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

811-05686

AIM Investment Securities Funds (Invesco Investment Securities 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:

 

02/29

 

 

 

 

Date of reporting period:

 

02/29/2020

 

 

 

 

Item 1. Report to Stockholders.

Annual Report to Shareholders

February 29, 2020

Invesco Corporate Bond Fund

Nasdaq:

A: ACCBX ￿ C: ACCEX ￿ R: ACCZX ￿ Y: ACCHX ￿ R5: ACCWX ￿ R6: ICBFX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's web- site, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call (800) 959-4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

4 Performance Summary

6 Long-Term Fund Performance

8 Supplemental Information

9 Schedule of Investments

25 Financial Statements

28 Financial Highlights

29 Notes to Financial Statements

38Report of Independent Registered Public Accounting Firm

39Fund Expenses

40Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco Corporate Bond Fund

Bruce Crockett

Dear Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco Corporate Bond Fund

Management's Discussion of Fund Performance

Performance summary

For the fiscal year ended February 29, 2020, Class A shares of Invesco Corporate Bond Fund (the Fund), at net asset value (NAV), underperformed the Fund's broad market/style-specific benchmark, the Bloomberg Barclays U.S. Credit Index.

Your Fund's long-term performance appears later in this report.

Fund vs. Indexes

Total returns, 2/28/19 to 2/29/20, 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

15.20%

Class C Shares

14.43

Class R Shares

15.06

Class Y Shares

15.62

Class R5 Shares

15.55

Class R6 Shares

15.62

Bloomberg Barclays U.S. Credit Index￿ (Broad Market/Style-Specific Index)

15.30

Lipper BBB Rated Funds Index￿ (Peer Group Index)

15.57

Source(s): ￿RIMES Technologies Corp.; ￿Lipper Inc.

fiscal year, duration of the portfolio was main- tained in line with the broad market/style- specific benchmark, on average, and the tim- ing of changes and the degree of variance from the Fund's broad market/style-specific benchmark had a small negative effect on relative returns. Buying and selling US Trea- sury futures was an important tool used for the management of interest rate risk and to maintain our targeted portfolio duration dur- ing the fiscal year.

Part of the Fund's strategy in seeking to manage credit and currency risk during the fiscal year entailed purchasing and selling credit and currency derivatives. We sought to manage credit risk by purchasing and selling credit default swaps at various points throughout the fiscal year. Management of currency risk was carried out via currency forwards and options on as-needed basis and we believe it was effective in managing the currency positioning within the Fund during the fiscal year.

Market conditions and your Fund

During the fiscal year, US Treasury yields fell considerably, especially in February 2020, as concerns regarding the spread of the Corona- virus (COVID-19) took hold. The US credit market performed strongly over the fiscal year, with total returns above 15%, as mea- sured by the Bloomberg Barclays U.S. Credit Index. Credit spreads tightened for most of the fiscal year, but with worries stemming from the coronavirus, credit spreads widened in the last two months. With spreads roughly unchanged over the past 12 months, the pri- mary driver of returns was the decline in US Treasury yields. In particular, the 10-year US Treasury yield fell from 2.73% at the begin- ning of the fiscal year to 1.13% as of Febru- ary 29, 2020.1

During the fiscal year, the US Federal Re- serve (the Fed) cut interest rates three times: in July, September and October 2019 for a total decrease of 75 basis points.2 (A basis point is one one-hundredth of a percent- age point.) As a result, the federal funds tar- get rate stood at a range of 1.50% to 1.75%, on October 31, 2019, as well as at the end of the fiscal year.2 In addition to the decline in interest rates, US Treasury yields fell across all maturities. US investment grade credit returns were positive each month during the fiscal year, except for September. The out-of-

Portfolio Composition

By security type

% of total net assets

U.S. Dollar Denominated Bonds &

Notes

87.51%

U.S. Treasury Securities

4.84

Preferred Stocks

1.63

Asset-Backed Securities

1.28

Security Types Each Less Than

1% of Portfolio

1.36

Money Market Funds Plus Other

Assets Less Liabilities

3.38

index US high yield sector posted a positive return for the fiscal year, as did emerging markets credit.

The Fund, at NAV, posted a positive return for the fiscal year, but underperformed its broad market/style-specific benchmark, the Bloomberg Barclays U.S. Credit Index. Secu- rity selection in investment grade corporate bonds was the most notable contributor to the Fund's relative performance. Security selection in the financials and industrials sec- tors contributed significantly to the Fund's relative performance, as did an out-of-index exposure to the high yield sector.

The Fund's shorter duration relative to the broad market/style-specific benchmark damp- ened its performance, as interest rates fell meaningfully during the fiscal year. Addition- ally, an underweight allocation to the non- corporate credit sector, particularly local au- thority issuers, was a minor detractor from the Fund's relative performance, as the sec- tor performed well during the fiscal year.

The Fund may use active duration and yield curve positioning for risk management and for generating excess return versus its broad market/style-specific benchmark. Duration measures a portfolio's price sensitivity to in- terest rate changes. Yield curve positioning refers to actively emphasizing particular points (maturities) along the yield curve with favorable risk-return expectations. During the

Top Five Debt Issuers*

% of total net assets

1. U.S. Treasury

4.84%

2. Enterprise Products

 

Operating LLC

2.47

3. AbbVie, Inc.

1.92

4. AT&T, Inc.

1.69

5. Sprint Spectrum Co. LLC/Sprint

 

Spectrum Co. II LLC/Sprint

 

Spectrum Co. III LLC

1.52

We wish to remind you that the Fund is subject to interest rate risk, meaning when interest rates rise, the value of fixed income securities tends to fall. The risk may be greater in the current market enviroment be- cause interest rates are near historic lows. The degree to which the value of fixed income securities may decline due to rising interest rates may vary depending on the speed and magnitude of the increase in interest rates, as well as individual security characteristics, such as price, maturity, duration and coupon and market forces, such as supply and de- mand for similar securities. We are monitor- ing interest rates, and the market, economic and geopolitical factors that may impact the direction, speed and magnitude of changes to interest rates across the maturity spectrum, including the potential impact of monetary policy changes by the Fed and certain foreign central banks. If interest rates rise or fall faster than expected, markets may experience increased volatility, which may affect the value and/or liquidity of certain of the Fund's investments.

Thank you for investing in Invesco Corpo- rate Bond Fund and for sharing our long-term investment horizon.

1Source: US Department of the Treasury

2 Source: US Federal Reserve

The Fund's holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.

*Excluding money market fund holdings, if any.

Data presented here are as of February 29, 2020.

4Invesco Corporate Bond Fund

Portfolio Managers:

Matthew Brill

Chuck Burge

Michael Hyman

Scott Roberts

Todd Schomberg

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

5Invesco Corporate Bond Fund

Your Fund's Long-Term Performance

Results of a $10,000 Investment — Oldest Share Class(es)

Fund and index data from 2/28/10

$20,000

$17,638 Lipper BBB Rated Funds Index1

$17,081 Bloomberg Barclays U.S. Credit Index2

$17,004 Invesco Corporate Bond Fund — Class A Shares

15,000

10,000

5,000

2/28/10

2/11

2/12

2/13

2/14

2/15

2/16

2/17

2/18

2/19

2/20

1 Source: Lipper Inc.

2 Source: RIMES Technologies Corp.

Past performance cannot guarantee future results.

The data shown in the chart include rein- vested distributions, applicable sales charges and Fund expenses including management

fees. Index results include reinvested divi- dends, but they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses and management fees; performance of a market index does not. Per-

formance shown in the chart and table(s) does not reflect deduction of taxes a share- holder would pay on Fund distributions or sale of Fund shares.

6Invesco Corporate Bond Fund

Average Annual Total Returns

As of 2/29/20, including maximum applicable sales charges

Class A Shares

Inception (9/23/71)

7.06%

10 Years

5.45

5

Years

4.14

1

Year

10.33

Class C Shares

 

Inception (8/30/93)

5.33%

10 Years

5.18

5

Years

4.31

1

Year

13.43

Class R Shares

 

10 Years

5.66%

5

Years

4.80

1

Year

15.06

Class Y Shares

 

Inception (8/12/05)

5.83%

10 Years

6.20

5

Years

5.31

1

Year

15.62

Class R5 Shares

 

10 Years

6.31%

5

Years

5.41

1

Year

15.55

Class R6 Shares

 

10 Years

6.26%

5

Years

5.50

1

Year

15.62

Effective June 1, 2010, Class A, Class C and Class I shares of the predecessor fund, Van Kampen Corporate Bond Fund, advised by Van Kampen Asset Management were reorganized into Class A, Class C and Class Y shares, respectively, of Invesco Van Kampen Corporate Bond Fund (re- named Invesco Corporate Bond Fund). Re- turns shown above, prior to June 1, 2010, for Class A, Class C and Class Y shares are blended returns of the predecessor fund and Invesco Corporate Bond Fund. Share class returns will differ from the predeces- sor fund because of different expenses.

Class R shares incepted on June 6, 2011. Performance shown prior to that date is that of the Fund's and the predecessor fund's Class A shares, restated to reflect the higher 12b-1 fees applicable to Class R shares.

Class R5 shares incepted on June 1, 2010. Performance shown prior to that date is that of the predecessor fund's Class A shares and includes the 12b-1 fees applicable to Class A shares.

Class R6 shares incepted on Septem-

ber 24, 2012. Performance shown prior to that date is that of the Fund's and the pre- decessor fund's Class A shares and in- cludes the 12b-1 fees applicable to Class A shares.

The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month- end performance. Performance figures re- flect reinvested distributions, changes in net asset value and the effect of the maxi- mum sales charge unless otherwise stated. Performance figures do not reflect deduc- tion of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.

Class A share performance reflects the maximum 4.25% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, perfor- mance is at net asset value.

The performance of the Fund's share classes will differ primarily due to different sales charge structures and class expenses. Fund performance reflects any applicable

fee waivers and/or expense reimburse- ments. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more informa- tion.

7Invesco Corporate Bond Fund

Invesco Corporate Bond Fund's investment objective is to seek to provide current income with preservation of capital. Capital appreciation is a secondary objective that is sought only when consistent with the Fund's primary investment objective.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

About indexes used in this report

￿The Bloomberg Barclays U.S. Credit Index is an unmanaged index considered representative of publicly issued, SEC- registered US corporate and specified for- eign debentures and secured notes.

￿The Lipper BBB Rated Funds Index is an unmanaged index considered representa- tive of BBB-rated funds tracked by Lipper.

￿The Fund is not managed to track the per- formance of any particular index, including the index(es) described here, and conse- quently, 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. Perfor- mance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.

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

8Invesco Corporate Bond Fund

Schedule of Investments(a)

February 29, 2020

Principal

AmountValue

U.S. Dollar Denominated Bonds & Notes–87.51%

Advertising–0.23%

 

 

 

Lamar Media Corp.,

 

 

 

3.75%, 02/15/2028(b)

$ 3,842,000

$

3,862,363

4.00%, 02/15/2030(b)

1,302,000

 

1,305,255

 

 

 

5,167,618

Aerospace & Defense–0.63%

 

 

 

Boeing Co. (The),

 

 

 

2.95%, 02/01/2030

7,000,000

 

7,351,189

3.95%, 08/01/2059

5,000,000

 

5,483,503

Moog, Inc., 4.25%, 12/15/2027(b)

149,000

 

151,980

Spirit AeroSystems, Inc., 4.60%,

 

 

 

06/15/2028

96,000

 

95,394

TransDigm UK Holdings PLC, 6.88%,

 

 

 

05/15/2026

301,000

 

316,907

TransDigm, Inc.,

 

 

 

6.50%, 07/15/2024

70,000

 

71,721

6.38%, 06/15/2026

141,000

 

145,145

Triumph Group, Inc., 7.75%,

 

 

 

08/15/2025

331,000

 

328,655

 

 

 

13,944,494

Agricultural & Farm Machinery–0.02%

 

 

Titan International, Inc., 6.50%,

 

 

 

11/30/2023

470,000

 

353,870

Air Freight & Logistics–0.00%

 

 

 

XPO Logistics, Inc., 6.50%,

 

 

 

06/15/2022(b)

84,000

 

84,099

Airlines–5.60%

 

 

 

American Airlines Pass Through Trust,

 

 

 

Series 2017-1, Class B, 4.95%,

 

 

 

02/15/2025

2,076,900

 

2,232,796

Series 2016-1, Class AA, 3.58%,

 

 

 

01/15/2028

1,673,737

 

1,836,253

Series 2019-1, Class B, 3.85%,

 

 

 

02/15/2028

3,613,534

 

3,791,678

Series 2016-3, Class AA, 3.00%,

 

 

 

10/15/2028

4,036,714

 

4,299,037

Series 2017-1, Class AA, 3.65%,

 

 

 

02/15/2029

2,761,247

 

3,045,077

Series 2017-2, Class A, 3.60%,

 

 

 

10/15/2029

3,746,014

 

4,014,579

Series 2017-2, Class AA, 3.35%,

 

 

 

10/15/2029

4,663,913

 

5,044,690

Series 2019-1, Class AA, 3.15%,

 

 

 

02/15/2032

7,379,602

 

7,965,534

Avianca Holdings S.A. (Colombia),

 

 

 

9.00%, 05/10/2023(b)

2,909,000

 

2,465,377

British Airways Pass Through Trust

 

 

 

(United Kingdom),

 

 

 

Series 2019-1, Class A, 3.35%,

 

 

 

06/15/2029(b)

2,556,000

 

2,724,893

Series 2019-1, Class AA, 3.30%,

 

 

 

12/15/2032(b)

6,049,427

 

6,593,548

 

Principal

 

 

 

Amount

 

Value

Airlines–(continued)

 

 

 

Delta Air Lines Pass Through Trust,

 

 

 

Series 2019-1, Class A, 3.40%,

 

 

 

04/25/2024

$ 3,233,000

$

3,443,124

Series 2019-1, Class AA, 3.20%,

 

 

 

04/25/2024

4,673,000

 

4,968,471

Delta Air Lines, Inc.,

 

 

 

3.63%, 03/15/2022

9,961,000

 

10,264,069

3.80%, 04/19/2023

2,065,000

 

2,149,842

2.90%, 10/28/2024

7,922,000

 

7,990,793

3.75%, 10/28/2029

10,445,000

 

10,483,221

LATAM Airlines Group S.A. Pass

 

 

 

Through Trust (Chile),

 

 

 

Series 2015-1, Class A, 4.20%,

 

 

 

11/15/2027

4,849,648

 

5,023,496

Norwegian Air Shuttle ASA Pass Through

 

 

 

Trust (Norway),

 

 

 

Series 2016-1, Class B, 7.50%,

 

 

 

11/10/2023(b)

4,549,019

 

4,824,747

Series 2016-1, Class A, 4.88%,

 

 

 

05/10/2028(b)

4,288,499

 

4,183,809

Southwest Airlines Co., 2.63%,

 

 

 

02/10/2030

3,055,000

 

3,075,493

United Airlines Pass Through Trust,

 

 

 

Series 2014-2, Class B, 4.63%,

 

 

 

09/03/2022

1,594,765

 

1,666,028

Series 2016-1, Class B, 3.65%,

 

 

 

01/07/2026

2,301,310

 

2,410,871

Series 2019-2, Class B, 3.50%,

 

 

 

05/01/2028

2,833,000

 

2,939,440

Series 2018-1, Class A, 3.70%,

 

 

 

03/01/2030

4,649,206

 

4,989,386

Series 2018-1, Class AA, 3.50%,

 

 

 

03/01/2030

4,381,019

 

4,770,132

Series 2019-1, Class A, 4.55%,

 

 

 

08/25/2031

2,021,743

 

2,325,737

Series 2019-1, Class AA, 4.15%,

 

 

 

08/25/2031

3,942,854

 

4,467,608

 

 

 

123,989,729

Alternative Carriers–0.17%

 

 

 

CenturyLink, Inc.,

 

 

 

Series S, 6.45%, 06/15/2021

299,000

 

310,885

Series Y, 7.50%, 04/01/2024

264,000

 

296,450

4.00%, 02/15/2027(b)

1,966,000

 

1,980,548

Level 3 Financing, Inc.,

 

 

 

5.38%, 05/01/2025

717,000

 

733,430

5.25%, 03/15/2026

377,000

 

389,950

 

 

 

3,711,263

Aluminum–0.04%

 

 

 

Alcoa Nederland Holding B.V.,

 

 

 

6.75%, 09/30/2024(b)

600,000

 

616,506

Novelis Corp., 4.75%,

 

 

 

01/30/2030(b)

198,000

 

194,966

 

 

 

811,472

Apparel Retail–0.05%

 

 

 

L Brands, Inc.,

 

 

 

6.88%, 11/01/2035

539,000

 

548,042

6.75%, 07/01/2036

303,000

 

307,575

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco Corporate Bond Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Apparel Retail–(continued)

 

 

 

 

Michaels Stores, Inc., 8.00%,

 

 

 

 

07/15/2027(b)

$

267,000

$

223,065

 

 

 

 

1,078,682

Apparel, Accessories & Luxury Goods–0.03%

 

 

Hanesbrands, Inc.,

 

 

 

 

4.63%, 05/15/2024(b)

 

69,000

 

72,249

4.88%, 05/15/2026(b)

 

560,000

 

587,636

 

 

 

 

659,885

Asset Management & Custody Banks–1.14%

 

 

Affiliated Managers Group, Inc.,

 

 

 

 

4.25%, 02/15/2024

 

4,515,000

 

4,908,673

Apollo Management Holdings L.P.,

 

 

 

 

4.95%, 01/14/2050(b)(c)

 

7,115,000

 

7,161,618

Blackstone Holdings Finance Co. LLC,

 

 

 

 

5.00%, 06/15/2044(b)

 

4,355,000

 

5,643,174

Carlyle Holdings II Finance LLC,

 

 

 

 

5.63%, 03/30/2043(b)

 

5,900,000

 

7,492,917

 

 

 

 

25,206,382

Auto Parts & Equipment–0.04%

 

 

 

 

Adient Global Holdings Ltd., 4.88%,

 

 

 

 

08/15/2026(b)

 

200,000

 

173,005

Dana Financing Luxembourg S.a.r.l.,

 

 

 

 

5.75%, 04/15/2025(b)

 

132,000

 

136,345

Dana, Inc., 5.38%, 11/15/2027

 

221,000

 

223,763

Panther BF Aggregator 2 L.P./Panther

 

 

 

 

Finance Co., Inc. (Canada),

 

 

 

 

6.25%, 05/15/2026(b)

 

135,000

 

138,925

8.50%, 05/15/2027(b)

 

178,000

 

181,444

Tenneco, Inc., 5.00%, 07/15/2026

 

115,000

 

99,190

 

 

 

 

952,672

Automobile Manufacturers–2.85%

 

 

 

Ford Motor Credit Co. LLC,

 

 

 

 

5.09%, 01/07/2021

 

2,887,000

 

2,962,561

5.60%, 01/07/2022

 

410,000

 

432,718

3.35%, 11/01/2022

 

7,372,000

 

7,444,550

5.58%, 03/18/2024

 

5,254,000

 

5,624,923

4.06%, 11/01/2024

 

4,000,000

 

4,078,620

General Motors Financial Co., Inc.,

 

 

 

 

Series B, 6.50%(d)

 

200,000

 

203,651

3.20%, 07/06/2021

 

1,175,000

 

1,189,028

5.10%, 01/17/2024

 

2,352,000

 

2,575,870

Hyundai Capital America,

 

 

 

 

2.85%, 11/01/2022(b)

 

3,237,000

 

3,320,404

4.30%, 02/01/2024(b)

 

14,635,000

 

15,770,048

2.65%, 02/10/2025(b)

 

5,060,000

 

5,161,388

3.50%, 11/02/2026(b)

 

6,823,000

 

7,218,826

J.B. Poindexter & Co., Inc., 7.13%,

 

 

 

 

04/15/2026(b)

 

539,000

 

570,479

Toyota Motor Credit Corp., 2.15%,

 

 

 

 

02/13/2030

 

3,406,000

 

3,449,445

Volkswagen Group of America

 

 

 

 

Finance LLC (Germany),

 

 

 

 

2.65%, (3 mo. USD LIBOR +

 

 

 

 

0.94%), 11/12/2021(b)(c)

 

2,876,000

 

2,905,495

3.20%, 09/26/2026(b)

 

200,000

 

210,274

 

 

 

 

63,118,280

 

Principal

 

 

 

Amount

 

Value

Automotive Retail–0.23%

 

 

 

Advance Auto Parts, Inc., 4.50%,

 

 

 

12/01/2023

$ 3,400,000

$

3,738,857

Asbury Automotive Group, Inc.,

 

 

 

4.75%, 03/01/2030(b)

113,000

 

115,260

AutoZone, Inc., 3.75%,

 

 

 

04/18/2029

200,000

 

226,460

Lithia Motors, Inc.,

 

 

 

5.25%, 08/01/2025(b)

108,000

 

112,905

4.63%, 12/15/2027(b)

106,000

 

108,775

Murphy Oil USA, Inc., 5.63%,

 

 

 

05/01/2027

300,000

 

317,895

Penske Automotive Group, Inc.,

 

 

 

5.50%, 05/15/2026

509,000

 

529,029

 

 

 

5,149,181

Biotechnology–2.22%

 

 

 

AbbVie, Inc.,

 

 

 

2.30%, 11/21/2022(b)

6,144,000

 

6,249,433

3.75%, 11/14/2023

250,000

 

268,106

2.60%, 11/21/2024(b)

10,844,000

 

11,213,492

3.20%, 11/21/2029(b)

8,501,000

 

8,984,637

4.05%, 11/21/2039(b)

9,357,000

 

10,352,006

4.88%, 11/14/2048

4,254,000

 

5,242,897

Amgen, Inc.,

 

 

 

2.45%, 02/21/2030

1,695,000

 

1,725,456

3.15%, 02/21/2040

3,286,000

 

3,397,843

3.38%, 02/21/2050

1,694,000

 

1,731,589

 

 

 

49,165,459

Brewers–0.20%

 

 

 

Anheuser-Busch InBev Worldwide, Inc.

