A sound investment process and strong management team underpin Invesco Russell 2000® Dynamic Mltfct ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a sizable cost advantage over competitors, priced within the cheapest fee quintile among peers.  

 The strategy's effective investment philosophy supports an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an overweight in volatility exposure and an underweight in liquidity exposure compared with category peers. High volatility exposure is attributed to companies with a higher standard deviation of returns. And a low liquidity exposure is rooted in stocks with lower trading volumes, limiting managers' flexibility. The strategy’s management team earns an Above Average People Pillar rating. The strategy's parent organization earns the firm an Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

Telephone and Data Systems

Caleres

Hibbett Sports

Amneal Pharmaceuticals

SunCoke Energy

Interface

Koppers

ScanSource

Steelcase

Olympic Steel

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. Invesco Russell 2000® Dynamic Mltfct ETF earns an Above Average Process Pillar rating. 

The main contributor to the rating is that this fund tracks an index. Historical data, such as Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. Excellent risk-adjusted performance also influences the rating. This can be seen in the fund's five-year alpha calculated relative to the category average, which suggests that the managers have shown skill in their allocation of risk. Lastly, the process is limited by the parent firm's five-year risk-adjusted success ratio of 42%. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's modest success ratio suggests that the firm could do better across its fund lineup.

 This strategy leans toward smaller, deeper value companies than its average peer in the Small Blend Morningstar Category. Examining additional factor exposure, this strategy has exhibited a tilt toward high-volatility stocks or the shares of companies with histories of the higher standard deviation of returns, compared with Morningstar Category peers in the last few years. Such stocks tend to rise faster and fall harder than the broad market. High-volatility exposure contributes to stronger performance during bull markets, but often at the cost of losing more during downturns. In recent months, the strategy was more exposed to the Volatility factor compared with its Morningstar Category peers as well. This strategy has also exhibited an overweight liquidity risk tilt, evidenced by holding companies with relatively lower trading volumes than peers in these years. Less-liquid stocks might offer strong returns to compensate for their risks, but they can be harder and more expensive to trade in bear markets. Similarly, in recent months, the strategy also had less exposure to the Liquidity factor than peers. This strategy also has tilted toward low-quality stocks, companies with higher financial leverage and lower profitability over these years. Lacking this ballast, the fund's prospects could rest on its ability to beat peers during economic booms. In recent months, the strategy also had less Quality factor exposure than its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section. 

 The portfolio is overweight in financial services and communication services relative to the category average by 7.6 and 3.2 percentage points, respectively. The sectors with low exposure compared to category peers are technology and healthcare, underweight the average by 8.8 and 5.0 percentage points of assets, respectively. The portfolio is positioned across 704 holdings and is less top-heavy than peers. Specifically, 6.1% of the portfolio's assets are concentrated within the top 10 fund holdings, as opposed to the category average's 23.9%. And finally, in terms of portfolio turnover, on a year-over-year basis, 336% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.

Above Average

Process

Invesco’s team is strong compared with others in the industry, resulting in an Above Average People Pillar rating. There are four managers listed on the fund: Michael Jeanette, Peter Hubbard, Tony Seisser, Pratik Doshi. Experience on the team is abundant, with 12 years of average portfolio management experience. Together, they manage a total of 144 strategies, with solid long-term prospects. The strategies average a Bronze asset-weighted Morningstar Medalist Rating, indicating a position to deliver positive alpha relative to the category median in aggregate.  

