | 226,081,682 | 171,429,708 | |||||||||||||||||
Dynamic Networking Portfolio** | — | (11,180 | ) | 3,640,116 | (34,331,855 | ) | (862,941 | ) | 61,208,649 | 29,642,789 | ||||||||||||||||||
Dynamic Oil & Gas Services Portfolio** | 225,630 | (19,260 | ) | 17,530,051 | (194,929,118 | ) | (4,408,619 | ) | 317,450,766 | 135,849,450 | ||||||||||||||||||
Dynamic Pharmaceuticals Portfolio | 1,500,129 | (20,844 | ) | 191,188,182 | (3,087,828 | ) | — | 914,427,185 | 1,104,006,824 | |||||||||||||||||||
Dynamic Retail Portfolio** | 105,226 | (10,460 | ) | (109,330 | ) | (17,702,697 | ) | (1,412,358 | ) | 43,993,179 | 24,863,560 | |||||||||||||||||
Dynamic Semiconductors Portfolio** | 38,219 | (10,980 | ) | 2,385,064 | (54,177,813 | ) | (54,497 | ) | 72,440,999 | 20,620,992 | ||||||||||||||||||
Dynamic Software Portfolio** | — | (11,496 | ) | (911,072 | ) | (22,720,166 | ) | (19,706 | ) | 77,997,730 | 54,335,290 |
* | Includes net capital losses incurred after October 31(“Post-October Capital Losses”) and the combination of ordinary losses incurred after December 31 within the taxable year and specified losses incurred after October 31 within the taxable year (“Late-Year Ordinary Losses”), that are deemed to arise on the first business day of each Fund’s next taxable year. |
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** | The Dynamic Building & Construction Portfolio, Dynamic Energy Exploration & Production Portfolio, Dynamic Food & Beverage Portfolio, Dynamic Media Portfolio, Dynamic Networking Portfolio, Dynamic Oil & Gas Services Portfolio, Dynamic Retail Portfolio, Dynamic Semiconductors Portfolio and Dynamic Software Portfolio incurred and will elect to defer Late-Year Ordinary Losses of $30,632, $0, $0, $0, $11,806, $0, $0, $0 and $19,706 and Post-October Capital Losses of $0, $1,764,136, $1,662,524, $3,406,440, $851,135, $4,408,619, $1,412,358, $54,497 and $0, respectively. |
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Funds to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in 8 tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforward in the future may be limited under Internal Revenue Code and related regulations based on the results of future transactions.
The following Funds have capital loss carryforwards as of April 30, 2014, which expire as follows:
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2015 | 2016 | 2017 | 2018 | 2019 | Short-term | Long-term | Total* | Utilized | Expired | |||||||||||||||||||||||||||||||
Dynamic Biotechnology & Genome Portfolio | $ | 19,612,223 | $ | 15,818,255 | $ | 34,286,844 | $ | 50,397,332 | $ | 12,898,182 | $ | 27,323,719 | $ | 691,335 | $ | 161,027,890 | $ | 1,291,039 | $ | 321,497 | ||||||||||||||||||||
Dynamic Building & Construction Portfolio | 2,263,182 | 742,893 | 2,843,349 | 3,001,058 | 6,653,613 | 2,616,267 | — | 18,120,362 | 361,969 | — | ||||||||||||||||||||||||||||||
Dynamic Energy Exploration & Production Portfolio | 285,311 | 3,232,521 | 7,646,917 | 21,471,013 | 1,361,799 | 10,427,823 | 1,867,688 | 46,293,072 | — | — | ||||||||||||||||||||||||||||||
Dynamic Food & Beverage Portfolio | 239,185 | 1,260,041 | 7,585,250 | 10,245,302 | — | 18,413,092 | — | 37,742,870 | 6,225,131 | — | ||||||||||||||||||||||||||||||
Dynamic Leisure and Entertainment Portfolio | 1,611,839 | 2,111,801 | 2,895,936 | 2,889,449 | 2,356,106 | 837,920 | — | 12,703,051 | 6,745,537 | 751,908 | ||||||||||||||||||||||||||||||
Dynamic Media Portfolio | 3,187,134 | 2,505,039 | 4,930,761 | 5,161,647 | 6,294,489 | 22,487,376 | 553,794 | 45,120,240 | — | 545,973 | ||||||||||||||||||||||||||||||
Dynamic Networking Portfolio | 1,939,441 | 1,064,275 | 1,975,581 | 512,618 | 730,670 | 19,051,146 | 9,058,124 | 34,331,855 | — | 383,187 | ||||||||||||||||||||||||||||||
Dynamic Oil & Gas Services Portfolio | 15,026,862 | 7,909,602 | 24,680,663 | 85,028,926 | 35,877,910 | 14,879,231 | 11,525,924 | 194,929,118 | — | — | ||||||||||||||||||||||||||||||
Dynamic Pharmaceuticals Portfolio | — | — | — | 1,468,910 | 1,618,918 | — | — | 3,087,828 | 22,307,942 | — | ||||||||||||||||||||||||||||||
Dynamic Retail Portfolio | 937,070 | 1,908,967 | 2,427,604 | 1,816,180 | 2,176,015 | 8,353,449 | 83,412 | 17,702,697 | — | — | ||||||||||||||||||||||||||||||
Dynamic Semiconductors Portfolio | 9,158,832 | 10,196,415 | 14,001,359 | 10,902,954 | 2,120,823 | 6,716,042 | 1,081,388 | 54,177,813 | — | 271,588 | ||||||||||||||||||||||||||||||
Dynamic Software Portfolio | 3,017,278 | 1,542,190 | 7,095,351 | 2,938,722 | 3,242,208 | 4,884,417 | — | 22,720,166 | 826,186 | 108,427 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
Note 6. Investment Transactions
For the fiscal year ended April 30, 2014, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, U.S. Treasury obligations, money market funds and in-kind transactions, were as follows:
Purchases | Sales | |||||||
Dynamic Biotechnology & Genome Portfolio | $ | 172,714,096 | $ | 172,302,286 | ||||
Dynamic Building & Construction Portfolio | 123,676,896 | 122,597,757 | ||||||
Dynamic Energy Exploration & Production Portfolio | 103,954,219 | 103,326,470 | ||||||
Dynamic Food & Beverage Portfolio | 424,869,470 | 420,993,592 | ||||||
Dynamic Leisure and Entertainment Portfolio | 270,158,315 | 267,740,406 | ||||||
Dynamic Media Portfolio | 291,032,502 | 289,664,797 | ||||||
Dynamic Networking Portfolio | 21,772,260 | 22,647,167 | ||||||
Dynamic Oil & Gas Services Portfolio | 313,621,924 | 311,013,453 | ||||||
Dynamic Pharmaceuticals Portfolio | 325,819,227 | 321,644,759 | ||||||
Dynamic Retail Portfolio | 59,015,529 | 57,367,331 | ||||||
Dynamic Semiconductors Portfolio | 20,839,074 | 20,996,653 | ||||||
Dynamic Software Portfolio | 82,893,882 | 82,258,254 |
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For the fiscal year ended April 30, 2014, in-kind transactions associated with creations and redemptions were as follows:
Cost of Securities Received | Value of Securities Delivered | |||||||
Dynamic Biotechnology & Genome Portfolio | $ | 370,769,370 | $ | 232,414,884 | ||||
Dynamic Building & Construction Portfolio | 97,893,734 | 89,308,574 | ||||||
Dynamic Energy Exploration & Production Portfolio | 188,934,409 | 186,549,986 | ||||||
Dynamic Food & Beverage Portfolio | 417,618,464 | 257,699,232 | ||||||
Dynamic Leisure and Entertainment Portfolio | 250,487,682 | 179,627,593 | ||||||
Dynamic Media Portfolio | 437,626,783 | 455,202,333 | ||||||
Dynamic Networking Portfolio | 15,966,249 | 22,952,236 | ||||||
Dynamic Oil & Gas Services Portfolio | 89,519,112 | 97,742,352 | ||||||
Dynamic Pharmaceuticals Portfolio | 643,598,853 | 266,767,436 | ||||||
Dynamic Retail Portfolio | 52,518,916 | 56,899,811 | ||||||
Dynamic Semiconductors Portfolio | 20,753,283 | 21,989,602 | ||||||
Dynamic Software Portfolio | 50,412,570 | 51,468,814 |
Gains (losses) on in-kind transactions are generally not considered taxable gains (losses) for federal income tax purposes.
At April 30, 2014, the aggregate cost and the net unrealized appreciation (depreciation) of investments for tax purposes were as follows:
Cost | Net Unrealized Appreciation (Depreciation) | Gross Unrealized Appreciation | Gross Unrealized (Depreciation) | |||||||||||||
Dynamic Biotechnology & Genome Portfolio | $ | 382,653,309 | $ | 17,217,938 | $ | 39,324,150 | $ | (22,106,212 | ) | |||||||
Dynamic Building & Construction Portfolio | 117,308,237 | 6,464,553 | 11,176,320 | (4,711,767 | ) | |||||||||||
Dynamic Energy Exploration & Production Portfolio | 116,727,664 | 13,644,046 | 14,386,827 | (742,781 | ) | |||||||||||
Dynamic Food & Beverage Portfolio | 417,948,647 | 16,384,028 | 27,566,101 | (11,182,073 | ) | |||||||||||
Dynamic Leisure and Entertainment Portfolio | 177,848,809 | 235,988 | 9,457,537 | (9,221,549 | ) | |||||||||||
Dynamic Media Portfolio | 177,827,947 | (6,229,290 | ) | 5,055,572 | (11,284,862 | ) | ||||||||||
Dynamic Networking Portfolio | 26,061,065 | 3,640,116 | 5,009,188 | (1,369,072 | ) | |||||||||||
Dynamic Oil & Gas Services Portfolio | 118,474,169 | 17,530,051 | 19,877,512 | (2,347,461 | ) | |||||||||||
Dynamic Pharmaceuticals Portfolio | 970,909,248 | 191,188,182 | 199,789,562 | (8,601,380 | ) | |||||||||||
Dynamic Retail Portfolio | 25,020,790 | (109,330 | ) | 1,149,879 | (1,259,209 | ) | ||||||||||
Dynamic Semiconductors Portfolio | 18,280,047 | 2,385,064 | 2,585,792 | (200,728 | ) | |||||||||||
Dynamic Software Portfolio | 55,292,280 | (911,072 | ) | 3,603,449 | (4,514,521 | ) |
Note 7. Reclassification of Permanent Differences
Primarily as a result of differing book/tax treatment of in-kind transactions on April 30, 2014, amounts were reclassified between undistributed net investment income (loss), undistributed net realized gain (loss) and shares of beneficial interest. These reclassifications had no effect on the net assets of each Fund. For the fiscal year ended April 30, 2014, the reclassifications were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Net Realized Gain (Loss) | Shares of Beneficial Interest | ||||||||||
Dynamic Biotechnology & Genome Portfolio | $ | — | $ | (84,982,657 | ) | $ | 84,982,657 | |||||
Dynamic Building & Construction Portfolio | 18,851 | (15,547,741 | ) | 15,528,890 | ||||||||
Dynamic Energy Exploration & Production Portfolio | 450,526 | (22,848,644 | ) | 22,398,118 | ||||||||
Dynamic Food & Beverage Portfolio | — | (30,353,994 | ) | 30,353,994 | ||||||||
Dynamic Leisure and Entertainment Portfolio | (8,132 | ) | (25,041,275 | ) | 25,049,407 | |||||||
Dynamic Media Portfolio | — | (68,941,619 | ) | 68,941,619 | ||||||||
Dynamic Networking Portfolio | 22,948 | (5,335,735 | ) | 5,312,787 | ||||||||
Dynamic Oil & Gas Services Portfolio | 172,894 | (6,980,238 | ) | 6,807,344 |
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Undistributed Net Investment Income (Loss) | Undistributed Net Realized Gain (Loss) | Shares of Beneficial Interest | ||||||||||
Dynamic Pharmaceuticals Portfolio | $ | — | $ | (123,752,877 | ) | $ | 123,752,877 | |||||
Dynamic Retail Portfolio | — | (7,731,042 | ) | 7,731,042 | ||||||||
Dynamic Semiconductors Portfolio | — | (4,109,768 | ) | 4,109,768 | ||||||||
Dynamic Software Portfolio | (15,937 | ) | (12,603,595 | ) | 12,619,532 |
Note 8. Trustees’ and Officer’s Fees
Trustees’ and Officer’s Fees include amounts accrued by the Funds to pay remuneration to the Independent Trustees and Officer of the Funds. The Trustee who is an “interested person” (the “Non-Independent Trustee”) of the Trust does not receive any Trustees’ fees.
The Trust has adopted a deferred compensation plan (the “Plan”). Under the Plan, an Independent Trustee who has executed a Deferred Fee Agreement (a “Participating Trustee”) may defer receipt of all or a portion of his compensation (“Deferral Fees”). Such Deferral Fees are deemed to be invested in select PowerShares Funds. The Deferral Fees payable to the Participating Trustee are valued as of the date such Deferral Fees would have been paid to the Participating Trustee. The value increases with contributions or with increases in the value of the Shares selected, and the value decreases with distributions or with declines in the value of the Shares selected. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Funds.
Note 9. Capital
Shares are created and redeemed by each Fund only in Creation Units of 50,000 Shares. Only Authorized Participants are permitted to purchase or redeem Creation Units from the Funds. Such transactions are generally permitted in exchange for Deposit Securities, with a balancing cash component to equate the transaction to the NAV per Share of a Fund of the Trust on the transaction date. However, for all Funds, cash in an amount equivalent to the value of certain securities may be substituted, generally when the securities are not available in sufficient quantity for delivery, not eligible for trading by the Authorized Participant or as a result of other market circumstances.
To the extent that the Funds permit transactions in exchange for Deposit Securities, each Fund may issue Shares in advance of receipt of Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to 105% of the market value of the missing Deposit Securities. In accordance with each Fund’s Participant Agreement, Creation Units will be issued to an Authorized Participant, notwithstanding the fact that the corresponding Deposit Securities have not been received in part or in whole, in reliance on the undertaking of the Authorized Participant to deliver the missing Deposit Securities as soon as possible, which undertaking shall be secured by the Authorized Participant’s delivery and maintenance of collateral consisting of cash in the form of U.S. dollars in immediately available funds having a value (marked-to-market daily) at least equal to 105%, which the Adviser may change from time to time, of the value of the missing Deposit Securities.
Transactions in each Fund’s Shares are disclosed in detail in the Statements of Changes in Net Assets.
Note 10. Indemnifications
Under the Trust’s organizational documents, its officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Each Independent Trustee is also indemnified against certain liabilities arising out of the performance of his duties to the Trust pursuant to an Indemnification Agreement between the Independent Trustee and the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
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Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Networking Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Dynamic Semiconductors Portfolio and PowerShares Dynamic Software Portfolio (each an individual portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the “Funds”) at April 30, 2014, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2014 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Chicago, IL
June 24, 2014
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As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur advisory fees and other Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2014.
Actual Expenses
The first line in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following table provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as sales charges and brokerage commissions. Therefore, the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares Dynamic Biotechnology & Genome Portfolio (PBE) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,131.34 | 0.59 | % | $ | 3.12 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.87 | 0.59 | 2.96 | ||||||||||||
PowerShares Dynamic Building & Construction Portfolio (PKB) | ||||||||||||||||
Actual | 1,000.00 | 1,061.51 | 0.63 | 3.22 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) | ||||||||||||||||
Actual | 1,000.00 | 1,142.01 | 0.63 | 3.35 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares Dynamic Food & Beverage Portfolio (PBJ) | ||||||||||||||||
Actual | 1,000.00 | 1,039.84 | 0.60 | 3.03 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.82 | 0.60 | 3.01 | ||||||||||||
PowerShares Dynamic Leisure and Entertainment Portfolio (PEJ) | ||||||||||||||||
Actual | 1,000.00 | 980.82 | 0.63 | 3.09 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares Dynamic Media Portfolio (PBS) | ||||||||||||||||
Actual | 1,000.00 | 991.02 | 0.62 | 3.06 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.72 | 0.62 | 3.11 | ||||||||||||
PowerShares Dynamic Networking Portfolio (PXQ) | ||||||||||||||||
Actual | 1,000.00 | 1,061.24 | 0.63 | 3.22 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 |
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Fees and Expenses (continued)
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares Dynamic Oil & Gas Services Portfolio (PXJ) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,070.71 | 0.60 | % | $ | 3.08 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.82 | 0.60 | 3.01 | ||||||||||||
PowerShares Dynamic Pharmaceuticals Portfolio (PJP) | ||||||||||||||||
Actual | 1,000.00 | 1,205.06 | 0.58 | 3.17 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.92 | 0.58 | 2.91 | ||||||||||||
PowerShares Dynamic Retail Portfolio (PMR) | ||||||||||||||||
Actual | 1,000.00 | 963.77 | 0.63 | 3.07 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares Dynamic Semiconductors Portfolio (PSI) | ||||||||||||||||
Actual | 1,000.00 | 1,159.73 | 0.63 | 3.37 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares Dynamic Software Portfolio (PSJ) | ||||||||||||||||
Actual | 1,000.00 | 1,009.53 | 0.63 | 3.14 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 |
(1) | Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six-month period ended April 30, 2014. Expenses are calculated by multiplying the Fund’s annualized expense ratio by the average account value of the period, then multiplying the result by 181/365. Expense ratios for the most recent half-year may differ from expense ratios based on annualized data in the Financial Highlights. |
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Qualified Dividend Income* | Dividends-received Deduction* | |||||||||
Dynamic Biotechnology & Genome Portfolio | 0 | % | 0 | % | ||||||
Dynamic Building & Construction Portfolio | 0 | % | 0 | % | ||||||
Dynamic Energy Exploration & Production Portfolio | 100 | % | 100 | % | ||||||
Dynamic Food & Beverage Portfolio | 100 | % | 100 | % | ||||||
Dynamic Leisure and Entertainment Portfolio | 100 | % | 100 | % | ||||||
Dynamic Media Portfolio | 100 | % | 100 | % | ||||||
Dynamic Networking Portfolio | 100 | % | 100 | % | ||||||
Dynamic Oil & Gas Services Portfolio | 100 | % | 100 | % | ||||||
Dynamic Pharmaceuticals Portfolio | 100 | % | 100 | % | ||||||
Dynamic Retail Portfolio | 100 | % | 100 | % | ||||||
Dynamic Semiconductors Portfolio | 100 | % | 100 | % | ||||||
Dynamic Software Portfolio | 0 | % | 0 | % |
* | The above percentages are based on ordinary income dividends paid to shareholders during the Fund’s fiscal year. |
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The Independent Trustees, the Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by each Trustee are shown below.
The Trustees and officers information is current as of April 30, 2014.
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Ronn R. Bagge (1958) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Founder and Principal, YQA Capital Management LLC (1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider). | 114 | None | |||||
Todd J. Barre (1957) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2010 | Assistant Professor of Business, Trinity Christian College (2010-Present); formerly Vice President and Senior Investment Strategist (2001-2008), Director of Open Architecture and Trading (2007-2008), Head of Fundamental Research (2004-2007) and Vice President and Senior Fixed Income Strategist (1994-2001), BMO Financial Group/Harris Private Bank. | 114 | None | |||||
Marc M. Kole (1960) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2006 | Chief Financial Officer, Hope Network (social services) (2008-2012); formerly, Assistant Vice President and Controller, Priority Health (health insurance) (2005-2008); Senior Vice President of Finance, United Healthcare (2004-2005); Senior Vice President of Finance, Oxford Health Plans (2000-2004). | 114 | None | |||||
Yung Bong Lim (1964) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Managing Partner, Residential Dynamics Group LLC (2008-Present); formerly, Managing Director, Citadel Investment Group, L.L.C. (1999-2007). | 114 | None | |||||
Philip M. Nussbaum (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (2004-Present). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Gary R. Wicker (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Senior Vice President of Global Finance and Chief Financial Officer at RBC Ministries (publishing company) (2013-Present); formerly, Executive Vice President and Chief Financial Officer, Zondervan Publishing (a division of Harper Collins/NewsCorp) (2007-2012); Senior Vice President and Group Controller (2005-2006), Senior Vice President and Chief Financial Officer (2003-2004), Chief Financial Officer (2001-2003), Vice President, Finance and Controller (1999-2001) and Assistant Controller (1997-1999), divisions of The Thomson Corporation (information services provider). | 114 | None | |||||
Donald H. Wilson (1959) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Chairman of the Board and Trustee | Chairman since 2012; Trustee since 2006 | Chairman, President and Chief Executive Officer, Community Financial Shares, Inc. and Community Bank—Wheaton/Glen Ellyn (subsidiary) (2013-Present); Chairman and Chief Executive Officer, Stone Pillar Advisers, Ltd. (2010-Present); formerly, Chief Operating Officer, AMCORE Financial, Inc. (bank holding company) (2007-2009); Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (2006-2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (1995-2006). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
The Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by the Non-Independent Trustee and the other directorships, if any, held by the Non-Independent Trustee are shown below.
Name, Address and Age of Non-Independent Trustee | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Non-Independent Trustee | Other Directorships Held by Non-Independent Trustee During the Past 5 Years | |||||
Kevin M. Carome (1956) Invesco Ltd. Two Peachtree Pointe 1555 Peachtree St., N.E., Suite 1800 Atlanta, GA 30309 | Trustee | Since 2010 | Senior Managing Director, Secretary and General Counsel, Invesco Ltd. (2006-Present); Director, Invesco Advisers, Inc. (2009-Present); Director, Invesco Advisers, Inc., Invesco Finance PLC, INVESCO Funds Group, Inc., and Invesco Holding Company Limited; Director and Executive Vice President, Invesco Finance, Inc., Invesco Group Services, Inc., Invesco Investments (Bermuda) Ltd., Invesco North American Holdings, Inc., and IVZ, Inc.; Director and Secretary, IVZ Bahamas Private Limited; formerly, Senior Vice President, Secretary and General Counsel, Invesco Advisers, Inc. (2003-2005); Senior Vice President and General Counsel, Liberty Financial Companies, Inc. (2000-2001); General Counsel of certain investment management subsidiaries of Liberty Financial Companies, Inc. (1998-2000); Associate General Counsel, Liberty Financial Companies, Inc. (1993-1998); Associate, Ropes & Gray LLP. | 114 | None |
* | This is the date the Non-Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Andrew Schlossberg (1974) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046 | President | Since 2009 | Director, Invesco Distributors, Inc. (2012-Present); Managing Director—U.S. Strategy and Marketing, Invesco PowerShares Capital Management LLC (2010-Present); Managing Director, U.S. head of business strategy and chief marketing officer for Invesco Ltd. in the United States (2008-Present); Director, Invesco Distributors, Inc. (2012-Present); and Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present); formerly, Mr. Schlossberg served in multiple roles within Invesco, including head of corporate development, as well as global leadership roles in strategy and product development in the company’s North American Institutional and Retirement divisions (2002-2007). | |||
Peter Hubbard (1981) Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2009 | Vice President and Director of Portfolio Management—Invesco PowerShares Capital Management LLC (2008-Present); formerly, Portfolio Manager, Invesco PowerShares Capital Management LLC (2007-2008); Research Analyst, Invesco PowerShares Capital Management LLC (2005-2007); Research Analyst and Trader, Ritchie Capital, a hedge fund operator (2003-2005). | |||
David Warren (1957) Invesco Canada Ltd. 5140 Yonge Street Suite 900, Toronto, Ontario M2N 6X7 | Vice President | Since 2009 | Managing Director—Chief Administrative Officer, Americas, Invesco PowerShares Capital Management LLC; Senior Vice President, Invesco Advisers, Inc. (2009–Present); Director, Executive Vice President and Chief Financial Officer, Invesco Inc. (2009–Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) and Chief Administrative Officer, North American Retail, Invesco Ltd. (2007-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Invesco Canada Holdings Inc. (2002–Present), Invesco Corporate Class Inc., and Invesco Canada Fund Inc.; Director, Executive Vice President and Chief Financial Officer, Invesco, Inc.; formerly, Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) (2000-2006). | |||
Sheri Morris (1964) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Vice President | Since 2012 | Vice President, Treasurer and Principal Financial Officer, The Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present) and Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; formerly, Treasurer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc. | |||
Rudolf E. Reitmann (1971) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global Exchange Traded Funds Operations, Invesco PowerShares Capital Management LLC (since 2013). |
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Daniel E. Draper (1968) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Senior Vice President, Invesco Distributors, Inc. (since 2014); Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Managing Director, Invesco PowerShares Global ETFs (since 2013); formerly, Managing Director, Credit Suisse Asset Management (2010-2013) and Lyxor Asset Management/Societe Generale (2007-2010). | |||
Steven M. Hill (1964) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President and Treasurer | Since 2013 | Vice President and Treasurer of PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global ETF Administration, Invesco PowerShares Capital Management LLC (since 2011); formerly, Senior Managing Director and Chief Financial Officer, Destra Capital Management LLC and its subsidiaries (2010-2011); Chief Financial Officer, Destra Investment Trust and Destra Investment Trust II (2010-2011); Senior Managing Director, Claymore Securities, Inc. (2003-2010); and Chief Financial Officer, Claymore sponsored mutual funds (2003-2010). | |||
Christopher Joe (1969) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Chief Compliance Officer | Since 2012 | U.S. Compliance Director, Invesco, Ltd. (since 2006); formerly, Chief Compliance Officer, Invesco Investment Advisers, LLC (registered investment adviser) (2010-2013); formerly, Assistant Fund Accounting Manager, Invesco, Ltd. (1998-1999). | |||
Anna Paglia (1974) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Secretary | Since 2011 | Secretary, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (2011-Present); Head of Legal, Invesco PowerShares Capital Management LLC (2010-Present); formerly, Partner, K&L Gates LLP (formerly, Bell Boyd & Lloyd LLP) (2007-2010); Associate Counsel at Barclays Global Investors Ltd. (2004-2006). |
Availability of Additional Information About the Trustees
The Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request at (800) 983-0903.
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for the following 51 series (each, a “Fund” and collectively, the “Funds”):
PowerShares Aerospace & Defense Portfolio
PowerShares BuyBack Achievers™ Portfolio
PowerShares Cleantech™ Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares DWA Momentum Portfolio
PowerShares DWA Basic Materials Momentum Portfolio
PowerShares DWA Consumer Cyclicals Momentum Portfolio
PowerShares DWA Consumer Staples Momentum Portfolio
PowerShares DWA Energy Momentum Portfolio
PowerShares DWA Financial Momentum Portfolio
PowerShares DWA Healthcare Momentum Portfolio
PowerShares DWA Industrials Momentum Portfolio
PowerShares DWA NASDAQ Momentum Portfolio
PowerShares DWA Technology Momentum Portfolio
PowerShares DWA Utilities Momentum Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Building & Construction Portfolio
PowerShares Dynamic Energy Exploration & Production Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Market Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Oil & Gas Services Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Financial Preferred Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares Fundamental Pure Large Core Portfolio
PowerShares Fundamental Pure Large Growth Portfolio
PowerShares Fundamental Pure Large Value Portfolio
PowerShares Fundamental Pure Mid Core Portfolio
PowerShares Fundamental Pure Mid Growth Portfolio
PowerShares Fundamental Pure Mid Value Portfolio
PowerShares Fundamental Pure Small Core Portfolio
PowerShares Fundamental Pure Small Growth Portfolio
PowerShares Fundamental Pure Small Value Portfolio
PowerShares Global Listed Private Equity Portfolio
PowerShares Golden Dragon China Portfolio
PowerShares High Yield Equity Dividend Achievers TM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares S&P 500® High Quality Portfolio
PowerShares Water Resources Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares WilderHill Progressive Energy Portfolio
PowerShares Zacks Micro Cap Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year, ten-year and since-inception periods ended December 31, 2013, as applicable, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
explanations for any tracking error. The Trustees noted that for each applicable period the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s advisory fee and net expense ratio, as compared to information compiled by the Adviser from Lipper Inc. databases on the advisory fees and net expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual advisory fee charged to each Fund is:
— | 0.50% of the Fund’s average daily net assets for each Fund other than PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend AchieversTM Portfolio, PowerShares International Dividend AchieversTM Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio; |
— | 0.40% of the Fund’s average daily net assets for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; and |
— | 0.29% of the Fund’s average daily net assets for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio. |
The Trustees also noted that the Adviser has agreed to waive a portion of its advisory fee and/or pay expenses (an “Expense Cap”) to the extent necessary to prevent the annual operating expenses of each Fund from exceeding the percentage of that Fund’s average daily net assets, at least until August 31, 2015, as set forth below:
— | 0.60%, excluding interest expenses, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares DWA NASDAQ Momentum Portfolio and PowerShares Dynamic Market Portfolio; |
— | 0.50%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; |
— | 0.39%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio and PowerShares Fundamental Pure Small Value Portfolio; |
— | 0.29%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares S&P 500® High Quality Portfolio; |
— | 0.60%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio and PowerShares DWA Utilities Momentum Portfolio (the Trustees noted that prior to December 17, 2013, licensing fees were excluded from the Expense Cap); and |
— | 0.60%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each other Fund. |
The Trustees noted that the Adviser represented that it does not serve as the investment adviser to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds, but that the Adviser provides sub-advisory services to clients with comparable investment strategies as certain of the Funds. The Trustees further noted the Adviser’s explanation with respect to the sub-advisory fees it receives for such services in comparison to the advisory fees charged to the Funds. The Trustees noted that each Fund’s advisory fee was:
— | higher than the median advisory fee of its ETF peer funds (except for the advisory fee of each of PowerShares Financial Preferred Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio and PowerShares International Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its ETF peer funds); and |
— | higher than the median advisory fee of its open-end index peer funds (except for the advisory fee of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares High Yield Equity Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median advisory fee of its open-end actively-managed peer funds. |
The Trustees determined that the advisory fees were reasonable, noting the complexity of the indexes, the distinguishing factors of the Funds, and the administrative, operational and management oversight costs for the Adviser. With respect to the Funds’ net expense ratios, the Trustees noted that the net expense ratio for each Fund was:
— | higher than the median net expense ratio of its ETF peer funds (except for the net expense ratio of each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers Portfolio and PowerShares S&P 500® High Quality Portfolio, which was equal to or less than the median net expense ratio of its ETF peer funds); and |
— | higher than the median net expense ratio of its open-end index peer funds (except for the net expense ratio of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio, PowerShares DWA Utilities Momentum Portfolio, PowerShares Dynamic Large Cap Growth Portfolio, PowerShares Dynamic Networking Portfolio, PowerShares Dynamic Semiconductors Portfolio, PowerShares Dynamic Software Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares High Yield Equity |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Dividend Achievers™ Portfolio and PowerShares S&P 500® High Quality Portfolio, which was lower than the median net expense ratio of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median net expense ratio of its open-end actively-managed peer funds. |
The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds, and noted those Funds for which license fees are included in the Funds’ Expense Caps.
The Board concluded that the advisory fee and expense ratio of each Fund (giving effect to the Fund’s Expense Cap) were reasonable and appropriate in light of the services provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to any of the Funds was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size, expense ratio and expense limitation agreed to by the Adviser. The Trustees noted that, for Funds whose expenses are higher than their respective Expense Caps, any reduction in that Fund’s expenses would be enjoyed by the Adviser, but that Fund shareholders benefit from the lower expense ratio as a result of the Fund’s Expense Cap. The Trustees also noted that the Excess Expense Agreement with the Trust provides that the Adviser is entitled to be reimbursed by each Fund, other than PowerShares Dynamic Market Portfolio and PowerShares DWA NASDAQ Momentum Portfolio, for fees waived or expenses absorbed pursuant to the Expense Cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its Expense Cap. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate, noting the Fund expenses the Adviser has borne as a result of the Expense Cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
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Proxy Voting Policies and Procedures
A description of the Trust’s proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 983-0903. This information is also available on the Securities and Exchange Commission’s (“Commission”) website at www.sec.gov.
Information regarding how each Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 983-0903; or (ii) accessing the Trust’s Form N-PX on the Commission’s website at www.sec.gov.
Quarterly Portfolios
The Trust files its complete schedule of portfolio holdings for the Funds with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Trust’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Trust’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
Frequency Distribution of Discounts and Premiums
A table showing the number of days the market price of each Fund’s shares was greater than the Fund’s net asset value, and the number of days it was less than the Fund’s net asset value (i.e., premium or discount) for the most recently completed calendar year, and the calendar quarters since that year end (or the life of the Fund, if shorter) may be found at the Fund’s website at www.invescopowershares.com.