 

 

 

(Belgium),

 

 

 

4.00%, 04/13/2028

300,000

 

338,473

8.00%, 11/15/2039

2,414,000

 

3,914,295

Molson Coors Beverage Co., 5.00%,

 

 

 

05/01/2042

249,000

 

282,185

 

 

 

4,534,953

Broadcasting–0.32%

 

 

 

AMC Networks, Inc.,

 

 

 

5.00%, 04/01/2024

329,000

 

331,467

4.75%, 08/01/2025

61,000

 

60,926

Clear Channel Worldwide Holdings,

 

 

 

Inc., 9.25%, 02/15/2024(b)

223,000

 

237,402

Gray Television, Inc., 7.00%,

 

 

 

05/15/2027(b)

167,000

 

181,462

iHeartCommunications, Inc., 8.38%,

 

 

 

05/01/2027

275,000

 

299,145

NBCUniversal Media LLC, 5.95%,

 

 

 

04/01/2041

3,964,000

 

5,780,916

TV Azteca S.A.B. de C.V. (Mexico),

 

 

 

8.25%, 08/09/2024(b)

300,000

 

272,126

 

 

 

7,163,444

Building Products–0.06%

 

 

 

Advanced Drainage Systems, Inc.,

 

 

 

5.00%, 09/30/2027(b)

138,000

 

143,051

Owens Corning, 4.30%,

 

 

 

07/15/2047

250,000

 

268,386

Standard Industries, Inc.,

 

 

 

6.00%, 10/15/2025(b)

725,000

 

759,430

5.00%, 02/15/2027(b)

47,000

 

48,360

 

 

 

1,219,227

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco Corporate Bond Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Cable & Satellite–1.98%

 

 

 

 

Altice Financing S.A. (Luxembourg),

 

 

 

 

7.50%, 05/15/2026(b)

$

260,000

$

274,144

CCO Holdings LLC/CCO Holdings Capital

 

 

 

 

Corp.,

 

 

 

 

5.75%, 09/01/2023

 

576,000

 

582,552

5.75%, 02/15/2026(b)

 

1,273,000

 

1,325,893

4.50%, 08/15/2030(b)

 

131,000

 

132,719

Charter Communications Operating LLC/

 

 

 

 

Charter Communications Operating

 

 

 

 

Capital Corp.,

 

 

 

 

4.91%, 07/23/2025

 

5,493,000

 

6,158,334

5.38%, 04/01/2038

 

2,239,000

 

2,575,146

5.75%, 04/01/2048

 

2,515,000

 

3,003,664

6.83%, 10/23/2055

 

4,449,000

 

6,011,803

Comcast Corp.,

 

 

 

 

3.95%, 10/15/2025

 

1,775,000

 

1,987,740

6.45%, 03/15/2037

 

1,885,000

 

2,786,319

4.60%, 10/15/2038

 

2,560,000

 

3,226,996

3.25%, 11/01/2039

 

1,040,000

 

1,126,575

3.45%, 02/01/2050

 

4,305,000

 

4,759,236

4.95%, 10/15/2058

 

2,621,000

 

3,586,240

Cox Communications, Inc., 3.35%,

 

 

 

 

09/15/2026(b)

 

2,316,000

 

2,473,673

CSC Holdings LLC,

 

 

 

 

7.75%, 07/15/2025(b)

 

434,000

 

457,866

10.88%, 10/15/2025(b)

 

356,000

 

391,271

6.63%, 10/15/2025(b)

 

200,000

 

209,502

5.50%, 05/15/2026(b)

 

265,000

 

274,984

DISH DBS Corp.,

 

 

 

 

5.88%, 11/15/2024

 

239,000

 

245,648

7.75%, 07/01/2026

 

130,000

 

139,933

Globo Comunicacao e Participacoes

 

 

 

 

S.A. (Brazil), 4.88%,

 

 

 

 

01/22/2030(b)

 

1,191,000

 

1,193,084

UPC Holding B.V. (Netherlands),

 

 

 

 

5.50%, 01/15/2028(b)

 

200,000

 

203,190

Virgin Media Secured Finance PLC

 

 

 

 

(United Kingdom), 5.50%,

 

 

 

 

08/15/2026(b)

 

239,000

 

246,502

VTR Finance B.V. (Chile), 6.88%,

 

 

 

 

01/15/2024(b)

 

200,000

 

204,333

Ziggo B.V. (Netherlands), 5.50%,

 

 

 

 

01/15/2027(b)

 

225,000

 

232,175

 

 

 

 

43,809,522

Casinos & Gaming–0.07%

 

 

 

 

Boyd Gaming Corp.,

 

 

 

 

6.38%, 04/01/2026

 

115,000

 

120,100

6.00%, 08/15/2026

 

113,000

 

116,396

MGM Resorts International,

 

 

 

 

7.75%, 03/15/2022

 

301,000

 

330,131

6.00%, 03/15/2023

 

559,000

 

602,789

Wynn Las Vegas LLC/Wynn Las Vegas

 

 

 

 

Capital Corp., 5.50%,

 

 

 

 

03/01/2025(b)

 

319,000

 

313,813

 

 

 

 

1,483,229

Coal & Consumable Fuels–0.02%

 

 

 

 

SunCoke Energy Partners

 

 

 

 

L.P./SunCoke Energy Partners

 

 

 

 

Finance Corp., 7.50%,

 

 

 

 

06/15/2025(b)

 

602,000

 

543,299

 

 

Principal

 

 

 

 

Amount

 

Value

Commodity Chemicals–0.13%

 

 

 

 

Alpek S.A.B. de C.V. (Mexico),

 

 

 

 

4.25%, 09/18/2029(b)

$

1,987,000

$

2,077,408

Koppers, Inc., 6.00%,

 

 

 

 

02/15/2025(b)

 

219,000

 

216,260

Nufarm Australia Ltd./Nufarm

 

 

 

 

Americas, Inc. (Australia), 5.75%,

 

 

 

 

04/30/2026(b)

 

153,000

 

151,141

Olin Corp., 5.63%, 08/01/2029

 

509,000

 

514,421

 

 

 

 

2,959,230

Communications Equipment–0.03%

 

 

Hughes Satellite Systems Corp.,

 

 

 

 

7.63%, 06/15/2021

 

281,000

 

296,421

5.25%, 08/01/2026

 

263,000

 

289,063

 

 

 

 

585,484

Construction & Engineering–0.18%

 

 

 

AECOM, 5.13%, 03/15/2027

 

133,000

 

137,804

Shea Homes L.P./Shea Homes

 

 

 

 

Funding Corp., 4.75%,

 

 

 

 

02/15/2028(b)

 

3,579,000

 

3,587,572

Valmont Industries, Inc., 5.00%,

 

 

 

 

10/01/2044

 

250,000

 

288,220

 

 

 

 

4,013,596

Construction Machinery & Heavy Trucks–0.11%

 

 

Ashtead Capital, Inc. (United

 

 

 

 

Kingdom), 4.00%,

 

 

 

 

05/01/2028(b)

 

2,115,000

 

2,137,675

Westinghouse Air Brake Technologies

 

 

 

 

Corp., 4.95%, 09/15/2028

 

209,000

 

237,847

 

 

 

 

2,375,522

Construction Materials–1.42%

 

 

 

 

Carrier Global Corp.,

 

 

 

 

2.24%, 02/15/2025(b)

 

7,631,000

 

7,772,701

2.49%, 02/15/2027(b)

 

2,982,000

 

3,038,671

2.72%, 02/15/2030(b)

 

6,236,000

 

6,338,958

3.38%, 04/05/2040(b)

 

5,956,000

 

6,122,869

3.58%, 04/05/2050(b)

 

4,027,000

 

4,141,102

CRH America Finance, Inc. (Ireland),

 

 

 

 

3.95%, 04/04/2028(b)

 

3,524,000

 

3,999,721

 

 

 

 

31,414,022

Consumer Finance–1.29%

 

 

 

 

Ally Financial, Inc.,

 

 

 

 

4.13%, 03/30/2020

 

4,155,000

 

4,167,507

5.13%, 09/30/2024

 

434,000

 

481,699

4.63%, 03/30/2025

 

1,303,000

 

1,422,869

American Express Co., Series C,

 

 

 

 

4.90% (3 mo. USD LIBOR +

 

 

 

 

3.29%)(c)(d)

 

3,075,000

 

3,063,100

Capital One Financial Corp., 3.75%,

 

 

 

 

03/09/2027

 

6,970,000

 

7,619,932

Credit Acceptance Corp.,

 

 

 

 

5.13%, 12/31/2024(b)

 

1,381,000

 

1,425,882

6.63%, 03/15/2026(b)

 

1,923,000

 

2,023,751

Discover Bank, 4.68% (5 yr.

 

 

 

 

U.S. Swap Rate + 1.73%),

 

 

 

 

08/09/2028(c)

 

1,990,000

 

2,116,395

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco Corporate Bond Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Consumer Finance–(continued)

 

 

 

 

Navient Corp.,

 

 

 

 

8.00%, 03/25/2020

$

99,000

$

99,516

7.25%, 01/25/2022

 

160,000

 

168,685

7.25%, 09/25/2023

 

1,040,000

 

1,120,590

5.00%, 03/15/2027

 

486,000

 

471,274

Synchrony Financial, 4.50%,

 

 

 

 

07/23/2025

 

4,000,000

 

4,399,021

 

 

 

 

28,580,221

Copper–0.64%

 

 

 

 

First Quantum Minerals Ltd. (Zambia),

 

 

 

 

7.50%, 04/01/2025(b)

 

548,000

 

523,112

Freeport-McMoRan, Inc.,

 

 

 

 

5.00%, 09/01/2027

 

4,626,000

 

4,574,513

4.13%, 03/01/2028

 

4,062,000

 

3,854,229

4.25%, 03/01/2030

 

4,062,000

 

3,827,419

5.40%, 11/14/2034

 

1,102,000

 

1,077,401

Taseko Mines Ltd. (Canada), 8.75%,

 

 

 

 

06/15/2022(b)

 

445,000

 

401,751

 

 

 

 

14,258,425

Data Processing & Outsourced Services–0.49%

 

 

Alliance Data Systems Corp., 4.75%,

 

 

 

 

12/15/2024(b)

 

2,112,000

 

2,077,680

Cardtronics, Inc./Cardtronics USA,

 

 

 

 

Inc., 5.50%, 05/01/2025(b)

 

212,000

 

217,918

Fiserv, Inc., 4.20%, 10/01/2028

 

2,400,000

 

2,746,180

PayPal Holdings, Inc.,

 

 

 

 

2.65%, 10/01/2026

 

3,243,000

 

3,389,923

2.85%, 10/01/2029

 

2,247,000

 

2,363,675

 

 

 

 

10,795,376

Department Stores–0.01%

 

 

 

 

Kohl's Corp., 5.55%, 07/17/2045

 

249,000

 

267,177

Diversified Banks–10.07%

 

 

 

 

Africa Finance Corp. (Supranational),

 

 

 

 

4.38%, 04/17/2026(b)

 

7,620,000

 

8,247,583

ANZ New Zealand (Int'l) Ltd. (New

 

 

 

 

Zealand), 2.13%, 07/28/2021(b)

 

3,990,000

 

4,034,676

Australia & New Zealand Banking Group

 

 

 

 

Ltd. (Australia),

 

 

 

 

2.95%, 07/22/2030(b)(c)

 

3,576,000

 

3,657,759

6.75%(b)(d)

 

3,847,000

 

4,345,514

Banco del Estado de Chile (Chile),

 

 

 

 

2.70%, 01/09/2025(b)

 

2,875,000

 

2,910,938

Bank of America Corp.,

 

 

 

 

3.86%, (3 mo. USD LIBOR +

 

 

 

 

0.94%), 07/23/2024(c)

 

8,727,000

 

9,342,152

7.75%, 05/14/2038

 

2,850,000

 

4,614,856

Series AA, 6.10%(d)

 

6,420,000

 

7,121,738

Series DD, 6.30%(d)

 

2,040,000

 

2,303,497

Series Z, 6.50%(d)

 

4,500,000

 

4,969,627

Bank of China Ltd. (China), 5.00%,

 

 

 

 

11/13/2024(b)

 

2,850,000

 

3,182,622

Barclays Bank PLC (United Kingdom),

 

 

 

 

5.14%, 10/14/2020

 

765,000

 

781,498

7.63%, 11/21/2022

 

200,000

 

222,974

Barclays PLC (United Kingdom),

 

 

 

 

4.84%, 05/09/2028

 

965,000

 

1,068,310

BBVA Bancomer S.A. (Mexico),

 

 

 

 

4.38%, 04/10/2024(b)

 

2,015,000

 

2,151,869

 

Principal

 

 

 

Amount

 

Value

Diversified Banks–(continued)

 

 

 

BNP Paribas S.A. (France),

 

 

 

4.38%, 03/01/2033(b)(c)

$ 5,330,000

$

5,895,719

4.50%(b)(c)(d)

6,218,000

 

5,942,076

BPCE S.A. (France), 2.38%,

 

 

 

01/14/2025(b)

3,971,000

 

4,032,094

Citigroup, Inc.,

 

 

 

3.50%, 05/15/2023

3,980,000

 

4,187,778

2.88%, (3 mo. USD LIBOR +

 

 

 

0.95%), 07/24/2023(c)

1,575,000

 

1,616,939

5.50%, 09/13/2025

4,845,000

 

5,676,203

3.98%, 03/20/2030(c)

4,000,000

 

4,529,983

4.65%, 07/23/2048

1,983,000

 

2,629,173

Series Q, 5.95%(d)

1,570,000

 

1,593,212

Series T, 6.25%(d)

2,110,000

 

2,345,613

Series U, 5.00%(d)

7,500,000

 

7,688,962

Series V, 4.70%(c)(d)

2,340,000

 

2,312,213

Credit Agricole S.A. (France),

 

 

 

8.13%(b)(d)

202,000

 

239,044

Federation des caisses Desjardins du

 

 

 

Quebec (Canada), 2.05%,

 

 

 

02/10/2025(b)

5,537,000

 

5,608,319

Global Bank Corp. (Panama), 4.50%,

 

 

 

10/20/2021(b)

6,573,000

 

6,747,184

HSBC Holdings PLC (United Kingdom),

 

 

 

4.00%, 03/30/2022

2,070,000

 

2,165,022

2.69%, (3 mo. USD LIBOR +

 

 

 

1.00%), 05/18/2024(c)

2,663,000

 

2,680,842

6.00%(d)

5,365,000

 

5,578,715

ING Groep N.V. (Netherlands),

 

 

 

6.00%(d)

465,000

 

464,954

JPMorgan Chase & Co.,

 

 

 

2.30%, 08/15/2021

4,545,000

 

4,553,408

2.70%, (3 mo. USD LIBOR +

 

 

 

0.89%), 07/23/2024(c)

5,790,000

 

5,842,170

3.63%, 12/01/2027

2,750,000

 

2,982,709

3.70%, 05/06/2030(c)

4,000,000

 

4,458,246

4.26%, (3 mo. USD LIBOR +

 

 

 

1.58%), 02/22/2048(c)

1,935,000

 

2,423,921

Series W, 2.69% (3 mo. USD

 

 

 

LIBOR + 1.00%), 05/15/2047(c)

5,770,000

 

5,116,519

Series HH, 4.60% (SOFR +

 

 

 

3.13%)(c)(d)

3,330,000

 

3,350,813

Series I, 5.24% (3 mo. USD LIBOR

 

 

 

+ 3.47%)(c)(d)

2,726,000

 

2,725,305

Series V, 5.23% (3 mo. USD LIBOR

 

 

 

+ 3.32%)(c)(d)

2,005,000

 

1,998,474

National Australia Bank Ltd.

 

 

 

(Australia), 3.93%,

 

 

 

08/02/2034(b)(c)

1,690,000

 

1,848,834

Royal Bank of Scotland Group PLC (The)

 

 

 

(United Kingdom),

 

 

 

3.50%, (3 mo. USD LIBOR +

 

 

 

1.48%), 05/15/2023(c)

5,711,000

 

5,899,077

3.75%, 11/01/2029(c)

1,895,000

 

1,970,882

SMBC Aviation Capital Finance DAC

 

 

 

(Ireland),

 

 

 

3.00%, 07/15/2022(b)

3,147,000

 

3,249,321

4.13%, 07/15/2023(b)

4,076,000

 

4,382,807

Societe Generale S.A. (France),

 

 

 

7.38%(b)(d)

202,000

 

211,550

7.38%(b)(d)

1,507,000

 

1,578,243

7.38%(b)(d)

3,665,000

 

3,956,166

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco Corporate Bond Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Diversified Banks–(continued)

 

 

 

 

Standard Chartered PLC (United

 

 

 

 

Kingdom),

 

 

 

 

3.09%, (3 mo. USD LIBOR +

 

 

 

 

1.20%), 09/10/2022(b)(c)

$

3,395,000

$

3,425,373

2.97%, (3 mo. USD LIBOR +

 

 

 

 

1.15%), 01/20/2023(b)(c)

 

1,442,000

 

1,454,140

4.30%, 02/19/2027(b)

 

1,628,000

 

1,752,021

7.50%(b)(d)

 

200,000

 

210,187

7.75%(b)(d)

 

2,690,000

 

2,899,793

Sumitomo Mitsui Financial Group, Inc.

 

 

 

 

(Japan), 3.04%, 07/16/2029

 

4,755,000

 

5,064,737

Wells Fargo & Co.,

 

 

 

 

4.15%, 01/24/2029

 

4,000,000

 

4,599,317

5.38%, 11/02/2043

 

7,865,000

 

10,400,742

4.75%, 12/07/2046

 

2,045,000

 

2,572,460

Westpac Banking Corp. (Australia),

 

 

 

 

2.89%, 02/04/2030(c)

 

3,166,000

 

3,213,023

 

 

 

 

223,029,896

Diversified Capital Markets–1.03%

 

 

 

Credit Suisse AG (Switzerland),

 

 

 

 

3.00%, 10/29/2021

 

2,065,000

 

2,114,045

Credit Suisse Group AG (Switzerland),

 

 

 

 

7.50%(b)(d)

 

2,410,000

 

2,603,149

7.25%(b)(d)

 

330,000

 

364,879

5.10%(b)(d)

 

4,230,000

 

4,203,563

Macquarie Bank Ltd. (Australia),

 

 

 

 

6.13%(b)(c)(d)

 

5,010,000

 

5,295,996

UBS Group AG (Switzerland), 3.13%

 

 

 

 

(3 mo. USD LIBOR + 1.47%),

 

 

 

 

08/13/2030(b)(c)

 

7,847,000

 

8,327,543

 

 

 

 

22,909,175

Diversified Chemicals–0.21%

 

 

 

 

Chemours Co. (The), 7.00%,

 

 

 

 

05/15/2025

 

105,000

 

98,131

Dow Chemical Co. (The), 3.15%,

 

 

 

 

05/15/2024

 

2,023,000

 

2,148,589

OCP S.A. (Morocco), 4.50%,

 

 

 

 

10/22/2025(b)

 

2,259,000

 

2,446,877

 

 

 

 

4,693,597

Diversified Metals & Mining–0.60%

 

 

 

Corp. Nacional del Cobre de Chile (Chile),

 

 

 

 

3.15%, 01/14/2030(b)

 

3,425,000

 

3,509,206

3.70%, 01/30/2050(b)

 

2,345,000

 

2,373,102

Hudbay Minerals, Inc. (Canada),

 

 

 

 

7.63%, 01/15/2025(b)

 

285,000

 

275,143

Teck Resources Ltd. (Canada),

 

 

 

 

6.13%, 10/01/2035

 

5,753,000

 

6,844,580

Vedanta Resources Ltd. (India),

 

 

 

 

6.38%, 07/30/2022(b)

 

291,000

 

278,141

 

 

 

 

13,280,172

Diversified REITs–0.99%

 

 

 

 

iStar, Inc., 4.75%, 10/01/2024

 

560,000

 

572,799

Trust F/1401 (Mexico),

 

 

 

 

5.25%, 12/15/2024(b)

 

4,124,000

 

4,556,669

5.25%, 01/30/2026(b)

 

3,705,000

 

4,076,787

4.87%, 01/15/2030(b)

 

4,150,000

 

4,551,512

6.39%, 01/15/2050(b)

 

6,695,000

 

7,872,885

 

 

Principal

 

 

 

 

Amount

 

Value

Diversified REITs–(continued)

 

 

 

 

VICI Properties L.P./VICI Note Co., Inc.,

 

 

 

 

3.50%, 02/15/2025(b)

$

93,000

$

93,319

3.75%, 02/15/2027(b)

 

93,000

 

92,477

4.13%, 08/15/2030(b)

 

93,000

 

93,291

 

 

 

 

21,909,739

Drug Retail–0.17%

 

 

 

 

CVS Pass Through Trust, 5.77%,

 

 

 

 

01/10/2033(b)

 

1,772,364

 

2,113,406

CVS Pass-Through Trust, 6.04%,

 

 

 

 

12/10/2028

 

1,341,328

 

1,548,071

 

 

 

 

3,661,477

Electric Utilities–2.18%

 

 

 

 

Commonwealth Edison Co.,

 

 

 

 

Series 127, 3.20%, 11/15/2049

 

4,289,000

 

4,557,861

DPL, Inc., 4.35%, 04/15/2029(b)

 

42,000

 

39,285

Drax Finco PLC (United Kingdom),

 

 

 

 

6.63%, 11/01/2025(b)

 

3,600,000

 

3,766,086

Electricite de France S.A. (France),

 

 

 

 

6.00%, 01/22/2114(b)

 

6,655,000

 

8,667,771

Georgia Power Co.,

 

 

 

 

2.85%, 05/15/2022

 

3,862,000

 

3,987,689

Series A, 2.20%, 09/15/2024

 

10,999,000

 

11,263,669

Southern Co. (The), Series B, 5.50%,

 

 

 

 

03/15/2057(c)

 

11,592,000

 

11,941,359

Xcel Energy, Inc., 3.50%,

 

 

 

 

12/01/2049

 

3,632,000

 

4,011,226

 

 

 

 

48,234,946

Electrical Components & Equipment–0.03%

 

 

EnerSys,

 

 

 

 

5.00%, 04/30/2023(b)

 

476,000

 

499,603

4.38%, 12/15/2027(b)

 

107,000

 

108,471

 

 

 

 

608,074

Electronic Components–1.43%

 

 

 

 

Corning, Inc., 5.45%, 11/15/2079

 

28,236,000

 

31,575,786

Electronic Equipment & Instruments–0.03%

 

 

Itron, Inc., 5.00%, 01/15/2026(b)

 

239,000

 

246,684

MTS Systems Corp., 5.75%,

 

 

 

 

08/15/2027(b)

 

316,000

 

322,430

 

 

 

 

569,114

Environmental & Facilities Services–0.01%

 

 

Waste Pro USA, Inc., 5.50%,

 

 

 

 

02/15/2026(b)

 

219,000

 

214,111

Fertilizers & Agricultural Chemicals–0.01%

 

 

OCI N.V. (Netherlands), 6.63%,

 

 

 

 

04/15/2023(b)

 

211,000

 

219,335

Financial Exchanges & Data–0.12%

 

 

Moody's Corp.,

 

 

 

 

4.88%, 02/15/2024

 

232,000

 

258,369

5.25%, 07/15/2044

 

1,665,000

 

2,280,892

MSCI, Inc., 5.25%, 11/15/2024(b)

 

60,000

 

61,769

 

 

 

 

2,601,030

Food Distributors–0.02%

 

 

 

 

US Foods, Inc., 5.88%,

 

 

 

 

06/15/2024(b)

 

466,000

 

475,127

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco Corporate Bond Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Food Retail–0.34%

 

 

 

 

Albertson's Cos., Inc./Safeway, Inc./New

 

 

 

 

Albertson's L.P./Albertson's LLC,

 

 

 

 

3.50%, 02/15/2023(b)

$

3,502,000

$

3,515,132

6.63%, 06/15/2024

 

363,000

 

373,886

4.63%, 01/15/2027(b)

 

248,000

 

244,739

5.88%, 02/15/2028(b)

 

193,000

 

200,942

4.88%, 02/15/2030(b)

 

1,812,000

 

1,816,530

Alimentation Couche-Tard, Inc.

 

 

 

 

(Canada), 2.95%, 01/25/2030(b)

 

1,317,000

 

1,357,142

 

 

 

 

7,508,371

Forest Products–0.02%

 

 

 

 

Norbord, Inc. (Canada), 5.75%,

 

 

 

 

07/15/2027(b)

 

410,000

 

430,642

Gas Utilities–0.08%

 

 

 

 

AmeriGas Partners L.P./AmeriGas

 

 

 

 

Finance Corp.,

 

 

 

 

5.63%, 05/20/2024

 

298,000

 

310,572

5.88%, 08/20/2026

 

464,000

 

482,268

Suburban Propane Partners

 

 

 

 

L.P./Suburban Energy Finance

 

 

 

 

Corp., 5.50%, 06/01/2024

 

590,000

 

585,286

Superior Plus L.P./Superior General

 

 

 

 

Partner, Inc. (Canada), 7.00%,

 

 

 

 

07/15/2026(b)

 

339,000

 

363,695

 

 

 

 

1,741,821

Health Care Equipment–0.00%

 

 

 

 

Teleflex, Inc., 4.88%, 06/01/2026

 

50,000

 

52,267

Health Care Facilities–0.83%

 

 

 

 

Acadia Healthcare Co., Inc., 6.50%,

 

 

 

 

03/01/2024

 

164,000

 

168,783

HCA Healthcare, Inc., 6.25%,

 

 

 

 

02/15/2021

 

621,000

 

645,483

HCA, Inc.,

 

 

 

 

5.00%, 03/15/2024

 

9,500,000

 

10,565,418

5.38%, 02/01/2025

 

242,000

 

268,036

5.25%, 04/15/2025

 

151,000

 

171,682

5.88%, 02/15/2026

 

166,000

 

187,701

5.38%, 09/01/2026

 

111,000

 

123,743

5.50%, 06/15/2047

 

5,161,000

 

6,143,779

 

 

 

 

18,274,625

Health Care REITs–0.54%

 

 

 

 

Diversified Healthcare Trust, 6.75%,

 

 

 

 

12/15/2021

 

2,606,000

 

2,770,726

Healthpeak Properties, Inc., 4.25%,

 

 

 

 

11/15/2023

 

983,000

 

1,070,504

MPT Operating Partnership L.P./MPT

 

 

 

 

Finance Corp.,

 

 

 

 

5.00%, 10/15/2027

 

605,000

 

632,851

4.63%, 08/01/2029

 

2,463,000

 

2,592,320

Physicians Realty L.P., 4.30%,

 

 

 

 

03/15/2027

 

1,775,000

 

1,980,806

Welltower, Inc., 3.10%,

 

 

 

 

01/15/2030

 

2,680,000

 

2,864,642

 

 

 

 

11,911,849

Health Care Services–1.16%

 

 

 

 

AMN Healthcare, Inc., 5.13%,

 

 

 

 

10/01/2024(b)

 

181,000

 

186,053

 

 

Principal

 

 

 

 

Amount

 

Value

Health Care Services–(continued)

 

 

 

Cigna Corp.,

 

 

 

 

4.50%, 03/15/2021(b)

$

1,860,000

$

1,898,171

3.75%, 07/15/2023

 

5,052,000

 

5,381,620

2.72%, (3 mo. USD LIBOR +

 

 

 

 

0.89%), 07/15/2023(c)

 

5,327,000

 

5,394,803

4.38%, 10/15/2028

 

1,938,000

 

2,206,069

4.80%, 08/15/2038

 

5,467,000

 

6,586,594

CVS Health Corp., 2.63%,

 

 

 

 

08/15/2024

 

3,015,000

 

3,116,163

Envision Healthcare Corp., 8.75%,

 

 

 

 

10/15/2026(b)

 

145,000

 

77,162

Hadrian Merger Sub, Inc., 8.50%,

 

 

 

 

05/01/2026(b)

 

371,000

 

380,404

MPH Acquisition Holdings LLC,

 

 

 

 

7.13%, 06/01/2024(b)

 

281,000

 

262,091

Team Health Holdings, Inc., 6.38%,

 

 

 

 

02/01/2025(b)

 

172,000

 

95,101

 

 

 

 

25,584,231

Home Improvement Retail–0.35%

 

 

 

Hillman Group, Inc. (The), 6.38%,

 

 

 

 

07/15/2022(b)

 

131,000

 

117,859

Lowe's Cos., Inc., 3.65%,

 

 

 

 

04/05/2029

 

6,778,000

 

7,520,159

 

 

 

 

7,638,018

Homebuilding–1.22%

 

 

 

 

Ashton Woods USA LLC/Ashton Woods

 

 

 

 

Finance Co., 9.88%,

 

 

 

 

04/01/2027(b)

 

251,000

 

284,972

Beazer Homes USA, Inc., 5.88%,

 

 

 

 

10/15/2027

 

41,000

 

41,616

KB Home, 4.80%, 11/15/2029

 

456,000

 

479,940

Lennar Corp.,

 

 

 

 

8.38%, 01/15/2021

 

36,000

 

37,645

5.38%, 10/01/2022

 

324,000

 

344,351

4.75%, 11/15/2022

 

172,000

 

180,294

5.25%, 06/01/2026

 

636,000

 

702,683

M.D.C. Holdings, Inc.,

 

 

 

 

3.85%, 01/15/2030

 

8,643,000

 

8,659,206

6.00%, 01/15/2043

 

12,008,000

 

13,277,546

Mattamy Group Corp. (Canada),

 

 

 

 

5.25%, 12/15/2027(b)

 

174,000

 

180,525

4.63%, 03/01/2030(b)

 

1,700,000

 

1,652,477

Meritage Homes Corp., 5.13%,

 

 

 

 

06/06/2027

 

322,000

 

359,142

PulteGroup, Inc., 6.38%,

 

 

 

 

05/15/2033

 

15,000

 

18,429

Taylor Morrison Communities, Inc.,

 

 

 

 

6.63%, 07/15/2027(b)

 

352,000

 

382,578

5.75%, 01/15/2028(b)

 

226,000

 

250,346

Taylor Morrison Communities,

 

 

 

 

Inc./Taylor Morrison Holdings II,

 

 

 

 

Inc., 5.88%, 04/15/2023(b)

 

57,000

 

61,156

 

 

 

 

26,912,906

Hotel & Resort REITs–0.09%

 

 

 

 

Service Properties Trust,

 

 

 

 

4.95%, 02/15/2027

 

1,665,000

 

1,768,722

4.95%, 10/01/2029

 

249,000

 

262,938

 

 

 

 

2,031,660

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

14

Invesco Corporate Bond Fund

 

Principal

 

 

 

Amount

 

Value

Hotels, Resorts & Cruise Lines–0.20%

 

 

Royal Caribbean Cruises Ltd.,

 

 

 

3.70%, 03/15/2028

$ 4,310,000

$

4,428,559

Household Products–0.06%

 

 

 

Reynolds Group Issuer, Inc./LLC,

 

 

 

5.13%, 07/15/2023(b)

90,000

 

91,088

7.00%, 07/15/2024(b)

732,000

 

740,239

Spectrum Brands, Inc.,

 

 

 

5.75%, 07/15/2025

331,000

 

340,099

5.00%, 10/01/2029(b)

108,000

 

111,831

 

 

 

1,283,257

Independent Power Producers & Energy Traders–0.08%

AES Corp. (The), 5.50%,

 

 

 

04/15/2025

733,000

 

751,626

Calpine Corp., 5.50%, 02/01/2024

248,000

 

244,283

Enviva Partners L.P./Enviva Partners

 

 

 

Finance Corp., 6.50%,

 

 

 

01/15/2026(b)

210,000

 

218,929

NRG Energy, Inc., 6.63%,

 

 

 

01/15/2027

622,000

 

649,660

 

 

 

1,864,498

Industrial Conglomerates–0.78%

 

 

 

GE Capital International Funding Co.

