Invesco Optm Yd Dvrs Cdty Stra No K1 ETF's Average People Pillar and Process Pillar ratings result in a Morningstar Medalist Rating of Neutral. The portfolio maintains a sizable cost advantage over competitors, priced within the cheapest fee quintile among peers.  

 The strategy’s management team earns an Average People Pillar rating. The fund's assessment results in an Average Process 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

Morningstar's evaluation of this fund's process aims to determine how repeatable, consistent, and reliable it is, and whether management maintains a competitive advantage. Invesco Optm Yd Dvrs Cdty Stra No K1 ETF earns an Average Process Pillar rating. The leading factor in the rating is the fund's excellent long-term risk-adjusted performance. This can be seen in its five-year alpha calculated relative to the category index, which suggests that the process was successful over that period. The stability of the management team also bolsters the process. Specifically, the fund has not seen a manager change in the last eight years. 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 outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's subpar success ratio suggests that the firm could do better across its fund lineup.

The investment strategy as stated in the fund's prospectus is as follows: 

 The investment seeks long term capital appreciation.  The fund is an actively managed exchange-traded fund ("ETF") that seeks to achieve its investment objective by investing in a combination of financial instruments that are economically linked to the world's most heavily traded commodities. Commodities are assets that have tangible properties, such as oil, agricultural produce or raw metals.

Average

Process

Invesco Optm Yd Dvrs Cdty Stra No K1 ETF earns an Average People Pillar rating. The team is backed by Peter Hubbard, the longest-tenured manager on the strategy, who provides 17 years of listed portfolio management experience. The average Morningstar Rating of the strategies they currently manage is 3.1 stars, indicating that their risk-adjusted returns have been in line with the category average. Peter Hubbard draws on a supporting cast of three additional listed managers. Together they average nine years of listed portfolio management experience. As a team, they manage six investment vehicles together, with an asset-weighted average Morningstar Medalist Rating of Neutral. This means, in aggregate, the team falls short and will struggle to produce positive alpha. The team has successfully retained portfolio-manager talent, providing continuity for strategies as long-term stability tends to support positive results. There have been no documented departures within the past five years. None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would align their interests with the strategy's investors.

 Note: The People Pillar rating is indirectly assigned by an analyst. The longest-tenured manager of the fund also manages a different product rated by an analyst. Their analyst-assigned People Pillar rating is combined here with the People scores (algorithmic or analyst-assigned) for the fund’s other managers on a tenure-weighted basis.

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.

Parent

Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF

PDBC holds a diverse basket of commodity futures and aims to mitigate negative roll yield in its contract selection. The fund is structured as an ETF and is actively managed.

Cocoa prices have surged, surpassing the price of copper, while the broader commodity complex has been in rally mode. Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF has diversified commodity exposure and may benefit from an improved macro backdrop. PDBC has high exposure to energy commodities and low allocation in soft commodities like agriculture.

Commodities Are On A Roll, Playing The Upside Through PDBC

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The Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF is an actively managed ETF that invests in commodity-linked futures. PDBC offers a diversified approach to its portfolio, reducing overall volatility and standard deviation. The outlook for oil and gold in 2024 is strong, which should translate into a strong performance for PDBC.

PDBC: Time To Buy This Unloved Commodities Fund

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Instead of Oil ETFs, Look to Broad-Basket Commodity PDBC

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Hi VettaFi Voices! Commodities have seen outflows year to date overall, and some of the best performers have seen outflows.

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Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF is an exchange-traded fund that offers investors exposure to the world's most heavily traded commodities. The PDBC ETF offers exposure to 14 commodities, adjusting its weighting as per the prevailing market conditions. PDBC does not issue a K-1 tax form, a feature that is likely to appeal to investors wary of the tax complications associated with commodity ETFs.

PDBC: A Solid Broad Commodity Play

A commodity ETF can serve an important role in well-diversified portfolios. As inflation shows signs of reaccelerating and energy prices surge, many investors are allocating to the Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF (PDBC).

Investors Look to PDBC for Commodity ETF Exposure

The threat of a recession looming over the U.S. economy may have turned investors away from commodities. However, the tide could be turning in their favor based on trader activity in exchange traded funds (ETFs).

As Investors Pile Into Commodities, Consider a Diversified ETF

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Given the current global and national economic environment, investors and advisors remain keen on finding new asset classes to put funds into. The main topics and asset classes investors continue to engage with are U.S. fixed income, U.S. equities, and international equities.

Interest in Commodity ETFs Continues to Drop

The US Dollar Index fell below the crucial 100 level on Thursday, with some economists predicting softer US real GDP growth in late 2023 and a potential recession in 2024. Despite a falling dollar and positive economic outlook, commodity prices remain unstable, with the Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF (PDBC) expected to continue fluctuating. The PDBC, which has high exposure to energy-related commodities, has not shown signs of a new bull market, despite US oil prices recently rising above $75.

PDBC: DXY Breaks 100, No Big Benefit For Dollar-Denominated Commodities Yet

Investors who already have allocation to gold in their portfolios are planning to increase their allocations to the metal through 2023, according to a survey released recently by State Street Global Advisors. The study includes more than 1,000 investors with at least $250,000 in investable assets.

Survey: Gold Investors Planning More Allocation

PDBC is the largest and highest-traded commodity ETF and a popular choice among investors. Though its returns are superior to those of its closest competitors, if an investor has room for just one commodity fund in their portfolio, there are better options.

PDBC: Buy/Hold Investors Have Better Options Available

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Invesco Plans ETF Closures as It Refines Product Lineup

The Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF (PDBC) is standing out from its commodities ETFs peers as it continues to accrete strong inflows. PDBC has garnered $232 million in net flows year to date.

Assets Continue to Flow Into Active Commodity ETF PDBC

Metal prices fall from highs, but the trends remain positive. Energy is a mixed picture going into 2022's final month, presenting an opportunity.

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Commodities have not caught a bid even with a weakening U.S. dollar. As fears turn from inflation to recession, commodities could come under further pressure.

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Commodities funds have been doing well this year, while stock and bond markets have bounced around in bear markets. While the S&P 500 is down nearly 17% this year, the S&P GSCI is up more than 10%.

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﻿ VettaFi financial Futurist Dave Nadig joined Invesco's Anna Paglia on ETF Edge with Bob Pisani to discuss tech trends, the search for yield, and commodity trends. After Pisani noted that tech is getting hammered and the Invesco QQ Trust (QQQ) is down 31%, he remarked that flows still seem positive.

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Good, but not as well as hoped. Inflation-hedge ETFs have generally been successful in minimizing losses during the current inflationary environment, less so at generating positive returns.

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