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 811-06463
AIM International Mutual Funds (Invesco International Mutual Funds)
(Exact name of registrant as specified in charter)
11 Greenway Plaza, Suite 1000 Houston, Texas 77046
(Address of principal executive offices) (Zip code)
Sheri Morris 11 Greenway Plaza, Suite 1000 Houston, Texas 77046
(Name and address of agent for service)
Registrant’s telephone number, including area code: (713) 626-1919
Date of fiscal year end: 10/31
Date of reporting period: 04/30/21
| Item 1. | Reports to Stockholders. |
| (a) | The Registrant’s semi-annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 is as follows: |
| (b) | Not applicable |
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|
Semiannual Report to Shareholders
|
April 30, 2021
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| Invesco Advantage International Fund | ||||
|
Nasdaq: | ||||
| A: QMGAX ∎ C: QMGCX ∎ R: QMGRX ∎ Y: QMGYX ∎ R5: GMAGX ∎ R6: QMGIX | ||||
| 2 | Fund Performance | |||
| 4 | Liquidity Risk Management Program | |||
| 5 | Schedule of Investments | |||
| 13 | Financial Statements | |||
| 16 | Financial Highlights | |||
| 17 | Notes to Financial Statements | |||
| 25 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
| Performance summary
|
| |||
| Fund vs. Indexes |
| |||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
| Class A Shares |
21.23 | % | ||
| Class C Shares |
20.81 | |||
| Class R Shares |
21.04 | |||
| Class Y Shares |
21.44 | |||
| Class R5 Shares |
21.32 | |||
| Class R6 Shares |
21.40 | |||
| MSCI All Country World ex USA Indexq |
27.40 | |||
| Source(s): qRIMES Technologies Corp. |
||||
| The MSCI All Country World ex USA® Index is an index considered representative of developed and emerging stock markets, excluding the US. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||
| The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
| A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
| |||
| For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends. |
2 Invesco Advantage International Fund
3 Invesco Advantage International Fund
Liquidity Risk Management Program
| In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco. |
| As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets. |
| At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period. |
| The Report stated, in relevant part, that during the Program Reporting Period: |
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Advantage International Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Advantage International Fund
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Advantage International Fund
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Advantage International Fund
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Advantage International Fund
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Advantage International Fund
| Investment Abbreviations:
| ||
| ADR | - American Depositary Receipt | |
| BR | - Bearer Shares | |
| GDR | - Global Depositary Receipt | |
| PC | - Participation Certificate | |
| Pfd. | - Preferred | |
| REIT | - Real Estate Investment Trust | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Advantage International Fund
Notes to Schedule of Investments:
| (a) | Non-income producing security. |
| (b) | Security valued using significant unobservable inputs (Level 3). See Note 3. |
| (c) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $423,960, which represented 1.93% of the Fund’s Net Assets. |
| (d) | The Fund holds securities which have been issued by the same entity and that trade on separate exchanges. (e) Zero coupon bond issued at a discount. The interest rate shown represents the yield to maturity at issue. |
| (f) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: |
|||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ | 507,570 | $ | 5,101,278 | $ | (3,440,676 | ) | $ | - | $ | - | $ | 2,168,172 | $ | 150 | ||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
362,484 | 3,643,770 | (2,470,304 | ) | 36 | (28 | ) | 1,535,958 | 153 | ||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
580,080 | 5,830,032 | (3,932,202 | ) | - | - | 2,477,910 | 64 | |||||||||||||||||||||||||||
| Total |
$ | 1,450,134 | $ | 14,575,080 | $ | (9,843,182 | ) | $ | 36 | $ | (28 | ) | $ | 6,182,040 | $ | 367 | |||||||||||||||||||
| (g) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| Open Exchange-Traded Index Options Written | ||||||||||||||||||||||||||||||||||||||||
| Description | Type of Contract |
Expiration Date |
Number of Contracts |
Exercise Price |
Premiums Received |
Notional Value* |
Value | Unrealized Appreciation | ||||||||||||||||||||||||||||||||
| Equity Risk |
||||||||||||||||||||||||||||||||||||||||
| MSCI EAFE Index |
Call | 05/21/2021 | 30 | $ | 2,305.00 | $ | (43,409 | ) | $ | 6,915,000 | $ | (22,650 | ) | $ | 20,759 | |||||||||||||||||||||||||
| MSCI Emerging Markets Index |
Call | 05/21/2021 | 25 | 1,400.00 | (24,924 | ) | 3,500,000 | (6,500 | ) | 18,424 | ||||||||||||||||||||||||||||||
| Total Index Options Written |
$ | (68,333 | ) | $ | (29,150 | ) | $ | 39,183 | ||||||||||||||||||||||||||||||||
| * | Notional Value is calculated by multiplying the Number of Contracts by the Exercise Price by the multiplier. |
| Open Futures Contracts(a) | |||||||||||||||||||||||
| Long Futures Contracts | Number of Contracts |
Expiration Month |
Notional Value |
Value | Unrealized Appreciation | ||||||||||||||||||
| Currency Risk |
|||||||||||||||||||||||
| Canadian Dollar |
18 | June-2021 | $ | 1,465,920 | $ | 25,496 | $25,496 | ||||||||||||||||
| Equity Risk |
|||||||||||||||||||||||
| S&P/TSX 60 Index |
8 | June-2021 | 1,477,964 | 21,194 | 21,194 | ||||||||||||||||||
| Total Futures Contracts |
$ | 46,690 | $46,690 | ||||||||||||||||||||
| (a) | Futures contracts collateralized by $93,623 cash held with Merrill Lynch International, the futures commission merchant. |
| Open Over-The-Counter Total Return Swap Agreements(a) | ||||||||||||||||||||||||||||||||||||
| Counterparty | Pay/ Receive |
Reference Entity | Floating Rate Index |
Payment Frequency |
Number of Contracts |
Maturity Date | Notional Value |
Upfront Payments Paid (Received) |
Value | Unrealized Appreciation |
||||||||||||||||||||||||||
| Equity Risk |
||||||||||||||||||||||||||||||||||||
| Goldman Sachs International |
Receive | MSCI EAFE Minimum Volatility Index | 1 Month USD LIBOR |
Monthly | 2,575 | July-2021 | $ | 5,363,303 | $- | $45,484 | $45,484 | |||||||||||||||||||||||||
| Goldman Sachs International |
Receive | MSCI Emerging Markets Minimum Volatility Notes | 1 Month USD LIBOR + 0.83% |
Monthly | 390 | June-2021 | 798,264 | - | 4,610 | 4,610 | ||||||||||||||||||||||||||
| Goldman Sachs International |
Receive | MSCI Emerging Markets Minimum Volatility Notes | 1 Month USD LIBOR + 1.30% |
Monthly | 420 | July-2021 | 858,694 | - | 5,939 | 5,939 | ||||||||||||||||||||||||||
| Total - Total Return Swap Agreements |
$- | $56,033 | $56,033 | |||||||||||||||||||||||||||||||||
| (a) | The Fund receives or pays payments based on any positive or negative return on the Reference Entity, respectively. |
Abbreviations:
LIBOR - London Interbank Offered Rate
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Advantage International Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Financials |
9.25 | % | ||
| Information Technology |
7.57 | |||
| Consumer Discretionary |
7.44 | |||
| Industrials |
7.28 | |||
| Health Care |
6.71 | |||
| Communication Services |
6.62 | |||
| Materials |
5.99 | |||
| Consumer Staples |
5.56 | |||
| Energy |
2.39 | |||
| Other Sectors, Each Less than 2% of Net Assets |
2.55 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
38.64 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco Advantage International Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
13 Invesco Advantage International Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $21,615) |
$ | 235,250 | ||
|
|
||||
| Interest |
34,933 | |||
|
|
||||
| Dividends from affiliated money market funds |
367 | |||
|
|
||||
| Total investment income |
270,550 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
51,356 | |||
|
|
||||
| Administrative services fees |
1,319 | |||
|
|
||||
| Custodian fees |
13,096 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
13,497 | |||
|
|
||||
| Class C |
18,463 | |||
|
|
||||
| Class R |
10,898 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
35,045 | |||
|
|
||||
| Transfer agent fees – R5 |
6 | |||
|
|
||||
| Transfer agent fees – R6 |
1 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
13,235 | |||
|
|
||||
| Registration and filing fees |
36,663 | |||
|
|
||||
| Reports to shareholders |
14,609 | |||
|
|
||||
| Professional services fees |
69,243 | |||
|
|
||||
| Taxes |
1,885 | |||
|
|
||||
| Other |
5,435 | |||
|
|
||||
| Total expenses |
284,751 | |||
|
|
||||
| Less: Fees waived, expenses reimbursed and/or expense offset arrangement(s) |
(177,028 | ) | ||
|
|
||||
| Net expenses |
107,723 | |||
|
|
||||
| Net investment income |
162,827 | |||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
1,333,001 | |||
|
|
||||
| Affiliated investment securities |
(28 | ) | ||
|
|
||||
| Foreign currencies |
1,359 | |||
|
|
||||
| Futures contracts |
282,763 | |||
|
|
||||
| Swap agreements |
253,079 | |||
|
|
||||
| 1,870,174 | ||||
|
|
||||
| Change in net unrealized appreciation of: |
||||
| Unaffiliated investment securities |
1,460,251 | |||
|
|
||||
| Affiliated investment securities |
36 | |||
|
|
||||
| Foreign currencies |
595 | |||
|
|
||||
| Futures contracts |
101,835 | |||
|
|
||||
| Option contracts written |
39,183 | |||
|
|
||||
| Swap agreements |
146,830 | |||
|
|
||||
| 1,748,730 | ||||
|
|
||||
| Net realized and unrealized gain |
3,618,904 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 3,781,731 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
14 Invesco Advantage International Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income |
$ | 162,827 | $ | 495,366 | ||||
|
|
||||||||
| Net realized gain |
1,870,174 | 692,803 | ||||||
|
|
||||||||
| Change in net unrealized appreciation (depreciation) |
1,748,730 | (4,788,977 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from operations |
3,781,731 | (3,600,808 | ) | |||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(8,308 | ) | (368,895 | ) | ||||
|
|
||||||||
| Class C |
(2,808 | ) | (19,719 | ) | ||||
|
|
||||||||
| Class R |
(3,184 | ) | (19,406 | ) | ||||
|
|
||||||||
| Class Y |
(732 | ) | (8,268 | ) | ||||
|
|
||||||||
| Class R5 |
(9 | ) | (61 | ) | ||||
|
|
||||||||
| Class R6 |
(1 | ) | (63 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(15,042 | ) | (416,412 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
361,038 | (50,065,965 | ) | |||||
|
|
||||||||
| Class C |
(171,398 | ) | (5,740 | ) | ||||
|
|
||||||||
| Class R |
209,483 | 405,109 | ||||||
|
|
||||||||
| Class Y |
136,393 | (516,154 | ) | |||||
|
|
||||||||
| Class R6 |
130 | (9,024 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
535,646 | (50,191,774 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets |
4,302,335 | (54,208,994 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
17,684,560 | 71,893,554 | ||||||
|
|
||||||||
| End of period |
$ | 21,986,895 | $ | 17,684,560 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
15 Invesco Advantage International Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income(a) |
Net
gains realized and |
Total
from operations |
Dividends investment income |
Distributions from net realized |
Total distributions |
Net
asset of period |
Total return (b) |
Net assets, (000’s omitted) |
Ratio
of net
assets |
Ratio
of fee
waivers |
Ratio of net investment |
Portfolio turnover (d) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 10.83 | $ | 0.11 | $ | 2.19 | $ | 2.30 | $ | – | $ | (0.01 | ) | $ | (0.01 | ) | $ | 13.12 | 21.23 | %(e) | $ | 12,406 | 0.86 | %(e)(f) | 2.52 | %(e)(f) | 1.72 | %(e)(f) | 82 | % | ||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.90 | 0.12 | (0.13 | ) | (0.01 | ) | – | (0.06 | ) | (0.06 | ) | 10.83 | (0.09 | ) | 9,934 | 0.94 | 1.74 | 1.08 | 238 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.57 | 0.09 | 0.82 | 0.91 | 0.00 | (0.58 | ) | (0.58 | ) | 10.90 | 9.51 | 63,878 | 1.14 | 1.53 | 0.91 | 43 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
11.62 | 0.17 | (0.96 | ) | (0.79 | ) | (0.05 | ) | (0.21 | ) | (0.26 | ) | 10.57 | (6.98 | ) | 60,916 | 1.17 | 1.49 | 1.48 | 126 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.49 | 0.15 | 1.48 | 1.63 | (0.50 | ) | – | (0.50 | ) | 11.62 | 16.26 | 64,323 | 1.10 | 1.47 | 1.41 | 54 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.30 | 0.14 | 0.14 | 0.28 | (0.09 | ) | – | (0.09 | ) | 10.49 | 2.73 | 53,579 | 1.10 | 1.42 | 1.38 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.52 | 0.06 | 2.13 | 2.19 | – | (0.01 | ) | (0.01 | ) | 12.70 | 20.81 | 3,746 | 1.61 | (f) | 3.29 | (f) | 0.97 | (f) | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.66 | 0.04 | (0.12 | ) | (0.08 | ) | – | (0.06 | ) | (0.06 | ) | 10.52 | (0.75 | ) | 3,241 | 1.65 | 2.49 | 0.37 | 238 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.42 | 0.02 | 0.80 | 0.82 | – | (0.58 | ) | (0.58 | ) | 10.66 | 8.73 | 3,294 | 1.89 | 2.43 | 0.16 | 43 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
11.50 | 0.08 | (0.95 | ) | (0.87 | ) | – | (0.21 | ) | (0.21 | ) | 10.42 | (7.72 | ) | 3,649 | 1.92 | 2.62 | 0.73 | 126 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.41 | 0.07 | 1.47 | 1.54 | (0.45 | ) | – | (0.45 | ) | 11.50 | 15.42 | 1,701 | 1.85 | 2.98 | 0.67 | 54 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.29 | 0.04 | 0.15 | 0.19 | (0.07 | ) | – | (0.07 | ) | 10.41 | 1.88 | 522 | 1.85 | 3.05 | 0.36 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.74 | 0.09 | 2.17 | 2.26 | – | (0.01 | ) | (0.01 | ) | 12.99 | 21.04 | 4,596 | 1.11 | (f) | 2.79 | (f) | 1.47 | (f) | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.83 | 0.09 | (0.12 | ) | (0.03 | ) | – | (0.06 | ) | (0.06 | ) | 10.74 | (0.28 | ) | 3,607 | 1.14 | 1.99 | 0.88 | 238 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.52 | 0.07 | 0.82 | 0.89 | – | (0.58 | ) | (0.58 | ) | 10.83 | 9.35 | 3,266 | 1.39 | 1.94 | 0.66 | 43 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
11.58 | 0.14 | (0.96 | ) | (0.82 | ) | (0.03 | ) | (0.21 | ) | (0.24 | ) | 10.52 | (7.29 | ) | 2,513 | 1.42 | 2.15 | 1.23 | 126 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.47 | 0.13 | 1.47 | 1.60 | (0.49 | ) | – | (0.49 | ) | 11.58 | 16.03 | 2,533 | 1.35 | 2.57 | 1.17 | 54 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.30 | 0.04 | 0.21 | 0.25 | (0.08 | ) | – | (0.08 | ) | 10.47 | 2.43 | 1,204 | 1.33 | 2.07 | 0.43 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.91 | 0.13 | 2.21 | 2.34 | – | (0.01 | ) | (0.01 | ) | 13.24 | 21.44 | 1,224 | 0.61 | (f) | 2.29 | (f) | 1.97 | (f) | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.95 | 0.14 | (0.12 | ) | 0.02 | – | (0.06 | ) | (0.06 | ) | 10.91 | 0.18 | 890 | 0.71 | 1.49 | 1.31 | 238 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.60 | 0.11 | 0.82 | 0.93 | – | (0.58 | ) | (0.58 | ) | 10.95 | 9.67 | 1,433 | 0.99 | 1.36 | 1.06 | 43 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
11.65 | 0.19 | (0.97 | ) | (0.78 | ) | (0.06 | ) | (0.21 | ) | (0.27 | ) | 10.60 | (6.86 | ) | 450 | 1.02 | 1.63 | 1.63 | 126 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.51 | 0.17 | 1.47 | 1.64 | (0.50 | ) | – | (0.50 | ) | 11.65 | 16.41 | 271 | 0.95 | 2.65 | 1.57 | 54 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.31 | 0.12 | 0.17 | 0.29 | (0.09 | ) | – | (0.09 | ) | 10.51 | 2.86 | 89 | 0.94 | 1.52 | 1.13 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.88 | 0.13 | 2.19 | 2.32 | – | (0.01 | ) | (0.01 | ) | 13.19 | 21.32 | 13 | 0.61 | (f) | 2.06 | (f) | 1.97 | (f) | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.91 | 0.15 | (0.12 | ) | 0.03 | – | (0.06 | ) | (0.06 | ) | 10.88 | 0.28 | 11 | 0.66 | 1.47 | 1.36 | 238 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/19(g) |
10.27 | 0.05 | 0.59 | 0.64 | – | – | – | 10.91 | 6.23 | 11 | 1.94 | (h) | 1.26 | (h) | 1.11 | (h) | 43 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.93 | 0.13 | 2.20 | 2.33 | – | (0.01 | ) | (0.01 | ) | 13.25 | 21.31 | 2 | 0.61 | (f) | 2.06 | (f) | 1.97 | (f) | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.96 | 0.14 | (0.11 | ) | 0.03 | – | (0.06 | ) | (0.06 | ) | 10.93 | 0.28 | 2 | 0.68 | 1.47 | 1.34 | 238 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.59 | 0.12 | 0.83 | 0.95 | – | (0.58 | ) | (0.58 | ) | 10.96 | 9.88 | 11 | 0.89 | 1.21 | 1.16 | 43 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
11.65 | 0.20 | (0.97 | ) | (0.77 | ) | (0.08 | ) | (0.21 | ) | (0.29 | ) | 10.59 | (6.84 | ) | 10 | 0.92 | 1.24 | 1.74 | 126 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.51 | 0.18 | 1.48 | 1.66 | (0.52 | ) | – | (0.52 | ) | 11.65 | 16.60 | 12 | 0.85 | 1.21 | 1.66 | 54 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.31 | 0.16 | 0.13 | 0.29 | (0.09 | ) | – | (0.09 | ) | 10.51 | 2.91 | 11 | 0.85 | 1.19 | 1.61 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | 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. Because the underlying funds have varied expenses and fee levels and the Fund may own different proportions at different times, the amount of fees and expenses incurred indirectly by the Fund will vary. Estimated underlying fund expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the underlying funds and are deducted from the value of the funds the Fund invests in. The effect of the estimated underlying fund expenses that the Fund bears indirectly is included in the Fund’s total return. Estimated acquired fund fees from underlying funds were 0.14%, 0.17%, 0.15% and 0.11% for the years ended October 31, 2019, 2018, 2017 and 2016, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.23% for the six months ended April 30, 2021. |
| (f) | Ratios are annualized and based on average daily net assets (000’s omitted) of $11,924, $3,723, $4,395, $1,079, $12 and $2 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (g) | Commencement date after the close of business on May 24, 2019. |
| (h) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
16 Invesco Advantage International Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Advantage International Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services - Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations - Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income - Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
17 Invesco Advantage International Fund
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date.
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination - For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions - Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes - The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses - Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications - Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations - Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| J. | Forward Foreign Currency Contracts - The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
18 Invesco Advantage International Fund
forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| K. | Futures Contracts - The Fund may enter into futures contracts to manage exposure to interest rate, equity and market price movements and/or currency risks. A futures contract is an agreement between Counterparties to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Statement of Assets and Liabilities. |
| L. | Call Options Purchased and Written - The Fund may write call options and/or buy call options. A covered call option gives the purchaser of such option the right to buy, and the writer the obligation to sell, the underlying security or foreign currency at the stated exercise price during the option period. An uncovered call option exists without the ownership of the underlying security. Options written by the Fund normally will have expiration dates between three and nine months from the date written. The exercise price of a call option may be below, equal to, or above the current market value of the underlying security at the time the option is written. |
Additionally, the Fund may enter into an option on a swap agreement, also called a “swaption”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based premium. A receiver swaption gives the owner the right to receive the total return of a specified asset, reference rate or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the Counterparties.
When the Fund writes a covered call option, an amount equal to the premium received by the Fund is recorded as an asset and an equivalent liability in the Statement of Assets and Liabilities. The amount of the liability is subsequently “marked-to-market” to reflect the current market value of the option written. If a written covered call option expires on the stipulated expiration date, 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 covered call option is exercised, the Fund realizes a gain or a loss from the sale of the underlying security and the proceeds of the sale are increased by the premium originally received. Realized and unrealized gains and losses on call options written are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Option contracts written. A risk in writing a covered call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing an uncovered call option is that the Fund may incur significant losses if the value of the written security exceeds the exercise price of the option.
When the Fund buys a call option, an amount equal to the premium paid by the Fund is recorded as an investment on the Statement of Assets and Liabilities. The amount of the investment is subsequently “marked-to-market” to reflect the current value of the option purchased. Realized and unrealized gains and losses on call options purchased are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased.
| M. | Swap Agreements - The Fund may enter into various swap transactions, including interest rate, total return, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, currency or credit risk. Such transactions are agreements between Counterparties. A swap agreement may be negotiated bilaterally and traded over-the-counter (“OTC”) between two parties (“uncleared/ OTC”) or, in some instances, must be transacted through a future commission merchant (“FCM”) and cleared through a clearinghouse that serves as a central Counterparty (“centrally cleared swap”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/ or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, index, and currency 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.
In a centrally cleared swap, the Fund’s ultimate Counterparty is a central clearinghouse. The Fund initially will enter into centrally cleared swaps through an executing broker. When a fund enters into a centrally cleared swap, it must deliver to the central Counterparty (via the FCM) an amount referred to as “initial margin.” Initial margin requirements are determined by the central Counterparty, but an FCM may require additional initial margin above the amount required by the central Counterparty. Initial margin deposits required upon entering into centrally cleared swaps are satisfied by cash or securities as collateral at the FCM. Securities deposited as initial margin are designated on the Schedule of Investments and cash deposited is recorded on the Statement of Assets and Liabilities. During the term of a cleared swap agreement, a “variation margin” amount may be required to be paid by the Fund or may be received by the Fund, based on the daily change in price of the underlying reference instrument subject to the swap agreement and is recorded as a receivable or payable for variation margin in the Statement of Assets and Liabilities until the centrally cleared swap is terminated at which time a realized gain or loss is recorded.
A CDS is an agreement between Counterparties to exchange the credit risk of an issuer. A buyer of a CDS is said to buy protection by paying a fixed payment over the life of the agreement and in some situations an upfront payment to the seller of the CDS. If a defined credit event occurs (such as payment default or bankruptcy), the Fund as a protection buyer would cease paying its fixed payment, the Fund would deliver eligible bonds issued by the reference entity to the seller, and the seller would pay the full notional value, or the “par value”, of the referenced obligation to the Fund. A seller of a CDS is said to sell protection and thus would receive a fixed payment over the life of the agreement and an upfront payment, if applicable. If a credit event occurs, the Fund as a protection seller would cease to receive the fixed payment stream, the Fund would pay the buyer “par value” or the full notional value of the referenced obligation, and the Fund would receive the eligible bonds issued by the reference entity. In turn, these bonds may be sold in order to realize a recovery value. Alternatively, the seller of the CDS and its Counterparty may agree to net the notional amount and the market value of the bonds and make a cash payment equal to the difference to the buyer of protection. If no credit event occurs, the Fund receives the fixed payment over the life of the agreement. As the seller, the Fund would effectively add leverage to its portfolio because, in addition to its total net assets, the Fund would be subject to investment exposure on the notional amount of the CDS. In connection with these agreements, cash and securities may be identified as collateral in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default under the swap agreement or bankruptcy/insolvency of a party to the swap agreement. If a Counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, the Fund may experience significant delays in obtaining any recovery in
19 Invesco Advantage International Fund
a bankruptcy or other reorganization proceeding. The Fund may obtain only limited recovery or may obtain no recovery in such circumstances. 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 designation of collateral by the Counterparty to cover the Fund’s exposure to the Counterparty.
Implied credit spreads represent the current level at which protection could be bought or sold given the terms of the existing CDS contract and serve as an indicator of the current status of the payment/performance risk of the CDS. An implied spread that has widened or increased since entry into the initial contract may indicate a deteriorating credit profile and increased risk of default for the reference entity. A declining or narrowing spread may indicate an improving credit profile or decreased risk of default for the reference entity. Alternatively, credit spreads may increase or decrease reflecting the general tolerance for risk in the credit markets.
An interest rate swap is an agreement between Counterparties pursuant to which the parties exchange a floating rate payment for a fixed rate payment based on a specified notional amount.
A total return swap is an agreement in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income generated and capital gains, if any. The unrealized appreciation (depreciation) on total return swaps includes dividends on the underlying securities and financing rate payable from the Counterparty. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
Changes in the value of centrally cleared and OTC swap agreements are recognized as unrealized gains (losses) in the Statement 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 Statement 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 Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Statement of Assets and Liabilities. 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 Statement 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. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. Additionally, an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) includes credit related contingent features which allow Counterparties to OTC derivatives to terminate derivative contracts prior to maturity in the event that, for example, the Fund’s net assets decline by a stated percentage or the Fund fails to meet the terms of its ISDA master agreements, which would cause the Fund to accelerate payment of any net liability owed to the Counterparty. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
| N. | LIBOR Risk - The Fund may invest in financial instruments that utilize LIBOR as the reference or benchmark rate for variable interest rate calculations. On July 27, 2017, the head of the United Kingdom’s Financial Conduct Authority announced a desire to phase out the use of LIBOR by the end of 2021. Although many LIBOR rates will be phased out at the end of 2021 as originally intended, a selection of widely used USD LIBOR rates will continue to be published until June 2023 in order to assist with the transition. There remains uncertainty regarding the effect of the LIBOR transition process and therefore any impact of a transition away from LIBOR on the Fund or the instruments in which the Fund invests cannot yet be determined. There is no assurance that the composition or characteristics of any alternative reference rate will be similar to or produce the same value or economic equivalence as LIBOR or that instruments using an alternative rate will have the same volume or liquidity. Any such effects of the transition away from LIBOR and the adoption of alternative reference rates could result in losses to the Fund. |
| O. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
| P. | Other Risks - Active trading of portfolio securities may result in added expenses, a lower return and increased tax liability. |
| Q. | Leverage Risk - Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets* | Rate | |||
| Up to $500 million |
0.490 | % | ||
| Next $500 million |
0.470 | % | ||
| Next $4.0 billion |
0.440 | % | ||
| Over $5.0 billion |
0.420 | % | ||
| * | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.49%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through at least February 28, 2022, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 0.85%, 1.60%, 1.10%, 0.60%, 0.60% and 0.60%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining
20 Invesco Advantage International Fund
the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limit, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $51,356, reimbursed fund level expenses of $90,463 and reimbursed class level expenses of $19,784, $6,178, $7,293, $1,790, $6 and $1 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $8,101 in front-end sales commissions from the sale of Class A shares and $0 and $0 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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.
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
During the six months ended April 30, 2021, there were transfers from Level 2 to Level 3 of $3,416, due to lack of availability of market data for this security.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
| Investments in Securities |
||||||||||||||||
|
|
||||||||||||||||
| Australia |
$ | – | $ | 678,668 | $ | – | $ | 678,668 | ||||||||
|
|
||||||||||||||||
| Austria |
– | 9,586 | – | 9,586 | ||||||||||||
|
|
||||||||||||||||
| Belgium |
– | 76,485 | – | 76,485 | ||||||||||||
|
|
||||||||||||||||
| Brazil |
442,835 | – | – | 442,835 | ||||||||||||
|
|
||||||||||||||||
| Chile |
20,145 | – | – | 20,145 | ||||||||||||
|
|
||||||||||||||||
| China |
863,931 | 1,096,089 | 5,639 | 1,965,659 | ||||||||||||
|
|
||||||||||||||||
| Colombia |
6,949 | – | – | 6,949 | ||||||||||||
|
|
||||||||||||||||
| Denmark |
– | 372,088 | – | 372,088 | ||||||||||||
|
|
||||||||||||||||
| Finland |
– | 79,988 | – | 79,988 | ||||||||||||
|
|
||||||||||||||||
| France |
700 | 937,666 | – | 938,366 | ||||||||||||
|
|
||||||||||||||||
| Germany |
– | 813,621 | – | 813,621 | ||||||||||||
|
|
||||||||||||||||
| Hong Kong |
– | 350,399 | – | 350,399 | ||||||||||||
|
|
||||||||||||||||
21 Invesco Advantage International Fund
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
|
|
||||||||||||||||
| Indonesia |
$ – | $ 58,286 | $ – | $ 58,286 | ||||||||||||
|
|
||||||||||||||||
| Ireland |
– | 69,931 | – | 69,931 | ||||||||||||
|
|
||||||||||||||||
| Israel |
3,037 | – | – | 3,037 | ||||||||||||
|
|
||||||||||||||||
| Italy |
– | 159,350 | – | 159,350 | ||||||||||||
|
|
||||||||||||||||
| Japan |
– | 2,197,944 | – | 2,197,944 | ||||||||||||
|
|
||||||||||||||||
| Macau |
– | 8,780 | – | 8,780 | ||||||||||||
|
|
||||||||||||||||
| Malaysia |
– | 61,177 | – | 61,177 | ||||||||||||
|
|
||||||||||||||||
| Mexico |
137,256 | – | – | 137,256 | ||||||||||||
|
|
||||||||||||||||
| Multinational |
– | – | 247,869 | 247,869 | ||||||||||||
|
|
||||||||||||||||
| Netherlands |
57,560 | 479,335 | – | 536,895 | ||||||||||||
|
|
||||||||||||||||
| Norway |
– | 27,339 | – | 27,339 | ||||||||||||
|
|
||||||||||||||||
| Peru |
7,761 | – | – | 7,761 | ||||||||||||
|
|
||||||||||||||||
| Philippines |
– | 20,188 | – | 20,188 | ||||||||||||
|
|
||||||||||||||||
| Poland |
– | 18,777 | – | 18,777 | ||||||||||||
|
|
||||||||||||||||
| Russia |
229,716 | 19,416 | – | 249,132 | ||||||||||||
|
|
||||||||||||||||
| Saudi Arabia |
– | 8,256 | – | 8,256 | ||||||||||||
|
|
||||||||||||||||
| Singapore |
– | 18,865 | – | 18,865 | ||||||||||||
|
|
||||||||||||||||
| South Africa |
– | 147,080 | – | 147,080 | ||||||||||||
|
|
||||||||||||||||
| South Korea |
– | 466,901 | – | 466,901 | ||||||||||||
|
|
||||||||||||||||
| Spain |
– | 242,172 | – | 242,172 | ||||||||||||
|
|
||||||||||||||||
| Sweden |
– | 234,762 | – | 234,762 | ||||||||||||
|
|
||||||||||||||||
| Switzerland |
– | 874,724 | – | 874,724 | ||||||||||||
|
|
||||||||||||||||
| Taiwan |
477,496 | 411,759 | – | 889,255 | ||||||||||||
|
|
||||||||||||||||
| Tanzania |
– | 2,947 | – | 2,947 | ||||||||||||
|
|
||||||||||||||||
| Turkey |
– | 28,001 | – | 28,001 | ||||||||||||
|
|
||||||||||||||||
| United Kingdom |
10,341 | 858,333 | – | 868,674 | ||||||||||||
|
|
||||||||||||||||
| United States |
74,207 | 78,178 | – | 152,385 | ||||||||||||
|
|
||||||||||||||||
| Vietnam |
– | 8 | – | 8 | ||||||||||||
|
|
||||||||||||||||
| Money Market Funds |
6,182,040 | – | – | 6,182,040 | ||||||||||||
|
|
||||||||||||||||
| Total Investments in Securities |
8,513,974 | 10,907,099 | 253,508 | 19,674,581 | ||||||||||||
|
|
||||||||||||||||
| Other Investments - Assets* |
||||||||||||||||
|
|
||||||||||||||||
| Futures Contracts |
46,690 | – | – | 46,690 | ||||||||||||
|
|
||||||||||||||||
| Swap Agreements |
– | 56,033 | – | 56,033 | ||||||||||||
|
|
||||||||||||||||
| 46,690 | 56,033 | – | 102,723 | |||||||||||||
|
|
||||||||||||||||
| Other Investments - Liabilities* |
||||||||||||||||
|
|
||||||||||||||||
| Options Written |
(29,150 | ) | – | – | (29,150 | ) | ||||||||||
|
|
||||||||||||||||
| Total Other Investments |
17,540 | 56,033 | – | 73,573 | ||||||||||||
|
|
||||||||||||||||
| Total Investments |
$8,531,514 | $10,963,132 | $253,508 | $19,748,154 | ||||||||||||
|
|
||||||||||||||||
| * | Futures contracts and swap agreements are valued at unrealized appreciation (depreciation). Options written are shown at value. |
A reconciliation of Level 3 investments is presented when the Fund had a significant amount of Level 3 investments at the beginning and/or end of the reporting period in relation to net assets.
The following is a reconciliation of the fair valuations using significant unobservable inputs (Level 3) during the six months ended April 30, 2021:
| Value 10/31/2020 |
Purchases at Cost |
Proceeds from Sales |
Accrued Discounts/ Premiums |
Realized Gain (Loss) |
Change in Unrealized Appreciation (Depreciation) |
Transfers into Level 3 |
Transfers out of Level 3 |
Value 04/30/2021 | |||||||||||||||||||||||||||||||||||||
| Common Stocks & Other Equity Interests |
$ | - | $ | 1,781 | $ | - | $ | - | $ | - | $ | 442 | $ | 3,416 | $ | - | $ | 5,639 | |||||||||||||||||||||||||||
| Preferred Stocks |
320,343 | - | (113,026 | ) | - | (1,502 | ) | (64,358 | ) | - | - | 141,457 | |||||||||||||||||||||||||||||||||
| U.S. Dollar Denominated Bonds & Notes |
92,649 | - | (8,313 | ) | - | 723 | 21,353 | - | - | 106,412 | |||||||||||||||||||||||||||||||||||
| Total |
$ | 412,992 | $ | 1,781 | $ | (121,339 | ) | $ | - | $ | (779 | ) | $ | (42,563 | ) | $ | 3,416 | $ | - | $ | 253,508 | ||||||||||||||||||||||||
NOTE 4–Derivative Investments
The Fund may enter into an ISDA Master Agreement under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
22 Invesco Advantage International Fund
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2021:
| Value | ||||||||
| Derivative Assets | Currency Risk |
Equity Risk |
Total | |||||
|
|
||||||||
| Unrealized appreciation on futures contracts – Exchange-Traded(a) |
$ 25,496 | $ 21,194 | $ 46,690 | |||||
|
|
||||||||
| Unrealized appreciation on swap agreements – OTC |
- | 56,033 | 56,033 | |||||
|
|
||||||||
| Total Derivative Assets |
25,496 | 77,227 | 102,723 | |||||
|
|
||||||||
| Derivatives not subject to master netting agreements |
(25,496) | (21,194) | (46,690 | ) | ||||
|
|
||||||||
| Total Derivative Assets subject to master netting agreements |
$ - | $ 56,033 | $ 56,033 | |||||
|
|
||||||||
| (a) | The daily variation margin receivable at period-end is recorded in the Statement of Assets and Liabilities. |
| Value | ||||||||
| Derivative Liabilities | Currency Risk |
Equity Risk |
Total | |||||
|
|
||||||||
| Options written, at value – Exchange-Traded |
$- | $(29,150) | $(29,150 | ) | ||||
|
|
||||||||
| Derivatives not subject to master netting agreements |
- | 29,150 | 29,150 | |||||
|
|
||||||||
| Total Derivative Liabilities subject to master netting agreements |
$- | $ - | $ - | |||||
|
|
||||||||
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2021.
| Financial | Financial | |||||||||||||||||||||||||||||
| Derivative | Derivative | Collateral | ||||||||||||||||||||||||||||
| Assets | Liabilities | (Received)/Pledged | ||||||||||||||||||||||||||||
| Swap | Swap | Net Value of | Net | |||||||||||||||||||||||||||
| Counterparty | Agreement | Agreement | Derivatives | Non-Cash | Cash | Amount | ||||||||||||||||||||||||
| Goldman Sachs International |
$ | 56,033 | $ | - | $ | 56,033 | - | - | $ | 56,033 | ||||||||||||||||||||
Effect of Derivative Investments for the six months ended April 30, 2021
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
| Location of Gain on Statement of Operations | |||||||||||||||
| Currency | Equity | ||||||||||||||
| Risk | Risk | Total | |||||||||||||
| Realized Gain: |
|||||||||||||||
| Futures contracts |
$ | 62,727 | $ | 220,036 | $ | 282,763 | |||||||||
| Swap agreements |
- | 253,079 | 253,079 | ||||||||||||
| Change in Net Unrealized Appreciation: |
|||||||||||||||
| Futures contracts |
36,637 | 65,198 | 101,835 | ||||||||||||
| Options written |
- | 39,183 | 39,183 | ||||||||||||
| Swap agreements |
- | 146,830 | 146,830 | ||||||||||||
|
Total |
$ | 99,364 | $ | 724,326 | $ | 823,690 | |||||||||
The table below summarizes the average notional value of derivatives held during the period.
| Index | |||||||||||||||
| Futures | Options | Swap | |||||||||||||
| Contracts | Written | Agreements | |||||||||||||
| Average notional value |
$ | 2,661,315 | $ | 10,415,000 | $ | 4,346,538 | |||||||||
NOTE 5–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $157.
NOTE 6–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under
23 Invesco Advantage International Fund
such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 8–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 9–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $12,517,975 and $15,748,136, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 3,015,644 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(310,890 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 2,704,754 | ||
|
|
||||
Cost of investments for tax purposes is $ 17,043,400.