 

 

 

Unlimited Co., 4.42%,

 

 

 

11/15/2035

5,911,000

 

6,758,387

General Electric Co., 5.55%,

 

 

 

01/05/2026

9,094,000

 

10,610,607

 

 

 

17,368,994

Industrial Machinery–0.25%

 

 

 

Cleaver-Brooks, Inc., 7.88%,

 

 

 

03/01/2023(b)

576,000

 

569,039

EnPro Industries, Inc., 5.75%,

 

 

 

10/15/2026

489,000

 

520,955

Mueller Industries, Inc., 6.00%,

 

 

 

03/01/2027

492,000

 

498,321

Parker-Hannifin Corp., 3.25%,

 

 

 

06/14/2029

3,633,000

 

3,924,912

 

 

 

5,513,227

Industrial REITs–0.16%

 

 

 

Cibanco S.A. Ibm/PLA Administradora

 

 

 

Industrial S de RL de C.V. (Mexico),

 

 

 

4.96%, 07/18/2029(b)

1,844,000

 

1,993,825

Prologis L.P.,

 

 

 

2.13%, 04/15/2027

640,000

 

648,302

3.00%, 04/15/2050

796,000

 

812,089

 

 

 

3,454,216

Integrated Oil & Gas–1.35%

 

 

 

Occidental Petroleum Corp., 2.90%,

 

 

 

08/15/2024

12,219,000

 

12,392,252

Petrobras Global Finance B.V.

 

 

 

(Brazil), 5.75%, 02/01/2029

353,000

 

398,625

Petroleos Mexicanos (Mexico),

 

 

 

6.88%, 08/04/2026

110,000

 

120,092

5.95%, 01/28/2031(b)

115,000

 

112,700

6.95%, 01/28/2060(b)

1,670,000

 

1,609,463

 

Principal

 

 

 

Amount

 

Value

Integrated Oil & Gas–(continued)

 

 

 

Saudi Arabian Oil Co. (Saudi Arabia),

 

 

 

2.88%, 04/16/2024(b)

$10,449,000

$

10,739,740

4.25%, 04/16/2039(b)

1,687,000

 

1,873,649

4.38%, 04/16/2049(b)

2,407,000

 

2,730,202

 

 

 

29,976,723

Integrated Telecommunication Services–1.97%

 

 

Altice France S.A. (France), 7.38%,

 

 

 

05/01/2026(b)

400,000

 

420,220

AT&T, Inc.,

 

 

 

3.07%, (3 mo. USD LIBOR +

 

 

 

1.18%), 06/12/2024(c)

2,832,000

 

2,867,127

5.25%, 03/01/2037

2,660,000

 

3,282,854

5.15%, 03/15/2042

3,670,000

 

4,486,584

5.35%, 12/15/2043

3,360,000

 

4,174,534

4.75%, 05/15/2046

2,895,000

 

3,418,703

5.15%, 02/15/2050

8,382,000

 

10,518,335

5.70%, 03/01/2057

2,735,000

 

3,782,862

Cincinnati Bell, Inc.,

 

 

 

7.00%, 07/15/2024(b)

202,000

 

212,855

8.00%, 10/15/2025(b)

43,000

 

46,324

CommScope, Inc., 6.00%,

 

 

 

03/01/2026(b)

413,000

 

424,690

Embarq Corp., 8.00%, 06/01/2036

425,000

 

453,379

Frontier Communications Corp.,

 

 

 

10.50%, 09/15/2022

146,000

 

66,658

11.00%, 09/15/2025

159,000

 

73,140

Telecom Italia Capital S.A. (Italy),

 

 

 

6.38%, 11/15/2033

46,000

 

53,407

7.20%, 07/18/2036

589,000

 

730,861

Telefonica Emisiones S.A. (Spain),

 

 

 

7.05%, 06/20/2036

2,865,000

 

4,137,943

T-Mobile USA, Inc., 6.50%,

 

 

 

01/15/2026

1,352,000

 

1,425,887

Verizon Communications, Inc.,

 

 

 

4.81%, 03/15/2039

2,267,000

 

2,909,817

Virgin Media Finance PLC (United

 

 

 

Kingdom), 6.00%,

 

 

 

10/15/2024(b)

200,000

 

204,977

 

 

 

43,691,157

Interactive Media & Services–1.21%

 

 

Cable Onda S.A. (Panama), 4.50%,

 

 

 

01/30/2030(b)

200,000

 

203,870

Cumulus Media New Holdings, Inc.,

 

 

 

6.75%, 07/01/2026(b)

247,000

 

256,960

Diamond Sports Group LLC/Diamond

 

 

 

Sports Finance Co.,

 

 

 

5.38%, 08/15/2026(b)

4,738,000

 

4,377,410

6.63%, 08/15/2027(b)

339,000

 

275,217

Match Group, Inc., 5.63%,

 

 

 

02/15/2029(b)

5,513,000

 

5,838,805

Tencent Holdings Ltd. (China),

 

 

 

2.99%, 01/19/2023(b)

2,073,000

 

2,143,964

3.60%, 01/19/2028(b)

4,305,000

 

4,649,590

3.93%, 01/19/2038(b)

3,137,000

 

3,619,179

Twitter, Inc., 3.88%,

 

 

 

12/15/2027(b)

5,404,000

 

5,532,345

 

 

 

26,897,340

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

15

Invesco Corporate Bond Fund

 

Principal

 

 

 

Amount

 

Value

Internet & Direct Marketing Retail–0.88%

 

 

Alibaba Group Holding Ltd. (China),

 

 

 

4.20%, 12/06/2047

$ 2,190,000

$

2,653,157

4.40%, 12/06/2057

2,190,000

 

2,792,528

QVC, Inc.,

 

 

 

4.75%, 02/15/2027

1,869,000

 

1,841,822

5.45%, 08/15/2034

12,014,000

 

12,115,588

 

 

 

19,403,095

Investment Banking & Brokerage–1.77%

 

 

Cantor Fitzgerald L.P., 6.50%,

 

 

 

06/17/2022(b)

3,205,000

 

3,513,029

Charles Schwab Corp. (The), Series E,

 

 

 

4.63%(d)

4,560,000

 

4,624,114

Goldman Sachs Group, Inc. (The),

 

 

 

6.75%, 10/01/2037

4,675,000

 

6,705,332

4.80%, 07/08/2044

4,280,000

 

5,480,797

Series P, 5.00%(d)

3,255,000

 

3,200,511

Jefferies Group LLC/Jefferies Group

 

 

 

Capital Finance, Inc., 4.15%,

 

 

 

01/23/2030

3,874,000

 

4,203,119

Morgan Stanley,

 

 

 

4.35%, 09/08/2026

350,000

 

392,097

2.70%, 01/22/2031(c)

10,493,000

 

10,836,376

Raymond James Financial, Inc.,

 

 

 

4.95%, 07/15/2046

228,000

 

292,488

 

 

 

39,247,863

IT Consulting & Other Services–0.07%

 

 

DXC Technology Co., 4.45%,

 

 

 

09/18/2022

1,460,000

 

1,546,519

Leisure Facilities–0.03%

 

 

 

Cedar Fair L.P./Canada's Wonderland

 

 

 

Co./Magnum Management Corp.,

 

 

 

5.38%, 06/01/2024

247,000

 

252,042

Six Flags Entertainment Corp.,

 

 

 

4.88%, 07/31/2024(b)

352,000

 

348,158

 

 

 

600,200

Life & Health Insurance–2.52%

 

 

 

American Equity Investment Life

 

 

 

Holding Co., 5.00%,

 

 

 

06/15/2027

3,375,000

 

3,737,621

Athene Global Funding, 2.50%,

 

 

 

01/14/2025(b)

3,440,000

 

3,532,004

Athene Holding Ltd., 4.13%,

 

 

 

01/12/2028

7,130,000

 

7,595,838

Brighthouse Financial, Inc., 4.70%,

 

 

 

06/22/2047

6,627,000

 

6,715,529

Dai-ichi Life Insurance Co. Ltd. (The)

 

 

 

(Japan), 4.00%(b)(d)

3,060,000

 

3,253,805

Global Atlantic Fin Co., 4.40%,

 

 

 

10/15/2029(b)

10,195,000

 

10,791,468

MetLife, Inc.,

 

 

 

4.13%, 08/13/2042

2,400,000

 

2,874,677

Series C, 5.25%(d)

3,990,000

 

3,964,564

Series D, 5.88%(d)

300,000

 

334,745

Nationwide Financial Services, Inc.,

 

 

 

5.38%, 03/25/2021(b)

6,660,000

 

6,934,272

3.90%, 11/30/2049(b)

3,344,000

 

3,759,079

Prudential Financial, Inc., 3.91%,

 

 

 

12/07/2047

2,001,000

 

2,268,728

 

 

 

55,762,330

 

 

Principal

 

 

 

 

Amount

 

Value

Life Sciences Tools & Services–0.02%

 

 

Charles River Laboratories

 

 

 

 

International, Inc., 4.25%,

 

 

 

 

05/01/2028(b)

$

383,000

$

386,121

Managed Health Care–0.17%

 

 

 

 

Centene Corp.,

 

 

 

 

5.25%, 04/01/2025(b)

 

340,000

 

351,050

5.38%, 06/01/2026(b)

 

521,000

 

549,317

5.38%, 08/15/2026(b)

 

155,000

 

163,331

4.63%, 12/15/2029(b)

 

221,000

 

236,879

UnitedHealth Group, Inc., 3.75%,

 

 

 

 

07/15/2025

 

2,134,000

 

2,366,243

 

 

 

 

3,666,820

Marine Ports & Services–0.05%

 

 

 

 

Adani Abbot Point Terminal Pty. Ltd.

 

 

 

 

(Australia), 4.45%,

 

 

 

 

12/15/2022(b)

 

1,004,000

 

1,024,117

Metal & Glass Containers–0.25%

 

 

 

 

Ardagh Packaging Finance

 

 

 

 

PLC/Ardagh Holdings USA, Inc.,

 

 

 

 

6.00%, 02/15/2025(b)

 

200,000

 

209,000

Ball Corp., 5.25%, 07/01/2025

 

359,000

 

397,742

Berry Global, Inc.,

 

 

 

 

5.50%, 05/15/2022

 

144,000

 

145,079

6.00%, 10/15/2022

 

58,000

 

59,088

Flex Acquisition Co., Inc.,

 

 

 

 

6.88%, 01/15/2025(b)

 

195,000

 

190,127

7.88%, 07/15/2026(b)

 

252,000

 

256,365

OI European Group B.V., 4.00%,

 

 

 

 

03/15/2023(b)

 

73,000

 

74,034

Silgan Holdings, Inc., 4.13%,

 

 

 

 

02/01/2028(b)

 

4,279,000

 

4,300,395

 

 

 

 

5,631,830

Movies & Entertainment–0.17%

 

 

 

 

AMC Entertainment Holdings, Inc.,

 

 

 

 

5.75%, 06/15/2025

 

268,000

 

215,851

6.13%, 05/15/2027

 

285,000

 

228,720

Netflix, Inc.,

 

 

 

 

5.88%, 11/15/2028

 

1,110,000

 

1,250,027

5.38%, 11/15/2029(b)

 

1,927,000

 

2,098,599

 

 

 

 

3,793,197

Multi-line Insurance–0.73%

 

 

 

 

American International Group, Inc.,

 

 

 

 

4.50%, 07/16/2044

 

2,260,000

 

2,776,108

Fairfax Financial Holdings Ltd.

 

 

 

 

(Canada), 4.85%, 04/17/2028

 

3,010,000

 

3,382,186

Guardian Life Insurance Co. of

 

 

 

 

America (The), 3.70%,

 

 

 

 

01/22/2070(b)

 

3,061,000

 

3,466,516

Nationwide Mutual Insurance Co.,

 

 

 

 

4.95%, 04/22/2044(b)

 

3,210,000

 

4,210,674

XLIT Ltd. (Bermuda), 5.50%,

 

 

 

 

03/31/2045

 

1,670,000

 

2,392,361

 

 

 

 

16,227,845

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

16

Invesco Corporate Bond Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Multi-Utilities–0.41%

 

 

 

 

CenterPoint Energy, Inc.,

 

 

 

 

2.50%, 09/01/2024

$

3,210,000

$

3,316,744

Series A, 6.13%(d)

 

5,595,000

 

5,772,949

 

 

 

 

9,089,693

Office REITs–0.39%

 

 

 

 

Alexandria Real Estate Equities, Inc.,

 

 

 

 

3.95%, 01/15/2027

 

2,940,000

 

3,262,843

3.38%, 08/15/2031

 

1,848,000

 

2,052,299

4.00%, 02/01/2050

 

2,811,000

 

3,400,817

 

 

 

 

8,715,959

Office Services & Supplies–0.05%

 

 

 

Pitney Bowes, Inc., 5.20%,

 

 

 

 

04/01/2023

 

1,079,000

 

1,082,145

Oil & Gas Drilling–0.02%

 

 

 

 

Ensign Drilling, Inc. (Canada), 9.25%,

 

 

 

 

04/15/2024(b)

 

223,000

 

200,981

Precision Drilling Corp. (Canada),

 

 

 

 

5.25%, 11/15/2024

 

207,000

 

183,670

Transocean, Inc., 8.00%,

 

 

 

 

02/01/2027(b)

 

81,000

 

67,939

 

 

 

 

452,590

Oil & Gas Equipment & Services–0.17%

 

 

Baker Hughes, a GE Co. LLC/Baker

 

 

 

 

Hughes Co-Obligor, Inc., 3.34%,

 

 

 

 

12/15/2027

 

3,477,000

 

3,660,474

Hilcorp Energy I L.P./Hilcorp Finance

 

 

 

 

Co., 6.25%, 11/01/2028(b)

 

256,000

 

186,974

 

 

 

 

3,847,448

Oil & Gas Exploration & Production–1.95%

 

 

Antero Resources Corp., 5.63%,

 

 

 

 

06/01/2023

 

285,000

 

154,612

Ascent Resources Utica

 

 

 

 

Holdings LLC/ARU Finance Corp.,

 

 

 

 

10.00%, 04/01/2022(b)

 

177,000

 

151,284

Callon Petroleum Co.,

 

 

 

 

6.13%, 10/01/2024

 

231,000

 

183,645

6.38%, 07/01/2026

 

92,000

 

71,792

Cameron LNG LLC,

 

 

 

 

3.30%, 01/15/2035(b)

 

4,239,000

 

4,567,430

3.40%, 01/15/2038(b)

 

4,567,000

 

5,025,679

Concho Resources, Inc., 4.38%,

 

 

 

 

01/15/2025

 

6,682,000

 

6,899,574

Continental Resources, Inc., 5.00%,

 

 

 

 

09/15/2022

 

24,378,000

 

24,350,694

Genesis Energy L.P./Genesis Energy

 

 

 

 

Finance Corp.,

 

 

 

 

6.25%, 05/15/2026

 

255,000

 

213,651

7.75%, 02/01/2028

 

304,000

 

265,620

Gulfport Energy Corp.,

 

 

 

 

6.63%, 05/01/2023

 

423,000

 

222,206

6.00%, 10/15/2024

 

236,000

 

79,060

QEP Resources, Inc., 5.63%,

 

 

 

 

03/01/2026

 

480,000

 

385,212

Southwestern Energy Co.,

 

 

 

 

7.50%, 04/01/2026

 

190,000

 

145,355

7.75%, 10/01/2027

 

434,000

 

329,851

 

 

Principal

 

 

 

 

Amount

 

Value

Oil & Gas Exploration & Production–(continued)

 

 

Whiting Petroleum Corp.,

 

 

 

 

Conv., 1.25%, 04/01/2020

$

39,000

$

35,198

5.75%, 03/15/2021

 

241,000

 

139,117

6.63%, 01/15/2026

 

172,000

 

63,214

 

 

 

 

43,283,194

Oil & Gas Refining & Marketing–0.28%

 

 

Calumet Specialty Products Partners

 

 

 

 

L.P./Calumet Finance Corp.,

 

 

 

 

7.63%, 01/15/2022

 

347,000

 

344,185

EnLink Midstream Partners L.P.,

 

 

 

 

4.85%, 07/15/2026

 

371,000

 

318,531

5.60%, 04/01/2044

 

327,000

 

252,606

NuStar Logistics L.P., 6.00%,

 

 

 

 

06/01/2026

 

556,000

 

582,118

Parkland Fuel Corp. (Canada),

 

 

 

 

6.00%, 04/01/2026(b)

 

406,000

 

425,021

5.88%, 07/15/2027(b)

 

3,025,000

 

3,113,723

PBF Holding Co. LLC/PBF Finance

 

 

 

 

Corp., 6.00%, 02/15/2028(b)

 

317,000

 

313,830

Sunoco L.P./Sunoco Finance Corp.,

 

 

 

 

5.88%, 03/15/2028

 

723,000

 

741,326

 

 

 

 

6,091,340

Oil & Gas Storage & Transportation–9.07%

 

 

Antero Midstream Partners

 

 

 

 

L.P./Antero Midstream Finance

 

 

 

 

Corp., 5.38%, 09/15/2024

 

410,000

 

310,575

Cheniere Energy Partners L.P.,

 

 

 

 

5.63%, 10/01/2026

 

236,000

 

237,622

Crestwood Midstream Partners

 

 

 

 

L.P./Crestwood Midstream Finance

 

 

 

 

Corp., 5.75%, 04/01/2025

 

241,000

 

236,178

DCP Midstream Operating L.P.,

 

 

 

 

5.13%, 05/15/2029

 

394,000

 

387,834

Energy Transfer Operating L.P.,

 

 

 

 

5.88%, 01/15/2024

 

508,000

 

569,803

2.90%, 05/15/2025

 

4,349,000

 

4,441,503

3.75%, 05/15/2030

 

7,127,000

 

7,237,755

4.90%, 03/15/2035

 

8,695,000

 

9,386,911

5.00%, 05/15/2050

 

7,841,000

 

7,979,016

Series A, 6.25%(d)

 

515,000

 

460,026

Enterprise Products Operating LLC,

 

 

 

 

3.13%, 07/31/2029

 

3,900,000

 

4,085,990

2.80%, 01/31/2030

 

7,601,000

 

7,779,412

4.80%, 02/01/2049

 

2,369,000

 

2,767,199

4.20%, 01/31/2050

 

2,786,000

 

2,970,672

3.70%, 01/31/2051

 

15,335,000

 

15,354,783

3.95%, 01/31/2060

 

7,233,000

 

7,116,362

Series D,

 

 

 

 

6.88%, 03/01/2033

 

2,660,000

 

3,771,447

4.88%, 08/16/2077(c)

 

11,201,000

 

10,996,526

Hess Midstream Operations L.P.,

 

 

 

 

5.63%, 02/15/2026(b)

 

389,000

 

388,939

Holly Energy Partners L.P./Holly

 

 

 

 

Energy Finance Corp., 5.00%,

 

 

 

 

02/01/2028(b)

 

95,000

 

95,772

Kinder Morgan Energy Partners L.P.,

 

 

 

 

4.30%, 05/01/2024

 

2,383,000

 

2,586,281

Kinder Morgan, Inc.,

 

 

 

 

7.80%, 08/01/2031

 

9,500,000

 

13,357,533

7.75%, 01/15/2032

 

7,672,000

 

11,185,202

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

17

Invesco Corporate Bond Fund

 

Principal

 

 

 

Amount

 

Value

Oil & Gas Storage & Transportation–(continued)

 

 

MPLX L.P.,

 

 

 

2.79%, (3 mo. USD LIBOR +

 

 

 

0.90%), 09/09/2021(c)

$ 7,864,000

$

7,887,362

2.99%, (3 mo. USD LIBOR +

 

 

 

1.10%), 09/09/2022(c)

5,688,000

 

5,709,405

4.80%, 02/15/2029

2,355,000

 

2,640,560

4.70%, 04/15/2048

2,781,000

 

2,903,754

5.50%, 02/15/2049

3,731,000

 

4,197,431

NGL Energy Partners L.P./NGL Energy

 

 

 

Finance Corp., 7.50%,

 

 

 

04/15/2026

357,000

 

304,297

NGPL PipeCo. LLC, 7.77%,

 

 

 

12/15/2037(b)

7,250,000

 

9,408,624

Plains All American Pipeline L.P.,

 

 

 

Series B, 6.13%(d)

6,150,000

 

5,447,393

Plains All American Pipeline L.P./PAA

 

 

 

Finance Corp., 3.55%,

 

 

 

12/15/2029

13,704,000

 

13,509,292

Sabine Pass Liquefaction LLC,

 

 

 

5.75%, 05/15/2024

10,100,000

 

11,365,742

Targa Resources Partners L.P./Targa

 

 

 

Resources Partners Finance Corp.,

 

 

 

5.25%, 05/01/2023

2,445,000

 

2,444,230

5.13%, 02/01/2025

439,000

 

441,748

5.88%, 04/15/2026

677,000

 

698,646

5.00%, 01/15/2028

201,000

 

198,894

5.50%, 03/01/2030(b)

63,000

 

62,430

Western Midstream Operating L.P.,

 

 

 

4.00%, 07/01/2022

2,910,000

 

2,981,394

2.70%, (3 mo. USD LIBOR +

 

 

 

0.85%), 01/13/2023(c)

3,960,000

 

3,946,179

3.10%, 02/01/2025

2,149,000

 

2,149,991

Williams Cos., Inc. (The),

 

 

 

4.13%, 11/15/2020

6,204,000

 

6,267,995

7.88%, 09/01/2021

140,000

 

153,267

3.60%, 03/15/2022

3,670,000

 

3,788,301

4.55%, 06/24/2024

399,000

 

437,412

3.75%, 06/15/2027

250,000

 

262,421

 

 

 

200,910,109

Other Diversified Financial Services–0.76%

 

 

Carlyle Finance LLC, 5.65%,

 

 

 

09/15/2048(b)

11,281,000

 

14,757,548

eG Global Finance PLC (Netherlands),

 

 

 

6.75%, 02/07/2025(b)

259,000

 

253,712

Football Trust V, 5.35%,

 

 

 

10/05/2020(b)

450,270

 

460,128

ILFC E-Capital Trust II, 4.15%,

 

 

 

12/21/2065(b)(c)

620,000

 

507,430

Lions Gate Capital Holdings LLC,

 

 

 

6.38%, 02/01/2024(b)

242,000

 

237,763

LPL Holdings, Inc., 5.75%,

 

 

 

09/15/2025(b)

241,000

 

250,638

Tempo Acquisition LLC/Tempo

 

 

 

Acquisition Finance Corp., 6.75%,

 

 

 

06/01/2025(b)

378,000

 

377,172

 

 

 

16,844,391

Packaged Foods & Meats–0.40%

 

 

 

B&G Foods, Inc.,

 

 

 

5.25%, 04/01/2025

237,000

 

234,529

5.25%, 09/15/2027

96,000

 

95,160

 

Principal

 

 

 

Amount

 

Value

Packaged Foods & Meats–(continued)

 

 

Conagra Brands, Inc., 5.30%,

 

 

 

11/01/2038

$ 300,000

$

364,520

Hershey Co. (The), 3.13%,

 

 

 

11/15/2049

2,833,000

 

3,059,504

JBS USA LUX S.A./JBS USA Food

 

 

 

Co./JBS USA Finance, Inc.,

 

 

 

5.50%, 01/15/2030(b)

217,000

 

229,404

Kraft Heinz Foods Co.,

 

 

 

6.88%, 01/26/2039

249,000

 

297,925

5.00%, 06/04/2042

235,000

 

236,345

Lamb Weston Holdings, Inc., 4.63%,

 

 

 

11/01/2024(b)

186,000

 

193,982

Mars, Inc., 2.70%, 04/01/2025(b)

3,334,000

 

3,525,695

Pilgrim's Pride Corp., 5.88%,

 

 

 

09/30/2027(b)

398,000

 

413,184

TreeHouse Foods, Inc., 6.00%,

 

 

 

02/15/2024(b)

223,000

 

230,713

 

 

 

8,880,961

Paper Packaging–0.13%

 

 

 

Cascades, Inc./Cascades USA, Inc.

