AIIEX
Invesco EQV International Equity-A
Exploring AIIEX’s Growth Potential
The Invesco EQV International Equity-A (AIIEX) fund is designed to provide long-term capital growth by investing in a diversified portfolio of international equity securities. The fund’s investment advisor focuses on issuers with strong earnings momentum, aiming to capture growth opportunities in foreign markets. As a Foreign-Large Growth fund, AIIEX is positioned to benefit from the dynamic and evolving global economy, offering investors exposure to a wide range of industries and regions. This fund is particularly appealing to those seeking to diversify their portfolios beyond domestic markets and capitalize on international growth trends.
At A Glance
Executive Summary
AIIEX offers international growth with a focus on strong earnings momentum, featuring a diversified portfolio and competitive returns.
Exposure to international growth markets Focus on companies with strong earnings momentum Diversified sector allocation
Higher expense ratio compared to peers Negative alpha indicating underperformance Potential volatility with high beta
Performance Analysis: A Mixed Bag
AIIEX has shown varied performance over different time frames. Over the past year, the fund delivered a return of 12.17%, which, while respectable, falls short of its benchmark, the MSCI ACWI xUS DivAdj Idx, which returned 17.25%. The fund’s five-year annualized return stands at 3.89%, and since inception, it has achieved a 6.86% return. These figures suggest that while the fund has potential, it has struggled to consistently outperform its benchmark. Investors should consider these performance metrics in the context of their own risk tolerance and investment goals.
Sector Allocation: A Strategic Mix
AIIEX’s sector allocation is strategically diversified, with significant investments in Industrials (22.88%), Technology (18.77%), and Financials (15.19%). This mix reflects the fund’s focus on sectors with strong growth potential and earnings momentum. The absence of investments in Utilities and Real Estate indicates a deliberate strategy to avoid sectors with potentially lower growth prospects. The fund’s allocation to Health Care (12.92%) and Cyclical sectors (10.06%) further underscores its commitment to capturing growth opportunities across various industries. This diversified sector approach is designed to mitigate risk while maximizing growth potential.
Risk Metrics: Understanding the Volatility
AIIEX exhibits a higher level of risk, as indicated by its beta of 1.08, suggesting that the fund is more volatile than the market. The negative alpha of -5.10% indicates that the fund has underperformed its benchmark on a risk-adjusted basis. The Sharpe Ratio of -0.38 and Treynor Ratio of -4.70 further highlight the fund’s challenges in delivering risk-adjusted returns. However, the fund’s standard deviation of 3.87% and downside risk of 2.80% provide a measure of the volatility investors might expect. These metrics are crucial for investors to consider, especially those with a lower risk tolerance.
Comparative Analysis: AIIEX vs. Peers
When compared to similar funds, AIIEX presents a mixed picture. For instance, BNY Mellon Worldwide Growth-A (PGROX) achieved a higher 1-year return of 17.73% with a lower expense ratio of 0.0113. Similarly, Putnam International Equity-A (POVSX) and Federated Hermes Int’l Equity-A (PMIEX) also outperformed AIIEX in terms of 1-year returns. However, AIIEX’s focus on strong earnings momentum and its diversified international exposure remain attractive features. Investors should weigh these factors against the fund’s higher expense ratio and recent performance challenges when considering AIIEX as part of their portfolio.
Top Holdings: A Glimpse into AIIEX’s Portfolio
AIIEX’s top holdings provide insight into its investment strategy. The fund’s largest positions include Investor AB Class B (3.37%), Taiwan Semiconductor Manufacturing Co Ltd (3.11%), and RELX PLC (2.69%). These companies are leaders in their respective industries, reflecting the fund’s focus on firms with strong earnings momentum. The presence of technology giants like Broadcom Inc and healthcare leaders like Novo Nordisk AS further highlights the fund’s commitment to growth sectors. This selection of top holdings underscores AIIEX’s strategy of investing in high-potential companies across diverse international markets.
Market Cap Allocation: Targeting Large and Extra-Large Companies
AIIEX’s market cap allocation is heavily weighted towards large (39.38%) and extra-large (44.88%) companies. This focus on larger market cap companies suggests a strategy aimed at stability and established growth potential. By investing in well-established firms, the fund seeks to balance the inherent risks of international markets with the reliability of larger, more stable companies. This approach may appeal to investors looking for growth opportunities without the heightened volatility often associated with smaller-cap stocks. The fund’s minimal exposure to small and medium-cap companies further emphasizes its conservative growth strategy.
Conclusion: Is AIIEX Right for You?
In conclusion, the Invesco EQV International Equity-A fund offers a compelling option for investors seeking international growth opportunities. Its focus on companies with strong earnings momentum and a diversified sector allocation make it a suitable choice for those looking to diversify their portfolios beyond domestic markets. However, potential investors should be mindful of the fund’s higher expense ratio and recent underperformance relative to its benchmark. AIIEX is best suited for growth-oriented investors with a higher risk tolerance who are comfortable with the fund’s volatility and are seeking exposure to international markets.
Similar Securities
OIDAX: Invesco International Diversified-A | Global Growth Fund
OIDAX offers diversified international exposure with a focus on growth, featuring a high allocation to non-U.S. equities and a competitive yield.
LMGTX: ClearBridge International Growth-C | Foreign-Large Growth Fund Analysis
LMGTX offers robust foreign equity exposure with a focus on growth, featuring a high expense ratio but strong 1-year returns.
AIIEX: Invesco EQV International Equity-A | International Growth Opportunities
AIIEX offers international growth with a focus on strong earnings momentum, featuring a diversified portfolio and competitive returns.
FNGAX: Franklin International Growth-A | Foreign-Large Growth Fund Analysis
FNGAX offers exposure to non-U.S. mid-large cap equities with a focus on growth, boasting a 1-year return of 20.63% and a diverse sector allocation.
PRITX: TRPrice International Stock-Inv | Global Growth Opportunities
PRITX offers exposure to established non-US stocks with a focus on growth, featuring a competitive expense ratio of 0.83%.
Futher Reading
https://finance.yahoo.com/quote/AIIEX/”>Yahoo: Invesco EQV International Equity-A
https://ftcloud.fasttrack.net/web/chart/AIIEX
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