Wealth & Finance International - January 2017

Wealth & Finance International 52 Excellence in ETFs owerShares by Invesco is a global provider of ex- change-traded funds (ETFs) that bridge the gap between active and passive investing by combining the best of both investing philosophies. The firm is the fourth largest ETF provider by assets, with a line-up of more than 140 domes- tic and international PowerShares ETFs. Its ETF offerings seek to outperform traditional benchmark indexes while providing advisors and investors access to an innovative array of focused investment opportunities. PowerShares is a pioneer in the realm of factor investing and smart beta strategies and has US franchise assets exceeding $110 billion as of December 30, 2016. Dan discusses the firm’s offerings. PowerShares works hard to ensure that it offers the broadest possible range of products that meet the needs of its myriad investors. “From our earliest beginnings, PowerShares has challenged convention- al investment thinking by pioneering the world of factor-based, alterna- tively weighted ETFs, which later became known as ‘smart beta.’ Smart beta ETFs are beneficially-disruptive technology that blend the positive characteristics of active and passive management while improving the toolbox of options available to investors. “Each of our ETFs is designed to apply a rules-based approach to investing, and most of them also provide investors with exposure to per- formance-based risk factors. In contrast to the traditional approach to portfolio construction based on market cap weighting and diversification by asset classes and sectors, factor investing builds portfolios based on the objective characteristics, or factors, that help to explain risk and return. The five most commonly accepted factors are low volatility, mo- mentum, quality, value and size. Overall, we have the broadest lineup of smart beta ETFs in the industry, including an expanding suite of single and multi-factor strategies that combine two factors to achieve specific objectives.” In order to continually improve upon its service offering and ensure that clients receive the very best investment opportunities possible, Power- Shares has recently invested in research, client services and education tools, which has helped the company to better engage with clients who are looking to understand their own demands and the correlation among different factors when combining these single- and multi-factor strategies together in a portfolio. As Global Head of PowerShares, Dan oversees the strategic direction of Invesco’s ETF business, including the products it offers, how the firm positions itself in a competitive marketplace, and, ultimately, how the firm achieves success. One of the central factors in this, according to Dan, is PowerShares’ staff, who bring a vast array of knowledge and expertise to the firm and allow it to provide the very highest standards of service and products to its clients. “Fundamentally, our greatest asset is our people and the intellectual capital they bring to bear in their jobs every day. This ranges from the portfolio managers who ensure that we deliver strong performance within each ETF’s stated goals, to the strategists who analyse and understand the inner workings of market conditions and how our products behave; our sales professionals who work tirelessly on the road supporting customer needs, and the research and product development teams that drive innovation. PowerShares is built on the knowledge and experience of our staff.” PowerShares enjoyed a very strong 2016 across its key objectives, and the strong performance of its ETFs, in terms of index tracking and adherence to each strategy’s mandate, helped the firm to gather clients’ support and provide great momentum heading into 2017. Dan con- cludes by outlining how the firm will take advantage of the opportunities it is presented with over the upcoming 12 months. “Looking ahead, PowerShares is squarely in the middle of the ongoing opportunities that exist by combining active and passive investing. Spe- cifically, in ETFs, there continues to be a number of new issuers in the marketplace who, collectively, launched 250 new ETFs in 2016, which followed the 284 that launched in 2015. Investors have a dizzying array of choices, and we must continually prove our value. “In terms of opportunities, I believe factor investing will continue to be a growth driver for us. A survey we conducted found that 71 percent of institutional investors, consultants and private banks expect to increase their allocations to factor-based strategies over the next five years. Looking at asset classes, fixed income is one area that is ripe for growth. ETFs currently make up three percent of the equities market but just half of one percent of the fixed income market. Closing that gap, and achieving comparable penetration in fixed income, represents an enor- mous opportunity, and at Powershare’s we are looking forward to taking advantage of this going forward.” Company: PowerShares by Invesco Name: Dan Draper, Global Head of PowerShares by Invesco Web Address: www.invescopowershares.com Address: 3500 Lacey Road, Suite 700, Downers Grove, IL Telephone: (800) 983-0903 (US) Outside US: +1 (713) 626-1919 PowerShares by Invesco is leading the Intelligent ETF Revolution through its family of more than 140 domestic and international exchange-traded funds. We invited the firm’s Global Head, Dan Draper, to tell us more. P 1701WF51