 

 

 

(Canada), 5.38%, 01/15/2028(b)

2,547,000

 

2,629,778

Trivium Packaging Finance B.V.

 

 

 

(Netherlands), 5.50%,

 

 

 

08/15/2026(b)

200,000

 

207,625

 

 

 

2,837,403

Paper Products–0.16%

 

 

 

Mercer International, Inc. (Germany),

 

 

 

6.50%, 02/01/2024

157,000

 

161,186

5.50%, 01/15/2026

88,000

 

83,224

Schweitzer-Mauduit International,

 

 

 

Inc., 6.88%, 10/01/2026(b)

485,000

 

521,544

Suzano Austria GmbH (Brazil),

 

 

 

6.00%, 01/15/2029

2,408,000

 

2,701,902

 

 

 

3,467,856

Pharmaceuticals–1.74%

 

 

 

Bausch Health Cos., Inc.,

 

 

 

6.13%, 04/15/2025(b)

188,000

 

192,152

5.50%, 11/01/2025(b)

177,000

 

182,605

9.00%, 12/15/2025(b)

202,000

 

225,424

Bayer US Finance II LLC (Germany),

 

 

 

2.58%, (3 mo. USD LIBOR +

 

 

 

0.63%), 06/25/2021(b)(c)

2,759,000

 

2,765,310

2.90%, (3 mo. USD LIBOR +

 

 

 

1.01%), 12/15/2023(b)(c)

5,955,000

 

5,972,082

3.88%, 12/15/2023(b)

1,964,000

 

2,109,611

Bristol-Myers Squibb Co.,

 

 

 

2.90%, 07/26/2024(b)

8,373,000

 

8,828,239

3.20%, 06/15/2026(b)

3,106,000

 

3,392,924

3.40%, 07/26/2029(b)

300,000

 

336,331

4.25%, 10/26/2049(b)

3,196,000

 

4,117,234

Endo Dac/Endo Finance LLC/Endo

 

 

 

Finco, Inc., 6.00%,

 

 

 

07/15/2023(b)

200,000

 

157,502

GlaxoSmithKline Capital PLC (United

 

 

 

Kingdom), 2.88%, 06/01/2022

4,053,000

 

4,173,313

HLF Financing S.a.r.l. LLC/Herbalife

 

 

 

International, Inc., 7.25%,

 

 

 

08/15/2026(b)

245,000

 

247,756

Par Pharmaceutical, Inc., 7.50%,

 

 

 

04/01/2027(b)

205,000

 

216,998

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

18

Invesco Corporate Bond Fund

 

Principal

 

 

 

Amount

 

Value

Pharmaceuticals–(continued)

 

 

 

Pfizer, Inc., 2.95%, 03/15/2024

$ 5,274,000

$

5,599,506

 

 

 

38,516,987

Property & Casualty Insurance–0.09%

 

 

Allstate Corp. (The), 4.20%,

 

 

 

12/15/2046

1,505,000

 

1,932,153

AmWINS Group, Inc., 7.75%,

 

 

 

07/01/2026(b)

107,000

 

111,385

 

 

 

2,043,538

Publishing–0.01%

 

 

 

Meredith Corp., 6.88%,

 

 

 

02/01/2026

322,000

 

323,786

Railroads–1.93%

 

 

 

Canadian Pacific Railway Co.

 

 

 

(Canada), 6.13%, 09/15/2115

11,960,000

 

19,428,475

CSX Corp., 4.65%, 03/01/2068

3,463,000

 

4,251,152

Kenan Advantage Group, Inc. (The),

 

 

 

7.88%, 07/31/2023(b)

408,000

 

403,069

Norfolk Southern Corp.,

 

 

 

2.55%, 11/01/2029

2,799,000

 

2,913,525

3.40%, 11/01/2049

3,568,000

 

3,791,931

Union Pacific Corp.,

 

 

 

2.15%, 02/05/2027

3,779,000

 

3,856,411

2.40%, 02/05/2030

4,719,000

 

4,843,112

3.95%, 08/15/2059

2,888,000

 

3,256,905

 

 

 

42,744,580

Regional Banks–1.69%

 

 

 

CIT Group, Inc., 5.00%,

 

 

 

08/01/2023

311,000

 

332,641

Citizens Financial Group, Inc.,

 

 

 

2.38%, 07/28/2021

5,719,000

 

5,776,540

2.50%, 02/06/2030

3,653,000

 

3,709,608

Series A, 5.50%(d)

1,100,000

 

1,094,726

Fifth Third Bancorp,

 

 

 

4.30%, 01/16/2024

2,730,000

 

2,963,699

2.38%, 01/28/2025

7,685,000

 

7,915,338

First Niagara Financial Group, Inc.,

 

 

 

7.25%, 12/15/2021

1,300,000

 

1,424,100

KeyCorp, 2.25%, 04/06/2027

5,309,000

 

5,370,078

M&T Bank Corp., Series F, 5.13%(d)

1,366,000

 

1,466,176

Synovus Financial Corp., 3.13%,

 

 

 

11/01/2022

2,457,000

 

2,522,491

Zions Bancorporation N.A., 3.25%,

 

 

 

10/29/2029

4,640,000

 

4,866,777

 

 

 

37,442,174

Research & Consulting Services–0.00%

 

 

Dun & Bradstreet Corp. (The),

 

 

 

10.25%, 02/15/2027(b)

57,000

 

64,088

Residential REITs–0.52%

 

 

 

Essex Portfolio L.P., 3.63%,

 

 

 

08/15/2022

3,600,000

 

3,766,758

Spirit Realty L.P.,

 

 

 

4.00%, 07/15/2029

1,790,000

 

2,004,827

3.40%, 01/15/2030

5,305,000

 

5,666,617

 

 

 

11,438,202

 

 

Principal

 

 

 

 

Amount

 

Value

Restaurants–0.38%

 

 

 

 

1011778 BC ULC/New Red Finance,

 

 

 

 

Inc. (Canada), 5.00%,

 

 

 

 

10/15/2025(b)

$

489,000

$

492,259

Aramark Services, Inc., 5.00%,

 

 

 

 

04/01/2025(b)

 

215,000

 

222,523

IRB Holding Corp., 6.75%,

 

 

 

 

02/15/2026(b)

 

239,000

 

237,888

Starbucks Corp., 4.45%,

 

 

 

 

08/15/2049

 

6,077,000

 

7,349,868

 

 

 

 

8,302,538

Retail REITs–0.12%

 

 

 

 

Regency Centers L.P., 4.13%,

 

 

 

 

03/15/2028

 

2,396,000

 

2,716,172

Security & Alarm Services–0.02%

 

 

 

Brink's Co. (The), 4.63%,

 

 

 

 

10/15/2027(b)

 

201,000

 

206,492

Prime Security Services

 

 

 

 

Borrower LLC/Prime Finance, Inc.,

 

 

 

 

5.75%, 04/15/2026(b)

 

240,000

 

250,050

 

 

 

 

456,542

Semiconductor Equipment–0.00%

 

 

 

Lam Research Corp., 3.75%,

 

 

 

 

03/15/2026

 

50,000

 

55,190

Semiconductors–1.88%

 

 

 

 

Analog Devices, Inc., 3.13%,

 

 

 

 

12/05/2023

 

2,420,000

 

2,557,521

Broadcom Corp./Broadcom Cayman

 

 

 

 

Finance Ltd.,

 

 

 

 

3.00%, 01/15/2022

 

8,505,000

 

8,674,678

3.88%, 01/15/2027

 

5,965,000

 

6,260,272

3.50%, 01/15/2028

 

7,101,000

 

7,338,559

Micron Technology, Inc.,

 

 

 

 

4.98%, 02/06/2026

 

2,035,000

 

2,276,187

4.19%, 02/15/2027

 

6,500,000

 

6,965,072

NXP B.V./NXP Funding LLC

 

 

 

 

(Netherlands), 3.88%,

 

 

 

 

09/01/2022(b)

 

7,160,000

 

7,513,390

 

 

 

 

41,585,679

Soft Drinks–0.32%

 

 

 

 

Fomento Economico Mexicano S.A.B.

 

 

 

 

de C.V. (Mexico), 3.50%,

 

 

 

 

01/16/2050

 

6,480,000

 

6,879,507

Keurig Dr Pepper, Inc., 4.60%,

 

 

 

 

05/25/2028

 

250,000

 

288,636

 

 

 

 

7,168,143

Sovereign Debt–0.84%

 

 

 

 

Banque Ouest Africaine de

 

 

 

 

Developpement (Supranational),

 

 

 

 

5.00%, 07/27/2027(b)

 

8,000,000

 

8,691,920

Oman Government International Bond

 

 

 

 

(Oman), 4.13%, 01/17/2023(b)

 

2,929,000

 

2,957,576

Saudi Government International Bond

 

 

 

 

(Saudi Arabia), 3.75%,

 

 

 

 

01/21/2055(b)

 

6,865,000

 

6,976,556

 

 

 

 

18,626,052

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

19

Invesco Corporate Bond Fund

 

Principal

 

 

 

Amount

 

Value

Specialized Consumer Services–0.04%

 

 

ServiceMaster Co. LLC (The),

 

 

 

5.13%, 11/15/2024(b)

$ 235,000

$

242,834

7.45%, 08/15/2027

463,000

 

531,453

 

 

 

774,287

Specialized Finance–0.27%

 

 

 

National Rural Utilities Cooperative

 

 

 

Finance Corp., 2.40%,

 

 

 

03/15/2030

5,840,000

 

6,066,998

Specialized REITs–0.18%

 

 

 

Equinix, Inc.,

 

 

 

5.88%, 01/15/2026

723,000

 

765,462

3.20%, 11/18/2029

120,000

 

125,818

GLP Capital L.P./GLP Financing II,

 

 

 

Inc., 5.38%, 04/15/2026

247,000

 

279,266

Iron Mountain US Holdings, Inc.,

 

 

 

5.38%, 06/01/2026(b)

343,000

 

355,982

Iron Mountain, Inc.,

 

 

 

6.00%, 08/15/2023

182,000

 

185,565

5.75%, 08/15/2024

84,000

 

84,839

5.25%, 03/15/2028(b)

456,000

 

472,940

4.88%, 09/15/2029(b)

991,000

 

984,402

Rayonier A.M. Products, Inc., 5.50%,

 

 

 

06/01/2024(b)

409,000

 

235,091

SBA Communications Corp., 4.88%,

 

 

 

09/01/2024

507,000

 

522,106

 

 

 

4,011,471

Specialty Chemicals–0.28%

 

 

 

Ashland LLC, 4.75%, 08/15/2022

20,000

 

20,850

Braskem Idesa S.A.P.I. (Mexico),

 

 

 

7.45%, 11/15/2029(b)

4,585,000

 

4,592,978

Element Solutions, Inc., 5.88%,

 

 

 

12/01/2025(b)

232,000

 

233,742

GCP Applied Technologies, Inc.,

 

 

 

5.50%, 04/15/2026(b)

349,000

 

363,954

PolyOne Corp., 5.25%,

 

 

 

03/15/2023

219,000

 

233,780

PQ Corp., 6.75%, 11/15/2022(b)

195,000

 

199,630

Sherwin-Williams Co. (The), 2.95%,

 

 

 

08/15/2029

491,000

 

517,758

 

 

 

6,162,692

Steel–1.12%

 

 

 

POSCO (South Korea),

 

 

 

2.38%, 01/17/2023(b)

18,285,000

 

18,585,775

2.50%, 01/17/2025(b)

6,160,000

 

6,245,869

 

 

 

24,831,644

Systems Software–0.12%

 

 

 

Camelot Finance S.A., 4.50%,

 

 

 

11/01/2026(b)

107,000

 

107,725

Microsoft Corp., 4.25%,

 

 

 

02/06/2047

1,868,000

 

2,464,659

 

 

 

2,572,384

Technology Distributors–0.11%

 

 

 

Avnet, Inc., 4.63%, 04/15/2026

2,250,000

 

2,458,227

CDW LLC/CDW Finance Corp., 5.00%,

 

 

 

09/01/2025

80,000

 

82,591

 

 

 

2,540,818

 

Principal

 

 

 

Amount

 

Value

Technology Hardware, Storage & Peripherals–0.97%

 

Apple, Inc., 2.05%, 09/11/2026

$ 3,868,000

$

3,969,667

Dell International LLC/EMC Corp.,

 

 

 

7.13%, 06/15/2024(b)

708,000

 

741,630

4.00%, 07/15/2024(b)

3,160,000

 

3,387,022

6.02%, 06/15/2026(b)

4,252,000

 

4,983,104

4.90%, 10/01/2026(b)

1,860,000

 

2,087,870

8.10%, 07/15/2036(b)

249,000

 

342,242

8.35%, 07/15/2046(b)

4,426,000

 

6,021,170

 

 

 

21,532,705

Textiles–0.01%

 

 

 

Eagle Intermediate Global Holding

 

 

 

B.V./Ruyi US Finance LLC (China),

 

 

 

7.50%, 05/01/2025(b)

214,000

 

150,424

Thrifts & Mortgage Finance–0.00%

 

 

Nationstar Mortgage Holdings, Inc.,

 

 

 

6.00%, 01/15/2027(b)

67,000

 

68,190

Tobacco–1.33%

 

 

 

Altria Group, Inc.,

 

 

 

3.80%, 02/14/2024

4,363,000

 

4,687,734

4.40%, 02/14/2026

7,026,000

 

7,874,519

4.80%, 02/14/2029

5,300,000

 

6,067,549

6.20%, 02/14/2059

2,066,000

 

2,709,932

BAT Capital Corp. (United Kingdom),

 

 

 

2.79%, 09/06/2024

4,677,000

 

4,812,121

4.76%, 09/06/2049

2,996,000

 

3,233,519

 

 

 

29,385,374

Trading Companies & Distributors–1.52%

 

 

AerCap Global Aviation Trust

 

 

 

(Ireland), 6.50%,

 

 

 

06/15/2045(b)(c)

11,026,000

 

11,881,618

AerCap Ireland Capital DAC/AerCap

 

 

 

Global Aviation Trust (Ireland),

 

 

 

3.50%, 05/26/2022

1,798,000

 

1,849,056

Air Lease Corp.,

 

 

 

3.88%, 04/01/2021

3,660,000

 

3,749,276

3.38%, 06/01/2021

3,865,000

 

3,946,856

3.00%, 09/15/2023

1,965,000

 

2,025,562

2.30%, 02/01/2025

300,000

 

300,418

Aircastle Ltd.,

 

 

 

7.63%, 04/15/2020

71,000

 

71,451

5.00%, 04/01/2023

534,000

 

581,555

4.40%, 09/25/2023

4,000,000

 

4,265,077

BMC East LLC, 5.50%,

 

 

 

10/01/2024(b)

370,000

 

382,178

BOC Aviation Ltd. (Singapore),

 

 

 

3.07% (3 mo. USD LIBOR +

 

 

 

1.13%), 09/26/2023(b)(c)

2,446,000

 

2,459,123

Herc Holdings, Inc., 5.50%,

 

 

 

07/15/2027(b)

245,000

 

254,782

United Rentals North America, Inc.,

 

 

 

5.50%, 07/15/2025

192,000

 

198,320

5.88%, 09/15/2026

704,000

 

742,702

6.50%, 12/15/2026

327,000

 

349,285

5.50%, 05/15/2027

129,000

 

135,131

5.25%, 01/15/2030

343,000

 

361,470

 

 

 

33,553,860

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

20

Invesco Corporate Bond Fund

 

Principal

 

 

 

Amount

 

Value

Trucking–1.53%

 

 

 

Aviation Capital Group LLC,

 

 

 

2.44%, (3 mo. USD LIBOR +

 

 

 

0.67%), 07/30/2021(b)(c)

$ 1,914,000

$

1,921,391

4.13%, 08/01/2025(b)

5,593,000

 

5,992,329

3.50%, 11/01/2027(b)

15,922,000

 

16,527,841

Avis Budget Car Rental LLC/Avis Budget

 

 

 

Finance, Inc.,

 

 

 

5.25%, 03/15/2025(b)

273,000

 

275,953

5.75%, 07/15/2027(b)

1,877,000

 

1,881,739

DAE Funding LLC (United Arab

 

 

 

Emirates), 4.00%,

 

 

 

08/01/2020(b)

2,872,000

 

2,883,883

Penske Truck Leasing Co. L.P./PTL

 

 

 

Finance Corp.,

 

 

 

3.90%, 02/01/2024(b)

3,433,000

 

3,699,335

3.40%, 11/15/2026(b)

405,000

 

428,384

Ryder System, Inc., 2.90%,

 

 

 

12/01/2026

303,000

 

320,786

 

 

 

33,931,641

Wireless Telecommunication Services–2.25%

 

 

Digicel Group One Ltd. (Jamaica),

 

 

 

8.25%, 12/30/2022(b)

109,000

 

70,339

Digicel Group Two Ltd. (Jamaica),

 

 

 

8.25%, 09/30/2022(b)

104,000

 

25,300

Intelsat Jackson Holdings S.A.

 

 

 

(Luxembourg), 8.50%,

 

 

 

10/15/2024(b)

265,000

 

232,428

Oztel Holdings SPC Ltd. (Oman),

 

 

 

5.63%, 10/24/2023(b)

1,473,000

 

1,550,221

Rogers Communications, Inc. (Canada),

 

 

 

4.50%, 03/15/2043

330,000

 

392,274

5.00%, 03/15/2044

4,835,000

 

6,248,544

4.35%, 05/01/2049

870,000

 

1,039,564

Sprint Spectrum Co. LLC/Sprint Spectrum

 

 

 

Co. II LLC/Sprint Spectrum Co. III LLC,

 

 

 

Class A-1, 3.36%,

 

 

 

09/20/2021(b)

8,225,438

 

8,302,345

4.74%, 03/20/2025(b)

11,472,000

 

12,307,907

5.15%, 03/20/2028(b)

11,487,000

 

12,961,959

VEON Holdings B.V. (Netherlands),

 

 

 

4.00%, 04/09/2025(b)

6,366,000

 

6,541,065

Ypso Finance Bis S.A. (Luxembourg),

 

 

 

10.50%, 05/15/2027(b)

210,000

 

238,875

 

 

 

49,910,821

Total U.S. Dollar Denominated Bonds & Notes

 

 

(Cost $1,808,670,406)

 

 

1,937,711,759

U.S. Treasury Securities–4.84%

 

 

U.S. Treasury Bills–0.22%

 

 

 

1.50% - 1.52%,

 

 

 

04/09/2020(e)(f)

4,860,000

 

4,852,005

U.S. Treasury Bonds–2.35%

 

 

 

2.38%, 11/15/2049

44,509,700

 

51,971,160

U.S. Treasury Notes–2.27%

 

 

 

1.38%, 01/31/2025

24,923,000

 

25,469,164

1.50%, 01/31/2027

7,947,800

 

8,189,339

1.50%, 02/15/2030

16,068,000

 

16,617,827

 

 

 

50,276,330

Total U.S. Treasury Securities

 

 

 

(Cost $102,288,623)

 

 

107,099,495

 

 

 

Shares

 

Value

 

Preferred Stocks–1.63%

 

 

 

 

Diversified Banks–1.00%

 

 

 

 

Bank of America Corp., 7.25%, Series L,

 

 

 

 

Conv. Pfd.

 

100

$

150,000

Wells Fargo & Co., 7.50%, Class A,

 

 

 

 

 

Series L, Conv. Pfd.

 

14,554

 

21,903,770

 

 

 

 

 

22,053,770

Investment Banking & Brokerage–0.52%

 

 

Morgan Stanley, 7.13%, Series E, Pfd.

265,000

 

7,356,400

Morgan Stanley, 6.88%, Series F, Pfd.

150,000

 

4,135,500

 

 

 

 

 

11,491,900

Regional Banks–0.11%

 

 

 

 

PNC Financial Services Group, Inc. (The),

 

 

 

 

6.13%, Series P, Pfd.

 

95,000

 

2,526,050

 

Total Preferred Stocks (Cost $31,500,112)

 

36,071,720

 

 

 

Principal

 

 

 

 

 

Amount

 

 

Asset-Backed Securities–1.28%

 

 

Hertz Vehicle Financing II L.P.,

 

 

 

 

 

Series 2016-2A, Class B, 3.94%,

 

 

 

 

 

03/25/2022(b)

 

$ 7,500,000

 

7,649,156

Jimmy Johns Funding LLC,

 

 

 

 

 

Series 2017-1A, Class A2II,

 

 

 

 

 

4.85%, 07/30/2047(b)

 

4,265,722

 

4,658,998

Sonic Capital LLC, Series 2020-1A,

 

 

 

 

 

Class A2I, 3.85%,

 

 

 

 

 

01/20/2050(b)

 

10,971,000

 

11,383,123

Wendy's Funding LLC,

 

 

 

 

 

Series 2018-1A, Class A2II,

 

 

 

 

 

3.88%, 03/15/2048(b)

 

4,459,000

 

4,722,661

 

Total Asset-Backed Securities

 

 

 

 

 

(Cost $27,493,625)

 

 

 

28,413,938

Variable Rate Senior Loan Interests–0.56%(g)

 

Diversified REITs–0.56%

 

 

 

 

Asterix, Inc. (Canada), Term Loan,

 

 

 

 

3.90%, 03/31/2023

 

 

 

 

 

(Cost $12,427,138)(h)

 

16,616,326

 

12,379,457

Non-U.S. Dollar Denominated Bonds & Notes–0.51%(i)

Diversified Banks–0.01%

 

 

 

 

Erste Group Bank AG (Austria),

 

 

 

 

 

6.50%(b)(d)

EUR

200,000

 

250,343

Food Retail–0.01%

 

 

 

 

Iceland Bondco PLC (United Kingdom),

 

 

 

 

4.63%, 03/15/2025(b)

GBP

200,000

 

201,818

Quatrim S.A.S.U. (France), 5.88%,

 

 

 

 

 

01/15/2024(b)

EUR

100,000

 

111,361

 

 

 

 

 

313,179

Integrated Telecommunication Services–0.22%

 

 

AT&T, Inc., Series B, 2.88%(c)(d)

EUR

4,400,000

 

4,777,234

Movies & Entertainment–0.14%

 

 

 

Netflix, Inc., 3.88%, 11/15/2029(b) EUR

2,600,000

 

3,018,448

Sovereign Debt–0.13%

 

 

 

 

Ukraine Government International

 

 

 

 

 

Bond (Ukraine), 4.38%,

 

 

 

 

 

01/27/2030(b)

EUR

2,765,000

 

2,890,332

 

Total Non-U.S. Dollar Denominated Bonds & Notes

 

 

 

(Cost $11,380,106)

 

 

 

11,249,536

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

21

Invesco Corporate Bond Fund

 

 

 

Principal

 

 

 

 

 

Amount

 

Value

Municipal Obligations–0.25%

 

 

 

 

Florida Development Finance Corp. (Palm

 

 

 

 

Bay Academy, Inc.),

 

 

 

 

Series 2017, Ref. RB, 9.00%,

 

 

 

 

05/15/2024(b)

$

735,000

$

749,200

Series 2017, Ref. RB, 0.00%,

 

 

 

 

05/15/2037(b)(h)(j)

 

360,000

 

3,600

Series 2017, Ref. RB, 0.00%,

 

 

 

 

05/15/2037(b)(h)(j)

 

350,000

 

230,730

Grand Parkway Transportation Corp.,

 

 

 

 

Series 2020, Ref. RB, 3.24%,

 

 

 

 

10/01/2052

 

4,465,000

 

4,552,425

 

Total Municipal Obligations (Cost $5,515,448)

 

5,535,955

 

 

 

Shares

 

 

Common Stocks & Other Equity Interests–0.00%

Diversified Support Services–0.00%

 

 

ACC Claims Holdings LLC(h)(k)

 

727,470

 

1

Other Diversified Financial Services–0.00%

 

 

Adelphia Recovery Trust, Series ACC1(k)(l)

 

859,558

 

1,633

 

Total Common Stocks & Other Equity Interests

 

 

 

(Cost $218,117)

 

 

 

1,634

Investment Abbreviations:

 

 

 

 

Conv. – Convertible

 

 

 

 

DAC

– Designated Activity Co.

 

 

 

 

EUR

– Euro

 

 

 

 

GBP

– British Pound Sterling

 

 

 

 

LIBOR – London Interbank Offered Rate

 

 

 

 

Pfd.

– Preferred

 

 

 

 

RB

– Revenue Bonds

 

 

 

 

Ref.

– Refunding

 

 

 

 

REIT

– Real Estate Investment Trust

 

 

 

 

SOFR

– Secured Overnight Financing Rate

 

 

 

 

USD

– U.S. Dollar

 

 

 

 

Notes to Schedule of Investments:

 

 

Shares

 

Value

 

Money Market Funds–2.90%

 

 

 

Invesco Government & Agency Portfolio,

 

 

 

 

Institutional Class, 1.50%(m)

23,166,315

$

23,166,314

Invesco Liquid Assets Portfolio,

 

 

 

 

Institutional Class, 1.64%(m)

14,686,555

 

14,693,899

Invesco Treasury Portfolio, Institutional

 

 

 

 

Class, 1.48%(m)

26,475,788

 

26,475,788

 

Total Money Market Funds (Cost $64,334,592)

 

64,336,001

Options Purchased–0.04%

 

 

 

 

(Cost $1,185,847)(n)

 

 

888,558

TOTAL INVESTMENTS IN SECURITIES–99.52%

 

 

 

(Cost $2,065,014,014)

 

 

2,203,688,053

OTHER ASSETS LESS LIABILITIES—0.48%

 

 

10,639,296

NET ASSETS–100.00%

 

$2,214,327,349

(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)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 February 29, 2020 was $724,347,604, which represented 32.71% of the Fund's Net Assets.