NOTE 10–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended | Year ended | |||||||||||||||
| April 30, 2021 | October 31, 2020 | |||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
165,241 | $ | 2,125,207 | 236,032 | $ | 2,539,796 | ||||||||||
|
|
||||||||||||||||
| Class C |
30,101 | 373,227 | 80,417 | 845,253 | ||||||||||||
|
|
||||||||||||||||
| Class R |
72,239 | 903,426 | 117,852 | 1,265,985 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
17,912 | 230,231 | 39,742 | 367,333 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
10 | 130 | 140 | 1,500 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
668 | 8,294 | 4,863 | 55,103 | ||||||||||||
|
|
||||||||||||||||
| Class C |
231 | 2,785 | 1,776 | 19,657 | ||||||||||||
|
|
||||||||||||||||
| Class R |
259 | 3,184 | 1,720 | 19,343 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
57 | 714 | 720 | 8,205 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
10,596 | 133,263 | 2,605 | 28,708 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(10,921 | ) | (133,263 | ) | (2,680 | ) | (28,708 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(148,338 | ) | (1,905,726 | ) | (5,186,883 | ) | (52,689,572 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(32,412 | ) | (414,147 | ) | (80,549 | ) | (841,942 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(54,684 | ) | (697,127 | ) | (85,304 | ) | (880,219 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(7,075 | ) | (94,552 | ) | (89,689 | ) | (891,692 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
- | - | (1,000 | ) | (10,524 | ) | ||||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
43,884 | $ | 535,646 | (4,960,238 | ) | $ | (50,191,774 | ) | ||||||||
|
|
||||||||||||||||
24 Invesco Advantage International Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL (5% annual return before expenses) |
|||||||||||||||||||||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Expense Ratio | |||||||||||||||||||||||||
|
Class A |
$1,000.00 | $1,212.30 | $4.72 | $1,020.53 | $4.31 | 0.86% | ||||||||||||||||||||||||
|
Class C |
1,000.00 | 1,208.10 | 8.81 | 1,016.81 | 8.05 | 1.61 | ||||||||||||||||||||||||
|
Class R |
1,000.00 | 1,210.40 | 6.08 | 1,019.29 | 5.56 | 1.11 | ||||||||||||||||||||||||
|
Class Y |
1,000.00 | 1,214.40 | 3.35 | 1,021.77 | 3.06 | 0.61 | ||||||||||||||||||||||||
|
Class R5 |
1,000.00 | 1,213.20 | 3.35 | 1,021.77 | 3.06 | 0.61 | ||||||||||||||||||||||||
|
Class R6 |
1,000.00 | 1,214.00 | 3.35 | 1,021.77 | 3.06 | 0.61 | ||||||||||||||||||||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
25 Invesco Advantage International Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents. With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | O-GLMAG-SAR-1 |
|
| ||||
|
|
Semiannual Report to Shareholders | April 30, 2021 | ||
|
Invesco Asia Pacific Growth Fund | ||||
|
Nasdaq: |
||||
| A: ASIAX ∎ C: ASICX ∎ Y: ASIYX ∎ R6: ASISX | ||||
| 2 | Fund Performance | |||||
| 4 | Liquidity Risk Management Program | |||||
| 5 | Schedule of Investments | |||||
| 7 | Financial Statements | |||||
| 10 | Financial Highlights | |||||
| 11 | Notes to Financial Statements | |||||
| 16 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
|
Performance summary
| ||
| Fund vs. Indexes |
||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. | ||
| Class A Shares |
15.12% | |
| Class C Shares |
14.70 | |
| Class Y Shares |
15.30 | |
| Class R6 Shares |
15.39 | |
| MSCI All Country Asia Pacific ex-Japan Indexq (Broad Market/Style-Specific Index) |
22.89 | |
| Lipper Pacific ex-Japan Funds Index∎ (Peer Group Index) |
21.65 | |
| Source(s): qRIMES Technologies Corp.; ∎Lipper Inc. |
||
| The MSCI All Country Asia Pacific ex-Japan Index is an unmanaged index considered representative of Asia Pacific region stock markets, excluding Japan. The index is computed using the net return, which withholds applicable taxes for non-resident investors. | ||
| The Lipper Pacific ex-Japan Funds Index is an unmanaged index considered representative of Pacific region ex-Japan funds tracked by Lipper. | ||
| The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). | ||
| A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
| ||
| For more information about your Fund |
| Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
|
2 Invesco Asia Pacific Growth Fund
3 Invesco Asia Pacific Growth Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Asia Pacific Growth Fund
April 30, 2021
(Unaudited)
Investment Abbreviations:
ADR - American Depositary Receipt
CDI - CREST Depository Interest
REIT - Real Estate Investment Trust
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Asia Pacific Growth Fund
Notes to Schedule of Investments:
| (a) | Non-income producing security. |
| (b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $40,047,226, which represented 4.98% of the Fund’s Net Assets. |
| (c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | ||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: |
|
|||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$23,355,433 | $25,272,647 | $(30,385,178) | $ - | $ - | $18,242,902 | $2,598 | |||||||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
17,003,608 | 18,051,891 | (21,703,699) | 870 | (874) | 13,351,796 | 3,452 | |||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
26,691,924 | 28,883,025 | (34,725,918) | - | - | 20,849,031 | 1,250 | |||||||||||||||||||||||||
| Total |
$67,050,965 | $72,207,563 | $(86,814,795) | $870 | $(874) | $52,443,729 | $7,300 | |||||||||||||||||||||||||
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Consumer Discretionary |
21.07 | % | ||
| Information Technology |
19.81 | |||
| Consumer Staples |
13.33 | |||
| Real Estate |
12.05 | |||
| Financials |
10.14 | |||
| Communication Services |
9.68 | |||
| Industrials |
3.21 | |||
| Health Care |
2.35 | |||
| Materials |
1.87 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
6.49 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Asia Pacific Growth Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Asia Pacific Growth Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $527,839) |
$ | 5,622,997 | ||
|
|
||||
| Dividends from affiliated money market funds |
7,300 | |||
|
|
||||
| Total investment income |
5,630,297 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
3,664,438 | |||
|
|
||||
| Administrative services fees |
53,594 | |||
|
|
||||
| Custodian fees |
89,271 | |||
|
|
||||
| Distribution fees: |
||||
|
|
||||
| Class A |
617,219 | |||
|
|
||||
| Class C |
110,605 | |||
|
|
||||
| Transfer agent fees – A, C and Y |
598,428 | |||
|
|
||||
| Transfer agent fees – R6 |
3,023 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
20,569 | |||
|
|
||||
| Registration and filing fees |
38,067 | |||
|
|
||||
| Reports to shareholders |
48,916 | |||
|
|
||||
| Professional services fees |
30,091 | |||
|
|
||||
| Other |
15,975 | |||
|
|
||||
| Total expenses |
5,290,196 | |||
|
|
||||
| Less: Fees waived and/or expense offset arrangement(s) |
(23,812 | ) | ||
|
|
||||
| Net expenses |
5,266,384 | |||
|
|
||||
| Net investment income |
363,913 | |||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
30,444,133 | |||
|
|
||||
| Affiliated investment securities |
(874 | ) | ||
|
|
||||
| Foreign currencies |
(50,967 | ) | ||
|
|
||||
| 30,392,292 | ||||
|
|
||||
| Change in net unrealized appreciation (depreciation) of: |
||||
| Unaffiliated investment securities (net of foreign taxes of $139,409) |
78,808,495 | |||
|
|
||||
| Affiliated investment securities |
870 | |||
|
|
||||
| Foreign currencies |
(7,014 | ) | ||
|
|
||||
| 78,802,351 | ||||
|
|
||||
| Net realized and unrealized gain |
109,194,643 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 109,558,556 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Asia Pacific Growth Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations:
|
||||||||
| Net investment income |
$ | 363,913 | $ | 3,393,922 | ||||
|
|
||||||||
| Net realized gain |
30,392,292 | 54,458,297 | ||||||
|
|
||||||||
| Change in net unrealized appreciation |
78,802,351 | 45,402,259 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
109,558,556 | 103,254,478 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings:
|
||||||||
| Class A |
(33,752,095 | ) | (28,385,727 | ) | ||||
|
|
||||||||
| Class C |
(1,877,272 | ) | (1,894,754 | ) | ||||
|
|
||||||||
| Class Y |
(12,868,796 | ) | (11,193,927 | ) | ||||
|
|
||||||||
| Class R6 |
(8,742,429 | ) | (7,091,434 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(57,240,592 | ) | (48,565,842 | ) | ||||
|
|
||||||||
| Share transactions–net:
|
||||||||
| Class A |
24,603,331 | (28,296,505 | ) | |||||
|
|
||||||||
| Class C |
(4,876,174 | ) | (9,566,312 | ) | ||||
|
|
||||||||
| Class Y |
30,339,511 | (26,920,201 | ) | |||||
|
|
||||||||
| Class R6 |
(20,752,703 | ) | 2,027,173 | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
29,313,965 | (62,755,845 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets |
81,631,929 | (8,067,209 | ) | |||||
|
|
||||||||
| Net assets:
|
||||||||
| Beginning of period |
723,244,072 | 731,311,281 | ||||||
|
|
||||||||
| End of period |
$ | 804,876,001 | $ | 723,244,072 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Asia Pacific Growth Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period |
Total return (b) |
Net assets, end of period (000’s omitted) |
Ratio
of |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed |
Ratio of net investment income (loss) to average net assets |
Portfolio turnover (c) |
|||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$36.20 | $(0.00) | $5.37 | $5.37 | $(0.10) | $(2.71) | $(2.81) | $38.76 | 15.12 | % | $495,596 | 1.39 | %(d) | 1.40 | %(d) | 0.01 | %(d) | 7 | % | |||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
33.15 | 0.13 | 5.12 | 5.25 | (0.35) | (1.85) | (2.20) | 36.20 | 16.67 | 438,473 | 1.44 | 1.45 | 0.40 | 27 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
30.30 | 0.35 | 4.60 | 4.95 | (0.34) | (1.76) | (2.10) | 33.15 | 17.17 | 433,120 | 1.43 | 1.44 | 1.08 | 17 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
36.95 | 0.36 | (4.21) | (3.85) | (0.28) | (2.52) | (2.80) | 30.30 | (11.39 | ) | 395,319 | 1.44 | 1.46 | 1.04 | 21 | |||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
31.60 | 0.28 | 5.69 | 5.97 | (0.30) | (0.32) | (0.62) | 36.95 | 19.32 | 495,214 | 1.45 | 1.47 | 0.85 | 18 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
29.35 | 0.31 | 2.83 | 3.14 | (0.89 | ) | – | (0.89 | ) | 31.60 | 11.15 | 467,191 | 1.45 | 1.47 | 1.06 | 9 | ||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
32.90 | (0.13 | ) | 4.87 | 4.74 | – | (2.71) | (2.71) | 34.93 | 14.70 | 19,649 | 2.14 | (d) | 2.15 | (d) | (0.74 | )(d) | 7 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
30.25 | (0.10 | ) | 4.65 | 4.55 | (0.05) | (1.85) | (1.90) | 32.90 | 15.78 | 23,167 | 2.19 | 2.20 | (0.35 | ) | 27 | ||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
27.77 | 0.10 | 4.21 | 4.31 | (0.07) | (1.76) | (1.83) | 30.25 | 16.29 | 31,409 | 2.18 | 2.19 | 0.33 | 17 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
34.08 | 0.09 | (3.86) | (3.77) | (0.02) | (2.52) | (2.54) | 27.77 | (12.05 | ) | 53,201 | 2.19 | 2.21 | 0.29 | 21 | |||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
29.17 | 0.03 | 5.27 | 5.30 | (0.07) | (0.32) | (0.39) | 34.08 | 18.44 | 70,146 | 2.20 | 2.22 | 0.10 | 18 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
27.10 | 0.08 | 2.63 | 2.71 | (0.64) | – | (0.64) | 29.17 | 10.34 | 72,872 | 2.20 | 2.22 | 0.31 | 9 | ||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
36.31 | 0.05 | 5.38 | 5.43 | (0.18) | (2.71) | (2.89) | 38.85 | 15.28 | 195,961 | 1.14 | (d) | 1.15 | (d) | 0.26 | (d) | 7 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
33.25 | 0.21 | 5.13 | 5.34 | (0.43) | (1.85) | (2.28) | 36.31 | 16.95 | 154,378 | 1.19 | 1.20 | 0.65 | 27 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
30.41 | 0.43 | 4.60 | 5.03 | (0.43) | (1.76) | (2.19) | 33.25 | 17.44 | 170,249 | 1.18 | 1.19 | 1.33 | 17 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
37.07 | 0.45 | (4.23) | (3.78) | (0.36) | (2.52) | (2.88) | 30.41 | (11.17 | ) | 172,297 | 1.19 | 1.21 | 1.29 | 21 | |||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
31.69 | 0.36 | 5.71 | 6.07 | (0.37) | (0.32) | (0.69) | 37.07 | 19.66 | 267,942 | 1.20 | 1.22 | 1.10 | 18 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
29.45 | 0.39 | 2.82 | 3.21 | (0.97) | – | (0.97) | 31.69 | 11.42 | 329,748 | 1.20 | 1.22 | 1.31 | 9 | ||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
36.32 | 0.08 | 5.39 | 5.47 | (0.25) | (2.71) | (2.96) | 38.83 | 15.39 | 93,669 | 0.98 | (d) | 0.99 | (d) | 0.42 | (d) | 7 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
33.27 | 0.28 | 5.12 | 5.40 | (0.50) | (1.85) | (2.35) | 36.32 | 17.16 | 107,226 | 0.99 | 1.00 | 0.85 | 27 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
30.43 | 0.49 | 4.61 | 5.10 | (0.50) | (1.76) | (2.26) | 33.27 | 17.70 | 96,533 | 0.98 | 0.99 | 1.53 | 17 | ||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
37.10 | 0.51 | (4.22) | (3.71) | (0.44) | (2.52) | (2.96) | 30.43 | (11.00 | ) | 87,386 | 1.01 | 1.03 | 1.47 | 21 | |||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/17(e) |
32.81 | 0.27 | 4.02 | 4.29 | – | – | – | 37.10 | 13.08 | 122,996 | 1.01 | (f) | 1.03 | (f) | 1.29 | (f) | 18 | |||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $497,867, $22,304, $189,597 and $104,030 for Class A, Class C, Class Y and Class R6 shares, respectively. |
| (e) | Commencement date of April 4, 2017. |
| (f) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Asia Pacific Growth Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Asia Pacific Growth Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of four different classes of shares: Class A, Class C, Class Y and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class Y and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services - Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
11 Invesco Asia Pacific Growth Fund
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date.
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R6 are charged to such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| J. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
12 Invesco Asia Pacific Growth Fund
forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| K. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets | Rate | |||
|
|
||||
| First $250 million |
0.935 | % | ||
|
|
||||
| Next $250 million |
0.910 | % | ||
|
|
||||
| Next $500 million |
0.885 | % | ||
|
|
||||
| Next $1.5 billion |
0.860 | % | ||
|
|
||||
| Next $2.5 billion |
0.835 | % | ||
|
|
||||
| Next $2.5 billion |
0.810 | % | ||
|
|
||||
| Next $2.5 billion |
0.785 | % | ||
|
|
||||
| Amount over $10 billion |
0.760 | % | ||
|
|
||||
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.91%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or reimbursement (excluding certain items discussed below) of Class A, Class C, Class Y and Class R6 shares to 2.25%, 3.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or reimbursement to exceed the numbers reflected above: (1) interest, facilities and maintenance fees; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waivers without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under this expense limit.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $22,946.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class Y and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A and Class C shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares and 1.00% of the average daily net assets of Class C shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $46,976 in front-end sales commissions from the sale of Class A shares and $201 and $368 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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
13 Invesco Asia Pacific Growth Fund
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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||
| Investments in Securities |
||||||||||||||
| Australia |
$ | – | $ | 10,997,614 | $ | – | $10,997,614 | |||||||
| China |
114,186,794 | 176,671,442 | – | 290,858,236 | ||||||||||
| Hong Kong |
– | 31,328,551 | – | 31,328,551 | ||||||||||
| India |
23,578,307 | 5,913,146 | – | 29,491,453 | ||||||||||
| Indonesia |
– | 58,273,169 | – | 58,273,169 | ||||||||||
| Macau |
– | 21,774,086 | – | 21,774,086 | ||||||||||
| Malaysia |
– | 19,360,633 | – | 19,360,633 | ||||||||||
| New Zealand |
– | 11,279,794 | – | 11,279,794 | ||||||||||
| Philippines |
– | 34,019,725 | – | 34,019,725 | ||||||||||
| Singapore |
– | 33,482,220 | – | 33,482,220 | ||||||||||
| South Korea |
– | 70,754,763 | – | 70,754,763 | ||||||||||
| Taiwan |
– | 50,934,108 | – | 50,934,108 | ||||||||||
| Thailand |
– | 15,890,235 | – | 15,890,235 | ||||||||||
| United States |
41,579,893 | 15,058,848 | – | 56,638,741 | ||||||||||
| Vietnam |
– | 17,600,077 | – | 17,600,077 | ||||||||||
| Money Market Funds |
52,443,729 | – | – | 52,443,729 | ||||||||||
| Total Investments |
$ | 231,788,723 | $573,338,411 | $ | – | $805,127,134 | ||||||||
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $866.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
14 Invesco Asia Pacific Growth Fund
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $54,630,425 and $67,684,958, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 318,787,836 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(5,884,615 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 312,903,221 | ||
|
|
||||
| Cost of investments for tax purposes is $492,223,913. |
||||
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
702,921 | $ | 27,788,927 | 937,686 | $ | 30,145,626 | ||||||||||
|
|
||||||||||||||||
| Class C |
89,815 | 3,245,553 | 82,500 | 2,426,842 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
810,068 | 31,708,453 | 1,400,491 | 43,505,433 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
82,985 | 3,222,950 | 297,210 | 9,691,972 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
825,110 | 30,834,363 | 807,939 | 25,926,744 | ||||||||||||
|
|
||||||||||||||||
| Class C |
51,722 | 1,746,651 | 58,740 | 1,724,616 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
282,750 | 10,580,517 | 291,878 | 9,375,121 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
204,038 | 7,626,943 | 192,554 | 6,175,199 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
175,978 | 6,693,757 | 118,184 | 3,920,812 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(194,818 | ) | (6,693,757 | ) | (129,652 | ) | (3,920,812 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(1,032,964 | ) | (40,713,716 | ) | (2,813,581 | ) | (88,289,687 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(88,420 | ) | (3,174,621 | ) | (345,611 | ) | (9,796,958 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(301,014 | ) | (11,949,459 | ) | (2,560,256 | ) | (79,800,755 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(826,683 | ) | (31,602,596 | ) | (439,230 | ) | (13,839,998 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
781,488 | $ | 29,313,965 | (2,101,148 | ) | $ | (62,755,845 | ) | ||||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 36% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
15 Invesco Asia Pacific Growth Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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.
| ACTUAL | HYPOTHETICAL (5% annual return before expenses) |
|||||||||||||||||||||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Expense Ratio | |||||||||||||||||||||||||
|
Class A |
$1,000.00 | $1,151.20 | $7.41 | $1,017.90 | $6.95 | 1.39 | % | |||||||||||||||||||||||
|
Class C |
1,000.00 | 1,147.00 | 11.39 | 1,014.18 | 10.69 | 2.14 | ||||||||||||||||||||||||
|
Class Y |
1,000.00 | 1,153.00 | 6.09 | 1,019.14 | 5.71 | 1.14 | ||||||||||||||||||||||||
|
Class R6 |
1,000.00 | 1,153.90 | 5.23 | 1,019.93 | 4.91 | 0.98 | ||||||||||||||||||||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
16 Invesco Asia Pacific Growth Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
| The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below. | ||
| A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov. | ||
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | APG-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders
|
April 30, 2021
| ||
|
Invesco European Growth Fund | ||||
|
Nasdaq: |
||||
| A: AEDAX ∎ C: AEDCX ∎ R: AEDRX ∎ Y: AEDYX ∎ Investor: EGINX ∎ R6: AEGSX | ||||
| 2 | Fund Performance | |||
| 4 | Liquidity Risk Management Program | |||
| 5 | Schedule of Investments | |||
| 8 | Financial Statements | |||
| 11 | Financial Highlights | |||
| 12 | Notes to Financial Statements | |||
| 18 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
|
Performance summary
|
| |||||
| Fund vs. Indexes |
| |||||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||||
| Class A Shares | 30.90 | % | ||||
| Class C Shares | 30.43 | |||||
| Class R Shares | 30.73 | |||||
| Class Y Shares | 31.07 | |||||
| Investor Class Shares | 30.98 | |||||
| Class R6 Shares | 31.16 | |||||
| MSCI Europe Indexq (Broad Market Index) | 33.32 | |||||
| MSCI Europe Growth Indexq (Style-Specific Index) | 26.41 | |||||
| Lipper European Funds Index∎ (Peer Group Index) | 34.47 | |||||
| Source(s): qRIMES Technologies Corp.; ∎Lipper Inc. |
| |||||
| The MSCI Europe Index is an unmanaged index considered representative of stocks of developed European countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||||
| The MSCI Europe Growth Index is an unmanaged index considered representative of European growth stocks. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||||
| The Lipper European Funds Index is an unmanaged index considered representative of European funds tracked by Lipper. |
| |||||
| The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||||
| A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
| |||||
|
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
|
2 Invesco European Growth Fund
3 Invesco European Growth Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; | |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; | |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; | |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and | |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco European Growth Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco European Growth Fund
Investment Abbreviations:
ADR – American Depositary Receipt
RSP – Registered Savings Plan Shares
Notes to Schedule of Investments:
| (a) | Non-income producing security. |
| (b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The value of this security at April 30, 2021 represented 1.12% of the Fund’s Net Assets. |
| (c) | All or a portion of this security was out on loan at April 30, 2021. |
| (d) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation (Depreciation) |
Realized Gain |
Value April 30, 2021 |
Dividend | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class | $ | 22,919,264 | $ | 33,297,973 | $ | (47,878,025) | $ | - | $ | - | $ | 8,339,212 | $ | 1,520 | |||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class | 20,309,891 | 23,784,266 | (34,198,587) | (6,158) | 5,968 | 9,895,380 | 3,446 | ||||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class | 26,193,444 | 38,054,826 | (54,717,742) | - | - | 9,530,528 | 802 | ||||||||||||||||||||||||||||
| Investments Purchased with Cash Collateral from Securities on Loan: | |||||||||||||||||||||||||||||||||||
| Invesco Private Government Fund | - | 29,663,731 | (15,949,501) | - | - | 13,714,230 | 185 | * | |||||||||||||||||||||||||||
| Invesco Private Prime Fund | - | 62,048,589 | (41,477,243) | - | - | 20,571,346 | 1,789 | * | |||||||||||||||||||||||||||
| Total | $ | 69,422,599 | $ | 186,849,385 | $ | (194,221,098) | $ | (6,158) | $ | 5,968 | $ | 62,050,696 | $ | 7,742 | |||||||||||||||||||||
| * | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
| (e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| (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 1I. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco European Growth Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Industrials |
33.43 | % | ||
| Financials |
17.85 | |||
| Consumer Discretionary |
10.45 | |||
| Health Care |
9.28 | |||
| Consumer Staples |
8.82 | |||
| Communication Services |
6.31 | |||
| Materials |
3.11 | |||
| Energy |
3.03 | |||
| Real Estate |
2.95 | |||
| Information Technology |
1.56 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
3.21 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco European Growth Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco European Growth Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $994,596) |
$ | 9,918,784 | ||
|
|
||||
| Dividends from affiliated money market funds (includes securities lending income of $16,510) |
22,278 | |||
|
|
||||
| Total investment income |
9,941,062 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
4,940,123 | |||
|
|
||||
| Administrative services fees |
76,473 | |||
|
|
||||
| Custodian fees |
84,134 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
419,885 | |||
|
|
||||
| Class C |
117,366 | |||
|
|
||||
| Class R |
17,502 | |||
|
|
||||
| Investor Class |
100,261 | |||
|
|
||||
| Transfer agent fees – A, C, R, Y and Investor |
830,088 | |||
|
|
||||
| Transfer agent fees – R6 |
1,249 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
22,150 | |||
|
|
||||
| Registration and filing fees |
51,675 | |||
|
|
||||
| Reports to shareholders |
33,916 | |||
|
|
||||
| Professional services fees |
48,001 | |||
|
|
||||
| Other |
35,830 | |||
|
|
||||
| Total expenses |
6,778,653 | |||
|
|
||||
| Less: Fees waived and/or expense offset arrangement(s) |
(21,480 | ) | ||
|
|
||||
| Net expenses |
6,757,173 | |||
|
|
||||
| Net investment income |
3,183,889 | |||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain from: |
||||
| Unaffiliated investment securities |
46,986,288 | |||
|
|
||||
| Affiliated investment securities |
5,968 | |||
|
|
||||
| Foreign currencies |
141,990 | |||
|
|
||||
| 47,134,246 | ||||
|
|
||||
| Change in net unrealized appreciation (depreciation) of: |
||||
| Unaffiliated investment securities |
238,048,975 | |||
|
|
||||
| Affiliated investment securities |
(6,158 | ) | ||
|
|
||||
| Foreign currencies |
(51,433 | ) | ||
|
|
||||
| 237,991,384 | ||||
|
|
||||
| Net realized and unrealized gain |
285,125,630 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 288,309,519 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco European Growth Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
| Operations: |
||||||||
| Net investment income |
$ | 3,183,889 | $ | 10,555,692 | ||||
|
|
||||||||
| Net realized gain (loss) |
47,134,246 | (14,539,601 | ) | |||||
|
|
||||||||
| Change in net unrealized appreciation (depreciation) |
237,991,384 | (132,311,706 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from operations |
288,309,519 | (136,295,615 | ) | |||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(4,332,934 | ) | (9,968,449 | ) | ||||
|
|
||||||||
| Class C |
(132,308 | ) | (650,979 | ) | ||||
|
|
||||||||
| Class R |
(71,734 | ) | (178,444 | ) | ||||
|
|
||||||||
| Class Y |
(9,434,694 | ) | (19,903,510 | ) | ||||
|
|
||||||||
| Investor Class |
(1,665,385 | ) | (3,532,061 | ) | ||||
|
|
||||||||
| Class R6 |
(160,084 | ) | (268,019 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(15,797,139 | ) | (34,501,462 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
(13,187,308 | ) | (48,369,989 | ) | ||||
|
|
||||||||
| Class C |
(5,293,396 | ) | (11,622,355 | ) | ||||
|
|
||||||||
| Class R |
(468,205 | ) | (678,098 | ) | ||||
|
|
||||||||
| Class Y |
(45,583,209 | ) | (79,494,966 | ) | ||||
|
|
||||||||
| Investor Class |
(5,426,818 | ) | (11,699,480 | ) | ||||
|
|
||||||||
| Class R6 |
(4,083,979 | ) | 1,231,154 | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
(74,042,915 | ) | (150,633,734 | ) | ||||
|
|
||||||||
| Net increase (decrease) in net assets |
198,469,465 | (321,430,811 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
953,547,130 | 1,274,977,941 | ||||||
|
|
||||||||
| End of period |
$ | 1,152,016,595 | $ | 953,547,130 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco European Growth Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period |
Total return (b) |
Net assets, end of period (000’s omitted) |
Ratio of to average net
assets |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed |
Ratio of net investment income (loss) to average net assets |
Portfolio turnover (c) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$33.73 | $ | 0.09 | $ | 10.27 | $ | 10.36 | $ | (0.51 | ) | $ | – | $ | (0.51 | ) | $ | 43.58 | 30.90 | % | $ | 357,887 | 1.36 | %(d) | 1.36 | %(d) | 0.45 | %(d) | 9 | % | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
38.76 | 0.30 | (4.31 | ) | (4.01 | ) | (1.02 | ) | – | (1.02 | ) | 33.73 | (10.74 | ) | 287,960 | 1.36 | 1.37 | 0.84 | 27 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
35.55 | 0.74 | 2.94 | 3.68 | (0.47 | ) | – | (0.47 | ) | 38.76 | 10.57 | 386,369 | 1.35 | 1.36 | 2.02 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
40.95 | 0.58 | (5.21 | ) | (4.63 | ) | (0.77 | ) | – | (0.77 | ) | 35.55 | (11.54 | ) | 402,331 | 1.34 | 1.35 | 1.45 | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
32.88 | 0.48 | 8.12 | 8.60 | (0.53 | ) | – | (0.53 | ) | 40.95 | 26.53 | 506,795 | 1.38 | 1.39 | 1.32 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
36.65 | 0.50 | (2.61 | ) | (2.11 | ) | (0.51 | ) | (1.15 | ) | (1.66 | ) | 32.88 | (5.94 | ) | 453,114 | 1.34 | 1.36 | 1.47 | 16 | |||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
31.31 | (0.06 | ) | 9.57 | 9.51 | (0.20 | ) | – | (0.20 | ) | 40.62 | 30.43 | 23,003 | 2.11 | (d) | 2.11 | (d) | (0.30 | )(d) | 9 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
35.97 | 0.03 | (4.04 | ) | (4.01 | ) | (0.65 | ) | – | (0.65 | ) | 31.31 | (11.43 | ) | 22,166 | 2.11 | 2.12 | 0.09 | 27 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
32.94 | 0.43 | 2.75 | 3.18 | (0.15 | ) | – | (0.15 | ) | 35.97 | 9.72 | 38,236 | 2.10 | 2.11 | 1.27 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
38.01 | 0.26 | (4.82 | ) | (4.56 | ) | (0.51 | ) | – | (0.51 | ) | 32.94 | (12.18 | ) | 71,859 | 2.09 | 2.10 | 0.70 | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
30.50 | 0.19 | 7.56 | 7.75 | (0.24 | ) | – | (0.24 | ) | 38.01 | 25.58 | 90,488 | 2.13 | 2.14 | 0.57 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
34.12 | 0.22 | (2.42 | ) | (2.20 | ) | (0.27 | ) | (1.15 | ) | (1.42 | ) | 30.50 | (6.63 | ) | 86,303 | 2.09 | 2.11 | 0.72 | 16 | |||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
33.59 | 0.04 | 10.25 | 10.29 | (0.41 | ) | – | (0.41 | ) | 43.47 | 30.77 | 7,363 | 1.61 | (d) | 1.61 | (d) | 0.20 | (d) | 9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
38.59 | 0.21 | (4.32 | ) | (4.11 | ) | (0.89 | ) | – | (0.89 | ) | 33.59 | (10.98 | ) | 6,092 | 1.61 | 1.62 | 0.59 | 27 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
35.38 | 0.64 | 2.93 | 3.57 | (0.36 | ) | – | (0.36 | ) | 38.59 | 10.26 | 7,803 | 1.60 | 1.61 | 1.77 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
40.76 | 0.48 | (5.18 | ) | (4.70 | ) | (0.68 | ) | – | (0.68 | ) | 35.38 | (11.74 | ) | 10,795 | 1.59 | 1.60 | 1.20 | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
32.71 | 0.39 | 8.09 | 8.48 | (0.43 | ) | – | (0.43 | ) | 40.76 | 26.24 | 13,655 | 1.63 | 1.64 | 1.07 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
36.48 | 0.41 | (2.60 | ) | (2.19 | ) | (0.43 | ) | (1.15 | ) | (1.58 | ) | 32.71 | (6.19 | ) | 12,893 | 1.59 | 1.61 | 1.22 | 16 | |||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
33.81 | 0.14 | 10.29 | 10.43 | (0.61 | ) | – | (0.61 | ) | 43.63 | 31.07 | 628,952 | 1.11 | (d) | 1.11 | (d) | 0.70 | (d) | 9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
38.85 | 0.39 | (4.31 | ) | (3.92 | ) | (1.12 | ) | – | (1.12 | ) | 33.81 | (10.51 | ) | 524,899 | 1.11 | 1.12 | 1.09 | 27 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
35.67 | 0.83 | 2.93 | 3.76 | (0.58 | ) | – | (0.58 | ) | 38.85 | 10.81 | 700,808 | 1.10 | 1.11 | 2.27 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
41.06 | 0.68 | (5.21 | ) | (4.53 | ) | (0.86 | ) | – | (0.86 | ) | 35.67 | (11.29 | ) | 820,248 | 1.09 | 1.10 | 1.70 | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
32.98 | 0.58 | 8.13 | 8.71 | (0.63 | ) | – | (0.63 | ) | 41.06 | 26.85 | 911,498 | 1.13 | 1.14 | 1.57 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
36.76 | 0.58 | (2.62 | ) | (2.04 | ) | (0.59 | ) | (1.15 | ) | (1.74 | ) | 32.98 | (5.71 | ) | 696,907 | 1.09 | 1.11 | 1.72 | 16 | |||||||||||||||||||||||||||||||||||||||||||||||
| Investor Class |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
33.65 | 0.11 | 10.25 | 10.36 | (0.55 | ) | – | (0.55 | ) | 43.46 | 30.98 | (e) | 128,388 | 1.28 | (d)(e) | 1.28 | (d)(e) | 0.53 | (d)(e) | 9 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
38.67 | 0.33 | (4.31 | ) | (3.98 | ) | (1.04 | ) | – | (1.04 | ) | 33.65 | (10.68 | )(e) | 103,954 | 1.27 | (e) | 1.28 | (e) | 0.93 | (e) | 27 | |||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
35.48 | 0.76 | 2.93 | 3.69 | (0.50 | ) | – | (0.50 | ) | 38.67 | 10.61 | (e) | 133,149 | 1.29 | (e) | 1.30 | (e) | 2.08 | (e) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
40.86 | 0.60 | (5.19 | ) | (4.59 | ) | (0.79 | ) | – | (0.79 | ) | 35.48 | (11.47 | )(e) | 133,359 | 1.29 | (e) | 1.30 | (e) | 1.50 | (e) | 16 | |||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
32.80 | 0.50 | 8.10 | 8.60 | (0.54 | ) | – | (0.54 | ) | 40.86 | 26.61 | (e) | 166,324 | 1.32 | (e) | 1.33 | (e) | 1.38 | (e) | 22 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
36.56 | 0.51 | (2.61 | ) | (2.10 | ) | (0.51 | ) | (1.15 | ) | (1.66 | ) | 32.80 | (5.91 | )(e) | 147,804 | 1.31 | (e) | 1.33 | (e) | 1.50 | (e) | 16 | ||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
33.81 | 0.16 | 10.30 | 10.46 | (0.66 | ) | – | (0.66 | ) | 43.61 | 31.16 | 6,424 | 0.99 | (d) | 0.99 | (d) | 0.82 | (d) | 9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
38.86 | 0.43 | (4.32 | ) | (3.89 | ) | (1.16 | ) | – | (1.16 | ) | 33.81 | (10.43 | ) | 8,477 | 0.99 | 1.00 | 1.21 | 27 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
35.68 | 0.87 | 2.94 | 3.81 | (0.63 | ) | – | (0.63 | ) | 38.86 | 10.96 | 8,613 | 0.98 | 0.99 | 2.39 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
41.09 | 0.72 | (5.21 | ) | (4.49 | ) | (0.92 | ) | – | (0.92 | ) | 35.68 | (11.20 | ) | 9,925 | 0.99 | 1.00 | 1.80 | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/17(f) |
35.50 | 0.40 | 5.19 | 5.59 | – | – | – | 41.09 | 15.75 | 4,723 | 0.96 | (g) | 0.97 | (g) | 1.74 | (g) | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $338,692, $23,668, $7,059, $608,702 , $121,548 and $7,847 for Class A, Class C, Class R, Class Y, Investor Class and Class R6 shares, respectively. |
| (e) | The total return, ratio of expenses to average net assets and ratio of net investment income to average net assets reflect actual 12b-1 fees of 0.17%, 0.16%, 0.19%, 0.20%, 0.19% and 0.22% for six months ended April 30, 2021 and for each of the years ended October 31, 2020, 2019, 2018, 2017 and 2016, respectively. |
| (f) | Commencement date of April 4, 2017. |
| (g) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco European Growth Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco European Growth Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Investor Class and Class R6. Class Y and Investor Class shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Investor Class and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 Invesco European Growth Fund
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date.
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R6 are charged to such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy 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. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the 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. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. 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. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The 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 Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
| J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 Invesco European Growth Fund
| foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| L. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets | Rate | |||
| First $250 million |
0.935% | |||
| Next $250 million |
0.910% | |||
| Next $500 million |
0.885% | |||
| Next $1.5 billion |
0.860% | |||
| Next $2.5 billion |
0.835% | |||
| Next $2.5 billion |
0.810% | |||
| Next $2.5 billion |
0.785% | |||
| Over $10 billion |
0.760% | |||
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.90%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Investor Class and Class R6 shares to 2.25%, 3.00%, 2.50%, 2.00%, 2.25% and 2.00%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or reimbursement to exceed the numbers reflected above: (1) interest, facilities and maintenance fees; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waivers without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under this expense limit.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $20,355.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
14 Invesco European Growth Fund
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Investor Class and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C, Class R, Investor Class shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The Fund, pursuant to the Investor Class Plan, reimburses IDI for its allocated share of expenses incurred pursuant to the Investor Class Plan for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Investor Class shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $12,148 in front-end sales commissions from the sale of Class A shares and $1,088 and $169 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $391 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Investments in Securities |
||||||||||||||||
| Denmark |
$ | – | $ | 29,339,442 | $– | $ | 29,339,442 | |||||||||
| France |
18,405,359 | 128,093,904 | – | 146,499,263 | ||||||||||||
| Germany |
– | 80,065,656 | – | 80,065,656 | ||||||||||||
| Hungary |
– | 18,784,512 | – | 18,784,512 | ||||||||||||
| Ireland |
12,928,702 | 52,309,196 | – | 65,237,898 | ||||||||||||
| Italy |
– | 67,122,454 | – | 67,122,454 | ||||||||||||
| Netherlands |
– | 116,124,592 | – | 116,124,592 | ||||||||||||
| Norway |
– | 14,973,259 | – | 14,973,259 | ||||||||||||
| Russia |
– | 65,900,474 | – | 65,900,474 | ||||||||||||
| Spain |
– | 11,873,337 | – | 11,873,337 | ||||||||||||
| Sweden |
– | 70,486,953 | – | 70,486,953 | ||||||||||||
| Switzerland |
– | 90,582,152 | – | 90,582,152 | ||||||||||||
| Turkey |
– | 10,465,970 | – | 10,465,970 | ||||||||||||
| United Kingdom |
20,844,339 | 279,943,126 | – | 300,787,465 | ||||||||||||
| United States |
26,767,200 | – | – | 26,767,200 | ||||||||||||
| Money Market Funds |
27,765,120 | 34,285,576 | – | 62,050,696 | ||||||||||||
| Total Investments |
$ | 106,710,720 | $ | 1,070,350,603 | $– | $ | 1,177,061,323 | |||||||||
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $1,125.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under
15 Invesco European Growth Fund
such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2020, as follows:
| Capital Loss Carryforward* | |||||||||||||||
| Expiration | Short-Term | Long-Term | Total | ||||||||||||
| Not subject to expiration |
$ | 17,898,324 | $ | 1,832,287 | $ | 19,730,611 | |||||||||
| * | Capital loss carryforward 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
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $95,168,569 and $144,357,235, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 407,410,882 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(25,857,478 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 381,553,404 | ||
|
|
||||
Cost of investments for tax purposes is $795,507,919.
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
250,659 | $ | 10,144,357 | 530,820 | $ | 18,920,411 | ||||||||||
|
|
||||||||||||||||
| Class C |
23,251 | 888,247 | 46,143 | 1,507,318 | ||||||||||||
|
|
||||||||||||||||
| Class R |
14,264 | 573,513 | 30,865 | 1,080,156 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
872,820 | 35,239,968 | 4,385,537 | 147,163,758 | ||||||||||||
|
|
||||||||||||||||
| Investor Class |
39,370 | 1,600,835 | 45,833 | 1,620,704 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
14,423 | 586,693 | 133,117 | 4,834,990 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
97,439 | 3,811,815 | 220,799 | 8,713,438 | ||||||||||||
|
|
||||||||||||||||
| Class C |
2,977 | 108,822 | 14,787 | 545,333 | ||||||||||||
|
|
||||||||||||||||
| Class R |
1,825 | 71,265 | 4,499 | 177,209 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
204,943 | 8,017,382 | 416,542 | 16,440,918 | ||||||||||||
|
|
||||||||||||||||
| Investor Class |
38,415 | 1,498,177 | 81,165 | 3,193,834 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
4,018 | 157,063 | 6,621 | 261,078 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
73,448 | 2,967,702 | 86,439 | 3,132,991 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(78,696 | ) | (2,967,702 | ) | (92,835 | ) | (3,132,991 | ) | ||||||||
|
|
||||||||||||||||
16 Invesco European Growth Fund
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(747,356 | ) | $ | (30,111,182 | ) | (2,268,059 | ) | $ | (79,136,829 | ) | ||||||
|
|
||||||||||||||||
| Class C |
(89,148 | ) | (3,322,763 | ) | (323,151 | ) | (10,542,015 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(28,041 | ) | (1,112,983 | ) | (56,231 | ) | (1,935,463 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(2,187,771 | ) | (88,840,559 | ) | (7,313,281 | ) | (243,099,642 | ) | ||||||||
|
|
||||||||||||||||
| Investor Class |
(212,686 | ) | (8,525,830 | ) | (481,353 | ) | (16,514,018 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(121,851 | ) | (4,827,735 | ) | (110,664 | ) | (3,864,914 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
(1,827,697 | ) | $ | (74,042,915 | ) | (4,642,407 | ) | $ | (150,633,734 | ) | ||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 54% of the outstanding shares of the Fund. The Fund and the Fund’s principal underwriter or adviser, are parties to participation agreements with these entities whereby these entities sell units of interest in separate accounts funding variable products that are invested in the Fund. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as, securities brokerage, third party record keeping and account servicing and administrative services. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
17 Invesco European Growth Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL (5% annual return
before |
|||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Ratio | |||||||
|
Class A |
$1,000.00 | $1,309.00 | $7.79 | $1,018.05 | $6.80 | 1.36% | ||||||
|
Class C |
1,000.00 | 1,304.30 | 12.06 | 1,014.33 | 10.54 | 2.11 | ||||||
|
Class R |
1,000.00 | 1,307.30 | 9.21 | 1,016.81 | 8.05 | 1.61 | ||||||
|
Class Y |
1,000.00 | 1,310.70 | 6.36 | 1,019.29 | 5.56 | 1.11 | ||||||
|
Investor Class |
1,000.00 | 1,309.80 | 7.33 | 1,018.45 | 6.41 | 1.28 | ||||||
|
Class R6 |
1,000.00 | 1,311.60 | 5.67 | 1,019.89 | 4.96 | 0.99 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
18 Invesco European Growth Fund
(This page intentionally left blank)
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | EGR-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders
|
April 30, 2021 | ||
|
| ||||
| Invesco Global Fund
| ||||
| Nasdaq: | ||||
| A: OPPAX ∎ C: OGLCX ∎ R: OGLNX ∎ Y: OGLYX ∎ R5: GFDDX ∎ R6: OGLIX | ||||
| 2
|
| |||
| 4
|
Liquidity Risk Management Program
| |||
| 5
|
| |||
| 7
|
| |||
| 10
|
| |||
| 11
|
| |||
| 16
|
| |||
| For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
| NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE | ||||
2 Invesco Global Fund
3 Invesco Global Fund
Liquidity Risk Management Program
| In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco. |
| As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets. |
| At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period. |
| The Report stated, in relevant part, that during the Program Reporting Period: |
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Global Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Global Fund
Investment Abbreviations:
ADR – American Depositary Receipt
Pfd. – Preferred
Notes to Schedule of Investments:
| (a) | Affiliated issuer. The issuer is affiliated by having an investment adviser that is under common control of Invesco Ltd. and/or the Investment Company Act of 1940, as amended (the “1940 Act”), defines “affiliated person” to include an issuer of which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation (Depreciation) |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: |
|||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ | 4,269,509 | $ | 195,657,465 | $ | (196,884,073 | ) | $ | - | $ | - | $ | 3,042,901 | $ | 1,090 | ||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
3,048,843 | 139,755,332 | (140,424,733 | ) | 192 | (216 | ) | 2,379,418 | 1,237 | ||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
4,879,438 | 223,608,531 | (225,010,367 | ) | - | - | 3,477,602 | 511 | |||||||||||||||||||||||||||
| Investments in Other Affiliates: |
|||||||||||||||||||||||||||||||||||
| Reservas de Maternidad - Swiss Medical |
36,663,663 | - | - | (5,965,606 | ) | - | 30,698,057 | - | |||||||||||||||||||||||||||
| Total |
$ | 48,861,453 | $ | 559,021,328 | $ | (562,319,173 | ) | $ | (5,965,414 | ) | $ | (216 | ) | $ | 39,597,978 | $ | 2,838 | ||||||||||||||||||
| (b) | Security valued using significant unobservable inputs (Level 3). See Note 3. |
| (c) | Non-income producing security. |
| (d) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The value of this security at April 30, 2021 represented less than 1% of the Fund’s Net Assets. |
| (e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Information Technology |
30.25 | % | ||
| Communication Services |
19.84 | |||
| Consumer Discretionary |
16.35 | |||
| Industrials |
14.83 | |||
| Health Care |
9.26 | |||
| Financials |
7.15 | |||
| Other Sectors, Each Less than 2% of Net Assets |
2.19 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
0.13 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Global Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Global Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $3,653,610) |
$ | 35,288,285 | ||
|
|
||||
| Dividends from affiliates |
2,838 | |||
|
|
||||
| Total investment income |
35,291,123 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
39,338,354 | |||
|
|
||||
| Administrative services fees |
902,026 | |||
|
|
||||
| Custodian fees |
231,746 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
8,399,428 | |||
|
|
||||
| Class C |
1,269,016 | |||
|
|
||||
| Class R |
570,080 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
7,604,054 | |||
|
|
||||
| Transfer agent fees – R6 |
70,664 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
143,280 | |||
|
|
||||
| Registration and filing fees |
85,134 | |||
|
|
||||
| Reports to shareholders |
343,652 | |||
|
|
||||
| Professional services fees |
90,118 | |||
|
|
||||
| Other |
214,231 | |||
|
|
||||
| Total expenses |
59,261,783 | |||
|
|
||||
| Less: Fees waived and/or expense offset arrangement(s) |
(19,799 | ) | ||
|
|
||||
| Net expenses |
59,241,984 | |||
|
|
||||
| Net investment income (loss) |
(23,950,861 | ) | ||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
412,086,565 | |||
|
|
||||
| Affiliated investment securities |
(216 | ) | ||
|
|
||||
| Foreign currencies |
109,336 | |||
|
|
||||
| 412,195,685 | ||||
|
|
||||
| Change in net unrealized appreciation (depreciation) of: |
||||
| Unaffiliated investment securities (net of foreign taxes of $366,265) |
2,654,429,133 | |||
|
|
||||
| Affiliated investment securities |
(5,965,414 | ) | ||
|
|
||||
| Foreign currencies |
54,963 | |||
|
|
||||
| 2,648,518,682 | ||||
|
|
||||
| Net realized and unrealized gain |
3,060,714,367 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 3,036,763,506 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Global Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income (loss) |
$ | (23,950,861 | ) | $ | (16,019,844 | ) | ||
|
|
||||||||
| Net realized gain |
412,195,685 | 694,147,295 | ||||||
|
|
||||||||
| Change in net unrealized appreciation |
2,648,518,682 | 713,539,849 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
3,036,763,506 | 1,391,667,300 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(401,495,954 | ) | (88,267,939 | ) | ||||
|
|
||||||||
| Class C |
(17,266,924 | ) | (4,268,191 | ) | ||||
|
|
||||||||
| Class R |
(12,789,747 | ) | (2,930,684 | ) | ||||
|
|
||||||||
| Class Y |
(135,222,108 | ) | (28,337,555 | ) | ||||
|
|
||||||||
| Class R5 |
(780 | ) | (153 | ) | ||||
|
|
||||||||
| Class R6 |
(125,000,218 | ) | (26,220,136 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(691,775,731 | ) | (150,024,658 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
98,642,235 | (711,388,987 | ) | |||||
|
|
||||||||
| Class C |
(42,745,107 | ) | (56,798,927 | ) | ||||
|
|
||||||||
| Class R |
(1,022,694 | ) | (35,630,303 | ) | ||||
|
|
||||||||
| Class Y |
9,743,315 | (124,020,139 | ) | |||||
|
|
||||||||
| Class R6 |
169,659,767 | (360,415,404 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
234,277,516 | (1,288,253,760 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets |
2,579,265,291 | (46,611,118 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
10,724,706,944 | 10,771,318,062 | ||||||
|
|
||||||||
| End of period |
$ | 13,303,972,235 | $ | 10,724,706,944 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Global Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income |
Net
gains realized and |
Total
from operations |
Dividends investment income |
Distributions from net realized |
Total distributions |
Net
asset of period |
Total return(b) |
Net assets, (000’s omitted) |
Ratio
of net
assets |
Ratio
of fee
waivers |
Ratio of net investment to average |
Portfolio turnover (d) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 101.84 | $ | (0.28 | ) | $ | 28.66 | $ | 28.38 | $ | - | $ | (6.61 | ) | $ | (6.61 | ) | $ | 123.61 | 28.55 | % | $ | 7,717,394 | 1.04 | %(e) | 1.04 | %(e) | (0.48 | )%(e) | 4 | % | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
90.42 | (0.23 | ) | 12.95 | 12.72 | (0.51 | ) | (0.79 | ) | (1.30 | ) | 101.84 | 14.17 | 6,256,292 | 1.06 | 1.06 | (0.25 | ) | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
86.02 | (0.02 | ) | 4.42 | 4.40 | - | - | - | 90.42 | 5.11 | 6,250,324 | 1.06 | (f) | 1.06 | (f) | (0.23 | )(f) | 1 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
98.63 | 0.42 | (3.48 | ) | (3.06 | ) | (0.40 | ) | (9.15 | ) | (9.55 | ) | 86.02 | (2.09 | ) | 6,026,243 | 1.09 | 1.09 | 0.49 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
95.03 | 0.38 | 8.90 | 9.28 | (0.53 | ) | (5.15 | ) | (5.68 | ) | 98.63 | 10.08 | 6,759,414 | 1.10 | 1.10 | 0.38 | 14 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
75.13 | 0.31 | 20.11 | 20.42 | (0.52 | ) | - | (0.52 | ) | 95.03 | 27.36 | 7,004,011 | 1.12 | 1.13 | 0.37 | 7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
74.79 | 0.47 | 3.75 | 4.22 | (0.52 | ) | (3.36 | ) | (3.88 | ) | 75.13 | 5.62 | 6,391,711 | 1.13 | 1.13 | 0.64 | 6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
91.23 | (0.64 | ) | 25.58 | 24.94 | - | (6.61 | ) | (6.61 | ) | 109.56 | 28.08 | 247,459 | 1.81 | (e) | 1.81 | (e) | (1.25 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
81.75 | (0.85 | ) | 11.63 | 10.78 | (0.51 | ) | (0.79 | ) | (1.30 | ) | 91.23 | 13.28 | 243,600 | 1.83 | 1.83 | (1.02 | ) | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
77.82 | (0.07 | ) | 4.00 | 3.93 | - | - | - | 81.75 | 5.05 | 274,378 | 1.82 | (f) | 1.82 | (f) | (0.99 | )(f) | 1 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
90.43 | (0.22 | ) | (3.24 | ) | (3.46 | ) | - | (9.15 | ) | (9.15 | ) | 77.82 | (2.85 | ) | 267,208 | 1.86 | 1.86 | (0.28 | ) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
87.71 | (0.34 | ) | 8.21 | 7.87 | - | (5.15 | ) | (5.15 | ) | 90.43 | 9.24 | 646,353 | 1.86 | 1.86 | (0.38 | ) | 14 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
69.39 | (0.30 | ) | 18.62 | 18.32 | - | - | - | 87.71 | 26.40 | 647,114 | 1.88 | 1.89 | (0.40 | ) | 7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
69.37 | (0.08 | ) | 3.46 | 3.38 | - | (3.36 | ) | (3.36 | ) | 69.39 | 4.80 | 626,045 | 1.90 | 1.90 | (0.12 | ) | 6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
100.86 | (0.43 | ) | 28.37 | 27.94 | - | (6.61 | ) | (6.61 | ) | 122.19 | 28.40 | 238,331 | 1.31 | (e) | 1.31 | (e) | (0.75 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
89.81 | (0.48 | ) | 12.83 | 12.35 | (0.51 | ) | (0.79 | ) | (1.30 | ) | 100.86 | 13.85 | 197,067 | 1.33 | 1.33 | (0.52 | ) | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
85.46 | (0.04 | ) | 4.39 | 4.35 | - | - | - | 89.81 | 5.09 | 209,838 | 1.32 | (f) | 1.32 | (f) | (0.49 | )(f) | 1 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
98.01 | 0.19 | (3.44 | ) | (3.25 | ) | (0.15 | ) | (9.15 | ) | (9.30 | ) | 85.46 | (2.35 | ) | 202,819 | 1.35 | 1.35 | 0.22 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
94.48 | 0.12 | 8.86 | 8.98 | (0.30 | ) | (5.15 | ) | (5.45 | ) | 98.01 | 9.79 | 237,458 | 1.36 | 1.36 | 0.12 | 14 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
74.69 | 0.09 | 20.02 | 20.11 | (0.32 | ) | - | (0.32 | ) | 94.48 | 27.04 | 226,446 | 1.38 | 1.39 | 0.11 | 7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
74.35 | 0.28 | 3.72 | 4.00 | (0.30 | ) | (3.36 | ) | (3.66 | ) | 74.69 | 5.33 | 210,141 | 1.39 | 1.39 | 0.39 | 6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
102.29 | (0.14 | ) | 28.79 | 28.65 | - | (6.61 | ) | (6.61 | ) | 124.33 | 28.69 | 2,559,813 | 0.81 | (e) | 0.81 | (e) | (0.25 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
90.61 | (0.01 | ) | 12.99 | 12.98 | (0.51 | ) | (0.79 | ) | (1.30 | ) | 102.29 | 14.42 | 2,093,441 | 0.83 | 0.83 | (0.02 | ) | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
86.18 | 0.00 | 4.43 | 4.43 | - | - | - | 90.61 | 5.14 | 1,985,139 | 0.82 | (f) | 0.82 | (f) | 0.00 | (f) | 1 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
98.88 | 0.62 | (3.51 | ) | (2.89 | ) | (0.66 | ) | (9.15 | ) | (9.81 | ) | 86.18 | (1.88 | ) | 1,899,009 | 0.86 | 0.86 | 0.72 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
95.27 | 0.61 | 8.92 | 9.53 | (0.77 | ) | (5.15 | ) | (5.92 | ) | 98.88 | 10.33 | 2,158,393 | 0.87 | 0.87 | 0.62 | 14 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
75.32 | 0.49 | 20.16 | 20.65 | (0.70 | ) | - | (0.70 | ) | 95.27 | 27.66 | 1,589,161 | 0.88 | 0.89 | 0.59 | 7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
75.00 | 0.65 | 3.76 | 4.41 | (0.73 | ) | (3.36 | ) | (4.09 | ) | 75.32 | 5.87 | 1,182,183 | 0.90 | 0.90 | 0.90 | 6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
102.39 | (0.06 | ) | 28.83 | 28.77 | - | (6.61 | ) | (6.61 | ) | 124.55 | 28.80 | 15 | 0.67 | (e) | 0.67 | (e) | (0.11 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
90.55 | 0.14 | 13.00 | 13.14 | (0.51 | ) | (0.79 | ) | (1.30 | ) | 102.39 | 14.62 | 12 | 0.68 | 0.68 | 0.13 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
86.12 | 0.01 | 4.42 | 4.43 | - | - | - | 90.55 | 5.15 | 11 | 0.66 | (f) | 0.66 | (f) | 0.17 | (f) | 1 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 09/30/19(g) |
84.75 | 0.26 | 1.11 | 1.37 | - | - | - | 86.12 | 1.61 | 10 | 0.75 | (f) | 0.75 | (f) | 0.83 | (f) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
102.54 | (0.06 | ) | 28.87 | 28.81 | - | (6.61 | ) | (6.61 | ) | 124.74 | 28.78 | 2,540,960 | 0.67 | (e) | 0.67 | (e) | (0.11 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
90.69 | 0.13 | 13.02 | 13.15 | (0.51 | ) | (0.79 | ) | (1.30 | ) | 102.54 | 14.61 | 1,934,295 | 0.68 | 0.68 | 0.13 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
86.25 | 0.01 | 4.43 | 4.44 | - | - | - | 90.69 | 5.15 | 2,051,628 | 0.67 | (f) | 0.67 | (f) | 0.16 | (f) | 1 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
98.97 | 0.76 | (3.51 | ) | (2.75 | ) | (0.82 | ) | (9.15 | ) | (9.97 | ) | 86.25 | (1.70 | ) | 1,957,302 | 0.69 | 0.69 | 0.88 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
95.35 | 0.77 | 8.92 | 9.69 | (0.92 | ) | (5.15 | ) | (6.07 | ) | 98.97 | 10.52 | 1,436,651 | 0.69 | 0.69 | 0.78 | 14 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
75.40 | 0.70 | 20.10 | 20.80 | (0.85 | ) | - | (0.85 | ) | 95.35 | 27.91 | 1,005,841 | 0.70 | 0.70 | 0.84 | 7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
75.07 | 0.80 | 3.77 | 4.57 | (0.88 | ) | (3.36 | ) | (4.24 | ) | 75.40 | 6.05 | 663,292 | 0.71 | 0.71 | 1.11 | 6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Does not include estimated acquired fund fees from underlying funds of 0.00% for the one month ended October 31, 2019 and the years ended September 30, 2019, 2018, 2017 and 2016, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $7,354,806, $255,907, $229,922, $2,440,945, $14 and $2,360,257 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (f) | Annualized. |
| (g) | Commencement date after the close of business on May 24, 2019. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Global Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Global Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
11 Invesco Global Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| J. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
12 Invesco Global Fund
forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| K. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets* | Rate | |||
|
|
||||
| Up to $250 million |
0.800% | |||
|
|
||||
| Next $250 million |
0.770% | |||
|
|
||||
| Next $500 million |
0.750% | |||
|
|
||||
| Next $1 billion |
0.690% | |||
|
|
||||
| Next $1.5 billion |
0.670% | |||
|
|
||||
| Next $2.5 billion |
0.650% | |||
|
|
||||
| Next $2.5 billion |
0.630% | |||
|
|
||||
| Next $2.5 billion |
0.600% | |||
|
|
||||
| Next $4 billion |
0.580% | |||
|
|
||||
| Next $8 billion |
0.560% | |||
|
|
||||
| Over $23 billion |
0.540% | |||
|
|
||||
| * | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.63%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through May 31, 2021, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.15%, 1.89%, 1.39%, 0.89%, 0.75% and 0.70%, respectively, of the Fund’s average daily net assets (the “expense limits”). Effective June 1, 2021 through at least June 30, 2022, the Adviser has agreed to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.25%, 3.00%, 2.50%, 2.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $9,956.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
13 Invesco Global Fund
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $180,446 in front-end sales commissions from the sale of Class A shares and $8,136 and $3,986 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—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.
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||
| Investments in Securities |
||||||||||||||||||||||||||||
| Argentina |
$ | – | $ | – | $ | 30,698,057 | $ | 30,698,057 | ||||||||||||||||||||
| Brazil |
110,733,297 | – | – | 110,733,297 | ||||||||||||||||||||||||
| China |
476,652,092 | 52,718,517 | – | 529,370,609 | ||||||||||||||||||||||||
| Denmark |
7,524,233 | 45,276,347 | – | 52,800,580 | ||||||||||||||||||||||||
| France |
– | 1,526,488,417 | – | 1,526,488,417 | ||||||||||||||||||||||||
| Germany |
– | 338,275,662 | – | 338,275,662 | ||||||||||||||||||||||||
| India |
194,433,835 | 234,651,530 | – | 429,085,365 | ||||||||||||||||||||||||
| Italy |
– | 39,417,827 | – | 39,417,827 | ||||||||||||||||||||||||
| Japan |
– | 1,830,980,803 | – | 1,830,980,803 | ||||||||||||||||||||||||
| Netherlands |
33,299,349 | 82,740,066 | – | 116,039,415 | ||||||||||||||||||||||||
| Spain |
– | 171,698,585 | – | 171,698,585 | ||||||||||||||||||||||||
| Sweden |
– | 424,941,928 | – | 424,941,928 | ||||||||||||||||||||||||
| Switzerland |
– | 57,527,806 | – | 57,527,806 | ||||||||||||||||||||||||
| United Kingdom |
179,910,680 | 163,662,654 | – | 343,573,334 | ||||||||||||||||||||||||
| United States |
7,284,974,762 | – | – | 7,284,974,762 | ||||||||||||||||||||||||
| Money Market Funds |
8,899,921 | – | – | 8,899,921 | ||||||||||||||||||||||||
| Total Investments |
$ | 8,296,428,169 | $ | 4,968,380,142 | $ | 30,698,057 | $ | 13,295,506,368 | ||||||||||||||||||||
NOTE 4—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $9,843.
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
14 Invesco Global Fund
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $445,194,077 and $903,202,802, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
|
|
||||
| Aggregate unrealized appreciation of investments |
$8,926,143,365 | |||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(9,370,257 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$8,916,773,108 | |||
|
|
||||
Cost of investments for tax purposes is $4,378,733,260.
NOTE 9—Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
2,317,021 | $ | 271,381,534 | 3,782,735 | $ | 350,384,952 | ||||||||||
|
|
||||||||||||||||
| Class C |
128,324 | 13,380,847 | 303,998 | 25,377,820 | ||||||||||||
|
|
||||||||||||||||
| Class R |
152,048 | 17,648,765 | 269,148 | 24,522,766 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
1,800,830 | 211,816,051 | 4,755,938 | 445,453,852 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
2,270,982 | 266,378,502 | 4,101,314 | 394,861,223 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
3,349,634 | 374,355,108 | 868,190 | 82,417,312 | ||||||||||||
|
|
||||||||||||||||
| Class C |
168,181 | 16,707,111 | 47,743 | 4,087,714 | ||||||||||||
|
|
||||||||||||||||
| Class R |
115,245 | 12,744,947 | 30,963 | 2,917,943 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
1,103,599 | 123,945,145 | 266,718 | 25,378,194 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
1,104,877 | 124,431,282 | 273,804 | 26,082,561 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
402,242 | 46,308,569 | 248,014 | 23,320,549 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(452,728 | ) | (46,308,569 | ) | (275,802 | ) | (23,320,549 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(5,070,661 | ) | (593,402,976 | ) | (12,590,846 | ) | (1,167,511,800 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(255,137 | ) | (26,524,496 | ) | (762,131 | ) | (62,943,912 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(270,597 | ) | (31,416,406 | ) | (682,904 | ) | (63,071,012 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(2,782,501 | ) | (326,017,881 | ) | (6,466,015 | ) | (594,852,185 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(1,870,872 | ) | (221,150,017 | ) | (8,133,986 | ) | (781,359,188 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
2,210,487 | $ | 234,277,516 | (13,963,119 | ) | $ | (1,288,253,760 | ) | ||||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 6% of the outstanding shares of the Fund. The Fund and the Fund’s principal underwriter or adviser, are parties to participation agreements with these entities whereby these entities sell units of interest in separate accounts funding variable products that are invested in the Fund. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as, securities brokerage, third party record keeping and account servicing and administrative services. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
15 Invesco Global Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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.
| ACTUAL | HYPOTHETICAL (5% annual return before expenses) |
|||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Ratio | |||||||
|
Class A |
$1,000.00 | $1,285.50 | $5.89 | $1,019.64 | $5.21 | 1.04% | ||||||
|
Class C |
1,000.00 | 1,280.80 | 10.24 | 1,015.82 | 9.05 | 1.81 | ||||||
|
Class R |
1,000.00 | 1,283.70 | 7.42 | 1,018.30 | 6.56 | 1.31 | ||||||
|
Class Y |
1,000.00 | 1,286.90 | 4.59 | 1,020.78 | 4.06 | 0.81 | ||||||
|
Class R5 |
1,000.00 | 1,288.00 | 3.80 | 1,021.47 | 3.36 | 0.67 | ||||||
|
Class R6 |
1,000.00 | 1,287.80 | 3.80 | 1,021.47 | 3.36 | 0.67 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
16 Invesco Global Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | O-GLBL-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders
|
April 30, 2021 | ||
|
| ||||
| Invesco Global Focus Fund
| ||||
| Nasdaq: | ||||
| A: GLVAX ∎ C: GLVCX ∎ R: GLVNX ∎ Y: GLVYX ∎ R5: GFFDX ∎ R6: GLVIX | ||||
| 2 |
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| 4 |
||||
| 5 |
||||
| 7 |
||||
| 10 |
||||
| 11 |
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| 16 |
||||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
2 Invesco Global Focus Fund
3 Invesco Global Focus Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Global Focus Fund
April 30, 2021
(Unaudited)
Investment Abbreviations:
ADR – American Depositary Receipt
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Global Focus Fund
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) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $89,471,810, which represented 9.10% of the Fund’s Net Assets. |
| (d) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | ||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: |
||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ 5,675,088 | $ 57,687,125 | $ (53,388,209) | $ - | $ - | $ 9,974,004 | $ 760 | |||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
4,052,847 | 41,205,090 | (38,134,435) | 492 | (673 | ) | 7,123,321 | 958 | ||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
6,485,815 | 65,928,143 | (61,015,096) | - | - | 11,398,862 | 348 | |||||||||||||||||||||
| Total |
$16,213,750 | $164,820,358 | $(152,537,740) | $492 | $(673) | $28,496,187 | $2,066 | |||||||||||||||||||||
| (e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Information Technology |
37.14 | % | ||
| Health Care |
22.90 | |||
| Communication Services |
19.21 | |||
| Consumer Discretionary |
16.34 | |||
| Industrials |
1.44 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
2.97 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Global Focus Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Global Focus Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
| |||
| Dividends (net of foreign withholding taxes of $87,316) |
$ | 733,079 | ||
| Dividends from affiliated money market funds |
2,066 | |||
| Total investment income |
735,145 | |||
| Expenses: |
||||
| Advisory fees |
3,303,353 | |||
| Administrative services fees |
62,308 | |||
| Custodian fees |
10,704 | |||
| Distribution fees: |
||||
| Class A |
411,739 | |||
| Class C |
380,295 | |||
| Class R |
72,886 | |||
| Transfer agent fees – A, C, R and Y |
509,081 | |||
| Transfer agent fees – R5 |
2 | |||
| Transfer agent fees – R6 |
4,631 | |||
| Trustees’ and officers’ fees and benefits |
16,813 | |||
| Registration and filing fees |
70,978 | |||
| Reports to shareholders |
48,101 | |||
| Professional services fees |
25,150 | |||
| Other |
26,342 | |||
| Total expenses |
4,942,383 | |||
| Less: Fees waived and/or expense offset arrangement(s) |
(8,248 | ) | ||
| Net expenses |
4,934,135 | |||
| Net investment income (loss) |
(4,198,990 | ) | ||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
45,595,432 | |||
| Affiliated investment securities |
(673 | ) | ||
| Foreign currencies |
35,551 | |||
| Forward foreign currency contracts |
19,982 | |||
| 45,650,292 | ||||
| Change in net unrealized appreciation of: |
||||
| Unaffiliated investment securities |
82,514,703 | |||
| Affiliated investment securities |
492 | |||
| Foreign currencies |
11,312 | |||
| 82,526,507 | ||||
| Net realized and unrealized gain |
128,176,799 | |||
| Net increase in net assets resulting from operations |
$123,977,809 | |||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Global Focus Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
| Operations: |
|
|||||||
| Net investment income (loss) |
$ | (4,198,990 | ) | $ | (4,016,375 | ) | ||
| Net realized gain |
45,650,292 | 37,290,188 | ||||||
| Change in net unrealized appreciation |
82,526,507 | 165,860,292 | ||||||
| Net increase in net assets resulting from operations |
123,977,809 | 199,134,105 | ||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(14,021,672 | ) | (14,079,195 | ) | ||||
| Class C |
(4,016,167 | ) | (4,595,162 | ) | ||||
| Class R |
(1,267,019 | ) | (980,122 | ) | ||||
| Class Y |
(15,198,819 | ) | (12,860,913 | ) | ||||
| Class R5 |
(702 | ) | (1,022 | ) | ||||
| Class R6 |
(1,794,069 | ) | (3,992,853 | ) | ||||
| Total distributions from distributable earnings |
(36,298,448 | ) | (36,509,267 | ) | ||||
| Share transactions–net: |
||||||||
| Class A |
76,776,343 | 66,103,196 | ||||||
| Class C |
(5,482,857 | ) | 12,749,165 | |||||
| Class R |
8,369,763 | 8,535,222 | ||||||
| Class Y |
83,645,355 | 96,991,564 | ||||||
| Class R5 |
- | 199 | ||||||
| Class R6 |
23,947,929 | (89,286,939 | ) | |||||
| Net increase in net assets resulting from share transactions |
187,256,533 | 95,092,407 | ||||||
| Net increase in net assets |
274,935,894 | 257,717,245 | ||||||
| Net assets: |
||||||||
| Beginning of period |
708,562,673 | 450,845,428 | ||||||
| End of period |
$ | 983,498,567 | $ | 708,562,673 | ||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Global Focus Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Distributions from net realized gains |
Net asset value, end of period |
Total return(b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average net assets with fee waivers and/or expenses absorbed |
Ratio of expenses to average net assets without investment fee waivers and/or expenses absorbed(c) |
Ratio of net investment income |
Portfolio turnover(d) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 72.26 | $ | (0.40 | ) | $ | 12.26 | $ | 11.86 | $ | (3.54 | ) | $ | 80.58 | 16.79 | %(e) | $ | 384,338 | 1.18 | %(e)(f) | 1.18 | %(e)(f) | (1.01 | )%(e)(f) | 18 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
52.99 | (0.51 | ) | 25.00 | 24.49 | (5.22 | ) | 72.26 | 50.31 | (e) | 273,684 | 1.26 | (e) | 1.26 | (e) | (0.84 | )(e) | 43 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 10/31/19 |
54.20 | (0.16 | ) | (1.05 | ) | (1.21 | ) | – | 52.99 | (2.23 | ) | 145,332 | 1.27 | (g) | 1.31 | (g) | (0.60 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/19 |
51.71 | (0.13 | ) | 4.48 | 4.35 | (1.86 | ) | 54.20 | 9.11 | 155,251 | 1.25 | 1.25 | (0.26 | ) | 46 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/18 |
45.73 | (0.24 | ) | 7.15 | 6.91 | (0.93 | ) | 51.71 | 15.17 | 148,492 | 1.27 | 1.28 | (0.47 | ) | 63 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/17 |
39.26 | (0.12 | ) | 6.59 | 6.47 | – | 45.73 | 16.51 | 145,248 | 1.30 | 1.30 | (0.29 | ) | 59 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/16 |
42.91 | (0.08 | ) | (3.57 | ) | (3.65 | ) | – | 39.26 | (8.53 | ) | 176,181 | 1.30 | 1.30 | (0.20 | ) | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
65.69 | (0.62 | ) | 11.09 | 10.47 | (3.54 | ) | 72.62 | 16.34 | 75,902 | 1.94 | (f) | 1.94 | (f) | (1.77 | )(f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
48.95 | (0.88 | ) | 22.84 | 21.96 | (5.22 | ) | 65.69 | 49.20 | 73,587 | 2.01 | 2.02 | (1.59 | ) | 43 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 10/31/19 |
50.26 | (0.33 | ) | (0.98 | ) | (1.31 | ) | - | 48.95 | (2.60 | ) | 43,574 | 2.01 | (g) | 2.07 | (g) | (1.34 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/19 |
48.45 | (0.49 | ) | 4.16 | 3.67 | (1.86 | ) | 50.26 | 8.28 | 55,891 | 2.01 | 2.01 | (1.02 | ) | 46 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/18 |
43.23 | (0.59 | ) | 6.74 | 6.15 | (0.93 | ) | 48.45 | 14.29 | 58,385 | 2.02 | 2.03 | (1.23 | ) | 63 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/17 |
37.39 | (0.42 | ) | 6.26 | 5.84 | – | 43.23 | 15.62 | 54,019 | 2.06 | 2.06 | (1.06 | ) | 59 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/16 |
41.18 | (0.37 | ) | (3.42 | ) | (3.79 | ) | – | 37.39 | (9.20 | ) | 70,795 | 2.06 | 2.06 | (0.96 | ) | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
69.91 | (0.48 | ) | 11.85 | 11.37 | (3.54 | ) | 77.74 | 16.65 | 34,103 | 1.44 | (f) | 1.44 | (f) | (1.27 | )(f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
51.54 | (0.65 | ) | 24.24 | 23.59 | (5.22 | ) | 69.91 | 49.95 | 22,854 | 1.52 | 1.52 | (1.10 | ) | 43 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 10/31/19 |
52.79 | (0.22 | ) | (1.03 | ) | (1.25 | ) | – | 51.54 | (2.37 | ) | 9,692 | 1.52 | (g) | 1.57 | (g) | (0.85 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/19 |
50.53 | (0.26 | ) | 4.38 | 4.12 | (1.86 | ) | 52.79 | 8.84 | 9,895 | 1.51 | 1.51 | (0.52 | ) | 46 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/18 |
44.82 | (0.36 | ) | 7.00 | 6.64 | (0.93 | ) | 50.53 | 14.88 | 7,812 | 1.52 | 1.53 | (0.73 | ) | 63 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/17 |
38.57 | (0.23 | ) | 6.48 | 6.25 | – | 44.82 | 16.21 | 6,898 | 1.56 | 1.56 | (0.56 | ) | 59 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/16 |
42.27 | (0.18 | ) | (3.52 | ) | (3.70 | ) | – | 38.57 | (8.76 | ) | 7,709 | 1.55 | 1.55 | (0.46 | ) | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
74.28 | (0.31 | ) | 12.60 | 12.29 | (3.54 | ) | 83.03 | 16.92 | 426,766 | 0.94 | (f) | 0.94 | (f) | (0.77 | )(f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
54.21 | (0.38 | ) | 25.67 | 25.29 | (5.22 | ) | 74.28 | 50.68 | 304,779 | 1.02 | 1.02 | (0.60 | ) | 43 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 10/31/19 |
55.39 | (0.10 | ) | (1.08 | ) | (1.18 | ) | – | 54.21 | (2.13 | ) | 138,470 | 1.02 | (g) | 1.07 | (g) | (0.36 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/19 |
52.67 | (0.01 | ) | 4.59 | 4.58 | (1.86 | ) | 55.39 | 9.36 | 301,919 | 1.02 | 1.02 | (0.03 | ) | 46 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/18 |
46.46 | (0.12 | ) | 7.26 | 7.14 | (0.93 | ) | 52.67 | 15.44 | 266,886 | 1.03 | 1.04 | (0.24 | ) | 63 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/17 |
39.78 | (0.00 | ) | 6.68 | 6.68 | – | 46.46 | 16.79 | 250,427 | 1.05 | 1.05 | (0.01 | ) | 59 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/16 |
43.38 | 0.02 | (3.62 | ) | (3.60 | ) | – | 39.78 | (8.28 | ) | 109,761 | 1.05 | 1.05 | 0.04 | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
72.67 | (0.26 | ) | 12.32 | 12.06 | (3.54 | ) | 81.19 | 16.99 | 16 | 0.84 | (f) | 0.84 | (f) | (0.67 | )(f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
53.08 | (0.28 | ) | 25.09 | 24.81 | (5.22 | ) | 72.67 | 50.88 | 14 | 0.89 | 0.89 | (0.47 | ) | 43 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/19(h) |
51.06 | (0.05 | ) | 2.07 | 2.02 | – | 53.08 | 3.96 | 10 | 0.90 | (g) | 0.92 | (g) | (0.23 | )(g) | 20 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
75.43 | (0.27 | ) | 12.81 | 12.54 | (3.54 | ) | 84.43 | 16.99 | 62,374 | 0.84 | (f) | 0.84 | (f) | (0.67 | )(f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
54.89 | (0.26 | ) | 26.02 | 25.76 | (5.22 | ) | 75.43 | 50.94 | 33,645 | 0.85 | 0.89 | (0.43 | ) | 43 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 10/31/19 |
56.03 | (0.05 | ) | (1.09 | ) | (1.14 | ) | – | 54.89 | (2.03 | ) | 113,768 | 0.85 | (g) | 0.87 | (g) | (0.18 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/19 |
53.16 | 0.08 | 4.65 | 4.73 | (1.86 | ) | 56.03 | 9.56 | 131,074 | 0.85 | 0.85 | 0.15 | 46 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/18 |
46.80 | (0.02 | ) | 7.31 | 7.29 | (0.93 | ) | 53.16 | 15.65 | 98,443 | 0.85 | 0.85 | (0.05 | ) | 63 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/17 |
40.00 | 0.05 | 6.75 | 6.80 | – | 46.80 | 17.00 | 75,145 | 0.86 | 0.86 | 0.13 | 59 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 04/30/16 |
43.53 | 0.08 | (3.61 | ) | (3.53 | ) | – | 40.00 | (8.11 | ) | 72,137 | 0.86 | 0.86 | 0.20 | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Does not include indirect expenses from affiliated fund fees and expenses of 0.00% for the six months ended October 31, 2019 and the years ended April 30, 2019, 2018, 2017 and 2016, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.24% for the six months ended April 30, 2021 and the year ended October 31, 2020. |
| (f) | Ratios are annualized and based on average daily net assets (000’s omitted) of $341,503, $76,689, $29,396, $374,442, $16 and $49,569 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (g) | Annualized. |
| (h) | Commencement date after the close of business on May 24, 2019. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Global Focus Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Global Focus Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
11 Invesco Global Focus Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. |
Therefore, no provision for federal income taxes is recorded in the financial statements.
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| J. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
12 Invesco Global Focus Fund
| forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities. |
| K. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
| L. | Other Risks - Emerging markets (also referred to as developing markets) are generally subject to greater market volatility, political, social and economic instability, uncertainty regarding the existence of trading markets and more governmental limitations on foreign investment than more developed markets. In addition, companies operating in emerging markets may be subject to lower trading volume and greater price fluctuations than companies in more developed markets. Securities law in many emerging market countries is relatively new and unsettled. Therefore, laws regarding foreign investment in emerging market securities, securities regulation, title to securities, and shareholder rights may change quickly and unpredictably. In addition, the enforcement of systems of taxation at federal, regional and local levels in emerging market countries may be inconsistent, and subject to sudden change. Other risks of investing in emerging markets securities may include additional transaction costs, delays in settlement procedures, and lack of timely information. |
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets* | Rate | |||||
| First $500 million |
0.800% | |||||
| Next $500 million |
0.750% | |||||
| Over $1 billion |
0.720% | |||||
| * | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.76%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through at least February 28, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.27%, 2.01%, 1.52%, 1.02%, 0.90%, and 0.85%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $7,215.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $111,042 in front-end sales commissions from the sale of Class A shares and $1,702 and $2,160 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
13 Invesco Global Focus Fund
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Investments in Securities |
||||||||||||||||
| Common Stocks & Other Equity Interests |
$682,839,872 | $271,440,872 | $– | $954,280,744 | ||||||||||||
| Money Market Funds |
28,496,187 | – | – | 28,496,187 | ||||||||||||
| Total Investments |
$711,336,059 | $271,440,872 | $– | $982,776,931 | ||||||||||||
NOTE 4–Derivative Investments
The Fund may enter into an ISDA Master Agreement under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Consolidated Statement of Assets and Liabilities.
Effect of Derivative Investments for the six months ended April 30, 2021
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
| Location of Gain on Statement of Operations |
||||
| Currency Risk |
||||
| Realized Gain: |
||||
| Forward foreign currency contracts |
$19,982 | |||
The table below summarizes the average notional value of derivatives held during the period.
| Forward Foreign Currency Contracts |
||||
| Average notional value |
$4,676,217 | |||
NOTE 5–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $1,033.
NOTE 6–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate
14 Invesco Global Focus Fund
by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 8–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 9–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $284,786,341 and $151,290,874, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
| Aggregate unrealized appreciation of investments |
$378,168,222 | |||
| Aggregate unrealized (depreciation) of investments |
(5,567,801 | ) | ||
| Net unrealized appreciation of investments |
$372,600,421 | |||
Cost of investments for tax purposes is $610,176,510.
NOTE 10–Share Information
| Summary of Share Activity | ||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
| Sold: |
||||||||||||||||
| Class A |
1,163,300 | $ | 91,290,623 | 1,477,048 | $ | 94,017,750 | ||||||||||
| Class C |
191,696 | 13,567,688 | 457,147 | 25,579,112 | ||||||||||||
| Class R |
131,912 | 9,964,831 | 213,155 | 13,458,838 | ||||||||||||
| Class Y |
1,397,047 | 113,024,348 | 2,307,997 | 142,268,923 | ||||||||||||
| Class R5 |
- | - | 3 | 199 | ||||||||||||
| Class R6 |
399,201 | 32,669,470 | 213,640 | 13,870,191 | ||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
179,137 | 13,379,754 | 261,532 | 13,338,160 | ||||||||||||
| Class C |
55,442 | 3,742,875 | 89,929 | 4,196,996 | ||||||||||||
| Class R |
17,538 | 1,264,827 | 19,687 | 973,520 | ||||||||||||
| Class Y |
166,685 | 12,818,076 | 207,499 | 10,856,339 | ||||||||||||
| Class R6 |
22,625 | 1,768,392 | 74,981 | 3,977,731 | ||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
181,009 | 14,186,240 | 45,306 | 2,890,416 | ||||||||||||
| Class C |
(200,365 | ) | (14,186,240 | ) | (49,713 | ) | (2,890,416 | ) | ||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(541,044 | ) | (42,080,274 | ) | (739,057 | ) | (44,143,130 | ) | ||||||||
| Class C |
(121,866 | ) | (8,607,180 | ) | (267,217 | ) | (14,136,527 | ) | ||||||||
| Class R |
(37,662 | ) | (2,859,895 | ) | (93,975 | ) | (5,897,136 | ) | ||||||||
| Class Y |
(527,142 | ) | (42,197,069 | ) | (966,519 | ) | (56,133,698 | ) | ||||||||
| Class R6 |
(129,077 | ) | (10,489,933 | ) | (1,915,245 | ) | (107,134,861 | ) | ||||||||
| Net increase in share activity | 2,348,436 | $ | 187,256,533 | 1,336,198 | $ | 95,092,407 | ||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 39% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
15 Invesco Global Focus Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL (5% annual return before expenses) |
Annualized |
||||||||||||||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
||||||||||||||||||||
| Class A | $1,000.00 | $1,167.90 | $6.34 | $1,018.94 | $5.91 | 1.18% | ||||||||||||||||||
| Class C | 1,000.00 | 1,163.40 | 10.41 | 1,015.17 | 9.69 | 1.94 | ||||||||||||||||||
| Class R | 1,000.00 | 1,166.50 | 7.74 | 1,017.65 | 7.20 | 1.44 | ||||||||||||||||||
| Class Y | 1,000.00 | 1,169.20 | 5.06 | 1,020.13 | 4.71 | 0.94 | ||||||||||||||||||
| Class R5 | 1,000.00 | 1,169.90 | 4.52 | 1,020.63 | 4.21 | 0.84 | ||||||||||||||||||
| Class R6 | 1,000.00 | 1,169.90 | 4.52 | 1,020.63 | 4.21 | 0.84 | ||||||||||||||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
16 Invesco Global Focus Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents. With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
|
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | O-GLF-SAR-1 |
|
Semiannual Report to Shareholders
|
April 30, 2021 | ||
| Invesco Global Growth Fund
|
||||
| Nasdaq: | ||||
| A: AGGAX ∎ C: AGGCX ∎ Y: AGGYX ∎ R5: GGAIX ∎ R6: AGGFX |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
| Performance summary
|
||||
| Fund vs. Indexes | ||||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
| Class A Shares |
28.61 | % | ||
| Class C Shares |
28.11 | |||
| Class Y Shares |
28.79 | |||
| Class R5 Shares |
28.86 | |||
| Class R6 Shares |
28.86 | |||
| MSCI All Country World Index▼ (Broad Market Index) |
28.29 | |||
| MSCI All Country World Growth Index▼ (Style-Specific Index) |
22.98 | |||
| Lipper Global Multi-Cap Growth Funds Index∎ (Peer Group Index)
|
26.78 | |||
| Source(s): ▼RIMES Technologies Corp.; ∎Lipper Inc. | ||||
|
The MSCI All Country World Index is an unmanaged index considered representative of large- and mid-cap stocks across developed and emerging markets. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||
| The MSCI All Country World Growth Index is an unmanaged index considered representative of large- and mid-cap growth stocks of developed and emerging markets. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||
| The Lipper Global Multi-Cap Growth Funds Index is an unmanaged index considered representative of global multicap growth funds tracked by Lipper. |
| |||
| The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
| A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
| |||
| For more information about your Fund |
| Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. |
|
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends. |
2 Invesco Global Growth Fund
3 Invesco Global Growth Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Global Growth Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Global Growth Fund
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, 2021. |
| (c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation (Depreciation) |
Realized Gain |
Value April 30, 2021 |
Dividend Income | ||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: |
||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$2,452,294 | $ | 40,129,166 | $ | (39,375,710 | ) | $ - | $ | - | $ | 3,205,750 | $2,444 | ||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
11,836,755 | 28,663,690 | (30,935,219 | ) | (441) | 494 | 9,565,279 | 5,767 | ||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
2,802,622 | 45,861,904 | (45,000,811 | ) | - | - | 3,663,715 | 1,571 | ||||||||||||||||||||||
| Investments Purchased with Cash Collateral from Securities on Loan: |
||||||||||||||||||||||||||||||
| Invesco Private Government Fund |
910,700 | 11,175,562 | (11,732,862 | ) | - | - | 353,400 | 124* | ||||||||||||||||||||||
| Invesco Private Prime Fund |
1,366,050 | 13,919,781 | (14,756,026 | ) | - | 295 | 530,100 | 1,092* | ||||||||||||||||||||||
| Total |
$19,368,421 | $ | 139,750,103 | $ | (141,800,628 | ) | $(441) | $789 | $17,318,244 | $10,998 | ||||||||||||||||||||
| * | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| (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 1I. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Global Growth Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Information Technology |
22.16% | |||
| Consumer Discretionary |
21.67 | |||
| Health Care |
12.70 | |||
| Financials |
12.44 | |||
| Industrials |
12.15 | |||
| Communication Services |
8.05 | |||
| Consumer Staples |
6.97 | |||
| Other Sectors, Each Less than 2% of Net Assets |
2.56 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
1.30 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Global Growth Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Global Growth Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $305,262) |
$ | 5,250,663 | ||
|
|
||||
| Dividends from affiliated money market funds (includes securities lending income of $5,716) |
15,498 | |||
|
|
||||
| Total investment income |
5,266,161 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
3,619,702 | |||
|
|
||||
| Administrative services fees |
62,528 | |||
|
|
||||
| Custodian fees |
17,081 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
949,829 | |||
|
|
||||
| Class C |
75,539 | |||
|
|
||||
| Transfer agent fees – A, C and Y |
664,517 | |||
|
|
||||
| Transfer agent fees – R5 |
33 | |||
|
|
||||
| Transfer agent fees – R6 |
675 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
24,641 | |||
|
|
||||
| Registration and filing fees |
38,264 | |||
|
|
||||
| Reports to shareholders |
31,084 | |||
|
|
||||
| Professional services fees |
34,601 | |||
|
|
||||
| Other |
18,019 | |||
|
|
||||
| Total expenses |
5,536,513 | |||
|
|
||||
| Less: Fees waived, expenses reimbursed and/or expense offset arrangement(s) |
(82,416 | ) | ||
|
|
||||
| Net expenses |
5,454,097 | |||
|
|
||||
| Net investment income (loss) |
(187,936 | ) | ||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
82,580,825 | |||
|
|
||||
| Affiliated investment securities |
789 | |||
|
|
||||
| Foreign currencies |
(119,954 | ) | ||
|
|
||||
| 82,461,660 | ||||
|
|
||||
| Change in net unrealized appreciation (depreciation) of: |
||||
| Unaffiliated investment securities |
146,052,267 | |||
|
|
||||
| Affiliated investment securities |
(441 | ) | ||
|
|
||||
| Foreign currencies |
23,716 | |||
|
|
||||
| 146,075,542 | ||||
|
|
||||
| Net realized and unrealized gain |
228,537,202 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 228,349,266 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Global Growth Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income (loss) |
$ | (187,936 | ) | $ | (297,168 | ) | ||
|
|
||||||||
| Net realized gain |
82,461,660 | 85,124,947 | ||||||
|
|
||||||||
| Change in net unrealized appreciation |
146,075,542 | 20,717,826 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
228,349,266 | 105,545,605 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(72,638,086 | ) | (24,908,096 | ) | ||||
|
|
||||||||
| Class C |
(1,758,251 | ) | (580,124 | ) | ||||
|
|
||||||||
| Class Y |
(3,338,952 | ) | (1,191,872 | ) | ||||
|
|
||||||||
| Class R5 |
(75,636 | ) | (7,808 | ) | ||||
|
|
||||||||
| Class R6 |
(12,341,173 | ) | (11,309,854 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(90,152,098 | ) | (37,997,754 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
38,602,091 | 300,246,353 | ||||||
|
|
||||||||
| Class C |
(1,469,739 | ) | 6,263,501 | |||||
|
|
||||||||
| Class Y |
3,154,900 | 12,862,631 | ||||||
|
|
||||||||
| Class R5 |
141,684 | 444,496 | ||||||
|
|
||||||||
| Class R6 |
869,348 | (22,381,326 | ) | |||||
|
|
||||||||
| Net increase in net assets resulting from share transactions |
41,298,284 | 297,435,655 | ||||||
|
|
||||||||
| Net increase in net assets |
179,495,452 | 364,983,506 | ||||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
811,986,022 | 447,002,516 | ||||||
|
|
||||||||
| End of period |
$ | 991,481,474 | $ | 811,986,022 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Global Growth Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period |
Total return (b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average net assets with fee waivers and/or expenses absorbed |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed |
Ratio of net investment income (loss) to average net assets |
Portfolio turnover (c) | |||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$32.19 | $(0.02 | ) | $8.79 | $8.77 | $ - | $(3.59) | $(3.59) | $37.37 | 28.61 | % | $810,218 | 1.22 | %(d) | 1.23 | %(d) | (0.09 | )%(d) | 29 | % | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
32.19 | (0.03 | ) | 2.77 | 2.74 | (0.29 | ) | (2.45 | ) | (2.74 | ) | 32.19 | 8.87 | 658,772 | 1.22 | 1.29 | (0.12 | ) | 90 | |||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
29.42 | 0.22 | 4.04 | 4.26 | (0.13 | ) | (1.36 | ) | (1.49 | ) | 32.19 | 15.46 | 296,262 | 1.22 | 1.32 | 0.72 | 32 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
32.21 | 0.24 | (2.25 | ) | (2.01 | ) | (0.31 | ) | (0.47 | ) | (0.78 | ) | 29.42 | (6.41 | ) | 273,874 | 1.22 | 1.32 | 0.74 | 32 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
28.00 | 0.21 | 4.22 | 4.43 | (0.09 | ) | (0.13 | ) | (0.22 | ) | 32.21 | 15.96 | 327,317 | 1.23 | 1.36 | 0.72 | 22 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
28.63 | 0.19 | 0.32 | 0.51 | (0.15 | ) | (0.99 | ) | (1.14 | ) | 28.00 | 2.00 | 311,412 | 1.29 | 1.38 | 0.70 | 19 | |||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
28.99 | (0.13 | ) | 7.85 | 7.72 | - | (3.59 | ) | (3.59 | ) | 33.12 | 28.11 | 15,167 | 1.97 | (d) | 1.98 | (d) | (0.84 | )(d) | 29 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
29.17 | (0.24 | ) | 2.51 | 2.27 | - | (2.45 | ) | (2.45 | ) | 28.99 | 8.09 | 14,628 | 1.97 | 2.04 | (0.87 | ) | 90 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
26.86 | (0.01 | ) | 3.68 | 3.67 | - | (1.36 | ) | (1.36 | ) | 29.17 | 14.61 | 6,963 | 1.97 | 2.07 | (0.03 | ) | 32 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
29.47 | (0.00 | ) | (2.05 | ) | (2.05 | ) | (0.09 | ) | (0.47 | ) | (0.56 | ) | 26.86 | (7.10 | ) | 21,058 | 1.97 | 2.07 | (0.01 | ) | 32 | ||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
25.74 | (0.01 | ) | 3.87 | 3.86 | - | (0.13 | ) | (0.13 | ) | 29.47 | 15.07 | 24,995 | 1.98 | 2.11 | (0.03 | ) | 22 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
26.45 | (0.01 | ) | 0.29 | 0.28 | - | (0.99 | ) | (0.99 | ) | 25.74 | 1.24 | 23,755 | 2.04 | 2.13 | (0.05 | ) | 19 | ||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
32.30 | 0.03 | 8.81 | 8.84 | (0.01 | ) | (3.59 | ) | (3.60 | ) | 37.54 | 28.75 | 37,367 | 0.97 | (d) | 0.98 | (d) | 0.16 | (d) | 29 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
32.28 | 0.04 | 2.80 | 2.84 | (0.37 | ) | (2.45 | ) | (2.82 | ) | 32.30 | 9.18 | 29,147 | 0.97 | 1.04 | 0.13 | 90 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
29.52 | 0.29 | 4.05 | 4.34 | (0.22 | ) | (1.36 | ) | (1.58 | ) | 32.28 | 15.74 | 13,871 | 0.97 | 1.07 | 0.97 | 32 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
32.31 | 0.32 | (2.25 | ) | (1.93 | ) | (0.39 | ) | (0.47 | ) | (0.86 | ) | 29.52 | (6.16 | ) | 14,935 | 0.97 | 1.07 | 0.99 | 32 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
28.09 | 0.29 | 4.23 | 4.52 | (0.17 | ) | (0.13 | ) | (0.30 | ) | 32.31 | 16.24 | 20,983 | 0.98 | 1.11 | 0.97 | 22 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
28.72 | 0.26 | 0.32 | 0.58 | (0.22 | ) | (0.99 | ) | (1.21 | ) | 28.09 | 2.27 | 12,562 | 1.04 | 1.13 | 0.95 | 19 | |||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
32.03 | 0.05 | 8.75 | 8.80 | (0.04 | ) | (3.59 | ) | (3.63 | ) | 37.20 | 28.86 | 928 | 0.83 | (d) | 0.83 | (d) | 0.30 | (d) | 29 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
32.03 | 0.07 | 2.78 | 2.85 | (0.40 | ) | (2.45 | ) | (2.85 | ) | 32.03 | 9.31 | 664 | 0.87 | 0.93 | 0.23 | 90 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
29.31 | 0.32 | 4.01 | 4.33 | (0.25 | ) | (1.36 | ) | (1.61 | ) | 32.03 | 15.84 | 12 | 0.86 | 0.86 | 1.08 | 32 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
32.09 | 0.34 | (2.23 | ) | (1.89 | ) | (0.42 | ) | (0.47 | ) | (0.89 | ) | 29.31 | (6.08 | ) | 11 | 0.88 | 0.88 | 1.08 | 32 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
27.91 | 0.32 | 4.20 | 4.52 | (0.21 | ) | (0.13 | ) | (0.34 | ) | 32.09 | 16.37 | 12 | 0.88 | 0.88 | 1.07 | 22 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
28.57 | 0.30 | 0.30 | 0.60 | (0.27 | ) | (0.99 | ) | (1.26 | ) | 27.91 | 2.35 | 11 | 0.89 | 0.90 | 1.10 | 19 | |||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
32.03 | 0.05 | 8.74 | 8.79 | (0.04 | ) | (3.59 | ) | (3.63 | ) | 37.19 | 28.86 | 127,801 | 0.82 | (d) | 0.82 | (d) | 0.31 | (d) | 29 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
32.03 | 0.08 | 2.77 | 2.85 | (0.40 | ) | (2.45 | ) | (2.85 | ) | 32.03 | 9.32 | 108,775 | 0.84 | 0.84 | 0.26 | 90 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
29.30 | 0.32 | 4.02 | 4.34 | (0.25 | ) | (1.36 | ) | (1.61 | ) | 32.03 | 15.88 | 129,894 | 0.86 | 0.86 | 1.08 | 32 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
32.08 | 0.34 | (2.23 | ) | (1.89 | ) | (0.42 | ) | (0.47 | ) | (0.89 | ) | 29.30 | (6.08 | ) | 266,574 | 0.88 | 0.88 | 1.08 | 32 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
27.91 | 0.32 | 4.19 | 4.51 | (0.21 | ) | (0.13 | ) | (0.34 | ) | 32.08 | 16.33 | 308,082 | 0.88 | 0.88 | 1.07 | 22 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
28.56 | 0.31 | 0.30 | 0.61 | (0.27 | ) | (0.99 | ) | (1.26 | ) | 27.91 | 2.39 | 320,339 | 0.89 | 0.90 | 1.10 | 19 | |||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable.. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. For the year ended October 31, 2020, the portfolio turnover calculation excludes the value of securities purchased of $264,724,061 and sold of $91,251,356 in the effort to realign the Fund’s portfolio holdings after the reorganization of Invesco Global Small & Mid Cap Growth Fund into the Fund. |
| (d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $766,160, $15,217, $34,639, $834 and $123,861 for Class A, Class C, Class Y, Class R5 and Class R6 shares,respectively. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Global Growth Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Global Growth Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of five different classes of shares: Class A, Class C, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income - Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 Invesco Global Growth Fund
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date.
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy 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. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the 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. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. 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. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The 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 Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
| J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 Invesco Global Growth Fund
| foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| L. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets | Rate | |
| First $ 250 million |
0.800% | |
| Next $250 million |
0.780% | |
| Next $500 million |
0.760% | |
| Next $1.5 billion |
0.740% | |
| Next $2.5 billion |
0.720% | |
| Next $2.5 billion |
0.700% | |
| Next $2.5 billion |
0.680% | |
| Over $10 billion |
0.660% |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.78%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2022, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class Y, Class R5 and Class R6 shares to 1.22%, 1.97%, 0.97%, 0.87% and 0.87%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $6,928 and reimbursed class level expenses of $69,236, $1,387, $3,120, $0 and $0 of Class A, Class C, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
14 Invesco Global Growth Fund
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A and Class C shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares and 1.00% of the average daily net assets of Class C shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $29,677 in front-end sales commissions from the sale of Class A shares and $38 and $116 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $5,756 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3– 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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||
| Investments in Securities |
||||||||||||||
| Brazil |
$ | 13,229,756 | $ | – | $– | $ 13,229,756 | ||||||||
| Canada |
33,561,368 | – | – | 33,561,368 | ||||||||||
| China |
44,207,298 | 25,080,049 | – | 69,287,347 | ||||||||||
| Denmark |
– | 4,700,893 | – | 4,700,893 | ||||||||||
| France |
10,884,113 | 13,910,301 | – | 24,794,414 | ||||||||||
| Germany |
– | 14,100,296 | – | 14,100,296 | ||||||||||
| Hong Kong |
– | 10,604,659 | – | 10,604,659 | ||||||||||
| India |
13,345,188 | – | – | 13,345,188 | ||||||||||
| Ireland |
– | 20,357,942 | – | 20,357,942 | ||||||||||
| Italy |
– | 10,672,570 | – | 10,672,570 | ||||||||||
| Japan |
– | 39,642,069 | – | 39,642,069 | ||||||||||
| Macau |
– | 6,611,245 | – | 6,611,245 | ||||||||||
| Mexico |
36,834,748 | – | – | 36,834,748 | ||||||||||
| Netherlands |
– | 19,523,105 | – | 19,523,105 | ||||||||||
| South Korea |
– | 11,919,117 | – | 11,919,117 | ||||||||||
| Sweden |
– | 14,763,383 | – | 14,763,383 | ||||||||||
| Switzerland |
– | 8,687,869 | – | 8,687,869 | ||||||||||
| Taiwan |
– | 11,645,963 | – | 11,645,963 | ||||||||||
| United Kingdom |
– | 61,552,499 | – | 61,552,499 | ||||||||||
| United States |
552,786,580 | – | – | 552,786,580 | ||||||||||
| Money Market Funds |
16,434,744 | 883,500 | – | 17,318,244 | ||||||||||
| Total Investments |
$ | 721,283,795 | $ | 274,655,460 | $– | $995,939,255 | ||||||||
NOTE 4– Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $1,745.
15 Invesco Global Growth Fund
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $253,955,159 and $302,279,089, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis |
| |||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 347,232,390 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(2,212,942 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 345,019,448 | ||
|
|
||||
Cost of investments for tax purposes is $650,919,807.
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
| Sold: |
||||||||||||||||
| Class A |
341,259 | $ | 12,125,180 | 498,034 | $ | 15,325,818 | ||||||||||
| Class C |
40,159 | 1,274,518 | 73,032 | 2,033,422 | ||||||||||||
| Class Y |
161,620 | 5,780,911 | 175,682 | 5,464,935 | ||||||||||||
| Class R5 |
2,074 | 70,310 | 3,063 | 98,851 | ||||||||||||
| Class R6 |
40,015 | 1,403,913 | 292,181 | 7,352,939 | ||||||||||||
| Issued as reinvestment of dividends: |
|
|||||||||||||||
| Class A |
2,033,819 | 67,705,837 | 728,048 | 22,496,680 | ||||||||||||
| Class C |
56,446 | 1,670,223 | 19,433 | 544,308 | ||||||||||||
| Class Y |
84,932 | 2,837,589 | 31,560 | 976,162 | ||||||||||||
| Class R5 |
2,217 | 73,367 | 219 | 6,712 | ||||||||||||
| Class R6 |
372,590 | 12,325,273 | 369,101 | 11,305,578 | ||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
|
|||||||||||||||
| Class A |
77,188 | 2,635,453 | 33,509 | 1,047,015 | ||||||||||||
| Class C |
(86,859 | ) | (2,635,453 | ) | (37,142 | ) | (1,047,015 | ) | ||||||||
| Issued in connection with acquisitions:(b) |
|
|||||||||||||||
| Class A |
- | - | 12,268,714 | 331,385,465 | ||||||||||||
| Class C |
- | - | 325,621 | 7,951,237 | ||||||||||||
| Class Y |
- | - | 498,214 | 13,481,249 | ||||||||||||
| Class R5 |
- | - | 79,171 | 2,123,036 | ||||||||||||
| Class R6 |
- | - | 68,630 | 1,839,906 | ||||||||||||
16 Invesco Global Growth Fund
| Summary of Share Activity | ||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
Reacquired: |
||||||||||||||||
| Class A |
(1,235,168 | ) | $ | (43,864,379 | ) | (2,270,221 | ) | $ | (70,008,625 | ) | ||||||
| Class C |
(56,485 | ) | (1,779,027 | ) | (114,979 | ) | (3,218,451 | ) | ||||||||
| Class Y |
(153,638 | ) | (5,463,600 | ) | (232,786 | ) | (7,059,715 | ) | ||||||||
| Class R5 |
(56 | ) | (1,993 | ) | (62,112 | ) | (1,784,103 | ) | ||||||||
| Class R6 |
(372,180 | ) | (12,859,838 | ) | (1,389,483 | ) | (42,879,749 | ) | ||||||||
| Net increase in share activity |
1,307,933 | $ | 41,298,284 | 11,357,489 | $ | 297,435,655 | ||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 30% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
| (b) | After the close of business on April 17, 2020, the Fund acquired all the net assets of Invesco Global Small & Mid Cap Growth Fund (the “Target Fund”) pursuant to a plan of reorganization approved by the Board of Trustees of the Fund on February 14, 2020. The reorganization was executed in order to reduce overlap and increase efficiencies in the Adviser’s product line. The acquisition was accomplished by a tax-free exchange of 13,240,350 shares of the Fund for 25,876,586 shares outstanding of the Target Fund as of the close of business on April 17, 2020. Shares of the Target Fund were exchanged for the like class of shares of the Fund, based on the relative net asset value of the Target Fund to the net asset value of the Fund on the close of business, April 17, 2020. The Target Fund’s net assets as of the close of business on April 17, 2020 of $356,780,893, including $46,380,795 of unrealized appreciation, were combined with those of the Fund. The net assets of the Fund immediately before the acquisition were $388,600,725 and $745,381,619 immediately after the acquisition. |
The pro forma results of operations for the year ended October 31, 2020 assuming the reorganization had been completed on November 1, 2019, the beginning of the annual reporting period are as follows:
| Net investment income (loss) |
$ | (346,513 | ) | |
|
|
||||
| Net realized/unrealized gains (losses) |
52,746,697 | |||
|
|
||||
| Change in net assets resulting from operations |
$ | 52,400,184 | ||
|
|
||||
As the combined investment portfolios have been managed as a single integrated portfolio since the acquisition was completed, it is not practicable to separate the amounts of revenue and earnings of the Target Fund that has been included in the Fund’s Statement of Operations since April 18, 2020.
17 Invesco Global Growth Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL | HYPOTHETICAL (5% annual return before expenses) |
|||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Expense Ratio | |||||||
| Class A |
$1,000.00 | $1,286.10 | $6.92 | $1,018.74 | $6.11 | 1.22% | ||||||
| Class C |
1,000.00 | 1,281.10 | 11.14 | 1,015.03 | 9.84 | 1.97 | ||||||
| Class Y |
1,000.00 | 1,287.90 | 5.50 | 1,019.98 | 4.86 | 0.97 | ||||||
| Class R5 |
1,000.00 | 1,288.60 | 4.71 | 1,020.68 | 4.16 | 0.83 | ||||||
|
Class R6 |
1,000.00 | 1,288.60 | 4.65 | 1,020.73 | 4.11 | 0.82 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
18 Invesco Global Growth Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | GLG-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders
|
April 30, 2021
| ||
|
| ||||
| Invesco Global Opportunities Fund | ||||
|
Nasdaq: A: OPGIX ∎ C: OGICX ∎ R: OGINX ∎ Y: OGIYX ∎ R5: GOFFX ∎ R6: OGIIX | ||||
| 2 | Fund Performance | |
| 4 | Liquidity Risk Management Program | |
| 5 | Schedule of Investments | |
| 9 | Financial Statements | |
| 12 | Financial Highlights | |
| 13 | Notes to Financial Statements | |
| 18 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
| Performance summary | ||||
| Fund vs. Indexes |
||||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
| Class A Shares |
29.72 | % | ||
| Class C Shares |
29.23 | |||
| Class R Shares |
29.54 | |||
| Class Y Shares |
29.86 | |||
| Class R5 Shares |
29.93 | |||
| Class R6 Shares |
29.92 | |||
| MSCI All Country World Indexq |
28.29 | |||
| Source(s): q RIMES Technologies Corp. |
||||
| The MSCI All Country World Index is an unmanaged index considered representative of large- and mid-cap stocks across developed and emerging markets. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||
| The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
| A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
| |||
| For more information about your Fund |
| Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends. |
2 Invesco Global Opportunities Fund
3 Invesco Global Opportunities Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Global Opportunities Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Global Opportunities Fund
Investment Abbreviations:
| ADR | - American Depositary Receipt | |
| BR | - Bearer Shares | |
| Wts. | - Warrants |
Notes to Schedule of Investments:
| (a) | Affiliated issuer. The issuer is affiliated by having an investment adviser that is under common control of Invesco Ltd. and/or the Investment Company Act of 1940, as amended (the “1940 Act”), defines “affiliated person” to include an issuer of which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation (Depreciation) |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: |
||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ | 30,167,300 | $ | 149,471,159 | $ | (156,924,204 | ) | $ | - | $ | - | $ | 22,714,255 | $ | 5,218 | |||||||||||||
|
|
||||||||||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
21,540,716 | 106,765,113 | (112,081,187 | ) | 546 | (750) | 16,224,438 | 4,381 | ||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
34,476,914 | 170,824,181 | (179,341,947 | ) | - | - | 25,959,148 | 2,272 | ||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Global Opportunities Fund
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation (Depreciation) |
Realized (Loss) |
Value April 30, 2021 |
Dividend Income | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Investments in Other Affiliates: |
|
|||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| 3D Systems Corp.* |
$ | 45,520,000 | $ | - | $ | (76,889,338 | ) | $ | 103,332,981 | $ | 35,736,357 | $ | 107,700,000 | $ - | ||||||||||||||
|
|
||||||||||||||||||||||||||||
| Acacia Research Corp. |
7,875,000 | - | - | 7,325,000 | - | 15,200,000 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Aston Martin Lagonda Global Holdings PLC* |
72,096,831 | - | - | 65,209,926 | - | 137,306,757 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Aumann AG |
10,653,002 | - | - | 3,817,466 | - | 14,470,468 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Basler AG |
35,803,703 | - | - | 42,540,837 | - | 78,344,540 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Biocartis Group N.V. |
26,079,669 | - | - | 4,825,683 | - | 30,905,352 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Boozt AB |
60,619,871 | - | - | 26,682,102 | - | 87,301,973 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Comture Corp. |
76,676,996 | - | - | (4,232,266) | - | 72,444,730 | 368,692 | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Frontier Developments PLC |
101,399,171 | - | - | 32,250,772 | - | 133,649,943 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| GeNeuro S.A. |
5,166,059 | - | - | 4,621,094 | - | 9,787,153 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Gooch & Housego PLC |
27,322,902 | - | - | 5,689,231 | - | 33,012,133 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| IQE PLC |
99,620,341 | - | - | 13,750,373 | - | 113,370,714 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Jeol Ltd. |
79,306,977 | - | - | 61,454,109 | - | 140,761,086 | 230,362 | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| M&C Saatchi PLC |
4,907,870 | - | - | 7,124,964 | - | 12,032,834 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Manz AG |
16,783,053 | - | - | 16,085,651 | - | 32,868,704 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Materialise N.V., ADR |
105,307,000 | - | (13,904,334 | ) | (15,203,000) | 10,568,334 | 86,768,000 | - | ||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Napster Group PLC* |
3,473,558 | 2,950,123 | - | (2,898,364) | - | 3,525,317 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Nektar Therapeutics |
551,707,200 | - | (1,327,306 | ) | 133,650,468 | (2,582,862 | ) | 681,447,500 | - | |||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Optex Group Co. Ltd. |
29,809,221 | - | - | 674,719 | - | 30,483,940 | 245,369 | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| PDF Solutions, Inc. |
56,220,000 | - | - | (3,030,000) | - | 53,190,000 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| PVA TePla AG |
25,028,147 | 3,165,817 | - | 35,641,032 | - | 63,834,996 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| RaySearch Laboratories AB |
33,901,495 | - | - | 5,503,779 | - | 39,405,274 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Rovio Entertainment OYJ |
28,109,172 | - | - | 9,305,890 | - | 37,415,062 | 563,271 | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| SLM Solutions Group AG |
23,879,745 | - | - | 20,952,092 | - | 44,831,837 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Veeco Instruments, Inc. |
50,920,000 | - | - | 41,120,000 | - | 92,040,000 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| WANdisco PLC |
29,152,089 | - | - | 3,252,953 | - | 32,405,042 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Xaar PLC |
6,788,454 | - | - | 3,099,452 | - | 9,887,906 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Zoo Digital Group PLC |
4,988,526 | - | - | 6,315,618 | - | 11,304,144 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Zotefoams PLC |
21,302,651 | - | - | 1,470,220 | - | 22,772,871 | - | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Total |
$ | 1,726,603,633 | $ | 433,176,393 | $ | (540,468,316) | $ | 630,333,328 | $ | 43,721,079 | $ | 2,293,366,117 | $ 1,419,565 | |||||||||||||||
|
|
||||||||||||||||||||||||||||
| * | At April 30, 2021, this security was no longer an affiliate of the Fund. |
| (b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $338,383,939, which represented 3.48% of the Fund’s Net Assets. |
| (c) | Non-income producing security. |
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Global Opportunities Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Information Technology |
37.44 | % | ||
| Health Care |
30.44 | |||
| Industrials |
11.52 | |||
| Consumer Discretionary |
10.47 | |||
| Communication Services |
5.00 | |||
| Consumer Staples |
2.62 | |||
| Other Sectors, Each Less than 2% of Net Assets |
1.78 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
0.73 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Global Opportunities Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Global Opportunities Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $ 902,501) |
$ | 13,895,216 | ||
|
|
||||
| Dividends from affiliates |
1,419,565 | |||
|
|
||||
| Total investment income |
15,314,781 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
30,221,834 | |||
|
|
||||
| Administrative services fees |
671,377 | |||
|
|
||||
| Custodian fees |
124,006 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
4,984,230 | |||
|
|
||||
| Class C |
2,396,300 | |||
|
|
||||
| Class R |
710,044 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
3,800,231 | |||
|
|
||||
| Transfer agent fees – R6 |
45,763 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
68,029 | |||
|
|
||||
| Registration and filing fees |
124,123 | |||
|
|
||||
| Reports to shareholders |
242,987 | |||
|
|
||||
| Professional services fees |
47,541 | |||
|
|
||||
| Other |
104,481 | |||
|
|
||||
| Total expenses |
43,540,946 | |||
|
|
||||
| Less: Fees waived and/or expense offset arrangement(s) |
(50,512 | ) | ||
|
|
||||
| Net expenses |
43,490,434 | |||
|
|
||||
| Net investment income (loss) |
(28,175,653 | ) | ||
|
|
||||
| Realized and unrealized gain from: |
||||
| Net realized gain from: |
||||
| Unaffiliated investment securities |
229,659,480 | |||
|
|
||||
| Affiliated investment securities |
43,721,079 | |||
|
|
||||
| Foreign currencies |
158,481 | |||
|
|
||||
| 273,539,040 | ||||
|
|
||||
| Change in net unrealized appreciation of: |
||||
| Unaffiliated investment securities |
1,356,809,206 | |||
|
|
||||
| Affiliated investment securities |
630,333,328 | |||
|
|
||||
| Foreign currencies |
118,793 | |||
|
|
||||
| 1,987,261,327 | ||||
|
|
||||
| Net realized and unrealized gain |
2,260,800,367 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 2,232,624,714 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Global Opportunities Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income (loss) |
$ | (28,175,653 | ) | $ | (46,356,555 | ) | ||
|
|
||||||||
| Net realized gain |
273,539,040 | 766,889,344 | ||||||
|
|
||||||||
| Change in net unrealized appreciation |
1,987,261,327 | 864,954,929 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
2,232,624,714 | 1,585,487,718 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(339,287,360 | ) | (197,647,554 | ) | ||||
|
|
||||||||
| Class C |
(50,327,366 | ) | (34,387,552 | ) | ||||
|
|
||||||||
| Class R |
(25,015,142 | ) | (14,772,775 | ) | ||||
|
|
||||||||
| Class Y |
(197,213,266 | ) | (130,780,055 | ) | ||||
|
|
||||||||
| Class R5 |
(1,196 | ) | (645 | ) | ||||
|
|
||||||||
| Class R6 |
(155,622,626 | ) | (80,621,014 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(767,466,956 | ) | (458,209,595 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
253,454,154 | (255,705,590 | ) | |||||
|
|
||||||||
| Class C |
(28,627,373 | ) | (102,393,928 | ) | ||||
|
|
||||||||
| Class R |
12,177,764 | (24,995,841 | ) | |||||
|
|
||||||||
| Class Y |
254,350,995 | (447,927,410 | ) | |||||
|
|
||||||||
| Class R5 |
5,547 | – | ||||||
|
|
||||||||
| Class R6 |
252,388,423 | 26,581,446 | ||||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
743,749,510 | (804,441,323 | ) | |||||
|
|
||||||||
| Net increase in net assets |
2,208,907,268 | 322,836,800 | ||||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
7,514,270,834 | 7,191,434,034 | ||||||
|
|
||||||||
| End of period |
$ | 9,723,178,102 | $ | 7,514,270,834 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Global Opportunities Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period |
Total return(b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average net assets with fee waivers and/or expenses absorbed |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed(c) |
Ratio of net investment income (loss) to average net assets |
Portfolio turnover(d) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 68.56 | $ | (0.28 | ) | $ | 20.11 | $ | 19.83 | $ | – | $ | (7.00 | ) | $ | (7.00 | ) | $ | 81.39 | 29.72 | % | $ | 4,264,604 | 1.02 | %(e) | 1.02 | %(e) | (0.69 | )%(e) | 4 | % | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
57.92 | (0.45 | ) | 14.86 | 14.41 | – | (3.77 | ) | (3.77 | ) | 68.56 | 25.88 | (f) | 3,359,360 | 1.10 | (f) | 1.10 | (f) | (0.74 | )(f) | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
56.16 | (0.04 | ) | 1.80 | 1.76 | – | – | – | 57.92 | 3.13 | 3,099,689 | 1.09 | (g) | 1.09 | (g) | (0.90 | )(g) | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
75.01 | (0.15 | ) | (13.16 | ) | (13.31 | ) | – | (5.54 | ) | (5.54 | ) | 56.16 | (17.48 | ) | 3,059,916 | 1.12 | 1.12 | (0.25 | ) | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
61.40 | (0.22 | ) | 15.42 | 15.20 | – | (1.59 | ) | (1.59 | ) | 75.01 | 25.09 | 4,124,481 | 1.12 | 1.12 | (0.31 | ) | 21 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
50.76 | (0.23 | ) | 14.49 | 14.26 | (0.13 | ) | (3.49 | ) | (3.62 | ) | 61.40 | 30.48 | 3,085,024 | 1.17 | 1.17 | (0.43 | ) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
39.42 | (0.17 | ) | 11.81 | 11.64 | (0.05 | ) | (0.25 | ) | (0.30 | ) | 50.76 | 29.66 | 2,529,288 | 1.18 | 1.18 | (0.39 | ) | 26 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
57.90 | (0.48 | ) | 16.88 | 16.40 | – | (7.00 | ) | (7.00 | ) | 67.30 | 29.23 | 465,313 | 1.78 | (e) | 1.78 | (e) | (1.45 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
49.81 | (0.77 | ) | 12.63 | 11.86 | – | (3.77 | ) | (3.77 | ) | 57.90 | 24.91 | 422,919 | 1.86 | 1.86 | (1.50 | ) | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
48.32 | (0.07 | ) | 1.56 | 1.49 | – | – | – | 49.81 | 3.08 | 467,908 | 1.84 | (g) | 1.84 | (g) | (1.65 | )(g) | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
65.97 | (0.52 | ) | (11.59 | ) | (12.11 | ) | – | (5.54 | ) | (5.54 | ) | 48.32 | (18.12 | ) | 469,174 | 1.88 | 1.88 | (1.01 | ) | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
54.57 | (0.67 | ) | 13.66 | 12.99 | – | (1.59 | ) | (1.59 | ) | 65.97 | 24.15 | 955,893 | 1.87 | 1.87 | (1.06 | ) | 21 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
45.72 | (0.56 | ) | 12.90 | 12.34 | – | (3.49 | ) | (3.49 | ) | 54.57 | 29.47 | 648,270 | 1.92 | 1.92 | (1.18 | ) | 18 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
35.75 | (0.45 | ) | 10.67 | 10.22 | – | (0.25 | ) | (0.25 | ) | 45.72 | 28.71 | 475,199 | 1.94 | 1.94 | (1.14 | ) | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
65.02 | (0.36 | ) | 19.03 | 18.67 | – | (7.00 | ) | (7.00 | ) | 76.69 | 29.54 | 288,989 | 1.28 | (e) | 1.28 | (e) | (0.95 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
55.25 | (0.58 | ) | 14.12 | 13.54 | – | (3.77 | ) | (3.77 | ) | 65.02 | 25.53 | 233,141 | 1.36 | 1.36 | (1.00 | ) | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
53.58 | (0.05 | ) | 1.72 | 1.67 | – | – | – | 55.25 | 3.12 | 221,803 | 1.34 | (g) | 1.34 | (g) | (1.15 | )(g) | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
72.06 | (0.28 | ) | (12.66 | ) | (12.94 | ) | – | (5.54 | ) | (5.54 | ) | 53.58 | (17.71 | ) | 218,747 | 1.37 | 1.37 | (0.51 | ) | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
59.18 | (0.39 | ) | 14.86 | 14.47 | – | (1.59 | ) | (1.59 | ) | 72.06 | 24.79 | 276,790 | 1.37 | 1.37 | (0.56 | ) | 21 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
49.10 | (0.35 | ) | 13.98 | 13.63 | (0.06 | ) | (3.49 | ) | (3.55 | ) | 59.18 | 30.15 | 199,696 | 1.42 | 1.42 | (0.67 | ) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
38.19 | (0.27 | ) | 11.43 | 11.16 | – | (0.25 | ) | (0.25 | ) | 49.10 | 29.34 | 123,310 | 1.44 | 1.44 | (0.64 | ) | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
70.00 | (0.18 | ) | 20.53 | 20.35 | – | (7.00 | ) | (7.00 | ) | 83.35 | 29.86 | 2,580,287 | 0.78 | (e) | 0.78 | (e) | (0.45 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
58.93 | (0.31 | ) | 15.15 | 14.84 | – | (3.77 | ) | (3.77 | ) | 70.00 | 26.18 | 1,940,275 | 0.86 | 0.86 | (0.50 | ) | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
57.13 | (0.03 | ) | 1.83 | 1.80 | – | – | – | 58.93 | 3.15 | 2,113,652 | 0.84 | (g) | 0.84 | (g) | (0.65 | )(g) | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
76.02 | – | (13.35 | ) | (13.35 | ) | – | (5.54 | ) | (5.54 | ) | 57.13 | (17.29 | ) | 2,120,749 | 0.87 | 0.87 | (0.01 | ) | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
62.05 | (0.05 | ) | 15.61 | 15.56 | – | (1.59 | ) | (1.59 | ) | 76.02 | 25.40 | 3,055,996 | 0.87 | 0.87 | (0.07 | ) | 21 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
51.28 | (0.09 | ) | 14.61 | 14.52 | (0.26 | ) | (3.49 | ) | (3.75 | ) | 62.05 | 30.79 | 1,241,346 | 0.92 | 0.92 | (0.16 | ) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
39.82 | (0.06 | ) | 11.92 | 11.86 | (0.15 | ) | (0.25 | ) | (0.40 | ) | 51.28 | 29.98 | 544,742 | 0.94 | 0.94 | (0.14 | ) | 26 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
68.95 | (0.14 | ) | 20.22 | 20.08 | – | (7.00 | ) | (7.00 | ) | 82.03 | 29.93 | 20 | 0.68 | (e) | 0.68 | (e) | (0.35 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
58.01 | (0.21 | ) | 14.92 | 14.71 | – | (3.77 | ) | (3.77 | ) | 68.95 | 26.38 | 12 | 0.70 | 0.70 | (0.34 | ) | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
56.23 | (0.02 | ) | 1.80 | 1.78 | – | – | – | 58.01 | 3.16 | 10 | 0.68 | (g) | 0.68 | (g) | (0.50 | )(g) | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 09/30/19(h) |
58.48 | 0.03 | (2.28 | ) | (2.25 | ) | – | – | – | 56.23 | (3.85 | ) | 10 | 0.74 | (g) | 0.74 | (g) | 0.12 | (g) | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
70.67 | (0.15 | ) | 20.74 | 20.59 | – | (7.00 | ) | (7.00 | ) | 84.26 | 29.92 | 2,123,965 | 0.68 | (e) | 0.68 | (e) | (0.35 | )(e) | 4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
59.37 | (0.21 | ) | 15.28 | 15.07 | – | (3.77 | ) | (3.77 | ) | 70.67 | 26.39 | 1,558,563 | 0.70 | 0.70 | (0.34 | ) | 12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| One month ended 10/31/19 |
57.55 | (0.02 | ) | 1.84 | 1.82 | – | – | – | 59.37 | 3.16 | 1,288,373 | 0.69 | (g) | 0.69 | (g) | (0.50 | )(g) | 3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/19 |
76.41 | 0.09 | (13.41 | ) | (13.32 | ) | – | (5.54 | ) | (5.54 | ) | 57.55 | (17.16 | ) | 1,272,938 | 0.71 | 0.71 | 0.15 | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/18 |
62.26 | 0.07 | 15.67 | 15.74 | – | (1.59 | ) | (1.59 | ) | 76.41 | 25.61 | 1,403,832 | 0.71 | 0.71 | 0.10 | 21 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/17 |
51.43 | – | 14.66 | 14.66 | (0.34 | ) | (3.49 | ) | (3.83 | ) | 62.26 | 31.01 | 662,176 | 0.73 | 0.73 | 0.01 | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 09/30/16 |
39.93 | 0.02 | 11.97 | 11.99 | (0.24 | ) | (0.25 | ) | (0.49 | ) | 51.43 | 30.21 | 127,643 | 0.75 | 0.75 | 0.04 | 26 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Does not include estimated acquired fund fees from underlying funds of 0.00% for the one month ended October 31, 2019 and the years ended September 30, 2019, 2018, 2017 and 2016, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $4,162,057, $483,232, $286,371, $2,471,328, $16 and $1,997,545 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (f) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.24% for the year ended October 31, 2020. |
| (g) | Annualized. |
| (h) | Commencement date after the close of business on May 24, 2019. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco Global Opportunities Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Global Opportunities Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services - Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
13 Invesco Global Opportunities Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| J. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
14 Invesco Global Opportunities Fund
forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| K. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets* | Rate | |||
| First $250 million |
0.800 | % | ||
| Next $250 million |
0.770 | % | ||
| Next $500 million |
0.750 | % | ||
| Next $1 billion |
0.690 | % | ||
| Next $1.5 billion |
0.670 | % | ||
| Next $2.5 billion |
0.650 | % | ||
| Next $4 billion |
0.630 | % | ||
| Over $10 billion |
0.610 | % | ||
| * | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.65%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through May 31, 2021, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit the total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.17%, 1.92%, 1.42%, 0.92%, 0.78% and 0.73%, respectively, of the Fund’s average daily net assets (the “expense limits”). Effective June 1, 2021 through at least June 30, 2022, the Adviser has contractually agreed to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual operating expenses after fee waivers and/or expense reimbursements of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.25%, 3.00%, 2.50%, 2.00%, 2.00% and 2.00% respectively, of the Fund’s average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waivers and/or expense reimbursement to exceed the numbers reflected above: (1) interest, facilities and maintenance fees; (2) taxes; (3) dividend expenses on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $43,758.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $285,674 in front-end sales commissions from the sale of Class A shares and $4,594 and $7,374 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $2,005 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
15 Invesco Global Opportunities Fund
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||
| Investments in Securities |
||||||||||||||
| Belgium |
$ 86,768,000 | $ 75,577,083 | $– | $ 162,345,083 | ||||||||||
| Canada |
17,660,000 | – | – | 17,660,000 | ||||||||||
| Denmark |
– | 334,650,707 | – | 334,650,707 | ||||||||||
| Finland |
– | 37,415,062 | – | 37,415,062 | ||||||||||
| France |
396,742 | 197,074,968 | – | 197,471,710 | ||||||||||
| Germany |
– | 523,023,449 | – | 523,023,449 | ||||||||||
| Ireland |
– | 83,330,366 | – | 83,330,366 | ||||||||||
| Israel |
158,940,000 | – | – | 158,940,000 | ||||||||||
| Italy |
– | 143,629,992 | – | 143,629,992 | ||||||||||
| Japan |
– | 1,086,759,231 | – | 1,086,759,231 | ||||||||||
| Luxembourg |
– | 197,961,410 | – | 197,961,410 | ||||||||||
| Norway |
– | 241,517,304 | – | 241,517,304 | ||||||||||
| Sweden |
– | 649,112,193 | – | 649,112,193 | ||||||||||
| Switzerland |
– | 80,514,808 | – | 80,514,808 | ||||||||||
| United Kingdom |
– | 1,261,272,847 | – | 1,261,272,847 | ||||||||||
| United States |
4,476,379,300 | – | – | 4,476,379,300 | ||||||||||
| Money Market Funds |
64,897,841 | – | – | 64,897,841 | ||||||||||
| Total Investments |
$4,805,041,883 | $4,911,839,420 | $– | $9,716,881,303 | ||||||||||
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $6,754.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
16 Invesco Global Opportunities Fund
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $400,923,277 and $434,842,488, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 4,635,201,613 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(896,984,052 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 3,738,217,561 | ||
|
|
||||
Cost of investments for tax purposes is $5,978,663,742.
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
3,186,520 | $ | 257,368,788 | 4,727,712 | $ | 285,002,521 | ||||||||||
|
|
||||||||||||||||
| Class C |
499,465 | 33,596,802 | 823,749 | 41,342,484 | ||||||||||||
|
|
||||||||||||||||
| Class R |
347,671 | 26,472,543 | 594,844 | 33,424,390 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
5,527,853 | 456,544,646 | 8,377,955 | 505,921,561 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
68 | 5,550 | - | - | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
4,323,055 | 361,599,950 | 6,010,630 | 369,817,219 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
4,232,610 | 319,308,136 | 3,133,432 | 186,313,864 | ||||||||||||
|
|
||||||||||||||||
| Class C |
764,058 | 47,799,481 | 645,674 | 32,638,825 | ||||||||||||
|
|
||||||||||||||||
| Class R |
350,770 | 24,957,283 | 260,276 | 14,710,790 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
2,223,327 | 171,640,821 | 1,884,458 | 114,160,465 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
1,937,551 | 151,167,699 | 1,286,607 | 78,585,952 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
716,260 | 57,059,921 | 420,017 | 25,839,357 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(863,688 | ) | (57,059,921 | ) | (495,251 | ) | (25,839,357 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(4,733,903 | ) | (380,282,691 | ) | (12,799,564 | ) | (752,861,332 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(789,818 | ) | (52,963,735 | ) | (3,064,705 | ) | (150,535,880 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(515,833 | ) | (39,252,062 | ) | (1,283,676 | ) | (73,131,021 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(4,513,933 | ) | (373,834,472 | ) | (18,407,715 | ) | (1,068,009,436 | ) | ||||||||
|
|
||||||||||||||||
| Class R5 |
(0 | ) | (3 | ) | - | - | ||||||||||
|
|
||||||||||||||||
| Class R6 |
(3,109,693 | ) | (260,379,226 | ) | (6,941,434 | ) | (421,821,725 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
9,582,340 | $ | 743,749,510 | (14,826,991 | ) | $ | (804,441,323 | ) | ||||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 35% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
17 Invesco Global Opportunities Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL (5% annual return
before |
|||||||||||||||||||||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Expense Ratio | |||||||||||||||||||||||||
| Class A |
$ | 1,000.00 | $ | 1,297.20 | $ | 5.81 | $ | 1,019.74 | $ | 5.11 | 1.02 | % | ||||||||||||||||||
| Class C |
1,000.00 | 1,292.30 | 10.12 | 1,015.97 | 8.90 | 1.78 | ||||||||||||||||||||||||
| Class R |
1,000.00 | 1,295.40 | 7.28 | 1,018.45 | 6.41 | 1.28 | ||||||||||||||||||||||||
| Class Y |
1,000.00 | 1,298.60 | 4.45 | 1,020.93 | 3.91 | 0.78 | ||||||||||||||||||||||||
| Class R5 |
1,000.00 | 1,299.30 | 3.88 | 1,021.42 | 3.41 | 0.68 | ||||||||||||||||||||||||
| Class R6 |
1,000.00 | 1,299.20 | 3.88 | 1,021.42 | 3.41 | 0.68 | ||||||||||||||||||||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
18 Invesco Global Opportunities Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | O-GLOPP-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders | April 30, 2021 | ||
|
Invesco International Core Equity Fund | ||||
| Nasdaq: | ||||
| A: IBVAX ∎ C: IBVCX ∎ R: IIBRX ∎ Y: IBVYX ∎ Investor: IIBCX ∎ R5: IBVIX ∎ R6: IBVFX | ||||
| 2 |
||||
| 4 |
||||
| 5 |
||||
| 8 |
||||
| 11 |
||||
| 12 |
||||
| 18 |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
| Performance summary |
||||
| Fund vs. Indexes |
||||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
| Class A Shares |
33.20 | % | ||
| Class C Shares |
32.73 | |||
| Class R Shares |
32.94 | |||
| Class Y Shares |
33.40 | |||
| Investor Class Shares |
33.14 | |||
| Class R5 Shares |
33.34 | |||
| Class R6 Shares |
33.34 | |||
| MSCI EAFE Indexq (Broad Market/Style-Specific Index) |
28.84 | |||
| Lipper International Large-Cap Core Funds Index ∎(Peer Group Index) |
32.92 | |||
| Source(s):qRIMES Technologies Corp.; ∎Lipper Inc. |
||||
| The MSCI EAFE® Index is an unmanaged index considered representative of stocks of Europe, Australasia and the Far East. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||
| The Lipper International Large-Cap Core Funds Index is an unmanaged index considered representative of international large-cap core funds tracked by Lipper. |
| |||
| The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
| A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
| |||
|
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends. |
2 Invesco International Core Equity Fund
3 Invesco International Core Equity Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco International Core Equity Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco International Core Equity Fund
Investment Abbreviations:
ADR – American Depositary Receipt
Notes to Schedule of Investments:
| (a) | Non-income producing security. |
| (b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $1,934,656, which represented 2.61% of the Fund’s Net Assets. |
| (c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain |
Value April 30, 2021 |
Dividend Income | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: | ||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class | $ - | $ 6,892,106 | $ (6,769,457 | ) | $- | $- | $122,649 | $ 28 | ||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class | - | 4,594,737 | (4,512,971) | - | - | 81,766 | 7 | |||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Investments Purchased with Cash Collateral from Securities on Loan: | ||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Invesco Private Government Fund | 230,700 | 1,519,515 | (1,597,215) | - | - | 153,000 | 12 | * | ||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Invesco Private Prime Fund | 345,000 | 2,276,992 | (2,392,492) | - | - | 229,500 | 116 | * | ||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| Total |
$575,700 | $15,283,350 | $(15,272,135 | ) | $- | $- | $586,915 | $163 | ||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
| * | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| (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 1I. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco International Core Equity Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Industrials |
17.52 | % | ||
| Consumer Discretionary |
16.75 | |||
| Financials |
15.11 | |||
| Health Care |
11.41 | |||
| Consumer Staples |
7.49 | |||
| Energy |
6.63 | |||
| Utilities |
6.41 | |||
| Information Technology |
6.14 | |||
| Communication Services |
5.84 | |||
| Materials |
5.62 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
1.08 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco International Core Equity Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco International Core Equity Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $81,461) |
$ | 721,863 | ||
|
|
||||
| Non-cash dividend income |
76,731 | |||
|
|
||||
| Dividends from affiliated money market funds (includes securities lending income of $366) |
401 | |||
|
|
||||
| Total investment income |
798,995 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
259,902 | |||
|
|
||||
| Administrative services fees |
4,317 | |||
|
|
||||
| Custodian fees |
7,797 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
37,680 | |||
|
|
||||
| Class C |
9,991 | |||
|
|
||||
| Class R |
4,139 | |||
|
|
||||
| Investor Class |
12,126 | |||
|
|
||||
| Transfer agent fees – A, C, R, Y and Investor |
76,760 | |||
|
|
||||
| Transfer agent fees – R5 |
35 | |||
|
|
||||
| Transfer agent fees – R6 |
86 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
12,341 | |||
|
|
||||
| Registration and filing fees |
41,949 | |||
|
|
||||
| Reports to shareholders |
12,322 | |||
|
|
||||
| Professional services fees |
15,464 | |||
|
|
||||
| Other |
13,358 | |||
|
|
||||
| Total expenses |
508,267 | |||
|
|
||||
| Less: Fees waived, expenses reimbursed and/or expense offset arrangement(s) |
(142,942 | ) | ||
|
|
||||
| Net expenses |
365,325 | |||
|
|
||||
| Net investment income |
433,670 | |||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
8,658,771 | |||
|
|
||||
| Foreign currencies |
(790 | ) | ||
|
|
||||
| 8,657,981 | ||||
|
|
||||
| Change in net unrealized appreciation (depreciation) of: |
||||
| Unaffiliated investment securities (net of foreign taxes of $16,177) |
9,308,851 | |||
|
|
||||
| Foreign currencies |
(466 | ) | ||
|
|
||||
| 9,308,385 | ||||
|
|
||||
| Net realized and unrealized gain |
17,966,366 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 18,400,036 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco International Core Equity Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income |
$ | 433,670 | $ | 721,364 | ||||
|
|
||||||||
| Net realized gain (loss) |
8,657,981 | (5,663,264 | ) | |||||
|
|
||||||||
| Change in net unrealized appreciation |
9,308,385 | 4,365,282 | ||||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from operations |
18,400,036 | (576,618 | ) | |||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(262,403 | ) | (595,374 | ) | ||||
|
|
||||||||
| Class C |
(2,288 | ) | (35,022 | ) | ||||
|
|
||||||||
| Class R |
(10,609 | ) | (23,237 | ) | ||||
|
|
||||||||
| Class Y |
(59,408 | ) | (110,748 | ) | ||||
|
|
||||||||
| Investor Class |
(83,908 | ) | (187,346 | ) | ||||
|
|
||||||||
| Class R5 |
(45,382 | ) | (80,744 | ) | ||||
|
|
||||||||
| Class R6 |
(171,257 | ) | (468,107 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(635,255 | ) | (1,500,578 | ) | ||||
|
|
||||||||
| Share transactions-net: |
||||||||
| Class A |
155,451 | (2,730,222 | ) | |||||
|
|
||||||||
| Class C |
(467,013 | ) | (913,796 | ) | ||||
|
|
||||||||
| Class R |
15,411 | 260,135 | ||||||
|
|
||||||||
| Class Y |
1,208,983 | 85,849 | ||||||
|
|
||||||||
| Investor Class |
(298,020 | ) | (908,558 | ) | ||||
|
|
||||||||
| Class R5 |
30,440 | 78,941 | ||||||
|
|
||||||||
| Class R6 |
174,192 | (5,523,012 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
819,444 | (9,650,663 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets |
18,584,225 | (11,727,859 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
55,680,804 | 67,408,663 | ||||||
|
|
||||||||
| End of period |
$ | 74,265,029 | $ | 55,680,804 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco International Core Equity Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment |
Net gains realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized |
Total distributions |
Net asset of period |
Total return (b) |
Net assets, (000’s omitted) |
Ratio of net assets |
Ratio
of fee waivers |
Ratio of net investment to
average |
Portfolio turnover (c) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$10.53 | $0.08 | $3.40 | $3.48 | $(0.11 | ) | $ – | $(0.11 | ) | $13.90 | 33.20 | % | $32,379 | 1.12 | %(d) | 1.62 | %(d) | 1.19 | %(d) | 61 | % | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.66 | 0.12 | (0.02 | ) | 0.10 | (0.23 | ) | – | (0.23 | ) | 10.53 | 0.86 | 24,443 | 1.12 | 1.68 | 1.13 | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.59 | 0.20 | 0.71 | 0.91 | (0.15 | ) | (0.69 | ) | (0.84 | ) | 10.66 | 9.74 | 27,707 | 1.12 | 1.66 | 1.97 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.43 | 0.19 | (1.84 | ) | (1.65 | ) | (0.19 | ) | – | (0.19 | ) | 10.59 | (13.53 | ) | 33,798 | 1.12 | 1.67 | 1.54 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.48 | 0.15 | 1.97 | 2.12 | (0.17 | ) | – | (0.17 | ) | 12.43 | 20.54 | 40,865 | 1.15 | 1.70 | 1.38 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.73 | 0.12 | (0.26 | ) | (0.14 | ) | (0.11 | ) | – | (0.11 | ) | 10.48 | (1.26 | ) | 35,406 | 1.41 | 1.61 | 1.18 | 37 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.28 | 0.03 | 3.33 | 3.36 | (0.01 | ) | – | (0.01 | ) | 13.63 | 32.73 | 1,923 | 1.87 | (d) | 2.37 | (d) | 0.44 | (d) | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.40 | 0.04 | (0.03 | ) | 0.01 | (0.13 | ) | – | (0.13 | ) | 10.28 | 0.06 | 1,827 | 1.87 | 2.43 | 0.38 | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.31 | 0.12 | 0.71 | 0.83 | (0.05 | ) | (0.69 | ) | (0.74 | ) | 10.40 | 8.98 | 2,775 | 1.87 | 2.41 | 1.22 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.10 | 0.09 | (1.79 | ) | (1.70 | ) | (0.09 | ) | – | (0.09 | ) | 10.31 | (14.14 | ) | 6,022 | 1.87 | 2.42 | 0.79 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.20 | 0.07 | 1.92 | 1.99 | (0.09 | ) | – | (0.09 | ) | 12.10 | 19.64 | 8,476 | 1.90 | 2.45 | 0.63 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.44 | 0.04 | (0.26 | ) | (0.22 | ) | (0.02 | ) | – | (0.02 | ) | 10.20 | (2.06 | ) | 8,581 | 2.16 | 2.36 | 0.43 | 37 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.57 | 0.06 | 3.42 | 3.48 | (0.08 | ) | – | (0.08 | ) | 13.97 | 33.04 | 1,776 | 1.37 | (d) | 1.87 | (d) | 0.94 | (d) | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.69 | 0.09 | (0.01 | ) | 0.08 | (0.20 | ) | – | (0.20 | ) | 10.57 | 0.67 | 1,329 | 1.37 | 1.93 | 0.88 | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.60 | 0.17 | 0.73 | 0.90 | (0.12 | ) | (0.69 | ) | (0.81 | ) | 10.69 | 9.52 | 1,105 | 1.37 | 1.91 | 1.72 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.44 | 0.16 | (1.84 | ) | (1.68 | ) | (0.16 | ) | – | (0.16 | ) | 10.60 | (13.73 | ) | 1,414 | 1.37 | 1.92 | 1.29 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.49 | 0.12 | 1.97 | 2.09 | (0.14 | ) | – | (0.14 | ) | 12.44 | 20.21 | 2,201 | 1.40 | 1.95 | 1.13 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.74 | 0.09 | (0.26 | ) | (0.17 | ) | (0.08 | ) | – | (0.08 | ) | 10.49 | (1.54 | ) | 2,180 | 1.66 | 1.86 | 0.93 | 37 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.74 | 0.10 | 3.47 | 3.57 | (0.14 | ) | – | (0.14 | ) | 14.17 | 33.40 | 7,029 | 0.87 | (d) | 1.37 | (d) | 1.44 | (d) | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.87 | 0.14 | (0.01 | ) | 0.13 | (0.26 | ) | – | (0.26 | ) | 10.74 | 1.11 | 4,407 | 0.87 | 1.43 | 1.38 | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.78 | 0.23 | 0.73 | 0.96 | (0.18 | ) | (0.69 | ) | (0.87 | ) | 10.87 | 10.09 | 4,465 | 0.87 | 1.41 | 2.22 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.65 | 0.22 | (1.87 | ) | (1.65 | ) | (0.22 | ) | – | (0.22 | ) | 10.78 | (13.33 | ) | 5,738 | 0.87 | 1.42 | 1.79 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.66 | 0.19 | 2.00 | 2.19 | (0.20 | ) | – | (0.20 | ) | 12.65 | 20.88 | 6,226 | 0.90 | 1.45 | 1.63 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.92 | 0.15 | (0.27 | ) | (0.12 | ) | (0.14 | ) | – | (0.14 | ) | 10.66 | (1.06 | ) | 3,431 | 1.16 | 1.36 | 1.43 | 37 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Investor Class |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.73 | 0.08 | 3.46 | 3.54 | (0.11 | ) | – | (0.11 | ) | 14.16 | 33.14 | 10,066 | 1.12 | (d) | 1.62 | (d) | 1.19 | (d) | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.85 | 0.12 | (0.01 | ) | 0.11 | (0.23 | ) | – | (0.23 | ) | 10.73 | 0.94 | 7,848 | 1.12 | 1.68 | 1.13 | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.76 | 0.20 | 0.73 | 0.93 | (0.15 | ) | (0.69 | ) | (0.84 | ) | 10.85 | 9.77 | 8,886 | 1.12 | 1.66 | 1.97 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.63 | 0.19 | (1.87 | ) | (1.68 | ) | (0.19 | ) | – | (0.19 | ) | 10.76 | (13.55 | ) | 9,037 | 1.12 | 1.67 | 1.54 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.65 | 0.16 | 1.99 | 2.15 | (0.17 | ) | – | (0.17 | ) | 12.63 | 20.50 | 14,503 | 1.15 | 1.70 | 1.38 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.90 | 0.12 | (0.26 | ) | (0.14 | ) | (0.11 | ) | – | (0.11 | ) | 10.65 | (1.24 | ) | 10,280 | 1.41 | 1.61 | 1.18 | 37 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.46 | 0.09 | 3.38 | 3.47 | (0.14 | ) | – | (0.14 | ) | 13.79 | 33.34 | 4,408 | 0.87 | (d) | 1.06 | (d) | 1.44 | (d) | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.59 | 0.14 | (0.01 | ) | 0.13 | (0.26 | ) | – | (0.26 | ) | 10.46 | 1.14 | 3,318 | 0.87 | 1.12 | 1.38 | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.53 | 0.22 | 0.71 | 0.93 | (0.18 | ) | (0.69 | ) | (0.87 | ) | 10.59 | 10.04 | 3,282 | 0.87 | 1.10 | 2.22 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.36 | 0.22 | (1.83 | ) | (1.61 | ) | (0.22 | ) | – | (0.22 | ) | 10.53 | (13.32 | ) | 3,017 | 0.87 | 1.15 | 1.79 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.44 | 0.18 | 1.95 | 2.13 | (0.21 | ) | – | (0.21 | ) | 12.36 | 20.82 | 3,474 | 0.90 | 1.15 | 1.63 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.71 | 0.16 | (0.26 | ) | (0.10 | ) | (0.17 | ) | – | (0.17 | ) | 10.44 | (0.83 | ) | 2,832 | 1.03 | 1.04 | 1.56 | 37 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
10.46 | 0.09 | 3.38 | 3.47 | (0.14 | ) | – | (0.14 | ) | 13.79 | 33.34 | 16,683 | 0.87 | (d) | 1.06 | (d) | 1.44 | (d) | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
10.59 | 0.14 | (0.01 | ) | 0.13 | (0.26 | ) | – | (0.26 | ) | 10.46 | 1.14 | 12,508 | 0.87 | 1.12 | 1.38 | 61 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.53 | 0.22 | 0.71 | 0.93 | (0.18 | ) | (0.69 | ) | (0.87 | ) | 10.59 | 10.04 | 19,188 | 0.87 | 1.10 | 2.22 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.35 | 0.22 | (1.82 | ) | (1.60 | ) | (0.22 | ) | – | (0.22 | ) | 10.53 | (13.25 | ) | 11,560 | 0.87 | 1.15 | 1.79 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.43 | 0.18 | 1.96 | 2.14 | (0.22 | ) | – | (0.22 | ) | 12.35 | 20.85 | 15,702 | 0.90 | 1.15 | 1.63 | 61 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
10.71 | 0.16 | (0.27 | ) | (0.11 | ) | (0.17 | ) | – | (0.17 | ) | 10.43 | (0.91 | ) | 26,480 | 1.02 | 1.03 | 1.57 | 37 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $30,394, $2,015, $1,669, $6,066, $9,782, $4,175 and $15,782 for Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares, respectively. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco International Core Equity Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco International Core Equity Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of seven different classes of shares: Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6. Class Y and Investor Class shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Investor Class, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services - Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 Invesco International Core Equity Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy 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. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the 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. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. 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. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The 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 Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
| J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 Invesco International Core Equity Fund
| foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| L. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets | Rate | |||
|
|
||||
| First $500 million |
0.750% | |||
|
|
||||
| Next $500 million |
0.650% | |||
|
|
||||
| From $1 billion |
0.550% | |||
|
|
||||
| From $2 billion |
0.450% | |||
|
|
||||
| From $4 billion |
0.400% | |||
|
|
||||
| From $6 billion |
0.375% | |||
|
|
||||
| Over $8 billion |
0.350% | |||
|
|
||||
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.75%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares to 1.12%, 1.87%, 1.37%, 0.87%, 1.12%, 0.87% and 0.87%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limit, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
The Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $65,800 and reimbursed class level expenses of $46,731, $3,098, $2,566, $9,326, $15,040, $35 and $86 of Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
14 Invesco International Core Equity Fund
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C, Class R and Investor Class shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares, 0.50% of the average daily net assets of Class R shares and 0.25% of the average daily net assets of Investor Class shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $2,811 in front-end sales commissions from the sale of Class A shares and $0 and $52 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $289 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
| Investments in Securities |
|||||||||||||||||
| Argentina |
$ | 516,852 | $ | – | $ | – | $ 516,852 | ||||||||||
| Australia |
– | 4,755,344 | – | 4,755,344 | |||||||||||||
| Austria |
– | 1,648,038 | – | 1,648,038 | |||||||||||||
| Belgium |
– | 1,743,907 | – | 1,743,907 | |||||||||||||
| Brazil |
– | 632,922 | – | 632,922 | |||||||||||||
| Canada |
1,268,967 | – | – | 1,268,967 | |||||||||||||
| China |
2,009,079 | – | – | 2,009,079 | |||||||||||||
| Denmark |
– | 612,920 | – | 612,920 | |||||||||||||
| Finland |
– | 454,723 | – | 454,723 | |||||||||||||
| France |
– | 6,483,734 | – | 6,483,734 | |||||||||||||
| Germany |
– | 6,734,604 | – | 6,734,604 | |||||||||||||
| Hong Kong |
– | 1,383,106 | – | 1,383,106 | |||||||||||||
| India |
703,090 | 983,860 | – | 1,686,950 | |||||||||||||
| Italy |
– | 1,191,992 | – | 1,191,992 | |||||||||||||
| Japan |
– | 11,934,513 | – | 11,934,513 | |||||||||||||
| Netherlands |
– | 5,964,989 | – | 5,964,989 | |||||||||||||
| Singapore |
– | 1,209,039 | – | 1,209,039 | |||||||||||||
| South Korea |
– | 1,007,229 | – | 1,007,229 | |||||||||||||
| Spain |
538,655 | 3,797,508 | – | 4,336,163 | |||||||||||||
| Sweden |
– | 2,653,358 | – | 2,653,358 | |||||||||||||
| Switzerland |
1,079,565 | 4,321,473 | – | 5,401,038 | |||||||||||||
| United Kingdom |
– | 8,999,611 | – | 8,999,611 | |||||||||||||
| United States |
– | 833,318 | – | 833,318 | |||||||||||||
| Money Market Funds |
204,415 | 382,500 | – | 586,915 | |||||||||||||
| Total Investments |
$ | 6,320,623 | $ | 67,728,688 | $ | – | $74,049,311 | ||||||||||
15 Invesco International Core Equity Fund
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $260.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2020, as follows:
| Capital Loss Carryforward* | ||||||||||||
| Expiration | Short-Term | Long-Term | Total | |||||||||
| Not subject to expiration |
$– | $9,348,271 | $9,348,271 | |||||||||
| * | Capital loss carryforward 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
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $41,312,506 and $41,550,558, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 13,941,522 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(606,649 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 13,334,873 | ||
|
|
||||
Cost of investments for tax purposes is $60,714,438.
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
|
|
|
|
|
|||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
157,157 | $ | 2,136,801 | 184,539 | $ | 1,890,072 | ||||||||||
|
|
||||||||||||||||
| Class C |
49,437 | 629,404 | 31,411 | 310,780 | ||||||||||||
|
|
||||||||||||||||
| Class R |
15,189 | 201,862 | 47,193 | 498,094 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
187,353 | 2,597,590 | 160,486 | 1,685,967 | ||||||||||||
|
|
||||||||||||||||
| Investor Class |
12,107 | 160,604 | 24,356 | 260,480 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
112 | 1,511 | 296 | 2,911 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
1,402 | 18,622 | 682 | 7,326 | ||||||||||||
|
|
||||||||||||||||
16 Invesco International Core Equity Fund
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
|
|
|
|
|
|||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
19,390 | $ | 245,478 | 50,386 | $ | 553,747 | ||||||||||
|
|
||||||||||||||||
| Class C |
179 | 2,231 | 3,122 | 33,715 | ||||||||||||
|
|
||||||||||||||||
| Class R |
833 | 10,604 | 2,103 | 23,237 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
4,367 | 56,287 | 9,061 | 101,302 | ||||||||||||
|
|
||||||||||||||||
| Investor Class |
6,234 | 80,414 | 16,321 | 182,631 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
3,615 | 45,375 | 7,413 | 80,731 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
13,657 | 171,257 | 42,985 | 468,107 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
29,782 | 382,995 | 24,578 | 255,644 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(30,327 | ) | (382,995 | ) | (25,107 | ) | (255,644 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(197,938 | ) | (2,609,823 | ) | (538,063 | ) | (5,429,685 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(55,885 | ) | (715,653 | ) | (98,659 | ) | (1,002,647 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(14,579 | ) | (197,055 | ) | (26,905 | ) | (261,196 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(105,853 | ) | (1,444,894 | ) | (170,187 | ) | (1,701,420 | ) | ||||||||
|
|
||||||||||||||||
| Investor Class |
(39,150 | ) | (539,038 | ) | (127,867 | ) | (1,351,669 | ) | ||||||||
|
|
||||||||||||||||
| Class R5 |
(1,318 | ) | (16,446 | ) | (423 | ) | (4,701 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(1,174 | ) | (15,687 | ) | (659,879 | ) | (5,998,445 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
54,590 | $ | 819,444 | (1,042,158 | ) | $ | (9,650,663 | ) | ||||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 30% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 6% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser.
17 Invesco International Core Equity Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| HYPOTHETICAL | ||||||||||||
| (5% annual return before | ||||||||||||
| ACTUAL | expenses) | |||||||||||
| Beginning | Ending | Expenses | Ending | Expenses | Annualized | |||||||
| Account Value | Account Value | Paid During | Account Value | Paid During | Expense | |||||||
| (11/01/20) | (04/30/21)1 | Period2 | (04/30/21) | Period2 | Ratio | |||||||
|
Class A |
$1,000.00 | $1,332.00 | $6.48 | $1,019.24 | $5.61 | 1.12% | ||||||
|
Class C |
1,000.00 | 1,327.30 | 10.79 | 1,015.52 | 9.35 | 1.87 | ||||||
|
Class R |
1,000.00 | 1,329.40 | 7.91 | 1,018.00 | 6.85 | 1.37 | ||||||
|
Class Y |
1,000.00 | 1,334.00 | 5.03 | 1,020.48 | 4.36 | 0.87 | ||||||
|
Investor Class |
1,000.00 | 1,331.40 | 6.47 | 1,019.24 | 5.61 | 1.12 | ||||||
|
Class R5 |
1,000.00 | 1,333.40 | 5.03 | 1,020.48 | 4.36 | 0.87 | ||||||
|
Class R6 |
1,000.00 | 1,333.40 | 5.03 | 1,020.48 | 4.36 | 0.87 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
18 Invesco International Core Equity Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | I-ICE-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders
|
April 30, 2021
| ||
|
| ||||
| Invesco International Equity Fund | ||||
|
Nasdaq: |
||||
| A: QIVAX ∎ C: QIVCX ∎ R: QIVNX ∎ Y: QIVYX ∎ R5: INEQX ∎ R6: QIVIX | ||||
| 2 | Fund Performance | |||
| 4 | Liquidity Risk Management Program | |||
| 5 | Schedule of Investments | |||
| 7 | Financial Statements | |||
| 10 | Financial Highlights | |||
| 11 | Notes to Financial Statements | |||
| 16 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
|
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
| Performance summary |
| |||
| Fund vs. Indexes |
| |||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
| Class A Shares |
22.32 | % | ||
| Class C Shares |
21.90 | |||
| Class R Shares |
22.22 | |||
| Class Y Shares |
22.59 | |||
| Class R5 Shares |
22.60 | |||
| Class R6 Shares |
22.59 | |||
| MSCI All Country World ex USA Index▼ |
27.40 | |||
| Source(s): ▼RIMES Technologies Corp. |
||||
| The MSCI All Country World ex USA® Index is an index considered representative of developed and emerging stock markets, excluding the US. The index is computed using the net return, which withholds applicable taxes for non-resident investors. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
||||
|
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their in-sights about market and economic news and trends. |
2 Invesco International Equity Fund
3 Invesco International Equity Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco International Equity Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco International Equity Fund
Investment Abbreviations:
ADR – American Depositary Receipt
CDI – CREST Depository Interest
Wts. – Warrants
Notes to Schedule of Investments:
| (a) | Non-income producing security. |
| (b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $23,590,174, which represented 1.53% of the Fund’s Net Assets. |
| (c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: |
|
||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$25,030,837 | $ | 157,831,845 | $ | (160,579,813 | ) | $ - | $ - | $ | 22,282,869 | $1,431 | ||||||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
17,877,708 | 112,737,032 | (114,698,991 | ) | 1,074 | (902) | 15,915,921 | 1,354 | |||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
28,606,671 | 180,379,251 | (183,519,786 | ) | - | - | 25,466,136 | 638 | |||||||||||||||||||||||||||
| Total |
$71,515,216 | $ | 450,948,128 | $ | (458,798,590 | ) | $1,074 | $(902) | $ | 63,664,926 | $3,423 | ||||||||||||||||||||||||
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Consumer Discretionary |
21.52 | % | ||
| Information Technology |
19.75 | |||
| Industrials |
13.25 | |||
| Materials |
10.98 | |||
| Financials |
9.00 | |||
| Communication Services |
6.48 | |||
| Consumer Staples |
5.92 | |||
| Health Care |
5.25 | |||
| Energy |
2.16 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
5.69 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco International Equity Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco International Equity Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $1,593,479) |
$ | 13,617,504 | ||
|
|
||||
| Dividends from affiliated money market funds |
3,423 | |||
|
|
||||
| Total investment income |
13,620,927 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
5,682,572 | |||
|
|
||||
| Administrative services fees |
108,861 | |||
|
|
||||
| Custodian fees |
64,592 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
240,735 | |||
|
|
||||
| Class C |
78,296 | |||
|
|
||||
| Class R |
60,911 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
343,258 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
10,959 | |||
|
|
||||
| Registration and filing fees |
58,748 | |||
|
|
||||
| Reports to shareholders |
31,241 | |||
|
|
||||
| Professional services fees |
27,360 | |||
|
|
||||
| Other |
17,374 | |||
|
|
||||
| Total expenses |
6,724,907 | |||
|
|
||||
| Less: Fees waived, expenses reimbursed and/or expense offset arrangement(s) |
(111,826 | ) | ||
|
|
||||
| Net expenses |
6,613,081 | |||
|
|
||||
| Net investment income |
7,007,846 | |||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
|
|
||||
| Unaffiliated investment securities |
209,951,218 | |||
|
|
||||
| Affiliated investment securities |
(902 | ) | ||
|
|
||||
| Foreign currencies |
(172,707 | ) | ||
|
|
||||
| 209,777,609 | ||||
|
|
||||
| Change in net unrealized appreciation of: |
||||
| Unaffiliated investment securities |
79,019,657 | |||
|
|
||||
| Affiliated investment securities |
1,074 | |||
|
|
||||
| Foreign currencies |
88,958 | |||
|
|
||||
| 79,109,689 | ||||
|
|
||||
| Net realized and unrealized gain |
288,887,298 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 295,895,144 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco International Equity Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income |
$ | 7,007,846 | $ | 11,969,422 | ||||
|
|
||||||||
| Net realized gain |
209,777,609 | 35,333,021 | ||||||
|
|
||||||||
| Change in net unrealized appreciation |
79,109,689 | 51,177,632 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
295,895,144 | 98,480,075 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(892,289 | ) | (2,775,282 | ) | ||||
|
|
||||||||
| Class C |
– | (169,926 | ) | |||||
|
|
||||||||
| Class R |
(65,532 | ) | (265,548 | ) | ||||
|
|
||||||||
| Class Y |
(717,019 | ) | (1,354,131 | ) | ||||
|
|
||||||||
| Class R5 |
(112 | ) | (208 | ) | ||||
|
|
||||||||
| Class R6 |
(10,102,777 | ) | (29,039,080 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(11,777,729 | ) | (33,604,175 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
(8,959,440 | ) | (20,472,900 | ) | ||||
|
|
||||||||
| Class C |
(3,789,885 | ) | (5,550,925 | ) | ||||
|
|
||||||||
| Class R |
414,314 | (316,461 | ) | |||||
|
|
||||||||
| Class Y |
11,368,110 | (1,192,937 | ) | |||||
|
|
||||||||
| Class R6 |
(71,810,052 | ) | (518,104,676 | ) | ||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
(72,776,953 | ) | (545,637,899 | ) | ||||
|
|
||||||||
| Net increase (decrease) in net assets |
211,340,462 | (480,761,999 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
1,332,031,367 | 1,812,793,366 | ||||||
|
|
||||||||
| End of period |
$ | 1,543,371,829 | $ | 1,332,031,367 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco International Equity Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains on securities |
Total from investment operations |
Dividends from net investment income |
Net asset value, end of period |
Total return (b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average net assets with fee waivers and/or expenses absorbed |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed(c) |
Ratio of net to average |
Portfolio turnover (d) | |||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 21.86 | $ | 0.07 | $ | 4.80 | $ | 4.87 | $ | (0.12 | ) | $ | 26.61 | 22.32 | % | $ | 196,044 | 1.23 | %(e) | 1.25 | %(e) | 0.57 | %(e) | 52 | % | |||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
20.82 | 0.08 | 1.28 | 1.36 | (0.32 | ) | 21.86 | 6.57 | 168,596 | 1.23 | 1.28 | 0.39 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
19.44 | 0.31 | 1.29 | 1.60 | (0.22 | ) | 20.82 | 8.38 | 181,695 | 1.22 | (f) | 1.24 | (f) | 1.69 | (f) | 54 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
22.23 | 0.27 | (3.06 | ) | (2.79 | ) | (0.00 | ) | 19.44 | (12.55 | ) | 189,130 | 1.23 | 1.24 | 1.23 | 85 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
17.40 | 0.18 | 5.00 | 5.18 | (0.35 | ) | 22.23 | 30.33 | 222,358 | 1.27 | 1.28 | 0.92 | 83 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
17.56 | 0.25 | (0.31 | ) | (0.06 | ) | (0.10 | ) | 17.40 | (0.31 | ) | 166,493 | 1.31 | 1.32 | 1.43 | 79 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
18.39 | 0.11 | (0.60 | ) | (0.49 | ) | (0.34 | ) | 17.56 | (2.60 | ) | 169,107 | 1.30 | 1.30 | 0.59 | 79 | ||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
19.36 | (0.02 | ) | 4.26 | 4.24 | - | 23.60 | 21.90 | 14,509 | 1.98 | (e) | 2.00 | (e) | (0.18 | )(e) | 52 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
18.45 | (0.07 | ) | 1.14 | 1.07 | (0.16 | ) | 19.36 | 5.81 | 15,113 | 1.98 | 2.03 | (0.36 | ) | 69 | |||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
17.23 | 0.15 | 1.15 | 1.30 | (0.08 | ) | 18.45 | 7.59 | 20,057 | 1.98 | (f) | 1.99 | (f) | 0.93 | (f) | 54 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
19.84 | 0.09 | (2.70 | ) | (2.61 | ) | - | 17.23 | (13.20 | ) | 34,738 | 1.98 | 1.99 | 0.48 | 85 | |||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
15.56 | 0.03 | 4.47 | 4.50 | (0.22 | ) | 19.84 | 29.42 | 40,178 | 2.03 | 2.04 | 0.19 | 83 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
15.73 | 0.10 | (0.27 | ) | (0.17 | ) | - | 15.56 | (1.08 | ) | 30,895 | 2.07 | 2.08 | 0.66 | 79 | |||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
16.51 | (0.03 | ) | (0.53 | ) | (0.56 | ) | (0.22 | ) | 15.73 | (3.34 | ) | 35,938 | 2.06 | 2.06 | (0.17 | ) | 79 | ||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
21.53 | 0.04 | 4.74 | 4.78 | (0.07 | ) | 26.24 | 22.22 | 25,545 | 1.48 | (e) | 1.50 | (e) | 0.32 | (e) | 52 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
20.52 | 0.03 | 1.25 | 1.28 | (0.27 | ) | 21.53 | 6.27 | 20,619 | 1.48 | 1.53 | 0.14 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
19.18 | 0.26 | 1.27 | 1.53 | (0.19 | ) | 20.52 | 8.10 | 20,044 | 1.47 | (f) | 1.49 | (f) | 1.44 | (f) | 54 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
21.98 | 0.21 | (3.01 | ) | (2.80 | ) | - | 19.18 | (12.74 | ) | 17,112 | 1.48 | 1.49 | 0.98 | 85 | |||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
17.21 | 0.13 | 4.94 | 5.07 | (0.30 | ) | 21.98 | 29.99 | 13,223 | 1.52 | 1.53 | 0.65 | 83 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
17.37 | 0.20 | (0.30 | ) | (0.10 | ) | (0.06 | ) | 17.21 | (0.55 | ) | 8,410 | 1.56 | 1.57 | 1.18 | 79 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
18.20 | 0.06 | (0.59 | ) | (0.53 | ) | (0.30 | ) | 17.37 | (2.89 | ) | 8,098 | 1.56 | 1.56 | 0.33 | 79 | ||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
22.10 | 0.12 | 4.85 | 4.97 | (0.20 | ) | 26.87 | 22.59 | 103,966 | 0.85 | (e) | 1.00 | (e) | 0.95 | (e) | 52 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
21.04 | 0.16 | 1.29 | 1.45 | (0.39 | ) | 22.10 | 6.94 | 75,777 | 0.85 | 1.03 | 0.77 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
19.67 | 0.38 | 1.30 | 1.68 | (0.31 | ) | 21.04 | 8.73 | 74,540 | 0.84 | (f) | 0.99 | (f) | 2.06 | (f) | 54 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
22.46 | 0.35 | (3.07 | ) | (2.72 | ) | (0.07 | ) | 19.67 | (12.16 | ) | 138,750 | 0.85 | 1.00 | 1.63 | 85 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
17.59 | 0.21 | 5.06 | 5.27 | (0.40 | ) | 22.46 | 30.63 | 57,166 | 1.02 | 1.03 | 1.01 | 83 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
17.75 | 0.27 | (0.28 | ) | (0.01 | ) | (0.15 | ) | 17.59 | (0.03 | ) | 15,965 | 1.06 | 1.07 | 1.54 | 79 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
18.59 | 0.15 | (0.60 | ) | (0.45 | ) | (0.39 | ) | 17.75 | (2.37 | ) | 10,789 | 1.06 | 1.06 | 0.84 | 79 | ||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
21.92 | 0.13 | 4.81 | 4.94 | (0.22 | ) | 26.64 | 22.60 | 14 | 0.79 | (e) | 0.79 | (e) | 1.01 | (e) | 52 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
20.86 | 0.17 | 1.29 | 1.46 | (0.40 | ) | 21.92 | 7.04 | 11 | 0.79 | 0.79 | 0.83 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/19(g) |
19.31 | 0.18 | 1.37 | 1.55 | - | 20.86 | 8.03 | 11 | 0.82 | (f) | 0.82 | (f) | 2.09 | (f) | 54 | |||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
21.80 | 0.13 | 4.78 | 4.91 | (0.22 | ) | 26.49 | 22.59 | 1,203,294 | 0.79 | (e) | 0.79 | (e) | 1.01 | (e) | 52 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
20.75 | 0.17 | 1.28 | 1.45 | (0.40 | ) | 21.80 | 7.04 | 1,051,915 | 0.79 | 0.79 | 0.83 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
19.40 | 0.38 | 1.29 | 1.67 | (0.32 | ) | 20.75 | 8.77 | 1,516,446 | 0.79 | (f) | 0.80 | (f) | 2.11 | (f) | 54 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
22.17 | 0.35 | (3.03 | ) | (2.68 | ) | (0.09 | ) | 19.40 | (12.20 | ) | 1,566,488 | 0.81 | 0.82 | 1.65 | 85 | ||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
17.36 | 0.23 | 5.01 | 5.24 | (0.43 | ) | 22.17 | 30.96 | 1,505,578 | 0.83 | 0.83 | 1.17 | 83 | |||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
17.53 | 0.32 | (0.30 | ) | 0.02 | (0.19 | ) | 17.36 | 0.11 | 689,409 | 0.86 | 0.87 | 1.85 | 79 | ||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
18.37 | 0.19 | (0.60 | ) | (0.41 | ) | (0.43 | ) | 17.53 | (2.16 | ) | 716,793 | 0.86 | 0.86 | 1.03 | 79 | ||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Does not include indirect expenses from affiliated fund fees and expenses of 0.01%, 0.01%, 0.00%, 0.01% and 0.01% for the eleven months ended October 31, 2019 and the years ended November 30, 2018, 2017, 2016 and 2015, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $194,184, $15,789, $24,566, $95,234, $13 and $1,195,764 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (f) | Annualized. |
| (g) | Commencement date after the close of business on May 24, 2019. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco International Equity Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco International Equity Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations –Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
11 Invesco International Equity Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. |
Therefore, no provision for federal income taxes is recorded in the financial statements.
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk.
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
12 Invesco International Equity Fund
forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| K. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
| L. | Other Risks - Emerging markets (also referred to as developing markets) are generally subject to greater market volatility, political, social and economic instability, uncertainty regarding the existence of trading markets and more governmental limitations on foreign investment than more developed markets. In addition, companies operating in emerging markets may be subject to lower trading volume and greater price fluctuations than companies in more developed markets. Securities law in many emerging market countries is relatively new and unsettled. Therefore, laws regarding foreign investment in emerging market securities, securities regulation, title to securities, and shareholder rights may change quickly and unpredictably. In addition, the enforcement of systems of taxation at federal, regional and local levels in emerging market countries may be inconsistent, and subject to sudden change. Other risks of investing in emerging markets securities may include additional transaction costs, delays in settlement procedures, and lack of timely information. |
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets* | Rate | |||
| First $ 500 million |
0.850 | % | ||
| Next $500 million |
0.750 | % | ||
| Next $1 billion |
0.700 | % | ||
| Next $3 billion |
0.670 | % | ||
| Over $5 billion |
0.650 | % | ||
| * | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.75%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through at least February 28, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.23%, 1.98%, 1.48%, 0.85%, 0.85% and 0.80%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $12,250 and reimbursed class level expenses of $21,772, $1,717, $2,773, $72,389, $0 and $0 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $10,192 in front-end sales commissions from the sale of Class A shares and $0 and $113 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
13 Invesco International Equity Fund
For the six months ended April 30, 2021, the Fund incurred $31,057 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||
| Investments in Securities |
||||||||||||||
| Australia |
$ | 22,226,870 | $ | – | $– | $ | 22,226,870 | |||||||
| China |
99,090,256 | 42,754,152 | – | 141,844,408 | ||||||||||
| Denmark |
– | 43,777,377 | – | 43,777,377 | ||||||||||
| France |
– | 144,315,511 | – | 144,315,511 | ||||||||||
| Germany |
– | 179,537,929 | – | 179,537,929 | ||||||||||
| Japan |
– | 285,622,809 | – | 285,622,809 | ||||||||||
| Macau |
– | 21,331,634 | – | 21,331,634 | ||||||||||
| Netherlands |
19,165,525 | 51,917,584 | – | 71,083,109 | ||||||||||
| New Zealand |
– | 15,236,100 | – | 15,236,100 | ||||||||||
| Singapore |
– | 14,723,112 | – | 14,723,112 | ||||||||||
| South Africa |
– | 51,648,595 | – | 51,648,595 | ||||||||||
| South Korea |
– | 107,605,421 | – | 107,605,421 | ||||||||||
| Spain |
– | 15,307,844 | – | 15,307,844 | ||||||||||
| Switzerland |
21,362,226 | 77,307,296 | – | 98,669,522 | ||||||||||
| Taiwan |
– | 9,987,528 | – | 9,987,528 | ||||||||||
| Thailand |
8,268,941 | – | – | 8,268,941 | ||||||||||
| United Kingdom |
25,956,699 | 106,208,869 | – | 132,165,568 | ||||||||||
| United States |
75,960,049 | 16,242,115 | – | 92,202,164 | ||||||||||
| Money Market Funds |
63,664,926 | – | – | 63,664,926 | ||||||||||
| Total Investments |
$ | 335,695,492 | $ | 1,183,523,876 | $– | $ | 1,519,219,368 | |||||||
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $925.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
14 Invesco International Equity Fund
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2020, as follows:
| Capital Loss Carryforward* | ||||||||||||
| Expiration | Short-Term | Long-Term | Total | |||||||||
| Not subject to expiration |
$185,578,418 | $20,854,704 | $206,433,122 | |||||||||
| * | Capital loss carryforward 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
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $743,961,791 and $803,663,377, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
| Aggregate unrealized appreciation of investments |
$ | 372,157,895 | ||
| Aggregate unrealized (depreciation) of investments |
(12,940,162 | ) | ||
| Net unrealized appreciation of investments |
$ | 359,217,733 | ||
Cost of investments for tax purposes is $1,160,001,635.
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
| Sold: |
||||||||||||||||
| Class A |
419,707 | $ | 10,771,934 | 692,436 | $ | 14,038,067 | ||||||||||
| Class C |
63,231 | 1,451,584 | 114,026 | 2,087,210 | ||||||||||||
| Class R |
130,491 | 3,349,934 | 244,930 | 5,060,552 | ||||||||||||
| Class Y |
1,095,371 | 28,712,746 | 1,419,957 | 30,169,133 | ||||||||||||
| Class R6 |
1,101,575 | 29,141,385 | 2,256,324 | 44,129,576 | ||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
32,590 | 803,351 | 116,635 | 2,519,320 | ||||||||||||
| Class C |
— | — | 8,411 | 161,900 | ||||||||||||
| Class R |
2,691 | 65,479 | 12,437 | 265,283 | ||||||||||||
| Class Y |
26,706 | 663,640 | 55,002 | 1,196,848 | ||||||||||||
| Class R6 |
412,337 | 10,102,244 | 1,352,711 | 29,029,171 | ||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
121,300 | 3,098,997 | 81,171 | 1,691,345 | ||||||||||||
| Class C |
(136,523 | ) | (3,098,997 | ) | (91,367 | ) | (1,691,345 | ) | ||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(920,577 | ) | (23,633,722 | ) | (1,903,130 | ) | (38,721,632 | ) | ||||||||
| Class C |
(92,546 | ) | (2,142,472 | ) | (337,212 | ) | (6,108,690 | ) | ||||||||
| Class R |
(117,222 | ) | (3,001,099 | ) | (276,642 | ) | (5,642,296 | ) | ||||||||
| Class Y |
(681,560 | ) | (18,008,276 | ) | (1,589,474 | ) | (32,558,918 | ) | ||||||||
| Class R6 |
(4,349,338 | ) | (111,053,681 | ) | (28,424,686 | ) | (591,263,423 | ) | ||||||||
| Net increase (decrease) in share activity |
(2,891,767 | ) | $ | (72,776,953 | ) | (26,268,471 | ) | $ | (545,637,899 | ) | ||||||
| (a) | 75% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
15 Invesco International Equity Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL (5% annual return
before |
Annualized Expense Ratio | ||||||||||||||||||||||
| Beginning Account Value |
Ending Account Value |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 | ||||||||||||||||||||
|
Class A |
$ | 1,000.00 | $ | 1,223.20 | $ | 6.78 | $ | 1,018.70 | $ | 6.16 | 1.23 | % | ||||||||||||
|
Class C |
1,000.00 | 1,219.00 | 10.89 | 1,014.98 | 9.89 | 1.98 | ||||||||||||||||||
|
Class R |
1,000.00 | 1,222.20 | 8.15 | 1,017.46 | 7.40 | 1.48 | ||||||||||||||||||
|
Class Y |
1,000.00 | 1,225.90 | 4.69 | 1,020.58 | 4.26 | 0.85 | ||||||||||||||||||
|
Class R5 |
1,000.00 | 1,226.00 | 4.36 | 1,020.88 | 3.96 | 0.79 | ||||||||||||||||||
|
Class R6 |
1,000.00 | 1,225.90 | 4.36 | 1,020.88 | 3.96 | 0.79 | ||||||||||||||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
16 Invesco International Equity Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | O-IEQ-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders
|
April 30, 2021
| ||
|
| ||||
| Invesco International Growth Fund | ||||
|
Nasdaq: |
||||
| A: AIIEX ∎ C: AIECX ∎ R: AIERX ∎ Y: AIIYX ∎ R5: AIEVX ∎ R6: IGFRX | ||||
| 2 | Fund Performance | |||
| 4 | Liquidity Risk Management Program | |||
| 5 | Schedule of Investments | |||
| 8 | Financial Statements | |||
| 11 | Financial Highlights | |||
| 12 | Notes to Financial Statements | |||
| 18 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
| Performance summary |
| |||
| Fund vs. Indexes |
| |||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
| Class A Shares | 22.21 | % | ||
| Class C Shares | 21.73 | |||
| Class R Shares | 22.03 | |||
| Class Y Shares | 22.33 | |||
| Class R5 Shares | 22.39 | |||
| Class R6 Shares | 22.44 | |||
| MSCI All Country World ex-USA Indexq (Broad Market Index) | 27.40 | |||
| Custom Invesco International Growth Index∎ (Style-Specific Index) | 20.14 | |||
| Lipper International Large-Cap Growth Funds Index¨ (Peer Group Index) | 22.66 | |||
| Source(s): qRIMES Technologies Corp.; ∎Invesco, RIMES Technologies Corp.; ¨Lipper Inc. |
| |||
| The MSCI All Country World ex-USA® Index is an index considered representative of developed and emerging stock markets, excluding the US. The index is computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||
| The Custom Invesco International Growth Index is composed of the MSCI EAFE Growth Index through February 28, 2013, and the MSCI All Country World ex-USA Growth Index thereafter. The MSCI EAFE® Growth Index is an unmanaged index considered representative of growth stocks of Europe, Australasia and the Far East. The MSCI All Country World ex-USA Growth Index is a market capitalization weighted index that includes growth companies in developed and emerging markets, excluding the US. Both MSCI indexes are computed using the net return, which withholds applicable taxes for non-resident investors. |
| |||
| The Lipper International Large-Cap Growth Funds Index is an unmanaged index considered representative of international large-cap growth funds tracked by Lipper. |
| |||
| The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
| A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
| |||
| For more information about your Fund
|
| Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. |
|
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
|
2 Invesco International Growth Fund
3 Invesco International Growth Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco International Growth Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco International Growth Fund
Investment Abbreviations:
ADR – American Depositary Receipt
CDI – CREST Depository Interest
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, 2021. |
| (c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$26,972,261 | $ | 170,933,709 | $ | (177,264,968 | ) | $ | - | $ | - | $ | 20,641,002 | $ | 3,268 | |||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
20,334,690 | 122,095,507 | (126,617,834 | ) | 1,145 | (978 | ) | 15,812,530 | 4,533 | ||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
30,825,441 | 195,352,810 | (202,588,534 | ) | - | - | 23,589,717 | 1,541 | |||||||||||||||||||||||||||
| Investments Purchased with Cash Collateral from Securities on Loan: | |||||||||||||||||||||||||||||||||||
| Invesco Private Government Fund |
- | 90,489,428 | (57,133,362 | ) | - | - | 33,356,066 | 302 | * | ||||||||||||||||||||||||||
| Invesco Private Prime Fund |
- | 191,212,136 | (141,178,036 | ) | - | - | 50,034,100 | 3,722 | * | ||||||||||||||||||||||||||
| Total |
$78,132,392 | $ | 770,083,590 | $ | (704,782,734 | ) | $ | 1,145 | $ | (978 | ) | $ | 143,433,415 | $ | 13,366 | ||||||||||||||||||||
| * | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| (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 1I. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco International Growth Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Consumer Discretionary |
18.79 | % | ||
| Industrials |
16.32 | |||
| Financials |
14.69 | |||
| Information Technology |
14.41 | |||
| Consumer Staples |
13.48 | |||
| Health Care |
8.91 | |||
| Communication Services |
6.07 | |||
| Materials |
4.80 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
2.53 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco International Growth Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco International Growth Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $2,893,688) |
$ | 27,929,449 | ||
|
|
||||
| Dividends from affiliated money market funds (includes securities lending income of $3,828) |
13,170 | |||
|
|
||||
| Total investment income |
27,942,619 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
16,428,953 | |||
|
|
||||
| Administrative services fees |
273,519 | |||
|
|
||||
| Custodian fees |
265,101 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
1,750,766 | |||
|
|
||||
| Class C |
178,680 | |||
|
|
||||
| Class R |
130,703 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
1,994,813 | |||
|
|
||||
| Transfer agent fees – R5 |
225,017 | |||
|
|
||||
| Transfer agent fees – R6 |
29,755 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
47,641 | |||
|
|
||||
| Registration and filing fees |
87,672 | |||
|
|
||||
| Reports to shareholders |
175,922 | |||
|
|
||||
| Professional services fees |
149,072 | |||
|
|
||||
| Other |
61,963 | |||
|
|
||||
| Total expenses |
21,799,577 | |||
|
|
||||
| Less: Fees waived and/or expense offset arrangement(s) |
(28,712 | ) | ||
|
|
||||
| Net expenses |
21,770,865 | |||
|
|
||||
| Net investment income |
6,171,754 | |||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
422,378,673 | |||
|
|
||||
| Affiliated investment securities |
(978 | ) | ||
|
|
||||
| Foreign currencies |
(285,186 | ) | ||
|
|
||||
| 422,092,509 | ||||
|
|
||||
| Change in net unrealized appreciation (depreciation) of: |
||||
| Unaffiliated investment securities |
330,653,441 | |||
|
|
||||
| Affiliated investment securities |
1,145 | |||
|
|
||||
| Foreign currencies |
(197,961 | ) | ||
|
|
||||
| 330,456,625 | ||||
|
|
||||
| Net realized and unrealized gain |
752,549,134 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 758,720,888 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco International Growth Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income |
$ | 6,171,754 | $ | 24,285,537 | ||||
|
|
||||||||
| Net realized gain |
422,092,509 | 457,164,198 | ||||||
|
|
||||||||
| Change in net unrealized appreciation (depreciation) |
330,456,625 | (460,154,375 | ) | |||||
|
|
||||||||
| Net increase in net assets resulting from operations |
758,720,888 | 21,295,360 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(162,363,303 | ) | (154,710,175 | ) | ||||
|
|
||||||||
| Class C |
(4,686,976 | ) | (5,609,245 | ) | ||||
|
|
||||||||
| Class R |
(6,009,271 | ) | (5,979,322 | ) | ||||
|
|
||||||||
| Class Y |
(95,393,068 | ) | (111,599,569 | ) | ||||
|
|
||||||||
| Class R5 |
(60,741,990 | ) | (62,024,150 | ) | ||||
|
|
||||||||
| Class R6 |
(119,582,621 | ) | (160,535,126 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(448,777,229 | ) | (500,457,587 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
27,236,381 | (129,056,281 | ) | |||||
|
|
||||||||
| Class C |
(5,900,484 | ) | (14,011,693 | ) | ||||
|
|
||||||||
| Class R |
(1,258,162 | ) | (9,275,895 | ) | ||||
|
|
||||||||
| Class Y |
(23,262,835 | ) | (238,469,069 | ) | ||||
|
|
||||||||
| Class R5 |
(20,109,054 | ) | (193,580,515 | ) | ||||
|
|
||||||||
| Class R6 |
(41,968,487 | ) | (440,097,022 | ) | ||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
(65,262,641 | ) | (1,024,490,475 | ) | ||||
|
|
||||||||
| Net increase (decrease) in net assets |
244,681,018 | (1,503,652,702 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
3,499,255,450 | 5,002,908,152 | ||||||
|
|
||||||||
| End of period |
$ | 3,743,936,468 | $ | 3,499,255,450 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco International Growth Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from operations |
Dividends investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period (b) |
Total return |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average net assets with fee waivers and/or expenses absorbed |
Ratio of expenses |
Ratio of net investment income (loss) to average net assets |
Portfolio turnover (c) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 31.34 | $ | 0.02 | $ | 6.63 | $ | 6.65 | $ | (0.30 | ) | $ | (3.81 | ) | $ | (4.11 | ) | $ | 33.88 | 22.21 | % | $ | 1,401,147 | 1.34 | %(d) | 1.34 | %(d) | 0.13 | %(d) | 16 | % | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
34.10 | 0.11 | 0.62 | 0.73 | (0.65 | ) | (2.84 | ) | (3.49 | ) | 31.34 | 1.97 | 1,262,456 | 1.35 | 1.35 | 0.36 | 35 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
31.92 | 0.38 | 4.55 | 4.93 | (0.29 | ) | (2.46 | ) | (2.75 | ) | 34.10 | 17.23 | 1,534,830 | 1.33 | 1.33 | 1.20 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
36.61 | 0.42 | (4.18 | ) | (3.76 | ) | (0.60 | ) | (0.33 | ) | (0.93 | ) | 31.92 | (10.55 | ) | 1,665,413 | 1.30 | 1.31 | 1.20 | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
30.83 | 0.30 | 5.85 | 6.15 | (0.37 | ) | – | (0.37 | ) | 36.61 | 20.19 | 2,396,149 | 1.31 | 1.32 | 0.89 | 25 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
31.91 | 0.36 | (1.06 | ) | (0.70 | ) | (0.38 | ) | – | (0.38 | ) | 30.83 | (2.16 | ) | 2,332,125 | 1.31 | 1.32 | 1.15 | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
28.22 | (0.09 | ) | 5.94 | 5.85 | (0.02 | ) | (3.81 | ) | (3.83 | ) | 30.24 | 21.73 | 32,836 | 2.09 | (d) | 2.09 | (d) | (0.62 | )(d) | 16 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
31.01 | (0.11 | ) | 0.56 | 0.45 | (0.40 | ) | (2.84 | ) | (3.24 | ) | 28.22 | 1.20 | 36,108 | 2.10 | 2.10 | (0.39 | ) | 35 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
29.20 | 0.13 | 4.16 | 4.29 | (0.02 | ) | (2.46 | ) | (2.48 | ) | 31.01 | 16.37 | 55,768 | 2.08 | 2.08 | 0.45 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
33.55 | 0.14 | (3.83 | ) | (3.69 | ) | (0.33 | ) | (0.33 | ) | (0.66 | ) | 29.20 | (11.22 | ) | 105,735 | 2.05 | 2.06 | 0.45 | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
28.25 | 0.04 | 5.38 | 5.42 | (0.12 | ) | – | (0.12 | ) | 33.55 | 19.28 | 144,710 | 2.06 | 2.07 | 0.14 | 25 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
29.25 | 0.11 | (0.95 | ) | (0.84 | ) | (0.16 | ) | – | (0.16 | ) | 28.25 | (2.88 | ) | 160,642 | 2.06 | 2.07 | 0.40 | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
30.87 | (0.02 | ) | 6.52 | 6.50 | (0.21 | ) | (3.81 | ) | (4.02 | ) | 33.35 | 22.03 | 50,457 | 1.59 | (d) | 1.59 | (d) | (0.12 | )(d) | 16 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
33.64 | 0.03 | 0.61 | 0.64 | (0.57 | ) | (2.84 | ) | (3.41 | ) | 30.87 | 1.71 | 47,493 | 1.60 | 1.60 | 0.11 | 35 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
31.49 | 0.30 | 4.51 | 4.81 | (0.20 | ) | (2.46 | ) | (2.66 | ) | 33.64 | 16.99 | 62,045 | 1.58 | 1.58 | 0.95 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
36.13 | 0.33 | (4.13 | ) | (3.80 | ) | (0.51 | ) | (0.33 | ) | (0.84 | ) | 31.49 | (10.78 | ) | 66,981 | 1.55 | 1.56 | 0.95 | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
30.41 | 0.21 | 5.80 | 6.01 | (0.29 | ) | – | (0.29 | ) | 36.13 | 19.94 | 99,556 | 1.56 | 1.57 | 0.64 | 25 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
31.49 | 0.28 | (1.05 | ) | (0.77 | ) | (0.31 | ) | – | (0.31 | ) | 30.41 | (2.44 | ) | 100,493 | 1.56 | 1.57 | 0.90 | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
31.46 | 0.06 | 6.64 | 6.70 | (0.38 | ) | (3.81 | ) | (4.19 | ) | 33.97 | 22.33 | 793,719 | 1.09 | (d) | 1.09 | (d) | 0.38 | (d) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
34.21 | 0.19 | 0.62 | 0.81 | (0.72 | ) | (2.84 | ) | (3.56 | ) | 31.46 | 2.22 | 751,518 | 1.10 | 1.10 | 0.61 | 35 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
32.05 | 0.46 | 4.55 | 5.01 | (0.39 | ) | (2.46 | ) | (2.85 | ) | 34.21 | 17.51 | 1,091,697 | 1.08 | 1.08 | 1.45 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
36.75 | 0.51 | (4.19 | ) | (3.68 | ) | (0.69 | ) | (0.33 | ) | (1.02 | ) | 32.05 | (10.31 | ) | 1,635,426 | 1.05 | 1.06 | 1.45 | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
30.96 | 0.38 | 5.87 | 6.25 | (0.46 | ) | – | (0.46 | ) | 36.75 | 20.47 | 2,427,028 | 1.06 | 1.07 | 1.14 | 25 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
32.04 | 0.44 | (1.05 | ) | (0.61 | ) | (0.47 | ) | – | (0.47 | ) | 30.96 | (1.89 | ) | 3,393,370 | 1.06 | 1.07 | 1.40 | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
32.02 | 0.08 | 6.76 | 6.84 | (0.42 | ) | (3.81 | ) | (4.23 | ) | 34.63 | 22.39 | 511,110 | 1.01 | (d) | 1.01 | (d) | 0.46 | (d) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
34.76 | 0.22 | 0.63 | 0.85 | (0.75 | ) | (2.84 | ) | (3.59 | ) | 32.02 | 2.32 | 486,808 | 1.00 | 1.00 | 0.71 | 35 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
32.48 | 0.50 | 4.63 | 5.13 | (0.39 | ) | (2.46 | ) | (2.85 | ) | 34.76 | 17.66 | 735,592 | 0.98 | 0.98 | 1.55 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
37.24 | 0.55 | (4.25 | ) | (3.70 | ) | (0.73 | ) | (0.33 | ) | (1.06 | ) | 32.48 | (10.25 | ) | 1,124,979 | 0.97 | 0.98 | 1.53 | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
31.37 | 0.41 | 5.95 | 6.36 | (0.49 | ) | – | (0.49 | ) | 37.24 | 20.57 | 1,543,192 | 0.98 | 0.99 | 1.22 | 25 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
32.47 | 0.47 | (1.08 | ) | (0.61 | ) | (0.49 | ) | – | (0.49 | ) | 31.37 | (1.85 | ) | 1,471,592 | 0.97 | 0.98 | 1.49 | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
31.97 | 0.09 | 6.75 | 6.84 | (0.45 | ) | (3.81 | ) | (4.26 | ) | 34.55 | 22.44 | 954,668 | 0.93 | (d) | 0.93 | (d) | 0.54 | (d) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
34.71 | 0.25 | 0.63 | 0.88 | (0.78 | ) | (2.84 | ) | (3.62 | ) | 31.97 | 2.41 | 914,873 | 0.91 | 0.91 | 0.80 | 35 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
32.49 | 0.53 | 4.61 | 5.14 | (0.46 | ) | (2.46 | ) | (2.92 | ) | 34.71 | 17.74 | 1,522,977 | 0.90 | 0.90 | 1.63 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
37.25 | 0.58 | (4.25 | ) | (3.67 | ) | (0.76 | ) | (0.33 | ) | (1.09 | ) | 32.49 | (10.15 | ) | 1,792,725 | 0.89 | 0.90 | 1.61 | 26 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
31.38 | 0.45 | 5.94 | 6.39 | (0.52 | ) | — | (0.52 | ) | 37.25 | 20.68 | 2,427,136 | 0.89 | 0.90 | 1.31 | 25 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/16 |
32.48 | 0.50 | (1.08 | ) | (0.58 | ) | (0.52 | ) | — | (0.52 | ) | 31.38 | (1.76 | ) | 764,437 | 0.88 | 0.89 | 1.58 | 12 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $1,412,220, $36,032, $52,715, $805,657, $527,836 and $1,005,984 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco International Growth Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco International Growth Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 Invesco International Growth Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy 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. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the 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. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. 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. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The 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 Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
| J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 Invesco International Growth Fund
| foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| L. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
| M. | Other Risks – Emerging markets (also referred to as developing markets) are generally subject to greater market volatility, political, social and economic instability, uncertainty regarding the existence of trading markets and more governmental limitations on foreign investment than more developed markets. In addition, companies operating in emerging markets may be subject to lower trading volume and greater price fluctuations than companies in more developed markets. Securities law in many emerging market countries is relatively new and unsettled. Therefore, laws regarding foreign investment in emerging market securities, securities regulation, title to securities, and shareholder rights may change quickly and unpredictably. In addition, the enforcement of systems of taxation at federal, regional and local levels in emerging market countries may be inconsistent, and subject to sudden change. Other risks of investing in emerging markets securities may include additional transaction costs, delays in settlement procedures, and lack of timely information. |
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets | Rate | |||
| First $250 million |
0.935% | |||
| Next $250 million |
0.910% | |||
| Next $500 million |
0.885% | |||
| Next $1.5 billion |
0.860% | |||
| Next $2.5 billion |
0.835% | |||
| Next $2.5 billion |
0.810% | |||
| Next $2.5 billion |
0.785% | |||
| Over $10 billion |
0.760% | |||
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.86%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through at least June 30, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.25%, 3.00%, 2.50%, 2.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $26,878.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company
14 Invesco International Growth Fund
(“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $71,530 in front-end sales commissions from the sale of Class A shares and $2,490 and $832 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $248 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Investments in Securities |
||||||||||||||||
| Australia |
$ | – | $ | 21,438,603 | $– | $ | 21,438,603 | |||||||||
| Brazil |
78,726,411 | – | – | 78,726,411 | ||||||||||||
| Canada |
296,237,290 | – | – | 296,237,290 | ||||||||||||
| China |
287,236,169 | 202,655,612 | – | 489,891,781 | ||||||||||||
| Denmark |
– | 95,976,330 | – | 95,976,330 | ||||||||||||
| France |
– | 205,015,650 | – | 205,015,650 | ||||||||||||
| Germany |
– | 98,851,916 | – | 98,851,916 | ||||||||||||
| Hong Kong |
– | 80,387,939 | – | 80,387,939 | ||||||||||||
| India |
78,195,144 | – | – | 78,195,144 | ||||||||||||
| Ireland |
44,164,729 | 106,282,773 | – | 150,447,502 | ||||||||||||
| Italy |
– | 83,009,869 | – | 83,009,869 | ||||||||||||
| Japan |
– | 469,060,068 | – | 469,060,068 | ||||||||||||
| Macau |
– | 55,954,923 | – | 55,954,923 | ||||||||||||
| Mexico |
100,065,178 | – | – | 100,065,178 | ||||||||||||
| Netherlands |
– | 193,512,533 | – | 193,512,533 | ||||||||||||
| Singapore |
– | 40,331,557 | – | 40,331,557 | ||||||||||||
| South Korea |
– | 161,069,897 | – | 161,069,897 | ||||||||||||
| Sweden |
– | 175,379,354 | – | 175,379,354 | ||||||||||||
| Switzerland |
– | 218,191,764 | – | 218,191,764 | ||||||||||||
| Taiwan |
– | 103,427,554 | – | 103,427,554 | ||||||||||||
| United Kingdom |
65,987,307 | 83,704,528 | – | 149,691,835 | ||||||||||||
| United States |
247,015,449 | 57,220,880 | – | 304,236,329 | ||||||||||||
15 Invesco International Growth Fund
| Level 1 | Level 2 | Level 3 | Total | |||||||||||
| Money Market Funds |
$ | 60,043,249 | $ | 83,390,166 | $– | $ | 143,433,415 | |||||||
| Total Investments |
$ | 1,257,670,926 | $ | 2,534,861,916 | $– | $ | 3,792,532,842 | |||||||
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $1,834.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $566,550,801 and $1,055,527,332, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis |
| |||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 1,433,685,886 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(6,364,387 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 1,427,321,499 | ||
|
|
||||
| Cost of investments for tax purposes is $2,365,211,343. |
||||
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
1,258,856 | $ | 42,196,554 | 3,021,736 | $ | 91,353,669 | ||||||||||
|
|
||||||||||||||||
| Class C |
60,642 | 1,817,265 | 130,363 | 3,577,274 | ||||||||||||
|
|
||||||||||||||||
| Class R |
116,056 | 3,827,090 | 241,319 | 7,128,370 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
1,707,392 | 56,702,872 | 4,672,896 | 140,357,208 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
869,296 | 29,683,446 | 1,978,447 | 61,678,959 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
2,664,468 | 90,667,663 | 12,442,813 | 392,370,901 | ||||||||||||
|
|
||||||||||||||||
16 Invesco International Growth Fund
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
4,683,377 | $ | 147,432,644 | 4,316,223 | $ | 137,514,849 | ||||||||||
|
|
||||||||||||||||
| Class C |
153,799 | 4,334,053 | 175,747 | 5,073,827 | ||||||||||||
|
|
||||||||||||||||
| Class R |
193,675 | 6,007,801 | 189,966 | 5,972,526 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
2,274,006 | 71,722,134 | 2,263,480 | 72,227,659 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
1,851,390 | 59,485,152 | 1,844,768 | 59,844,271 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
3,350,388 | 107,379,925 | 4,460,323 | 144,380,668 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
208,262 | 6,770,408 | 254,538 | 8,004,884 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(232,787 | ) | (6,770,408 | ) | (281,778 | ) | (8,004,884 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(5,070,159 | ) | (169,163,225 | ) | (12,317,676 | ) | (365,929,683 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(175,343 | ) | (5,281,394 | ) | (543,223 | ) | (14,657,910 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(335,444 | ) | (11,093,053 | ) | (737,251 | ) | (22,376,791 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(4,505,230 | ) | (151,687,841 | ) | (14,958,315 | ) | (451,053,936 | ) | ||||||||
|
|
||||||||||||||||
| Class R5 |
(3,165,811 | ) | (109,277,652 | ) | (9,782,237 | ) | (315,103,745 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(7,000,559 | ) | (240,016,075 | ) | (32,166,042 | ) | (976,848,591 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
(1,093,726 | ) | $ | (65,262,641 | ) | (34,793,903 | ) | $ | (1,024,490,475 | ) | ||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 58% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
17 Invesco International Growth Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| HYPOTHETICAL | ||||||||||||
| (5% annual return before | ||||||||||||
| ACTUAL | expenses) | |||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Ratio | |||||||
|
Class A |
$1,000.00 | $1,222.10 | $7.38 | $1,018.15 | $6.71 | 1.34% | ||||||
|
Class C |
1,000.00 | 1,217.30 | 11.49 | 1,014.43 | 10.44 | 2.09 | ||||||
|
Class R |
1,000.00 | 1,220.30 | 8.75 | 1,016.91 | 7.95 | 1.59 | ||||||
|
Class Y |
1,000.00 | 1,223.30 | 6.01 | 1,019.39 | 5.46 | 1.09 | ||||||
|
Class R5 |
1,000.00 | 1,223.90 | 5.57 | 1,019.79 | 5.06 | 1.01 | ||||||
|
Class R6 |
1,000.00 | 1,224.40 | 5.13 | 1,020.18 | 4.66 | 0.93 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
18 Invesco International Growth Fund
(This page intentionally left blank)
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
| A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov. | ||
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. |
| |
| Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. | ||
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | IGR-SAR-1 |
|
| ||||
|
Semiannual Report to Shareholders
|
April 30, 2021 | ||
|
| ||||
| Invesco International Small-Mid Company Fund
Nasdaq: A: OSMAX ∎ C: OSMCX ∎ R: OSMNX ∎ Y: OSMYX ∎ R5: INSLX ∎ R6: OSCIX | ||||
| 2 | ||||
| 4 | ||||
| 5 | ||||
| 9 | ||||
| 12 | ||||
| 13 | ||||
| 19 |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
| 2 Invesco International Small-Mid Company Fund |
| 3 Invesco International Small-Mid Company Fund |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
| 4 Invesco International Small-Mid Company Fund |
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco International Small-Mid Company Fund
Investment Abbreviations:
| ADR | – | American Depositary Receipt | ||
| BR | – | Bearer Shares |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco International Small-Mid Company Fund
Notes to Schedule of Investments:
| (a) | Affiliated issuer. The issuer is affiliated by having an investment adviser that is under common control of Invesco Ltd. and/or the Investment Company Act of 1940, as amended (the “1940 Act”), defines “affiliated person” to include an issuer of which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation (Depreciation) |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ | 39,277,690 | $ | 235,195,634 | $ | (249,254,135 | ) | $ | - | $ | - | $ | 25,219,189 | $ | 3,309 | ||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
28,049,904 | 167,996,882 | (178,038,668 | ) | 2,540 | (3,726 | ) | 18,006,932 | 4,608 | ||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
44,888,789 | 268,795,010 | (284,861,869 | ) | - | - | 28,821,930 | 1,639 | |||||||||||||||||||||||||||
| Investments in Other Affiliates: | |||||||||||||||||||||||||||||||||||
| Amadeus Fire AG |
27,870,081 | 6,264,247 | (2,739,809) | 20,276,653 | 103,766 | 51,774,938 | - | ||||||||||||||||||||||||||||
| Ariake Japan Co. Ltd. |
103,344,508 | 4,597,294 | - | (10,257,397 | ) | - | 97,684,405 | 736,936 | |||||||||||||||||||||||||||
| Bravura Solutions Ltd. |
40,415,125 | 14,870,457 | - | 1,169,210 | - | 56,454,792 | 472,294 | ||||||||||||||||||||||||||||
| Eiken Chemical Co. Ltd. |
35,633,038 | 7,620,659 | - | 1,307,091 | - | 44,560,788 | 446,029 | ||||||||||||||||||||||||||||
| Fukui Computer Holdings, Inc. |
27,035,280 | 6,462,472 | - | 7,593,461 | - | 41,091,213 | 406,290 | ||||||||||||||||||||||||||||
| IPH Ltd. |
58,796,540 | 9,348,670 | - | 11,283,260 | - | 79,428,470 | 1,610,154 | ||||||||||||||||||||||||||||
| Johnson Service Group PLC |
28,576,830 | 9,067,997 | (11,406,380 | ) | 24,352,113 | 862,634 | 51,453,194 | - | |||||||||||||||||||||||||||
| Karnov Group AB |
17,815,351 | 24,061,284 | - | (1,594,188 | ) | - | 40,282,447 | - | |||||||||||||||||||||||||||
| Odontoprev S.A. |
61,975,106 | 9,249,921 | - | 4,193,683 | - | 75,418,710 | 1,998,377 | ||||||||||||||||||||||||||||
| Restore PLC |
37,754,427 | 25,243,992 | - | 15,109,127 | - | 78,107,546 | - | ||||||||||||||||||||||||||||
| Sdiptech AB, Class B |
44,803,829 | 3,371,061 | - | 67,739,579 | - | 115,914,469 | - | ||||||||||||||||||||||||||||
| Total |
$ | 596,236,498 | $ | 792,145,580 | $ | (726,300,861 | ) | $ | 141,175,132 | $ | 962,674 | $ | 804,219,023 | $ | 5,679,636 | ||||||||||||||||||||
| (b) | Non-income producing security. |
| (c) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $458,086,317, which represented 5.47% of the Fund’s Net Assets. |
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| Open Forward Foreign Currency Contracts | ||||||||||||||||||
| Contract to | Unrealized Appreciation | |||||||||||||||||
| Settlement Date |
Counterparty |
Deliver |
Receive | |||||||||||||||
| Currency Risk |
||||||||||||||||||
| 05/03/2021 |
State Street Bank & Trust Co. | DKK 16,610,097 | USD 2,700,842 | $ | 15,470 | |||||||||||||
| Abbreviations: |
| DKK – Danish Krone |
| USD – U.S. Dollar |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco International Small-Mid Company Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Industrials |
32.30% | ||||
| Information Technology |
22.84 | ||||
| Health Care |
19.52 | ||||
| Materials |
7.12 | ||||
| Financials |
5.23 | ||||
| Consumer Discretionary |
4.86 | ||||
| Communication Services |
3.12 | ||||
| Consumer Staples |
2.53 | ||||
| Energy |
1.50 | ||||
| Money Market Funds Plus Other Assets Less Liabilities |
0.98 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco International Small-Mid Company Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco International Small-Mid Company Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
|||||
| Dividends (net of foreign withholding taxes of $6,645,612) |
$ | 47,634,345 | |||
| Dividends from affiliates |
5,679,636 | ||||
| Total investment income |
53,313,981 | ||||
| Expenses: |
|||||
| Advisory fees |
36,197,378 | ||||
| Administrative services fees |
574,875 | ||||
| Custodian fees |
401,831 | ||||
| Distribution fees: |
|||||
| Class A |
1,576,634 | ||||
| Class C |
680,450 | ||||
| Class R |
243,800 | ||||
| Transfer agent fees – A, C, R and Y |
3,600,337 | ||||
| Transfer agent fees – R5 |
115 | ||||
| Transfer agent fees – R6 |
57,194 | ||||
| Trustees’ and officers’ fees and benefits |
59,080 | ||||
| Registration and filing fees |
97,069 | ||||
| Reports to shareholders |
284,145 | ||||
| Professional services fees |
74,279 | ||||
| Other |
155,152 | ||||
| Total expenses |
44,002,339 | ||||
| Less: Fees waived and/or expense offset arrangement(s) |
(36,029 | ) | |||
| Net expenses |
43,966,310 | ||||
| Net investment income |
9,347,671 | ||||
| Realized and unrealized gain from: |
|||||
| Net realized gain from: |
|||||
| Unaffiliated investment securities |
554,805,256 | ||||
| Affiliated investment securities |
962,674 | ||||
| Foreign currencies |
576,662 | ||||
| Forward foreign currency contracts |
7,909 | ||||
| 556,352,501 | |||||
| Change in net unrealized appreciation of: |
|||||
| Unaffiliated investment securities (net of foreign taxes of $2,318,899) |
660,138,240 | ||||
| Affiliated investment securities |
141,175,132 | ||||
| Foreign currencies |
63,833 | ||||
| Forward foreign currency contracts |
15,470 | ||||
| 801,392,675 | |||||
| Net realized and unrealized gain |
1,357,745,176 | ||||
| Net increase in net assets resulting from operations |
$ | 1,367,092,847 | |||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco International Small-Mid Company Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income |
$ | 9,347,671 | $ | 1,132,568 | ||||
|
|
||||||||
| Net realized gain |
556,352,501 | 660,987,254 | ||||||
|
|
||||||||
| Change in net unrealized appreciation |
801,392,675 | 9,826,187 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
1,367,092,847 | 671,946,009 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(102,620,780 | ) | (68,564,322 | ) | ||||
|
|
||||||||
| Class C |
(12,866,556 | ) | (9,282,895 | ) | ||||
|
|
||||||||
| Class R |
(8,163,910 | ) | (4,821,631 | ) | ||||
|
|
||||||||
| Class Y |
(284,649,017 | ) | (199,590,573 | ) | ||||
|
|
||||||||
| Class R5 |
(30,241 | ) | (1,005 | ) | ||||
|
|
||||||||
| Class R6 |
(220,448,627 | ) | (135,725,491 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(628,779,131 | ) | (417,985,917 | ) | ||||
|
|
||||||||
| Share transactions-net: |
||||||||
| Class A |
20,158,777 | (273,141,625 | ) | |||||
|
|
||||||||
| Class C |
(18,862,864 | ) | (46,452,075 | ) | ||||
|
|
||||||||
| Class R |
3,887,575 | (11,979,326 | ) | |||||
|
|
||||||||
| Class Y |
164,082,227 | (894,900,951 | ) | |||||
|
|
||||||||
| Class R5 |
196,754 | 144,499 | ||||||
|
|
||||||||
| Class R6 |
272,460,353 | (367,793,076 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
441,922,822 | (1,594,122,554 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets |
1,180,236,538 | (1,340,162,462 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
7,196,128,630 | 8,536,291,092 | ||||||
|
|
||||||||
| End of period |
$ | 8,376,365,168 | $ | 7,196,128,630 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco International Small-Mid Company Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net (loss)(a) |
Net gains on securities |
Total from investment operations |
Dividends from net investment income |
Distributions realized |
Total distributions |
Net asset value, end of period |
Total return(b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses absorbed |
Ratio of and/or absorbed(c) |
Ratio of net investment income (loss) to average |
Portfolio turnover(d) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 | $ | 51.69 | $ | 0.00 | $ | 9.51 | $ | 9.51 | $ | - | $ | (4.50 | ) | $ | (4.50 | ) | $ | 56.70 | 19.10 | %(e) | $ | 1,340,782 | 1.33 | %(e)(f) | 1.33 | %(e)(f) | 0.00 | %(e)(f) | 16 | % | ||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 | 48.20 | (0.10 | ) | 5.95 | 5.85 | (0.18 | ) | (2.18 | ) | (2.36 | ) | 51.69 | 12.53 | (e) | 1,199,225 | 1.34 | (e) | 1.34 | (e) | (0.22 | )(e) | 73 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Two months ended 10/31/19 | 46.25 | (0.03 | ) | 1.98 | 1.95 | - | - | - | 48.20 | 4.22 | 1,417,657 | 1.31 | (g) | 1.31 | (g) | (0.37 | )(g) | 0 | (h) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/19 | 54.54 | (0.03 | ) | (3.81 | ) | (3.84 | ) | (0.22 | ) | (4.23 | ) | (4.45 | ) | 46.25 | (6.21 | ) | 1,394,542 | 1.36 | 1.36 | (0.06 | ) | 28 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/18 | 47.11 | (0.05 | ) | 8.94 | 8.89 | (0.37 | ) | (1.09 | ) | (1.46 | ) | 54.54 | 19.27 | 1,777,990 | 1.38 | 1.38 | (0.10 | ) | 27 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/17 | 38.28 | (0.06 | ) | 8.95 | 8.89 | (0.06 | ) | - | (0.06 | ) | 47.11 | 23.25 | 2,260,943 | 1.41 | 1.41 | (0.15 | ) | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/16 | 36.38 | 0.05 | 1.87 | 1.92 | (0.02 | ) | - | (0.02 | ) | 38.28 | 5.29 | 2,678,644 | 1.29 | 1.29 | (0.14 | ) | 19 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 | 46.22 | (0.18 | ) | 8.44 | 8.26 | - | (4.50 | ) | (4.50 | ) | 49.98 | 18.62 | 127,484 | 2.09 | (f) | 2.09 | (f) | (0.76 | )(f) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 | 43.62 | (0.41 | ) | 5.34 | 4.93 | (0.15 | ) | (2.18 | ) | (2.33 | ) | 46.22 | 11.70 | 135,265 | 2.10 | 2.10 | (0.98 | ) | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Two months ended 10/31/19 | 41.91 | (0.08 | ) | 1.79 | 1.71 | - | - | - | 43.62 | 4.08 | 177,238 | 2.07 | (g) | 2.07 | (g) | (1.13 | )(g) | 0 | (h) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/19 | 50.01 | (0.35 | ) | (3.52 | ) | (3.87 | ) | - | (4.23 | ) | (4.23 | ) | 41.91 | (6.91 | ) | 179,992 | 2.12 | 2.12 | (0.82 | ) | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/18 | 43.36 | (0.40 | ) | 8.22 | 7.82 | (0.08 | ) | (1.09 | ) | (1.17 | ) | 50.01 | 18.37 | 323,001 | 2.13 | 2.13 | (0.85 | ) | 27 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/17 | 35.45 | (0.34 | ) | 8.25 | 7.91 | - | - | - | 43.36 | 22.35 | 323,084 | 2.16 | 2.16 | (0.91 | ) | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/16 | 33.92 | (0.21 | ) | 1.74 | 1.53 | - | - | - | 35.45 | 4.48 | 339,118 | 2.04 | 2.04 | (0.62 | ) | 19 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 | 48.78 | (0.06 | ) | 8.94 | 8.88 | - | (4.50 | ) | (4.50 | ) | 53.16 | 18.93 | 100,743 | 1.59 | (f) | 1.59 | (f) | (0.26 | )(f) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 | 45.70 | (0.21 | ) | 5.63 | 5.42 | (0.16 | ) | (2.18 | ) | (2.34 | ) | 48.78 | 12.26 | 88,420 | 1.60 | 1.60 | (0.48 | ) | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Two months ended 10/31/19 | 43.88 | (0.05 | ) | 1.87 | 1.82 | - | - | - | 45.70 | 4.15 | 95,501 | 1.57 | (g) | 1.57 | (g) | (0.63 | )(g) | 0 | (h) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/19 | 52.05 | (0.14 | ) | (3.65 | ) | (3.79 | ) | (0.15 | ) | (4.23 | ) | (4.38 | ) | 43.88 | (6.44 | ) | 94,864 | 1.61 | 1.61 | (0.31 | ) | 28 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/18 | 45.08 | (0.17 | ) | 8.55 | 8.38 | (0.32 | ) | (1.09 | ) | (1.41 | ) | 52.05 | 18.99 | 103,818 | 1.63 | 1.63 | (0.35 | ) | 27 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/17 | 36.67 | (0.15 | ) | 8.56 | 8.41 | - | - | - | 45.08 | 22.93 | 91,019 | 1.66 | 1.66 | (0.39 | ) | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/16 | 34.92 | (0.05 | ) | 1.80 | 1.75 | - | - | - | 36.67 | 5.01 | 73,150 | 1.53 | 1.53 | (0.15 | ) | 19 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 | 51.29 | 0.07 | 9.43 | 9.50 | - | (4.50 | ) | (4.50 | ) | 56.29 | 19.23 | 3,736,948 | 1.09 | (f) | 1.09 | (f) | 0.24 | (f) | 16 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 | 47.75 | 0.02 | 5.90 | 5.92 | (0.20 | ) | (2.18 | ) | (2.38 | ) | 51.29 | 12.81 | 3,240,701 | 1.10 | 1.10 | 0.02 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Two months ended 10/31/19 | 45.80 | (0.01 | ) | 1.96 | 1.95 | - | - | - | 47.75 | 4.26 | 4,085,890 | 1.07 | (g) | 1.07 | (g) | (0.13 | )(g) | 0 | (h) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/19 | 54.15 | 0.08 | (3.80 | ) | (3.72 | ) | (0.40 | ) | (4.23 | ) | (4.63 | ) | 45.80 | (5.98 | ) | 3,986,316 | 1.12 | 1.12 | 0.18 | 28 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/18 | 46.82 | 0.08 | 8.87 | 8.95 | (0.53 | ) | (1.09 | ) | (1.62 | ) | 54.15 | 19.57 | 5,811,651 | 1.14 | 1.14 | 0.15 | 27 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/17 | 38.06 | 0.05 | 8.87 | 8.92 | (0.16 | ) | - | (0.16 | ) | 46.82 | 23.55 | 4,125,091 | 1.16 | 1.16 | 0.13 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/16 | 36.16 | 0.15 | 1.85 | 2.00 | (0.10 | ) | - | (0.10 | ) | 38.06 | 5.53 | 2,239,385 | 1.04 | 1.04 | 0.41 | 19 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 | 51.94 | 0.09 | 9.56 | 9.65 | - | (4.50 | ) | (4.50 | ) | 57.09 | 19.28 | 424 | 1.01 | (f) | 1.01 | (f) | 0.32 | (f) | 16 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 | 48.26 | 0.07 | 5.99 | 6.06 | (0.20 | ) | (2.18 | ) | (2.38 | ) | 51.94 | 12.99 | 191 | 0.99 | 0.99 | 0.13 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Two months ended 10/31/19 | 46.29 | (0.01 | ) | 1.98 | 1.97 | - | - | - | 48.26 | 4.26 | 20 | 1.01 | (g) | 1.01 | (g) | (0.07 | )(g) | 0 | (h) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 08/31/19(i) | 46.97 | 0.04 | (0.72 | ) | (0.68 | ) | - | - | - | 46.29 | (1.45 | ) | 19 | 1.01 | (g) | 1.01 | (g) | 0.29 | (g) | 28 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 | 51.52 | 0.10 | 9.48 | 9.58 | - | (4.50 | ) | (4.50 | ) | 56.60 | 19.31 | 3,069,985 | 0.95 | (f) | 0.95 | (f) | 0.38 | (f) | 16 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 | 47.90 | 0.08 | 5.93 | 6.01 | (0.21 | ) | (2.18 | ) | (2.39 | ) | 51.52 | 12.97 | 2,532,327 | 0.95 | 0.95 | 0.17 | 73 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Two months ended 10/31/19 | 45.94 | (0.00 | )(j) | 1.96 | 1.96 | - | - | - | 47.90 | 4.27 | 2,759,984 | 0.94 | (g) | 0.94 | (g) | 0.00 | (g)(h) | 0 | (h) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/19 | 54.32 | 0.16 | (3.82 | ) | (3.66 | ) | (0.49 | ) | (4.23 | ) | (4.72 | ) | 45.94 | (5.82 | ) | 2,692,561 | 0.96 | 0.96 | 0.34 | 28 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/18 | 46.95 | 0.16 | 8.90 | 9.06 | (0.60 | ) | (1.09 | ) | (1.69 | ) | 54.32 | 19.77 | 3,236,676 | 0.96 | 0.96 | 0.32 | 27 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/17 | 38.17 | 0.12 | 8.88 | 9.00 | (0.22 | ) | - | (0.22 | ) | 46.95 | 23.76 | 2,285,847 | 0.97 | 0.97 | 0.30 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 08/31/16 | 36.23 | 0.21 | 1.87 | 2.08 | (0.14 | ) | - | (0.14 | ) | 38.17 | 5.75 | 1,272,537 | 0.85 | 0.85 | 0.57 | 19 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Does not include estimated acquired fund fees from underlying funds of 0.00%, 0.01%, 0.01% , 0.01% and 0.01% for the two months ended October 31, 2019 and the years ended August 31, 2019, 2018, 2017 and 2016, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | The total return, ratio of expenses to average net assets and ratio of net investment income to average net assets reflect actual 12b-1 fees of 0.24% for the six months ended April 30, 2021 and the year ended October 31, 2020, respectively. |
| (f) | Ratios are annualized and based on average daily net assets (000’s omitted) of $1,316,799, $137,218, $98,328, $3,630,959, $392 and $2,883,413 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (g) | Annualized. |
| (h) | Amount represents less than 0.005%. |
| (i) | Commencement date after the close of business on May 24, 2019. |
| (j) | Amount represents less than $(0.005) per share. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco International Small-Mid Company Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco International Small-Mid Company Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
13 Invesco International Small-Mid Company Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination - For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. |
Therefore, no provision for federal income taxes is recorded in the financial statements.
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations - Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| J. | Forward Foreign Currency Contracts - The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
14 Invesco International Small-Mid Company Fund
forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| K. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2 - Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets* | Rate | |||
| Up to $500 million |
1.000 | % | ||
| Next $500 million |
0.950 | % | ||
| Next $4 billion |
0.920 | % | ||
| Next $5 billion |
0.900 | % | ||
| Next $10 billion |
0.880 | % | ||
| Over $20 billion |
0.870 | % | ||
| * | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.90%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through May 31, 2021, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit the total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.38%, 2.13%, 1.63%, 1.14%, 1.01%, and 0.96%, respectively, of the Fund’s average daily net assets (the “expense limits”). Effective June 1, 2021 through at least June 30, 2022, the Adviser has agreed to limit expenses for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.25%, 3.00%, 2.50%, 2.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waivers and/or expense reimbursement to exceed the numbers reflected above: (1) interest, facilities and maintenance fees; (2) taxes; (3) dividend expenses on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $34,184.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $22,326 in front-end sales commissions from the sale of Class A shares and $78 and $754 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
15 Invesco International Small-Mid Company Fund
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Investments in Securities |
||||||||||||||||
| Australia |
$ | – | $ | 427,310,415 | $– | $ | 427,310,415 | |||||||||
| Brazil |
123,707,067 | – | – | 123,707,067 | ||||||||||||
| Canada |
76,001,686 | – | – | 76,001,686 | ||||||||||||
| Denmark |
– | 261,912,456 | – | 261,912,456 | ||||||||||||
| Finland |
– | 47,325,243 | – | 47,325,243 | ||||||||||||
| France |
– | 237,034,509 | – | 237,034,509 | ||||||||||||
| Germany |
– | 756,144,285 | – | 756,144,285 | ||||||||||||
| Iceland |
– | 206,896,916 | – | 206,896,916 | ||||||||||||
| India |
– | 136,076,404 | – | 136,076,404 | ||||||||||||
| Ireland |
54,250,734 | – | – | 54,250,734 | ||||||||||||
| Israel |
169,481,685 | – | – | 169,481,685 | ||||||||||||
| Italy |
– | 288,409,829 | – | 288,409,829 | ||||||||||||
| Japan |
– | 1,639,203,475 | – | 1,639,203,475 | ||||||||||||
| Jersey |
– | 93,139,012 | – | 93,139,012 | ||||||||||||
| Netherlands |
– | 159,471,245 | – | 159,471,245 | ||||||||||||
| New Zealand |
– | 76,332,522 | – | 76,332,522 | ||||||||||||
| Norway |
– | 81,507,734 | – | 81,507,734 | ||||||||||||
| Spain |
– | 41,350,539 | – | 41,350,539 | ||||||||||||
| Sweden |
– | 981,813,254 | – | 981,813,254 | ||||||||||||
| Switzerland |
– | 866,347,835 | – | 866,347,835 | ||||||||||||
| United Kingdom |
21,733,124 | 1,483,116,445 | – | 1,504,849,569 | ||||||||||||
| United States |
65,307,714 | – | – | 65,307,714 | ||||||||||||
| Money Market Funds |
72,048,051 | – | – | 72,048,051 | ||||||||||||
| Total Investments in Securities |
582,530,061 | 7,783,392,118 | – | 8,365,922,179 | ||||||||||||
| Other Investments - Assets* |
||||||||||||||||
| Forward Foreign Currency Contracts |
– | 15,470 | – | 15,470 | ||||||||||||
| Total Investments |
$ | 582,530,061 | $ | 7,783,407,588 | $– | $ | 8,365,937,649 | |||||||||
| * | Unrealized appreciation. |
NOTE 4–Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
16 Invesco International Small-Mid Company Fund
Effect of Derivative Investments for the six months ended April 30, 2021
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
| Location of Gain on Statement of Operations |
||||
| Currency Risk |
||||
| Realized Gain |
||||
| Forward foreign currency contracts |
$7,909 | |||
| Change in Net Unrealized Appreciation: |
||||
| Forward foreign currency contracts |
15,470 | |||
| Total |
$23,379 | |||
The table below summarizes the average notional value of derivatives held during the period.
| Forward Foreign Currency Contracts | ||
| Average notional value |
$2,685,371 |
NOTE 5–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $1,845.
NOTE 6–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 8–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 9–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $1,219,017,575 and $1,333,927,021, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | |||||
| Aggregate unrealized appreciation of investments |
$ | 3,071,580,954 | |||
| Aggregate unrealized (depreciation) of investments |
(69,104,328 | ) | |||
| Net unrealized appreciation of investments |
$ | 3,002,476,626 | |||
Cost of investments for tax purposes is $5,363,461,023.
17 Invesco International Small-Mid Company Fund
NOTE 10–Share Information
| Summary of Share Activity |
||||||||||||||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 | |||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
| Sold: |
||||||||||||||||||||||||||||
| Class A |
1,015,000 | $ | 56,059,698 | 2,296,145 | $ | 106,337,027 | ||||||||||||||||||||||
| Class C |
444,084 | 21,589,025 | 107,287 | 4,388,339 | ||||||||||||||||||||||||
| Class R |
108,043 | 5,618,163 | 194,950 | 8,540,896 | ||||||||||||||||||||||||
| Class Y |
6,751,884 | 370,019,260 | 12,902,285 | 595,865,488 | ||||||||||||||||||||||||
| Class R5 |
3,921 | 207,493 | 3,377 | 150,580 | ||||||||||||||||||||||||
| Class R6 |
6,657,057 | 370,505,586 | 8,492,922 | 391,167,074 | ||||||||||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||||||||||||||
| Class A |
1,742,904 | 91,554,723 | 1,234,547 | 59,060,718 | ||||||||||||||||||||||||
| Class C |
252,489 | 11,728,099 | 194,910 | 8,392,805 | ||||||||||||||||||||||||
| Class R |
164,658 | 8,117,615 | 105,881 | 4,790,061 | ||||||||||||||||||||||||
| Class Y |
4,462,728 | 232,552,777 | 3,355,855 | 158,933,304 | ||||||||||||||||||||||||
| Class R5 |
554 | 29,282 | 10 | 497 | ||||||||||||||||||||||||
| Class R6 |
4,022,670 | 210,667,252 | 2,728,217 | 129,644,859 | ||||||||||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||||||||||||||
| Class A |
360,815 | 19,828,762 | 353,764 | 17,096,218 | ||||||||||||||||||||||||
| Class C |
(408,243 | ) | (19,828,762 | ) | (394,301 | ) | (17,096,218 | ) | ||||||||||||||||||||
| Reacquired: |
||||||||||||||||||||||||||||
| Class A |
(2,668,197 | ) | (147,284,406 | ) | (10,099,267 | ) | (455,635,588 | ) | ||||||||||||||||||||
| Class C |
(664,377 | ) | (32,351,226 | ) | (1,044,217 | ) | (42,137,001 | ) | ||||||||||||||||||||
| Class R |
(190,038 | ) | (9,848,203 | ) | (577,762 | ) | (25,310,283 | ) | ||||||||||||||||||||
| Class Y |
(8,004,257 | ) | (438,489,810 | ) | (38,648,222 | ) | (1,649,699,743 | ) | ||||||||||||||||||||
| Class R5 |
(730 | ) | (40,021 | ) | (130 | ) | (6,578 | ) | ||||||||||||||||||||
| Class R6 |
(5,588,766 | ) | (308,712,485 | ) | (19,689,164 | ) | (888,605,009 | ) | ||||||||||||||||||||
| Net increase (decrease) in share activity |
8,462,199 | $ | 441,922,822 | (38,482,913 | ) | $ | (1,594,122,554 | ) | ||||||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 36% of the outstanding shares of the Fund. The Fund and the Fund’s principal underwriter or adviser, are parties to participation agreements with these entities whereby these entities sell units of interest in separate accounts funding variable products that are invested in the Fund. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as, securities brokerage, third party record keeping and account servicing and administrative services. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
| In addition, 15% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
18 Invesco International Small-Mid Company Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
|
Beginning |
ACTUAL |
HYPOTHETICAL (5% annual return before expenses) |
Annualized | |||||||||
| Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 | |||||||||
|
Class A |
$1,000.00 | $1,190.80 | $7.22 | $1,018.20 | $6.66 | 1.33% | ||||||
|
Class C |
1,000.00 | 1,186.20 | 11.33 | 1,014.43 | 10.44 | 2.09 | ||||||
|
Class R |
1,000.00 | 1,189.10 | 8.63 | 1,016.91 | 7.95 | 1.59 | ||||||
|
Class Y |
1,000.00 | 1,192.10 | 5.92 | 1,019.39 | 5.46 | 1.09 | ||||||
|
Class R5 |
1,000.00 | 1,192.60 | 5.49 | 1,019.79 | 5.06 | 1.01 | ||||||
|
Class R6 |
1,000.00 | 1,192.90 | 5.17 | 1,020.08 | 4.76 | 0.95 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
19 Invesco International Small-Mid Company Fund
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Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov. corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
|
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | O-ISMC-SAR-1 | ||
|
| ||||
|
Semiannual Report to Shareholders | April 30, 2021 | ||
|
| ||||
| Invesco International Select Equity Fund | ||||
|
Nasdaq: |
||||
| A: IZIAX ∎ C: IZICX ∎ R: IZIRX ∎ Y: IZIYX ∎ R5: IZIFX ∎ R6: IZISX | ||||
| 2 | Fund Performance | |||||
| 4 | Liquidity Risk Management Program | |||||
| 5 | Schedule of Investments | |||||
| 7 | Financial Statements | |||||
| 10 | Financial Highlights | |||||
| 11 | Notes to Financial Statements | |||||
| 16 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
| 2 | Invesco International Select Equity Fund |
| 3 | Invesco International Select Equity Fund |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
| 4 | Invesco International Select Equity Fund |
April 30, 2021
(Unaudited)
Investment Abbreviations:
ADR – American Depositary Receipt
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 5 | Invesco International Select Equity Fund |
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, 2021. |
| (c) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $35,012,694, which represented 12.20% of the Fund’s Net Assets. |
| (d) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ | 4,062,975 | $ | 20,799,938 | $ | (21,746,816 | ) | $ | - | $ | - | $ | 3,116,097 | $ | 494 | ||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
2,895,665 | 14,857,098 | (15,533,440 | ) | 235 | (309 | ) | 2,219,249 | 668 | ||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
4,643,401 | 23,771,358 | (24,853,505 | ) | - | - | 3,561,254 | 231 | |||||||||||||||||||||||||||
| Investments Purchased with Cash Collateral from Securities on Loan: | |||||||||||||||||||||||||||||||||||
| Invesco Private Government Fund |
- | 399,924 | (375,308 | ) | - | - | 24,616 | 2* | |||||||||||||||||||||||||||
| Invesco Private Prime Fund |
- | 592,266 | (556,482 | ) | - | - | 35,784 | 21* | |||||||||||||||||||||||||||
| Total |
$ | 11,602,041 | $ | 60,420,584 | $ | (63,065,551 | ) | $ | 235 | $ | (309 | ) | $ | 8,957,000 | $ | 1,416 | |||||||||||||||||||
| * | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
| (e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| (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 1I. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Consumer Discretionary |
32.98 | % | |||
| Communication Services |
19.99 | ||||
| Industrials |
15.07 | ||||
| Information Technology |
9.34 | ||||
| Health Care |
6.92 | ||||
| Consumer Staples |
5.04 | ||||
| Real Estate |
2.91 | ||||
| Financials |
2.66 | ||||
| Materials |
2.06 | ||||
| Money Market Funds Plus Other Assets Less Liabilities |
3.03 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 6 | Invesco International Select Equity Fund |
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 7 | Invesco International Select Equity Fund |
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $121,426) |
$ | 937,665 | ||
|
|
||||
| Non-cash dividend income |
166,184 | |||
|
|
||||
| Dividends from affiliated money market funds (includes securities lending income of $279) |
1,672 | |||
|
|
||||
| Total investment income |
1,105,521 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
1,173,395 | |||
|
|
||||
| Administrative services fees |
19,499 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
21,614 | |||
|
|
||||
| Class C |
4,581 | |||
|
|
||||
| Class R |
1,260 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
26,206 | |||
|
|
||||
| Transfer agent fees – R6 |
85 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
13,481 | |||
|
|
||||
| Registration and filing fees |
38,201 | |||
|
|
||||
| Reports to shareholders |
6,381 | |||
|
|
||||
| Professional services fees |
33,433 | |||
|
|
||||
| Other |
2,003 | |||
|
|
||||
| Total expenses |
1,340,139 | |||
|
|
||||
| Less: Fees waived and/or expenses reimbursed |
(224,962 | ) | ||
|
|
||||
| Net expenses |
1,115,177 | |||
|
|
||||
| Net investment income (loss) |
(9,656 | ) | ||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
13,849,668 | |||
|
|
||||
| Affiliated investment securities |
(309 | ) | ||
|
|
||||
| Foreign currencies |
(6,158 | ) | ||
|
|
||||
| 13,843,201 | ||||
|
|
||||
| Change in net unrealized appreciation (depreciation) of: |
||||
| Unaffiliated investment securities |
26,806,561 | |||
|
|
||||
| Affiliated investment securities |
235 | |||
|
|
||||
| Foreign currencies |
(1,791 | ) | ||
|
|
||||
| 26,805,005 | ||||
|
|
||||
| Net realized and unrealized gain |
40,648,206 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 40,638,550 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 8 | Invesco International Select Equity Fund |
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income (loss) |
$ | (9,656 | ) | $ | (242,489 | ) | ||
|
|
||||||||
| Net realized gain |
13,843,201 | 533,783 | ||||||
|
|
||||||||
| Change in net unrealized appreciation |
26,805,005 | 26,539,955 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
40,638,550 | 26,831,249 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
– | (119,834 | ) | |||||
|
|
||||||||
| Class C |
– | (10,848 | ) | |||||
|
|
||||||||
| Class R |
– | (4,091 | ) | |||||
|
|
||||||||
| Class Y |
– | (72,461 | ) | |||||
|
|
||||||||
| Class R5 |
– | (257 | ) | |||||
|
|
||||||||
| Class R6 |
– | (2,419,527 | ) | |||||
|
|
||||||||
| Total distributions from distributable earnings |
– | (2,627,018 | ) | |||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
9,953,510 | 2,902,705 | ||||||
|
|
||||||||
| Class C |
(28,774 | ) | (138,544 | ) | ||||
|
|
||||||||
| Class R |
382,103 | 20,555 | ||||||
|
|
||||||||
| Class Y |
2,728,526 | 144,870 | ||||||
|
|
||||||||
| Class R6 |
20,807,042 | 63,982,441 | ||||||
|
|
||||||||
| Net increase in net assets resulting from share transactions |
33,842,407 | 66,912,027 | ||||||
|
|
||||||||
| Net increase in net assets |
74,480,957 | 91,116,258 | ||||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
212,568,140 | 121,451,882 | ||||||
|
|
||||||||
| End of period |
$ | 287,049,097 | $ | 212,568,140 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 9 | Invesco International Select Equity Fund |
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period |
Total return(b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average net assets with fee waivers and/or expenses absorbed |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed |
Ratio of net investment income (loss) to average net assets |
Portfolio turnover(c) |
|||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 13.54 | $ | (0.02 | ) | $ | 2.59 | $ | 2.57 | $ | – | $ | – | $ | – | $ | 16.11 | 18.98 | % | $ | 22,130 | 1.12 | %(d) | 1.49 | %(d) | (0.24 | )%(d) | 25% | ||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.49 | (0.05 | ) | 2.33 | 2.28 | (0.23 | ) | – | (0.23 | ) | 13.54 | 20.15 | 10,027 | 1.12 | 1.60 | (0.41 | ) | 59 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.52 | 0.22 | (e) | 1.42 | 1.64 | (0.07 | ) | (0.60 | ) | (0.67 | ) | 11.49 | 16.99 | 5,852 | 1.11 | 1.60 | 2.06 | (e) | 35 | |||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
13.01 | 0.09 | (1.51 | ) | (1.42 | ) | (0.10 | ) | (0.97 | ) | (1.07 | ) | 10.52 | (11.93 | ) | 4,333 | 1.11 | 1.62 | 0.72 | 46 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.98 | 0.08 | 2.41 | 2.49 | (0.10 | ) | (0.36 | ) | (0.46 | ) | 13.01 | 23.77 | 5,436 | 1.14 | 1.70 | 0.71 | 43 | |||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(f) |
10.00 | 0.07 | 0.91 | 0.98 | – | – | – | 10.98 | 9.80 | 3,378 | 1.32 | (g) | 1.90 | (g) | 0.81 | (g) | 35 | |||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
13.28 | (0.08 | ) | 2.56 | 2.48 | – | – | – | 15.76 | 18.67 | 913 | 1.87 | (d) | 2.24 | (d) | (0.99 | )(d) | 25 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.28 | (0.13 | ) | 2.28 | 2.15 | (0.15 | ) | – | (0.15 | ) | 13.28 | 19.22 | 792 | 1.87 | 2.35 | (1.16 | ) | 59 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.35 | 0.14 | (e) | 1.39 | 1.53 | – | (0.60 | ) | (0.60 | ) | 11.28 | 16.03 | 811 | 1.86 | 2.35 | 1.31 | (e) | 35 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.86 | (0.00 | ) | (1.48 | ) | (1.48 | ) | (0.06 | ) | (0.97 | ) | (1.03 | ) | 10.35 | (12.55 | ) | 1,192 | 1.86 | 2.37 | (0.03 | ) | 46 | ||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.91 | (0.00 | ) | 2.38 | 2.38 | (0.07 | ) | (0.36 | ) | (0.43 | ) | 12.86 | 22.88 | 2,167 | 1.89 | 2.45 | (0.04 | ) | 43 | |||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(f) |
10.00 | 0.01 | 0.90 | 0.91 | – | – | – | 10.91 | 9.10 | 50 | 2.07 | (g) | 2.65 | (g) | 0.06 | (g) | 35 | |||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
13.44 | (0.04 | ) | 2.58 | 2.54 | – | – | – | 15.98 | 18.90 | 734 | 1.37 | (d) | 1.74 | (d) | (0.49 | )(d) | 25 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.41 | (0.08 | ) | 2.32 | 2.24 | (0.21 | ) | – | (0.21 | ) | 13.44 | 19.85 | 290 | 1.37 | 1.85 | (0.66 | ) | 59 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.46 | 0.19 | (e) | 1.40 | 1.59 | (0.04 | ) | (0.60 | ) | (0.64 | ) | 11.41 | 16.60 | 227 | 1.36 | 1.85 | 1.81 | (e) | 35 | |||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.95 | 0.06 | (1.49 | ) | (1.43 | ) | (0.09 | ) | (0.97 | ) | (1.06 | ) | 10.46 | (12.09 | ) | 89 | 1.36 | 1.87 | 0.47 | 46 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.95 | 0.05 | 2.40 | 2.45 | (0.09 | ) | (0.36 | ) | (0.45 | ) | 12.95 | 23.44 | 61 | 1.39 | 1.95 | 0.46 | 43 | |||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(f) |
10.00 | 0.05 | 0.90 | 0.95 | – | – | – | 10.95 | 9.50 | 15 | 1.57 | (g) | 2.15 | (g) | 0.56 | (g) | 35 | |||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
13.57 | 0.00 | 2.60 | 2.60 | – | – | – | 16.17 | 19.16 | 7,455 | 0.87 | (d) | 1.24 | (d) | 0.01 | (d) | 25 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.51 | (0.02 | ) | 2.34 | 2.32 | (0.26 | ) | – | (0.26 | ) | 13.57 | 20.46 | 3,926 | 0.87 | 1.35 | (0.16 | ) | 59 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.56 | 0.25 | (e) | 1.41 | 1.66 | (0.11 | ) | (0.60 | ) | (0.71 | ) | 11.51 | 17.24 | 3,299 | 0.86 | 1.35 | 2.31 | (e) | 35 | |||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
13.04 | 0.12 | (1.51 | ) | (1.39 | ) | (0.12 | ) | (0.97 | ) | (1.09 | ) | 10.56 | (11.68 | ) | 8,594 | 0.86 | 1.37 | 0.97 | 46 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
11.00 | 0.11 | 2.40 | 2.51 | (0.11 | ) | (0.36 | ) | (0.47 | ) | 13.04 | 24.04 | 7,499 | 0.89 | 1.45 | 0.96 | 43 | |||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(f) |
10.00 | 0.10 | 0.90 | 1.00 | – | – | – | 11.00 | 10.00 | 2,810 | 1.07 | (g) | 1.65 | (g) | 1.06 | (g) | 35 | |||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
13.57 | 0.00 | 2.60 | 2.60 | – | – | – | 16.17 | 19.16 | 16 | 0.87 | (d) | 1.02 | (d) | 0.01 | (d) | 25 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.51 | (0.02 | ) | 2.34 | 2.32 | (0.26 | ) | – | (0.26 | ) | 13.57 | 20.46 | 14 | 0.87 | 1.12 | (0.16 | ) | 59 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.56 | 0.25 | (e) | 1.41 | 1.66 | (0.11 | ) | (0.60 | ) | (0.71 | ) | 11.51 | 17.23 | 12 | 0.86 | 1.14 | 2.31 | (e) | 35 | |||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
13.04 | 0.12 | (1.51 | ) | (1.39 | ) | (0.12 | ) | (0.97 | ) | (1.09 | ) | 10.56 | (11.68 | ) | 11 | 0.86 | 1.19 | 0.97 | 46 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
11.00 | 0.11 | 2.40 | 2.51 | (0.11 | ) | (0.36 | ) | (0.47 | ) | 13.04 | 24.04 | 13 | 0.89 | 1.30 | 0.96 | 43 | |||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(f) |
10.00 | 0.10 | 0.90 | 1.00 | – | – | – | 11.00 | 10.00 | 11 | 1.07 | (g) | 1.61 | (g) | 1.06 | (g) | 35 | |||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
13.56 | 0.00 | 2.61 | 2.61 | – | – | – | 16.17 | 19.25 | 255,800 | 0.87 | (d) | 1.02 | (d) | 0.01 | (d) | 25 | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.51 | (0.02 | ) | 2.33 | 2.31 | (0.26 | ) | – | (0.26 | ) | 13.56 | 20.37 | 197,521 | 0.87 | 1.12 | (0.16 | ) | 59 | ||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
10.56 | 0.25 | (e) | 1.41 | 1.66 | (0.11 | ) | (0.60 | ) | (0.71 | ) | 11.51 | 17.24 | 111,252 | 0.86 | 1.14 | 2.31 | (e) | 35 | |||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
13.03 | 0.12 | (1.50 | ) | (1.38 | ) | (0.12 | ) | (0.97 | ) | (1.09 | ) | 10.56 | (11.61 | ) | 103,172 | 0.86 | 1.19 | 0.97 | 46 | ||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
11.00 | 0.11 | 2.39 | 2.50 | (0.11 | ) | (0.36 | ) | (0.47 | ) | 13.03 | 23.94 | 91,527 | 0.89 | 1.30 | 0.96 | 43 | |||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(f) |
10.00 | 0.10 | 0.90 | 1.00 | – | – | – | 11.00 | 10.00 | 52,208 | 1.07 | (g) | 1.61 | (g) | 1.06 | (g) | 35 | |||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $17,434, $924, $508, $5,255, $16 and $229,021 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (e) | Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets includes significant dividends received during year ended October 31, 2019. Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets excluding the significant dividends are $0.06 and 0.57%, $(0.02) and (0.18)%, $0.03 and 0.32%, $0.09 and 0.82%, $0.09 and 0.82%, and $0.09 and 0.82% for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (f) | Commencement date of December 21, 2015. |
| (g) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 10 | Invesco International Select Equity Fund |
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco International Select Equity Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. The Fund is classified as non-diversified. The Fund’s classification changed from diversified to non-diversified during the period. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
| 11 | Invesco International Select Equity Fund |
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date.
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy 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. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the 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. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. 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. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The 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 Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
| J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
| 12 | Invesco International Select Equity Fund |
foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates.
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| L. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
| M. | Other Risks – The Fund is non-diversified and may invest in securities of fewer issuers than if it were diversified. Thus, the value of the Fund’s shares may vary more widely and the Fund may be subject to greater market and credit risk than if the Fund invested more broadly. |
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets | Rate | |||
|
|
||||
| First $250 million |
0.935% | |||
|
|
||||
| Next $250 million |
0.910% | |||
|
|
||||
| Next $500 million |
0.885% | |||
|
|
||||
| Next $1.5 billion |
0.860% | |||
|
|
||||
| Next $2.5 billion |
0.835% | |||
|
|
||||
| Next $2.5 billion |
0.810% | |||
|
|
||||
| Next $2.5 billion |
0.785% | |||
|
|
||||
| Over $10 billion |
0.760% | |||
|
|
||||
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.93% .
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.12%, 1.87%, 1.37%, 0.87%, 0.87% and 0.87%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limit, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
The Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $198,671 and reimbursed class level expenses of $18,947, $1,007, $552, $5,700, $0 and $85 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services.
| 13 | Invesco International Select Equity Fund |
IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $2,869 in front-end sales commissions from the sale of Class A shares and $532 and $194 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $761 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Investments in Securities |
||||||||||||||||
| Australia |
$ | – | $ | 11,103,485 | $ | – | $ | 11,103,485 | ||||||||
| Belgium |
– | 7,303,851 | – | 7,303,851 | ||||||||||||
| Canada |
12,774,925 | – | – | 12,774,925 | ||||||||||||
| China |
38,422,935 | 52,195,837 | – | 90,618,772 | ||||||||||||
| Denmark |
– | 4,898,046 | – | 4,898,046 | ||||||||||||
| Finland |
– | 6,921,089 | – | 6,921,089 | ||||||||||||
| France |
– | 13,484,651 | – | 13,484,651 | ||||||||||||
| Germany |
– | 24,604,488 | – | 24,604,488 | ||||||||||||
| Hong Kong |
– | 7,627,422 | – | 7,627,422 | ||||||||||||
| Japan |
– | 29,141,958 | – | 29,141,958 | ||||||||||||
| Luxembourg |
– | 10,293,993 | – | 10,293,993 | ||||||||||||
| Macau |
– | 17,908,823 | – | 17,908,823 | ||||||||||||
| Netherlands |
– | 8,349,106 | – | 8,349,106 | ||||||||||||
| South Korea |
– | 7,048,135 | – | 7,048,135 | ||||||||||||
| Spain |
– | 3,677,190 | – | 3,677,190 | ||||||||||||
| United Kingdom |
4,129,123 | 18,456,992 | – | 22,586,115 | ||||||||||||
| Money Market Funds |
8,896,600 | 60,400 | – | 8,957,000 | ||||||||||||
| Total Investments |
$ | 64,223,583 | $ | 223,075,466 | $ | – | $ | 287,299,049 | ||||||||
NOTE 4–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 5–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund
| 14 | Invesco International Select Equity Fund |
may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 6–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2020, as follows:
| Capital Loss Carryforward* | ||||||||||||
| Expiration |
Short-Term | Long-Term | Total | |||||||||
| Not subject to expiration |
$— | $1,963,423 | $1,963,423 | |||||||||
|
|
||||||||||||
| * | Capital loss carryforward 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
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $95,793,030 and $59,506,463, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis |
| |||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 68,529,275 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(3,247,413 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 65,281,862 | ||
|
|
||||
Cost of investments for tax purposes is $222,017,187.
NOTE 8–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended | Year ended | |||||||||||||||
| April 30, 2021(a) | October 31, 2020 | |||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
741,225 | $ | 11,656,363 | 542,344 | $ | 6,391,283 | ||||||||||
|
|
||||||||||||||||
| Class C |
14,980 | 231,597 | 22,898 | 259,990 | ||||||||||||
|
|
||||||||||||||||
| Class R |
26,497 | 415,631 | 7,869 | 93,582 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
212,138 | 3,364,322 | 164,218 | 1,836,390 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
1,864,518 | 30,225,781 | 10,757,097 | 135,655,541 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
- | - | 9,178 | 108,578 | ||||||||||||
|
|
||||||||||||||||
| Class C |
- | - | 925 | 10,796 | ||||||||||||
|
|
||||||||||||||||
| Class R |
- | - | 330 | 3,885 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
- | - | 5,899 | 69,729 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
- | - | 204,676 | 2,419,270 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
3,101 | 48,258 | 152 | 1,730 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(3,166 | ) | (48,258 | ) | (154 | ) | (1,730 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(111,762 | ) | (1,751,111 | ) | (320,234 | ) | (3,598,886 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(13,506 | ) | (212,113 | ) | (35,893 | ) | (407,600 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(2,094 | ) | (33,528 | ) | (6,509 | ) | (76,912 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(40,529 | ) | (635,796 | ) | (167,457 | ) | (1,761,249 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(606,491 | ) | (9,418,739 | ) | (6,067,824 | ) | (74,092,370 | ) | ||||||||
|
|
||||||||||||||||
| Net increase in share activity |
2,084,911 | $ | 33,842,407 | 5,117,515 | $ | 66,912,027 | ||||||||||
|
|
||||||||||||||||
| (a) | 88% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
| 15 | Invesco International Select Equity Fund |
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL (5% annual return before expenses) |
|||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Expense Ratio | |||||||
|
Class A |
$1,000.00 | $1,189.80 | $6.08 | $1,019.24 | $5.61 | 1.12% | ||||||
|
Class C |
1,000.00 | 1,186.70 | 10.14 | 1,015.52 | 9.35 | 1.87 | ||||||
|
Class R |
1,000.00 | 1,189.00 | 7.44 | 1,018.00 | 6.85 | 1.37 | ||||||
|
Class Y |
1,000.00 | 1,191.60 | 4.73 | 1,020.48 | 4.36 | 0.87 | ||||||
|
Class R5 |
1,000.00 | 1,191.60 | 4.73 | 1,020.48 | 4.36 | 0.87 | ||||||
|
Class R6 |
1,000.00 | 1,192.50 | 4.73 | 1,020.48 | 4.36 | 0.87 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
| 16 | Invesco International Select Equity Fund |
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
|
SEC file numbers: 811-06463 and 033-44611 Invesco Distributors, Inc. ICO-SAR-1
|
| ||||
|
Semiannual Report to Shareholders |
April 30, 2021 | ||
|
| ||||
| Invesco MSCI World SRI Index Fund | ||||
|
Nasdaq: |
||||
| A: VSQAX ∎ C: VSQCX ∎ R: VSQRX ∎ Y: VSQYX ∎ R5: VSQFX ∎ R6: VSQSX | ||||
| 2 | Fund Performance | |||||
| 4 | Liquidity Risk Management Program | |||||
| 5 | Schedule of Investments | |||||
| 10 | Financial Statements | |||||
| 13 | Financial Highlights | |||||
| 14 | Notes to Financial Statements | |||||
| 20 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
| Performance summary |
| |||
| Fund vs. Indexes |
||||
| Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
| Class A Shares |
26.43 | % | ||
| Class C Shares |
25.93 | |||
| Class R Shares |
26.22 | |||
| Class Y Shares |
26.63 | |||
| Class R5 Shares |
26.63 | |||
| Class R6 Shares |
26.63 | |||
| MSCI World SRI Index▼ (Broad Market Index) |
26.60 | |||
| Custom Invesco MSCI World SRI Index∎ (Style-Specific Index) |
26.60 | |||
| Lipper Global Multi-Cap Core Funds Index◆ (Peer Group Index) |
30.35 | |||
| Source(s): ▼RIMES Technologies Corp.; ∎Invesco, RIMES Technologies Corp.; ◆Lipper Inc. |
| |||
|
The MSCI World SRI Index is an unmanaged index composed of developed countries’ large- and mid-cap stocks with high ESG rating as determined by MSCI ESG Research. The index is computed using the net return, which withholds applicable taxes for non-resident investors. The Custom Invesco MSCI World SRI Index is comprised of the MSCI World Index through June 30, 2020, and the MSCI World SRI Index thereafter. The Lipper Global Multi-Cap Core Funds Index is an unmanaged index considered representative of global multi-cap core funds tracked by Lipper. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
| |||
| For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends. |
| 2 | Invesco MSCI World SRI Index Fund |
| 3 | Invesco MSCI World SRI Index Fund |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
| 4 | Invesco MSCI World SRI Index Fund |
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 5 | Invesco MSCI World SRI Index Fund |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 6 | Invesco MSCI World SRI Index Fund |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 7 | Invesco MSCI World SRI Index Fund |
Notes to Schedule of Investments:
| (a) | Non-income producing security. |
| (b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $25,134, which represented less than 1% of the Fund’s Net Assets. |
| (c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ | 47,900 | $ | 436,534 | $ | (288,366 | ) | $ | - | $ | - | $ | 196,068 | $ | 15 | ||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
34,477 | 311,810 | (205,975 | ) | - | - | 140,312 | 14 | |||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
54,743 | 498,896 | (329,561 | ) | - | - | 224,078 | 7 | |||||||||||||||||||||||||||
| Total |
$ | 137,120 | $ | 1,247,240 | $ | (823,902 | ) | $ | - | $ | - | $ | 560,458 | $ | 36 | ||||||||||||||||||||
| (d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| Open Futures Contracts(a) | |||||||||||||||||||||||||
| Long Futures Contracts | Number of Contracts |
Expiration Month |
Notional Value |
Value | Unrealized Appreciation | ||||||||||||||||||||
| Equity Risk |
|||||||||||||||||||||||||
| MSCI World Index |
5 | June-2021 | $ | 439,700 | $ | 7,982 | $ | 7,982 | |||||||||||||||||
| (a) | Futures contracts collateralized by $31,370 cash held with Meril Lynch International, the futures commission merchant. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 8 | Invesco MSCI World SRI Index Fund |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Information Technology | 22.15 | % | ||
| Consumer Discretionary | 13.24 | |||
| Financials | 12.93 | |||
| Health Care | 12.12 | |||
| Industrials | 10.77 | |||
| Consumer Staples | 8.68 | |||
| Materials | 5.00 | |||
| Communication Services | 4.25 | |||
| Real Estate | 3.13 | |||
| Other Sectors, Each Less than 2% of Net Assets | 2.46 | |||
| Money Market Funds Plus Other Assets Less Liabilities | 5.27 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 9 | Invesco MSCI World SRI Index Fund |
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 10 | Invesco MSCI World SRI Index Fund |
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $ 5,559) |
$ | 78,605 | ||
|
|
||||
| Dividends from affiliated money market funds |
36 | |||
|
|
||||
| Total investment income |
78,641 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
6,899 | |||
|
|
||||
| Administrative services fees |
646 | |||
|
|
||||
| Custodian fees |
1,654 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
1,368 | |||
|
|
||||
| Class C |
844 | |||
|
|
||||
| Class R |
1,004 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
4,303 | |||
|
|
||||
| Transfer agent fees – R5 |
10 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
8,786 | |||
|
|
||||
| Registration and filing fees |
42,632 | |||
|
|
||||
| Licensing fees |
1,971 | |||
|
|
||||
| Reports to shareholders |
26,034 | |||
|
|
||||
| Professional services fees |
110,484 | |||
|
|
||||
| Other |
9,062 | |||
|
|
||||
| Total expenses |
215,697 | |||
|
|
||||
| Less: Fees waived and/or expenses reimbursed |
(203,190 | ) | ||
|
|
||||
| Net expenses |
12,507 | |||
|
|
||||
| Net investment income |
66,134 | |||
|
|
||||
| Realized and unrealized gain from: |
||||
| Net realized gain from: |
||||
| Unaffiliated investment securities |
37,773 | |||
|
|
||||
| Foreign currencies |
774 | |||
|
|
||||
| Futures contracts |
26,912 | |||
|
|
||||
| 65,459 | ||||
|
|
||||
| Change in net unrealized appreciation of: |
||||
| Unaffiliated investment securities |
2,078,882 | |||
|
|
||||
| Foreign currencies |
188 | |||
|
|
||||
| Futures contracts |
9,245 | |||
|
|
||||
| 2,088,315 | ||||
|
|
||||
| Net realized and unrealized gain |
2,153,774 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 2,219,908 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 11 | Invesco MSCI World SRI Index Fund |
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
|
|
||||||||
| Operations: |
||||||||
| Net investment income |
$ | 66,134 | $ | 142,483 | ||||
|
|
||||||||
| Net realized gain (loss) |
65,459 | (274,967 | ) | |||||
|
|
||||||||
| Change in net unrealized appreciation |
2,088,315 | 150,487 | ||||||
|
|
||||||||
| Net increase in net assets resulting from operations |
2,219,908 | 18,003 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(15,067 | ) | (27,376 | ) | ||||
|
|
||||||||
| Class C |
(2,386 | ) | (2,218 | ) | ||||
|
|
||||||||
| Class R |
(5,252 | ) | (492 | ) | ||||
|
|
||||||||
| Class Y |
(7,779 | ) | (9,965 | ) | ||||
|
|
||||||||
| Class R5 |
(374 | ) | (389 | ) | ||||
|
|
||||||||
| Class R6 |
(107,235 | ) | (118,725 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(138,093 | ) | (159,165 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
47,392 | (411,764 | ) | |||||
|
|
||||||||
| Class C |
(17,701 | ) | (78,067 | ) | ||||
|
|
||||||||
| Class R |
70,381 | 273,845 | ||||||
|
|
||||||||
| Class Y |
132,781 | (54,620 | ) | |||||
|
|
||||||||
| Class R5 |
403 | 1,201 | ||||||
|
|
||||||||
| Class R6 |
554,924 | (18,698 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
788,180 | (288,103 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets |
2,869,995 | (429,265 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
8,254,301 | 8,683,566 | ||||||
|
|
||||||||
| End of period |
$ | 11,124,296 | $ | 8,254,301 | ||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 12 | Invesco MSCI World SRI Index Fund |
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period |
Total return(b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average net assets with fee waivers and/or expenses absorbed |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed |
Ratio of net investment income to average net assets |
Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 11.78 | $ | 0.08 | $ | 3.01 | $ | 3.09 | $ | (0.19 | ) | $ | – | $ | (0.19 | ) | $ | 14.68 | 26.43 | % | $ | 1,201 | 0.44 | %(d) | 4.86 | %(d) | 1.16 | %(d) | 4 | % | ||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.86 | 0.17 | (0.06 | ) | 0.11 | (0.19 | ) | – | (0.19 | ) | 11.78 | 0.89 | 922 | 0.70 | 3.03 | 1.48 | 118 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
11.76 | 0.17 | 0.21 | 0.38 | (0.18 | ) | (0.10 | ) | (0.28 | ) | 11.86 | 3.48 | 1,483 | 0.85 | 3.58 | 1.51 | 116 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.91 | 0.17 | (0.85 | ) | (0.68 | ) | (0.09 | ) | (0.38 | ) | (0.47 | ) | 11.76 | (5.55 | ) | 1,387 | 0.84 | 3.94 | 1.33 | 89 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.45 | 0.14 | 2.39 | 2.53 | (0.06 | ) | (0.01 | ) | (0.07 | ) | 12.91 | 24.36 | 531 | 0.84 | 9.90 | 1.16 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(e) |
10.17 | 0.04 | 0.24 | 0.28 | – | – | – | 10.45 | 2.75 | 46 | 0.84 | (f) | 31.57 | (f) | 1.13 | (f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
11.67 | 0.03 | 2.98 | 3.01 | (0.18 | ) | – | (0.18 | ) | 14.50 | 25.93 | 177 | 1.19 | (d) | 5.61 | (d) | 0.41 | (d) | 4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.75 | 0.08 | (0.05 | ) | 0.03 | (0.11 | ) | – | (0.11 | ) | 11.67 | 0.21 | 158 | 1.45 | 3.78 | 0.73 | 118 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
11.63 | 0.09 | 0.20 | 0.29 | (0.07 | ) | (0.10 | ) | (0.17 | ) | 11.75 | 2.66 | 243 | 1.60 | 4.33 | 0.76 | 116 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.83 | 0.07 | (0.84 | ) | (0.77 | ) | (0.05 | ) | (0.38 | ) | (0.43 | ) | 11.63 | (6.27 | ) | 166 | 1.59 | 4.69 | 0.58 | 89 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.42 | 0.05 | 2.39 | 2.44 | (0.02 | ) | (0.01 | ) | (0.03 | ) | 12.83 | 23.49 | 124 | 1.59 | 10.65 | 0.41 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(e) |
10.17 | 0.01 | 0.24 | 0.25 | – | – | – | 10.42 | 2.46 | 10 | 1.59 | (f) | 32.32 | (f) | 0.38 | (f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
11.74 | 0.06 | 3.00 | 3.06 | (0.19 | ) | – | (0.19 | ) | 14.61 | 26.22 | 479 | 0.69 | (d) | 5.11 | (d) | 0.91 | (d) | 4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.81 | 0.15 | (0.06 | ) | 0.09 | (0.16 | ) | – | (0.16 | ) | 11.74 | 0.74 | 325 | 0.95 | 3.28 | 1.23 | 118 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
11.71 | 0.15 | 0.20 | 0.35 | (0.15 | ) | (0.10 | ) | (0.25 | ) | 11.81 | 3.17 | 35 | 1.10 | 3.83 | 1.26 | 116 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.88 | 0.14 | (0.85 | ) | (0.71 | ) | (0.08 | ) | (0.38 | ) | (0.46 | ) | 11.71 | (5.82 | ) | 32 | 1.09 | 4.19 | 1.08 | 89 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.44 | 0.11 | 2.39 | 2.50 | (0.05 | ) | (0.01 | ) | (0.06 | ) | 12.88 | 24.04 | 13 | 1.09 | 10.15 | 0.91 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(e) |
10.17 | 0.03 | 0.24 | 0.27 | – | – | – | 10.44 | 2.65 | 10 | 1.09 | (f) | 31.82 | (f) | 0.88 | (f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
11.83 | 0.10 | 3.03 | 3.13 | (0.20 | ) | – | (0.20 | ) | 14.76 | 26.63 | 739 | 0.19 | (d) | 4.61 | (d) | 1.41 | (d) | 4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.91 | 0.20 | (0.06 | ) | 0.14 | (0.22 | ) | – | (0.22 | ) | 11.83 | 1.11 | 485 | 0.45 | 2.78 | 1.73 | 118 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
11.80 | 0.20 | 0.22 | 0.42 | (0.21 | ) | (0.10 | ) | (0.31 | ) | 11.91 | 3.80 | 522 | 0.60 | 3.33 | 1.76 | 116 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.94 | 0.20 | (0.86 | ) | (0.66 | ) | (0.10 | ) | (0.38 | ) | (0.48 | ) | 11.80 | (5.39 | ) | 446 | 0.59 | 3.69 | 1.58 | 89 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.46 | 0.17 | 2.39 | 2.56 | (0.07 | ) | (0.01 | ) | (0.08 | ) | 12.94 | 24.67 | 189 | 0.59 | 9.65 | 1.41 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(e) |
10.17 | 0.05 | 0.24 | 0.29 | – | – | – | 10.46 | 2.85 | 42 | 0.59 | (f) | 31.32 | (f) | 1.38 | (f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
11.83 | 0.10 | 3.03 | 3.13 | (0.20 | ) | – | (0.20 | ) | 14.76 | 26.63 | 28 | 0.19 | (d) | 4.30 | (d) | 1.41 | (d) | 4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.90 | 0.20 | (0.05 | ) | 0.15 | (0.22 | ) | – | (0.22 | ) | 11.83 | 1.20 | 22 | 0.45 | 2.56 | 1.73 | 118 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
11.80 | 0.20 | 0.21 | 0.41 | (0.21 | ) | (0.10 | ) | (0.31 | ) | 11.90 | 3.71 | 21 | 0.60 | 2.95 | 1.76 | 116 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.94 | 0.20 | (0.86 | ) | (0.66 | ) | (0.10 | ) | (0.38 | ) | (0.48 | ) | 11.80 | (5.39 | ) | 19 | 0.59 | 3.47 | 1.58 | 89 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.46 | 0.17 | 2.39 | 2.56 | (0.07 | ) | (0.01 | ) | (0.08 | ) | 12.94 | 24.67 | 21 | 0.59 | 9.28 | 1.41 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(e) |
10.17 | 0.05 | 0.24 | 0.29 | – | – | – | 10.46 | 2.85 | 10 | 0.59 | (f) | 29.53 | (f) | 1.38 | (f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
11.83 | 0.10 | 3.03 | 3.13 | (0.20 | ) | – | (0.20 | ) | 14.76 | 26.63 | 8,501 | 0.19 | (d) | 4.22 | (d) | 1.41 | (d) | 4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
11.90 | 0.20 | (0.05 | ) | 0.15 | (0.22 | ) | – | (0.22 | ) | 11.83 | 1.20 | 6,342 | 0.45 | 2.51 | 1.73 | 118 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/19 |
11.80 | 0.20 | 0.21 | 0.41 | (0.21 | ) | (0.10 | ) | (0.31 | ) | 11.90 | 3.71 | 6,379 | 0.60 | 2.91 | 1.76 | 116 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/18 |
12.94 | 0.20 | (0.86 | ) | (0.66 | ) | (0.10 | ) | (0.38 | ) | (0.48 | ) | 11.80 | (5.39 | ) | 6,875 | 0.59 | 3.42 | 1.58 | 89 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/17 |
10.46 | 0.17 | 2.39 | 2.56 | (0.07 | ) | (0.01 | ) | (0.08 | ) | 12.94 | 24.67 | 4,935 | 0.59 | 9.28 | 1.41 | 69 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/16(e) |
10.17 | 0.05 | 0.24 | 0.29 | – | – | – | 10.46 | 2.85 | 1,353 | 0.59 | (f) | 29.53 | (f) | 1.38 | (f) | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $1,104, $170, $405, $563, $26 and $7,670 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (e) | Commencement date of July 1, 2016. |
| (f) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
| 13 | Invesco MSCI World SRI Index Fund |
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco MSCI World SRI Index Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
| 14 | Invesco MSCI World SRI Index Fund |
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| J. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with
| 15 | Invesco MSCI World SRI Index Fund |
forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| K. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets | Rate | |||
|
|
||||
| First $2 billion |
0.140% | |||
|
|
||||
| Over $2 billion |
0.120% | |||
|
|
||||
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.14%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2022, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 0.44%, 1.19%, 0.69%, 0.19%, 0.19%, and 0.19%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limit, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $6,899, reimbursed fund level expenses of $191,979 and reimbursed class level expenses of $2,122, $328, $776, $1,076, $10 and $0 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–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. |
| 16 | Invesco MSCI World SRI Index Fund |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Investments in Securities |
||||||||||||||||
| Australia |
$ | – | $ | 195,921 | $ | – | $ | 195,921 | ||||||||
| Austria |
– | 12,475 | – | 12,475 | ||||||||||||
| Belgium |
– | 23,256 | – | 23,256 | ||||||||||||
| Canada |
466,689 | – | – | 466,689 | ||||||||||||
| China |
– | 8,810 | – | 8,810 | ||||||||||||
| Denmark |
– | 184,871 | – | 184,871 | ||||||||||||
| Finland |
– | 48,114 | – | 48,114 | ||||||||||||
| France |
8,411 | 292,795 | – | 301,206 | ||||||||||||
| Germany |
– | 435,202 | – | 435,202 | ||||||||||||
| Hong Kong |
– | 71,702 | – | 71,702 | ||||||||||||
| Ireland |
– | 42,513 | – | 42,513 | ||||||||||||
| Italy |
– | 45,727 | – | 45,727 | ||||||||||||
| Japan |
– | 766,987 | – | 766,987 | ||||||||||||
| Netherlands |
– | 267,552 | – | 267,552 | ||||||||||||
| New Zealand |
– | 21,231 | – | 21,231 | ||||||||||||
| Norway |
– | 23,333 | – | 23,333 | ||||||||||||
| Portugal |
– | 4,255 | – | 4,255 | ||||||||||||
| Singapore |
– | 40,307 | – | 40,307 | ||||||||||||
| Spain |
– | 63,410 | – | 63,410 | ||||||||||||
| Sweden |
– | 81,691 | – | 81,691 | ||||||||||||
| Switzerland |
– | 316,583 | – | 316,583 | ||||||||||||
| United Kingdom |
130,056 | 355,763 | – | 485,819 | ||||||||||||
| United States |
6,609,499 | 21,562 | – | 6,631,061 | ||||||||||||
| Money Market Funds |
560,458 | – | – | 560,458 | ||||||||||||
| Total Investments in Securities |
7,775,113 | 3,324,060 | – | 11,099,173 | ||||||||||||
| Other Investments - Assets* |
||||||||||||||||
| Futures Contracts |
7,982 | – | – | 7,982 | ||||||||||||
| Total Investments |
$ | 7,783,095 | $ | 3,324,060 | $ | – | $ | 11,107,155 | ||||||||
| * | Unrealized appreciation. |
NOTE 4–Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2021:
| Value | ||||
| Equity | ||||
| Derivative Assets | Risk | |||
|
|
||||
| Unrealized appreciation on futures contracts – Exchange-Traded(a) |
$ | 7,982 | ||
| Derivatives not subject to master netting agreements |
(7,982 | ) | ||
| Total Derivative Assets subject to master netting agreements |
$ | – | ||
| (a) | The daily variation margin receivable (payable) at period-end is recorded in the Statement of Assets and Liabilities. |
| 17 | Invesco MSCI World SRI Index Fund |
Effect of Derivative Investments for the six months ended April 30, 2021
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
| Location of Gain on Statement of Operations |
||||
| Equity | ||||
| Risk | ||||
|
|
||||
| Realized Gain: |
||||
| Futures contracts |
$26,912 | |||
|
|
||||
| Change in Net Unrealized Appreciation: |
||||
| Futures contracts |
9,245 | |||
|
|
||||
| Total |
$36,157 | |||
|
|
||||
The table below summarizes the average notional value of derivatives held during the period.
| Futures Contracts |
||||
|
|
||||
| Average notional value |
$274,902 | |||
|
|
||||
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2020, as follows:
| Capital Loss Carryforward* | ||||||||||||
| Expiration |
Short-Term | Long-Term | Total | |||||||||
| Not subject to expiration |
$638,583 | $ | 245,867 | $ | 884,450 | |||||||
|
|
||||||||||||
| * | Capital loss carryforward 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
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $684,383 and $353,667, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis |
| |||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 2,739,700 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(54,127 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 2,685,573 | ||
|
|
||||
Cost of investments for tax purposes is $8,421,582.
| 18 | Invesco MSCI World SRI Index Fund |
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended | Year ended | |||||||||||||||
| April 30, 2021(a) | October 31, 2020 | |||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
3,416 | $ | 47,297 | 33,428 | $ | 398,098 | ||||||||||
|
|
||||||||||||||||
| Class C |
1,847 | 24,513 | 6,883 | 68,917 | ||||||||||||
|
|
||||||||||||||||
| Class R |
4,734 | 65,456 | 25,737 | 286,140 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
11,049 | 159,476 | 18,179 | 197,875 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
22 | 300 | 102 | 1,143 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
64,282 | 892,594 | 88,565 | 1,017,782 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
1,093 | 14,452 | 1,938 | 23,472 | ||||||||||||
|
|
||||||||||||||||
| Class C |
169 | 2,208 | 175 | 2,109 | ||||||||||||
|
|
||||||||||||||||
| Class R |
385 | 5,065 | 27 | 329 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
509 | 6,760 | 710 | 8,620 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
13 | 176 | 14 | 171 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
6,734 | 89,424 | 8,164 | 99,114 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
1,661 | 22,161 | 1,217 | 14,874 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(1,677 | ) | (22,161 | ) | (1,228 | ) | (14,874 | ) | ||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(2,640 | ) | (36,518 | ) | (83,400 | ) | (848,208 | ) | ||||||||
|
|
||||||||||||||||
| Class C |
(1,685 | ) | (22,261 | ) | (12,939 | ) | (134,219 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(10 | ) | (140 | ) | (1,076 | ) | (12,624 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(2,486 | ) | (33,455 | ) | (21,764 | ) | (261,115 | ) | ||||||||
|
|
||||||||||||||||
| Class R5 |
(5 | ) | (73 | ) | (10 | ) | (113 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(30,974 | ) | (427,094 | ) | (96,623 | ) | (1,135,594 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
56,437 | $ | 788,180 | (31,901 | ) | $ | (288,103 | ) | ||||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 64% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 13% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser.
| 19 | Invesco MSCI World SRI Index Fund |
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL expenses) |
|||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Expense Ratio | |||||||
|
Class A |
$1,000.00 | $1,264.30 | $2.47 | $1,022.61 | $2.21 | 0.44% | ||||||
|
Class C |
1,000.00 | 1,259.30 | 6.67 | 1,018.89 | 5.96 | 1.19 | ||||||
|
Class R |
1,000.00 | 1,262.20 | 3.87 | 1,021.37 | 3.46 | 0.69 | ||||||
| Class Y |
1,000.00 | 1,266.30 | 1.07 | 1,023.85 | 0.95 | 0.19 | ||||||
|
Class R5 |
1,000.00 | 1,266.30 | 1.07 | 1,023.85 | 0.95 | 0.19 | ||||||
|
Class R6 |
1,000.00 | 1,266.30 | 1.07 | 1,023.85 | 0.95 | 0.19 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
| 20 | Invesco MSCI World SRI Index Fund |
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| ∎ | Fund reports and prospectuses |
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| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
|
SEC file numbers: 811-06463 and 033-44611 Invesco Distributors, Inc. GLRE-SAR-1
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|
Semiannual Report to Shareholders | April 30, 2021 | ||
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| Invesco Oppenheimer International Growth Fund | ||||
|
Nasdaq: |
||||
| A: OIGAX ∎ C: OIGCX ∎ R: OIGNX ∎ Y: OIGYX ∎ R5: INGFX ∎ R6: OIGIX | ||||
| 2 | Fund Performance | |||||
| 4 | Liquidity Risk Management Program | |||||
| 5 | Schedule of Investments | |||||
| 8 | Financial Statements | |||||
| 11 | Financial Highlights | |||||
| 12 | Notes to Financial Statements | |||||
| 18 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
|
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
2 Invesco Oppenheimer International Growth Fund
3 Invesco Oppenheimer International Growth Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
| ∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
| ∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
| ∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
| ∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
| ∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Oppenheimer International Growth Fund
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Oppenheimer International Growth Fund
Investment Abbreviations:
ADR – American Depositary Receipt
CDI – CREST Depository Interest
Pfd. – Preferred
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, 2021. |
| (c) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $1,052,010,357, which represented 8.31% of the Fund’s Net Assets. |
| (d) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
| Value October 31, 2020 |
Purchases at Cost |
Proceeds from Sales |
Change in Unrealized Appreciation |
Realized Gain (Loss) |
Value April 30, 2021 |
Dividend Income | |||||||||||||||||||||||||||||
| Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
| Invesco Government & Agency Portfolio, Institutional Class |
$ | 65,131,259 | $ | 512,640,973 | $ | (503,496,692 | ) | $ | - | $ | - | $ | 74,275,540 | $ | 8,172 | ||||||||||||||||||||
| Invesco Liquid Assets Portfolio, Institutional Class |
46,513,152 | 366,172,124 | (359,633,822 | ) | 5,794 | (4,603 | ) | 53,052,645 | 11,680 | ||||||||||||||||||||||||||
| Invesco Treasury Portfolio, Institutional Class |
74,435,724 | 585,875,398 | (575,424,791 | ) | - | - | 84,886,331 | 3,992 | |||||||||||||||||||||||||||
| Investments Purchased with Cash Collateral from Securities on Loan: |
|
||||||||||||||||||||||||||||||||||
| Invesco Private Government Fund |
- | 76,572,394 | (21,632,522 | ) | - | - | 54,939,872 | 135 | * | ||||||||||||||||||||||||||
| Invesco Private Prime Fund |
- | 107,316,450 | (24,906,675 | ) | - | 34 | 82,409,809 | 2,008 | * | ||||||||||||||||||||||||||
| Total |
$ | 186,080,135 | $ | 1,648,577,339 | $ | (1,485,094,502 | ) | $ | 5,794 | $ | (4,569 | ) | $ | 349,564,197 | $ | 25,987 | |||||||||||||||||||
| * | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Oppenheimer International Growth Fund
| (e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
| (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 1I. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
| Information Technology |
22.55 | % | ||
| Consumer Discretionary |
22.22 | |||
| Industrials |
19.74 | |||
| Health Care |
10.79 | |||
| Consumer Staples |
7.86 | |||
| Communication Services |
5.74 | |||
| Materials |
3.07 | |||
| Financials |
2.22 | |||
| Energy |
2.07 | |||
| Real Estate |
0.52 | |||
| Money Market Funds Plus Other Assets Less Liabilities |
3.22 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Oppenheimer International Growth Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Oppenheimer International Growth Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
| Investment income: |
||||
| Dividends (net of foreign withholding taxes of $5,069,614) |
$ | 68,028,162 | ||
|
|
||||
| Dividends from affiliates (includes securities lending income of $4,759) |
28,603 | |||
|
|
||||
| Total investment income |
68,056,765 | |||
|
|
||||
| Expenses: |
||||
| Advisory fees |
40,855,130 | |||
|
|
||||
| Administrative services fees |
905,925 | |||
|
|
||||
| Custodian fees |
669,853 | |||
|
|
||||
| Distribution fees: |
||||
| Class A |
2,018,892 | |||
|
|
||||
| Class C |
915,961 | |||
|
|
||||
| Class R |
748,628 | |||
|
|
||||
| Transfer agent fees – A, C, R and Y |
4,946,945 | |||
|
|
||||
| Transfer agent fees – R6 |
36,650 | |||
|
|
||||
| Trustees’ and officers’ fees and benefits |
77,588 | |||
|
|
||||
| Registration and filing fees |
93,839 | |||
|
|
||||
| Reports to shareholders |
768,631 | |||
|
|
||||
| Professional services fees |
84,853 | |||
|
|
||||
| Other |
275,638 | |||
|
|
||||
| Total expenses |
52,398,533 | |||
|
|
||||
| Less: Fees waived, expenses reimbursed and/or expense offset arrangement(s) |
(240,057 | ) | ||
|
|
||||
| Net expenses |
52,158,476 | |||
|
|
||||
| Net investment income |
15,898,289 | |||
|
|
||||
| Realized and unrealized gain (loss) from: |
||||
| Net realized gain (loss) from: |
||||
| Unaffiliated investment securities |
1,440,564,554 | |||
|
|
||||
| Affiliated investment securities |
(4,569 | ) | ||
|
|
||||
| Foreign currencies |
(343,669 | ) | ||
|
|
||||
| 1,440,216,316 | ||||
|
|
||||
| Change in net unrealized appreciation of: |
||||
| Unaffiliated investment securities (net of foreign taxes of $793,528) |
1,206,313,146 | |||
|
|
||||
| Affiliated investment securities |
5,794 | |||
|
|
||||
| Foreign currencies |
571,310 | |||
|
|
||||
| 1,206,890,250 | ||||
|
|
||||
| Net realized and unrealized gain |
2,647,106,566 | |||
|
|
||||
| Net increase in net assets resulting from operations |
$ | 2,663,004,855 | ||
|
|
||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Oppenheimer International Growth Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
| April 30, 2021 |
October 31, 2020 |
|||||||
| Operations: |
||||||||
| Net investment income |
$ | 15,898,289 | $ | 28,786,139 | ||||
|
|
||||||||
| Net realized gain |
1,440,216,316 | 2,271,347,718 | ||||||
|
|
||||||||
| Change in net unrealized appreciation (depreciation) |
1,206,890,250 | (1,042,368,332 | ) | |||||
|
|
||||||||
| Net increase in net assets resulting from operations |
2,663,004,855 | 1,257,765,525 | ||||||
|
|
||||||||
| Distributions to shareholders from distributable earnings: |
||||||||
| Class A |
(216,288,538 | ) | (14,967,695 | ) | ||||
|
|
||||||||
| Class C |
(28,578,549 | ) | (389,252 | ) | ||||
|
|
||||||||
| Class R |
(40,236,466 | ) | (2,024,284 | ) | ||||
|
|
||||||||
| Class Y |
(629,263,155 | ) | (66,722,610 | ) | ||||
|
|
||||||||
| Class R5 |
(1,827 | ) | (136 | ) | ||||
|
|
||||||||
| Class R6 |
(802,185,808 | ) | (92,899,212 | ) | ||||
|
|
||||||||
| Total distributions from distributable earnings |
(1,716,554,343 | ) | (177,003,189 | ) | ||||
|
|
||||||||
| Share transactions–net: |
||||||||
| Class A |
94,341,597 | (416,354,710 | ) | |||||
|
|
||||||||
| Class C |
(30,543,942 | ) | (75,863,463 | ) | ||||
|
|
||||||||
| Class R |
24,934,085 | (75,420,935 | ) | |||||
|
|
||||||||
| Class Y |
423,360,553 | (2,263,086,692 | ) | |||||
|
|
||||||||
| Class R5 |
18,520 | – | ||||||
|
|
||||||||
| Class R6 |
(322,620,862 | ) | (2,408,915,153 | ) | ||||
|
|
||||||||
| Net increase (decrease) in net assets resulting from share transactions |
189,489,951 | (5,239,640,953 | ) | |||||
|
|
||||||||
| Net increase (decrease) in net assets |
1,135,940,463 | (4,158,878,617 | ) | |||||
|
|
||||||||
| Net assets: |
||||||||
| Beginning of period |
11,525,600,106 | 15,684,478,723 | ||||||
|
|
||||||||
| End of period |
$12,661,540,569 | $11,525,600,106 | ||||||
|
|
||||||||
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Oppenheimer International Growth Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| Net asset value, beginning of period |
Net investment income (loss)(a) |
Net gains (losses) on securities (both realized and unrealized) |
Total from investment operations |
Dividends from net investment income |
Distributions from net realized gains |
Total distributions |
Net asset value, end of period |
Total return(b) |
Net assets, end of period (000’s omitted) |
Ratio of expenses to average fee waivers |
Ratio of expenses to average net assets without fee waivers and/or expenses absorbed(c) |
Ratio of net investment income to average |
Portfolio turnover (d) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
$ | 45.87 | $ | (0.00 | ) | $ | 10.36 | $ | 10.36 | $ | — | $ | (6.95 | ) | $ | (6.95 | ) | $ | 49.28 | 23.68 | % | $ | 1,690,191 | 1.08 | %(e) | 1.08 | %(e) | 0.00 | %(e) | 11 | % | |||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
41.74 | (0.02 | ) | 4.53 | 4.51 | (0.38 | ) | — | (0.38 | ) | 45.87 | 10.84 | 1,472,093 | 1.10 | 1.13 | (0.06 | ) | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
37.08 | 0.33 | 4.71 | 5.04 | (0.38 | ) | — | (0.38 | ) | 41.74 | 13.75 | 1,746,483 | 1.10 | (f) | 1.10 | (f) | 0.93 | (f) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
43.71 | 0.34 | (6.71 | ) | (6.37 | ) | (0.26 | ) | — | (0.26 | ) | 37.08 | (14.66 | ) | 2,146,246 | 1.11 | 1.11 | 0.79 | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
34.34 | 0.35 | 9.38 | 9.73 | (0.36 | ) | — | (0.36 | ) | 43.71 | 28.61 | 3,249,744 | 1.13 | 1.13 | 0.89 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
37.14 | 0.38 | (2.87 | ) | (2.49 | ) | (0.31 | ) | — | (0.31 | ) | 34.34 | (6.73 | ) | 4,253,937 | 1.14 | 1.14 | 1.08 | 9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
36.45 | 0.31 | 0.68 | 0.99 | (0.30 | ) | — | (0.30 | ) | 37.14 | 2.76 | 5,394,512 | 1.14 | 1.14 | 0.85 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class C |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
43.30 | (0.17 | ) | 9.75 | 9.58 | — | (6.95 | ) | (6.95 | ) | 45.93 | 23.23 | 165,449 | 1.83 | (e) | 1.83 | (e) | (0.75 | )(e) | 11 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
39.42 | (0.33 | ) | 4.28 | 3.95 | (0.07 | ) | — | (0.07 | ) | 43.30 | 10.02 | 184,361 | 1.85 | 1.88 | (0.81 | ) | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
34.97 | 0.06 | 4.46 | 4.52 | (0.07 | ) | — | (0.07 | ) | 39.42 | 12.95 | 241,807 | 1.85 | (f) | 1.85 | (f) | 0.18 | (f) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
41.29 | 0.02 | (6.34 | ) | (6.32 | ) | — | — | — | 34.97 | (15.31 | ) | 345,228 | 1.86 | 1.86 | 0.04 | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
32.44 | 0.03 | 8.91 | 8.94 | (0.09 | ) | — | (0.09 | ) | 41.29 | 27.64 | 468,753 | 1.88 | 1.88 | 0.09 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
35.10 | 0.10 | (2.70 | ) | (2.60 | ) | (0.06 | ) | — | (0.06 | ) | 32.44 | (7.42 | ) | 453,990 | 1.89 | 1.89 | 0.30 | 9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
34.49 | 0.05 | 0.63 | 0.68 | (0.07 | ) | — | (0.07 | ) | 35.10 | 1.99 | 543,536 | 1.89 | 1.89 | 0.14 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
44.92 | (0.06 | ) | 10.13 | 10.07 | — | (6.95 | ) | (6.95 | ) | 48.04 | 23.52 | 308,988 | 1.33 | (e) | 1.33 | (e) | (0.25 | )(e) | 11 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
40.88 | (0.13 | ) | 4.44 | 4.31 | (0.27 | ) | — | (0.27 | ) | 44.92 | 10.58 | 263,106 | 1.35 | 1.38 | (0.31 | ) | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
36.32 | 0.24 | 4.61 | 4.85 | (0.29 | ) | — | (0.29 | ) | 40.88 | 13.47 | 313,081 | 1.35 | (f) | 1.35 | (f) | 0.68 | (f) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
42.86 | 0.23 | (6.58 | ) | (6.35 | ) | (0.19 | ) | — | (0.19 | ) | 36.32 | (14.88 | ) | 377,926 | 1.36 | 1.36 | 0.54 | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
33.70 | 0.21 | 9.25 | 9.46 | (0.30 | ) | — | (0.30 | ) | 42.86 | 28.31 | 486,089 | 1.38 | 1.38 | 0.55 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
36.44 | 0.27 | (2.79 | ) | (2.52 | ) | (0.22 | ) | — | (0.22 | ) | 33.70 | (6.96 | ) | 390,589 | 1.38 | 1.38 | 0.78 | 9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
35.80 | 0.23 | 0.65 | 0.88 | (0.24 | ) | — | (0.24 | ) | 36.44 | 2.50 | 400,622 | 1.39 | 1.39 | 0.64 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class Y |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
45.63 | 0.06 | 10.30 | 10.36 | (0.05 | ) | (6.95 | ) | (7.00 | ) | 48.99 | 23.70 | 4,896,630 | 0.83 | (e) | 0.83 | (e) | 0.25 | (e) | 11 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
41.51 | 0.08 | 4.52 | 4.60 | (0.48 | ) | — | (0.48 | ) | 45.63 | 11.13 | 4,132,110 | 0.85 | 0.88 | 0.19 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
36.92 | 0.42 | 4.67 | 5.09 | (0.50 | ) | — | (0.50 | ) | 41.51 | 14.01 | 5,993,234 | 0.85 | (f) | 0.85 | (f) | 1.18 | (f) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
43.55 | 0.44 | (6.69 | ) | (6.25 | ) | (0.38 | ) | — | (0.38 | ) | 36.92 | (14.47 | ) | 9,329,538 | 0.86 | 0.86 | 1.04 | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
34.23 | 0.41 | 9.37 | 9.78 | (0.46 | ) | — | (0.46 | ) | 43.55 | 28.96 | 12,543,811 | 0.88 | 0.88 | 1.04 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
37.01 | 0.47 | (2.85 | ) | (2.38 | ) | (0.40 | ) | — | (0.40 | ) | 34.23 | (6.49 | ) | 9,929,295 | 0.89 | 0.89 | 1.33 | 9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
36.36 | 0.42 | 0.64 | 1.06 | (0.41 | ) | — | (0.41 | ) | 37.01 | 2.99 | 10,782,234 | 0.89 | 0.89 | 1.13 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R5 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
45.97 | 0.09 | 10.39 | 10.48 | (0.14 | ) | (6.95 | ) | (7.09 | ) | 49.36 | 23.60 | 32 | 0.69 | (e) | 0.69 | (e) | 0.39 | (e) | 11 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
41.80 | 0.15 | 4.55 | 4.70 | (0.53 | ) | — | (0.53 | ) | 45.97 | 11.29 | 12 | 0.69 | 0.69 | 0.35 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Period ended 10/31/19(g) |
38.79 | 0.23 | 2.78 | 3.01 | — | — | — | 41.80 | 7.76 | 11 | 0.74 | (f) | 0.74 | (f) | 1.29 | (f) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class R6 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Six months ended 04/30/21 |
45.67 | 0.09 | 10.32 | 10.41 | (0.14 | ) | (6.95 | ) | (7.09 | ) | 48.99 | 23.93 | 5,600,251 | 0.69 | (e) | 0.69 | (e) | 0.39 | (e) | 11 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 10/31/20 |
41.55 | 0.15 | 4.52 | 4.67 | (0.55 | ) | — | (0.55 | ) | 45.67 | 11.29 | 5,473,919 | 0.69 | 0.69 | 0.35 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Eleven months ended 10/31/19 |
36.98 | 0.48 | 4.67 | 5.15 | (0.58 | ) | — | (0.58 | ) | 41.55 | 14.18 | 7,389,864 | 0.69 | (f) | 0.69 | (f) | 1.34 | (f) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/18 |
43.62 | 0.51 | (6.69 | ) | (6.18 | ) | (0.46 | ) | — | (0.46 | ) | 36.98 | (14.32 | ) | 8,682,910 | 0.69 | 0.69 | 1.20 | 18 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/17 |
34.31 | 0.45 | 9.40 | 9.85 | (0.54 | ) | — | (0.54 | ) | 43.62 | 29.14 | 10,542,873 | 0.69 | 0.69 | 1.15 | 22 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/16 |
37.09 | 0.49 | (2.81 | ) | (2.32 | ) | (0.46 | ) | — | (0.46 | ) | 34.31 | (6.31 | ) | 6,435,502 | 0.70 | 0.70 | 1.38 | 9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Year ended 11/30/15 |
36.43 | 0.48 | 0.65 | 1.13 | (0.47 | ) | — | (0.47 | ) | 37.09 | 3.19 | 4,381,328 | 0.70 | 0.70 | 1.31 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (a) | Calculated using average shares outstanding. |
| (b) | 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. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Does not include estimated acquired fund fees from underlying funds of 0.00% for the eleven months ended October 31, 2019 and the years ended November 30, 2018, 2017, 2016 and 2015, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $1,657,921, $184,710, $301,933, $4,742,890, $20 and $5,817,174 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
| (f) | Annualized. |
| (g) | Commencement date after the close of business on May 24, 2019. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Oppenheimer International Growth Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Oppenheimer International Growth Fund (the “Fund”) is a series portfolio of AIM International Mutual Funds (Invesco International Mutual Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. Security Valuations – Securities, including restricted securities, are valued according to the following policy.
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 asked 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 asked prices. For purposes of determining net asset value (“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 net asset value 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. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. 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 NYSE. 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 the investment 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 by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked 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.
The 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 Fund 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 market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally 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. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 Invesco Oppenheimer International Growth Fund
| settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
| C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. |
Therefore, no provision for federal income taxes is recorded in the financial statements.
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the 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.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
| G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors 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. |
| H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy 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. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the 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. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. 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. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The 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 Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
| J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 Invesco Oppenheimer International Growth Fund
| foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| K. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
| L. | Other Risks – Emerging markets (also referred to as developing markets) are generally subject to greater market volatility, political, social and economic instability, uncertainty regarding the existence of trading markets and more governmental limitations on foreign investment than more developed markets. In addition, companies operating in emerging markets may be subject to lower trading volume and greater price fluctuations than companies in more developed markets. Securities law in many emerging market countries is relatively new and unsettled. Therefore, laws regarding foreign investment in emerging market securities, securities regulation, title to securities, and shareholder rights may change quickly and unpredictably. In addition, the enforcement of systems of taxation at federal, regional and local levels in emerging market countries may be inconsistent, and subject to sudden change. Other risks of investing in emerging markets securities may include additional transaction costs, delays in settlement procedures, and lack of timely information. |
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
| Average Daily Net Assets* | Rate | |||
| First $ 250 million |
0.800 | % | ||
| Next $250 million |
0.770 | % | ||
| Next $500 million |
0.750 | % | ||
| Next $1 billion |
0.690 | % | ||
| Next $3 billion |
0.670 | % | ||
| Next $5 billion |
0.650 | % | ||
| Next $10 billion |
0.630 | % | ||
| Next $10 billion |
0.610 | % | ||
| Over $30 billion |
0.590 | % | ||
| * | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.65%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through May 31, 2021, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.10%, 1.85%, 1.35%, 0.85%, 0.74% and 0.69%, respectively, of the Fund’s average daily net assets (the “expense limits”). Effective June 1, 2021 through at least June 30, 2022, the Adviser has contractually agreed to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual operating expenses after fee waivers and/or expense reimbursements of Invesco Cash Reserve, Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.25% 3.00%, 2.50%, 2.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limit, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $200,004 and reimbursed class level expenses of $0, $0, $0, $0, $0 and $36,650 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
14 Invesco Oppenheimer International Growth Fund
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $60,590 in front-end sales commissions from the sale of Class A shares and $1,809 and $2,303 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3– 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. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. 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.
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Investments in Securities |
||||||||||||||||
| Australia |
$ | – | $ | 153,024,291 | $– | $ | 153,024,291 | |||||||||
| Belgium |
39,921,267 | – | – | 39,921,267 | ||||||||||||
| Canada |
556,886,268 | – | – | 556,886,268 | ||||||||||||
| China |
187,657,730 | 254,586,242 | – | 442,243,972 | ||||||||||||
| Denmark |
68,889,889 | 216,288,353 | – | 285,178,242 | ||||||||||||
| France |
– | 2,185,763,678 | – | 2,185,763,678 | ||||||||||||
| Germany |
– | 703,213,374 | – | 703,213,374 | ||||||||||||
| Hong Kong |
– | 84,651,361 | – | 84,651,361 | ||||||||||||
| India |
446,195 | 346,824,600 | – | 347,270,795 | ||||||||||||
| Ireland |
– | 227,168,837 | – | 227,168,837 | ||||||||||||
| Italy |
– | 145,519,910 | – | 145,519,910 | ||||||||||||
| Japan |
– | 962,435,986 | – | 962,435,986 | ||||||||||||
| Netherlands |
– | 861,996,195 | – | 861,996,195 | ||||||||||||
| New Zealand |
– | 152,695,778 | – | 152,695,778 | ||||||||||||
| Spain |
– | 180,347,355 | – | 180,347,355 | ||||||||||||
| Sweden |
– | 807,752,893 | – | 807,752,893 | ||||||||||||
| Switzerland |
– | 804,130,694 | – | 804,130,694 | ||||||||||||
| Taiwan |
– | 333,758,412 | – | 333,758,412 | ||||||||||||
| United Kingdom |
– | 1,996,802,913 | – | 1,996,802,913 | ||||||||||||
| United States |
636,987,881 | 346,071,507 | – | 983,059,388 | ||||||||||||
| Money Market Funds |
212,214,516 | 137,349,681 | – | 349,564,197 | ||||||||||||
| Total Investments |
$ | 1,703,003,746 | $ | 10,900,382,060 | $– | $ | 12,603,385,806 | |||||||||
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $3,403.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred
15 Invesco Oppenheimer International Growth Fund
compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
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 Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $1,318,232,429 and $2,951,427,393, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
|
|
||||
| Aggregate unrealized appreciation of investments |
$ | 5,986,310,516 | ||
|
|
||||
| Aggregate unrealized (depreciation) of investments |
(133,177,589 | ) | ||
|
|
||||
| Net unrealized appreciation of investments |
$ | 5,853,132,927 | ||
|
|
||||
Cost of investments for tax purposes is $6,750,252,879.
NOTE 9–Share Information
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Sold: |
||||||||||||||||
| Class A |
2,373,360 | $ | 115,115,212 | 4,929,736 | $ | 208,440,031 | ||||||||||
|
|
||||||||||||||||
| Class C |
145,016 | 6,562,089 | 253,152 | 10,099,321 | ||||||||||||
|
|
||||||||||||||||
| Class R |
454,022 | 21,483,079 | 770,790 | 31,990,751 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
10,792,506 | 518,697,253 | 24,120,356 | 985,899,217 | ||||||||||||
|
|
||||||||||||||||
| Class R5 |
385 | 18,520 | - | - | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
8,178,711 | 392,575,655 | 20,059,354 | 800,379,878 | ||||||||||||
|
|
||||||||||||||||
| Issued as reinvestment of dividends: |
||||||||||||||||
| Class A |
4,214,602 | 193,703,125 | 308,046 | 13,550,936 | ||||||||||||
|
|
||||||||||||||||
| Class C |
614,969 | 26,419,071 | 8,380 | 350,394 | ||||||||||||
|
|
||||||||||||||||
| Class R |
896,402 | 40,194,683 | 46,843 | 2,022,225 | ||||||||||||
|
|
||||||||||||||||
| Class Y |
10,643,741 | 485,886,766 | 1,056,005 | 46,105,173 | ||||||||||||
|
|
||||||||||||||||
| Class R6 |
15,502,468 | 707,222,576 | 1,861,159 | 81,220,968 | ||||||||||||
|
|
||||||||||||||||
| Automatic conversion of Class C shares to Class A shares: |
||||||||||||||||
| Class A |
841,481 | 40,013,051 | 539,885 | 24,031,600 | ||||||||||||
|
|
||||||||||||||||
| Class C |
(900,763 | ) | (40,013,051 | ) | (570,354 | ) | (24,031,600 | ) | ||||||||
|
|
||||||||||||||||
16 Invesco Oppenheimer International Growth Fund
| Summary of Share Activity | ||||||||||||||||
|
|
||||||||||||||||
| Six months ended April 30, 2021(a) |
Year ended October 31, 2020 |
|||||||||||||||
| Shares | Amount | Shares | Amount | |||||||||||||
|
|
||||||||||||||||
| Reacquired: |
||||||||||||||||
| Class A |
(5,225,795 | ) | $ | (254,489,791 | ) | (15,530,731 | ) | $ | (662,377,277 | ) | ||||||
|
|
||||||||||||||||
| Class C |
(514,414 | ) | (23,512,051 | ) | (1,567,297 | ) | (62,281,578 | ) | ||||||||
|
|
||||||||||||||||
| Class R |
(776,060 | ) | (36,743,677 | ) | (2,618,221 | ) | (109,433,911 | ) | ||||||||
|
|
||||||||||||||||
| Class Y |
(12,050,072 | ) | (581,223,466 | ) | (78,997,222 | ) | (3,295,091,082 | ) | ||||||||
|
|
||||||||||||||||
| Class R6 |
(29,212,815 | ) | (1,422,419,093 | ) | (79,925,626 | ) | (3,290,515,999 | ) | ||||||||
|
|
||||||||||||||||
| Net increase (decrease) in share activity |
5,977,744 | $ | 189,489,951 | (125,255,745 | ) | $ | (5,239,640,953 | ) | ||||||||
|
|
||||||||||||||||
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 47% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 7% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser.
17 Invesco Oppenheimer International Growth Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, 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 table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed 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 Fund 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 transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information 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 transaction costs were included, your costs would have been higher.
| ACTUAL |
HYPOTHETICAL (5% annual return before expenses) |
|||||||||||
| Beginning Account Value (11/01/20) |
Ending Account Value (04/30/21)1 |
Expenses Paid During Period2 |
Ending Account Value (04/30/21) |
Expenses Paid During Period2 |
Annualized Expense Ratio | |||||||
|
Class A |
$1,000.00 | $1,236.80 | $5.99 | $1,019.44 | $5.41 | 1.08% | ||||||
|
Class C |
1,000.00 | 1,232.30 | 10.13 | 1,015.72 | 9.15 | 1.83 | ||||||
|
Class R |
1,000.00 | 1,235.20 | 7.37 | 1,018.20 | 6.66 | 1.33 | ||||||
|
Class Y |
1,000.00 | 1,237.00 | 4.60 | 1,020.68 | 4.16 | 0.83 | ||||||
|
Class R5 |
1,000.00 | 1,236.00 | 3.83 | 1,021.37 | 3.46 | 0.69 | ||||||
|
Class R6 |
1,000.00 | 1,239.30 | 3.83 | 1,021.37 | 3.46 | 0.69 | ||||||
| 1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
18 Invesco Oppenheimer International Growth Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
| ∎ | Fund reports and prospectuses |
| ∎ | Quarterly statements |
| ∎ | Daily confirmations |
| ∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
| Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
|
| SEC file numbers: 811-06463 and 033-44611 | Invesco Distributors, Inc. | O-IGR-SAR-1 |
| ITEM 2. | CODE OF ETHICS. |
Not applicable for a semi-annual report.
| ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. |
Not applicable.
| ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
Not applicable.
| ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. |
Not applicable.
| ITEM 6. | SCHEDULE OF INVESTMENTS. |
Investments in securities of unaffiliated issuers is included as part of the reports to stockholders filed under Item 1 of this Form.
| 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 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. |
None
| ITEM 11. | CONTROLS AND PROCEDURES. |
| (a) | As of June 18, 2021, an evaluation was performed under the supervision and with the participation of the officers of the Registrant, including the PEO and PFO, to assess the effectiveness of the Registrant’s disclosure controls and procedures, as that term is defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”), as amended. Based on that evaluation, the Registrant’s officers, including the PEO and PFO, concluded that, as of June 18, 2021, the Registrant’s disclosure controls and procedures were reasonably designed to ensure: (1) that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission; and (2) that material information relating to the Registrant is made known to the PEO and PFO as appropriate to allow timely decisions regarding required disclosure. |
| (b) | There have been no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during 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. | DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 13. | EXHIBITS. |
| 13(a) (1) | Not applicable. |
| 13(a) (2) |
| 13(a) (3) | Not applicable. |
| 13(a) (4) | Not applicable. |
| 13(b) |
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: AIM International Mutual Funds (Invesco International Mutual Funds)
| By: | /s/ Sheri Morris | |
| Sheri Morris | ||
| Principal Executive Officer | ||
| Date: | July 8, 2021 | |
Pursuant to the requirements of the Securities and 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/ Sheri Morris | |
| Sheri Morris | ||
| Principal Executive Officer | ||
| Date: | July 8, 2021 | |
| By: | /s/ Adrien Deberghes | |
| Adrien Deberghes | ||
| Principal Financial Officer | ||
| Date: | July 8, 2021 | |