©2014 Invesco PowerShares Capital Management LLC | P-PS-AR-7 | |||||
3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | ||||||
invescopowershares.com 800.983.0903 | @PowerShares |
April 30, 2014 |
2014 Annual Report to Shareholders
PYZ | PowerShares DWA Basic Materials Momentum Portfolio | |
(formerly PowerShares Dynamic Basic Materials Sector Portfolio) | ||
PEZ | PowerShares DWA Consumer Cyclicals Momentum Portfolio | |
(formerly PowerShares Dynamic Consumer Discretionary Sector Portfolio) | ||
PSL | PowerShares DWA Consumer Staples Momentum Portfolio | |
(formerly PowerShares Dynamic Consumer Staples Sector Portfolio) | ||
PXI | PowerShares DWA Energy Momentum Portfolio | |
(formerly PowerShares Dynamic Energy Sector Portfolio) | ||
PFI | PowerShares DWA Financial Momentum Portfolio | |
(formerly PowerShares Dynamic Financial Sector Portfolio) | ||
PTH | PowerShares DWA Healthcare Momentum Portfolio | |
(formerly PowerShares Dynamic Healthcare Sector Portfolio) | ||
PRN | PowerShares DWA Industrials Momentum Portfolio | |
(formerly PowerShares Dynamic Industrials Sector Portfolio) | ||
PTF | PowerShares DWA Technology Momentum Portfolio | |
(formerly PowerShares Dynamic Technology Sector Portfolio) | ||
PUI | PowerShares DWA Utilities Momentum Portfolio | |
(formerly PowerShares Dynamic Utilities Portfolio) | ||
PNQI | PowerShares NASDAQ Internet Portfolio |
The Market Environment | 3 | |||
Manager’s Analysis | 4 | |||
Sector Portfolios | ||||
Schedules of Investments | ||||
34 | ||||
35 | ||||
36 | ||||
37 | ||||
38 | ||||
39 | ||||
40 | ||||
41 | ||||
PowerShares DWA Utilities Momentum Portfolio (PUI) | 42 | |||
43 | ||||
Statements of Assets and Liabilities | 46 | |||
Statements of Operations | 48 | |||
Statements of Changes in Net Assets | 50 | |||
Financial Highlights | 54 | |||
Notes to Financial Statements | 59 | |||
Report of Independent Registered Public Accounting Firm | 69 | |||
Fees and Expenses | 70 | |||
Tax Information | 72 | |||
Trustees and Officers | 73 | |||
Board Considerations Regarding Continuation of Investment Advisory Agreement | 78 |
| 2 |
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Domestic Equity
The U.S. equity market rose to multiyear or all-time highs during the fiscal year ended April 30, 2014.1 Corporate earnings were resilient in the face of modest economic growth, driven by strong profitability across many sectors, and fundamentals for corporations and consumers remained relatively stable following significant recovery in prior years.
However, the fiscal year began with capital markets in the U.S. declining. In May and June 2013, equity and fixed income markets fell following then-U.S. Federal Reserve (the “Fed”) Chairman Ben Bernanke’s comments suggesting that the time was approaching to reduce, or “taper,” the size of its bond buying economic stimulus program. This sell-off was brief but broad, and few asset classes were immune. Markets stabilized in mid-summer and generally rose, with some brief interruptions, through the end of 2013. The Fed’s announcement in December that tapering of its bond purchases would begin in early 2014 had little effect on equities as the announcement was widely anticipated. After strong performance in the second half of 2013, the U.S. equity market turned volatile in the first four months of 2014 as investors worried that stocks may have risen too high, too fast in 2013. Adding to this investor uncertainty during 2014 was political upheaval in Ukraine and signs of economic sluggishness in the U.S. and China.
1 | Source: Reuters |
| 3 |
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PYZ | Manager’s Analysis | |
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Basic Materials Sector Portfolio to PowerShares DWA Basic Materials Momentum Portfolio and the underlying index changed from Dynamic Basic Materials Sector IntellidexSM Index to DWA Basic Materials Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Basic Materials Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Basic Materials Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The basic materials companies that comprise the Index are principally engaged in the business of producing raw materials, including paper or wood products, chemicals, construction materials, and mining and metals.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the basic materials sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 22.18%. On a net asset value (“NAV”) basis, the Fund returned 21.97%. During the same time period, the Blended-DWA Basic Materials Technical LeadersTM Index returned 22.77%, while the Dynamic Basic Materials Sector IntellidexSM Index, the Fund’s previous underlying index, returned 22.06%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Materials Index (the “Benchmark Index”) returned 23.49%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 30 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of other indices similar to the Index. The Benchmark Index was selected for its recognition in the marketplace as well as its shared exposure to the materials sector.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the specialty chemicals sub-industry and most underweight in the diversified chemicals sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during the period can be attributed to these sub-industry allocations.
For the fiscal year ended April 30, 2014, the specialty chemicals sub-industry contributed most significantly to the Fund’s return, followed by the diversified chemicals and paper products sub-industries, respectively. The agricultural chemicals and construction materials sub-industries detracted most significantly from the Fund’s return.
Positions that contributed most significantly to the Fund’s return included Westlake Chemical Corp., a commodity chemicals company (portfolio average weight of 2.49%) and Hi-Crush Partners L.P., a diversified metals & mining company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Mosaic Co., a fertilizers & agricultural chemicals company (no longer held at fiscal year-end); and Rentech Nitrogen Partners, L.P., a fertilizers & agricultural chemicals company (no longer held at fiscal year-end).
| 4 |
|
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Specialty Chemicals | 41.4 | |||
Diversified Chemicals | 16.9 | |||
Commodity Chemicals | 10.3 | |||
Industrial Gases | 7.1 | |||
Paper Products | 5.7 | |||
Diversified Metals & Mining | 4.0 | |||
Steel | 3.0 | |||
Aluminum | 2.7 | |||
Fertilizers & Agricultural Chemicals | 2.2 | |||
Aerospace & Defense | 1.7 | |||
Life Sciences Tools & Services | 1.5 | |||
Oil & Gas Refining & Marketing | 1.5 | |||
Electronic Components | 1.0 | |||
Gold | 1.0 | |||
Money Market Funds Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Westlake Chemical Corp. | 4.8 | |||
W.R. Grace & Co. | 4.3 | |||
FMC Corp. | 4.1 | |||
Rockwood Holdings, Inc. | 4.1 | |||
Airgas, Inc. | 3.9 | |||
LyondellBasell Industries NV, Class A | 3.8 | |||
Ashland, Inc. | 3.6 | |||
Huntsman Corp. | 3.6 | |||
Praxair, Inc. | 3.2 | |||
Eastman Chemical Co. | 3.1 | |||
Total | 38.5 |
| 5 |
|
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Basic Materials Technical LeadersTM Index†† | 22.77 | % | 11.08 | % | 37.06 | % | 23.88 | % | 191.80 | % | 12.52 | % | 143.66 | % | ||||||||||||||||
DWA Basic Materials Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Basic Materials Sector IntellidexSM Index†† | 22.06 | 10.86 | 36.26 | 23.74 | 190.11 | 12.44 | 142.25 | |||||||||||||||||||||||
S&P 500® Materials Index | 23.49 | 8.17 | 26.57 | 16.82 | 117.53 | 7.90 | 77.59 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 21.97 | 10.25 | 34.01 | 22.95 | 180.91 | 11.54 | 127.98 | |||||||||||||||||||||||
Market Price Return | 22.18 | 10.23 | 33.93 | 22.92 | 180.67 | 11.54 | 127.97 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.72%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Basic Materials Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Basic Materials Technical LeadersTM Index performance is comprised of the performance of the Dynamic Basic Materials Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 6 |
|
PEZ | Manager’s Analysis | |
PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Consumer Discretionary Sector Portfolio to PowerShares DWA Consumer Cyclicals Momentum Portfolio and the underlying index changed from Dynamic Consumer Discretionary Sector IntellidexSM Index to DWA Consumer Cyclicals Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Consumer Cyclicals Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Consumer Cyclicals Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The consumer cyclicals companies that comprise the Index are principally engaged in the businesses of providing consumer goods and services that are cyclical in nature, including retail, automotive, leisure and recreation, media and real estate goods and services.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the consumer cyclicals sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities
representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 16.93%. On a net asset value (“NAV”) basis, the Fund returned 16.97%. During the same time period, the Blended-DWA Consumer Cyclicals Technical LeadersTM Index returned 17.76%, while the Dynamic Consumer Discretionary Sector IntellidexSM Index, the Fund’s previous underlying index, returned 18.80%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Consumer Discretionary Index (the “Benchmark Index”) returned 18.76%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 85 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of other indices similar to the Index as well as to that of the broader-based market benchmarks. The Benchmark Index was selected for its recognition in the marketplace and its shared exposure to the consumer discretionary sector.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the auto parts & equipment sub-industry and most underweight in the movies & entertainment sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the restaurant sub-industry contributed most significantly to the Fund’s return, followed by the cable & satellite and movies & entertainment sub-industries, respectively. The Internet retail sub-industry detracted most significantly followed by the homebuilding and the Internet software & services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included DISH Network Corp., Class A, a cable & satellite company (no longer held at fiscal year-end) and Viacom Inc., Class B, a movies & entertainment company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Pandora, an Internet software & services company (portfolio average weight of 0.45%); and Netflix, Inc., an Internet retail company (portfolio average weight of 0.95%).
| 7 |
|
PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Internet Retail | 13.9 | |||
Restaurants | 10.8 | |||
Auto Parts & Equipment | 8.0 | |||
Apparel, Accessories & Luxury Goods | 7.5 | |||
Automotive Retail | 6.3 | |||
Airlines | 5.7 | |||
Specialty Stores | 5.6 | |||
Internet Software & Services | 4.2 | |||
Casinos & Gaming | 4.1 | |||
Broadcasting | 4.0 | |||
Automobile Manufacturers | 3.7 | |||
Drug Retail | 3.7 | |||
Apparel Retail | 3.6 | |||
Leisure Products | 2.9 | |||
Homefurnishing Retail | 2.5 | |||
Cable & Satellite | 2.3 | |||
Construction Machinery & Heavy Trucks | 2.1 | |||
Trucking | 2.1 | |||
Department Stores | 2.0 | |||
Food Retail | 1.8 | |||
Industrial Machinery | 1.4 | |||
General Merchandise Stores | 0.9 | |||
Movies & Entertainment | 0.9 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Priceline Group, Inc. (The) | 7.4 | |||
TRW Automotive Holdings Corp. | 7.1 | |||
O’Reilly Automotive, Inc. | 6.3 | |||
Domino’s Pizza, Inc. | 4.2 | |||
VF Corp. | 3.8 | |||
Tesla Motors, Inc. | 3.7 | |||
Rite Aid Corp. | 3.7 | |||
TJX Cos., Inc. (The) | 3.6 | |||
Amazon.com, Inc. | 3.4 | |||
CBS Corp., Class B | 3.2 | |||
Total | 46.4 |
| 8 |
|
PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Consumer Cyclicals Technical LeadersTM Index†† | 17.76 | % | 14.79 | % | 51.26 | % | 20.12 | % | 150.12 | % | 7.53 | % | 73.00 | % | ||||||||||||||||
DWA Consumer Cyclicals Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Consumer Discretionary Sector IntellidexSM Index†† | 18.80 | 15.13 | 52.61 | 20.34 | 152.35 | 7.66 | 74.54 | |||||||||||||||||||||||
S&P 500® Consumer Discretionary Index | 18.76 | 18.34 | 65.73 | 24.44 | 198.46 | 9.40 | 97.11 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 16.97 | 13.97 | 48.03 | 19.26 | 141.21 | 6.89 | 65.36 | |||||||||||||||||||||||
Market Price Return | 16.93 | 13.93 | 47.90 | 19.22 | 140.90 | 6.88 | 65.21 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.93%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Consumer Cyclicals Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Consumer Cyclicals Technical LeadersTM Index performance is comprised of the performance of the Dynamic Consumer Discretionary Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 9 |
|
PSL | Manager’s Analysis | |
PowerShares DWA Consumer Staples Momentum Portfolio (PSL) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Consumer Staples Sector Portfolio to PowerShares DWA Consumer Staples Momentum Portfolio and the underlying index changed from Dynamic Consumer Staples Sector IntellidexSM Index to DWA Consumer Staples Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Consumer Staples Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Consumer Staples Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The consumer staples companies that comprise the Index are principally engaged in the businesses of providing consumer goods and services that have non-cyclical characteristics, including tobacco, textiles, food and beverage, and non-discretionary retail goods and services.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the consumer staples sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities
representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 9.97%. On a net asset value (“NAV”) basis, the Fund returned 9.93%. During the same time period, the Blended-DWA Consumer Staples Technical LeadersTM Index returned 10.67%, while the Dynamic Consumer Staples Sector IntellidexSM Index, the Fund’s previous underlying index, returned 16.79%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Consumer Staples Index (the “Benchmark Index”) returned 10.46%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 40 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of other indices similar to the Index.
The Benchmark Index was selected for its recognition in the marketplace and its shared exposure to the consumer staples sector. The performance of the Fund differed slightly from the Benchmark Index primarily due to fees and operating expenses that the Fund incurred during the period. Additionally, the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization.
For the fiscal year ended April 30, 2014, the packaged foods and meats sub-industry contributed most significantly to the Fund’s return, followed by the drug retail sub-industry. The Internet software and services sub-industry was the most significantly detracting sub-industry, followed by the education services and specialized consumer services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Rite Aid Corp., a drug retail company (no longer held at fiscal year-end) and Pilgrim’s Pride Corp., a packaged foods & meats company (portfolio average weight of 1.41%). Positions that detracted most significantly from the Fund’s return included Yelp Inc., Class A, an internet software & services company (portfolio average weight of 0.25%); and Apollo Education Group, Inc., Class A, an education services company (portfolio average weight of 0.16%).
| 10 |
|
PowerShares DWA Consumer Staples Momentum Portfolio (PSL) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Packaged Foods & Meats | 28.9 | |||
Education Services | 9.2 | |||
Housewares & Specialties | 7.2 | |||
Soft Drinks | 6.8 | |||
Specialized Consumer Services | 6.3 | |||
Household Products | 6.0 | |||
Distillers & Vintners | 5.3 | |||
Trading Companies & Distributors | 4.4 | |||
Food Retail | 4.1 | |||
Food Distributors | 3.6 | |||
Internet Software & Services | 2.7 | |||
Personal Products | 2.7 | |||
Home Furnishings | 2.3 | |||
Industrial Machinery | 1.9 | |||
Diversified Support Services | 1.6 | |||
Trucking | 1.5 | |||
Distributors | 1.4 | |||
Environmental & Facilities Services | 1.4 | |||
Health Care Facilities | 1.4 | |||
Household Appliances | 1.1 | |||
Data Processing & Outsourced Services | 0.3 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.1) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
United Rentals, Inc. | 4.4 | |||
Church & Dwight Co., Inc. | 4.2 | |||
Jarden Corp. | 3.9 | |||
Coca-Cola Enterprises, Inc. | 3.6 | |||
Hain Celestial Group, Inc. (The) | 3.5 | |||
Keurig Green Mountain, Inc. | 3.4 | |||
Newell Rubbermaid, Inc. | 3.3 | |||
Constellation Brands, Inc., Class A | 3.2 | |||
Monster Beverage Corp. | 3.2 | |||
Tyson Foods, Inc., Class A | 2.8 | |||
Total | 35.5 |
| 11 |
|
PowerShares DWA Consumer Staples Momentum Portfolio (PSL) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Consumer Staples Technical LeadersTM Index†† | 10.67 | % | 13.71 | % | 47.04 | % | 18.47 | % | 133.36 | % | 9.83 | % | 103.03 | % | ||||||||||||||||
DWA Consumer Staples Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Consumer Staples Sector IntellidexSM Index†† | 16.79 | 15.77 | 55.17 | 19.75 | 146.26 | 10.62 | 114.26 | |||||||||||||||||||||||
S&P 500® Consumer Staples Index | 10.46 | 15.15 | 52.67 | 18.51 | 133.76 | 10.75 | 116.13 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 9.93 | 12.98 | 44.20 | 17.65 | 125.43 | 9.08 | 92.74 | |||||||||||||||||||||||
Market Price Return | 9.97 | 12.96 | 44.14 | 17.67 | 125.61 | 9.08 | 92.66 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.82%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Consumer Staples Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Consumer Staples Technical LeadersTM Index performance is comprised of the performance of the Dynamic Consumer Staples Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014 |
††† | Average annualized. |
| 12 |
|
PXI | Manager’s Analysis | |
PowerShares DWA Energy Momentum Portfolio (PXI) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Energy Sector Portfolio to PowerShares DWA Energy Momentum Portfolio and the underlying index changed from Dynamic Energy Sector IntellidexSM Index to DWA Energy Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Energy Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Energy Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The energy companies that comprise the Index are principally engaged in the business of producing, distributing or servicing energy-related products, including oil and gas exploration and production, refining, oil services, pipeline, and solar, wind and other non-oil based energy.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the energy sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 25.66%. On a net asset value (“NAV”) basis, the Fund returned 25.64%. During the same time period, the Blended-DWA Energy Technical LeadersTM Index returned 26.40%, while the Dynamic Energy Sector IntellidexSM Index, the Fund’s previous underlying index, returned 26.78%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Energy Index (the “Benchmark Index”) returned 21.34% The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 44 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of other indices similar to the Index. The Benchmark Index was selected for its recognition in the marketplace as well as its shared exposure to the energy sector.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the oil & gas refining & marketing sub-industry and most underweight in the integrated oil & gas sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to these sub-industry allocations.
For the fiscal year ended April 30, 2014, the oil and gas exploration and production sub-industry contributed most significantly to the Fund’s return, followed by the oil and gas equipment and services and oil and gas refining and marketing sub-industries, respectively. Coal and consumable fuels was the only detracting sub-industry.
Positions that contributed most significantly to the Fund’s return included EOG Resources, Inc., an oil & gas exploration & production company (portfolio average weight of 2.48%) and Valero Energy Corporation, an oil & gas refining & marketing company (portfolio average weight of 2.66%). Positions that detracted most significantly from the Fund’s return included SM Energy Company, an oil & gas exploration & production company (no longer held at fiscal year-end); and Swift Energy Company, an oil & gas exploration & production company (no longer held at fiscal year-end).
| 13 |
|
PowerShares DWA Energy Momentum Portfolio (PXI) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Oil & Gas Exploration & Production | 44.0 | |||
Oil & Gas Refining & Marketing | 15.5 | |||
Oil & Gas Equipment & Services | 15.4 | |||
Oil & Gas Storage & Transportation | 15.4 | |||
Oil & Gas Drilling | 7.0 | |||
Specialty Chemicals | 1.9 | |||
Coal & Consumable Fuels | 0.8 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Cheniere Energy, Inc. | 6.7 | |||
Continental Resources, Inc. | 6.5 | |||
Gulfport Energy Corp. | 4.4 | |||
Whiting Petroleum Corp. | 4.4 | |||
Western Refining, Inc. | 4.3 | |||
Marathon Petroleum Corp. | 4.0 | |||
Williams Cos., Inc. (The) | 4.0 | |||
Valero Energy Corp. | 3.8 | |||
PDC Energy, Inc. | 3.4 | |||
Halliburton Co. | 3.4 | |||
Total | 44.9 |
| 14 |
|
PowerShares DWA Energy Momentum Portfolio (PXI) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Energy Technical LeadersTM Index†† | 26.40 | % | 12.46 | % | 42.21 | % | 26.86 | % | 228.62 | % | 13.38 | % | 158.13 | % | ||||||||||||||||
DWA Energy Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Energy Sector IntellidexSM Index†† | 26.78 | 12.57 | 42.64 | 26.94 | 229.61 | 13.43 | 158.91 | |||||||||||||||||||||||
S&P 500® Energy Index | 21.34 | 7.00 | 22.50 | 16.52 | 114.74 | 9.24 | 94.94 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 25.64 | 11.67 | 39.25 | 25.96 | 217.10 | 12.69 | 146.38 | |||||||||||||||||||||||
Market Price Return | 25.66 | 11.63 | 39.09 | 25.93 | 216.73 | 12.69 | 146.40 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses in the past, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.69%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Energy Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Energy Technical LeadersTM Index performance is comprised of the performance of the Dynamic Energy Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 15 |
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PFI | Manager’s Analysis | |
PowerShares DWA Financial Momentum Portfolio (PFI) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Financial Sector Portfolio to PowerShares DWA Financial Momentum Portfolio and the underlying index changed from Dynamic Financial Sector IntellidexSM Index to DWA Financials Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Financial Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Financials Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the financials sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 17.86%. On a net asset value (“NAV”) basis,
the Fund returned 17.89%. During the same time period, the Blended-DWA Financials Technical LeadersTM Index returned 18.81%, while the Dynamic Financial Sector IntellidexSM Index, the Fund’s previous underlying index, returned 19.88%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Financials Index (the “Benchmark Index”) returned 19.65%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 83 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of a broad-based market benchmark. The Benchmark Index was selected for its recognition in the marketplace, and its shared exposure to the financials sector.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the property & casualty insurance sub-industry and most underweight in the diversified banks sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the life & health insurance sub-industry contributed most significantly to the Fund’s return, followed by the regional banks and property & casualty insurance sub-industries, respectively. The thrifts & mortgage finance sub-industry detracted most significantly followed by the specialized finance and data processing & outsourced services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Ameriprise Financial, Inc., a asset management & custody banks company (portfolio average weight of 2.49%) and Principle Financial Group, Inc., a life & health insurance company (portfolio average weight of 2.47%). Positions that detracted most significantly from the Fund’s return included Radian Group Inc., a thrifts & mortgage finance company (portfolio average weight of 0.71%); and First American Financial Corp., a property & casualty insurance company (portfolio average weight of 0.43%).
| 16 |
|
PowerShares DWA Financial Momentum Portfolio (PFI) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Regional Banks | 20.8 | |||
Asset Management & Custody Banks | 12.5 | |||
Data Processing & Outsourced Services | 11.8 | |||
Consumer Finance | 9.8 | |||
Thrifts & Mortgage Finance | 9.4 | |||
Life & Health Insurance | 8.6 | |||
Multi-line Insurance | 5.8 | |||
Property & Casualty Insurance | 4.4 | |||
Mortgage REITs | 3.3 | |||
Hotel & Resort REITs | 3.2 | |||
Diversified Banks | 2.6 | |||
Specialized Finance | 2.1 | |||
Investment Banking & Brokerage | 2.0 | |||
Diversified Capital Markets | 1.4 | |||
Real Estate Development | 1.4 | |||
Internet Software & Services | 0.9 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
MasterCard, Inc., Class A | 5.6 | |||
MGIC Investment Corp. | 5.2 | |||
Fifth Third Bancorp | 4.8 | |||
Ameriprise Financial, Inc. | 3.7 | |||
Invesco Ltd. | 3.6 | |||
Radian Group, Inc. | 3.4 | |||
NorthStar Realty Finance Corp. | 3.3 | |||
Affiliated Managers Group, Inc. | 3.3 | |||
Discover Financial Services | 3.2 | |||
SLM Corp. | 2.9 | |||
Total | 39.0 |
| 17 |
|
PowerShares DWA Financial Momentum Portfolio (PFI) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Financials Technical LeadersTM Index†† | 18.81 | % | 13.19 | % | 45.03 | % | 16.36 | % | 113.28 | % | 3.45 | % | 29.23 | % | ||||||||||||||||
DWA Financials Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Financial Sector IntellidexSM Index†† | 19.88 | 13.53 | 46.33 | 16.57 | 115.20 | 3.58 | 30.39 | |||||||||||||||||||||||
S&P 500® Financials Index | 19.65 | 12.42 | 42.07 | 17.18 | 120.96 | (4.02 | ) | (26.65 | ) | |||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 17.89 | 12.34 | 41.78 | 15.38 | 104.48 | 2.63 | 21.68 | |||||||||||||||||||||||
Market Price Return | 17.86 | 12.32 | 41.70 | 15.40 | 104.67 | 2.62 | 21.60 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 1.19%, including estimated acquired fund fees and expenses of 0.09%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Financials Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Financials Technical LeadersTM Index performance is comprised of the performance of the Dynamic Financial Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 18 |
|
PTH | Manager’s Analysis | |
PowerShares DWA Healthcare Momentum Portfolio (PTH) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Healthcare Sector Portfolio to PowerShares DWA Healthcare Momentum Portfolio and the underlying index changed from Dynamic Healthcare Sector IntellidexSM Index to DWA Healthcare Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Healthcare Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Healthcare Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The health care companies that comprise the Index are principally engaged in the business of providing health care-related products and services, including biotechnology, pharmaceuticals, medical technology and supplies, and facilities.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the health care sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 17.62%. On a net asset value (“NAV”) basis, the Fund returned 17.41%. During the same time period, the Blended-DWA Healthcare Technical LeadersTM Index returned 18.23%, while the Dynamic Healthcare Sector IntellidexSM Index, the Fund’s previous underlying index, returned 31.06%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Health Care Index (the “Benchmark Index”) returned 24.98%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 54 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of other indices similar to the Index. The Benchmark Index was selected for its recognition in the marketplace and its shared exposure to the health care sector.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the health care facilities sub-industry and most underweight in the pharmaceuticals sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations as well as security selection within these sub-industries.
For the fiscal year ended April 30, 2014, the pharmaceuticals sub-industry contributed most significantly to the Fund’s return, followed by the life sciences tools & services sub-industry. The biotechnology sub-industry was the only detracting sub-industry.
Positions that contributed most significantly to the Fund’s return included McKesson Corp., a health care distributors company (no longer held at fiscal year-end) and Illumina, Inc., a life sciences tools & services company (portfolio average weight of 1.65%). Positions that detracted most significantly from the Fund’s return included Medivation, Inc., a biotechnology company (no longer held at fiscal year-end); and ACADIA Pharmaceuticals Inc., a biotechnology company (portfolio average weight of 0.4%).
| 19 |
|
PowerShares DWA Healthcare Momentum Portfolio (PTH) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Biotechnology | 44.5 | |||
Pharmaceuticals | 19.9 | |||
Health Care Equipment | 14.6 | |||
Health Care Supplies | 9.5 | |||
Managed Health Care | 4.0 | |||
Life Sciences Tools & Services | 3.6 | |||
Health Care Services | 2.1 | |||
Auto Parts & Equipment | 0.9 | |||
Health Care Facilities | 0.9 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Alexion Pharmaceuticals, Inc. | 5.7 | |||
Regeneron Pharmaceuticals, Inc. | 5.2 | |||
ACADIA Pharmaceuticals, Inc. | 4.8 | |||
IDEXX Laboratories, Inc. | 4.5 | |||
Actavis PLC | 4.2 | |||
Cooper Cos., Inc. (The) | 3.8 | |||
C.R. Bard, Inc. | 3.2 | |||
Biogen Idec, Inc. | 2.9 | |||
Alkermes PLC | 2.9 | |||
Illumina, Inc. | 2.8 | |||
Total | 40.0 |
| 20 |
|
PowerShares DWA Healthcare Momentum Portfolio (PTH) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Healthcare Technical LeadersTM Index†† | 18.23 | % | 14.36 | % | 49.54 | % | 21.79 | % | 167.95 | % | 9.26 | % | 95.13 | % | ||||||||||||||||
DWA Healthcare Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Healthcare Sector IntellidexSM Index†† | 31.06 | 18.35 | 65.77 | 24.33 | 197.03 | 10.76 | 116.31 | |||||||||||||||||||||||
S&P 500® Health Care Index | 24.98 | 20.72 | 75.94 | 21.70 | 166.96 | 9.91 | 104.06 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 17.41 | 13.55 | 46.43 | 20.88 | 158.06 | 8.46 | 84.59 | |||||||||||||||||||||||
Market Price Return | 17.62 | 13.52 | 46.29 | 20.92 | 158.50 | 8.46 | 84.59 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.80%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Healthcare Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Healthcare Technical LeadersTM Index performance is comprised of the performance of the Dynamic Healthcare Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 21 |
|
PRN | Manager’s Analysis | |
PowerShares DWA Industrials Momentum Portfolio (PRN) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Industrials Sector Portfolio to PowerShares DWA Industrials Momentum Portfolio and the underlying index changed from Dynamic Industrials Sector IntellidexSM Index to DWA Industrials Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Industrials Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Industrials Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The industrial companies that comprise the Index are principally engaged in the business of providing industrial products and services, including engineering, heavy machinery, construction, electrical equipment, aerospace and defense and general manufacturing products and services.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the industrials sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 26.97%. On a net asset value (“NAV”) basis, the Fund returned 27.01%. During the same time period, the Blended-DWA Industrials Technical LeadersTM Index returned 27.89%, while the Dynamic Industrials Sector IntellidexSM Index, the Fund’s previous underlying index, returned 35.60%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Industrials Index (the “Benchmark Index”) returned 30.28%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 64 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of indices similar to the Index. The Benchmark Index was selected for its shared exposure to the industrial sector and recognition in the marketplace.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the airlines sub-industry and most underweight in the industrial conglomerates sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the aerospace and defense sub-industry contributed most significantly to the Fund’s return, followed by the industrial machinery sub-industry. The data processing and outsourced services sub-industry was the most significantly detracting sub-industry, followed by the electronic equipment and instruments sub-industry.
Positions that contributed most significantly to the Fund’s return included Delta Air Lines, Inc., an airlines company (no longer held at fiscal year-end) and Northrop Grumman Corp., an aerospace & defense company (portfolio average weight of 2.28%). Positions that detracted most significantly from the Fund’s return included WageWorks, Inc., a human resource & employment services company (portfolio average weight of 0.23%); and ADT Corp., a security & alarm services company (no longer held at fiscal year-end).
| 22 |
|
PowerShares DWA Industrials Momentum Portfolio (PRN) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Aerospace & Defense | 20.5 | |||
Industrial Machinery | 8.8 | |||
Data Processing & Outsourced Services | 8.5 | |||
Construction Machinery & Heavy Trucks | 6.4 | |||
Electrical Components & Equipment | 6.3 | |||
Trucking | 5.7 | |||
Specialty Chemicals | 4.8 | |||
Semiconductors | 4.7 | |||
Paper Packaging | 4.6 | |||
Railroads | 4.4 | |||
Building Products | 4.3 | |||
Construction & Engineering | 3.0 | |||
Human Resource & Employment Services | 2.6 | |||
Marine | 2.4 | |||
Construction Materials | 2.2 | |||
Electronic Equipment & Instruments | 2.2 | |||
Semiconductor Equipment | 2.0 | |||
Commercial Printing | 1.5 | |||
Internet Software & Services | 1.3 | |||
Research & Consulting Services | 1.2 | |||
Heavy Electrical Equipment | 0.9 | |||
Trading Companies & Distributors | 0.9 | |||
Electronic Components | 0.8 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Precision Castparts Corp. | 5.0 | |||
Sherwin-Williams Co. (The) | 4.8 | |||
SunPower Corp. | 4.7 | |||
Union Pacific Corp. | 4.4 | |||
Lockheed Martin Corp. | 4.2 | |||
B/E Aerospace, Inc. | 4.0 | |||
Generac Holdings, Inc. | 3.8 | |||
Pentair Ltd. | 3.4 | |||
Northrop Grumman Corp. | 2.8 | |||
Cummins, Inc. | 2.7 | |||
Total | 39.8 |
| 23 |
|
PowerShares DWA Industrials Momentum Portfolio (PRN) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Industrials Technical LeadersTM Index†† | 27.89 | % | 15.10 | % | 52.50 | % | 22.30 | % | 173.66 | % | 10.13 | % | 107.23 | % | ||||||||||||||||
DWA Industrials Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Industrials Sector IntellidexSM Index†† | 35.60 | 17.37 | 61.70 | 23.75 | 190.16 | 10.99 | 119.73 | |||||||||||||||||||||||
S&P 500® Industrials Index | 30.28 | 13.65 | 46.80 | 21.94 | 169.57 | 7.52 | 72.90 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 27.01 | 13.96 | 48.01 | 21.13 | 160.81 | 9.16 | 93.83 | |||||||||||||||||||||||
Market Price Return | 26.97 | 13.92 | 47.84 | 21.15 | 161.01 | 9.16 | 93.75 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.92%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Industrials Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Industrials Technical LeadersTM Index performance is comprised of the performance of the Dynamic Industrials Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 24 |
|
PTF | Manager’s Analysis | |
PowerShares DWA Technology Momentum Portfolio (PTF) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Technology Sector Portfolio to PowerShares DWA Technology Momentum Portfolio and the underlying index changed from Dynamic Technology Sector IntellidexSM Index to DWA Technology Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Technology Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Technology Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The technology companies that comprise the Index are principally engaged in the business of providing technology-related products and services, including computer hardware and software, Internet, electronics and semiconductors, and communication technologies.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the technology sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 11.86%. On a net asset value (“NAV”) basis, the Fund returned 11.52%. During the same time period, the Blended-DWA Technology Technical LeadersTM Index returned 12.40%, while the Dynamic Technology Sector IntellidexSM Index, the Fund’s previous underlying index, returned 20.05%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Information Technology Index (the “Benchmark Index”) returned 24.81%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 66 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of other indices similar to the Index. The Benchmark Index was selected for its recognition in the marketplace and its shared exposure to the technology sector.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the data processing & outsourced services sub-industry and most underweight in the systems software sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s underperformance relative to the Benchmark Index during that period can be attributed to these sector allocations.
For the fiscal year ended April 30, 2014, the information technology sub-industry contributed most significantly to the Fund’s return, followed by the Industrials sub-industry. The health care sub-industry was the most significantly detracting sub-industry, followed by the consumer discretionary and telecommunication services sub-industries, respectively.
Positions that contributed most significantly to the Fund’s return included Western Digital Corp., a technology hardware storage & peripherals company (portfolio average weight of 2.58%) and First Solar, Inc., a semiconductors company (portfolio average weight of 1.83%). Positions that detracted most significantly from the Fund’s return included athenahealth, Inc., a health care technology company (portfolio average weight of 0.81%); and Medidata Solutions, Inc., a health care technology company (portfolio average weight of 0.44%).
| 25 |
|
PowerShares DWA Technology Momentum Portfolio (PTF) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Application Software | 19.5 | |||
Semiconductors | 16.8 | |||
Technology Hardware, Storage & Peripherals | 11.5 | |||
Systems Software | 8.1 | |||
Electronic Components | 7.9 | |||
Health Care Technology | 7.6 | |||
Internet Software & Services | 6.7 | |||
Semiconductor Equipment | 5.6 | |||
Wireless Telecommunication Services | 4.6 | |||
IT Consulting & Other Services | 3.1 | |||
Communications Equipment | 3.0 | |||
Cable & Satellite | 1.3 | |||
Data Processing & Outsourced Services | 1.3 | |||
Alternative Carriers | 1.1 | |||
Electronic Manufacturing Services | 1.0 | |||
Construction & Engineering | 0.9 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Amphenol Corp., Class A | 6.3 | |||
SunEdison, Inc. | 5.6 | |||
MICROS Systems, Inc. | 5.6 | |||
Intuit, Inc. | 5.1 | |||
First Solar, Inc. | 3.7 | |||
Skyworks Solutions, Inc. | 3.6 | |||
Micron Technology, Inc. | 3.4 | |||
athenahealth, Inc. | 3.0 | |||
Cerner Corp. | 3.0 | |||
Facebook, Inc., Class A | 2.8 | |||
Total | 42.1 |
| 26 |
|
PowerShares DWA Technology Momentum Portfolio (PTF) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Technology Technical LeadersTM Index†† | 12.40 | % | 6.59 | % | 21.12 | % | 14.50 | % | 96.80 | % | 4.10 | % | 35.44 | % | ||||||||||||||||
DWA Technology Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Technology Sector IntellidexSM Index†† | 20.05 | 8.96 | 29.36 | 16.02 | 110.19 | 5.01 | 44.66 | |||||||||||||||||||||||
S&P 500® Information Technology Index | 24.81 | 13.30 | 45.43 | 18.75 | 136.12 | 8.67 | 87.38 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 11.52 | 5.78 | 18.37 | 13.63 | 89.47 | 3.35 | 28.26 | |||||||||||||||||||||||
Market Price Return | 11.86 | 5.81 | 18.45 | 13.64 | 89.53 | 3.36 | 28.31 |
Fund Inception: October 12, 2006
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.89%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Technology Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Technology Technical LeadersTM Index performance is comprised of the performance of the Dynamic Technology Sector IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014 |
††† | Average annualized. |
| 27 |
|
PUI | Manager’s Analysis | |
PowerShares DWA Utilities Momentum Portfolio (PUI) |
Effective February 19, 2014, the Fund’s name changed from PowerShares Dynamic Utilities Portfolio to PowerShares DWA Utilities Momentum Portfolio and the underlying index changed from Dynamic Utilities IntellidexSM Index to DWA Utilities Technical LeadersTM Index. The Fund also changed its investment objective and investment policies.
As an index fund, the PowerShares DWA Utilities Momentum Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the DWA Utilities Technical LeadersTM Index (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of companies that comprise the Index. The utilities companies that comprise the Index may include companies that generate and supply electricity, including electricity wholesalers; distribute natural gas to customers; provide water to customers, as well as deal with associated wastewater; and provide land line or wireless telephone services.
Dorsey Wright & Associates, LLC (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider uses a proprietary methodology intended to identify objectively those securities within the universe of eligible securities that have the greatest potential for capital appreciation. The methodology evaluates these companies quarterly, based on a variety of criteria, including price momentum, earnings momentum, quality, management action, and value factors, to determine their relative strength, and it then ranks and sorts them based on their cumulative scores. Component securities for the Index are selected from among the companies with the highest-ranking cumulative score (“Model Score”) within the utilities sub-group. In general, momentum is the tendency of an investment to exhibit persistence in its relative performance; a “momentum” style of investing emphasizes investing in securities that have had better recent performance compared to other securities. The momentum score for each security included in the Index is based on intermediate and long-term upward price movements of the security as compared to a representative benchmark and other eligible securities within the universe. The Index is composed of at least 30 common stocks of companies in the relevant sector with powerful relative strength characteristics, selected from a universe of approximately 3,000 common stocks traded on U.S. exchanges. “Relative strength” is an investing technique that seeks to determine the strongest performing securities by measuring certain factors, such as a security’s relative performance against the overall market or a security’s relative strength value, which is derived by comparing the rate of increase of the security’s price over a set period as compared to that of a benchmark index. The Index Provider weights each security by its momentum score, with higher scoring securities representing a greater weight in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 16.35%. On a net asset value (“NAV”) basis, the Fund returned 16.27%. During the same time period, the Blended-DWA Utilities Technical LeadersTM Index returned 17.08%, while the Dynamic Utilities IntellidexSM Index, the Fund’s previous underlying index, returned 15.54%. Although the underlying index changed, the Fund fully replicated the components of the previous and current, as applicable, Index during such periods as the Fund was seeking to track the relevant Index during the fiscal year; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the S&P 500® Utilities Index (the “Benchmark Index”) returned 8.51%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 30 securities. The Fund provided this additional comparative benchmark to help investors better understand how the investment results of the Fund compare to the performance of other indices similar to the Index. The Benchmark Index was selected for its recognition in the marketplace as well as its exposure to the utilities sector.
The performance of the Fund differed from the Benchmark Index in part because the Index employs a proprietary stock selection and weighting methodology, whereas the Benchmark Index selects and weights stocks based on market capitalization. More specifically, relative to the Benchmark Index, the Fund was most overweight in the integrated telecommunication services sub-industry and most underweight in the electric utilities sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during this period can be attributed to its allocation to these sub-industries.
For the fiscal year ended April 30, 2014, the multi-utilities sub-industry contributed most significantly to the Fund’s return, followed by the alternative carriers and electric utilities sub-industries, respectively. The data processing and outsourced services sub-industry was the most significantly detracting sector, followed by the specialized REITs sub-industry.
Positions that contributed most significantly to the Fund’s return included T-Mobile US, Inc., a wireless telecommunication services company (no longer held at fiscal year-end) and DISH Network Corp. Class A, a cable & satellite company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included NII Holdings, Inc., Class B, a wireless telecommunication services company (no longer held at fiscal year-end); and FirstEnergy Corp., an electric utilities company (no longer held at fiscal year-end).
| 28 |
|
PowerShares DWA Utilities Momentum Portfolio (PUI) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Multi-Utilities | 32.1 | |||
Electric Utilities | 31.6 | |||
Gas Utilities | 9.1 | |||
Oil & Gas Storage & Transportation | 7.6 | |||
Water Utilities | 5.2 | |||
Alternative Carriers | 5.0 | |||
Integrated Telecommunication Service | 3.3 | |||
Oil & Gas Exploration & Production | 3.0 | |||
Independent Power Producers & Energy Traders | 2.0 | |||
Diversified Support Services | 1.1 | |||
Money Market Fund Plus Other Assets Less Liabilities | (0.0) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
Sempra Energy | 5.0 | |||
Duke Energy Corp. | 4.9 | |||
ONEOK, Inc. | 4.7 | |||
tw telecom, Inc. | 4.1 | |||
Wisconsin Energy Corp. | 4.1 | |||
Xcel Energy, Inc. | 3.9 | |||
NextEra Energy, Inc. | 3.8 | |||
Southern Co. (The) | 3.6 | |||
CenterPoint Energy, Inc. | 3.6 | |||
Dominion Resources, Inc. | 3.3 | |||
Total | 41.0 |
| 29 |
|
PowerShares DWA Utilities Momentum Portfolio (PUI) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.††† | 3 Years Cumulative | 5 Years Avg. Ann.††† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.††† | Cumulative | ||||||||||||||||||||||||||||
Blended-DWA Utilities Technical LeadersTM Index†† | 17.08 | % | 13.46 | % | 46.06 | % | 16.03 | % | 110.29 | % | 8.50 | % | 100.21 | % | ||||||||||||||||
DWA Utilities Technical LeadersTM Index†† | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Dynamic Utilities IntellidexSM Index†† | 15.54 | 12.96 | 44.14 | 15.72 | 107.52 | 8.33 | 97.58 | |||||||||||||||||||||||
S&P 500® Utilities Index | 8.51 | 13.87 | 47.66 | 15.72 | 107.48 | 8.30 | 97.09 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 16.27 | 12.43 | 42.11 | 15.04 | 101.49 | 7.67 | 87.61 | |||||||||||||||||||||||
Market Price Return | 16.35 | 12.37 | 41.90 | 15.05 | 101.61 | 7.68 | 87.67 |
Fund Inception: October 26, 2005
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Had the adviser not waived fees and/or reimbursed expenses, performance would have been lower. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2015. According to the Fund’s current prospectus, the total gross annual operating expense ratio was indicated as 0.81%. The Financial Highlights section of the Shareholders Report presents the expense ratios based on expenses incurred during the period covered by this report. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not
represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Blended - Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | “1 Year,” “3 Years,” “5 Years” and “Fund Inception” performance for the DWA Utilities Technical LeadersTM Index is not available because that Index did not commence calculation until June 30, 2013. The Blended-DWA Utilities Technical LeadersTM Index performance is comprised of the performance of the Dynamic Utilities IntellidexSM Index, the Fund’s previous underlying index, from Fund inception through the conversion date, February 19, 2014, followed by the performance of the Index, starting from the conversion date through April 30, 2014. |
††† | Average annualized. |
| 30 |
|
PNQI | Manager’s Analysis | |
PowerShares NASDAQ Internet Portfolio (PNQI) |
As an index fund, the PowerShares NASDAQ Internet Portfolio (the “Fund”) is passively managed and attempts to track the returns of an underlying index. The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the NASDAQ Internet IndexSM (the “Index”). The Fund generally will invest at least 90% of its total assets in common stocks of Internet software and service companies that comprise the Index. These companies include those involved in Internet-related services, including Internet access providers, Internet search engines, web hosting, website design and e-commerce.
The NASDAQ OMX Group, Inc. (the “Index Provider”) compiles, maintains and calculates the Index. Strictly in accordance with its existing guidelines and mandated procedures, the Index Provider selects constituents for the Index, which is designed to track the performance of the largest and most liquid U.S.-listed companies that are involved in Internet-related business. In order to be eligible for inclusion in the Index, in addition to being engaged in Internet-related business, a security must: be listed on NASDAQ, the NYSE or the NYSE MKT; have a minimum market capitalization of $200 million; have a minimum three-month average daily trading volume of 100,000 shares; have a minimum closing price of $3.00; be issued by a company that has not entered into a definitive agreement or other arrangement that would likely result in the security no longer being Index eligible; and may not be issued by a company in bankruptcy proceedings or that has annual financial statements with an audit opinion that is currently withdrawn. The Index Provider weights securities included in the Index according to a modified market capitalization methodology. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.
For the fiscal year ended April 30, 2014, on a market price basis, the Fund returned 33.48%. On a net asset value (“NAV”) basis, the Fund returned 33.70%. During the same time period, the Index returned 34.44%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses that the Fund incurred during the period.
During this same time period, the NASDAQ-100® Index (the “Benchmark Index”) returned 25.82%. The Benchmark Index is an unmanaged index weighted by modified market capitalization based on the average performance of approximately 100 securities. The Fund provided this additional comparative benchmark because of its recognition in the marketplace and to help investors better understand how the investment results of the Fund compare to the performance of a broad-based market benchmark.
The performance of the Fund differed from the Benchmark Index in part because the Fund contains a set of companies engaged in
Internet-related businesses, whereas the Benchmark Index consists of the approximately 100 largest non-financial securities listed on the NASDAQ Stock Market.
Relative to the Benchmark Index, the Fund was most overweight in the Internet software & services sub-industry and most underweight in the technology hardware storage & peripherals sub-industry during the fiscal year ended April 30, 2014. The majority of the Fund’s outperformance relative to the Benchmark Index during that period can be attributed to its allocation to the Internet retail sub-industry and Internet software & services sub-industry.
For the fiscal year ended April 30, 2014, the Internet software & services sub-industry contributed most significantly to the Fund’s return, followed by the Internet retail sub-industry and the application software sub-industry. Casinos & gaming was the only detracting sub-industry.
Positions that contributed most significantly to the Fund’s return included Facebook, Inc., an Internet software & services company (portfolio average weight of 8.91%) and Priceline Group Inc., an Internet retail company (portfolio average weight of 8.07%). Positions that detracted most significantly from the Fund’s return included Rackspace Hosting, Inc., an Internet software & services company (portfolio average weight of 1.63%); and Equinix, Inc., an Internet software & services company (portfolio average weight of 2.58%).
| 31 |
|
PowerShares NASDAQ Internet Portfolio (PNQI) (continued)
Sub-Industry Breakdown (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Internet Software & Services | 67.5 | |||
Internet Retail | 30.1 | |||
Application Software | 1.8 | |||
Alternative Carriers | 0.4 | |||
Casinos & Gaming | 0.1 | |||
Systems Software | 0.1 | |||
Wireless Telecommunication Services | 0.1 | |||
Money Market Funds Plus Other Assets Less Liabilities | (0.1) | |||
Top Ten Fund Holdings (% of the Fund’s Net Assets) as of April 30, 2014 | ||||
Security | ||||
eBay, Inc. | 8.3 | |||
Facebook, Inc., Class A | 8.3 | |||
Priceline Group, Inc. (The) | 8.1 | |||
Amazon.com, Inc. | 7.9 | |||
Yahoo!, Inc. | 4.4 | |||
Baidu, Inc. ADR | 4.3 | |||
Google, Inc., Class A | 4.2 | |||
Google, Inc., Class C | 4.1 | |||
Netflix, Inc. | 3.4 | |||
TripAdvisor, Inc. | 2.8 | |||
Total | 55.8 |
| 32 |
|
PowerShares NASDAQ Internet Portfolio (PNQI) (continued)
Growth of a $10,000 Investment Since Inception†
Fund Performance History as of 4/30/14
1 Year | 3 Years Avg. Ann.†† | 3 Years Cumulative | 5 Years Avg. Ann.†† | 5 Years Cumulative | Fund Inception† | |||||||||||||||||||||||||
Index | Avg. Ann.†† | Cumulative | ||||||||||||||||||||||||||||
NASDAQ Internet IndexSM | 34.44 | % | 14.76 | % | 51.12 | % | 28.76 | % | 253.96 | % | 18.04 | % | 165.27 | % | ||||||||||||||||
NASDAQ-100® Index | 25.82 | 15.68 | 54.81 | 22.04 | 170.71 | 12.24 | 97.23 | |||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||
NAV Return | 33.70 | 14.22 | 49.03 | 28.08 | 244.62 | 17.43 | 157.33 | |||||||||||||||||||||||
Market Price Return | 33.48 | 14.13 | 48.66 | 28.04 | 244.19 | 17.08 | 152.87 |
Fund Inception: June 12, 2008
Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. According to the Fund’s current prospectus, the expense ratio of 0.60% is expressed as a unitary management fee to cover operating expenses and expenses incurred in connection with managing the portfolio. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
Index and Benchmark Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index and Benchmark Index do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
† | Fund, Index and Benchmark Index returns are based on the inception date of the Fund. |
†† | Average annualized. |
| 33 |
|
Schedule of Investments(a)
PowerShares DWA Basic Materials Momentum Portfolio (PYZ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Aerospace & Defense—1.7% | ||||||||
38,795 | Hexcel Corp.(b) | $ | 1,617,363 | |||||
|
| |||||||
Aluminum—2.7% | ||||||||
91,396 | Century Aluminum Co.(b) | 1,256,695 | ||||||
17,775 | Kaiser Aluminum Corp. | 1,251,360 | ||||||
|
| |||||||
2,508,055 | ||||||||
|
| |||||||
Commodity Chemicals—10.3% | ||||||||
27,008 | Cabot Corp. | 1,561,062 | ||||||
38,903 | LyondellBasell Industries NV, Class A | 3,598,528 | ||||||
63,297 | Westlake Chemical Corp. | 4,506,746 | ||||||
|
| |||||||
9,666,336 | ||||||||
|
| |||||||
Diversified Chemicals—16.9% | ||||||||
57,893 | Dow Chemical Co. (The) | 2,888,861 | ||||||
25,909 | E.I. du Pont de Nemours & Co. | 1,744,194 | ||||||
33,502 | Eastman Chemical Co. | 2,920,369 | ||||||
50,241 | FMC Corp. | 3,868,557 | ||||||
133,660 | Huntsman Corp. | 3,348,183 | ||||||
42,030 | Olin Corp. | 1,181,043 | ||||||
|
| |||||||
15,951,207 | ||||||||
|
| |||||||
Diversified Metals & Mining—4.0% | ||||||||
56,640 | Horsehead Holding Corp.(b) | 883,018 | ||||||
63,249 | US Silica Holdings, Inc. | 2,856,957 | ||||||
|
| |||||||
3,739,975 | ||||||||
|
| |||||||
Electronic Components—1.0% | ||||||||
16,163 | Rogers Corp.(b) | 970,103 | ||||||
|
| |||||||
Fertilizers & Agricultural Chemicals—2.2% | ||||||||
8,528 | CF Industries Holdings, Inc. | 2,090,810 | ||||||
|
| |||||||
Gold—1.0% | ||||||||
287,099 | Allied Nevada Gold Corp.(b)(c) | 973,266 | ||||||
|
| |||||||
Industrial Gases—7.1% | ||||||||
34,625 | Airgas, Inc. | 3,679,253 | ||||||
23,017 | Praxair, Inc. | 3,004,869 | ||||||
|
| |||||||
6,684,122 | ||||||||
|
| |||||||
Life Sciences Tools & Services—1.5% | ||||||||
66,738 | Cambrex Corp.(b) | 1,367,462 | ||||||
|
| |||||||
Oil & Gas Refining & Marketing—1.5% | ||||||||
47,156 | Green Plains Renewable Energy, Inc. | 1,409,964 | ||||||
|
| |||||||
Paper Products—5.7% | ||||||||
23,127 | Clearwater Paper Corp.(b) | 1,419,767 | ||||||
82,501 | KapStone Paper and Packaging Corp.(b) | 2,176,376 | ||||||
37,362 | P.H. Glatfelter Co. | 953,478 | ||||||
47,000 | Resolute Forest Products, Inc.(b) | 838,480 | ||||||
|
| |||||||
5,388,101 | ||||||||
|
| |||||||
Specialty Chemicals—41.4% | ||||||||
35,558 | Ashland, Inc. | 3,434,903 | ||||||
28,086 | Cytec Industries, Inc. | 2,677,158 | ||||||
18,050 | Ecolab, Inc. | 1,888,752 | ||||||
148,000 | Ferro Corp.(b) | 1,921,040 | ||||||
48,559 | FutureFuel Corp. | 974,579 | ||||||
27,398 | H.B. Fuller Co. | 1,269,349 | ||||||
13,310 | International Flavors & Fragrances, Inc. | 1,311,301 | ||||||
15,658 | Minerals Technologies, Inc. | 931,494 | ||||||
5,675 | NewMarket Corp. | 2,112,916 | ||||||
62,637 | PolyOne Corp. | 2,347,008 | ||||||
13,599 | PPG Industries, Inc. | 2,633,038 |
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Specialty Chemicals (continued) | ||||||||
14,715 | Quaker Chemical Corp. | $ | 1,095,238 | |||||
53,943 | Rockwood Holdings, Inc. | 3,832,650 | ||||||
33,479 | RPM International, Inc. | 1,428,214 | ||||||
25,174 | Sensient Technologies Corp. | 1,360,655 | ||||||
30,156 | Sigma-Aldrich Corp. | 2,901,309 | ||||||
38,718 | Valspar Corp. (The) | 2,827,963 | ||||||
44,105 | W.R. Grace & Co.(b) | 4,062,071 | ||||||
|
| |||||||
39,009,638 | ||||||||
|
| |||||||
Steel—3.0% | ||||||||
21,853 | Carpenter Technology Corp. | 1,372,368 | ||||||
38,906 | Worthington Industries, Inc. | 1,431,741 | ||||||
|
| |||||||
2,804,109 | ||||||||
|
| |||||||
Total Common Stocks (Cost $87,536,114) | 94,180,511 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
70,043 | Invesco Premier Portfolio—Institutional Class(d) (Cost $70,043) | 70,043 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $87,606,157)—100.1% | 94,250,554 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—0.8% | ||||||||
771,062 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $771,062) | 771,062 | ||||||
|
| |||||||
Total Investments (Cost $88,377,219)—100.9% | 95,021,616 | |||||||
Other assets less liabilities—(0.9)% | (831,588 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 94,190,028 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2014. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman & Co. | $ | 706,459 | $ | (706,459 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 34 |
|
Schedule of Investments(a)
PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Airlines—5.7% | ||||||||
12,882 | Alaska Air Group, Inc. | $ | 1,211,939 | |||||
39,193 | American Airlines Group, Inc.(b) | 1,374,498 | ||||||
|
| |||||||
2,586,437 | ||||||||
|
| |||||||
Apparel Retail—3.6% | ||||||||
28,632 | TJX Cos., Inc. (The) | 1,665,810 | ||||||
|
| |||||||
Apparel, Accessories & Luxury Goods—7.5% | ||||||||
15,314 | Kate Spade & Co.(b) | 532,468 | ||||||
23,842 | Under Armour, Inc., Class A(b) | 1,165,635 | ||||||
28,280 | VF Corp. | 1,727,625 | ||||||
|
| |||||||
3,425,728 | ||||||||
|
| |||||||
Auto Parts & Equipment—8.0% | ||||||||
14,577 | Tower International, Inc.(b) | 405,387 | ||||||
40,615 | TRW Automotive Holdings Corp.(b) | 3,263,415 | ||||||
|
| |||||||
3,668,802 | ||||||||
|
| |||||||
Automobile Manufacturers—3.7% | ||||||||
8,240 | Tesla Motors, Inc.(b) | 1,713,014 | ||||||
|
| |||||||
Automotive Retail—6.3% | ||||||||
19,483 | O’Reilly Automotive, Inc.(b) | 2,898,875 | ||||||
|
| |||||||
Broadcasting—4.0% | ||||||||
25,165 | CBS Corp., Class B | 1,453,530 | ||||||
70,228 | Entravision Communications Corp., Class A | 372,911 | ||||||
|
| |||||||
1,826,441 | ||||||||
|
| |||||||
Cable & Satellite—2.3% | ||||||||
32,018 | Starz, Class A(b) | 1,033,221 | ||||||
|
| |||||||
Casinos & Gaming—4.1% | ||||||||
34,498 | Caesars Entertainment Corp.(b) | 637,178 | ||||||
6,167 | Wynn Resorts Ltd. | 1,257,390 | ||||||
|
| |||||||
1,894,568 | ||||||||
|
| |||||||
Construction Machinery & Heavy Trucks—2.1% | ||||||||
9,024 | WABCO Holdings, Inc.(b) | 965,658 | ||||||
|
| |||||||
Department Stores—2.0% | ||||||||
15,904 | Macy’s, Inc. | 913,367 | ||||||
|
| |||||||
Drug Retail—3.7% | ||||||||
230,117 | Rite Aid Corp.(b) | 1,679,854 | ||||||
|
| |||||||
Food Retail—1.8% | ||||||||
10,775 | Susser Holdings Corp.(b) | 833,769 | ||||||
|
| |||||||
General Merchandise Stores—0.9% | ||||||||
28,571 | Tuesday Morning Corp.(b) | 399,423 | ||||||
|
| |||||||
Homefurnishing Retail—2.5% | ||||||||
18,201 | Williams-Sonoma, Inc. | 1,143,387 | ||||||
|
| |||||||
Industrial Machinery—1.4% | ||||||||
2,436 | Middleby Corp. (The)(b) | 615,041 | ||||||
|
| |||||||
Internet Retail—13.9% | ||||||||
5,168 | Amazon.com, Inc.(b) | 1,571,744 | ||||||
4,398 | Netflix, Inc.(b) | 1,416,332 | ||||||
2,919 | Priceline Group, Inc. (The)(b) | 3,379,472 | ||||||
|
| |||||||
6,367,548 | ||||||||
|
| |||||||
Internet Software & Services—4.2% | ||||||||
33,078 | Pandora Media, Inc.(b) | 774,687 | ||||||
10,412 | Zillow, Inc., Class A(b) | 1,131,784 | ||||||
|
| |||||||
1,906,471 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Leisure Products—2.9% | ||||||||
9,969 | Polaris Industries, Inc. | $ | 1,339,136 | |||||
|
| |||||||
Movies & Entertainment—0.9% | ||||||||
13,618 | Carmike Cinemas, Inc.(b) | 403,910 | ||||||
|
| |||||||
Restaurants—10.8% | ||||||||
22,011 | Brinker International, Inc. | 1,081,620 | ||||||
7,157 | Buffalo Wild Wings, Inc.(b) | 1,045,781 | ||||||
26,092 | Domino’s Pizza, Inc. | 1,940,723 | ||||||
12,351 | Starbucks Corp. | 872,228 | ||||||
|
| |||||||
4,940,352 | ||||||||
|
| |||||||
Specialty Stores—5.6% | ||||||||
12,966 | Signet Jewelers Ltd. | 1,313,715 | ||||||
18,728 | Tractor Supply Co. | 1,259,271 | ||||||
|
| |||||||
2,572,986 | ||||||||
|
| |||||||
Trucking—2.1% | ||||||||
18,538 | Avis Budget Group, Inc.(b) | 974,913 | ||||||
|
| |||||||
Total Common Stocks (Cost $47,187,551) | 45,768,711 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
41,864 | Invesco Premier Portfolio—Institutional Class(c) (Cost $41,864) | 41,864 | ||||||
|
| |||||||
Total Investments (Cost $47,229,415)—100.1% | 45,810,575 | |||||||
Other assets less liabilities—(0.1)% | (56,932 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 45,753,643 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 35 |
|
Schedule of Investments(a)
PowerShares DWA Consumer Staples Momentum Portfolio (PSL)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.1% | ||||||||
Data Processing & Outsourced Services—0.3% | ||||||||
4,496 | Blackhawk Network Holdings, Inc., Class B(b) | $ | 103,543 | |||||
|
| |||||||
Distillers & Vintners—5.3% | ||||||||
9,052 | Brown-Forman Corp., Class B | 812,145 | ||||||
15,702 | Constellation Brands, Inc., Class A(b) | 1,253,648 | ||||||
|
| |||||||
2,065,793 | ||||||||
|
| |||||||
Distributors—1.4% | ||||||||
6,784 | Core-Mark Holding Co., Inc. | 546,383 | ||||||
|
| |||||||
Diversified Support Services—1.6% | ||||||||
20,316 | KAR Auction Services, Inc. | 605,010 | ||||||
|
| |||||||
Education Services—9.2% | ||||||||
27,099 | Apollo Education Group, Inc.(b) | 782,077 | ||||||
10,711 | Bright Horizons Family Solutions, Inc.(b) | 436,795 | ||||||
7,652 | Capella Education Co. | 446,571 | ||||||
71,538 | Career Education Corp.(b) | 516,504 | ||||||
14,813 | DeVry Education Group, Inc. | 667,029 | ||||||
16,154 | Grand Canyon Education, Inc.(b) | 696,561 | ||||||
|
| |||||||
3,545,537 | ||||||||
|
| |||||||
Environmental & Facilities Services—1.4% | ||||||||
18,423 | Rollins, Inc. | 554,164 | ||||||
|
| |||||||
Food Distributors—3.6% | ||||||||
10,637 | Andersons, Inc. (The) | 662,579 | ||||||
10,414 | United Natural Foods, Inc.(b) | 718,878 | ||||||
|
| |||||||
1,381,457 | ||||||||
|
| |||||||
Food Retail—4.1% | ||||||||
9,712 | Casey’s General Stores, Inc. | 666,826 | ||||||
27,369 | Safeway, Inc. | 932,188 | ||||||
|
| |||||||
1,599,014 | ||||||||
|
| |||||||
Health Care Facilities—1.4% | ||||||||
17,559 | VCA Antech, Inc.(b) | 537,832 | ||||||
|
| |||||||
Home Furnishings—2.3% | ||||||||
18,033 | Tempur Sealy International, Inc.(b) | 904,896 | ||||||
|
| |||||||
Household Appliances—1.1% | ||||||||
6,956 | Helen of Troy Ltd.(b) | 436,141 | ||||||
|
| |||||||
Household Products—6.0% | ||||||||
23,687 | Church & Dwight Co., Inc. | 1,634,640 | ||||||
9,069 | Spectrum Brands Holdings, Inc. | 696,771 | ||||||
|
| |||||||
2,331,411 | ||||||||
|
| |||||||
Housewares & Specialties—7.2% | ||||||||
26,231 | Jarden Corp.(b) | 1,499,102 | ||||||
42,626 | Newell Rubbermaid, Inc. | 1,283,469 | ||||||
|
| |||||||
2,782,571 | ||||||||
|
| |||||||
Industrial Machinery—1.9% | ||||||||
6,311 | Snap-on, Inc. | 732,076 | ||||||
|
| |||||||
Internet Software & Services—2.7% | ||||||||
18,049 | Yelp, Inc.(b) | 1,052,618 | ||||||