(c)Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on February 29, 2020.

(d)Perpetual bond with no specified maturity date.

(e)All or a portion of the value was pledged and/or designated as collateral to cover margin requirements for open futures contracts and swap agreements. See Note 1K and Note 1M.

(f)Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund.

(g)Variable rate senior loan interests are, at present, not readily marketable, not registered under the 1933 Act and may be subject to contractual and legal restrictions on sale. Variable rate senior loan interests in the Fund's portfolio generally have variable rates which adjust to a base, such as the London Interbank Offered Rate ("LIBOR"), on set dates, typically every 30 days, but not greater than one year, and/or have interest rates that float at margin above a widely recognized base lending rate such as the Prime Rate of a designated U.S. bank.

(h)Security valued using significant unobservable inputs (Level 3). See Note 3.

(i)Foreign denominated security. Principal amount is denominated in the currency indicated.

(j)Zero coupon bond issued at a discount.

(k)Non-income producing security.

(l)Non-income producing security acquired as part of the Adelphia Communications bankruptcy reorganization.

(m)The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of February 29, 2020.

(n)The table below details options purchased.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

22

Invesco Corporate Bond Fund

Open Exchange-Traded Equity Options Purchased

 

 

Type of

Expiration

Number of

Exercise

 

Notional

 

Description

 

Contract

Date

Contracts

Price

 

 

Value*

Value

Equity Risk

 

 

 

 

 

 

 

 

 

Amazon.com, Inc.

 

Call

06/18/2021

1

$2,200.00

$

220,000

$ 14,787

Apple, Inc.

 

Call

01/15/2021

16

340.00

 

544,000

16,560

 

 

 

 

 

 

 

 

 

Booking Holdings, Inc.

 

Call

01/15/2021

2

2,100.00

 

420,000

15,790

 

 

 

 

 

 

 

 

 

Consumer Discretionary Select Sector SPDR Fund

 

Call

06/18/2021

20

135.00

 

270,000

7,000

Health Care Select Sector SPDR Fund Option

 

Call

01/15/2021

25

104.00

 

260,000

6,250

Health Care Select Sector SPDR Fund Option

 

Call

01/15/2021

25

106.00

 

265,000

6,063

 

 

 

 

 

 

 

 

 

Industrial Select Sector SPDR Fund

 

Call

01/15/2021

20

85.00

 

170,000

5,000

Intel Corp. Option

 

Call

01/15/2021

48

72.50

 

348,000

8,520

JPMorgan Chase & Co.

 

Call

01/15/2021

15

135.00

 

202,500

7,275

 

 

 

 

 

 

 

 

 

Microsoft Corp.

 

Call

03/19/2021

24

190.00

 

456,000

24,120

Oracle Corp.

 

Call

01/15/2021

27

62.50

 

168,750

3,105

QUALCOMM, Inc.

 

Call

01/15/2021

2

97.50

 

19,500

783

 

 

 

 

 

 

 

 

 

UnitedHealth Group, Inc.

 

Call

01/15/2021

8

290.00

 

232,000

13,280

 

 

 

 

 

 

 

 

 

Verizon Communications, Inc.

 

Call

01/15/2021

30

60.00

 

180,000

5,805

Total Open Exchange-Traded Equity Options Purchased

 

 

263

 

 

 

 

$134,338

 

 

 

 

 

 

* Notional Value is calculated by multiplying the Number of Contracts by the Exercise Price by the multiplier.

 

 

 

 

 

 

Open Exchange-Traded Index Options Purchased

 

 

 

 

 

 

Type of

Expiration

Number of

Exercise

 

Notional

 

Description

 

Contract

Date

Contracts

Price

 

 

Value*

Value

Equity Risk

 

 

 

 

 

 

 

 

 

S&P 500 Index

 

Call

06/18/2021

43

$3,100.00

$13,330,000

$754,220

 

 

 

 

 

 

* Notional Value is calculated by multiplying the Number of Contracts by the Exercise Price by the multiplier.

 

 

 

 

 

 

Open Exchange-Traded Equity Options Written

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized

 

Type of

Expiration

Number of

Exercise

Premiums

Notional

 

Appreciation

Description

Contract

Date

Contracts

Price

Received

Value*

Value

(Depreciation)

Equity Risk

 

 

 

 

 

 

 

 

 

Booking Holdings, Inc.

Call

01/15/2021

2

$2,400.00

$(15,194)

$480,000

$ (5,810)

$ 9,384

 

 

 

 

 

 

 

 

 

Health Care Select Sector SPDR Fund

Call

01/15/2021

25

103.33

(17,549)

258,325

(7,125)

10,424

 

 

 

 

 

 

 

 

 

 

Oracle Corp.

Call

01/15/2021

12

70.00

(1,643)

 

84,000

(522)

1,121

QUALCOMM, Inc.

Call

01/15/2021

1

110.00

(267)

 

11,000

(223)

44

UnitedHealth Group, Inc.

Call

01/15/2021

3

300.00

(3,006)

 

90,000

(4,080)

(1,074)

 

 

 

 

 

 

 

 

 

 

Total Exchange-Traded Equity Options Written

 

 

 

 

$(37,659)

 

 

$(17,760)

$19,899

*Notional Value is calculated by multiplying the Number of Contracts by the Exercise Price by the multiplier.

Open Over-The-Counter Credit Default Swaptions Written

 

 

 

 

(Pay)/

 

 

 

 

 

 

 

 

 

 

 

Receive

 

 

Implied

 

 

 

 

 

Type of

Exercise

Reference

Fixed

Payment

Expiration

Credit

Premiums

Notional

 

Unrealized

Counterparty

Contract

Rate

Entity

Rate

Frequency

Date

Spread

Received

Value

Value

(Depreciation)

Credit Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Markit CDX North

 

 

 

 

 

 

 

 

Morgan Stanley and

 

 

America High Yield

 

 

 

 

 

 

 

 

Co. International

 

 

Index, Series 33,

 

 

 

 

 

 

 

 

PLC

Buy

106.00%

Version 2

3MonthUSDLIBOR% Quarterly

03/18/2020

3.769

$(218,804)

$(55,953,000)

$(869,157)

$(650,353)

LIBOR London Interbank Offered Rate

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

23

Invesco Corporate Bond Fund

Open Futures Contracts

 

 

 

 

 

 

 

 

 

 

 

Unrealized

Long Futures Contracts

 

 

 

Number of

Expiration

Notional

 

 

Appreciation

 

 

 

Contracts

Month

Value

 

 

Value

(Depreciation)

Interest Rate Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury 2 Year Notes

 

 

 

948

June-2020

$ 206,975,063

$ 1,257,196

$ 1,257,196

 

U.S. Treasury 10 Year Notes

 

 

 

681

June-2020

91,764,750

1,239,275

1,239,275

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury Long Bonds

 

 

 

585

June-2020

99,596,250

2,639,199

2,639,199

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal—Long Futures Contracts

 

 

 

 

 

 

 

 

5,135,670

5,135,670

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short Futures Contracts

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Rate Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury Ultra Bonds

 

 

 

192

June-2020

(39,840,000)

 

(958,926)

(958,926)

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury 5 Year Notes

 

 

 

317

June-2020

(38,911,750)

 

(381,288)

(381,288)

 

 

 

 

 

 

 

 

 

 

U.S. Treasury 10 Year Ultra Bonds

 

 

 

779

June-2020

(117,020,406)

(1,845,690)

(1,845,690)

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal—Short Futures Contracts

 

 

 

 

 

 

 

 

(3,185,904)

(3,185,904)

Total Futures Contracts

 

 

 

 

 

 

 

 

$ 1,949,766

$ 1,949,766

 

 

 

 

 

 

 

 

 

 

Open Centrally Cleared Credit Default Swap Agreements

 

 

 

 

 

 

 

 

(Pay)/

 

 

 

 

 

 

 

 

 

 

 

 

 

Receive

 

 

Implied

 

 

Upfront

 

 

 

 

 

 

Buy/Sell

Fixed

Payment

 

Credit

 

 

Payments Paid

 

Unrealized

Reference Entity

Protection

Rate

Frequency

Maturity Date

Spread(a)

Notional Value

(Received)

Value

Appreciation

Credit Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

Markit CDX North America High Yield

 

 

 

 

 

 

 

 

 

 

 

 

 

Index, Series 33, Version 2

Buy

(5.00)%

Quarterly

12/20/2024

3.769%

USD 55,393,470

$(5,082,895)

$(2,994,958)

$2,087,937

 

(a)Implied credit spreads represent the current level, as of February 29, 2020, at which protection could be bought or sold given the terms of the existing credit default swap agreement and serve as an indicator of the current status of the payment/performance risk of the credit default swap agreement. An implied credit spread that has widened or increased since entry into the initial agreement 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 generally.

Open Forward Foreign Currency Contracts

 

 

 

 

Contract to

 

 

Unrealized

Settlement

 

 

 

 

Appreciation

 

 

 

 

 

 

Date

 

Counterparty

 

Deliver

 

Receive

(Depreciation)

Currency Risk

 

 

 

 

 

 

 

 

05/29/2020

Canadian Imperial Bank of Commerce

CAD 19,863,000

USD 14,961,303

$

163,537

05/29/2020

Goldman Sachs & Co.

GBP

150,888

USD

195,569

 

1,711

 

 

 

 

 

 

 

 

Subtotal—Appreciation

 

 

 

 

 

 

165,248

Currency Risk

 

 

 

 

 

 

 

 

05/29/2020

Citibank N.A.

EUR

253,538

USD

276,124

 

(5,166)

05/29/2020

Goldman Sachs & Co.

EUR

9,680,250

USD 10,564,589

 

(175,243)

Subtotal—Depreciation

 

 

 

 

 

 

(180,409)

 

 

 

 

 

 

 

 

 

 

Total Forward Foreign Currency Contracts

 

 

 

 

 

$

(15,161)

 

 

 

 

 

 

 

 

 

Abbreviations:

 

 

 

 

 

 

 

 

CAD

—Canadian Dollar

 

 

 

 

 

 

 

EUR

—Euro

 

 

 

 

 

 

 

 

GBP

—British Pound Sterling

 

 

 

 

 

 

 

SPDR —Standard & Poor's Depositary Receipt

 

 

 

 

 

 

 

USD

—U.S. Dollar

 

 

 

 

 

 

 

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

24

Invesco Corporate Bond Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

Investments in securities, at value

 

(Cost $2,000,679,422)

$2,139,352,052

Investments in affiliated money market funds, at value

 

(Cost $64,334,592)

64,336,001

Other investments:

 

Variation margin receivable — futures contracts

324,531

Unrealized appreciation on forward foreign currency

 

contracts outstanding

165,248

Foreign currencies, at value (Cost $2,483,256)

2,485,678

Receivable for:

 

Investments sold

4,387,501

Fund shares sold

8,729,238

Dividends

320,563

Interest

19,440,324

Investment for trustee deferred compensation and

 

retirement plans

208,012

Other assets

60,682

Total assets

2,239,809,830

Liabilities:

 

Other investments:

 

Options written, at value (premiums received

 

$256,463)

886,917

Variation margin payable — centrally cleared swap

 

agreements

70,285

Unrealized depreciation on forward foreign currency

 

contracts outstanding

180,409

Payable for:

 

Investments purchased

13,582,126

Dividends

881,416

Fund shares reacquired

7,725,320

Amount due custodian

778,149

Accrued fees to affiliates

800,353

Accrued trustees' and officers' fees and benefits

4,287

Accrued other operating expenses

344,244

Trustee deferred compensation and retirement plans

228,975

Total liabilities

25,482,481

Net assets applicable to shares outstanding

$2,214,327,349

Net assets consist of:

 

 

Shares of beneficial interest

$2,053,510,712

Distributable earnings

 

160,816,637

 

$2,214,327,349

Net Assets:

 

 

Class A

$1,224,248,147

Class C

$

66,661,742

Class R

$

12,435,044

Class Y

$

343,579,892

Class R5

$

8,536,700

Class R6

$

558,865,824

Shares outstanding, no par value, with an unlimited number of shares authorized:

Class A

 

156,910,009

Class C

 

8,475,032

Class R

 

1,592,846

Class Y

 

43,934,810

Class R5

 

1,092,646

Class R6

 

71,458,127

Class A:

 

 

Net asset value per share

$

7.80

Maximum offering price per share

 

 

(Net asset value of $7.80 ÷ 95.75%)

$

8.15

Class C:

 

 

Net asset value and offering price per share

$

7.87

Class R:

 

 

Net asset value and offering price per share

$

7.81

Class Y:

 

 

Net asset value and offering price per share

$

7.82

Class R5:

 

 

Net asset value and offering price per share

$

7.81

Class R6:

 

 

Net asset value and offering price per share

$

7.82

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

25

Invesco Corporate Bond Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

 

 

Interest

$

71,416,105

 

Dividends

 

1,991,111

 

Dividends from affiliated money market funds

 

746,254

 

 

Total investment income

 

74,153,470

 

Expenses:

 

 

 

 

Advisory fees

 

5,953,163

 

Administrative services fees

 

258,095

 

 

Custodian fees

 

100,983

 

 

Distribution fees:

 

 

 

 

Class A

 

2,702,111

 

Class C

 

498,891

 

 

Class R

 

47,156

 

 

Transfer agent fees — A, C, R and Y

 

2,187,867

 

Transfer agent fees — R5

 

7,456

 

 

Transfer agent fees — R6

 

70,557

 

 

Trustees' and officers' fees and benefits

 

40,244

 

 

Registration and filing fees

 

170,430

 

 

Reports to shareholders

 

364,436

 

 

Professional services fees

 

99,956

 

 

Other

 

75,311

 

 

Total expenses

 

12,576,656

 

Less: Fees waived and/or expense offset arrangement(s)

 

(50,641)

Net expenses

 

12,526,015

 

Net investment income

 

61,627,455

 

Realized and unrealized gain (loss) from:

 

 

 

 

Net realized gain (loss) from:

 

 

 

 

Investment securities

 

38,624,371

 

Foreign currencies

 

(133,968)

Forward foreign currency contracts

 

416,951

 

 

Futures contracts

 

2,352,505

 

 

Option contracts written

 

178,716

 

 

Swap agreements

 

(166,390)

 

 

41,272,185

 

Change in net unrealized appreciation (depreciation) of:

 

 

 

 

Investment securities

 

148,689,419

 

Foreign currencies

 

2,455

 

 

Forward foreign currency contracts

 

(7,988)

Futures contracts

 

2,152,996

 

Option contracts written

 

(603,697)

Swap agreements

 

2,087,937

 

 

 

152,321,122

 

Net realized and unrealized gain

 

193,593,307

 

Net increase in net assets resulting from operations

$

255,220,762

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

26

Invesco Corporate Bond Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

Operations:

 

 

 

 

 

 

Net investment income

$

61,627,455

$

62,749,097

 

Net realized gain (loss)

 

41,272,185

 

(14,858,734)

 

 

 

 

 

 

Change in net unrealized appreciation (depreciation)

 

152,321,122

 

(24,719,740)

Net increase in net assets resulting from operations

 

255,220,762

 

23,170,623

 

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

Class A

 

(39,207,717)

 

(39,985,134)

 

 

 

 

 

 

Class C

 

(1,423,644)

 

(2,347,265)

 

 

 

 

 

 

Class R

 

(314,228)

 

(286,266)

 

 

 

 

 

 

Class Y

 

(7,404,773)

 

(3,526,392)

 

 

 

 

 

 

Class R5

 

(299,295)

 

(289,714)

 

 

 

 

 

 

Class R6

 

(18,464,031)

 

(18,562,159)

 

 

 

 

 

 

Total distributions from distributable earnings

 

(67,113,688)

 

(64,996,930)

Share transactions–net:

 

 

 

 

 

 

Class A

 

142,684,257

 

(7,544,776)

 

 

 

 

 

 

Class C

 

24,316,590

 

(43,254,102)

 

 

 

 

 

 

Class R

 

4,577,992

 

(104,011)

Class Y

 

237,103,282

 

968,322

 

 

Class R5

 

902,229

 

3,168,593

 

Class R6

 

122,588,233

 

(14,236,672)

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from share transactions

 

532,172,583

 

(61,002,646)

 

 

 

 

 

 

Net increase (decrease) in net assets

 

720,279,657

 

(102,828,953)

Net assets:

 

 

 

 

 

 

Beginning of year

 

1,494,047,692

 

1,596,876,645

 

End of year

$2,214,327,349

$1,494,047,692

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

27

Invesco Corporate Bond Fund

Financial Highlights

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

Net gains

 

 

 

 

 

 

 

 

to average

to average net

 

 

 

 

 

(losses)

 

 

 

 

 

 

 

 

net assets

assets without

Ratio of net

 

 

Net asset

 

on securities

 

Dividends

Distributions

 

 

 

 

with fee waivers

fee waivers

investment

 

 

value,

Net

(both

Total from

from net

from net

 

Net asset

 

Net assets,

and/or

and/or

income

 

 

beginning

investment

realized and

investment

investment

realized

Total

value, end

Total

end ofperiod

expenses

expenses

to average

Portfolio

 

ofperiod

income(a)

unrealized)

operations

income

gains

distributions

ofperiod

return (b)

(000's omitted)

absorbed

absorbed

net assets

turnover (c)

Class A

 

 

 

 

 

 

 

 

 

 

 

0.80%(d)

0.80%(d)

3.30%(d)

 

Year ended 02/29/20

$7.02

$0.25

$ 0.80

$ 1.05

$(0.27)

$

$(0.27)

$7.80

15.20%

$1,224,248

192%

Year ended 02/28/19

7.20

0.28

(0.17)

0.11

(0.29)

 

(0.00)

(0.29)

7.02

1.65

968,160

0.83

0.83

4.00

145

Year ended 02/28/18

7.31

0.26

(0.06)

0.20

(0.27)

 

(0.04)

(0.31)

7.20

2.68

1,001,173

0.85

0.85

3.58

180

Year ended 02/28/17

6.89

0.26

0.42

0.68

(0.26)

 

(0.26)

7.31

9.97

948,305

0.90

0.90

3.60

212

Year ended 02/29/16

7.40

0.27

(0.52)

(0.25)

(0.26)

 

(0.26)

6.89

(3.37)

873,526

0.90

0.90

3.79

202

Class C

 

 

 

 

 

 

 

 

 

 

 

1.55(d)

1.55(d)

2.55(d)

192

Year ended 02/29/20

7.08

0.19

0.82

1.01

(0.22)

 

(0.22)

7.87

14.43

66,662

Year ended 02/28/19

7.26

0.23

(0.17)

0.06

(0.24)

 

(0.00)

(0.24)

7.08

0.91(e)

37,280

1.53

1.53

3.30

145

Year ended 02/28/18

7.36

0.21

(0.06)

0.15

(0.21)

 

(0.04)

(0.25)

7.26

2.07(e)

82,939

1.58(e)

1.58(e)

2.85(e)

180

Year ended 02/28/17

6.92

0.21

0.42

0.63

(0.19)

 

(0.19)

7.36

9.17

85,127

1.65

1.65

2.85

212

Year ended 02/29/16

7.42

0.22

(0.53)

(0.31)

(0.19)

 

(0.19)

6.92

(4.18)(e)

68,853

1.64(e)

1.64(e)

3.05(e)

202

Class R

 

 

 

 

 

 

 

 

 

 

 

1.05(d)

1.05(d)

3.05(d)

192

Year ended 02/29/20

7.02

0.23

0.81

1.04

(0.25)

 

(0.25)

7.81

15.06

12,435

Year ended 02/28/19

7.21

0.26

(0.17)

0.09

(0.28)

 

(0.00)

(0.28)

7.02

1.30

6,889

1.08

1.08

3.75

145

Year ended 02/28/18

7.31

0.25

(0.06)

0.19

(0.25)

 

(0.04)

(0.29)

7.21

2.57

7,196

1.10

1.10

3.33

180

Year ended 02/28/17

6.89

0.24

0.42

0.66

(0.24)

 

(0.24)

7.31

9.70

6,742

1.15

1.15

3.35

212

Year ended 02/29/16

7.40

0.26

(0.52)

(0.26)

(0.25)

 

(0.25)

6.89

(3.62)

6,847

1.15

1.15

3.54

202

Class Y

 

 

 

 

 

 

 

 

 

 

 

0.55(d)

0.55(d)

3.55(d)

 

Year ended 02/29/20

7.03

0.27

0.81

1.08

(0.29)

 

(0.29)

7.82

15.62

343,580

192

Year ended 02/28/19

7.22

0.30

(0.18)

0.12

(0.31)

 

(0.00)

(0.31)

7.03

1.76

86,657

0.58

0.58

4.25

145

Year ended 02/28/18

7.32

0.28

(0.05)

0.23

(0.29)

 

(0.04)

(0.33)

7.22

3.08

87,895

0.60

0.60

3.83

180

Year ended 02/28/17

6.90

0.28

0.42

0.70

(0.28)

 

(0.28)

7.32

10.23

235,464

0.65

0.65

3.85

212

Year ended 02/29/16

7.41

0.29

(0.52)

(0.23)

(0.28)

 

(0.28)

6.90

(3.11)

26,500

0.65

0.65

4.04

202

Class R5

 

 

 

 

 

 

 

 

 

 

 

0.49(d)

0.49(d)

3.61(d)

192

Year ended 02/29/20

7.03

0.27

0.80

1.07

(0.29)

 

(0.29)

7.81

15.55

8,537

Year ended 02/28/19

7.21

0.30

(0.17)

0.13

(0.31)

 

(0.00)

(0.31)

7.03

2.00

6,841

0.49

0.49

4.34

145

Year ended 02/28/18

7.31

0.29

(0.06)

0.23

(0.29)

 

(0.04)

(0.33)

7.21

3.16

3,829

0.53

0.53

3.90

180

Year ended 02/28/17

6.89

0.29

0.42

0.71

(0.29)

 

(0.29)

7.31

10.34

5,222

0.56

0.56

3.94

212

Year ended 02/29/16

7.40

0.29

(0.51)

(0.22)

(0.29)

 

(0.29)

6.89

(2.98)

4,547

0.54

0.54

4.15

202

Class R6

 

 

 

 

 

 

 

 

 

 

 

0.41(d)

0.41(d)

3.69(d)

 

Year ended 02/29/20

7.04

0.28

0.80

1.08

(0.30)

 

(0.30)

7.82

15.62

558,866

192

Year ended 02/28/19

7.22

0.31

(0.17)

0.14

(0.32)

 

(0.00)

(0.32)

7.04

2.01

388,221

0.43

0.43

4.40

145

Year ended 02/28/18

7.32

0.30

(0.06)

0.24

(0.30)

 

(0.04)

(0.34)

7.22

3.25

413,844

0.44

0.44

3.99

180

Year ended 02/28/17

6.90

0.29

0.42

0.71

(0.29)

 

(0.29)

7.32

10.43

29,232

0.47

0.47

4.03

212

Year ended 02/29/16

7.40

0.30

(0.50)

(0.20)

(0.30)

 

(0.30)

6.90

(2.80)

22,567

0.46

0.46

4.23

202

(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 based on average daily net assets (000's omitted) of $1,083,445, $49,889, $9,431, $196,357, $7,608 and $461,526 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.

(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 0.95%, 0.98% and 0.99% for the years ended February 28, 2019, February 28, 2018 and February 29, 2016, respectively.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

28

Invesco Corporate Bond Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco Corporate Bond Fund (the "Fund"), is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"). The Trust is organized as a Delaware statutory trust and is 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 primary investment objective is to seek to provide current income with preservation of capital. Capital appreciation is a secondary objective that is sought only when consistent with the Fund's primary investment objective.

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.

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.

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.

Variable rate senior loan interests are fair valued using quotes provided by an independent pricing service. Quotes provided by the pricing service may reflect appropriate factors such as ratings, tranche type, industry, company performance, spread, individual trading characteristics, institution-size trading in similar groups of securities and other market data.

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.

Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.

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 economic conditions, interest rates, investor perceptions 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 settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash

29

Invesco Corporate Bond Fund

dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Paydown gains and losses on mortgage and asset-backed securities are recorded as adjustments to interest income. 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 realized and unrealized capital gains and losses to a class based on the relative net assets of each class. The Fund allocates income to a class based on the relative value of the settled shares 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, if any, are declared daily and paid monthly. Distributions from 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 Fund's organizational documents, each Trustee, officer, employee or other agent of the Fund 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

30

Invesco Corporate Bond Fund

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.

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 covered 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. 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.

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.

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 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.

31

Invesco Corporate Bond Fund

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.

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, ISDA master agreements include 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. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund's exposure is unlimited.

Notional amounts of each individual credit default swap agreement outstanding as of February 29, 2020 for which the Fund is the seller of protection are disclosed in the open swap agreements table. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by the Fund for the same referenced entity or entities.

N.Other Risks - Active trading of portfolio securities may result in added expenses, a lower return and increased tax liability.

O.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.

P.Collateral —To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund's practice to replace such collateral no later than the next business day.

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

0.420%

Next $750 million

0.350%

Over $1.25 billion

0.220%

 

 

For the year ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.33%.

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, 2020, 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 1.50%, 2.25%, 1.75%, 1.25%, 1.25% and 1.25%, 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; (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, 2020. 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.

The Adviser has contractually agreed, through at least June 30, 2021, 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 year ended February 29, 2020, the Adviser waived advisory fees of $40,754.

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 year ended February 29, 2020, 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 year ended February 29, 2020, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.

Shares of the Fund are distributed by Invesco Distributors, Inc. ("IDI"). The Fund has adopted a distribution plan pursuant to Rule 12b-1 under the 1940 Act, and a service plan (collectively, the "Plans") for Class A shares, Class C shares and Class R shares to compensate IDI for the sale, distribution, shareholder servicing and

32

Invesco Corporate Bond Fund

maintenance of shareholder accounts for these shares. Under the Plans, the Fund will incur annual fees of up to 0.25% of Class A average daily net assets and up to 1.00% of Class C average daily net assets and 0.50% of Class R average daily net assets. The fees are accrued daily and paid monthly.

With respect to Class C shares, the Fund is authorized to reimburse in future years any distribution related expenses that exceed the maximum annual reimbursement rate for such class, so long as such reimbursement does not cause the Fund to exceed the Class C maximum annual reimbursement rate, respectively. With respect to Class A shares, distribution related expenses that exceed the maximum annual reimbursement rate for such class are not carried forward to future years and the Fund will not reimburse IDI for any such expenses.

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 year ended February 29, 2020, IDI advised the Fund that IDI retained $189,239 in front-end sales commissions from the sale of Class A shares and $17,377 and $2,812 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 February 29, 2020. 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

 

 

 

 

 

 

 

 

U.S. Dollar Denominated Bonds & Notes

$

$1,937,711,759

$

$1,937,711,759

 

U.S. Treasury Securities

 

107,099,495

 

107,099,495

 

Preferred Stocks

 

36,071,720

 

36,071,720

 

Asset-Backed Securities

 

28,413,938

 

28,413,938

 

Variable Rate Senior Loan Interests

 

 

12,379,457

12,379,457

 

Non-U.S. Dollar Denominated Bonds & Notes

 

11,249,536

 

11,249,536

 

Municipal Obligations

 

5,301,625

 

234,330

5,535,955

 

Common Stocks & Other Equity Interests

 

1,633

 

1

1,634

 

 

Money Market Funds

 

64,336,001

 

64,336,001

 

Options Purchased

 

888,558

 

888,558

 

 

Total Investments in Securities

 

101,297,912

2,089,776,353

 

12,613,788

2,203,688,053

 

Other Investments - Assets*

 

 

 

 

 

 

 

 

Futures Contracts

 

5,135,670

 

5,135,670

 

Forward Foreign Currency Contracts

 

165,248

 

165,248

 

 

Swap Agreements

 

2,087,937

 

2,087,937

 

 

 

5,135,670

2,253,185

 

7,388,855

 

Other Investments - Liabilities*

 

 

 

 

 

 

 

 

Futures Contracts

 

(3,185,904)

 

(3,185,904)

 

 

 

 

 

 

 

 

Forward Foreign Currency Contracts

 

(180,409)

 

(180,409)

 

 

 

 

 

 

 

 

Options Written

 

(17,760)

(869,157)

 

(886,917)

 

 

 

 

 

 

 

 

 

 

(3,203,664)

(1,049,566)

 

(4,253,230)

Total Other Investments

 

1,932,006

1,203,619

 

3,135,625

 

Total Investments

$103,229,918

$2,090,979,972

$

12,613,788

$2,206,823,678

 

*Forward foreign currency contracts, futures contracts and swap agreements are valued at unrealized appreciation (depreciation). Options written are shown at value.

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.

33

Invesco Corporate Bond 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 February 29, 2020:

 

 

 

 

 

 

 

Value

 

 

 

 

 

 

 

 

 

Credit

 

Currency

 

Equity

 

Interest

 

 

 

 

Derivative Assets

 

 

Risk

 

Risk

 

Risk

 

Rate Risk

 

Total

 

Unrealized appreciation on futures contracts — Exchange-Traded(a)

$

-

$

-

$

-

$

5,135,670

$

5,135,670

Unrealized appreciation on swap agreements — Centrally Cleared(a)

 

 

2,087,937

 

-

 

-

 

-

 

2,087,937

 

Unrealized appreciation on forward foreign currency contracts

 

 

 

 

 

 

 

 

 

 

 

 

 

outstanding

 

 

-

 

165,248

 

-

 

-

 

165,248

 

Options purchased, at value — Exchange-Traded

 

 

-

 

-

 

888,558

 

-

 

888,558

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Derivative Assets

 

 

2,087,937

 

165,248

 

888,558

 

5,135,670

 

8,277,413

 

Derivatives not subject to master netting agreements

 

 

(2,087,937)

 

-

 

(888,558)

 

(5,135,670)

 

(8,112,165)

 

 

 

 

 

 

 

 

 

 

 

 

Total Derivative Assets subject to master netting agreements

$

-

$

165,248

$

-

$

-

$

165,248

 

 

 

 

 

 

 

 

Value

 

 

 

 

 

 

 

 

 

Credit

 

Currency

 

Equity

 

Interest

 

 

 

 

Derivative Liabilities

 

 

Risk

 

Risk

 

Risk

 

Rate Risk

 

Total

 

Unrealized depreciation on futures contracts — Exchange-Traded(a)

$

-

$

-

$

-

$(3,185,904)

$(3,185,904)

Unrealized depreciation on forward foreign currency contracts

 

 

 

 

 

 

 

 

 

 

 

 

 

outstanding

 

 

-

 

(180,409)

 

-

 

-

 

(180,409)

 

 

 

 

 

 

 

 

 

 

 

 

 

Options written, at value — Exchange-Traded

 

 

-

 

-

 

(17,760)

 

-

 

(17,760)

 

 

 

 

 

 

 

 

 

 

 

 

 

Options written, at value — OTC

 

 

(869,157)

 

-

 

-

 

-

 

(869,157)

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Derivative Liabilities

 

 

(869,157)

 

(180,409)

 

(17,760)

 

(3,185,904)

 

(4,253,230)

Derivatives not subject to master netting agreements

 

 

-

 

-

 

17,760

 

3,185,904

 

3,203,664

 

 

 

 

 

 

 

 

 

 

 

 

Total Derivative Liabilities subject to master netting agreements

$

(869,157)

$(180,409)

$

-

$

-

$

(1,049,566)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a)The daily variation margin receivable (payable) at period-end is recorded in the Statement of Assets and Liabilities.

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 February 29, 2020.

 

Financial Derivative Assets

Financial Derivative Liabilities

 

 

 

 

 

 

 

 

Forward

 

 

Forward

 

 

 

 

 

 

 

 

 

 

 

Foreign

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

Currency

 

Currency

 

Options

 

Total

Net Value of

Collateral

Net

 

Counterparty

Contracts

Contracts

 

Written

 

Liabilities

Derivatives

(Received/Pledged)

Amount

 

Canadian Imperial Bank of Commerce

$163,537

 

$

-

$

-

 

$

-

$ 163,537

$-

$-

$ 163,537

 

Citibank N.A.

-

 

 

(5,166)

 

-

 

 

(5,166)

(5,166)

-

-

(5,166)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Goldman Sachs International

1,711

 

 

(175,243)

 

-

 

 

(175,243)

(173,532)

-

-

(173,532)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Morgan Stanley and Co. International PLC

-

 

 

-

 

(869,157)

 

 

(869,157)

(869,157)

-

-

(869,157)

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

$165,248

 

$(180,409)

$(869,157)

 

$(1,049,566)

$(884,318)

$-

$-

$(884,318)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effect of Derivative Investments for the year ended February 29, 2020

The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:

 

 

 

 

 

Location of Gain (Loss) on

 

 

 

 

 

 

 

 

 

Statement of Operations

 

 

 

 

 

 

 

Credit

Currency

 

Equity

 

Interest

 

 

 

 

 

Risk

Risk

 

Risk

 

Rate Risk

Total

Realized Gain (Loss):

 

 

 

 

 

 

 

 

 

 

Forward foreign currency contracts

$

-

$416,951

$

-

$

-

$ 416,951

 

Futures contracts

 

 

-

-

 

-

 

2,352,505

2,352,505

Options purchased(a)

 

 

-

-

 

898,746

 

-

898,746

 

Options written

 

 

223,873

-

 

(45,157)

 

-

178,716

 

 

 

 

 

 

 

 

 

 

 

 

Swap agreements

 

 

(166,390)

-

 

-

 

-

(166,390)

 

 

 

 

 

 

 

 

 

 

 

34

Invesco Corporate Bond Fund

 

 

 

 

 

 

Location of Gain (Loss) on

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations

 

 

 

 

 

 

 

 

 

Credit

Currency

 

Equity

 

Interest

 

 

 

 

 

 

 

Risk

 

Risk

 

Risk

 

Rate Risk

 

Total

Change in Net Unrealized Appreciation (Depreciation):

 

 

 

 

 

 

 

 

 

 

 

 

 

Forward foreign currency contracts

$

-

$

(7,988)

$

-

$

-

$

(7,988)

Futures contracts

 

 

-

 

-

 

-

 

2,152,996

 

2,152,996

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Options purchased(a)

 

 

-

 

-

 

(434,528)

 

-

 

(434,528)

 

 

 

 

 

 

 

 

 

 

 

 

 

Options written

 

 

(650,353)

 

-

 

46,656

 

-

 

(603,697)

Swap agreements

 

 

2,087,937

 

-

 

-

 

-

 

2,087,937

 

 

 

 

 

 

 

 

 

 

 

 

Total

$

1,495,067

$408,963

$

465,717

$4,505,501

$

6,875,248

 

 

(a)Options purchased are included in the net realized gain (loss) from investment securities and the change in net unrealized appreciation (depreciation) of investment securities.

The table below summarizes the average notional value of derivatives held during the period.

 

Forward

 

Equity

Index

Equity

 

 

 

Foreign Currency

Futures

Options

Options

Options

Swaptions

Swap

 

Contracts

Contracts

Purchased

Purchased

Written

Written

Agreements

Average notional value

$19,436,658

$404,164,354

$2,651,988

$14,623,333

$856,221

$50,460,000

$70,924,788

 

 

 

 

 

 

 

 

Average Contracts

237

48

33

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $9,887.

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—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 29, 2020 and February 28, 2019:

 

 

2020

2019

 

 

Ordinary income

$67,113,688

$64,595,437

 

Long-term capital gain

401,493

 

 

 

 

 

 

 

 

Total distributions

$67,113,688

$64,996,930

 

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

2020

 

 

Undistributed ordinary income

 

$ 26,598,989

 

Net unrealized appreciation — investments

 

134,408,913

 

 

 

 

 

 

Net unrealized appreciation - foreign currencies

 

2,555

 

 

Temporary book/tax differences

 

(193,820)

Shares of beneficial interest

 

2,053,510,712

 

 

 

 

 

Total net assets

 

$2,214,327,349

 

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to futures, straddle loss deferrals and book to tax accretion and amortization differences.

35

Invesco Corporate Bond Fund

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund does not have a capital loss carryforward as of February 29, 2020.

NOTE 9—Investment Transactions

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the year ended February 29, 2020 was $1,980,347,859 and $1,449,518,935, respectively. During the same period, purchases and sales of

U.S. Treasury obligations were $1,895,435,675 and $1,925,505,630, 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

$146,103,393

 

Aggregate unrealized (depreciation) of investments

(11,694,480)

Net unrealized appreciation of investments

$134,408,913

 

Cost of investments for tax purposes is $2,072,633,569.

NOTE 10—Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of bond premiums, swap income, distributions and foreign currency, on February 29, 2020, undistributed net investment income was increased by $1,694,197 and undistributed net realized gain was decreased by $1,694,197. This reclassification had no effect on the net assets or the distributable earnings of the Fund.

NOTE 11—Share Information

Summary of Share Activity

 

Year ended

 

Year ended

 

February 29, 2020(a)

 

 

February 28, 2019

 

 

Shares

Amount

 

Shares

 

Amount

Sold:

 

 

 

 

 

 

 

 

 

Class A

35,473,678

$ 265,742,466

22,630,208

$

158,265,062

 

Class C

4,995,520

37,734,235

1,644,529

 

11,664,181

 

Class R

846,111

6,311,286

299,482

 

2,104,226

 

 

Class Y

36,561,873

274,343,654

6,772,125

 

47,607,764

 

Class R5

240,168

1,800,871

527,336

 

3,768,703

 

 

Class R6

24,644,498

184,754,126

16,991,650

 

120,048,362

 

Issued as reinvestment of dividends:

 

 

 

 

 

 

 

 

 

Class A

4,531,180

33,863,830

5,046,534

 

35,328,974

 

 

Class C

144,917

1,094,634

278,543

 

1,966,430

 

 

Class R

41,726

312,904

40,314

 

282,480

 

 

Class Y

704,707

5,325,759

319,405

 

2,239,815

 

Class R5

39,872

298,388

41,138

 

288,128

 

 

Class R6

2,262,580

16,973,096

2,471,199

 

17,337,173

 

Automatic conversion of Class C shares to Class A shares:

 

 

 

 

 

 

 

 

 

Class A

430,893

3,202,034

-

 

-

 

 

Class C

(427,339)

(3,202,034)

-

 

-

 

 

Reacquired:

 

 

 

 

 

 

 

 

 

Class A

(21,473,851)

(160,124,073)

(28,738,755)

 

(201,138,812)

 

 

 

 

 

 

 

Class C

(1,503,420)

(11,310,245)

(8,085,359)

 

(56,884,713)

 

 

 

 

 

 

 

Class R

(276,033)

(2,046,198)

(356,893)

 

(2,490,717)

 

 

 

 

 

 

 

Class Y

(5,650,686)

(42,566,131)

(6,948,007)

 

(48,879,257)

 

 

 

 

 

 

 

Class R5

(160,791)

(1,197,030)

(126,151)

 

(888,238)

 

 

 

 

 

 

 

Class R6

(10,627,583)

(79,138,989)

(21,631,387)

 

(151,622,207)

 

 

 

 

 

 

 

Net increase (decrease) in share activity

70,798,020

$ 532,172,583

(8,824,089)

$

(61,002,646)

 

 

 

 

 

 

 

 

 

 

(a)There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 66% 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.

36

Invesco Corporate Bond Fund

NOTE 12—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

37

Invesco Corporate Bond Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Corporate Bond

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Corporate Bond (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the five years in the period ended February 29, 2020 (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the five years in the period ended February 29, 2020 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, Texas

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

38

Invesco Corporate Bond 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 September 1, 2019 through February 29, 2020.

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

 

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

 

Period2

Ratio

Class A

$1,000.00

$1,042.00

 

$3.91

$1,021.03

 

$3.87

0.77%

 

 

 

 

 

 

 

 

 

Class C

1,000.00

1,039.20

 

7.71

1,017.30

 

7.62

1.52

 

 

 

 

 

 

 

 

 

Class R

1,000.00

1,040.70

 

5.18

1,019.79

 

5.12

1.02

 

 

 

 

 

 

 

 

 

Class Y

1,000.00

1,043.20

 

2.64

1,022.28

 

2.61

0.52

Class R5

1,000.00

1,043.50

 

2.39

1,022.53

 

2.36

0.47

 

 

 

 

 

 

 

 

 

Class R6

1,000.00

1,043.90

 

1.93

1,022.97

 

1.91

0.38

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

39

Invesco Corporate Bond Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisors.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Federal and State Income Tax

Qualified Dividend Income*

6.61%

Corporate Dividends Received Deduction*

6.54%

U.S. Treasury Obligations*

2.98%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

40

Invesco Corporate Bond Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

T-1

Invesco Corporate Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

 

 

 

 

 

T-2

Invesco Corporate Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-3

Invesco Corporate Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-4

Invesco Corporate Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-5

Invesco Corporate Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-6

Invesco Corporate Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

State Street Bank and Trust Company

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

225 Franklin Street

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Boston, MA 02110-2801

T-7

Invesco Corporate Bond Fund

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 holdings four times in each fiscal year, at the quarter-ends. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 033-39519

Invesco Distributors, Inc.

VK-CBD-AR-1

Annual Report to Shareholders

February 29, 2020

Invesco Global Real Estate Fund

Nasdaq:

A: AGREX ￿ C: CGREX ￿ R: RGREX ￿ Y: ARGYX ￿ R5: IGREX ￿ R6: FGREX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's web- site, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call (800) 959-4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

4 Performance Summary

6 Long-Term Fund Performance

8 Supplemental Information

9 Schedule of Investments

12 Financial Statements

15 Financial Highlights

16 Notes to Financial Statements

22Report of Independent Registered Public Accounting Firm

23Fund Expenses

24Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco Global Real Estate Fund

Bruce Crockett

Dear Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco Global Real Estate Fund

Management's Discussion of Fund Performance

Performance summary

For the fiscal year ended February 29, 2020, Class A shares of Invesco Global Real Estate Fund (the Fund), at net asset value (NAV), outperformed the Fund's style- specific benchmark, the Custom Invesco Global Real Estate Index.

Your Fund's long-term performance appears later in this report.

Fund vs. Indexes

Total returns, 2/28/19 to 2/29/20, 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

3.28%

Class C Shares

2.51

Class R Shares

3.02

Class Y Shares

3.55

Class R5 Shares

3.68

Class R6 Shares

3.77

MSCI World Index￿ (Broad Market Index)

4.63

Custom Invesco Global Real Estate Index￿ (Style-Specific Index)

2.20

Lipper Global Real Estate Funds Classification Average￿ (Peer Group)

4.54

Source(s): ￿RIMES Technologies Corp.;￿Invesco, RIMES Technologies Corp.;￿Lipper Inc.

companies are mid-way through reporting year-end financial results. There have been few surprises so far. Retail has been weak, with declines in asset values and some emerg- ing re-purposing strategies to meet the chal- lenges of excess mall capacity. Elsewhere, across most property types and geographies, results have been positive, showing asset value and earnings growth. Management teams continue to show cautious optimism, with a willingness to continue to acquire and develop assets. Listed real estate ends the fiscal year trading at a small discount to net asset value (NAV) on average. European and US REITs are trading at or above NAV on av- erage, while Asian real estate shows discounts in Hong Kong and Japan.

During the fiscal year, the Fund's security selection in the US, UK and Hong Kong con- tributed to performance relative to its style- specific benchmark. Conversely, relative de- tractors included an underweight allocation to Belgium and an allocation to cash. Although the portfolio held a small amount of ancillary

Market conditions and your Fund

At the close of the fiscal year, equity markets reacted strongly to the prospect of dimin- ished global growth as a result of the impact of the Coronavirus (COVID-19) outbreak. At the close of the fiscal year, GDP growth esti- mates for 2020 were cut, as the magnitude and duration of the impact are still far from clear. Government bond yields fell amid risk aversion and in anticipation of interest rate cuts from key central banks. Hong Kong, Sin- gapore and the Chinese government were the first to add stimulus to their economies, with many economic activity indicators showing recessionary levels. However, additional stimulus measures are expected from most central banks around the world to support domestic economies hit by uncertainty. Completion of phase one of a trade deal be- tween China and the US had previously of- fered some positive news to capital markets following significant uncertainty during 2019. We believe negotiations on future trade terms will likely continue. The fiscal year ended with US consumer confidence rising for four con-

Portfolio Composition

By country

% of total net assets

United States

48.25%

Japan

10.62

China

5.80

Germany

 

5.78

Hong Kong

 

5.40

United Kingdom

 

4.13

Canada

 

3.14

Australia

 

3.05

Singapore

 

2.51

Sweden

 

2.14

Countries, each less than 2% of

 

portfolio

 

7.24

Money Market Funds Plus Other

 

Assets Less Liabilities

 

1.94

secutive months and was accompanied by increases in housing starts and non-farm pay- rolls. However, areas of caution remain in the US, as industrial production and retail sales reported slight declines. Brexit is now guaran- teed, and the focus will now move to future trade arrangements with the European Union. Published European economic data has shown some stabilization, with the European manu- facturing index showing its highest level in over a year. However, we believe it is likely that the coronavirus outbreak will diminish upcoming activity and resulting economic and wider corporate earnings data.

Global listed real estate offered positive absolute performance over the fiscal year driven by a combination of supportive funda- mental and macro-related factors. Real estate investment trusts (REITs) generally out- performed other risk assets through the late period market sell-off, reflecting underlying income security, as markets tended to reward predictable growth and well-covered divi- dends during a period of falling bond yields and slowing global growth. Listed real estate

Top 10 Equity Holdings*

% of total net assets

1. Boston Properties, Inc.

3.96%

2. AvalonBay Communities, Inc.

2.84

3. Vonovia SE

2.79

4. Ventas, Inc.

2.35

5.

UDR, Inc.

2.12

6.

Simon Property Group, Inc.

2.06

7.

VEREIT, Inc.

2.00

8.

Healthpeak Properties, Inc.

1.88

9.

Invitation Homes, Inc.

1.79

10.

Prologis, Inc.

1.74

cash, it detracted as markets gained through much of the fiscal year.

Top individual absolute contributors to the Fund's performance during the fiscal year included Prologis and Mid-America Apart- ment Communities. In one of the largest transactions of 2019, Prologis acquired Lib- erty Property Trust in an all-stock deal valued at $12.6 billion, representing an opportunity for Prologis to utilize their global platform as a leading operator of distribution centers that serve local consumers or more global trade routes. Additionally, several residential REITs did well over the year, benefiting from eco- nomic and job growth tailwinds, including Mid- America Apartment Communities.

Top individual absolute detractors from Fund performance during the fiscal year in- cluded two positions in the challenged retail sector, Simon Property Group and Macerich. Simon Property Group is the largest mall owner in the US. The company has a strong management team and a track record of pre- dictable cash flow growth, strong asset alloca- tion, and attractive reinvestment returns.

The Fund's holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.

*Excluding money market fund holdings.

Data presented here are as of February 29, 2020.

4Invesco Global Real Estate Fund

Macerich is a regional mall operator that owns high quality properties in the US. The company offered a discounted valuation and the prospect of stabilized operating results.

At the end of the fiscal year, on a regional and country level, the Fund was overweight North America overall, with overweight posi- tioning in Canada and relatively neutral posi- tioning to the US, relative to the style-specific index. Canadian real estate continues to offer a modest yield premium, geopolitical stability and consistent real estate fundamental growth. In the US, positioning is focused on sectors and market exposures that support rental growth, as well as companies that can generate growth from attractive capital de- ployment opportunities.

Relative to the style-specific index, the Fund held a modest underweight allocation to the Asia Pacific region at the end of the fiscal year. Across the region, the Fund had gener- ally neutral allocations to Australia and Japan and slight underweight exposures to Singa- pore and Hong Kong. Key active positioning reflects underweight exposure to retail fo- cused REITs in the region and overweight exposure to industrial real estate and diversi- fied developers.

The Fund ended the fiscal year with neutral exposure to Europe, relative to its style- specific index. Key active positioning reflects material underweight exposure to retail fo- cused REITs and overweight exposure to resi- dential real estate. The Fund held under- weight positions in Belgium and the Netherlands, and material country overweight exposure to Germany. Additionally, France and Spain show overweight exposure, driven by positions in office focused REITs.

Relative to the style-specific index, the Fund ended the fiscal year with an under- weight allocation to emerging markets (EM). Key active positioning for EM reflects under- weight exposure to ASEAN, Brazilian and Chi- nese homebuilders.

At the end of the fiscal year, real estate continued to offer investors tangible asset exposure, with rents that can adjust upwards (or downwards) over time with economic strength and inflation. Listed real estate com- panies were generally maintaining financial discipline. Falling credit costs were improving cash flows modestly, and absolute levels of debt remained in check. Many companies had the ability to utilize attractively priced new equity and debt to complete accretive acquisi- tions and enhance their growth rate. While recognizing the need to maintain attractive yield characteristics in an income starved world, our overall portfolio maintains a bias toward companies that we believe have higher quality assets, supply constrained real estate market exposure, generally lower lev- eraged balance sheets and most importantly, above average earnings and asset value growth.

We thank you for your continued invest- ment in Invesco Global Real Estate Fund.

Portfolio managers:

Mark Blackburn

James Cowen - Lead

Paul Curbo - Lead

Grant Jackson

Joe Rodriguez, Jr. - Lead

Darin Turner

Ping-Ying Wang - Lead

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

5Invesco Global Real Estate Fund

Your Fund's Long-Term Performance

Results of a $10,000 Investment — Oldest Share Class(es)

Fund and index data from 2/28/10

$30,000

$23,129 MSCI World Index1

$22,032 Lipper Global Real Estate Funds Classification Average3

25,000$21,614 Custom Invesco Global Real Estate Index2 $21,128 Invesco Global Real Estate Fund — Class R5 Shares

20,000

$19,601 Invesco Global Real Estate Fund — Class R Shares

$19,031 Invesco Global Real Estate Fund — Class A Shares

$18,653 Invesco Global Real Estate Fund — Class C Shares

15,000

10,000

5,000

2/28/10

2/11

2/12

2/13

2/14

2/15

2/16

2/17

2/18

2/19

2/20

1 Source: RIMES Technologies Corp.

2Source: Invesco, RIMES Technologies Corp.

3 Source: Lipper Inc.

Past performance cannot guarantee future results.

The data shown in the chart include rein- vested distributions, applicable sales charges and Fund expenses including management

fees. Index results include reinvested divi- dends, but they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses and management fees;

performance of a market index does not. Per- formance shown in the chart does not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares.

6Invesco Global Real Estate Fund

Average Annual Total Returns

As of 2/29/20, including maximum applicable sales charges

Class A Shares

Inception (4/29/05)

5.05%

10 Years

6.65

5

Years

1.82

1

Year

–2.38

Class C Shares

 

Inception (4/29/05)

4.92%

10 Years

6.43

5

Years

2.20

1

Year

1.59

Class R Shares

 

Inception (4/29/05)

5.18%

10 Years

6.96

5

Years

2.70

1

Year

3.02

Class Y Shares

 

Inception (10/3/08)

6.35%

10 Years

7.51

5

Years

3.23

1

Year

3.55

Class R5 Shares

 

Inception (4/29/05)

5.94%

10 Years

7.77

5

Years

3.38

1

Year

3.68

Class R6 Shares

 

10 Years

7.66%

5

Years

3.47

1

Year

3.77

Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.

The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month- end performance. Performance figures re- flect reinvested distributions, changes in net asset value and the effect of the maxi- mum sales charge unless otherwise stated. Performance figures do not reflect deduc- tion of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.

Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, perfor- mance is at net asset value.

The performance of the Fund's share classes will differ primarily due to different sales charge structures and class expenses. Fund performance reflects any applicable

fee waivers and/or expense reimburse- ments. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more informa- tion.

7Invesco Global Real Estate Fund

Invesco Global Real Estate Fund's investment objective is total return through growth of capital and current income.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

About indexes used in this report

￿The MSCI World IndexSM is an unman- aged index considered representative of stocks of developed countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors.

￿The Custom Invesco Global Real Estate Index is composed of the FTSE EPRA/ Nareit Developed Index (gross) from Fund inception through February 17, 2005; the FTSE EPRA/Nareit Developed Index (net) index from February 18, 2005, through June 30, 2014; and the FTSE EPRA/ Nareit Global (net) Index from July 1, 2014.

￿The Lipper Global Real Estate Funds Classification Average represents an av- erage of all funds in the Lipper Global Real Estate Funds classification.

￿The FTSE EPRA/Nareit Developed Index is an unmanaged index considered repre- sentative of global real estate companies and REITs. The index is computed using the net return, which withholds taxes for non-resident investors.

￿The FTSE EPRA/Nareit Global Index is designed to track the performance of listed real estate companies and REITs in both developed and emerging markets. The index is computed using the net re- turn, which withholds taxes for non- resident investors.

￿The Fund is not managed to track the per- formance of any particular index, including the index(es) described here, and conse- quently, 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. Perfor- mance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.

Other information

￿Property type classifications used in this report are generally according to the FTSE National Association of Real Estate Invest- ment Trusts (Nareit) Equity All REITS Index, which is exclusively owned by Na- reit. The FTSE Nareit Equity All REITS Index is an unmanaged index considered representative of US REITs.

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

8Invesco Global Real Estate Fund

Schedule of Investments

February 29, 2020

SharesValue

Common Stocks & Other Equity Interests–98.06%

Australia–3.05%

 

 

 

Charter Hall Long Wale REIT

193,515

$

694,624

Dexus

878,333

 

6,877,267

Goodman Group

384,720

 

3,704,086

GPT Group (The)

503,957

 

1,880,056

Mirvac Group

2,251,693

 

4,405,925

Scentre Group

1,800,004

 

4,009,210

 

 

 

21,571,168

Belgium–0.23%

 

 

 

Cofinimmo S.A.

7,637

 

1,219,904

Montea C.V.A

4,523

 

425,084

 

 

 

1,644,988

Brazil–0.54%

 

 

 

BR Malls Participacoes S.A.

452,276

 

1,652,584

Cyrela Brazil Realty S.A.

 

 

 

Empreendimentos e Participacoes

144,800

 

965,894

Multiplan Empreendimentos

 

 

 

Imobiliarios S.A.

173,300

 

1,182,745

 

 

 

3,801,223

Canada–3.14%

 

 

 

Allied Properties REIT

138,892

 

5,636,392

Canadian Apartment Properties REIT

93,770

 

3,921,259

H&R REIT

103,500

 

1,496,692

Killam Apartment REIT

279,960

 

4,476,023

SmartCentres REIT

236,600

 

5,073,085

Summit Industrial Income REIT

175,400

 

1,659,586

 

 

 

22,263,037

Chile–0.07%

 

 

 

Parque Arauco S.A.

241,920

 

496,914

China–5.80%

 

 

 

Agile Group Holdings Ltd.

1,142,000

 

1,616,568

CapitaLand Retail China Trust

1,214,761

 

1,236,798

China Evergrande Group

875,000

 

1,986,390

China Jinmao Holdings Group Ltd.

2,498,000

 

1,840,086

China Overseas Land & Investment Ltd.

1,345,700

 

4,552,713

China Resources Land Ltd.

1,063,377

 

4,947,153

China SCE Group Holdings Ltd.

2,348,000

 

1,289,792

China Vanke Co. Ltd., H Shares

545,000

 

2,116,059

CIFI Holdings Group Co. Ltd.

3,120,000

 

2,410,657

Guangzhou R&F Properties Co. Ltd., H

 

 

 

Shares

398,800

 

626,688

Logan Property Holdings Co. Ltd.

1,174,000

 

2,021,481

Longfor Group Holdings Ltd.(a)

593,000

 

2,765,736

Powerlong Real Estate Holdings Ltd.

1,155,000

 

726,501

Ronshine China Holdings Ltd.(b)

475,500

 

531,088

Shenzhen Investment Ltd.

1,946,000

 

657,771

Shimao Property Holdings Ltd.

1,304,500

 

4,712,955

Sunac China Holdings Ltd.

828,000

 

4,566,556

Times China Holdings Ltd.

705,000

 

1,317,321

Yuexiu Property Co. Ltd.

5,482,000

 

1,125,597

 

 

 

41,047,910

 

Shares

Value

France–1.70%

 

 

Gecina S.A.

45,597

$ 8,158,636

ICADE

38,613

3,857,443

 

 

12,016,079

Germany–5.78%

 

 

Aroundtown S.A.

658,084

5,695,668

Deutsche Wohnen SE

155,223

6,265,798

Grand City Properties S.A.

253,860

5,950,756

LEG Immobilien AG

27,437

3,278,490

Vonovia SE

367,964

19,766,018

 

 

40,956,730

Hong Kong–5.40%

 

 

CK Asset Holdings Ltd.

1,087,500

6,846,378

Hang Lung Properties Ltd.

2,984,000

6,575,893

Kerry Properties Ltd.

213,500

611,821

Link REIT

684,100

6,371,577

Mapletree North Asia Commercial Trust

712,000

566,443

New World Development Co. Ltd.

5,092,000

6,602,442

Sun Hung Kai Properties Ltd.

676,100

9,682,978

Wharf Holdings Ltd. (The)(c)

466,000

990,199

 

 

38,247,731

India–0.11%

 

 

Oberoi Realty Ltd.

115,818

818,598

Indonesia–0.17%

 

 

PT Bumi Serpong Damai Tbk(b)

3,476,800

244,045

PT Pakuwon Jati Tbk

16,869,500

627,841

PT Summarecon Agung Tbk

5,194,800

306,993

 

 

1,178,879

Japan–10.62%

 

 

Activia Properties, Inc.

907

4,256,773

Comforia Residential REIT, Inc.

1,182

3,620,841

Daiwa House REIT Investment Corp.

1,822

4,551,246

Daiwa Office Investment Corp.

444

3,398,805

Invincible Investment Corp.

3,535

1,412,002

Japan Prime Realty Investment Corp.

784

3,424,371

Japan Real Estate Investment Corp.

941

6,332,955

Japan Rental Housing Investments, Inc.

2,351

2,124,453

Japan Retail Fund Investment Corp.

1,300

2,448,556

LaSalle Logiport REIT

2,323

3,403,854

Mitsui Fudosan Co. Ltd.

384,000

8,895,807

Mitsui Fudosan Logistics Park, Inc.(b)

876

3,881,091

Mori Hills REIT Investment Corp.

1,353

2,127,277

Nippon Accommodations Fund, Inc.

429

2,622,806

Nippon Building Fund, Inc.

849

6,293,224

Nomura Real Estate Holdings, Inc.

148,500

3,234,815

Sumitomo Realty & Development Co. Ltd.

301,200

9,502,678

Tokyu Fudosan Holdings Corp.

576,600

3,627,757

 

 

75,159,311

Malta–0.00%

 

 

BGP Holdings PLC(b)(c)

9,888,325

0

Mexico–0.34%

 

 

Fibra Uno Administracion S.A. de C.V.

384,994

578,772

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco Global Real Estate Fund

 

Shares

Value

Mexico–(continued)

 

 

Macquarie Mexico Real Estate Management

 

 

S.A. de C.V.(a)

901,400

$ 1,196,188

PLA Administradora Industrial, S. de R.L. de

 

 

C.V.

412,200

620,719

 

 

2,395,679

Philippines–0.92%

 

 

Altus San Nicolas Corp.(b)(c)

22,307

2,273

Ayala Land, Inc.

2,911,200

2,235,228

Megaworld Corp.

20,961,200

1,401,224

SM Prime Holdings, Inc.

3,816,200

2,862,216

 

 

6,500,941

Singapore–2.51%

 

 

Ascendas India Trust

691,000

820,444

Ascendas REIT

1,467,100

3,236,040

CapitaLand Ltd.

1,606,700

4,107,367

CapitaLand Mall Trust

132,300

216,919

City Developments Ltd.

444,000

3,112,912

Keppel DC REIT

936,000

1,542,853

Mapletree Commercial Trust

1,888,515

2,869,167

Mapletree Logistics Trust

1,412,500

1,879,001

 

 

17,784,703

South Africa–0.44%

 

 

Growthpoint Properties Ltd.

1,507,567

1,719,877

Redefine Properties Ltd.

2,664,001

928,618

SA Corporate Real Estate Ltd.

3,554,091

475,119

 

 

3,123,614

Spain–1.06%

 

 

Inmobiliaria Colonial SOCIMI S.A.

293,664

3,768,950

Merlin Properties SOCIMI S.A.

290,531

3,748,553

 

 

7,517,503

Sweden–2.14%

 

 

Fabege AB

462,557

7,609,038

Hufvudstaden AB, Class A

98,980

1,780,723

Wihlborgs Fastigheter AB

299,317

5,748,218

 

 

15,137,979

Switzerland–0.98%

 

 

Swiss Prime Site AG(b)

57,429

6,923,974

Thailand–0.47%

 

 

Central Pattana PCL, Foreign Shares

1,971,300

3,315,473

Turkey–0.03%

 

 

Emlak Konut Gayrimenkul Yatirim Ortakligi

 

 

A.S.

903,872

208,720

United Arab Emirates–0.18%

 

 

Emaar Development PJSC

889,578

863,757

Emaar Malls PJSC

893,565

387,142

 

 

1,250,899

United Kingdom–4.13%

 

 

Assura PLC

3,884,996

3,690,612

Big Yellow Group PLC

168,496

2,311,014

Derwent London PLC

68,594

3,485,532

GCP Student Living PLC

745,859

1,814,871

Grainger PLC

446,365

1,694,848

Land Securities Group PLC

495,118

5,330,547

 

Shares

Value

United Kingdom–(continued)

 

 

Segro PLC

424,427

$ 4,492,804

Tritax Big Box REIT PLC

2,068,957

3,467,072

Workspace Group PLC

201,406

2,938,608

 

 

29,225,908

United States–48.25%

 

 

Agree Realty Corp.

94,221

6,766,952

Alexandria Real Estate Equities, Inc.

40,890

6,210,373

American Assets Trust, Inc.

69,056

2,862,371

American Homes 4 Rent, Class A

280,717

7,267,763

Americold Realty Trust

183,067

5,614,665

AvalonBay Communities, Inc.

100,285

20,116,168

Boston Properties, Inc.

217,424

28,034,651

Camden Property Trust

81,267

8,612,677

CareTrust REIT, Inc.

177,508

3,704,592

Crown Castle International Corp.

17,725

2,539,815

CyrusOne, Inc.

67,628

4,096,904

Digital Realty Trust, Inc.

37,582

4,513,974

EastGroup Properties, Inc.

28,631

3,599,776

Empire State Realty Trust, Inc., Class A

32,371

378,741

EPR Properties

90,045

5,334,266

Equity Residential

80,562

6,050,206

Essential Properties Realty Trust, Inc.

110,802

2,538,474

Essex Property Trust, Inc.

1,449

410,589

Extra Space Storage, Inc.

23,314

2,339,793

Federal Realty Investment Trust

43,953

5,113,492

Four Corners Property Trust, Inc.

53,413

1,532,419

Gaming and Leisure Properties, Inc.

116,789

5,216,965

Healthpeak Properties, Inc.

420,083

13,291,426

Hudson Pacific Properties, Inc.

372,393

12,020,846

Invitation Homes, Inc.

441,380

12,663,192

Kilroy Realty Corp.

16,322

1,186,446

Macerich Co. (The)

199,295

4,069,604

Medical Properties Trust, Inc.

222,496

4,701,341

Mid-America Apartment Communities, Inc.

51,024

6,595,362

Omega Healthcare Investors, Inc.

115,869

4,588,412

Park Hotels & Resorts, Inc.

182,813

3,338,165

Pebblebrook Hotel Trust

262,070

5,296,435

Prologis, Inc.

145,946

12,300,329

Public Storage

47,176

9,865,445

QTS Realty Trust, Inc., Class A

82,560

4,637,395

Realty Income Corp.

4,652

336,758

Regency Centers Corp.

10,604

609,094

Retail Opportunity Investments Corp.

179,843

2,697,645

Rexford Industrial Realty, Inc.

132,404

6,192,535

SBA Communications Corp., Class A

7,080

1,876,837

Simon Property Group, Inc.

118,590

14,596,057

STAG Industrial, Inc.

190,103

5,319,082

Sun Communities, Inc.

66,453

10,159,335

Sunstone Hotel Investors, Inc.

336,130

3,680,624

Terreno Realty Corp.

73,489

4,032,341

UDR, Inc.

333,881

15,017,967

Ventas, Inc.

308,946

16,612,026

VEREIT, Inc.

1,636,132

14,168,903

VICI Properties, Inc.

455,850

11,423,601

Vornado Realty Trust

95,845

5,135,375

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco Global Real Estate Fund

 

Shares

Value

United States–(continued)

 

 

Welltower, Inc.

31,503

$ 2,357,056

 

 

341,625,260

Total Common Stocks & Other Equity Interests

 

(Cost $605,943,534)

 

694,213,221

Money Market Funds–1.11%

Invesco Government & Agency Portfolio,

 

 

Institutional Class, 1.50%(d)

2,763,063

2,763,063

Invesco Liquid Assets Portfolio, Institutional

 

 

Class, 1.64%(d)

1,972,828

1,973,814

Investment Abbreviations:

REIT – Real Estate Investment Trust

Notes to Schedule of Investments:

 

 

Shares

 

Value

 

Money Market Funds–(continued)

 

 

Invesco Treasury Portfolio, Institutional

 

 

 

 

Class, 1.48%(d)

3,157,786

$

3,157,786

 

Total Money Market Funds (Cost $7,894,368)

 

7,894,663

TOTAL INVESTMENTS IN SECURITIES—99.17%

 

 

 

 

(Cost $613,837,902)

 

 

702,107,884

OTHER ASSETS LESS LIABILITIES–0.83%

 

 

5,871,050

NET ASSETS–100.00%

 

$707,978,934

(a)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 February 29, 2020 was $3,961,924, which represented less than 1% of the Fund's Net Assets.

(b)Non-income producing security.

(c)Security valued using significant unobservable inputs (Level 3). See Note 3.

(d)The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of February 29, 2020.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco Global Real Estate Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

Investments in securities, at value

 

(Cost $605,943,534)

$694,213,221

Investments in affiliated money market funds, at value

 

(Cost $7,894,368)

7,894,663

Cash

349,187

Foreign currencies, at value (Cost $1,172,892)

1,170,387

Receivable for:

 

Investments sold

21,829,457

Fund shares sold

1,702,839

Dividends

1,261,231

Investment for trustee deferred compensation and

 

retirement plans

153,340

Other assets

19,461

Total assets

728,593,786

Liabilities:

 

Payable for:

 

Investments purchased

18,379,849

Fund shares reacquired

1,646,310

Accrued fees to affiliates

285,181

Accrued trustees' and officers' fees and benefits

3,255

Accrued other operating expenses

130,218

Trustee deferred compensation and retirement plans

170,039

Total liabilities

20,614,852

Net assets applicable to shares outstanding

$707,978,934

Net assets consist of:

 

Shares of beneficial interest

$631,808,565

Distributable earnings

76,170,369

 

$707,978,934

Net Assets:

 

 

Class A

$143,448,335

Class C

$

12,169,004

Class R

$

22,292,579

Class Y

$

166,068,770

Class R5

$164,048,225

Class R6

$199,952,021

Shares outstanding, no par value, with an unlimited number of shares authorized:

Class A

 

12,309,792

Class C

 

1,044,261

Class R

 

1,914,369

Class Y

 

14,253,570

Class R5

 

14,127,943

Class R6

 

17,221,113

Class A:

 

 

Net asset value per share

$

11.65

Maximum offering price per share

 

 

(Net asset value of $11.65 ÷ 94.50%)

$

12.33

Class C:

 

 

Net asset value and offering price per share

$

11.65

Class R:

 

 

Net asset value and offering price per share

$

11.64

Class Y:

 

 

Net asset value and offering price per share

$

11.65

Class R5:

 

 

Net asset value and offering price per share

$

11.61

Class R6:

 

 

Net asset value and offering price per share

$

11.61

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco Global Real Estate Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

 

Dividends (net of foreign withholding taxes of $1,293,431)

$ 24,690,648

 

Dividends from affiliated money market funds

182,094

 

 

Total investment income

24,872,742

 

Expenses:

 

 

 

Advisory fees

5,853,288

 

Administrative services fees

112,728

 

 

Custodian fees

97,776

 

 

Distribution fees:

 

 

 

Class A

391,442

 

 

Class C

140,030

 

 

Class R

122,448

 

 

Transfer agent fees — A, C, R and Y

822,767

 

 

Transfer agent fees — R5

189,402

 

 

Transfer agent fees — R6

20,674

 

 

Trustees' and officers' fees and benefits

27,720

 

 

Registration and filing fees

120,143

 

 

Reports to shareholders

86,109

 

 

Professional services fees

65,457

 

 

Other

25,393

 

 

Total expenses

8,075,377

 

 

Less: Fees waived and/or expense offset arrangement(s)

(13,771)

Net expenses

8,061,606

 

 

Net investment income

16,811,136

 

Realized and unrealized gain (loss) from:

 

 

 

Net realized gain (loss) from:

 

 

 

Investment securities (net of foreign taxes of $136,467)

70,082,890

 

Foreign currencies

(85,920)

 

69,996,970

 

Change in net unrealized appreciation (depreciation) of:

 

 

 

Investment securities (net of foreign taxes of $157,083)

(55,360,616)

Foreign currencies

8,493

 

 

 

(55,352,123)

Net realized and unrealized gain

14,644,847

 

Net increase in net assets resulting from operations

$ 31,455,983

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco Global Real Estate Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

Operations:

 

 

 

 

 

 

Net investment income

$

16,811,136

$

26,532,879

Net realized gain

 

69,996,970

 

62,388,136

Change in net unrealized appreciation (depreciation)

 

(55,352,123)

 

6,376,044

Net increase in net assets resulting from operations

 

31,455,983

 

95,297,059

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

Class A

 

(16,229,157)

 

(14,253,216)

 

 

 

 

 

 

 

Class C

 

(1,318,000)

 

(2,148,367)

 

 

 

 

 

 

 

Class R

 

(2,418,883)

 

(2,314,959)

 

 

 

 

 

 

 

Class Y

 

(20,721,453)

 

(24,652,771)

 

 

 

 

 

 

 

Class R5

 

(19,388,296)

 

(23,113,218)

 

 

 

 

 

 

 

Class R6

 

(23,170,603)

 

(21,000,926)

 

 

 

 

 

 

 

Total distributions from distributable earnings

 

(83,246,392)

 

(87,483,457)

Share transactions–net:

 

 

 

 

 

 

Class A

 

(35,816)

 

(1,637,843)

 

 

 

 

 

 

 

Class C

 

(1,640,150)

 

(12,820,462)

Class R

 

(67,751)

 

570,595

 

Class Y

 

(13,153,212)

 

(443,783,707)

 

 

 

 

 

 

Class R5

 

(33,727,538)

 

(50,509,782)

Class R6

 

7,961,247

 

11,243,127

Net increase (decrease) in net assets resulting from share transactions

 

(40,663,220)

 

(496,938,072)

 

 

 

 

 

 

Net increase (decrease) in net assets

 

(92,453,629)

 

(489,124,470)

Net assets:

 

 

 

 

 

 

Beginning of year

 

800,432,563

 

1,289,557,033

End of year

$707,978,934

$

800,432,563

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

14

Invesco Global Real Estate Fund

Financial Highlights

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

Net gains

 

 

 

 

 

 

 

to average

to average net

 

 

 

 

 

(losses)

 

 

 

 

 

 

 

net assets

assets without

Ratio of net

 

 

Net asset

 

on securities

 

Dividends

Distributions

 

 

 

 

with fee waivers

fee waivers

investment

 

 

value,

Net

(both

Total from

from net

from net

 

Net asset

 

Net assets,

and/or

and/or

income

 

 

beginning

investment

realized and

investment

investment

realized

Total

value, end

Total

end ofperiod

expenses

expenses

to average

Portfolio

 

ofperiod

income(a)

unrealized)

operations

income

gains

distributions

ofperiod

return (b)

(000's omitted)

absorbed

absorbed

net assets

turnover (c)

Class A

 

 

 

 

 

 

 

 

 

 

1.27%(d)

1.27%(d)

1.87%(d)

 

Year ended 02/29/20

$12.59

$0.24

$ 0.22

$ 0.46

$(0.54)

$(0.86)

$(1.40)

$11.65

3.20%

$ 143,448

60%

Year ended 02/28/19

12.76

0.29

0.84

1.13

(0.60)

(0.70)

(1.30)

12.59

9.46

154,173

1.26

1.26

2.26

47

Year ended 02/28/18

12.83

0.30(e)

(0.01)

0.29

(0.28)

(0.08)

(0.36)

12.76

2.17

156,543

1.27

1.27

2.31(e)

51

Year ended 02/28/17

11.94

0.20

1.16

1.36

(0.47)

(0.47)

12.83

11.54

221,942

1.36

1.36

1.54

57

Year ended 02/29/16

13.51

0.19

(1.53)

(1.34)

(0.23)

(0.23)

11.94

(10.00)

254,298

1.43

1.43

1.47

84

Class C

 

 

 

 

 

 

 

 

 

 

2.02(d)

2.02(d)

1.12(d)

60

Year ended 02/29/20

12.59

0.15

0.21

0.36

(0.44)

(0.86)

(1.30)

11.65

2.43

12,169

Year ended 02/28/19

12.75

0.20

0.84

1.04

(0.50)

(0.70)

(1.20)

12.59

8.71

14,673

2.01

2.01

1.51

47

Year ended 02/28/18

12.83

0.21(e)

(0.03)

0.18

(0.18)

(0.08)

(0.26)

12.75

1.33

27,654

2.02

2.02

1.56(e)

51

Year ended 02/28/17

11.95

0.10

1.16

1.26

(0.38)

(0.38)

12.83

10.62

33,299

2.11

2.11

0.79

57

Year ended 02/29/16

13.52

0.09

(1.53)

(1.44)

(0.13)

(0.13)

11.95

(10.67)

36,419

2.18

2.18

0.72

84

Class R

 

 

 

 

 

 

 

 

 

 

1.52(d)

1.52(d)

1.62(d)

60

Year ended 02/29/20

12.58

0.21

0.21

0.42

(0.50)

(0.86)

(1.36)

11.64

2.94

22,293

Year ended 02/28/19

12.75

0.26

0.84

1.10

(0.57)

(0.70)

(1.27)

12.58

9.18

24,003

1.51

1.51

2.01

47

Year ended 02/28/18

12.83

0.27(e)

(0.02)

0.25

(0.25)

(0.08)

(0.33)

12.75

1.84

23,658

1.52

1.52

2.06(e)

51

Year ended 02/28/17

11.95

0.17

1.15

1.32

(0.44)

(0.44)

12.83

11.17

19,718

1.61

1.61

1.29

57

Year ended 02/29/16

13.52

0.16

(1.53)

(1.37)

(0.20)

(0.20)

11.95

(10.22)

17,999

1.68

1.68

1.22

84

Class Y

 

 

 

 

 

 

 

 

 

 

1.02(d)

1.02(d)

2.12(d)

 

Year ended 02/29/20

12.59

0.28

0.21

0.49

(0.57)

(0.86)

(1.43)

11.65

3.46

166,069

60

Year ended 02/28/19

12.76

0.33

0.83

1.16

(0.63)

(0.70)

(1.33)

12.59

9.74

191,757

1.01

1.01

2.51

47

Year ended 02/28/18

12.83

0.34(e)

(0.02)

0.32

(0.31)

(0.08)

(0.39)

12.76

2.42

623,470

1.02

1.02

2.56(e)

51

Year ended 02/28/17

11.95

0.23

1.15

1.38

(0.50)

(0.50)

12.83

11.72

1,167,799

1.11

1.11

1.79

57

Year ended 02/29/16

13.52

0.22

(1.53)

(1.31)

(0.26)

(0.26)

11.95

(9.77)

1,199,430

1.18

1.18

1.72

84

Class R5

 

 

 

 

 

 

 

 

 

 

0.91(d)

0.91(d)

2.23(d)

60

Year ended 02/29/20

12.55

0.29

0.21

0.50

(0.58)

(0.86)

(1.44)

11.61

3.59

164,048

Year ended 02/28/19

12.72

0.34

0.84

1.18

(0.65)

(0.70)

(1.35)

12.55

9.87

208,742

0.92

0.92

2.60

47

Year ended 02/28/18

12.81

0.35(e)

(0.03)

0.32

(0.33)

(0.08)

(0.41)

12.72

2.40

260,397

0.93

0.93

2.65(e)

51

Year ended 02/28/17

11.93

0.26

1.15

1.41

(0.53)

(0.53)

12.81

12.00

264,906

0.88

0.88

2.02

57

Year ended 02/29/16

13.49

0.25

(1.52)

(1.27)

(0.29)

(0.29)

11.93

(9.47)

296,506

0.91

0.91

1.99

84

Class R6

 

 

 

 

 

 

 

 

 

 

0.82(d)

0.82(d)

2.32(d)

 

Year ended 02/29/20

12.55

0.30

0.22

0.52

(0.60)

(0.86)

(1.46)

11.61

3.68

199,952

60

Year ended 02/28/19

12.72

0.35

0.84

1.19

(0.66)

(0.70)

(1.36)

12.55

9.97

207,085

0.83

0.83

2.69

47

Year ended 02/28/18

12.81

0.36(e)

(0.03)

0.33

(0.34)

(0.08)

(0.42)

12.72

2.49

197,835

0.85

0.85

2.73(e)

51

Year ended 02/28/17

11.93

0.27

1.15

1.42

(0.54)

(0.54)

12.81

12.07

54,547

0.81

0.81

2.09

57

Year ended 02/29/16

13.49

0.26

(1.52)

(1.26)

(0.30)

(0.30)

11.93

(9.41)

86,307

0.84

0.84

2.06

84

(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 based on average daily net assets (000's omitted) of $156,577, $14,003, $24,490, $193,694, $189,241 and $213,542 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.

(e)Net investment income per share and the ratio of net investment income to average net assets includes significant dividends received during the year ended February 28, 2018. Net investment income per share and the ratio of net investment income to average net assets excluding the significant dividends are $0.25 and 1.92%, $0.16 and 1.17%, $0.22 and 1.67%, $0.29 and 2.17%, $0.30 and 2.26%, $0.31 and 2.34% 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.

15

Invesco Global Real Estate Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco Global Real Estate Fund (the "Fund"), is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"). The Trust is organized as a Delaware statutory trust and is 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 total return through growth of capital and current income.

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.

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 economic conditions, interest rates, investor perceptions 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 settlement date. 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

16

Invesco Global Real Estate Fund

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.

The Fund recharacterizes distributions received from REIT investments based on information provided by the REIT into the following categories: ordinary income, long-term and short-term capital gains, and return of capital. If information is not available on a timely basis from the REIT, the recharacterization will be based on available information which may include the previous year's allocation. If new or additional information becomes available from the REIT at a later date, a recharacterization will be made in the following year. The Fund records as dividend income the amount recharacterized as ordinary income and as realized gain the amount recharacterized as capital gain in the Statement of Operations, and the amount recharacterized as return of capital as a reduction of the cost of the related investment. These recharacterizations are reflected in the accompanying financial statements.

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, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from 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 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.

17

Invesco Global Real Estate Fund

K.Other Risks - The Fund's investments are concentrated in a comparatively narrow segment of the economy. Consequently, the Fund may tend to be more volatile than other mutual funds, and the value of the Fund's investments may tend to rise and fall more rapidly.

Because the Fund concentrates its assets in the real estate industry, an investment in the Fund will be closely linked to the performance of the real estate markets. Property values may fall due to increasing vacancies or declining rents resulting from economic, legal, cultural or technological developments.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

0.750%

 

 

Next $250 million

0.740%

 

 

Next $500 million

0.730%

Next $1.5 billion

0.720%

 

 

Next $2.5 billion

0.710%

 

 

Next $2.5 billion

0.700%

Next $2.5 billion

0.690%

Over $10 billion

0.680%

 

 

For the year ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.74%.

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, 2020, 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 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, 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; (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, 2020. 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.

The Adviser has contractually agreed, through at least June 30, 2021, 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 year ended February 29, 2020, the Adviser waived advisory fees of $10,373.

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 year ended February 29, 2020, 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 year ended February 29, 2020, 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 year ended February 29, 2020, 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 year ended February 29, 2020, IDI advised the Fund that IDI retained $20,288 in front-end sales commissions from the sale of Class A shares and $377 and $94 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.

18

Invesco Global Real Estate 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 February 29, 2020. 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

$

$

21,571,168

$

$

21,571,168

Belgium

 

 

1,644,988

 

 

1,644,988

Brazil

 

3,801,223

 

 

 

3,801,223

Canada

 

22,263,037

 

 

 

22,263,037

Chile

 

496,914

 

 

 

496,914

China

 

 

41,047,910

 

 

41,047,910

France

 

 

12,016,079

 

 

12,016,079

Germany

 

 

40,956,730

 

 

40,956,730

Hong Kong

 

 

37,257,532

 

990,199

 

38,247,731

India

 

 

818,598

 

 

818,598

Indonesia

 

 

1,178,879

 

 

1,178,879

Japan

 

 

75,159,311

 

 

75,159,311

Malta

 

 

 

0

 

0

Mexico

 

2,395,679

 

 

 

2,395,679

Philippines

 

 

6,498,668

 

2,273

 

6,500,941

Singapore

 

 

17,784,703

 

 

17,784,703

South Africa

 

 

3,123,614

 

 

3,123,614

Spain

 

 

7,517,503

 

 

7,517,503

Sweden

 

 

15,137,979

 

 

15,137,979

Switzerland

 

 

6,923,974

 

 

6,923,974

Thailand

 

3,315,473

 

 

 

3,315,473

Turkey

 

 

208,720

 

 

208,720

United Arab Emirates

 

 

1,250,899

 

 

1,250,899

United Kingdom

 

 

29,225,908

 

 

29,225,908

United States

 

341,625,260

 

 

 

341,625,260

Money Market Funds

 

7,894,663

 

 

 

7,894,663

Total Investments

$381,792,249

$319,323,163

$992,472

$702,107,884

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $3,398.

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

19

Invesco Global Real Estate 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—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 29, 2020 and February 28, 2019:

 

 

2020

 

2019

 

 

Ordinary income

$36,141,284

 

$44,078,531

 

Long-term capital gain

47,105,108

 

43,404,926

 

 

 

 

 

 

 

Total distributions

$83,246,392

 

$87,483,457

 

 

 

 

 

 

 

 

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

 

 

2020

 

 

Undistributed ordinary income

 

$

250,116

 

 

 

 

 

 

Undistributed long-term capital gain

 

 

14,837,069

 

 

 

 

 

 

Net unrealized appreciation — investments

 

 

61,232,081

 

Net unrealized appreciation (depreciation) - foreign currencies

 

 

(4,472)

 

 

 

 

 

Temporary book/tax differences

 

 

(144,425)

 

 

 

 

 

Shares of beneficial interest

 

 

631,808,565

 

Total net assets

 

$707,978,934

 

 

 

 

 

 

 

 

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to wash sales and passive foreign investment companies.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund does not have a capital loss carryforward as of February 29, 2020.

NOTE 8—Investment Transactions

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the year ended February 29, 2020 was $465,940,777 and $577,406,691, 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

$ 93,072,150

 

Aggregate unrealized (depreciation) of investments

(31,840,069)

Net unrealized appreciation of investments

$ 61,232,081

 

Cost of investments for tax purposes is $640,875,803.

NOTE 9—Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of passive foreign investment companies, on February 29, 2020, undistributed net investment income was increased by $15,260,163 and undistributed net realized gain was decreased by $15,260,163. This reclassification had no effect on the net assets or the distributable earnings of the Fund.

NOTE 10—Share Information

 

 

Summary of Share Activity

 

 

Year ended

Year ended

 

February 29, 2020(a)

 

February 28, 2019

 

Shares

Amount

Shares

Amount

Sold:

 

 

 

 

 

Class A

1,760,818

$ 22,777,589

2,261,028

$ 28,724,879

Class C

173,924

2,281,093

280,616

3,445,906

Class R

541,461

7,037,148

508,914

6,562,910

Class Y

3,394,041

43,782,059

7,846,913

102,720,711

Class R5

2,239,175

29,026,282

3,078,116

39,448,509

Class R6

3,369,073

43,574,823

2,447,897

31,729,406

20

Invesco Global Real Estate Fund

 

 

 

Summary of Share Activity

 

 

 

 

 

 

Year ended

 

Year ended

 

 

February 29, 2020(a)

 

 

February 28, 2019

 

 

 

Shares

Amount

 

Shares

 

Amount

Issued as reinvestment of dividends:

 

 

 

 

 

 

 

 

 

 

Class A

1,205,299

$ 14,851,940

1,075,963

$

13,026,819

 

Class C

93,998

1,156,416

160,975

 

1,942,867

 

 

Class R

196,327

2,417,775

191,461

 

2,312,699

 

 

Class Y

1,071,649

13,209,094

1,358,715

 

16,776,278

 

Class R5

1,466,494

18,054,391

1,699,311

 

20,530,863

 

Class R6

1,871,716

23,015,529

1,732,677

 

20,919,474

 

Automatic conversion of Class C shares to Class A shares:

 

 

 

 

 

 

 

 

 

 

Class A

106,558

1,397,846

-

 

-

 

 

Class C

(106,495)

(1,397,846)

-

 

-

 

 

Reacquired:

 

 

 

 

 

 

 

 

 

 

Class A

(3,009,415)

(39,063,191)

(3,361,221)

 

(43,389,541)

 

 

 

 

 

 

 

Class C

(282,806)

(3,679,813)

(1,444,421)

 

(18,209,235)

 

 

 

 

 

 

 

Class R

(731,407)

(9,522,674)

(648,158)

 

(8,305,014)

 

 

 

 

 

 

 

Class Y

(5,446,309)

(70,144,365)

(42,848,838)

 

(563,280,696)

 

 

 

 

 

 

 

Class R5

(6,211,721)

(80,808,211)

(8,613,685)

 

(110,489,154)

 

 

 

 

 

 

 

Class R6

(4,522,828)

(58,629,105)

(3,231,067)

 

(41,405,753)

 

 

 

 

 

 

 

Net increase (decrease) in share activity

(2,820,448)

$(40,663,220)

(37,504,804)

$

(496,938,072)

 

 

 

 

 

 

 

 

 

 

 

(a)There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 52% 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.

NOTE 11—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

21

Invesco Global Real Estate Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Global Real Estate Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Global Real Estate Fund (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the five years in the period ended February 29, 2020 (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the five years in the period ended February 29, 2020 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, Texas

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

22

Invesco Global Real Estate 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 September 1, 2019 through February 29, 2020.

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

 

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

 

Period2

Ratio

Class A

$1,000.00

$976.50

 

$6.04

$1,018.75

 

$6.17

1.23%

 

 

 

 

 

 

 

 

 

Class C

1,000.00

972.70

 

9.71

1,015.02

 

9.92

1.98

 

 

 

 

 

 

 

 

 

Class R

1,000.00

975.20

 

7.27

1,017.50

 

7.42

1.48

 

 

 

 

 

 

 

 

 

Class Y

1,000.00

977.80

 

4.82

1,019.99

 

4.92

0.98

Class R5

1,000.00

978.10

 

4.33

1,020.49

 

4.42

0.88

 

 

 

 

 

 

 

 

 

Class R6

1,000.00

978.60

 

3.89

1,020.93

 

3.97

0.79

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

23

Invesco Global Real Estate Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Federal and State Income Tax

Long-Term Capital Gain Distributions

$47,105,108

Qualified Business Income*

29.01%

Qualified Dividend Income*

23.62%

Corporate Dividends Received Deduction*

0.08%

U.S. Treasury Obligations*

0.00%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

24

Invesco Global Real Estate Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

T-1

Invesco Global Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

 

 

 

 

 

T-2

Invesco Global Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-3

Invesco Global Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-4

Invesco Global Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-5

Invesco Global Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-6

Invesco Global Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

State Street Bank and Trust Company

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

225 Franklin Street

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Boston, MA 02110-2801

T-7

Invesco Global Real Estate Fund

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 holdings four times in each fiscal year, at the quarter-ends. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 033-39519

Invesco Distributors, Inc.

GRE-AR-1

Annual Report to Shareholders

February 29, 2020

Invesco Government Money Market Fund

Nasdaq:

Cash Reserve: AIMXX ￿ AX: ACZXX ￿ CX: ACXXX ￿ Investor: INAXX ￿ R6: INVXX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermedi- ary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports elec- tronically, you will not be affected by this change and you need not take any action. You may elect to receive share- holder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can

call (800) 959-4246 to let the Fund know you wish to con- tinue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

5 Supplemental Information

6 Schedule of Investments

10 Financial Statements

13 Financial Highlights

14 Notes to Financial Statements

18Report of Independent Registered Public Accounting Firm

19Fund Expenses

20Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco Government Money Market Fund

Bruce Crockett

Dear Fellow Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco Government Money Market Fund

Management's Discussion of your Fund

About your Fund

This annual report for Invesco Government Money Market Fund covers the fiscal year ended February 29, 2020. As of that date, the Fund's net assets totaled $2.7 billion. As of the same date, the Fund's weighted aver- age maturity was 17 days and the Fund's weighted average life was 113 days.1

Market conditions affecting money market funds

The largest development affecting money market funds and the money market fund industry during the fiscal year was the US Federal Reserve (the Fed) cutting interest rates three times from a range of 2.25%- 2.50% to 1.50%-1.75%². In the beginning of 2020, markets saw an increase in volatility as a result of the impact of the Coronavirus (COVID-19). This has caused the outlook for the Fed to shift from a neutral policy during 2020 to a higher possibility of several rate cuts. Rate cuts by the Fed would likely cause yields on government money market funds to decrease as a result.

Another major development impacting money market funds and the money market industry during the reporting period was the volatility in the short-term funding markets, when repo rates saw a sudden spike. In Octo- ber 2019, the Fed directed the Federal Re- serve Bank of New York Trading Desk (the Desk) to purchase $60 billion per month in short-term Treasury Bills at least into the sec- ond quarter of 2020 to maintain sufficient reserve balances. This resulted in the flatten- ing of the US Treasury curve and the stabili- zation of the repurchase agreement opera- tions (repo) markets. The Fed has indicated their commitment to continuing both perma- nent and temporary open market operations in order to maintain stability in the funding markets.

Thank you for investing in Invesco Govern- ment Money Market Fund. We believe our long-term approach to short-term investing makes us a strong partner for investors seek- ing premier liquidity management.

1Weighted average maturity (WAM) is an average of the maturities of all securities held in the port- folio, weighted by each security's percentage of net assets. The days to maturity for WAM is the lower of the stated maturity date or next interest rate reset date. WAM reflects how a portfolio would react to interest rate changes. Weighted average life (WAL) is an average of all the maturities of all securities held in the portfolio, weighted by each security's percentage of net assets. The days to maturity for WAL is the lower of the stated maturity date or next demand feature date. WAL reflects how a portfo-

lio would react to deteriorating credit (widening spreads) or tightening liquidity conditions.

2 Source: US Federal Reserve

Team managed by Invesco Advisers, Inc.

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

Portfolio Composition by Maturity

 

In days, as of 02/29/2020

 

1-7

15.8%

8-30

5.1

31-60

27.5

61-90

8.1

91-180

15.4

181+

28.1

The number of days to maturity of each holding is determined in accordance with the provisions of Rule 2a-7 under the Investment Company Act of 1940.

You could lose money by investing in the Fund. Although the Fund seeks to preserve your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The Fund's sponsor has no legal obligation to provide financial support to the Fund, and you should not expect that the sponsor will provide financial support to the Fund at any time.

4Invesco Government Money Market Fund

Invesco Government Money Market Fund's investment objective is to provide current income consistent with preservation of capital and liquidity.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

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

5Invesco Government Money Market Fund

Schedule of Investments

February 29, 2020

 

 

 

Principal

 

 

 

 

 

 

 

 

 

Interest

Maturity

 

Amount

 

 

 

Rate

Date

 

(000)

 

Value

U.S. Government Sponsored Agency Securities-34.39%

 

 

 

 

 

 

Federal Farm Credit Bank (FFCB)-1.14%

 

 

 

 

 

 

Federal Farm Credit Bank (1 mo. USD LIBOR - 0.06%)(a)

1.52%

07/29/2020

$

20,000

$

19,999,010

Federal Farm Credit Bank (1 mo. USD LIBOR + 0.08%)(a)

1.66%

02/01/2021

 

5,000

 

5,004,107

Federal Farm Credit Bank (SOFR + 0.08%)(a)

2.07%

06/10/2021

 

2,000

 

2,000,000

Federal Farm Credit Bank (SOFR + 0.08%)(a)

1.72%

07/09/2021

 

4,000

 

4,000,000

 

 

 

 

 

 

31,003,117

Federal Home Loan Bank (FHLB)-26.04%

 

 

 

 

 

 

Federal Home Loan Bank (SOFR + 0.03%)(a)

1.67%

03/06/2020

 

25,000

 

25,000,000

Federal Home Loan Bank (b)

1.57%

04/01/2020

 

52,000

 

51,929,923

Federal Home Loan Bank (1 mo. USD LIBOR - 0.07%)(a)

1.60%

04/06/2020

 

40,000

 

40,000,000

Federal Home Loan Bank (b)

1.45%

04/15/2020

 

3,000

 

2,994,562

Federal Home Loan Bank (b)

1.58%

04/20/2020

 

4,970

 

4,959,093

Federal Home Loan Bank (b)

1.58%

04/22/2020

 

5,000

 

4,988,589

Federal Home Loan Bank (b)

1.41%

04/24/2020

 

7,000

 

6,985,195

Federal Home Loan Bank (1 mo. USD LIBOR - 0.06%)(a)

1.54%

04/28/2020

 

45,000

 

45,000,000

Federal Home Loan Bank (1 mo. USD LIBOR + 0.05%)(a)

1.63%

05/01/2020

 

10,000

 

10,001,832

Federal Home Loan Bank (SOFR + 0.04%)(a)

1.68%

05/08/2020

 

7,000

 

7,000,000

Federal Home Loan Bank (SOFR + 0.08%)(a)

1.72%

05/11/2020

 

15,000

 

15,000,000

Federal Home Loan Bank (SOFR + 0.02%)(a)

1.66%

05/22/2020

 

25,000

 

25,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.22%)(a)

1.67%

06/08/2020

 

25,000

 

25,000,000

Federal Home Loan Bank (1 mo. USD LIBOR - 0.06%)(a)

1.61%

06/09/2020

 

20,000

 

20,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.22%)(a)

1.67%

06/09/2020

 

15,000

 

15,000,000

Federal Home Loan Bank (1 mo. USD LIBOR - 0.06%)(a)

1.61%

06/10/2020

 

20,000

 

20,000,000

Federal Home Loan Bank (1 mo. USD LIBOR - 0.07%)(a)

1.59%

06/12/2020

 

20,000

 

20,000,000

Federal Home Loan Bank (SOFR + 0.04%)(a)

1.68%

06/19/2020

 

10,000

 

10,000,000

Federal Home Loan Bank (b)

1.58%

07/06/2020

 

15,000

 

14,916,974

Federal Home Loan Bank (1 mo. USD LIBOR - 0.07%)(a)

1.59%

07/13/2020

 

15,000

 

15,000,000

Federal Home Loan Bank (1 mo. USD LIBOR - 0.07%)(a)

1.59%

07/16/2020

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.10%)(a)

1.65%

07/17/2020

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.03%)(a)

1.67%

07/17/2020

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.08%)(a)

1.72%

07/24/2020

 

5,000

 

5,000,000

Federal Home Loan Bank (1 mo. USD LIBOR - 0.06%)(a)

1.60%

08/13/2020

 

15,000

 

15,000,000

Federal Home Loan Bank (b)

1.50%

08/19/2020

 

5,475

 

5,436,251

Federal Home Loan Bank (SOFR + 0.02%)(a)

1.66%

08/19/2020

 

50,000

 

50,000,000

Federal Home Loan Bank (SOFR + 0.03%)(a)

1.67%

08/21/2020

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.02%)(a)

1.66%

08/28/2020

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.05%)(a)

2.08%

09/28/2020

 

15,000

 

15,000,000

Federal Home Loan Bank (1 mo. USD LIBOR - 0.05%)(a)

1.61%

10/15/2020

 

30,000

 

30,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.21%)(a)

1.64%

10/16/2020

 

5,000

 

5,000,000

Federal Home Loan Bank (SOFR + 0.03%)(a)

1.67%

11/06/2020

 

4,000

 

4,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.19%)(a)

1.65%

11/16/2020

 

10,000

 

10,000,000

Federal Home Loan Bank (1 mo. USD LIBOR - 0.04%)(a)

1.62%

12/18/2020

 

5,000

 

5,000,000

Federal Home Loan Bank (SOFR + 0.10%)(a)

4.48%

12/23/2020

 

16,000

 

16,000,000

Federal Home Loan Bank (SOFR + 0.05%)(a)

1.69%

01/22/2021

 

5,000

 

5,000,000

Federal Home Loan Bank (SOFR + 0.05%)(a)

1.69%

01/28/2021

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.04%)(a)

1.68%

02/09/2021

 

15,000

 

15,000,000

Federal Home Loan Bank (SOFR + 0.04%)(a)

1.68%

02/25/2021

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.07%)(a)

1.71%

02/26/2021

 

14,000

 

14,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.11%)(a)

1.77%

04/09/2021

 

7,000

 

7,000,000

Federal Home Loan Bank (SOFR + 0.17%)(a)

1.81%

04/09/2021

 

14,000

 

14,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.11%)(a)

1.74%

04/13/2021

 

5,000

 

5,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.14%)(a)

1.70%

04/14/2021

 

12,000

 

12,000,000

Federal Home Loan Bank (3 mo. USD LIBOR - 0.14%)(a)

1.70%

04/19/2021

 

10,000

 

10,000,000

Federal Home Loan Bank (SOFR + 0.08%)(a)

1.72%

07/23/2021

 

10,000

 

10,000,000

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

6Invesco Government Money Market Fund

 

 

 

 

Principal

 

 

 

Interest

Maturity

 

Amount

 

 

 

Rate

Date

 

(000)

 

Value

Federal Home Loan Bank (FHLB)-(continued)

 

 

 

 

 

 

Federal Home Loan Bank (SOFR + 0.09%)(a)

1.73%

09/10/2021

$

5,000

$

5,000,000

 

 

 

 

 

 

706,212,419

Federal Home Loan Mortgage Corp. (FHLMC)-5.38%

 

 

 

 

 

 

Federal Home Loan Mortgage Corp. (SOFR + 0.04%)(a)

1.68%

04/03/2020

 

25,000

 

25,000,000

Federal Home Loan Mortgage Corp. (SOFR + 0.02%)(a)

1.66%

07/08/2020

 

25,000

 

25,000,000

Federal Home Loan Mortgage Corp. (SOFR + 0.02%)(a)

2.28%

07/10/2020

 

10,000

 

9,999,254

Federal Home Loan Mortgage Corp. (SOFR + 0.01%)(a)

1.65%

07/22/2020

 

15,000

 

15,000,000

Federal Home Loan Mortgage Corp. (SOFR + 0.04%)(a)

1.68%

09/10/2020

 

15,000

 

15,000,000

Federal Home Loan Mortgage Corp. (SOFR + 0.04%)(a)

1.68%

12/14/2020

 

15,000

 

15,000,000

Federal Home Loan Mortgage Corp. (SOFR + 0.03%)(a)

3.48%

02/05/2021

 

7,000

 

7,000,000

Federal Home Loan Mortgage Corp. (SOFR + 0.03%)(a)

1.67%

02/19/2021

 

4,000

 

4,000,000

Federal Home Loan Mortgage Corp. (SOFR + 0.03%)(a)

1.67%

02/24/2021

 

30,000

 

30,000,000

 

 

 

 

 

 

145,999,254

Federal National Mortgage Association (FNMA)-0.88%

 

 

 

 

 

 

Federal National Mortgage Association (b)

1.51%

06/12/2020

 

10,000

 

9,957,083

Federal National Mortgage Association (SOFR + 0.06%)(a)

1.70%

07/30/2020

 

4,000

 

4,000,000

Federal National Mortgage Association (SOFR + 0.04%)(a)

1.68%

01/29/2021

 

10,000

 

10,000,000

 

 

 

 

 

 

23,957,083

U.S. International Development Finance Corp. (DFC)-0.95%

 

 

 

 

 

 

U.S. International Development Finance Corp. VRD Bonds (3 mo. U.S. Treasury Bill Rate)(c)

1.60%

06/15/2025

 

5,000

 

5,000,000

U.S. International Development Finance Corp. VRD Bonds (3 mo. U.S. Treasury Bill Rate)(c)

1.48%

02/15/2028

 

8,636

 

8,636,400

U.S. International Development Finance Corp. VRD Bonds (3 mo. U.S. Treasury Bill Rate)(c)

1.60%

02/15/2028

 

8,889

 

8,888,889

U.S. International Development Finance Corp. VRD Bonds (3 mo. U.S. Treasury Bill Rate)(c)

1.48%

10/15/2040

 

3,200

 

3,200,000

 

 

 

 

 

 

25,725,289

Total U.S. Government Sponsored Agency Securities (Cost $932,897,162)

 

 

 

 

 

932,897,162

U.S. Treasury Securities-20.10%

 

 

 

 

 

 

U.S. Treasury Bills-8.64%(b)

 

 

 

 

 

 

U.S. Treasury Bills

1.57%

03/05/2020

 

35,000

 

34,993,933

U.S. Treasury Bills

1.55%

03/19/2020

 

30,000

 

29,976,900

U.S. Treasury Bills

1.56%

03/26/2020

 

20,000

 

19,978,403

U.S. Treasury Bills

1.81%

04/02/2020

 

20,000

 

19,968,089

U.S. Treasury Bills

1.69%

04/09/2020

 

15,000

 

14,972,700

U.S. Treasury Bills

1.63%

04/16/2020

 

10,000

 

9,979,300

U.S. Treasury Bills

1.61%

04/23/2020

 

5,000

 

4,988,222

U.S. Treasury Bills

1.62%

04/30/2020

 

25,000

 

24,932,917

U.S. Treasury Bills

1.58%

06/25/2020

 

20,000

 

19,898,822

U.S. Treasury Bills

1.57%

07/02/2020

 

25,000

 

24,866,750

U.S. Treasury Bills

1.52%

08/20/2020

 

10,000

 

9,927,856

U.S. