Invesco has cut fees on a trio of fixed income ETFs totaling $1.7 billion in assets.
The affected funds include the $985 million Invesco Total Return Bond ETF (GTO), the $654 million Invesco 1-30 Laddered Treasury ETF (PLW), and the $33 million Invesco AAA CLO Floating Rate Note ETF (ICLO). GTO and ICLO are actively managed fixed income ETFs, an area seeing increased attention this year.
“Advisors are increasingly embracing actively managed fixed income ETFs. They have more tools than ever before to build portfolios that take advantage of professional management,” Todd Rosenbluth, head of research at VettaFi, said. “By bringing the fees down, Invesco has made themselves a strong alternative.”
Invesco AAA CLO Floating Rate Note ETF (ICLO)
The biggest change will come to investors in ICLO. Effective June 28, Invesco is notably waiving the entire 26 basis point management fee through the end of the year for ICLO.
ICLO actively invests in floating rate notes issued by CLOs rated AAA or of equivalent quality.
ICLO launched in December 2022, alongside three other active fixed income ETFs: the Invesco High Yield Select ETF (HIYS), the Invesco Municipal Strategic Income ETF (IMSI), and the Invesco Short Duration Bond ETF (ISDB)
Invesco Total Return Bond ETF (GTO)
Invesco is waiving a portion of GTO’s management fee through August 31, 2025. The fund will charge 25 basis points, previously 50 basis points, effective on June 28.
GTO is an actively managed intermediate-term bond ETF. The fund is an ideal fit for investors looking for an active total return portfolio. GTO allows investors to farm out decisions to Invesco’s fixed income portfolio managers on when to add risk (or not), as well as how to play with duration.
Invesco 1-30 Laddered Treasury ETF (PLW)
Effective at market open on June 26, PLW’s management fee was permanently reduced to 15 basis points. Previously, PLW charged 25 basis points.
PLW is based on the Ryan/NASDAQ U.S. 1-30 Year Treasury Laddered Index. PLW’s underlying index measures the potential returns of the U.S. Treasury yield curve based on approximately 30 equally weighted U.S. Treasury issues with fixed coupons, scheduled to mature in a proportional, laddered structure.
PLW will see further changes at market close on August 25, when the fund’s name, ticker, index, and strategy will change.
The fund’s name and ticker will change from the Invesco 1-30 Laddered Treasury ETF (PLW) to the Invesco Equal Weight 0-30 Year Treasury ETF (GOVI). Additionally, the fund’s underlying index will change to the ICE 1-30 Year Laddered Maturity US Treasury Index.
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