|
| |||||||
Packaged Foods & Meats—28.9% | ||||||||
19,964 | Diamond Foods, Inc.(b) | 610,300 | ||||||
15,706 | Hain Celestial Group, Inc. (The)(b) | 1,351,030 | ||||||
9,731 | Hershey Co. (The) | 936,512 | ||||||
24,795 | Hillshire Brands Co. (The) | 883,942 | ||||||
12,828 | Hormel Foods Corp. | 611,767 | ||||||
5,937 | J & J Snack Foods Corp. | 555,703 |
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Packaged Foods & Meats (continued) | ||||||||
14,262 | Keurig Green Mountain, Inc. | $ | 1,336,064 | |||||
12,228 | Kraft Foods Group, Inc. | 695,284 | ||||||
5,041 | Lancaster Colony Corp. | 478,290 | ||||||
45,274 | Pilgrim’s Pride Corp. (Brazil)(b) | 989,690 | ||||||
17,937 | Pinnacle Foods, Inc. | 545,285 | ||||||
11,000 | Post Holdings, Inc.(b) | 574,860 | ||||||
25,924 | Tyson Foods, Inc., Class A | 1,088,030 | ||||||
19,989 | WhiteWave Foods Co. (The), Class A(b) | 553,495 | ||||||
|
| |||||||
11,210,252 | ||||||||
|
| |||||||
Personal Products—2.7% | ||||||||
12,968 | Inter Parfums, Inc. | 474,499 | ||||||
8,249 | USANA Health Sciences, Inc.(b) | 559,777 | ||||||
|
| |||||||
1,034,276 | ||||||||
|
| |||||||
Soft Drinks—6.8% | ||||||||
30,270 | Coca-Cola Enterprises, Inc. | 1,375,469 | ||||||
18,467 | Monster Beverage Corp.(b) | 1,236,550 | ||||||
|
| |||||||
2,612,019 | ||||||||
|
| |||||||
Specialized Consumer Services—6.3% | ||||||||
32,431 | H&R Block, Inc. | 921,689 | ||||||
41,648 | Service Corp. International | 781,733 | ||||||
17,636 | Sotheby’s | 741,770 | ||||||
|
| |||||||
2,445,192 | ||||||||
|
| |||||||
Trading Companies & Distributors—4.4% | ||||||||
17,973 | United Rentals, Inc.(b) | 1,686,407 | ||||||
|
| |||||||
Trucking—1.5% | ||||||||
2,348 | AMERCO | 587,258 | ||||||
|
| |||||||
Total Common Stocks (Cost $39,147,986) | 38,753,850 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
44,526 | Invesco Premier Portfolio—Institutional Class(c) (Cost $44,526) | 44,526 | ||||||
|
| |||||||
Total Investments (Cost $39,192,512)—100.2% | 38,798,376 | |||||||
Other assets less liabilities—(0.2)% | (59,959 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 38,738,417 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 36 |
|
Schedule of Investments(a)
PowerShares DWA Energy Momentum Portfolio (PXI)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Coal & Consumable Fuels—0.8% | ||||||||
165,225 | Solazyme, Inc.(b) | $ | 1,777,821 | |||||
|
| |||||||
Oil & Gas Drilling—7.0% | ||||||||
61,815 | Helmerich & Payne, Inc. | 6,716,200 | ||||||
182,478 | Patterson-UTI Energy, Inc. | 5,936,009 | ||||||
157,131 | Pioneer Energy Services Corp.(b) | 2,352,251 | ||||||
|
| |||||||
15,004,460 | ||||||||
|
| |||||||
Oil & Gas Equipment & Services—15.4% | ||||||||
142,634 | Basic Energy Services, Inc.(b) | 3,768,390 | ||||||
24,067 | CARBO Ceramics, Inc. | 3,367,214 | ||||||
33,428 | Core Laboratories NV | 6,273,767 | ||||||
142,356 | Exterran Holdings, Inc. | 6,124,155 | ||||||
115,130 | Halliburton Co. | 7,261,249 | ||||||
166,680 | RPC, Inc. | 3,705,297 | ||||||
231,545 | Willbros Group, Inc.(b) | 2,572,465 | ||||||
|
| |||||||
33,072,537 | ||||||||
|
| |||||||
Oil & Gas Exploration & Production—44.0% | ||||||||
113,060 | Bonanza Creek Energy, Inc.(b) | 5,496,977 | ||||||
74,594 | Carrizo Oil & Gas, Inc.(b) | 4,104,162 | ||||||
183,788 | Chesapeake Energy Corp. | 5,283,905 | ||||||
127,810 | Comstock Resources, Inc. | 3,553,118 | ||||||
88,008 | ConocoPhillips | 6,539,875 | ||||||
100,750 | Continental Resources, Inc.(b) | 13,955,890 | ||||||
83,244 | Diamondback Energy, Inc.(b) | 5,988,573 | ||||||
61,636 | EOG Resources, Inc. | 6,040,328 | ||||||
129,172 | Gulfport Energy Corp.(b) | 9,516,101 | ||||||
574,308 | Magnum Hunter Resources Corp.(b) | 4,881,618 | ||||||
196,067 | Matador Resources Co.(b) | 5,631,044 | ||||||
115,800 | PDC Energy, Inc.(b) | 7,372,986 | ||||||
384,181 | Penn Virginia Corp.(b) | 6,392,772 | ||||||
129,058 | Whiting Petroleum Corp.(b) | 9,514,156 | ||||||
|
| |||||||
94,271,505 | ||||||||
|
| |||||||
Oil & Gas Refining & Marketing—15.5% | ||||||||
92,900 | Marathon Petroleum Corp. | 8,635,055 | ||||||
86,396 | Phillips 66 | 7,189,875 | ||||||
141,365 | Valero Energy Corp. | 8,081,837 | ||||||
212,089 | Western Refining, Inc. | 9,225,872 | ||||||
|
| |||||||
33,132,639 | ||||||||
|
| |||||||
Oil & Gas Storage & Transportation—15.4% | ||||||||
255,943 | Cheniere Energy, Inc.(b) | 14,447,982 | ||||||
68,826 | SemGroup Corp., Class A | 4,396,605 | ||||||
52,837 | Targa Resources Corp. | 5,705,868 | ||||||
202,067 | Williams Cos., Inc. (The) | 8,521,165 | ||||||
|
| |||||||
33,071,620 | ||||||||
|
| |||||||
Specialty Chemicals—1.9% | ||||||||
148,804 | Flotek Industries, Inc.(b) | 4,168,000 | ||||||
|
| |||||||
Total Common Stocks (Cost $190,736,594) | 214,498,582 | |||||||
|
| |||||||
Number of Shares | Value | |||||||
Money Market Fund—0.1% | ||||||||
62,040 | Invesco Premier Portfolio—Institutional Class(c) (Cost $62,040) | $ | 62,040 | |||||
|
| |||||||
Total Investments (Cost $190,798,634)—100.1% | 214,560,622 | |||||||
Other assets less liabilities—(0.1)% | (119,879 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 214,440,743 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 37 |
|
Schedule of Investments(a)
PowerShares DWA Financial Momentum Portfolio (PFI)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.0% | ||||||||
Asset Management & Custody Banks—12.5% | ||||||||
5,972 | Affiliated Managers Group, Inc.(b) | $ | 1,183,651 | |||||
11,845 | Ameriprise Financial, Inc. | 1,322,257 | ||||||
37,385 | Invesco Ltd.(c) | 1,316,326 | ||||||
10,107 | Waddell & Reed Financial, Inc., Class A | 681,717 | ||||||
|
| |||||||
4,503,951 | ||||||||
|
| |||||||
Consumer Finance—9.8% | ||||||||
9,899 | American Express Co. | 865,470 | ||||||
3,741 | Credit Acceptance Corp.(b) | 492,016 | ||||||
20,667 | Discover Financial Services | 1,155,285 | ||||||
40,030 | SLM Corp. | 1,030,773 | ||||||
|
| |||||||
3,543,544 | ||||||||
|
| |||||||
Data Processing & Outsourced Services—11.8% | ||||||||
15,810 | Broadridge Financial Solutions, Inc. | 606,156 | ||||||
27,317 | MasterCard, Inc., Class A | 2,009,165 | ||||||
28,745 | Total System Services, Inc. | 913,229 | ||||||
3,584 | Visa, Inc., Class A | 726,154 | ||||||
|
| |||||||
4,254,704 | ||||||||
|
| |||||||
Diversified Banks—2.6% | ||||||||
18,978 | Wells Fargo & Co. | 942,068 | ||||||
|
| |||||||
Diversified Capital Markets—1.4% | ||||||||
15,279 | HFF, Inc., Class A | 519,486 | ||||||
|
| |||||||
Hotel & Resort REITs—3.2% | ||||||||
35,883 | FelCor Lodging Trust, Inc. REIT | 331,200 | ||||||
76,018 | Strategic Hotels & Resorts, Inc. REIT(b) | 820,234 | ||||||
|
| |||||||
1,151,434 | ||||||||
|
| |||||||
Internet Software & Services—0.9% | ||||||||
8,887 | Envestnet, Inc.(b) | 327,486 | ||||||
|
| |||||||
Investment Banking & Brokerage—2.0% | ||||||||
32,204 | E*TRADE Financial Corp.(b) | 722,980 | ||||||
|
| |||||||
Life & Health Insurance—8.6% | ||||||||
48,362 | CNO Financial Group, Inc. | 834,245 | ||||||
18,629 | Principal Financial Group, Inc. | 872,582 | ||||||
14,155 | Protective Life Corp. | 724,028 | ||||||
8,746 | Torchmark Corp. | 697,056 | ||||||
|
| |||||||
3,127,911 | ||||||||
|
| |||||||
Mortgage REITs—3.3% | ||||||||
74,189 | NorthStar Realty Finance Corp. REIT | 1,188,508 | ||||||
|
| |||||||
Multi-line Insurance—5.8% | ||||||||
50,728 | Genworth Financial, Inc., Class A(b) | 905,495 | ||||||
17,729 | HCC Insurance Holdings, Inc. | 814,470 | ||||||
12,763 | Horace Mann Educators Corp. | 383,783 | ||||||
|
| |||||||
2,103,748 | ||||||||
|
| |||||||
Property & Casualty Insurance—4.4% | ||||||||
17,666 | Allstate Corp. (The) | 1,006,079 | ||||||
12,792 | Hilltop Holdings, Inc.(b) | 285,773 | ||||||
9,923 | Stewart Information Services Corp. | 302,652 | ||||||
|
| |||||||
1,594,504 | ||||||||
|
| |||||||
Real Estate Development—1.4% | ||||||||
3,590 | Howard Hughes Corp. (The)(b) | 512,508 | ||||||
|
|
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Regional Banks—20.8% | ||||||||
6,186 | Bank of the Ozarks, Inc. | $ | 370,541 | |||||
8,111 | Banner Corp. | 320,709 | ||||||
21,892 | Boston Private Financial Holdings, Inc. | 273,869 | ||||||
12,307 | Cathay General Bancorp | 290,445 | ||||||
19,605 | East West Bancorp, Inc. | 676,569 | ||||||
84,839 | Fifth Third Bancorp | 1,748,532 | ||||||
14,108 | Hanmi Financial Corp. | 300,077 | ||||||
10,699 | Investors Bancorp, Inc. | 285,984 | ||||||
9,321 | Pinnacle Financial Partners, Inc. | 322,227 | ||||||
15,127 | PrivateBancorp, Inc. | 417,051 | ||||||
4,475 | Signature Bank(b) | 531,720 | ||||||
4,650 | SVB Financial Group(b) | 496,108 | ||||||
8,748 | Texas Capital Bancshares, Inc.(b) | 491,550 | ||||||
15,406 | United Community Banks, Inc.(b) | 248,807 | ||||||
10,551 | ViewPoint Financial Group, Inc. | 275,065 | ||||||
20,175 | Western Alliance Bancorp(b) | 465,437 | ||||||
|
| |||||||
7,514,691 | ||||||||
|
| |||||||
Specialized Finance—2.1% | ||||||||
14,185 | MarketAxess Holdings, Inc. | 764,288 | ||||||
|
| |||||||
Thrifts & Mortgage Finance—9.4% | ||||||||
15,454 | Flagstar Bancorp, Inc.(b) | 271,990 | ||||||
218,092 | MGIC Investment Corp.(b) | 1,875,591 | ||||||
88,878 | Radian Group, Inc. | 1,242,515 | ||||||
|
| |||||||
3,390,096 | ||||||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $36,050,565) | 36,161,907 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
52,064 | Invesco Premier Portfolio—Institutional Class(d) (Cost $52,064) | 52,064 | ||||||
|
| |||||||
Total Investments (Cost $36,102,629)—100.1% | 36,213,971 | |||||||
Other assets less liabilities—(0.1)% | (46,911 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 36,167,060 | ||||||
|
|
Investment Abbreviations:
REIT—Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Affiliated company. The Fund’s Adviser is a wholly-owned subsidiary of Invesco Ltd. and therefore, Invesco Ltd. is considered to be affiliated. See Note 4. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 38 |
|
Schedule of Investments(a)
PowerShares DWA Healthcare Momentum Portfolio (PTH)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Auto Parts & Equipment—0.9% | ||||||||
26,919 | Gentherm, Inc.(b) | $ | 978,506 | |||||
|
| |||||||
Biotechnology—44.5% | ||||||||
251,661 | ACADIA Pharmaceuticals, Inc.(b) | 5,065,936 | ||||||
38,396 | Alexion Pharmaceuticals, Inc.(b) | 6,074,247 | ||||||
66,214 | Alkermes PLC(b) | 3,063,060 | ||||||
68,949 | Anacor Pharmaceuticals, Inc.(b) | 1,135,590 | ||||||
10,937 | Biogen Idec, Inc.(b) | 3,140,231 | ||||||
258,413 | Chelsea Therapeutics International Ltd.(b) | 1,261,055 | ||||||
32,076 | Cubist Pharmaceuticals, Inc.(b) | 2,247,245 | ||||||
125,423 | Dyax Corp.(b) | 829,046 | ||||||
23,171 | Enanta Pharmaceuticals, Inc.(b) | 862,193 | ||||||
31,893 | Gilead Sciences, Inc.(b) | 2,503,282 | ||||||
51,513 | Incyte Corp. Ltd.(b) | 2,501,471 | ||||||
31,209 | Insys Therapeutics, Inc.(b) | 1,281,442 | ||||||
4,798 | Intercept Pharmaceuticals, Inc.(b) | 1,267,248 | ||||||
147,301 | Keryx Biopharmaceuticals, Inc.(b) | 2,175,636 | ||||||
29,368 | Ligand Pharmaceuticals, Inc.(b) | 1,855,177 | ||||||
18,563 | Regeneron Pharmaceuticals, Inc.(b) | 5,511,169 | ||||||
79,701 | Repligen Corp.(b) | 1,263,261 | ||||||
122,903 | Sangamo BioSciences, Inc.(b) | 1,700,977 | ||||||
35,986 | Seattle Genetics, Inc.(b) | 1,384,741 | ||||||
102,865 | Vanda Pharmaceuticals, Inc.(b) | 1,432,909 | ||||||
232,703 | ZIOPHARM Oncology, Inc.(b) | 837,731 | ||||||
|
| |||||||
47,393,647 | ||||||||
|
| |||||||
Health Care Equipment—14.6% | ||||||||
24,644 | C.R. Bard, Inc. | 3,384,360 | ||||||
32,421 | Cardiovascular Systems, Inc.(b) | 932,104 | ||||||
29,135 | Cyberonics, Inc.(b) | 1,723,627 | ||||||
44,255 | DexCom, Inc.(b) | 1,435,632 | ||||||
37,770 | IDEXX Laboratories, Inc.(b) | 4,775,639 | ||||||
50,802 | Insulet Corp.(b) | 1,911,679 | ||||||
139,297 | Rockwell Medical, Inc.(b) | 1,415,258 | ||||||
|
| |||||||
15,578,299 | ||||||||
|
| |||||||
Health Care Facilities—0.9% | ||||||||
38,125 | Kindred Healthcare, Inc. | 956,937 | ||||||
|
| |||||||
Health Care Services—2.1% | ||||||||
39,969 | Air Methods Corp.(b) | 2,225,074 | ||||||
|
| |||||||
Health Care Supplies—9.5% | ||||||||
40,350 | Align Technology, Inc.(b) | 2,033,236 | ||||||
27,308 | Anika Therapeutics, Inc.(b) | 1,167,144 | ||||||
30,734 | Cooper Cos., Inc. (The) | 4,054,122 | ||||||
41,339 | Spectranetics Corp.(b) | 878,867 | ||||||
46,612 | West Pharmaceutical Services, Inc. | 2,022,029 | ||||||
|
| |||||||
10,155,398 | ||||||||
|
| |||||||
Life Sciences Tools & Services—3.6% | ||||||||
22,806 | Fluidigm Corp.(b) | 856,593 | ||||||
21,692 | Illumina, Inc.(b) | 2,946,858 | ||||||
|
| |||||||
3,803,451 | ||||||||
|
| |||||||
Managed Health Care—4.0% | ||||||||
20,748 | Humana, Inc. | 2,277,093 | ||||||
26,146 | UnitedHealth Group, Inc. | 1,961,996 | ||||||
|
| |||||||
4,239,089 | ||||||||
|
|
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Pharmaceuticals—19.9% | ||||||||
106,372 | AcelRX Pharmaceuticals, Inc.(b) | $ | 1,150,945 | |||||
21,790 | Actavis PLC(b) | 4,452,351 | ||||||
17,131 | Allergan, Inc. | 2,841,005 | ||||||
67,906 | Depomed, Inc.(b) | 951,363 | ||||||
31,155 | Endo International PLC(b) | 1,961,051 | ||||||
101,026 | Horizon Pharma, Inc.(b) | 1,432,549 | ||||||
17,105 | Jazz Pharmaceuticals PLC(b) | 2,307,464 | ||||||
41,311 | Lannett Co., Inc.(b) | 1,426,469 | ||||||
33,049 | Pacira Pharmaceuticals, Inc.(b) | 2,263,526 | ||||||
22,637 | Salix Pharmaceuticals Ltd.(b) | 2,490,070 | ||||||
|
| |||||||
21,276,793 | ||||||||
|
| |||||||
Total Common Stocks (Cost $111,109,143) | 106,607,194 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
57,960 | Invesco Premier Portfolio—Institutional Class(c) (Cost $57,960) | 57,960 | ||||||
|
| |||||||
Total Investments (Cost $111,167,103)—100.1% | 106,665,154 | |||||||
Other assets less liabilities—(0.1)% | (104,722 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 106,560,432 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 39 |
|
Schedule of Investments(a)
PowerShares DWA Industrials Momentum Portfolio (PRN)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Aerospace & Defense—20.5% | ||||||||
77,068 | B/E Aerospace, Inc.(b) | $ | 6,764,258 | |||||
95,389 | GenCorp, Inc.(b) | 1,675,031 | ||||||
70,258 | HEICO Corp. | 3,886,673 | ||||||
42,935 | Lockheed Martin Corp. | 7,047,351 | ||||||
39,735 | Northrop Grumman Corp. | 4,828,200 | ||||||
33,493 | Precision Castparts Corp. | 8,476,743 | ||||||
135,672 | Taser International, Inc.(b) | 2,191,103 | ||||||
|
| |||||||
34,869,359 | ||||||||
|
| |||||||
Building Products—4.3% | ||||||||
43,324 | A.O. Smith Corp. | 2,025,830 | ||||||
146,623 | PGT, Inc.(b) | 1,458,899 | ||||||
127,248 | USG Corp.(b) | 3,799,625 | ||||||
|
| |||||||
7,284,354 | ||||||||
|
| |||||||
Commercial Printing—1.5% | ||||||||
45,538 | Deluxe Corp. | 2,502,313 | ||||||
|
| |||||||
Construction & Engineering—3.0% | ||||||||
46,885 | Chicago Bridge & Iron Co. NV | 3,754,082 | ||||||
47,040 | Primoris Services Corp. | 1,316,179 | ||||||
|
| |||||||
5,070,261 | ||||||||
|
| |||||||
Construction Machinery & Heavy Trucks—6.4% | ||||||||
26,586 | American Railcar Industries, Inc. | 1,846,132 | ||||||
30,634 | Cummins, Inc. | 4,621,139 | ||||||
140,182 | Manitowoc Co., Inc. (The) | 4,454,984 | ||||||
|
| |||||||
10,922,255 | ||||||||
|
| |||||||
Construction Materials—2.2% | ||||||||
293,493 | Headwaters, Inc.(b) | 3,662,793 | ||||||
|
| |||||||
Data Processing & Outsourced Services—8.5% | ||||||||
15,776 | Alliance Data Systems Corp.(b) | 3,816,214 | ||||||
37,834 | FleetCor Technologies, Inc.(b) | 4,317,995 | ||||||
75,267 | MAXIMUS, Inc. | 3,204,116 | ||||||
31,769 | WEX, Inc.(b) | 3,048,871 | ||||||
|
| |||||||
14,387,196 | ||||||||
|
| |||||||
Electrical Components & Equipment—6.3% | ||||||||
57,872 | Eaton Corp. PLC | 4,203,822 | ||||||
109,257 | Generac Holdings, Inc. | 6,433,052 | ||||||
|
| |||||||
10,636,874 | ||||||||
|
| |||||||
Electronic Components—0.8% | ||||||||
15,948 | Littelfuse, Inc. | 1,444,091 | ||||||
|
| |||||||
Electronic Equipment & Instruments—2.2% | ||||||||
60,987 | Cognex Corp.(b) | 2,099,782 | ||||||
20,772 | FEI Co. | 1,651,790 | ||||||
|
| |||||||
3,751,572 | ||||||||
|
| |||||||
Heavy Electrical Equipment—0.9% | ||||||||
67,643 | PowerSecure International, Inc.(b) | 1,503,704 | ||||||
|
| |||||||
Human Resource & Employment Services—2.6% | ||||||||
57,499 | On Assignment, Inc.(b) | 2,012,465 | ||||||
56,048 | WageWorks, Inc.(b) | 2,374,754 | ||||||
|
| |||||||
4,387,219 | ||||||||
|
| |||||||
Industrial Machinery—8.8% | ||||||||
40,637 | Altra Industrial Motion Corp. | 1,388,160 | ||||||
45,937 | Colfax Corp.(b) | 3,306,545 |
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Industrial Machinery (continued) | ||||||||
36,772 | IDEX Corp. | $ | 2,742,088 | |||||
189,554 | Mueller Water Products, Inc., Class A | 1,728,732 | ||||||
77,019 | Pentair Ltd. | 5,721,742 | ||||||
|
| |||||||
14,887,267 | ||||||||
|
| |||||||
Internet Software & Services—1.3% | ||||||||
13,807 | CoStar Group, Inc.(b) | 2,221,408 | ||||||
|
| |||||||
Marine—2.4% | ||||||||
39,974 | Kirby Corp.(b) | 4,022,184 | ||||||
|
| |||||||
Paper Packaging—4.6% | ||||||||
365,671 | Graphic Packaging Holding Co.(b) | 3,751,784 | ||||||
61,438 | Packaging Corp. of America | 4,093,614 | ||||||
|
| |||||||
7,845,398 | ||||||||
|
| |||||||
Railroads—4.4% | ||||||||
39,143 | Union Pacific Corp. | 7,454,002 | ||||||
|
| |||||||
Research & Consulting Services—1.2% | ||||||||
35,827 | Advisory Board Co. (The)(b) | 2,051,454 | ||||||
|
| |||||||
Semiconductor Equipment—2.0% | ||||||||
208,884 | GT Advanced Technologies, Inc.(b) | 3,469,563 | ||||||
|
| |||||||
Semiconductors—4.7% | ||||||||
236,603 | SunPower Corp. (France)(b) | 7,907,272 | ||||||
|
| |||||||
Specialty Chemicals—4.8% | ||||||||
40,954 | Sherwin-Williams Co. (The) | 8,184,247 | ||||||
|
| |||||||
Trading Companies & Distributors—0.9% | ||||||||
40,426 | H&E Equipment Services, Inc.(b) | 1,558,422 | ||||||
|
| |||||||
Trucking—5.7% | ||||||||
75,445 | ArcBest Corp.(b) | 2,974,042 | ||||||
51,123 | Old Dominion Freight Line, Inc.(b) | 3,099,588 | ||||||
40,259 | Saia, Inc.(b) | 1,657,463 | ||||||
85,605 | YRC Worldwide, Inc.(b) | 1,920,120 | ||||||
|
| |||||||
9,651,213 | ||||||||
|
| |||||||
Total Common Stocks (Cost $172,013,580) | 169,674,421 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
76,562 | Invesco Premier Portfolio—Institutional Class(c) (Cost $76,562) | 76,562 | ||||||
|
| |||||||
Total Investments (Cost $172,090,142)—100.1% | 169,750,983 | |||||||
Other assets less liabilities—(0.1)% | (128,753 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 169,622,230 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 40 |
|
Schedule of Investments(a)
PowerShares DWA Technology Momentum Portfolio (PTF)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Alternative Carriers—1.1% | ||||||||
42,206 | Inteliquent, Inc. | $ | 575,690 | |||||
|
| |||||||
Application Software—19.5% | ||||||||
13,830 | ACI Worldwide, Inc.(b) | 790,384 | ||||||
20,547 | Aspen Technology, Inc.(b) | 883,316 | ||||||
38,785 | Ellie Mae, Inc.(b) | 945,966 | ||||||
14,133 | Guidewire Software, Inc.(b) | 533,662 | ||||||
8,721 | Interactive Intelligence Group, Inc.(b) | 545,673 | ||||||
36,026 | Intuit, Inc. | 2,728,970 | ||||||
33,135 | Manhattan Associates, Inc.(b) | 1,044,747 | ||||||
16,359 | Monotype Imaging Holdings, Inc. | 432,041 | ||||||
12,617 | Netscout Systems, Inc.(b) | 491,558 | ||||||
16,991 | Splunk, Inc.(b) | 927,199 | ||||||
9,373 | Ultimate Software Group, Inc. (The)(b) | 1,121,292 | ||||||
|
| |||||||
10,444,808 | ||||||||
|
| |||||||
Cable & Satellite—1.3% | ||||||||
9,525 | Loral Space & Communications, Inc.(b) | 685,705 | ||||||
|
| |||||||
Communications Equipment—3.0% | ||||||||
23,410 | CalAmp Corp.(b) | 415,527 | ||||||
31,193 | Ubiquiti Networks, Inc.(b) | 1,208,105 | ||||||
|
| |||||||
1,623,632 | ||||||||
|
| |||||||
Construction & Engineering—0.9% | ||||||||
16,837 | Tutor Perini Corp.(b) | 498,375 | ||||||
|
| |||||||
Data Processing & Outsourced Services—1.3% | ||||||||
12,893 | Jack Henry & Associates, Inc. | 711,178 | ||||||
|
| |||||||
Electronic Components—7.9% | ||||||||
35,181 | Amphenol Corp., Class A | 3,354,508 | ||||||
12,158 | Belden, Inc. | 897,382 | ||||||
|
| |||||||
4,251,890 | ||||||||
|
| |||||||
Electronic Manufacturing Services—1.0% | ||||||||
36,869 | Maxwell Technologies, Inc.(b) | 555,247 | ||||||
|
| |||||||
Health Care Technology—7.6% | ||||||||
12,951 | athenahealth, Inc.(b) | 1,601,261 | ||||||
31,179 | Cerner Corp.(b) | 1,599,483 | ||||||
23,638 | Medidata Solutions, Inc.(b) | 858,296 | ||||||
|
| |||||||
4,059,040 | ||||||||
|
| |||||||
Internet Software & Services—6.7% | ||||||||
17,332 | Cornerstone OnDemand, Inc.(b) | 637,124 | ||||||
11,593 | Demandware, Inc.(b) | 575,361 | ||||||
25,169 | Facebook, Inc., Class A(b) | 1,504,603 | ||||||
27,676 | Web.com Group, Inc.(b) | 849,930 | ||||||
|
| |||||||
3,567,018 | ||||||||
|
| |||||||
IT Consulting & Other Services—3.1% | ||||||||
24,259 | Cognizant Technology Solutions Corp., Class A(b) | 1,162,128 | ||||||
14,559 | Virtusa Corp.(b) | 480,010 | ||||||
|
| |||||||
1,642,138 | ||||||||
|
| |||||||
Semiconductor Equipment—5.6% | ||||||||
155,755 | SunEdison, Inc.(b) | 2,995,169 | ||||||
|
| |||||||
Semiconductors—16.8% | ||||||||
29,047 | First Solar, Inc.(b) | 1,960,382 | ||||||
28,257 | Freescale Semiconductor Ltd.(b) | 620,806 | ||||||
69,065 | Micron Technology, Inc.(b) | 1,803,978 | ||||||
19,043 | Monolithic Power Systems, Inc.(b) | 706,495 |
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Semiconductors (continued) | ||||||||
46,786 | Skyworks Solutions, Inc.(b) | $ | 1,920,565 | |||||
18,917 | Synaptics, Inc.(b) | 1,175,692 | ||||||
55,713 | TriQuint Semiconductor, Inc.(b) | 790,010 | ||||||
|
| |||||||
8,977,928 | ||||||||
|
| |||||||
Systems Software—8.1% | ||||||||
58,109 | MICROS Systems, Inc.(b) | 2,992,613 | ||||||
12,659 | NetSuite, Inc.(b) | 978,667 | ||||||
14,972 | Proofpoint, Inc.(b) | 380,888 | ||||||
|
| |||||||
4,352,168 | ||||||||
|
| |||||||
Technology Hardware, Storage & Peripherals—11.5% | ||||||||
2,530 | Apple, Inc. | 1,492,928 | ||||||
33,845 | Cray, Inc.(b) | 971,690 | ||||||
18,477 | Electronics for Imaging, Inc.(b) | 698,246 | ||||||
34,854 | Hewlett-Packard Co. | 1,152,273 | ||||||
15,054 | Lexmark International, Inc., Class A | 647,322 | ||||||
13,703 | Western Digital Corp. | 1,207,645 | ||||||
|
| |||||||
6,170,104 | ||||||||
|
| |||||||
Wireless Telecommunication Services—4.6% | ||||||||
15,784 | SBA Communications Corp., Class A(b) | 1,416,772 | ||||||
34,780 | T-Mobile US, Inc.(b) | 1,018,706 | ||||||
|
| |||||||
2,435,478 | ||||||||
|
| |||||||
Total Common Stocks (Cost $56,484,635) | 53,545,568 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
54,022 | Invesco Premier Portfolio—Institutional Class(c) (Cost $54,022) | 54,022 | ||||||
|
| |||||||
Total Investments (Cost $56,538,657)—100.1% | 53,599,590 | |||||||
Other assets less liabilities—(0.1)% | (74,377 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 53,525,213 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 41 |
|
Schedule of Investments(a)
PowerShares DWA Utilities Momentum Portfolio (PUI)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks—100.0% | ||||||||
Alternative Carriers—5.0% | ||||||||
56,144 | tw telecom, Inc.(b) | $ | 1,723,060 | |||||
97,743 | Vonage Holdings Corp.(b) | 375,333 | ||||||
|
| |||||||
2,098,393 | ||||||||
|
| |||||||
Diversified Support Services—1.1% | ||||||||
19,417 | EnerNOC, Inc.(b) | 458,241 | ||||||
|
| |||||||
Electric Utilities—31.6% | ||||||||
19,348 | Cleco Corp. | 1,016,737 | ||||||
27,115 | Duke Energy Corp. | 2,019,796 | ||||||
19,016 | Hawaiian Electric Industries, Inc. | 456,194 | ||||||
10,175 | IDACORP, Inc. | 571,225 | ||||||
25,063 | ITC Holdings Corp. | 926,579 | ||||||
15,767 | NextEra Energy, Inc. | 1,574,335 | ||||||
24,843 | Northeast Utilities | 1,174,080 | ||||||
19,590 | OGE Energy Corp. | 731,295 | ||||||
30,086 | PNM Resources, Inc. | 832,781 | ||||||
33,115 | Southern Co. (The) | 1,517,660 | ||||||
18,881 | Westar Energy, Inc. | 677,450 | ||||||
51,206 | Xcel Energy, Inc. | 1,631,935 | ||||||
|
| |||||||
13,130,067 | ||||||||
|
| |||||||
Gas Utilities—9.1% | ||||||||
16,764 | AGL Resources, Inc. | 905,256 | ||||||
16,916 | Atmos Energy Corp. | 863,393 | ||||||
6,406 | National Fuel Gas Co. | 471,738 | ||||||
27,615 | Questar Corp. | 670,492 | ||||||
6,222 | Southwest Gas Corp. | 342,272 | ||||||
11,441 | UGI Corp. | 534,180 | ||||||
|
| |||||||
3,787,331 | ||||||||
|
| |||||||
Independent Power Producers & Energy Traders—2.0% | ||||||||
36,378 | Calpine Corp.(b) | 834,148 | ||||||
|
| |||||||
Integrated Telecommunication Services—3.3% | ||||||||
16,290 | Consolidated Communications Holdings, Inc. | 324,497 | ||||||
173,312 | Frontier Communications Corp. | 1,031,206 | ||||||
|
| |||||||
1,355,703 | ||||||||
|
| |||||||
Multi-Utilities—32.1% | ||||||||
11,186 | Alliant Energy Corp. | 654,157 | ||||||
11,957 | Black Hills Corp. | 690,517 | ||||||
59,970 | CenterPoint Energy, Inc. | 1,484,857 | ||||||
43,196 | CMS Energy Corp. | 1,309,271 | ||||||
19,115 | Dominion Resources, Inc. | 1,386,602 | ||||||
15,703 | DTE Energy Co. | 1,227,033 | ||||||
9,096 | Integrys Energy Group, Inc. | 557,403 | ||||||
13,570 | MDU Resources Group, Inc. | 480,649 | ||||||
10,586 | NorthWestern Corp. | 512,151 | ||||||
11,446 | SCANA Corp. | 614,421 | ||||||
20,940 | Sempra Energy | 2,064,893 | ||||||
16,409 | Vectren Corp. | 665,713 | ||||||
34,812 | Wisconsin Energy Corp. | 1,687,686 | ||||||
|
| |||||||
13,335,353 | ||||||||
|
| |||||||
Oil & Gas Exploration & Production—3.0% | ||||||||
11,273 | EQT Corp. | 1,228,644 | ||||||
|
|
Number of Shares | Value | |||||||
Common Stocks (continued) | ||||||||
Oil & Gas Storage & Transportation—7.6% | ||||||||
31,069 | ONEOK, Inc. | $ | 1,964,182 | |||||
30,494 | Spectra Energy Corp. | 1,210,917 | ||||||
|
| |||||||
3,175,099 | ||||||||
|
| |||||||
Water Utilities—5.2% | ||||||||
28,223 | American Water Works Co., Inc. | 1,284,993 | ||||||
24,397 | Aqua America, Inc. | 612,121 | ||||||
12,192 | California Water Service Group | 274,320 | ||||||
|
| |||||||
2,171,434 | ||||||||
|
| |||||||
Total Common Stocks (Cost $36,993,590) | 41,574,413 | |||||||
|
| |||||||
Money Market Fund—0.1% | ||||||||
50,837 | Invesco Premier Portfolio—Institutional Class(c) (Cost $50,837) | 50,837 | ||||||
|
| |||||||
Total Investments (Cost $37,044,427)—100.1% | 41,625,250 | |||||||
Other assets less liabilities—(0.1)% | (24,037 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 41,601,213 | ||||||
|
|
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 42 |
|
Schedule of Investments(a)
PowerShares NASDAQ Internet Portfolio (PNQI)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests—100.1% | ||||||||
Alternative Carriers—0.4% | ||||||||
36,538 | Cogent Communications Group, Inc. | $ | 1,259,465 | |||||
|
| |||||||
Application Software—1.8% | ||||||||
37,846 | NQ Mobile, Inc. ADR (China)(b)(c) | 467,776 | ||||||
93,690 | Open Text Corp. (Canada) | 4,622,665 | ||||||
6,216 | Sungy Mobile Ltd. ADR (China)(b)(c) | 101,694 | ||||||
|
| |||||||
5,192,135 | ||||||||
|
| |||||||
Casinos & Gaming—0.1% | ||||||||
5,128 | 500.com Ltd., Class A ADR (China)(b)(c) | 162,558 | ||||||
|
| |||||||
Internet Retail—30.1% | ||||||||
75,687 | Amazon.com, Inc.(c) | 23,018,687 | ||||||
9,855 | Blue Nile, Inc.(c) | 342,264 | ||||||
112,662 | Ctrip.com International Ltd. ADR (China)(c) | 5,265,822 | ||||||
89,998 | Expedia, Inc. | 6,388,958 | ||||||
525,251 | Groupon, Inc.(c) | 3,671,505 | ||||||
71,318 | HomeAway, Inc.(c) | 2,326,393 | ||||||
30,737 | Netflix, Inc.(c) | 9,898,544 | ||||||
22,151 | Nutrisystem, Inc. | 332,265 | ||||||
83,642 | Orbitz Worldwide, Inc.(c) | 614,769 | ||||||
18,487 | Overstock.com, Inc.(c) | 296,162 | ||||||
15,579 | PetMed Express, Inc.(b) | 203,929 | ||||||
20,319 | Priceline Group, Inc. (The)(c) | 23,524,322 | ||||||
9,860 | Qunar Cayman Islands Ltd. ADR (China)(b)(c) | 243,542 | ||||||
38,352 | RetailMeNot, Inc.(c) | 1,143,273 | ||||||
29,510 | Shutterfly, Inc.(c) | 1,207,844 | ||||||
99,852 | TripAdvisor, Inc.(c) | 8,062,050 | ||||||
25,972 | Vitacost.com, Inc.(c) | 173,233 | ||||||
10,202 | zulily, Inc., Class A(b)(c) | 433,789 | ||||||
|
| |||||||
87,147,351 | ||||||||
|
| |||||||
Internet Software & Services—67.5% | ||||||||
33,937 | 21Vianet Group, Inc. ADR (China)(c) | 815,167 | ||||||
138,086 | Akamai Technologies, Inc.(c) | 7,328,224 | ||||||
45,163 | Angie’s List, Inc.(b)(c) | 510,794 | ||||||
61,329 | AOL, Inc.(c) | 2,625,494 | ||||||
80,162 | Baidu, Inc. ADR (China)(c) | 12,332,924 | ||||||