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

People

Invesco succeeds in a number of areas but also has its share of subpar offerings, along with many others that land somewhere in the middle. A mid-2023 change of CEO, from longtime chief Marty Flanagan to veteran Invesco executive Andrew Schlossberg, is noteworthy, and several other executives retired or departed in 2023. Portfolio-manager shuffles aimed at bolstering poor performers, which began under Flanagan, have continued under Schlossberg, who told Morningstar his most important aim is bolstering “investment quality.” However, major changes of direction or approach are unlikely. The firm retains a Morningstar Parent rating of Average. 
Invesco’s international-equity teams in Texas and New York remain solid. However, the extensive U.S.-equity lineup needs improvement. Fixed-income offerings run the gamut: The multisector and short-term-bond areas are good, but corporate high-yield is less impressive. The firm’s exchange-traded fund lineup includes the popular Nasdaq-focused QQQ; passive strategies make up around 37% of Invesco’s assets under management. Invesco has not been averse to trying new types of strategies, and it was among the firms that immediately launched a spot bitcoin ETF after SEC approval in early 2024.
The picture outside the United States is mixed. Fund performance has been subpar in Asia, and while the picture has brightened in the United Kingdom and Europe, that region still can’t be considered a strength.

Average

Parent

Invesco Russell 1000 Dynamic Multifactor ETF

OMFS tracks an index of US small-cap stocks selected by five investment factors, which are weighted based on current macroeconomic conditions.

If you're interested in broad exposure to the Small Cap Blend segment of the US equity market, look no further than the Invesco Russell 2000 Dynamic Multifactor ETF (OMFS), a passively managed exchange traded fund launched on 11/08/2017.

Should Invesco Russell 2000 Dynamic Multifactor ETF (OMFS) Be on Your Investing Radar?

The Invesco Russell 2000 Dynamic Multifactor ETF (OMFS) made its debut on 11/08/2017, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Small Cap Blend category of the market.

Is Invesco Russell 2000 Dynamic Multifactor ETF (OMFS) a Strong ETF Right Now?

Invesco International Developed Dynamic Multifactor ETF

Invesco's large-cap dynamic multifactor ETF has garnered significant investor attention in 2023. The Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) has seen consistently strong inflows year to date, reaching $2.6 billion in net flows in 2023 as of December 11.

Invesco's Dynamic Multifactor ETF Sees Strong Flows in 2023

The Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) has seen a dramatic surge in investor interest in recent weeks. Investors have recently looked for an alternative to market cap weight strategies believing that market breadth will expand beyond a handful of mega-cap growth stocks, according to Todd Rosenbluth, head of research at VettaFi.

Invesco Multi-Factor ETF OMFL Sees Spike in Flows

As measured by the Morningstar U.S. Large, Mid and Small Cap indexes, small-cap equities were the worst performers this year. With cyclical value stocks rallying earlier in the year, small-cap stocks started 2021 on strong footing, but as volatility rose in the second half of 2021, investors sought the comforting embrace of large- and mega-cap [.

Positioning for a 2022 Small-Cap Rebound

With small-caps emerging as a favored idea for 2022 upside, many are likely to eschew stock picking and embrace the utility of broad-based exchange traded funds. However, more selective market participants might demand more than the most basic approaches in this category.

Embrace Multiple Factors for Small-Cap Gains

John Hancock Multifactor Energy ETF

Principal U.S. Small-Cap Multi-Factor Index ETF

Whether it's momentum, volatility, size, quality, or value, there is no one-size-fits-all solution when it comes to factor investing. This is where multi-factor funds can assist, and one place to start is the strongest 2021 performers.

Majestic Multi-Factor ETFs: Here Are 3 to Consider

ProShares UltraPro Russell2000

Eastman Kodak is one of the latest companies to join the battle against the coronavirus. While other companies like GE, Tesla, and Ford have all committed their support to provide resources in the US, Kodak shares exploded higher on Wednesday after President Trump announced a deal to work with the photography pioneer to generate ingredients in [.

Russell ETFs Rally As Eastman Kodak Surges

When it comes to getting strategic in today’s uncertainty, investors prefer to seek safe haven shelter in bonds, but even that move can be a risky proposition given that certain debt, like corporate bonds, could be facing default amid the coronavirus outbreak.

News for Invesco Russell 1000 Dynamic Multifactor ETF ETF (OMFS)