79,345 | Bankrate, Inc. (United Kingdom)(c) | 1,390,124 | ||||||
58,530 | Bazaarvoice, Inc.(b)(c) | 393,322 | ||||||
18,879 | Benefitfocus, Inc.(b)(c) | 611,680 | ||||||
32,568 | Blucora, Inc.(c) | 626,934 | ||||||
24,303 | Brightcove, Inc.(c) | 209,492 | ||||||
20,415 | Carbonite, Inc.(c) | 201,904 | ||||||
11,054 | ChinaCache International Holdings Ltd. ADR (China)(c) | 152,545 | ||||||
26,668 | comScore, Inc.(c) | 835,508 | ||||||
23,659 | Constant Contact, Inc.(c) | 611,822 | ||||||
51,526 | Conversant, Inc.(c) | 1,259,295 | ||||||
40,759 | Cornerstone OnDemand, Inc.(c) | 1,498,301 | ||||||
22,255 | CoStar Group, Inc.(c) | 3,580,607 | ||||||
7,181 | Criteo SA ADR (France)(c) | 229,648 | ||||||
34,083 | Dealertrack Technologies, Inc.(c) | 1,557,252 | ||||||
27,249 | Demandware, Inc.(c) | 1,352,368 | ||||||
41,805 | Dice Holdings, Inc.(c) | 319,808 | ||||||
25,529 | Digital River, Inc.(c) | 390,338 | ||||||
22,164 | E2open, Inc.(b)(c) | 382,772 | ||||||
78,898 | EarthLink Holdings Corp. | 269,042 |
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Internet Software & Services (continued) | ||||||||
466,323 | eBay, Inc.(c) | $ | 24,169,521 | |||||
19,605 | eGain Corp.(c) | 128,217 | ||||||
99,643 | Endurance International Group Holdings, Inc.(b)(c) | 1,260,484 | ||||||
38,124 | Equinix, Inc.(b)(c) | 7,160,068 | ||||||
400,287 | Facebook, Inc., Class A(c) | 23,929,157 | ||||||
57,830 | Global Eagle Entertainment, Inc.(c) | 637,865 | ||||||
64,916 | Gogo, Inc.(b)(c) | 877,664 | ||||||
22,535 | Google, Inc., Class A(c) | 12,053,521 | ||||||
22,548 | Google, Inc., Class C(c) | 11,875,130 | ||||||
58,969 | IAC/InterActiveCorp. | 3,908,465 | ||||||
41,759 | Internap Network Services Corp.(c) | 280,620 | ||||||
35,921 | j2 Global, Inc. | 1,665,298 | ||||||
24,923 | Liquidity Services, Inc.(b)(c) | 429,922 | ||||||
41,790 | LivePerson, Inc.(c) | 413,721 | ||||||
18,692 | LogMeIn, Inc.(c) | 849,551 | ||||||
28,027 | Marchex, Inc., Class B | 259,250 | ||||||
25,468 | Marin Software, Inc.(b)(c) | 238,890 | ||||||
30,298 | Marketo, Inc.(c) | 822,288 | ||||||
34,026 | MercadoLibre, Inc. (Argentina)(b) | 3,173,605 | ||||||
74,188 | Monster Worldwide, Inc.(c) | 511,155 | ||||||
30,325 | Move, Inc.(c) | 324,174 | ||||||
56,930 | NetEase, Inc. ADR (China) | 3,876,364 | ||||||
50,194 | NIC, Inc. | 920,558 | ||||||
18,102 | OpenTable, Inc.(c) | 1,215,730 | ||||||
152,308 | Pandora Media, Inc.(c) | 3,567,053 | ||||||
25,496 | Perficient, Inc.(c) | 465,812 | ||||||
51,911 | Perion Network Ltd. (Israel)(b)(c) | 561,158 | ||||||
68,961 | Qihoo 360 Technology Co. Ltd. ADR (China)(b)(c) | 5,818,929 | ||||||
33,568 | QuinStreet, Inc.(c) | 204,765 | ||||||
107,854 | Rackspace Hosting, Inc.(c) | 3,129,923 | ||||||
27,051 | Rocket Fuel, Inc.(b)(c) | 867,526 | ||||||
20,693 | SciQuest, Inc.(c) | 496,218 | ||||||
27,068 | Shutterstock, Inc.(c) | 1,962,701 | ||||||
51,442 | SINA Corp. (China)(c) | 2,458,928 | ||||||
29,637 | Sohu.com, Inc. (China)(c) | 1,635,073 | ||||||
12,430 | Stamps.com, Inc.(c) | 431,445 | ||||||
11,572 | Travelzoo, Inc.(c) | 207,602 | ||||||
28,790 | Trulia, Inc.(b)(c) | 978,860 | ||||||
103,116 | Verisign, Inc.(c) | 4,865,013 | ||||||
25,643 | Vistaprint NV(b)(c) | 1,012,129 | ||||||
16,314 | Vocus, Inc.(c) | 293,326 | ||||||
39,625 | Web.com Group, Inc.(c) | 1,216,884 | ||||||
31,101 | WebMD Health Corp.(b)(c) | 1,371,243 | ||||||
28,748 | Wix.com Ltd. (Israel)(b)(c) | 589,047 | ||||||
29,075 | Xoom Corp.(c) | 648,663 | ||||||
354,386 | Yahoo!, Inc.(c) | 12,740,177 | ||||||
193,424 | Yandex NV, Class A (Russia)(c) | 5,125,736 | ||||||
24,648 | YuMe, Inc.(b)(c) | 164,895 | ||||||
24,066 | YY, Inc. ADR (China)(b)(c) | 1,380,426 | ||||||
25,479 | Zillow, Inc., Class A(b)(c) | 2,769,567 | ||||||
48,184 | Zix Corp.(c) | 158,044 | ||||||
|
| |||||||
195,587,726 | ||||||||
|
| |||||||
Systems Software—0.1% | ||||||||
28,931 | Covisint Corp.(b)(c) | 204,253 | ||||||
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 43 |
|
PowerShares NASDAQ Internet Portfolio (PNQI) (continued)
April 30, 2014
Number of Shares | Value | |||||||
Common Stocks and Other Equity Interests (continued) | ||||||||
Wireless Telecommunication Services—0.1% | ||||||||
27,192 | Boingo Wireless, Inc.(c) | $ | 179,467 | |||||
|
| |||||||
Total Common Stocks and Other Equity Interests (Cost $301,358,495) | 289,732,955 | |||||||
|
| |||||||
Money Market Fund—0.0% | ||||||||
41,421 | Invesco Premier Portfolio—Institutional Class(d) (Cost $41,421) | 41,421 | ||||||
|
| |||||||
Total Investments (excluding investments purchased with cash collateral from securities on loan) (Cost $301,399,916)—100.1% | 289,774,376 | |||||||
|
| |||||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||||
Money Market Fund—6.5% | ||||||||
18,863,761 | Invesco Liquid Assets Portfolio—Institutional Class(d)(e) (Cost $18,863,761) | 18,863,761 | ||||||
|
| |||||||
Total Investments (Cost $320,263,677)—106.6% | 308,638,137 | |||||||
Other assets less liabilities—(6.6)% | (19,010,460 | ) | ||||||
|
| |||||||
Net Assets—100.0% | $ | 289,627,677 | ||||||
|
|
Investment Abbreviations:
ADR—American Depositary Receipt
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | All or a portion of this security was out on loan at April 30, 2014. |
(c) | Non-income producing security. |
(d) | The security and the Fund are advised by wholly-owned subsidiaries of Invesco Ltd. and are therefore considered to be affiliated. |
(e) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 2G. The following table presents the Fund’s gross and net amount of assets available for offset by the Fund as of April 30, 2014. |
Counterparty | Gross Amount of Securities on Loan at Value | Cash Collateral Received for Securities Loaned* | Net Amount | |||||||||
Brown Brothers Harriman & Co. | $ | 18,364,682 | $ | (18,364,682 | ) | $ | — |
* | Amount does not include excess collateral received, if any. |
This Fund has holdings greater than 10% of net assets in the following country:
China | 12.0% |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 44 |
|
(This Page Intentionally Left Blank)
Statements of Assets and Liabilities
April 30, 2014
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) | PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ) | PowerShares DWA Consumer Staples Momentum Portfolio (PSL) | PowerShares DWA Energy Momentum Portfolio (PXI) | |||||||||||||
Assets: | ||||||||||||||||
Unaffiliated investments, at value(a) | $ | 94,180,511 | $ | 45,768,711 | $ | 38,753,850 | $ | 214,498,582 | ||||||||
Affiliated investments, at value | 841,105 | 41,864 | 44,526 | 62,040 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at value | 95,021,616 | 45,810,575 | 38,798,376 | 214,560,622 | ||||||||||||
Receivables: | ||||||||||||||||
Shares sold | 2,572,088 | — | — | 2,978,994 | ||||||||||||
Dividends | 39,690 | 8,341 | 8,219 | 53,596 | ||||||||||||
Security lending | 2,746 | — | — | — | ||||||||||||
Investments sold | — | — | — | — | ||||||||||||
Other assets | 3,333 | 3,333 | 3,333 | 3,333 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Assets | 97,639,473 | 45,822,249 | 38,809,928 | 217,596,545 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Liabilities: | ||||||||||||||||
Payables: | ||||||||||||||||
Investments purchased | 2,572,313 | — | — | 2,977,528 | ||||||||||||
Shares repurchased | — | — | — | — | ||||||||||||
Collateral upon return of securities loaned | 771,062 | — | — | — | ||||||||||||
Accrued advisory fees | 29,638 | 5,933 | 8,812 | 71,714 | ||||||||||||
Accrued trustees’ and officer’s fees | 13,018 | 11,163 | 12,020 | 14,786 | ||||||||||||
Accrued expenses | 63,414 | 51,510 | 50,679 | 91,774 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Liabilities | 3,449,445 | 68,606 | 71,511 | 3,155,802 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 94,190,028 | $ | 45,753,643 | $ | 38,738,417 | $ | 214,440,743 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets Consist of: | ||||||||||||||||
Shares of beneficial interest | $ | 105,975,482 | $ | 56,629,677 | $ | 46,835,742 | $ | 212,316,639 | ||||||||
Undistributed net investment income (loss) | 241,490 | (39 | ) | 168,991 | 496,931 | |||||||||||
Undistributed net realized gain (loss) | (18,671,341 | ) | (9,457,155 | ) | (7,872,180 | ) | (22,134,815 | ) | ||||||||
Net unrealized appreciation (depreciation) | 6,644,397 | (1,418,840 | ) | (394,136 | ) | 23,761,988 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets | $ | 94,190,028 | $ | 45,753,643 | $ | 38,738,417 | $ | 214,440,743 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 1,800,000 | 1,150,000 | 900,000 | 3,550,000 | ||||||||||||
Net asset value | $ | 52.33 | $ | 39.79 | $ | 43.04 | $ | 60.41 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Market price | $ | 52.31 | $ | 39.74 | $ | 43.03 | $ | 60.37 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Unaffiliated investments, at cost | $ | 87,536,114 | $ | 47,187,551 | $ | 39,147,986 | $ | 190,736,594 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Affiliated investments, at cost | $ | 841,105 | $ | 41,864 | $ | 44,526 | $ | 62,040 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Total investments, at cost | $ | 88,377,219 | $ | 47,229,415 | $ | 39,192,512 | $ | 190,798,634 | ||||||||
|
|
|
|
|
|
|
| |||||||||
(a) Includes securities on loan with an aggregate value of | $ | 706,459 | $ | — | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 46 |
|
PowerShares DWA Financial Momentum Portfolio (PFI) | PowerShares DWA Healthcare Momentum Portfolio (PTH) | PowerShares DWA Industrials Momentum Portfolio (PRN) | PowerShares DWA Technology Momentum Portfolio (PTF) | PowerShares DWA Utilities Momentum Portfolio (PUI) | PowerShares NASDAQ Internet Portfolio (PNQI) | |||||||||||||||||
$ | 34,845,581 | $ | 106,607,194 | $ | 169,674,421 | $ | 53,545,568 | $ | 41,574,413 | $ | 289,732,955 | |||||||||||
1,368,390 | 57,960 | 76,562 | 54,022 | 50,837 | 18,905,182 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
36,213,971 | 106,665,154 | 169,750,983 | 53,599,590 | 41,625,250 | 308,638,137 | |||||||||||||||||
— | — | 4,565,416 | — | — | — | |||||||||||||||||
13,646 | 10,047 | 25,403 | — | 46,643 | — | |||||||||||||||||
— | — | — | — | — | 16,141 | |||||||||||||||||
— | 2,270,317 | 2,305,371 | — | — | 6,158,732 | |||||||||||||||||
3,333 | 3,333 | 3,333 | 3,334 | 3,333 | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
36,230,950 | 108,948,851 | 176,650,506 | 53,602,924 | 41,675,226 | 314,813,010 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
— | — | 4,563,183 | — | — | — | |||||||||||||||||
— | 2,267,243 | 2,306,524 | — | — | 6,158,158 | |||||||||||||||||
— | — | — | — | — | 18,863,761 | |||||||||||||||||
3,904 | 32,306 | 53,435 | 12,841 | 13,537 | 163,414 | |||||||||||||||||
11,216 | 14,352 | 13,248 | 12,019 | 12,320 | — | |||||||||||||||||
48,770 | 74,518 | 91,886 | 52,851 | 48,156 | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
63,890 | 2,388,419 | 7,028,276 | 77,711 | 74,013 | 25,185,333 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 36,167,060 | $ | 106,560,432 | $ | 169,622,230 | $ | 53,525,213 | $ | 41,601,213 | $ | 289,627,677 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 46,284,107 | $ | 160,155,997 | $ | 208,736,454 | $ | 86,071,152 | $ | 51,984,848 | $ | 310,437,072 | |||||||||||
42,017 | (155,606 | ) | 76,762 | (41,992 | ) | 87,360 | (459,490 | ) | ||||||||||||||
(10,270,406 | ) | (48,938,010 | ) | (36,851,827 | ) | (29,564,880 | ) | (15,051,818 | ) | (8,724,365 | ) | |||||||||||
111,342 | (4,501,949 | ) | (2,339,159 | ) | (2,939,067 | ) | 4,580,823 | (11,625,540 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 36,167,060 | $ | 106,560,432 | $ | 169,622,230 | $ | 53,525,213 | $ | 41,601,213 | $ | 289,627,677 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
1,300,000 | 2,350,000 | 3,650,000 | 1,650,000 | 1,850,000 | 4,700,000 | |||||||||||||||||
$ | 27.82 | $ | 45.34 | $ | 46.47 | $ | 32.44 | $ | 22.49 | $ | 61.62 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 27.79 | $ | 45.34 | $ | 46.43 | $ | 32.45 | $ | 22.47 | $ | 61.51 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 34,769,575 | $ | 111,109,143 | $ | 172,013,580 | $ | 56,484,635 | $ | 36,993,590 | $ | 301,358,495 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 1,333,054 | $ | 57,960 | $ | 76,562 | $ | 54,022 | $ | 50,837 | $ | 18,905,182 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 36,102,629 | $ | 111,167,103 | $ | 172,090,142 | $ | 56,538,657 | $ | 37,044,427 | $ | 320,263,677 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | — | $ | — | $ | — | $ | — | $ | — | $ | 18,364,682 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| 47 |
|
For the year ended April 30, 2014
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) | PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ) | PowerShares DWA Consumer Staples Momentum Portfolio (PSL) | PowerShares DWA Energy Momentum Portfolio (PXI) | |||||||||||||
Investment Income: | ||||||||||||||||
Unaffiliated dividend income | $ | 1,349,818 | $ | 282,496 | $ | 847,553 | $ | 2,068,295 | ||||||||
Affiliated dividend income | 16 | 9 | 11 | 20 | ||||||||||||
Securities lending income | 12,287 | — | — | — | ||||||||||||
Foreign withholding tax | — | — | — | (4,683 | ) | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Income | 1,362,121 | 282,505 | 847,564 | 2,063,632 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Expenses: | ||||||||||||||||
Advisory fees | 396,745 | 133,818 | 192,996 | 801,907 | ||||||||||||
Sub-licensing | 41,733 | 18,045 | 20,768 | 84,268 | ||||||||||||
Accounting & administration fees | 36,058 | 36,058 | 36,058 | 36,058 | ||||||||||||
Professional fees | 29,068 | 26,914 | 24,938 | 35,788 | ||||||||||||
Trustees’ and officer’s fees | 10,828 | 9,378 | 9,666 | 12,884 | ||||||||||||
Custodian & transfer agent fees | 4,573 | 2,688 | 4,554 | 4,155 | ||||||||||||
Recapture (Note 3) | — | — | — | 17,993 | ||||||||||||
Other expenses | 21,115 | 15,468 | 16,470 | 31,436 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total Expenses | 540,120 | 242,369 | 305,450 | 1,024,489 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Waivers | (32,876 | ) | (72,348 | ) | (58,726 | ) | (121 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net Expenses | 507,244 | 170,021 | 246,724 | 1,024,368 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Investment Income (Loss) | 854,877 | 112,484 | 600,840 | 1,039,264 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Realized and Unrealized Gain (Loss): | ||||||||||||||||
Net realized gain (loss) from: | ||||||||||||||||
Investment securities | 4,161,937 | 797,648 | 4,264,167 | 5,874,990 | ||||||||||||
In-kind redemptions | 13,255,304 | 6,024,944 | 7,495,200 | 23,076,529 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized gain | 17,417,241 | 6,822,592 | 11,759,367 | 28,951,519 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net change in unrealized appreciation (depreciation) on investment securities | (2,979,184 | ) | (4,467,963 | ) | (8,568,511 | ) | 8,823,850 | |||||||||
|
|
|
|
|
|
|
| |||||||||
Net realized and unrealized gain | 14,438,057 | 2,354,629 | 3,190,856 | 37,775,369 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | $ | 15,292,934 | $ | 2,467,113 | $ | 3,791,696 | $ | 38,814,633 | ||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 48 |
|
PowerShares DWA Financial Momentum Portfolio (PFI) | PowerShares DWA Healthcare Momentum Portfolio (PTH) | PowerShares DWA Industrials Momentum Portfolio (PRN) | PowerShares DWA Technology Momentum Portfolio (PTF) | PowerShares DWA Utilities Momentum Portfolio (PUI) | PowerShares NASDAQ Internet Portfolio (PNQI) | |||||||||||||||||
$ | 480,004 | $ | 533,699 | $ | 1,061,683 | $ | 287,400 | $ | 1,148,960 | $ | 308,365 | |||||||||||
11 | 12 | 15 | 12 | 10 | 12 | |||||||||||||||||
— | — | — | — | — | 76,964 | |||||||||||||||||
(107 | ) | — | (1,462 | ) | — | — | (5,843 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
479,908 | 533,711 | 1,060,236 | 287,412 | 1,148,970 | 379,498 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
130,542 | 414,888 | 499,876 | 186,145 | 195,279 | 1,250,636 | |||||||||||||||||
13,859 | 46,209 | 55,289 | 21,383 | 13,481 | — | |||||||||||||||||
36,058 | 36,058 | 36,058 | 36,058 | 36,058 | — | |||||||||||||||||
25,911 | 25,801 | 25,545 | 24,953 | 24,962 | — | |||||||||||||||||
9,265 | 10,757 | 10,759 | 9,552 | 9,687 | — | |||||||||||||||||
3,893 | 3,171 | 1,811 | 2,165 | 4,285 | — | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||
17,002 | 29,867 | 35,326 | 17,140 | 16,798 | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
236,530 | 566,751 | 664,664 | 297,396 | 300,550 | 1,250,636 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(69,932 | ) | (38,442 | ) | (30,676 | ) | (60,150 | ) | (53,886 | ) | (88 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
166,598 | 528,309 | 633,988 | 237,246 | 246,664 | 1,250,548 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
313,310 | 5,402 | 426,248 | 50,166 | 902,306 | (871,050 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
1,723,976 | 3,577,444 | 6,604,668 | 1,603,216 | 2,956,747 | (5,120,834 | ) | ||||||||||||||||
4,110,391 | 15,417,710 | 14,266,822 | 7,465,744 | 4,245,830 | 39,843,754 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
5,834,367 | 18,995,154 | 20,871,490 | 9,068,960 | 7,202,577 | 34,722,920 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
(2,648,471 | ) | (12,438,845 | ) | (7,691,104 | ) | (7,416,013 | ) | (2,181,700 | ) | (19,851,903 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
3,185,896 | 6,556,309 | 13,180,386 | 1,652,947 | 5,020,877 | 14,871,017 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||
$ | 3,499,206 | $ | 6,561,711 | $ | 13,606,634 | $ | 1,703,113 | $ | 5,923,183 | $ | 13,999,967 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| 49 |
|
Statements of Changes in Net Assets
For the years ended April 30, 2014 and 2013
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) | PowerShares DWA Consumer | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 854,877 | $ | 1,045,060 | $ | 112,484 | $ | 356,766 | ||||||||
Net realized gain | 17,417,241 | 3,018,440 | 6,822,592 | 4,261,722 | ||||||||||||
Net change in unrealized appreciation (depreciation) | (2,979,184 | ) | 4,647,985 | (4,467,963 | ) | 174,934 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | 15,292,934 | 8,711,485 | 2,467,113 | 4,793,422 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (855,864 | ) | (1,050,895 | ) | (129,334 | ) | (332,955 | ) | ||||||||
Return of capital | — | — | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total distributions to shareholders | (855,864 | ) | (1,050,895 | ) | (129,334 | ) | (332,955 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 73,661,881 | 59,425,865 | 59,400,392 | 47,664,294 | ||||||||||||
Value of shares repurchased | (74,162,058 | ) | (53,756,851 | ) | (39,917,618 | ) | (47,628,525 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | (500,177 | ) | 5,669,014 | 19,482,774 | 35,769 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | 13,936,893 | 13,329,604 | 21,820,553 | 4,496,236 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 80,253,135 | 66,923,531 | 23,933,090 | 19,436,854 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
End of year | $ | 94,190,028 | $ | 80,253,135 | $ | 45,753,643 | $ | 23,933,090 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Undistributed net investment income (loss) at end of year | $ | 241,490 | $ | 125,208 | $ | (39 | ) | $ | 20,309 | |||||||
|
|
|
|
|
|
|
| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 1,550,000 | 1,500,000 | 1,500,000 | 1,600,000 | ||||||||||||
Shares repurchased | (1,600,000 | ) | (1,400,000 | ) | (1,050,000 | ) | (1,550,000 | ) | ||||||||
Shares outstanding, beginning of year | 1,850,000 | 1,750,000 | 700,000 | 650,000 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Shares outstanding, end of year | 1,800,000 | 1,850,000 | 1,150,000 | 700,000 | ||||||||||||
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 50 |
|
PowerShares DWA Consumer | PowerShares DWA Energy Momentum Portfolio (PXI) | PowerShares DWA Financial Momentum Portfolio (PFI) | PowerShares DWA Healthcare Momentum Portfolio (PTH) | |||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
$ | 600,840 | $ | 719,200 | $ | 1,039,264 | $ | 1,346,417 | $ | 313,310 | $ | 310,737 | $ | 5,402 | $ | 582,499 | |||||||||||||||
11,759,367 | 4,386,527 | 28,951,519 | 6,107,583 | 5,834,367 | 2,261,425 | 18,995,154 | 5,178,641 | |||||||||||||||||||||||
(8,568,511 | ) | 2,798,508 | 8,823,850 | 14,877,574 | (2,648,471 | ) | 1,179,820 | (12,438,845 | ) | 4,322,451 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
3,791,696 | 7,904,235 | 38,814,633 | 22,331,574 | 3,499,206 | 3,751,982 | 6,561,711 | 10,083,591 | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
(519,961 | ) | (761,607 | ) | (942,939 | ) | (1,757,378 | ) | (327,300 | ) | (308,168 | ) | (245,316 | ) | (519,661 | ) | |||||||||||||||
— | — | — | — | — | — | — | — | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
(519,961 | ) | (761,607 | ) | (942,939 | ) | (1,757,378 | ) | (327,300 | ) | (308,168 | ) | (245,316 | ) | (519,661 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
40,671,117 | 16,887,134 | 211,564,193 | 95,321,127 | 41,859,075 | 22,746,892 | 129,950,062 | 68,466,346 | |||||||||||||||||||||||
(42,912,351 | ) | (25,453,074 | ) | (172,910,991 | ) | (119,541,343 | ) | (29,193,899 | ) | (23,931,832 | ) | (89,776,750 | ) | (55,093,388 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
(2,241,234 | ) | (8,565,940 | ) | 38,653,202 | (24,220,216 | ) | 12,665,176 | (1,184,940 | ) | 40,173,312 | 13,372,958 | |||||||||||||||||||
|
|
|
|
|
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|
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| |||||||||||||||
1,030,501 | (1,423,312 | ) | 76,524,896 | (3,646,020 | ) | 15,837,082 | 2,258,874 | 46,489,707 | 22,936,888 | |||||||||||||||||||||
|
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|
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|
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| |||||||||||||||
37,707,916 | 39,131,228 | 137,915,847 | 141,561,867 | 20,329,978 | 18,071,104 | 60,070,725 | 37,133,837 | |||||||||||||||||||||||
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| |||||||||||||||
$ | 38,738,417 | $ | 37,707,916 | $ | 214,440,743 | $ | 137,915,847 | $ | 36,167,060 | $ | 20,329,978 | $ | 106,560,432 | $ | 60,070,725 | |||||||||||||||
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| |||||||||||||||
$ | 168,991 | $ | 88,112 | $ | 496,931 | $ | 17,629 | $ | 42,017 | $ | 61,037 | $ | (155,606 | ) | $ | 84,308 | ||||||||||||||
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| |||||||||||||||
950,000 | 500,000 | 3,950,000 | 2,200,000 | 1,550,000 | 1,100,000 | 2,850,000 | 2,050,000 | |||||||||||||||||||||||
(1,000,000 | ) | (750,000 | ) | (3,250,000 | ) | (2,850,000 | ) | (1,100,000 | ) | (1,150,000 | ) | (2,050,000 | ) | (1,650,000 | ) | |||||||||||||||
950,000 | 1,200,000 | 2,850,000 | 3,500,000 | 850,000 | 900,000 | 1,550,000 | 1,150,000 | |||||||||||||||||||||||
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900,000 | 950,000 | 3,550,000 | 2,850,000 | 1,300,000 | 850,000 | 2,350,000 | 1,550,000 | |||||||||||||||||||||||
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| 51 |
|
Statements of Changes in Net Assets (continued)
For the years ended April 30, 2014 and 2013
PowerShares DWA Industrials Momentum Portfolio (PRN) | PowerShares DWA Technology Momentum Portfolio (PTF) | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income (loss) | $ | 426,248 | $ | 494,811 | $ | 50,166 | $ | 187,651 | ||||||||
Net realized gain | 20,871,490 | 2,227,742 | 9,068,960 | 1,922,360 | ||||||||||||
Net change in unrealized appreciation (depreciation) | (7,691,104 | ) | 4,044,778 | (7,416,013 | ) | 166,645 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Net increase in net assets resulting from operations | 13,606,634 | 6,767,331 | 1,703,113 | 2,276,656 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Distributions to Shareholders from: | ||||||||||||||||
Net investment income | (341,196 | ) | (607,832 | ) | (65,769 | ) | (220,275 | ) | ||||||||
Return of capital | — | (39,658 | ) | — | — | |||||||||||
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| |||||||||
Total distributions to shareholders | (341,196 | ) | (647,490 | ) | (65,769 | ) | (220,275 | ) | ||||||||
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|
|
|
| |||||||||
Shareholder Transactions: | ||||||||||||||||
Proceeds from shares sold | 216,269,719 | 31,963,235 | 56,477,215 | 21,294,978 | ||||||||||||
Value of shares repurchased | (98,486,362 | ) | (29,526,956 | ) | (36,642,270 | ) | (22,685,236 | ) | ||||||||
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|
|
|
|
| |||||||||
Net increase (decrease) in net assets resulting from shares transactions | 117,783,357 | 2,436,279 | 19,834,945 | (1,390,258 | ) | |||||||||||
|
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|
|
|
|
|
| |||||||||
Increase (Decrease) in Net Assets | 131,048,795 | 8,556,120 | 21,472,289 | 666,123 | ||||||||||||
|
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| |||||||||
Net Assets: | ||||||||||||||||
Beginning of year | 38,573,435 | 30,017,315 | 32,052,924 | 31,386,801 | ||||||||||||
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| |||||||||
End of year | $ | 169,622,230 | $ | 38,573,435 | $ | 53,525,213 | $ | 32,052,924 | ||||||||
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| |||||||||
Undistributed net investment income (loss) at end of year | $ | 76,762 | $ | (8,290 | ) | $ | (41,992 | ) | $ | (27,274 | ) | |||||
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|
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|
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| |||||||||
Changes in Shares Outstanding: | ||||||||||||||||
Shares sold | 4,800,000 | 1,000,000 | 1,700,000 | 800,000 | ||||||||||||
Shares repurchased | (2,200,000 | ) | (950,000 | ) | (1,150,000 | ) | (850,000 | ) | ||||||||
Shares outstanding, beginning of year | 1,050,000 | 1,000,000 | 1,100,000 | 1,150,000 | ||||||||||||
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| |||||||||
Shares outstanding, end of year | 3,650,000 | 1,050,000 | 1,650,000 | 1,100,000 | ||||||||||||
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See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 52 |
|
PowerShares DWA Utilities Momentum Portfolio (PUI) | PowerShares NASDAQ Internet Portfolio (PNQI) | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
$ | 902,306 | $ | 1,033,426 | $ | (871,050 | ) | $ | (8,440 | ) | |||||
7,202,577 | 866,472 | 34,722,920 | 5,214,400 | |||||||||||
(2,181,700 | ) | 6,101,677 | (19,851,903 | ) | 243,934 | |||||||||
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| |||||||
5,923,183 | 8,001,575 | 13,999,967 | 5,449,894 | |||||||||||
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|
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| |||||||
(929,718 | ) | (1,054,339 | ) | — | (27,038 | ) | ||||||||
— | — | — | — | |||||||||||
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|
|
|
|
|
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| |||||||
(929,718 | ) | (1,054,339 | ) | — | (27,038 | ) | ||||||||
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| |||||||
16,775,859 | 15,274,609 | 317,679,346 | 26,166,289 | |||||||||||
(22,772,053 | ) | (23,011,381 | ) | (106,576,777 | ) | (30,742,175 | ) | |||||||
|
|
|
|
|
|
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| |||||||
(5,996,194 | ) | (7,736,772 | ) | 211,102,569 | (4,575,886 | ) | ||||||||
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| |||||||
(1,002,729 | ) | (789,536 | ) | 225,102,536 | 846,970 | |||||||||
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| |||||||
42,603,942 | 43,393,478 | 64,525,141 | 63,678,171 | |||||||||||
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| |||||||
$ | 41,601,213 | $ | 42,603,942 | $ | 289,627,677 | $ | 64,525,141 | |||||||
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| |||||||
$ | 87,360 | $ | 114,772 | $ | (459,490 | ) | $ | (45,192 | ) | |||||
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| |||||||
850,000 | 900,000 | 4,950,000 | 600,000 | |||||||||||
(1,150,000 | ) | (1,350,000 | ) | (1,650,000 | ) | (750,000 | ) | |||||||
2,150,000 | 2,600,000 | 1,400,000 | 1,550,000 | |||||||||||
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| |||||||
1,850,000 | 2,150,000 | 4,700,000 | 1,400,000 | |||||||||||
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| 53 |
|
PowerShares DWA Basic Materials Momentum Portfolio (PYZ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 43.38 | $ | 38.24 | $ | 40.66 | $ | 31.30 | $ | 20.14 | ||||||||||
Net investment income(a) | 0.51 | 0.63 | 0.47 | 0.86 | (b) | 0.28 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 8.95 | 5.16 | (2.46 | ) | 9.34 | 11.20 | ||||||||||||||
Total from investment operations | 9.46 | 5.79 | (1.99 | ) | 10.20 | 11.48 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.51 | ) | (0.65 | ) | (0.43 | ) | (0.84 | ) | (0.32 | ) | ||||||||||
Net asset value at end of year | $ | 52.33 | $ | 43.38 | $ | 38.24 | $ | 40.66 | $ | 31.30 | ||||||||||
Market price at end of year(c) | $ | 52.31 | $ | 43.29 | $ | 38.20 | $ | 40.67 | $ | 31.34 | ||||||||||
Net Asset Value Total Return(d) | 21.97 | % | 15.37 | % | (4.76 | )% | 33.12 | % | 57.46 | % | ||||||||||
Market Price Total Return(d) | 22.18 | % | 15.26 | % | (4.88 | )% | 32.98 | % | 57.59 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 94,190 | $ | 80,253 | $ | 66,924 | $ | 97,591 | $ | 48,517 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | % | 0.65 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.68 | % | 0.72 | % | 0.76 | % | 0.79 | % | 0.91 | % | ||||||||||
Net investment income, after Waivers | 1.08 | % | 1.59 | % | 1.33 | % | 2.56 | %(b) | 1.05 | % | ||||||||||
Portfolio turnover rate(e) | 158 | % | 63 | % | 78 | % | 28 | % | 46 | % |
PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 34.19 | $ | 29.90 | $ | 27.54 | $ | 23.72 | $ | 17.07 | ||||||||||
Net investment income(a) | 0.17 | 0.39 | 0.18 | 0.20 | 0.06 | |||||||||||||||
Net realized and unrealized gain on investments | 5.63 | 4.24 | 2.37 | 3.79 | 6.65 | |||||||||||||||
Total from investment operations | 5.80 | 4.63 | 2.55 | 3.99 | 6.71 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.20 | ) | (0.34 | ) | (0.19 | ) | (0.17 | ) | (0.06 | ) | ||||||||||
Net asset value at end of year | $ | 39.79 | $ | 34.19 | $ | 29.90 | $ | 27.54 | $ | 23.72 | ||||||||||
Market price at end of year(c) | $ | 39.74 | $ | 34.16 | $ | 29.89 | $ | 27.53 | $ | 23.74 | ||||||||||
Net Asset Value Total Return(d) | 16.97 | % | 15.67 | % | 9.41 | % | 16.91 | % | 39.37 | % | ||||||||||
Market Price Total Return(d) | 16.93 | % | 15.60 | % | 9.41 | % | 16.77 | % | 39.49 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 45,754 | $ | 23,933 | $ | 19,437 | $ | 20,657 | $ | 21,345 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | % | 0.65 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.91 | % | 0.93 | % | 1.19 | % | 1.24 | % | 1.32 | % | ||||||||||
Net investment income, after Waivers | 0.42 | % | 1.29 | % | 0.69 | % | 0.86 | % | 0.31 | % | ||||||||||
Portfolio turnover rate(e) | 236 | % | 130 | % | 88 | % | 68 | % | 86 | % |
(a) | Based on average shares outstanding. |
(b) | Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $1.65 per share owned of Weyerhaeuser Co. on July 20, 2010. Net investment income per share and the ratio of net investment income to average net assets excluding the special dividend are $0.26 and 0.78%, respectively. |
(c) | The mean between the last bid and ask prices. |
(d) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. For the fiscal year ended April 30, 2014, the portfolio turnover calculation for PowerShares DWA Basic Materials Momentum Portfolio and PowerShares DWA Consumer Cyclicals Momentum Portfolio includes the value of securities purchased and sold in the effort to realign the Funds’ portfolio holdings due to the underlying index change. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 54 |
|
Financial Highlights (continued)
PowerShares DWA Consumer Staples Momentum Portfolio (PSL)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 39.69 | $ | 32.61 | $ | 31.36 | $ | 26.74 | $ | 20.81 | ||||||||||
Net investment income(a) | 0.66 | 0.66 | 0.48 | 0.52 | 0.36 | |||||||||||||||
Net realized and unrealized gain on investments | 3.26 | 7.13 | 1.22 | 4.61 | 5.99 | |||||||||||||||
Total from investment operations | 3.92 | 7.79 | 1.70 | 5.13 | 6.35 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.57 | ) | (0.71 | ) | (0.45 | ) | (0.51 | ) | (0.42 | ) | ||||||||||
Net asset value at end of year | $ | 43.04 | $ | 39.69 | $ | 32.61 | $ | 31.36 | $ | 26.74 | ||||||||||
Market price at end of year(b) | $ | 43.03 | $ | 39.67 | $ | 32.60 | $ | 31.37 | $ | 26.74 | ||||||||||
Net Asset Value Total Return(c) | 9.93 | % | 24.29 | % | 5.53 | % | 19.46 | % | 30.87 | % | ||||||||||
Market Price Total Return(c) | 9.97 | % | 24.27 | % | 5.47 | % | 19.50 | % | 30.99 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 38,738 | $ | 37,708 | $ | 39,131 | $ | 40,772 | $ | 38,772 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | % | 0.65 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.79 | % | 0.82 | % | 0.89 | % | 0.94 | % | 0.87 | % | ||||||||||
Net investment income, after Waivers | 1.56 | % | 1.94 | % | 1.54 | % | 1.91 | % | 1.50 | % | ||||||||||
Portfolio turnover rate(d) | 175 | % | 57 | % | 35 | % | 54 | % | 67 | % |
PowerShares DWA Energy Momentum Portfolio (PXI)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 48.39 | $ | 40.45 | $ | 44.63 | $ | 29.75 | $ | 19.91 | ||||||||||
Net investment income(a) | 0.34 | 0.47 | 0.21 | 0.32 | 0.20 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 12.01 | 8.13 | (4.15 | ) | 14.77 | 9.87 | ||||||||||||||
Total from investment operations | 12.35 | 8.60 | (3.94 | ) | 15.09 | 10.07 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.33 | ) | (0.66 | ) | (0.24 | ) | (0.21 | ) | (0.23 | ) | ||||||||||
Net asset value at end of year | $ | 60.41 | $ | 48.39 | $ | 40.45 | $ | 44.63 | $ | 29.75 | ||||||||||
Market price at end of year(b) | $ | 60.37 | $ | 48.36 | $ | 40.47 | $ | 44.65 | $ | 29.75 | ||||||||||
Net Asset Value Total Return(c) | 25.66 | % | 21.48 | % | (8.79 | )% | 51.01 | % | 50.81 | % | ||||||||||
Market Price Total Return(c) | 25.66 | % | 21.35 | % | (8.78 | )% | 51.07 | % | 50.73 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 214,441 | $ | 137,916 | $ | 141,562 | $ | 191,903 | $ | 38,671 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | % | 0.66 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.64 | % | 0.69 | % | 0.66 | % | 0.74 | % | 0.93 | % | ||||||||||
Net investment income, after Waivers | 0.65 | % | 1.10 | % | 0.54 | % | 0.90 | % | 0.79 | % | ||||||||||
Portfolio turnover rate(d) | 198 | % | 80 | % | 107 | % | 35 | % | 63 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. For the fiscal year ended April 30, 2014, the portfolio turnover calculation for PowerShares DWA Consumer Staples Momentum Portfolio and PowerShares DWA Energy Momentum Portfolio includes the value of securities purchased and sold in the effort to realign the Funds’ portfolio holdings due to the underlying index change. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 55 |
|
Financial Highlights (continued)
PowerShares DWA Financial Momentum Portfolio (PFI)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 23.92 | $ | 20.08 | $ | 20.45 | $ | 18.46 | $ | 14.63 | ||||||||||
Net investment income(a) | 0.32 | 0.35 | 0.25 | 0.27 | 0.21 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 3.93 | 3.83 | (0.42 | ) | 2.04 | 3.84 | ||||||||||||||
Total from investment operations | 4.25 | 4.18 | (0.17 | ) | 2.31 | 4.05 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.35 | ) | (0.34 | ) | (0.20 | ) | (0.32 | ) | (0.22 | ) | ||||||||||
Net asset value at end of year | $ | 27.82 | $ | 23.92 | $ | 20.08 | $ | 20.45 | $ | 18.46 | ||||||||||
Market price at end of year(b) | $ | 27.79 | $ | 23.90 | $ | 20.07 | $ | 20.44 | $ | 18.45 | ||||||||||
Net Asset Value Total Return(c) | 17.89 | % | 21.07 | % | (0.66 | )% | 12.76 | % | 27.90 | % | ||||||||||
Market Price Total Return(c) | 17.86 | % | 21.03 | % | (0.66 | )% | 12.77 | % | 28.09 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 36,167 | $ | 20,330 | $ | 18,071 | $ | 22,492 | $ | 17,539 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers(d) | 0.64 | % | 0.66 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers(d) | 0.91 | % | 1.10 | % | 1.21 | % | 1.30 | % | 1.25 | % | ||||||||||
Net investment income, after Waivers | 1.20 | % | 1.66 | % | 1.33 | % | 1.50 | % | 1.26 | % | ||||||||||
Portfolio turnover rate(e) | 232 | % | 118 | % | 102 | % | 59 | % | 97 | % |
PowerShares DWA Healthcare Momentum Portfolio (PTH)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 38.76 | $ | 32.29 | $ | 31.41 | $ | 25.68 | $ | 17.89 | ||||||||||
Net investment income (loss)(a) | 0.00 | (f) | 0.43 | 0.02 | (0.05 | ) | 0.03 | |||||||||||||
Net realized and unrealized gain (loss) on investments | 6.73 | 6.39 | 0.86 | 5.78 | 7.84 | |||||||||||||||
Total from investment operations | 6.73 | 6.82 | 0.88 | 5.73 | 7.87 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.15 | ) | (0.35 | ) | — | — | (0.05 | ) | ||||||||||||
Return of capital | — | — | — | — | (0.03 | ) | ||||||||||||||
Total distributions | (0.15 | ) | (0.35 | ) | — | — | (0.08 | ) | ||||||||||||
Net asset value at end of year | $ | 45.34 | $ | 38.76 | $ | 32.29 | $ | 31.41 | $ | 25.68 | ||||||||||
Market price at end of year(b) | $ | 45.34 | $ | 38.69 | $ | 32.30 | $ | 31.44 | $ | 25.67 | ||||||||||
Net Asset Value Total Return(c) | 17.41 | % | 21.31 | % | 2.80 | % | 22.31 | % | 44.09 | % | ||||||||||
Market Price Total Return(c) | 17.62 | % | 21.06 | % | 2.74 | % | 22.48 | % | 44.28 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 106,560 | $ | 60,071 | $ | 37,134 | $ | 62,822 | $ | 97,598 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | % | 0.65 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.68 | % | 0.74 | % | 0.82 | % | 0.84 | % | 0.72 | % | ||||||||||
Net investment income (loss), after Waivers | 0.01 | % | 1.26 | % | 0.05 | % | (0.21 | )% | 0.13 | % | ||||||||||
Portfolio turnover rate(e) | 278 | % | 93 | % | 99 | % | 63 | % | 79 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the investment companies in which the Fund invests. Estimated investment company expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the investment companies and are deducted from the value of the funds that the Fund invests in. The effect of the estimated investment company expenses that the Fund bears indirectly is included in the Fund’s total return. |
(e) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. For the fiscal year ended April 30, 2014, the portfolio turnover calculation for PowerShares DWA Financial Momentum Portfolio and PowerShares DWA Healthcare Momentum Portfolio includes the value of securities purchased and sold in the effort to realign the Funds’ portfolio holdings due to the underlying index change. |
(f) | Amount represents less than $0.005. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares DWA Industrials Momentum Portfolio (PRN)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 36.74 | $ | 30.02 | $ | 32.47 | $ | 25.21 | $ | 18.85 | ||||||||||
Net investment income(a) | 0.19 | 0.52 | 0.22 | 0.17 | 0.20 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 9.72 | 6.89 | (2.48 | ) | 7.29 | 6.48 | ||||||||||||||
Total from investment operations | 9.91 | 7.41 | (2.26 | ) | 7.46 | 6.68 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.18 | ) | (0.65 | ) | (0.19 | ) | (0.20 | ) | (0.32 | ) | ||||||||||
Return of capital | — | (0.04 | ) | — | — | — | ||||||||||||||
Total distributions | (0.18 | ) | (0.69 | ) | (0.19 | ) | (0.20 | ) | (0.32 | ) | ||||||||||
Net asset value at end of year | $ | 46.47 | $ | 36.74 | $ | 30.02 | $ | 32.47 | $ | 25.21 | ||||||||||
Market price at end of year(b) | $ | 46.43 | $ | 36.72 | $ | 30.00 | $ | 32.48 | $ | 25.20 | ||||||||||
Net Asset Value Total Return(c) | 27.01 | % | 25.18 | % | (6.91 | )% | 29.83 | % | 35.73 | % | ||||||||||
Market Price Total Return(c) | 26.97 | % | 25.19 | % | (7.00 | )% | 29.92 | % | 35.89 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 169,622 | $ | 38,573 | $ | 30,017 | $ | 113,629 | $ | 32,779 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.65 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.66 | % | 0.92 | % | 0.80 | % | 0.88 | % | 0.82 | % | ||||||||||
Net investment income, after Waivers | 0.43 | % | 1.65 | % | 0.77 | % | 0.62 | % | 0.93 | % | ||||||||||
Portfolio turnover rate(d) | 285 | % | 116 | % | 129 | % | 48 | % | 121 | % |
PowerShares DWA Technology Momentum Portfolio (PTF)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 29.14 | $ | 27.29 | $ | 27.66 | $ | 23.60 | $ | 17.29 | ||||||||||
Net investment income (loss)(a) | 0.04 | 0.17 | 0.01 | (0.02 | ) | (0.05 | ) | |||||||||||||
Net realized and unrealized gain (loss) on investments | 3.32 | 1.88 | (0.38 | ) | 4.09 | 6.36 | ||||||||||||||
Total from investment operations | 3.36 | 2.05 | (0.37 | ) | 4.07 | 6.31 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.06 | ) | (0.20 | ) | — | — | — | |||||||||||||
Return of capital | — | — | — | (0.01 | ) | — | ||||||||||||||
Total distributions | (0.06 | ) | (0.20 | ) | — | (0.01 | ) | — | ||||||||||||
Net asset value at end of year | $ | 32.44 | $ | 29.14 | $ | 27.29 | $ | 27.66 | $ | 23.60 | ||||||||||
Market price at end of year(b) | $ | 32.45 | $ | 29.06 | $ | 27.28 | $ | 27.65 | $ | 23.59 | ||||||||||
Net Asset Value Total Return(c) | 11.52 | % | 7.59 | % | (1.34 | )% | 17.26 | % | 36.50 | % | ||||||||||
Market Price Total Return(c) | 11.86 | % | 7.34 | % | (1.34 | )% | 17.27 | % | 36.44 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 53,525 | $ | 32,053 | $ | 31,387 | $ | 49,793 | $ | 38,942 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.64 | % | 0.65 | % | 0.65 | % | 0.65 | % | 0.65 | % | ||||||||||
Expenses, prior to Waivers | 0.80 | % | 0.89 | % | 0.94 | % | 0.91 | % | 0.90 | % | ||||||||||
Net investment income (loss), after Waivers | 0.13 | % | 0.63 | % | 0.03 | % | (0.07 | )% | (0.24 | )% | ||||||||||
Portfolio turnover rate(d) | 263 | % | 95 | % | 108 | % | 67 | % | 71 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment return calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. For the fiscal year ended April 30, 2014, the portfolio turnover calculation for PowerShares DWA Industrials Momentum Portfolio and PowerShares DWA Technology Momentum Portfolio includes the value of securities purchased and sold in the effort to realign the Funds’ portfolio holdings due to the underlying index change. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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Financial Highlights (continued)
PowerShares DWA Utilities Momentum Portfolio (PUI)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of year | $ | 19.82 | $ | 16.69 | $ | 17.12 | $ | 14.96 | $ | 13.15 | ||||||||||
Net investment income(a) | 0.47 | 0.45 | 0.41 | 0.48 | 0.52 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 2.68 | 3.14 | (0.38 | ) | 2.19 | 2.04 | ||||||||||||||
Total from investment operations | 3.15 | 3.59 | 0.03 | 2.67 | 2.56 | |||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | (0.48 | ) | (0.46 | ) | (0.46 | ) | (0.51 | ) | (0.75 | ) | ||||||||||
Net asset value at end of year | $ | 22.49 | $ | 19.82 | $ | 16.69 | $ | 17.12 | $ | 14.96 | ||||||||||
Market price at end of year(b) | $ | 22.47 | $ | 19.79 | $ | 16.66 | $ | 17.13 | $ | 14.96 | ||||||||||
Net Asset Value Total Return(c) | 16.27 | % | 21.90 | % | 0.26 | % | 18.36 | % | 19.79 | % | ||||||||||
Market Price Total Return(c) | 16.35 | % | 21.94 | % | 0.02 | % | 18.42 | % | 19.97 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of year (000’s omitted) | $ | 41,601 | $ | 42,604 | $ | 43,393 | $ | 47,089 | $ | 38,139 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses, after Waivers | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | 0.63 | % | ||||||||||
Expenses, prior to Waivers | 0.77 | % | 0.81 | % | 0.77 | % | 0.89 | % | 0.95 | % | ||||||||||
Net investment income, after Waivers | 2.31 | % | 2.54 | % | 2.45 | % | 3.12 | % | 3.71 | % | ||||||||||
Portfolio turnover rate(d) | 131 | % | 48 | % | 71 | % | 68 | % | 81 | % |
PowerShares NASDAQ Internet Portfolio (PNQI)
Year Ended April 30, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Per Share Operating Performance: | ||||||||||||||||||||
Net asset value at beginning of period | $ | 46.09 | $ | 41.08 | $ | 41.37 | $ | 27.99 | $ | 17.89 | ||||||||||
Net investment income (loss)(a) | (0.27 | ) | (0.01 | ) | (0.08 | ) | (0.06 | ) | (0.12 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | 15.80 | 5.04 | (0.21 | ) | 13.44 | 10.22 | ||||||||||||||
Total from investment operations | 15.53 | 5.03 | (0.29 | ) | 13.38 | 10.10 | ||||||||||||||
Distributions to shareholders from: | ||||||||||||||||||||
Net investment income | — | (0.02 | ) | — | — | — | ||||||||||||||
Return of capital | — | — | — | — | — | |||||||||||||||
Total distributions | — | (0.02 | ) | — | — | — | ||||||||||||||
Net asset value at end of period | $ | 61.62 | $ | 46.09 | $ | 41.08 | $ | 41.37 | $ | 27.99 | ||||||||||
Market price at end of period(b) | $ | 61.51 | $ | 46.08 | $ | 41.08 | $ | 41.40 | $ | 28.01 | ||||||||||
Net Asset Value Total Return(c) | 33.70 | % | 12.26 | % | (0.70 | )% | 47.80 | % | 56.46 | % | ||||||||||
Market Price Total Return(c) | 33.48 | % | 12.23 | % | (0.77 | )% | 47.81 | % | 56.65 | % | ||||||||||
Ratios/Supplemental Data: | ||||||||||||||||||||
Net assets at end of period (000’s omitted) | $ | 289,628 | $ | 64,525 | $ | 63,678 | $ | 45,507 | $ | 15,396 | ||||||||||
Ratio to average net assets of: | ||||||||||||||||||||
Expenses | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | ||||||||||
Net investment income (loss) | (0.42 | )% | (0.02 | )% | (0.22 | )% | (0.17 | )% | (0.46 | )% | ||||||||||
Portfolio turnover rate(d) | 21 | % | 20 | % | 23 | % | 20 | % | 23 | % |
(a) | Based on average shares outstanding. |
(b) | The mean between the last bid and ask prices. |
(c) | Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Net asset value total return includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized. |
(d) | Portfolio turnover rate is not annualized and does not include securities received or delivered from processing creations or redemptions. For the fiscal year ended April 30, 2014, the portfolio turnover calculation for PowerShares DWA Utilities Momentum Portfolio includes the value of securities purchased and sold in the effort to realign the Fund’s portfolio holdings due to the underlying index change. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
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PowerShares Exchange-Traded Fund Trust
April 30, 2014
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the “Trust”) was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). As of April 30, 2014, the Trust offered fifty-three portfolios. This report includes the following portfolios:
Full Name | Short Name | |
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) (formerly, PowerShares Dynamic Basic Materials Sector Portfolio) | “DWA Basic Materials Momentum Portfolio” | |
PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ) (formerly, PowerShares Dynamic Consumer Discretionary Sector Portfolio) | “DWA Consumer Cyclicals Momentum Portfolio” | |
PowerShares DWA Consumer Staples Momentum Portfolio (PSL) (formerly, PowerShares Dynamic Consumer Staples Sector Portfolio) | “DWA Consumer Staples Momentum Portfolio” | |
PowerShares DWA Energy Momentum Portfolio (PXI) (formerly, PowerShares Dynamic Energy Sector Portfolio) | “DWA Energy Momentum Portfolio” | |
PowerShares DWA Financial Momentum Portfolio (PFI) (formerly, PowerShares Dynamic Financial Sector Portfolio) | “DWA Financial Momentum Portfolio” | |
PowerShares DWA Healthcare Momentum Portfolio (PTH) (formerly, PowerShares Dynamic Healthcare Sector Portfolio) | “DWA Healthcare Momentum Portfolio” | |
PowerShares DWA Industrials Momentum Portfolio (PRN) (formerly, PowerShares Dynamic Industrials Sector Portfolio) | “DWA Industrials Momentum Portfolio” | |
PowerShares DWA Technology Momentum Portfolio (PTF) (formerly, PowerShares Dynamic Technology Sector Portfolio) | “DWA Technology Momentum Portfolio” | |
PowerShares DWA Utilities Momentum Portfolio (PUI) (formerly, PowerShares Dynamic Utilities Portfolio) | “DWA Utilities Momentum Portfolio” | |
PowerShares NASDAQ Internet Portfolio (PNQI) | “NASDAQ Internet Portfolio” |
Each portfolio (each, a “Fund”, and collectively, the “Funds”) represents a separate series of the Trust. The shares of the Funds are referred to herein as “Shares” or “Fund’s Shares.” Each Fund’s Shares are listed and traded on NYSE Arca, Inc., except for Shares of NASDAQ Internet Portfolio, which are listed and traded on The NASDAQ Stock Market LLC.
The market prices of each Fund’s Shares may differ to some degree from the Fund’s net asset value (“NAV”). Unlike conventional mutual funds, each Fund issues and redeems Shares on a continuous basis, at NAV, only in a large specified number of Shares, each called a “Creation Unit.” Creation Units are issued and redeemed in exchange for the deposit or delivery of a basket of securities (“Deposit Securities”). Except when aggregated in Creation Units by Authorized Participants, the Shares are not individually redeemable securities of the Funds.
The investment objective of each Fund is to seek investment results that generally correspond (before fees and expenses) to the price and yield of its respective index listed below (each, an “Underlying Index”):
Fund | Underlying Index | |
DWA Basic Materials Momentum Portfolio | DWA Basic Materials Technical LeadersTM Index | |
DWA Consumer Cyclicals Momentum Portfolio | DWA Consumer Cyclicals Technical LeadersTM Index | |
DWA Consumer Staples Momentum Portfolio | DWA Consumer Staples Technical LeadersTM Index | |
DWA Energy Momentum Portfolio | DWA Energy Technical LeadersTM Index | |
DWA Financial Momentum Portfolio | DWA Financials Technical LeadersTM Index | |
DWA Healthcare Momentum Portfolio | DWA Healthcare Technical LeadersTM Index | |
DWA Industrials Momentum Portfolio | DWA Industrials Technical LeadersTM Index | |
DWA Technology Momentum Portfolio | DWA Technology Technical LeadersTM Index | |
DWA Utilities Momentum Portfolio | DWA Utilities Technical LeadersTM Index | |
NASDAQ Internet Portfolio | NASDAQ Internet IndexSM |
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Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates. In addition, the Funds monitor for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policies.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and ask prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and ask prices. For purposes of determining NAV per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end of day NAV per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Securities with a demand feature exercisable within one to seven days are valued at par. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that Invesco PowerShares Capital Management LLC (the “Adviser”) determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith following procedures approved by the Board of Trustees. Issuer-specific events, market trends, bid/ask quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
Each Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain of each Fund’s investments.Valuations change in response to many factors, including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor
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perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. Other Risks
Index Risk. Unlike many investment companies, the Funds do not utilize investing strategies that seek returns in excess of their Underlying Indexes. Therefore, a Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its respective Underlying Index, even if that security generally is underperforming.
Equity Risk. Equity risk is the risk that the value of the securities that each Fund holds will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities a Fund holds participate or factors relating to specific companies in which the Funds invest. For example, an adverse event, such as an unfavorable earnings report, may depress the value of securities a Fund holds; the price of securities may be particularly sensitive to general movements in the stock market; or a drop in the stock market may depress the price of most or all of the securities a Fund holds. In addition, securities of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition.
Industry Concentration Risk. In following its methodology, each Fund’s Underlying Index from time to time may be concentrated to a significant degree in securities of issuers located in a single industry or a sector. To the extent that an Underlying Index concentrates in the securities of issuers in a particular industry or sector, each Fund will also concentrate its investments to approximately the same extent. By concentrating its investments in an industry or sector, a Fund may face more risks than if it were diversified broadly over numerous industries or sectors. In addition, at times, an industry or sector may be out of favor and underperform other industries or the market as a whole. Any factors detrimental to the performance of such industry or sector will disproportionately impact a Fund’s NAV.
Non-Diversified Fund Risk. NASDAQ Internet Portfolio is non-diversified and can invest a greater portion of its assets in securities of individual issuers than diversified funds. As a result, changes in the market value of a single investment could cause greater fluctuations in Share price than would occur in a diversified fund. This may increase the Fund’s volatility and cause the performance of a relatively small number of issuers to have a greater impact on the Fund’s performance.
Non-Correlation Risk. Each Fund’s return may not match the return of its Underlying Index for a number of reasons. For example, each Fund incurs operating expenses not applicable to its Underlying Index, and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of its Underlying Index. In addition, the performance of each Fund and its Underlying Index may vary due to asset valuation differences and differences between each Fund’s portfolio and its Underlying Index resulting from legal restrictions, cost or liquidity constraints.
Small and Medium Capitalization Company Risk. Investing in securities of small and medium capitalization companies involves greater risk than customarily is associated with investing in larger, more established companies. These companies’ securities may be more volatile and less liquid than those of more established companies. These securities may have returns that vary, sometimes significantly, from the overall securities market. Often small and medium capitalization companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and to distribute substantially all of the Fund’s taxable earnings to its shareholders. As such, the Funds will not be subject to federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements.
Each Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed each Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These timing differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and passive foreign investment company adjustments, if any.
The Funds file U.S. federal tax returns and tax returns in certain other jurisdictions. Generally, a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Transactions and Investment Income
Investment transactions are accounted for on a trade date basis. Realized gains and losses from the sale or disposition of securities are computed on the specific identified cost basis. Interest income is recorded on the accrual basis. Dividend income (net of withholding tax,
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if any) is recorded on the ex-dividend date. Realized gains, dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date.
E. Expenses
Expenses of the Trust that are directly identifiable to a specific Fund are applied to that Fund. Expenses of the Trust that are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund (except for NASDAQ Internet Portfolio) is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, sub-licensing fees related to its respective Underlying Index, any distribution fees or expenses, litigation expenses, fees payable to the Trust’s Board members who are not “interested persons” (as defined in the 1940 Act) of the Trust (the “Independent Trustees”) or the Adviser expenses incurred in connection with the Board members’ services, including travel expenses and legal fees of counsel for the Independent Trustees, acquired fund fees and expenses, if any, and extraordinary expenses.
NASDAQ Internet Portfolio has agreed to pay an annual unitary management fee to the Adviser. Out of the unitary management fee, the Adviser has agreed to pay for substantially all expenses of the Fund, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for advisory fees, distribution fees, if any, brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses (including acquired fund fees and expenses, if any).
To the extent a Fund invests in other investment companies, the expenses shown in the accompanying financial statements reflect the expenses of the Fund and do not include any expenses of the investment companies in which it invests. The effects of such investment companies’ expenses are included in the realized and unrealized gain or loss on the investments in the investment companies.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and records such dividends on ex-dividend date. Generally, each Fund distributes net realized taxable capital gains, if any, annually in cash and records them on ex-dividend date. Such distributions on a tax basis are determined in conformity with federal income tax regulations, which may differ from GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund’s financial statements as a tax return of capital at fiscal period-end.
G. Securities Lending
DWA Basic Materials Momentum Portfolio and NASDAQ Internet Portfolio may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by cash collateral equal to no less than 102% of the market value of the loaned securities determined daily by the securities lending provider. Cash collateral received in connection with these loans is invested in an affiliated money market fund and is shown as such on the Schedule of Investments. It is the policy of the Fund to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. Lending securities entails a risk of loss to a Fund if, and to the extent that, the market value of the securities loaned were to increase, and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. A Fund could experience delays and costs in gaining access to the collateral. A Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Securities lending income on the Statements of Operations. The aggregate value of securities out on loan is shown on the Statements of Assets and Liabilities, if any.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser pursuant to which the Adviser has overall responsibility for the selection and ongoing monitoring of the Funds’ investments, managing the Funds’ business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund (except for NASDAQ Internet Portfolio) has agreed to pay the Adviser an annual fee of 0.50% of the Fund’s average daily net assets. As compensation for its services, NASDAQ Internet Portfolio has agreed to pay the Adviser an annual unitary management fee of 0.60% of the Fund’s average daily net assets. Out of the unitary management fee, the Adviser has agreed to pay for substantially all expenses of NASDAQ Internet Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for advisory fees, distribution fees, if any, brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses (including acquired fund fees and expenses, if any).
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The Adviser has entered into an Amended and Restated Excess Expense Agreement (the “Expense Agreement”) with the Trust on behalf of each Fund, pursuant to which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses (excluding interest expenses, brokerage commissions and other trading expenses, offering costs, taxes, acquired fund fees and expenses, if any, and extraordinary expenses) of each Fund other than NASDAQ Internet Portfolio from exceeding 0.60% of the Fund’s average daily net assets per year (the “Expense Cap”), through at least August 31, 2015. Offering costs excluded from the Expense Cap are: (a) initial legal fees pertaining to the Funds’ Shares offered for sale; (b) initial Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange. Prior to February 19, 2014, sub-licensing fees for each Fund (except for NASDAQ Internet Portfolio) were excluded from the expenses subject to the Expense Cap. Unless the Adviser continues the Expense Agreement, it will terminate on August 31, 2015. The Expense Agreement cannot be terminated during its term. The Adviser did not waive fees and/or pay Fund expenses during the period under this Expense Cap for DWA Energy Momentum Portfolio.
Further, through August 31, 2015, the Adviser has contractually agreed to waive a portion of the Fund’s management fee in an amount equal to 100% of the net advisory fees an affiliate of the Adviser receives that are attributable to certain of the Fund’s investments in money market funds managed by that affiliate (excluding investments of cash collateral from securities lending). The Adviser cannot discontinue this waiver prior to its expiration.
For the fiscal year ended April 30, 2014, the Adviser waived fees and/or paid Fund expenses for each Fund, in the following amounts:
DWA Basic Materials Momentum Portfolio | $ | 32,876 | ||
DWA Consumer Cyclicals Momentum Portfolio | 72,348 | |||
DWA Consumer Staples Momentum Portfolio | 58,726 | |||
DWA Energy Momentum Portfolio | 121 | |||
DWA Financial Momentum Portfolio | 69,932 | |||
DWA Healthcare Momentum Portfolio | 38,442 | |||
DWA Industrials Momentum Portfolio | 30,676 | |||
DWA Technology Momentum Portfolio | 60,150 | |||
DWA Utilities Momentum Portfolio | 53,886 | |||
NASDAQ Internet Portfolio | 88 |
The Expense Agreement provides that the fees waived or expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee was waived or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above. The Expense Agreement does not apply to NASDAQ Internet Portfolio.
For the following Funds, the amounts available for potential future recapture by the Adviser under the Expense Agreement and the expiration schedule at April 30, 2014 are as follows:
Total Potential Recapture Amounts | Potential Recapture Amounts Expiring | |||||||||||||||
04/30/15 | 04/30/16 | 04/30/17 | ||||||||||||||
DWA Basic Materials Momentum Portfolio | $ | 153,057 | $ | 73,906 | $ | 46,379 | $ | 32,772 | ||||||||
DWA Consumer Cyclicals Momentum Portfolio | 255,344 | 106,566 | 76,493 | 72,285 | ||||||||||||
DWA Consumer Staples Momentum Portfolio | 213,839 | 91,705 | 63,480 | 58,654 | ||||||||||||
DWA Energy Momentum Portfolio | 45,360 | 13,542 | 31,818 | — | ||||||||||||
DWA Financial Momentum Portfolio | 257,482 | 104,587 | 83,041 | 69,854 | ||||||||||||
DWA Healthcare Momentum Portfolio | 175,598 | 95,928 | 41,317 | 38,353 | ||||||||||||
DWA Industrials Momentum Portfolio | 194,391 | 81,718 | 82,100 | 30,573 | ||||||||||||
DWA Technology Momentum Portfolio | 226,150 | 93,489 | 72,589 | 60,072 | ||||||||||||
DWA Utilities Momentum Portfolio | 203,115 | 77,540 | 71,758 | 53,817 |
The Trust has entered into a Distribution Agreement with Invesco Distributors, Inc. (the “Distributor”), which serves as the distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in the Shares. The Funds are not charged any fees pursuant to the Distribution Agreement. The Distributor is an affiliate of the Adviser.
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The Adviser has entered into a licensing agreement for each Fund with the following entities (each, a “Licensor”):
Full Name | Licensor | |
DWA Basic Materials Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Consumer Cyclicals Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Consumer Staples Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Energy Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Financial Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Healthcare Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Industrials Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Technology Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
DWA Utilities Momentum Portfolio | Dorsey Wright & Associates, Inc.* | |
NASDAQ Internet Portfolio | NASDAQ OMX Group, Inc. |
* | Effective February 19, 2014, Dorsey Wright & Associates, Inc. replaced NYSE Arca, Inc. as the Index Provider of the Index. |
Each Underlying Index name trademark is owned by its respective Licensor. These trademarks have been licensed to the Adviser for use by the Funds. Each Fund is entitled to use its Underlying Index pursuant to the Trust’s sub-licensing agreement with the Adviser. The Funds (except for NASDAQ Internet Portfolio) are required to pay the sub-licensing fees that are shown on the Statements of Operations. The Funds are not sponsored, endorsed, sold or promoted by the Licensors, and the Licensors make no representation regarding the advisability of investing in any of the Funds.
The Trust has entered into service agreements whereby The Bank of New York Mellon, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian, fund accountant and transfer agent for each Fund.
Note 4. Investments in Affiliates
Each Fund’s Adviser is a wholly-owned subsidiary of Invesco Ltd., and therefore Invesco Ltd. is considered to be affiliated. The table below shows the Fund’s transactions in, and earnings from, its investments in Invesco Ltd. for the fiscal year ended April 30, 2014.
DWA Financial Momentum Portfolio
Value April 30, 2013 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain | Value April 30, 2014 | Dividend Income | ||||||||||||||||||||||
Invesco Ltd. | $ | — | $ | 1,563,511 | $ | (287,542 | ) | $ | 35,336 | $ | 5,021 | $ | 1,316,326 | $ | — |
Note 5. Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — Prices | are determined using quoted prices in an active market for identical assets. |
Level 2 — Prices | are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — Prices | are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
As of April 30, 2014, all of the securities in each Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
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Note 6. Distributions to Shareholders and Tax Components of Net Assets
Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended April 30, 2014 and 2013:
2014 | 2013 | |||||||||||||||
Ordinary Income | Return of Capital | Ordinary Income | Return of Capital | |||||||||||||
DWA Basic Materials Momentum Portfolio | $ | 855,864 | $ | — | $ | 1,050,895 | $ | — | ||||||||
DWA Consumer Cyclicals Momentum Portfolio | 129,334 | — | 332,955 | — | ||||||||||||
DWA Consumer Staples Momentum Portfolio | 519,961 | — | 761,607 | — | ||||||||||||
DWA Energy Momentum Portfolio | 942,939 | — | 1,757,378 | — | ||||||||||||
DWA Financial Momentum Portfolio | 327,300 | — | 308,168 | �� | — | |||||||||||
DWA Healthcare Momentum Portfolio | 245,316 | — | 519,661 | — | ||||||||||||
DWA Industrials Momentum Portfolio | 341,196 | — | 607,832 | 39,658 | ||||||||||||
DWA Technology Momentum Portfolio | 65,769 | — | 220,275 | — | ||||||||||||
DWA Utilities Momentum Portfolio | 929,718 | — | 1,054,339 | — | ||||||||||||
NASDAQ Internet Portfolio | — | — | 27,038 | — |
Tax Components of Net Assets at Fiscal Year-End:
Undistributed Ordinary Income | Temporary Book/Tax Differences | Net Unrealized Appreciation (Depreciation)— Investment Securities | Capital Loss Carryforward | Late-Year Ordinary/Post- October Deferrals* | Shares of Beneficial Interest | Total Net Assets | ||||||||||||||||||||||
DWA Basic Materials Momentum Portfolio | $ | 253,116 | $ | (11,626 | ) | $ | 6,357,007 | $ | (18,383,951 | ) | $ | — | $ | 105,975,482 | $ | 94,190,028 | ||||||||||||
DWA Consumer Cyclicals Momentum Portfolio | 9,866 | (9,905 | ) | (1,446,578 | ) | (9,429,417 | ) | — | 56,629,677 | 45,753,643 | ||||||||||||||||||
DWA Consumer Staples Momentum Portfolio | 179,741 | (10,750 | ) | (431,370 | ) | (7,834,946 | ) | — | 46,835,742 | 38,738,417 | ||||||||||||||||||
DWA Energy Momentum Portfolio | 510,057 | (13,126 | ) | 23,031,334 | (21,404,161 | ) | — | 212,316,639 | 214,440,743 | |||||||||||||||||||
DWA Financial Momentum Portfolio | 51,988 | (9,971 | ) | (3,975 | ) | (10,155,089 | ) | — | 46,284,107 | 36,167,060 | ||||||||||||||||||
DWA Healthcare Momentum Portfolio** | — | (12,862 | ) | (4,894,102 | ) | (48,545,857 | ) | (142,744 | ) | 160,155,997 | 106,560,432 | |||||||||||||||||
DWA Industrials Momentum Portfolio | 88,358 | (11,596 | ) | (2,389,765 | ) | (36,801,221 | ) | — | 208,736,454 | 169,622,230 | ||||||||||||||||||
DWA Technology Momentum Portfolio** | — | (10,733 | ) | (3,183,663 | ) | (29,320,284 | ) | (31,259 | ) | 86,071,152 | 53,525,213 | |||||||||||||||||
DWA Utilities Momentum Portfolio | 98,418 | (11,058 | ) | 4,563,001 | (15,033,996 | ) | — | 51,984,848 | 41,601,213 | |||||||||||||||||||
NASDAQ Internet Portfolio** | — | — | (15,806,868 | ) | (3,781,630 | ) | (1,220,897 | ) | 310,437,072 | 289,627,677 |
* | Includes net capital losses incurred after October 31 (“Post-October Capital Losses”) and the combination of ordinary losses incurred after December 31 within the taxable year and specified losses incurred after October 31 within the taxable year (“Late-Year Ordinary Losses”), that are deemed to arise on the first business day of each Fund’s next taxable year. |
** | The DWA Healthcare Momentum Portfolio, DWA Technology Momentum Portfolio and NASDAQ Internet Portfolio incurred and will elect to defer Late-Year Ordinary Losses of $142,744, $31,259 and $459,490 and Post-October Capital Losses of $0, $0 and $761,407, respectively. |
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Funds to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in 8 tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforward in the future may be limited under Internal Revenue Code and related regulations based on the results of future transactions.
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The following Funds have capital loss carryforwards as of April 30, 2014, which expire as follows:
Post-effective no expiration | ||||||||||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Short-term | Long-term | Total* | Utilized | ||||||||||||||||||||||||||||
DWA Basic Materials Momentum Portfolio | $ | — | $ | 205,528 | $ | 3,783,798 | $ | 4,534,904 | $ | 2,521,492 | $ | 5,924,971 | $ | 1,413,258 | $ | 18,383,951 | $ | 3,244,639 | ||||||||||||||||||
DWA Consumer Cyclicals Momentum Portfolio | — | 1,246,058 | 1,993,654 | — | 2,042,056 | 4,132,216 | 15,433 | 9,429,417 | — | |||||||||||||||||||||||||||
DWA Consumer Staples Momentum Portfolio | — | 562,037 | 2,156,980 | 3,935,363 | 1,180,566 | — | — | 7,834,946 | 3,786,332 | |||||||||||||||||||||||||||
DWA Energy Momentum Portfolio | — | 880,885 | 2,869,667 | 3,914,682 | 1,167,692 | 12,571,235 | — | 21,404,161 | 3,667,877 | |||||||||||||||||||||||||||
DWA Financial Momentum Portfolio | — | 614,940 | 1,821,971 | 4,413,894 | 1,979,006 | 1,325,278 | — | 10,155,089 | 1,797,635 | |||||||||||||||||||||||||||
DWA Healthcare Momentum Portfolio | — | 2,234,184 | 17,890,879 | 18,737,951 | 2,739,963 | 6,942,880 | — | 48,545,857 | 3,245,322 | |||||||||||||||||||||||||||
DWA Industrials Momentum Portfolio | — | 1,476,057 | 6,525,387 | 21,245,288 | 2,746,746 | 4,807,743 | — | 36,801,221 | 6,643,650 | |||||||||||||||||||||||||||
DWA Technology Momentum Portfolio | — | 2,465,875 | 8,220,697 | 7,658,564 | 3,016,840 | 7,958,308 | — | 29,320,284 | 861,059 | |||||||||||||||||||||||||||
DWA Utilities Momentum Portfolio | 430,964 | 2,124,736 | 1,366,073 | 5,885,935 | 874,386 | 3,694,092 | 657,810 | 15,033,996 | 2,340,748 | |||||||||||||||||||||||||||
NASDAQ Internet Portfolio | — | — | — | 3,360 | 74,863 | 1,343,592 | 2,359,815 | 3,781,630 | — |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
Note 7. Investment Transactions
For the fiscal year ended April 30, 2014, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, U.S. Treasury obligations, money market funds and in-kind transactions, were as follows:
Purchases | Sales | |||||||
DWA Basic Materials Momentum Portfolio | $ | 126,571,015 | $ | 125,649,255 | ||||
DWA Consumer Cyclicals Momentum Portfolio | 65,765,792 | 65,023,914 | ||||||
DWA Consumer Staples Momentum Portfolio | 69,183,484 | 68,123,362 | ||||||
DWA Energy Momentum Portfolio | 321,318,009 | 319,758,904 | ||||||
DWA Financial Momentum Portfolio | 60,691,083 | 61,066,606 | ||||||
DWA Healthcare Momentum Portfolio | 232,965,206 | 232,438,529 | ||||||
DWA Industrials Momentum Portfolio | 286,023,658 | 285,644,426 | ||||||
DWA Technology Momentum Portfolio | 98,362,264 | 98,358,872 | ||||||
DWA Utilities Momentum Portfolio | 51,777,355 | 51,556,060 | ||||||
NASDAQ Internet Portfolio | 43,205,275 | 45,056,325 |
For the fiscal year ended April 30, 2014, in-kind transactions associated with creations and redemptions were as follows:
Cost of Securities Received | Value of Securities Delivered | |||||||
DWA Basic Materials Momentum Portfolio | $ | 73,671,805 | $ | 74,870,897 | ||||
DWA Consumer Cyclicals Momentum Portfolio | 59,405,481 | 40,664,798 | ||||||
DWA Consumer Staples Momentum Portfolio | 40,588,440 | 43,763,057 | ||||||
DWA Energy Momentum Portfolio | 211,364,937 | 172,921,277 | ||||||
DWA Financial Momentum Portfolio | 41,778,500 | 28,712,635 | ||||||
DWA Healthcare Momentum Portfolio | 129,895,861 | 90,427,817 | ||||||
DWA Industrials Momentum Portfolio | 216,225,778 | 98,668,127 | ||||||
DWA Technology Momentum Portfolio | 56,472,317 | 36,627,532 | ||||||
DWA Utilities Momentum Portfolio | 16,678,039 | 23,168,317 | ||||||
NASDAQ Internet Portfolio | 317,651,279 | 105,458,040 |
Gains (losses) on in-kind transactions are generally not considered taxable gains (losses) for federal income tax purposes.
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At April 30, 2014, the aggregate cost and the net unrealized appreciation (depreciation) of investments for tax purposes were as follows:
Cost | Net Unrealized Appreciation (Depreciation) | Gross Unrealized Appreciation | Gross Unrealized (Depreciation) | |||||||||||||
DWA Basic Materials Momentum Portfolio | $ | 88,664,609 | $ | 6,357,007 | $ | 7,639,610 | $ | (1,282,603 | ) | |||||||
DWA Consumer Cyclicals Momentum Portfolio | 47,257,153 | (1,446,578 | ) | 1,139,476 | (2,586,054 | ) | ||||||||||
DWA Consumer Staples Momentum Portfolio | 39,229,746 | (431,370 | ) | 1,189,075 | (1,620,445 | ) | ||||||||||
DWA Energy Momentum Portfolio | 191,529,288 | 23,031,334 | 23,511,756 | (480,422 | ) | |||||||||||
DWA Financial Momentum Portfolio | 36,217,946 | (3,975 | ) | 1,117,598 | (1,121,573 | ) | ||||||||||
DWA Healthcare Momentum Portfolio | 111,559,256 | (4,894,102 | ) | 4,063,537 | (8,957,639 | ) | ||||||||||
DWA Industrials Momentum Portfolio | 172,140,748 | (2,389,765 | ) | 3,541,974 | (5,931,739 | ) | ||||||||||
DWA Technology Momentum Portfolio | 56,783,253 | (3,183,663 | ) | 2,382,798 | (5,566,461 | ) | ||||||||||
DWA Utilities Momentum Portfolio | 37,062,249 | 4,563,001 | 4,622,707 | (59,706 | ) | |||||||||||
NASDAQ Internet Portfolio | 324,445,005 | (15,806,868 | ) | 8,867,424 | (24,674,292 | ) |
Note 8. Reclassification of Permanent Differences
Primarily as a result of differing book/tax treatment of in-kind transactions on April 30, 2014, amounts were reclassified between undistributed net investment income (loss), undistributed net realized gain (loss) and shares of beneficial interest. These reclassifications had no effect on the net assets of each Fund. For the fiscal year ended April 30, 2014, the reclassifications were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Net Realized Gain (Loss) | Shares of Beneficial Interest | ||||||||||
DWA Basic Materials Momentum Portfolio | $ | 117,269 | $ | (12,807,459 | ) | $ | 12,690,190 | |||||
DWA Consumer Cyclicals Momentum Portfolio | (3,498 | ) | (5,980,059 | ) | 5,983,557 | |||||||
DWA Consumer Staples Momentum Portfolio | — | (7,459,886 | ) | 7,459,886 | ||||||||
DWA Energy Momentum Portfolio | 382,977 | (22,258,674 | ) | 21,875,697 | ||||||||
DWA Financial Momentum Portfolio | (5,030 | ) | (4,036,105 | ) | 4,041,135 | |||||||
DWA Healthcare Momentum Portfolio | — | (15,064,540 | ) | 15,064,540 | ||||||||
DWA Industrials Momentum Portfolio | — | (14,203,496 | ) | 14,203,496 | ||||||||
DWA Technology Momentum Portfolio | 885 | (7,386,214 | ) | 7,385,329 | ||||||||
DWA Utilities Momentum Portfolio | — | (4,154,931 | ) | 4,154,931 | ||||||||
NASDAQ Internet Portfolio | 456,752 | (37,853,118 | ) | 37,396,366 |
Note 9. Trustees’ and Officer’s Fees
Trustees’ and Officer’s Fees include amounts accrued by the Funds to pay remuneration to the Independent Trustees and Officer of the Funds. The Adviser, as a result of the unitary management fee, pays for such compensation for NASDAQ Internet Portfolio. The Trustee who is an “interested person” (the “Non-Independent Trustee”) of the Trust does not receive any Trustees’ fees.
The Trust has adopted a deferred compensation plan (the “Plan”). Under the Plan, an Independent Trustee who has executed a Deferred Fee Agreement (a “Participating Trustee”) may defer receipt of all or a portion of his compensation (“Deferral Fees”). Such Deferral Fees are deemed to be invested in select PowerShares Funds. The Deferral Fees payable to the Participating Trustee are valued as of the date such Deferral Fees would have been paid to the Participating Trustee. The value increases with contributions or with increases in the value of the Shares selected, and the value decreases with distributions or with declines in the value of the Shares selected. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Funds.
Note 10. Capital
Shares are created and redeemed by each Fund only in Creation Units of 50,000 Shares. Only Authorized Participants are permitted to purchase or redeem Creation Units from the Funds. Such transactions are generally permitted in exchange for Deposit Securities, with a balancing cash component to equate the transaction to the NAV per Share of a Fund of the Trust on the transaction date. However, for all Funds, cash in an amount equivalent to the value of certain securities may be substituted, generally when the securities are not available in sufficient quantity for delivery, not eligible for trading by the Authorized Participant or as a result of other market circumstances.
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To the extent that the Funds permit transactions in exchange for Deposit Securities, each Fund may issue Shares in advance of receipt of Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to 105% of the market value of the missing Deposit Securities. In accordance with each Fund’s Participant Agreement, Creation Units will be issued to an Authorized Participant, notwithstanding the fact that the corresponding Deposit Securities have not been received in part or in whole, in reliance on the undertaking of the Authorized Participant to deliver the missing Deposit Securities as soon as possible, which undertaking shall be secured by the Authorized Participant’s delivery and maintenance of collateral consisting of cash in the form of U.S. dollars in immediately available funds having a value (marked-to-market daily) at least equal to 105%, which the Adviser may change from time to time, of the value of the missing Deposit Securities.
Transactions in each Fund’s Shares are disclosed in detail in the Statements of Changes in Net Assets.
Note 11. Indemnifications
Under the Trust’s organizational documents, its officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Each Independent Trustee is also indemnified against certain liabilities arising out of the performance of his duties to the Trust pursuant to an Indemnification Agreement between the Independent Trustee and the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
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Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of PowerShares DWA Basic Materials Momentum Portfolio (formerly PowerShares Dynamic Basic Materials Sector Portfolio), PowerShares DWA Consumer Cyclicals Momentum Portfolio (formerly PowerShares Dynamic Consumer Discretionary Sector Portfolio), PowerShares DWA Consumer Staples Momentum Portfolio (formerly PowerShares Dynamic Consumer Staples Sector Portfolio), PowerShares DWA Energy Momentum Portfolio (formerly PowerShares Dynamic Energy Sector Portfolio), PowerShares DWA Financial Momentum Portfolio (formerly PowerShares Dynamic Financial Sector Portfolio), Powershares DWA Healthcare Momentum Portfolio (formerly PowerShares Dynamic Healthcare Sector Portfolio), PowerShares DWA Industrials Momentum Portfolio (formerly PowerShares Dynamic Industrials Sector Portfolio ), PowerShares DWA Technology Momentum Portfolio (formerly PowerShares Dynamic Technology Sector Portfolio), PowerShares DWA Utilities Momentum Portfolio (formerly PowerShares Dynamic Utilities Portfolio ) and PowerShares NASDAQ Internet Portfolio (each an individual portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the “Funds”) at April 30, 2014, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2014 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Chicago, IL
June 24, 2014
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As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust (excluding PowerShares NASDAQ Internet Portfolio), you incur advisory fees and other Fund expenses. As a shareholder of a Fund of the PowerShares NASDAQ Internet Portfolio, you incur a unitary management fee. In addition to the unitary management fee, a shareholder may pay distribution fees, if any, brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses (including acquired fund fees and expenses, if any). The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2014.
In addition to the fees and expenses which the PowerShares DWA Financial Momentum Portfolio (the “Portfolio”) bears directly, the Portfolio indirectly bears a pro rata share of the fees and expenses of the investment companies in which the Portfolio invests. The amount of fees and expenses incurred indirectly by the Portfolio will vary because the investment companies have varied expenses and fee levels and the Portfolio may own different proportions of the investment companies at different times. Estimated investment companies’ expenses are not expenses that are incurred directly by the Portfolio. They are expenses that are incurred directly by the investment companies and are deducted from the value of the investment companies the Portfolio invests in. The effect of the estimated investment companies’ expenses that you bear indirectly are included in the Portfolio’s total returns.
Actual Expenses
The first line in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following table provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as sales charges and brokerage commissions. Therefore, the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by a Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares DWA Basic Materials Momentum Portfolio (PYZ) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,087.84 | 0.63 | % | $ | 3.26 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares DWA Consumer Cyclicals Momentum Portfolio (PEZ) | ||||||||||||||||
Actual | 1,000.00 | 981.66 | 0.62 | 3.05 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.72 | 0.62 | 3.11 | ||||||||||||
PowerShares DWA Consumer Staples Momentum Portfolio (PSL) | ||||||||||||||||
Actual | 1,000.00 | 1,003.86 | 0.63 | 3.13 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares DWA Energy Momentum Portfolio (PXI) | ||||||||||||||||
Actual | 1,000.00 | 1,124.77 | 0.63 | 3.32 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 |
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Fees and Expenses (continued)
Beginning Account Value November 1, 2013 | Ending Account Value April 30, 2014 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period(1) | |||||||||||||
PowerShares DWA Financial Momentum Portfolio (PFI) | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,035.35 | 0.63 | % | $ | 3.18 | ||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares DWA Healthcare Momentum Portfolio (PTH) | ||||||||||||||||
Actual | 1,000.00 | 1,017.57 | 0.63 | 3.15 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares DWA Industrials Momentum Portfolio (PRN) | ||||||||||||||||
Actual | 1,000.00 | 1,036.61 | 0.63 | 3.18 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares DWA Technology Momentum Portfolio (PTF) | ||||||||||||||||
Actual | 1,000.00 | 972.03 | 0.63 | 3.08 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares DWA Utilities Momentum Portfolio (PUI) | ||||||||||||||||
Actual | 1,000.00 | 1,120.74 | 0.63 | 3.31 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.67 | 0.63 | 3.16 | ||||||||||||
PowerShares NASDAQ Internet Portfolio (PNQI) | ||||||||||||||||
Actual | 1,000.00 | 985.43 | 0.60 | 2.95 | ||||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,021.82 | 0.60 | 3.01 |
(1) | Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six-month period ended April 30, 2014. Expenses are calculated by multiplying the Fund’s annualized expense ratio by the average account value of the period, then multiplying the result by 181/365. Expense ratios for the most recent half-year may differ from expense ratios based on annualized data in the Financial Highlights. |
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Qualified Dividend Income* | Dividends-Received Deduction* | |||||||||
DWA Basic Materials Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Consumer Cyclicals Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Consumer Staples Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Energy Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Financial Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Healthcare Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Industrials Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Technology Momentum Portfolio | 100 | % | 100 | % | ||||||
DWA Utilities Momentum Portfolio | 100 | % | 100 | % | ||||||
NASDAQ Internet Portfolio | 0 | % | 0 | % |
* | The above percentages are based on ordinary income dividends paid to shareholders during the Fund’s fiscal year. |
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The Independent Trustees, the Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by each Trustee are shown below.
The Trustees and officers information is current as of April 30, 2014.
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Ronn R. Bagge (1958) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Founder and Principal, YQA Capital Management LLC (1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider). | 114 | None | |||||
Todd J. Barre (1957) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2010 | Assistant Professor of Business, Trinity Christian College (2010-Present); formerly Vice President and Senior Investment Strategist (2001-2008), Director of Open Architecture and Trading (2007-2008), Head of Fundamental Research (2004-2007) and Vice President and Senior Fixed Income Strategist (1994-2001), BMO Financial Group/Harris Private Bank. | 114 | None | |||||
Marc M. Kole (1960) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2006 | Chief Financial Officer, Hope Network (social services) (2008-2012); formerly, Assistant Vice President and Controller, Priority Health (health insurance) (2005-2008); Senior Vice President of Finance, United Healthcare (2004-2005); Senior Vice President of Finance, Oxford Health Plans (2000-2004). | 114 | None | |||||
Yung Bong Lim (1964) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Managing Partner, Residential Dynamics Group LLC (2008-Present); formerly, Managing Director, Citadel Investment Group, L.L.C. (1999-2007). | 114 | None | |||||
Philip M. Nussbaum (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (2004-Present). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Independent Trustees | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Independent Trustees | Other Directorships Held by Independent Trustees During the Past 5 Years | |||||
Gary R. Wicker (1961) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Trustee | Since 2013 | Senior Vice President of Global Finance and Chief Financial Officer at RBC Ministries (publishing company) (2013-Present); formerly, Executive Vice President and Chief Financial Officer, Zondervan Publishing (a division of Harper Collins/NewsCorp) (2007-2012); Senior Vice President and Group Controller (2005-2006), Senior Vice President and Chief Financial Officer (2003-2004), Chief Financial Officer (2001-2003), Vice President, Finance and Controller (1999-2001) and Assistant Controller (1997-1999), divisions of The Thomson Corporation (information services provider). | 114 | None | |||||
Donald H. Wilson (1959) c/o Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Chairman of the Board and Trustee | Chairman since 2012; Trustee since 2006 | Chairman, President and Chief Executive Officer, Community Financial Shares, Inc. and Community Bank—Wheaton/Glen Ellyn (subsidiary) (2013–Present); Chairman and Chief Executive Officer, Stone Pillar Advisers, Ltd. (2010-Present); formerly, Chief Operating Officer, AMCORE Financial, Inc. (bank holding company) (2007-2009); Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (2006-2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (1995-2006). | 114 | None |
* | This is the date the Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
The Non-Independent Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by the Non-Independent Trustee and the other directorships, if any, held by the Non-Independent Trustee are shown below.
Name, Address and Age of Non-Independent Trustee | Position(s) Held with Trust | Term of Office and Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Non-Independent Trustee | Other Directorships Held by Non-Independent Trustee During the Past 5 Years | |||||
Kevin M. Carome (1956) Invesco Ltd. Two Peachtree Pointe 1555 Peachtree St., N.E., Suite 1800 Atlanta, GA 30309 | Trustee | Since 2010 | Senior Managing Director, Secretary and General Counsel, Invesco Ltd. (2006-Present); Director, Invesco Advisers, Inc. (2009-Present); Director, Invesco Advisers, Inc., Invesco Finance PLC, INVESCO Funds Group, Inc., and Invesco Holding Company Limited; Director and Executive Vice President, Invesco Finance, Inc., Invesco Group Services, Inc., Invesco Investments (Bermuda) Ltd., Invesco North American Holdings, Inc., and IVZ, Inc.; Director and Secretary, IVZ Bahamas Private Limited; formerly, Senior Vice President, Secretary and General Counsel, Invesco Advisers, Inc. (2003-2005); Senior Vice President and General Counsel, Liberty Financial Companies, Inc. (2000-2001); General Counsel of certain investment management subsidiaries of Liberty Financial Companies, Inc. (1998-2000); Associate General Counsel, Liberty Financial Companies, Inc. (1993-1998); Associate, Ropes & Gray LLP. | 114 | None |
* | This is the date the Non-Independent Trustee began serving the Trust. Each Trustee serves an indefinite term, until his successor is elected. |
** | Fund Complex includes all open-end funds and closed-end funds (including all of their portfolios) advised by the Adviser and any funds that have an investment adviser that is an affiliated person of the Adviser. At April 30, 2014, the “Fund Family” consisted of the Trust’s 53 portfolios and three other exchange-traded fund trusts with 61 portfolios advised by the Adviser. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Andrew Schlossberg (1974) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046 | President | Since 2009 | Director, Invesco Distributors, Inc. (2012-Present); Managing Director—U.S. Strategy and Marketing, Invesco PowerShares Capital Management LLC (2010-Present); Managing Director, U.S. head of business strategy and chief marketing officer for Invesco Ltd. in the United States (2008-Present); Director, Invesco Distributors, Inc. (2012-Present); and Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present); formerly, Mr. Schlossberg served in multiple roles within Invesco, including head of corporate development, as well as global leadership roles in strategy and product development in the company’s North American Institutional and Retirement divisions (2002-2007). | |||
Peter Hubbard (1981) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2009 | Vice President and Director of Portfolio Management—Invesco PowerShares Capital Management LLC (2008-Present); formerly, Portfolio Manager, Invesco PowerShares Capital Management LLC (2007-2008); Research Analyst, Invesco PowerShares Capital Management LLC (2005-2007); Research Analyst and Trader, Ritchie Capital, a hedge fund operator (2003-2005). | |||
David Warren (1957) Invesco Canada Ltd. 5140 Yonge Street Suite 900, Toronto, Ontario M2N 6X7 | Vice President | Since 2009 | Managing Director—Chief Administrative Officer, Americas, Invesco PowerShares Capital Management LLC; Senior Vice President, Invesco Advisers, Inc. (2009-Present); Director, Executive Vice President and Chief Financial Officer, Invesco Inc. (2009-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) and Chief Administrative Officer, North American Retail, Invesco Ltd. (2007-Present); Senior Vice President, Invesco Management Group, Inc. (2007-Present); Director, Invesco Canada Holdings Inc. (2002-Present), Invesco Corporate Class Inc., and Invesco Canada Fund Inc.; Director, Executive Vice President and Chief Financial Officer, Invesco, Inc.; formerly, Director, Executive Vice President and Chief Financial Officer, Invesco Canada Ltd. (formerly, Invesco Trimark Ltd.) (2000-2006). | |||
Sheri Morris (1964) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Vice President | Since 2012 | Vice President, Treasurer and Principal Financial Officer, The Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2009-Present) and Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; formerly, Treasurer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust; Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc. | |||
Rudolf E. Reitmann (1971) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global Exchange Traded Funds Operations, Invesco PowerShares Capital Management LLC (since 2013). |
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Trustees and Officers (continued)
Name, Address and Age of Executive Officer | Position(s) Held with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | |||
Daniel E. Draper (1968) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President | Since 2013 | Senior Vice President, Invesco Distributors, Inc. (since 2014); Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Managing Director, Invesco PowerShares Global ETFs (since 2013); formerly, Managing Director, Credit Suisse Asset Management (2010-2013) and Lyxor Asset Management/Societe Generale (2007-2010). | |||
Steven M. Hill (1964) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Vice President and Treasurer | Since 2013 | Vice President and Treasurer of PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust (since 2013); Head of Global ETF Administration, Invesco PowerShares Capital Management LLC (since 2011); formerly, Senior Managing Director and Chief Financial Officer, Destra Capital Management LLC and its subsidiaries (2010-2011); Chief Financial Officer, Destra Investment Trust and Destra Investment Trust II (2010-2011); Senior Managing Director, Claymore Securities, Inc. (2003-2010); and Chief Financial Officer, Claymore sponsored mutual funds (2003-2010). | |||
Christopher Joe (1969) Invesco Management Group, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | Chief Compliance Officer | Since 2012 | U.S. Compliance Director, Invesco, Ltd. (since 2006); formerly, Chief Compliance Officer, Invesco Investment Advisers, LLC (registered investment adviser) (2010-2013); formerly, Assistant Fund Accounting Manager, Invesco, Ltd. (1998-1999). | |||
Anna Paglia (1974) Invesco PowerShares Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | Secretary | Since 2011 | Secretary, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, and PowerShares Actively Managed Exchange-Traded Fund Trust (2011-Present); Head of Legal, Invesco PowerShares Capital Management LLC (2010-Present); formerly, Partner, K&L Gates LLP (formerly, Bell Boyd & Lloyd LLP) (2007-2010); Associate Counsel at Barclays Global Investors Ltd. (2004-2006). |
Availability of Additional Information About the Trustees
The Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request at (800) 983-0903.
* | This is the date the officer began serving the Trust. Each officer serves an indefinite term, until his or her successor is elected. |
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for the following 51 series (each, a “Fund” and collectively, the “Funds”):
PowerShares Aerospace & Defense Portfolio
PowerShares BuyBack Achievers™ Portfolio
PowerShares Cleantech™ Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares DWA Momentum Portfolio
PowerShares DWA Basic Materials Momentum Portfolio
PowerShares DWA Consumer Cyclicals Momentum Portfolio
PowerShares DWA Consumer Staples Momentum Portfolio
PowerShares DWA Energy Momentum Portfolio
PowerShares DWA Financial Momentum Portfolio
PowerShares DWA Healthcare Momentum Portfolio
PowerShares DWA Industrials Momentum Portfolio
PowerShares DWA NASDAQ Momentum Portfolio
PowerShares DWA Technology Momentum Portfolio
PowerShares DWA Utilities Momentum Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Building & Construction Portfolio
PowerShares Dynamic Energy Exploration & Production Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Market Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Oil & Gas Services Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Financial Preferred Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares Fundamental Pure Large Core Portfolio
PowerShares Fundamental Pure Large Growth Portfolio
PowerShares Fundamental Pure Large Value Portfolio
PowerShares Fundamental Pure Mid Core Portfolio
PowerShares Fundamental Pure Mid Growth Portfolio
PowerShares Fundamental Pure Mid Value Portfolio
PowerShares Fundamental Pure Small Core Portfolio
PowerShares Fundamental Pure Small Growth Portfolio
PowerShares Fundamental Pure Small Value Portfolio
PowerShares Global Listed Private Equity Portfolio
PowerShares Golden Dragon China Portfolio
PowerShares High Yield Equity Dividend Achievers TM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares S&P 500® High Quality Portfolio
PowerShares Water Resources Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares WilderHill Progressive Energy Portfolio
PowerShares Zacks Micro Cap Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year, ten-year and since-inception periods ended December 31, 2013, as applicable, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
explanations for any tracking error. The Trustees noted that for each applicable period the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s advisory fee and net expense ratio, as compared to information compiled by the Adviser from Lipper Inc. databases on the advisory fees and net expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual advisory fee charged to each Fund is:
— | 0.50% of the Fund’s average daily net assets for each Fund other than PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend AchieversTM Portfolio, PowerShares International Dividend AchieversTM Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio; |
— | 0.40% of the Fund’s average daily net assets for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; and |
— | 0.29% of the Fund’s average daily net assets for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares S&P 500® High Quality Portfolio. |
The Trustees also noted that the Adviser has agreed to waive a portion of its advisory fee and/or pay expenses (an “Expense Cap”) to the extent necessary to prevent the annual operating expenses of each Fund from exceeding the percentage of that Fund’s average daily net assets, at least until August 31, 2015, as set forth below:
— | 0.60%, excluding interest expenses, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares DWA NASDAQ Momentum Portfolio and PowerShares Dynamic Market Portfolio; |
— | 0.50%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares Dividend Achievers™ Portfolio, PowerShares High Yield Equity Dividend Achievers™ Portfolio and PowerShares International Dividend Achievers™ Portfolio; |
— | 0.39%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Large Value Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio and PowerShares Fundamental Pure Small Value Portfolio; |
— | 0.29%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares S&P 500® High Quality Portfolio; |
— | 0.60%, excluding interest expenses, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio and PowerShares DWA Utilities Momentum Portfolio (the Trustees noted that prior to December 17, 2013, licensing fees were excluded from the Expense Cap); and |
— | 0.60%, excluding interest expenses, licensing fees, offering costs, brokerage commissions and other trading expenses, taxes, acquired fund fees and expenses and extraordinary expenses, for each other Fund. |
The Trustees noted that the Adviser represented that it does not serve as the investment adviser to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds, but that the Adviser provides sub-advisory services to clients with comparable investment strategies as certain of the Funds. The Trustees further noted the Adviser’s explanation with respect to the sub-advisory fees it receives for such services in comparison to the advisory fees charged to the Funds. The Trustees noted that each Fund’s advisory fee was:
— | higher than the median advisory fee of its ETF peer funds (except for the advisory fee of each of PowerShares Financial Preferred Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio and PowerShares International Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its ETF peer funds); and |
— | higher than the median advisory fee of its open-end index peer funds (except for the advisory fee of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio and PowerShares High Yield Equity Dividend Achievers™ Portfolio, which was equal to or lower than the median advisory fee of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median advisory fee of its open-end actively-managed peer funds. |
The Trustees determined that the advisory fees were reasonable, noting the complexity of the indexes, the distinguishing factors of the Funds, and the administrative, operational and management oversight costs for the Adviser. With respect to the Funds’ net expense ratios, the Trustees noted that the net expense ratio for each Fund was:
— | higher than the median net expense ratio of its ETF peer funds (except for the net expense ratio of each of PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers Portfolio and PowerShares S&P 500® High Quality Portfolio, which was equal to or less than the median net expense ratio of its ETF peer funds); and |
— | higher than the median net expense ratio of its open-end index peer funds (except for the net expense ratio of each of PowerShares Dividend Achievers™ Portfolio, PowerShares DWA Momentum Portfolio, PowerShares DWA NASDAQ Momentum Portfolio, PowerShares DWA Technology Momentum Portfolio, PowerShares DWA Utilities Momentum Portfolio, PowerShares Dynamic Large Cap Growth Portfolio, PowerShares Dynamic Networking Portfolio, PowerShares Dynamic Semiconductors Portfolio, PowerShares Dynamic Software Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Fundamental Pure Large Core Portfolio, PowerShares Fundamental Pure Large Growth Portfolio, PowerShares Fundamental Pure Mid Core Portfolio, PowerShares Fundamental Pure Mid Growth Portfolio, PowerShares Fundamental Pure Mid Value Portfolio, PowerShares Fundamental Pure Small Core Portfolio, PowerShares Fundamental Pure Small Growth Portfolio, PowerShares Fundamental Pure Small Value Portfolio, PowerShares High Yield Equity |
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Dividend Achievers™ Portfolio and PowerShares S&P 500® High Quality Portfolio, which was lower than the median net expense ratio of its open-end index peer funds; and there was no comparable data for PowerShares Aerospace & Defense Portfolio, PowerShares Cleantech™ Portfolio, PowerShares DWA Basic Materials Momentum Portfolio, PowerShares DWA Consumer Cyclicals Momentum Portfolio, PowerShares DWA Consumer Staples Momentum Portfolio, PowerShares DWA Energy Momentum Portfolio, PowerShares DWA Financial Momentum Portfolio, PowerShares DWA Healthcare Momentum Portfolio, PowerShares DWA Industrials Momentum Portfolio, PowerShares Dynamic Biotechnology & Genome Portfolio, PowerShares Dynamic Building & Construction Portfolio, PowerShares Dynamic Energy Exploration & Production Portfolio, PowerShares Dynamic Food & Beverage Portfolio, PowerShares Dynamic Leisure and Entertainment Portfolio, PowerShares Dynamic Media Portfolio, PowerShares Dynamic Oil & Gas Services Portfolio, PowerShares Dynamic Pharmaceuticals Portfolio, PowerShares Dynamic Retail Portfolio, PowerShares Financial Preferred Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Golden Dragon China Portfolio, PowerShares International Dividend Achievers™ Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy Portfolio or PowerShares WilderHill Progressive Energy Portfolio); but |
— | lower than the median net expense ratio of its open-end actively-managed peer funds. |
The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds, and noted those Funds for which license fees are included in the Funds’ Expense Caps.
The Board concluded that the advisory fee and expense ratio of each Fund (giving effect to the Fund’s Expense Cap) were reasonable and appropriate in light of the services provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to any of the Funds was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size, expense ratio and expense limitation agreed to by the Adviser. The Trustees noted that, for Funds whose expenses are higher than their respective Expense Caps, any reduction in that Fund’s expenses would be enjoyed by the Adviser, but that Fund shareholders benefit from the lower expense ratio as a result of the Fund’s Expense Cap. The Trustees also noted that the Excess Expense Agreement with the Trust provides that the Adviser is entitled to be reimbursed by each Fund, other than PowerShares Dynamic Market Portfolio and PowerShares DWA NASDAQ Momentum Portfolio, for fees waived or expenses absorbed pursuant to the Expense Cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its Expense Cap. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate, noting the Fund expenses the Adviser has borne as a result of the Expense Cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
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Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 17, 2014, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the “Trust”), including the Independent Trustees, approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the “Adviser”) and the Trust for PowerShares NASDAQ Internet Portfolio and PowerShares S&P 500 BuyWrite Portfolio (each, a “Fund” and together, the “Funds”).
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as a Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered to and amounts paid by other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund. No single factor was determinative in the Board’s analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser’s services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser’s current organization and staffing, including operational support provided by the Adviser’s parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser’s oversight of the execution of portfolio transactions on behalf of the Funds. The Trustees also reviewed information on the performance of the Funds, their underlying indexes and their primary benchmarks for the one-year, three-year, five-year and since-inception (June 12, 2008 for PowerShares NASDAQ Internet Portfolio and December 20, 2007 for PowerShares S&P 500 BuyWrite Portfolio) periods ended December 31, 2013, including reports for each of those periods on the correlation and tracking error between each Fund’s performance and the performance of its underlying index, as well as the Adviser’s analysis of the tracking error between each Fund and its underlying index. In reviewing the tracking error report, the Trustees considered information provided by Ibbotson Associates, a consultant to the Independent Trustees, with respect to general expected tracking error ranges and various explanations for any tracking error. The Trustees noted that for each period, the correlation and tracking error for each Fund was within the targeted range set forth in the Trust’s registration statement. The Trustees concluded that each Fund was correlated to its underlying index and that the tracking error for each Fund was within an acceptable range given that Fund’s particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds’ administrator, custodian and transfer agent. They noted the significant amount of time, effort and resources that had been devoted to this oversight function.
Based on their review, the Trustees concluded that the nature, extent and quality of services provided by the Adviser to the Funds under the Investment Advisory Agreement were appropriate and reasonable.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund’s net expense ratio and unitary advisory fee, as compared to information compiled by the Adviser from Lipper Inc. databases on the expense ratios of comparable exchange-traded funds (“ETFs”), open-end (non-ETF) index funds and open-end actively-managed funds. The Trustees noted that the annual unitary advisory fee is 0.60% for PowerShares NASDAQ Internet Portfolio and 0.75% for PowerShares S&P 500 BuyWrite Portfolio, and that the Adviser pays all other operating expenses of each Fund, except that each Fund pays its brokerage expenses, taxes, interest, litigation expenses and other extraordinary expenses.
The Trustees noted that the Adviser represented that it does not provide investment advisory services to any clients, other than other ETFs also overseen by the Trustees, with comparable investment strategies as the Funds. The Trustees noted that PowerShares NASDAQ Internet Portfolio’s advisory fee was higher than the median net expense ratio of its ETF peer funds, but was lower than the median net expense ratios of its open-end index peer funds and open-end actively-managed peer funds. The Trustees noted that PowerShares S&P 500 BuyWrite Portfolio’s advisory fee was lower than the median net expense ratios of its ETF peer funds, open-end index peer funds and open-end actively-managed peer funds. The Trustees noted that each Fund’s advisory fee was reasonable because of the complexity of the indexes, the distinguishing factors of the Funds and the administrative, operational and management oversight costs for the Adviser. The Trustees also noted that a portion of each Fund’s advisory fee was attributable to a license fee payable out of the unitary fee charged to that Fund. The Board concluded that the unitary advisory fee charged to each Fund was reasonable and appropriate in light of the services provided.
In conjunction with their review of the unitary advisory fee, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement. The Trustees reviewed information provided by the
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Board Considerations Regarding Continuation of Investment Advisory Agreement (continued)
Adviser on its profitability, as well as any profits or losses realized by the Adviser from its relationship to each Fund. The Trustees concluded that the estimated profitability to the Adviser of the advisory services provided to each Fund was not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund’s asset size and expense ratio. The Trustees noted that any reduction in fixed costs associated with the management of the Funds would be enjoyed by the Adviser, but a unitary fee provides a level of certainty in expenses for the Funds. The Trustees considered whether the advisory fee rate for each Fund was reasonable in relation to the asset size of that Fund, and concluded that the flat advisory fee was reasonable and appropriate.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationships with the Funds and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund.
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Proxy Voting Policies and Procedures
A description of the Trust’s proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 983-0903. This information is also available on the Securities and Exchange Commission’s (“Commission”) website at www.sec.gov.
Information regarding how each Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 983-0903; or (ii) accessing the Trust’s Form N-PX on the Commission’s website at www.sec.gov.
Quarterly Portfolios
The Trust files its complete schedule of portfolio holdings for the Funds with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Trust’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Trust’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
Frequency Distribution of Discounts and Premiums
A table showing the number of days the market price of each Fund’s shares was greater than the Fund’s net asset value, and the number of days it was less than the Fund’s net asset value (i.e., premium or discount) for the most recently completed calendar year, and the calendar quarters since that year end (or the life of the Fund, if shorter) may be found at the Fund’s website at www.invescopowershares.com.
©2014 Invesco PowerShares Capital Management LLC | P-PS-AR-3 | |||||
3500 Lacey Road, Suite 700 Downers Grove, IL 60515 | ||||||
invescopowershares.com 800.983.0903 | @PowerShares |
Item 2. Code of Ethics.
The Registrant has adopted a Code of Ethics that applies to the Registrant’s principal executive officer and principal financial officer. This Code is filed as an exhibit to this report on Form N-CSR under Item 12(a)(1). No substantive amendments to this Code were made during the reporting period. There were no waivers for the fiscal year ended April 30, 2014.
Item 3. Audit Committee Financial Expert.
The Registrant’s Board of Trustees (the “Board”) has determined that the Registrant has three “audit committee financial experts” serving on its audit committee: Mr. Marc M. Kole, Mr. Gary R. Wicker and Mr. Donald H. Wilson. Each of these audit committee members is “independent,” meaning that he is not an “interested person” of the Registrant (as that term is defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended) and he does not accept any consulting, advisory, or other compensatory fee from the Registrant (except in his capacity as a Board or committee member).
An “audit committee financial expert” is not an “expert” for any purpose, including for purposes of Section 11 of the Securities Act of 1933, as a result of being designated as an “audit committee financial expert.” Further, the designation of a person as an “audit committee financial expert” does not mean that person has any greater duties, obligations, or liability than those imposed on a person without the “audit committee financial expert” designation. Similarly, the designation of a person as an “audit committee financial expert” does not affect the duties, obligations, or liability of any other member of the audit committee or Board of trustees.
Item 4. Principal Accountant Fees and Services.
(a) to (d)
PricewaterhouseCoopers LLP (“PwC”) billed the Registrant aggregate fees for services rendered to the Registrant for the last two fiscal years as follows:
Fees Billed by PwC for Services Rendered to the Registrant for fiscal year end 2014 | (e)(2) Percentage of Services Approved for fiscal year end 2014 Pursuant to Waiver of Pre- Approval Requirement(1) | Fees Billed by PwC for Services Rendered to the Registrant for fiscal year end 2013 | (e)(2) Percentage of Services Approved for fiscal year end 2013 Pursuant to Waiver of Pre- Approval Requirement(1) | |||||||||
Audit Fees | $ | 671,700 | N/A | $ | 789,800 | N/A | ||||||
Audit-Related Fees | $ | 0 | 0% | $ | 0 | 0% | ||||||
Tax Fees(2) | $ | 408,510 | 0% | $ | 419,580 | 0% | ||||||
All Other Fees | $ | 0 | 0% | $ | 0 | 0% | ||||||
Total Fees | $ | 1,080,210 | 0% | $ | 1,209,380 | 0% |
(1) For the provision of non-audit services, the pre-approval requirement is waived pursuant to a de minimis exception if (i) such services were not recognized as non-audit services by the Registrant at the time of engagement, (ii) the aggregate amount of all such services provided is no more than 5% of the aggregate audit and non-audit fees paid by the Registrant during the fiscal year in which the services are provided; and (iii) such services are promptly
brought to the attention of the Registrant’s Audit Committee and approved by the Registrant’s Audit Committee prior to the completion of the audit.
(2) Tax fees for the fiscal year ended April 30, 2014 include fees billed for reviewing tax returns, 2013 excise tax returns and excise tax distributions calculations in addition to preparing the final tax returns for the two liquidated portfolios of the Trust. Tax fees for the fiscal year ended April 30, 2013 included fees billed for reviewing tax returns, 2012 excise tax returns and excise tax distribution calculations. .
(e) (1) Audit Committee Pre Approval Policies and Procedures
PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES
POLICIES AND PROCEDURES
As Adopted by the Audit Committee of the PowerShares Funds (the “Funds”)
June 26, 2009
Statement of Principles
Under the Sarbanes-Oxley Act of 2002 and rules adopted by the Securities and Exchange Commission (“SEC”) (“Rules”), the Audit Committee of the Funds’ (the “Audit Committee”) Board of Trustees (the “Board”) is responsible for the appointment, compensation and oversight of the work of independent accountants (an “Auditor”). As part of this responsibility and to assure that the Auditor’s independence is not impaired, the Audit Committee pre-approves the audit and non-audit services provided to the Funds by each Auditor, as well as all non-audit services provided by the Auditor to the Funds’ investment adviser and to affiliates of the adviser that provide ongoing services to the Funds (“Service Affiliates”) if the services directly impact the Funds’ operations or financial reporting. The SEC Rules also specify the types of services that an Auditor may not provide to its audit client. The following policies and procedures comply with the requirements for pre-approval and provide a mechanism by which management of the Funds may request and secure pre-approval of audit and non-audit services in an orderly manner with minimal disruption to normal business operations.
Proposed services either may be pre-approved without consideration of specific case-by-case services by the Audit Committee (“general pre-approval”) or require the specific pre-approval of the Audit Committee (“specific pre-approval”). As set forth in these policies and procedures, unless a type of service has received general pre-approval, it will require specific pre-approval by the Audit Committee. Additionally, any fees exceeding 110% of estimated pre-approved fee levels provided at the time the service was pre-approved will also require specific approval by the Audit Committee before payment is made. The Audit Committee will also consider the impact of additional fees on the Auditor’s independence when determining whether to approve any additional fees for previously pre-approved services.
The Audit Committee will annually review and generally pre-approve the services that may be provided by each Auditor without obtaining specific pre-approval from the Audit Committee. The term of any general pre-approval runs from the date of such pre-approval through June 30th of the following year, unless the Audit Committee considers a different period and states otherwise. The Audit Committee will add to or subtract from the list of general pre-approved services from time to time, based on subsequent determinations.
The purpose of these policies and procedures is to set forth the guidelines to assist the Audit Committee in fulfilling its responsibilities.
Delegation
The Chairman of the Audit Committee (or, in his or her absence, any member of the Audit Committee) may grant specific pre-approval for non-prohibited services for engagements of less than $20,000. All such delegated pre-approvals shall be presented to the Audit Committee no later than the next Audit Committee meeting.
Audit Services
The annual Audit services engagement terms will be subject to specific pre-approval of the Audit Committee. Audit services include the annual financial statement audit and other procedures such as tax provision work that is required to be performed by the independent auditor to be able to form an opinion on the Funds’ financial statements. The Audit Committee will obtain, review and consider sufficient information concerning the proposed Auditor to make a reasonable evaluation of the Auditor’s qualifications and independence.
In addition to the annual Audit services engagement, the Audit Committee may grant either general or specific pre-approval of other Audit services, which are those services that only the independent auditor reasonably can provide. Other Audit services may include services such as issuing consents for the inclusion of audited financial statements with SEC registration statements, periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings.
Non-Audit Services
The Audit Committee may provide either general or specific pre-approval of any non-audit services to the Funds and its Service Affiliates if the Audit Committee believes that the provision of the service will not impair the independence of the Auditor, is consistent with the SEC’s Rules on auditor independence, and otherwise conforms to the Audit Committee’s general principles and policies as set forth herein.
Audit-Related Services
“Audit-related services” are assurance and related services that are reasonably related to the performance of the audit or review of the Funds’ financial statements or that are traditionally performed by the independent auditor. Audit-related services include, among others, accounting consultations related to accounting, financial reporting or disclosure matters not classified as “Audit services”; and assistance with understanding and implementing new accounting and financial reporting guidance from rulemaking authorities.
Tax Services
“Tax services” include, but are not limited to, the review and signing of the Funds’ federal tax returns, the review of required distributions by the Funds and consultations regarding tax matters such as the tax treatment of new investments or the impact of new regulations. The Audit Committee will scrutinize carefully the retention of the Auditor in connection with a transaction initially recommended by the Auditor, the major business purpose of which may be tax avoidance or the tax treatment of which may not be supported in the Internal Revenue Code and related regulations. The Audit Committee will consult with the Funds’ Treasurer (or his or her designee) and may consult with outside counsel or advisors as necessary to ensure the consistency of Tax services rendered by the Auditor with the foregoing policy.
No Auditor shall represent any Fund or any Service Affiliate before a tax court, district court or federal court of claims.
Under rules adopted by the Public Company Accounting Oversight Board and approved by the SEC, in connection with seeking Audit Committee pre-approval of permissible Tax services, the Auditor shall:
1. | Describe in writing to the Audit Committee, which writing may be in the form of the proposed engagement letter: |
a. | The scope of the service, the fee structure for the engagement, and any side letter or amendment to the engagement letter, or any other agreement between the Auditor and the Fund, relating to the service; and |
b. | Any compensation arrangement or other agreement, such as a referral agreement, a referral fee or fee-sharing arrangement, between the Auditor and any person (other than the Fund) with respect to the promoting, marketing, or recommending of a transaction covered by the service; |
2. | Discuss with the Audit Committee the potential effects of the services on the independence of the Auditor; and |
3. | Document the substance of its discussion with the Audit Committee. |
All Other Auditor Services
The Audit Committee may pre-approve non-audit services classified as “All other services” that are not categorically prohibited by the SEC, as listed in Exhibit 1 to this policy.
Pre-Approval Fee Levels or Established Amounts
Pre-approval of estimated fees or established amounts for services to be provided by the Auditor under general or specific pre-approval policies will be set periodically by the Audit Committee. Any proposed fees exceeding 110% of the maximum estimated pre-approved fees or established amounts for pre-approved audit and non-audit services will be reported to the Audit Committee at the quarterly Audit Committee meeting and will require specific approval by the Audit Committee before payment is made. The Audit Committee will always factor in the overall relationship of fees for audit and non-audit services in determining whether to pre-approve any such services and in determining whether to approve any additional fees exceeding 110% of the maximum pre-approved fees or established amounts for previously pre-approved services.
Procedures
On an annual basis, the Auditor will submit to the Audit Committee for general pre-approval, a list of non-audit services that the Funds or Service Affiliates of the Funds may request from the Auditor. The list will describe the non-audit services in reasonable detail and will include an estimated range of fees and such other information as the Audit Committee may request.
Each request for services to be provided by the Auditor under the general pre-approval of the Audit Committee will be submitted to the Funds’ Treasurer (or his or her designee) and must include a detailed description of the services to be rendered. The Treasurer or his or her designee will ensure that such services are included within the list of services that have received the general pre-approval of the Audit Committee. The Audit Committee will be informed at the next quarterly scheduled Audit Committee meeting of any such services for which the Auditor rendered an invoice and whether such services and fees had been pre-approved and if so, by what means.
Each request to provide services that require specific approval by the Audit Committee shall be submitted to the Audit Committee jointly by the Funds’ Treasurer or his or her designee and the Auditor, and must include a joint statement that, in their view, such request is consistent with the pre-approval policies and procedures and the SEC Rules.
Each request to provide Tax services under either the general or specific pre-approval of the Audit Committee will describe in writing: (i) the scope of the service, the fee structure for the engagement, and any side letter or amendment to the engagement letter, or any other agreement between the Auditor and the audit client, relating to the service; and (ii) any compensation arrangement or other agreement between the Auditor and any person (other than the audit client) with respect to the promoting, marketing, or recommending of a transaction covered by the service. The Auditor will discuss with the Audit Committee the potential effects of the services on the Auditor’s independence and will document the substance of the discussion.
Non-audit services pursuant to the de minimis exception provided by the SEC Rules will be promptly brought to the attention of the Audit Committee for approval, including documentation that each of the conditions for this exception, as set forth in the SEC Rules, has been satisfied.
On at least an annual basis, the Auditor will prepare a summary of all the services provided to any entity in the investment company complex as defined in section 2-01(f)(14) of Regulation S-X in sufficient detail as to the nature of the engagement and the fees associated with those services.
The Audit Committee has designated the Funds’ Treasurer to monitor the performance of all services provided by the Auditor and to ensure such services are in compliance with these policies and procedures. The Funds’ Treasurer will report to the Audit Committee on a periodic basis as to the results of such monitoring. Both the Funds’ Treasurer and
management will immediately report to the Chairman of the Audit Committee any breach of these policies and procedures that comes to the attention of the Funds’ Treasurer or senior management.
Exhibit 1 to Pre-Approval of Audit and Non-Audit Services Policies and Procedures
Conditionally Prohibited Non-Audit Services (not prohibited if the Fund can reasonably conclude that the results of the service would not be subject to audit procedures in connection with the audit of the Fund’s financial statements)
• | Bookkeeping or other services related to the accounting records or financial statements of the audit client |
• | Financial information systems design and implementation |
• | Appraisal or valuation services, fairness opinions, or contribution-in-kind reports |
• | Actuarial services |
• | Internal audit outsourcing services |
Categorically Prohibited Non-Audit Services
• | Management functions |
• | Human resources |
• | Broker-dealer, investment adviser, or investment banking services |
• | Legal services |
• | Expert services unrelated to the audit |
• | Any service or product provided for a contingent fee or a commission |
• | Services related to marketing, planning, or opining in favor of the tax treatment of confidential transactions or aggressive tax position transactions, a significant purpose of which is tax avoidance |
• | Tax services for persons in financial reporting oversight roles at the Fund |
• | Any other service that the Public Company Oversight Board determines by regulation is impermissible. |
(f) | Not applicable. |
(g) | PwC billed the Registrant aggregate fees of $408,510 for the fiscal year ended April 30, 2014 and $419,580 for the fiscal year ended April 30, 2013 for non-audit services rendered to the Registrant. |
PwC did not bill any fees for non-audit services rendered to the Registrant’s investment adviser (not including any Sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) or any entity controlling, controlled by or under common control with the Registrant’s investment adviser that provides ongoing services to the Registrant for the fiscal years ended April 30, 2014 and April 30, 2013. |
(h) | Not applicable. |
Item 5. Audit Committee of Listed Registrants.
(a) | The Registrant has a separately designated Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended, which consists solely of independent trustees. The Audit Committee members are, Marc M. Kole, Gary R. Wicker and Donald H. Wilson. |
(b) | Not applicable |
Item 6. Schedule of Investments.
(a) | The Schedules of Investments are included as a part of the report to shareholders filed under Item 1 of this Form N-CSR. |
(b) | Not applicable |
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees that would require disclosure herein.
Item 11. Controls and Procedures.
a) | Based on their evaluation of the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) as of a date within 90 days of the filing date of this report, the Registrant’s President (principal executive officer) and Treasurer (principal financial officer) have concluded that such disclosure controls and procedures are effective. |
b) | There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
Item 12. Exhibits.
(a)(1) Code of Ethics is attached as Exhibit 99.CODEETH.
(a)(2) Certifications of the Registrant’s President and Treasurer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are attached as Exhibit 99.CERT.
(a)(3) Not applicable.
(b) Certifications of the Registrant’s President and Treasurer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are attached as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) | PowerShares Exchange-Traded Fund Trust |
By: | /s/ Andrew Schlossberg | |
Name: | Andrew Schlossberg | |
Title: | President | |
Date: | July 7, 2014 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By: | /s/ Andrew Schlossberg | |
Name: | Andrew Schlossberg | |
Title: | President | |
Date: | July 7, 2014 |
By: | /s/ Steven Hill | |
Name: | Steven Hill | |
Title: | Treasurer | |
Date: | July 7, 2014 |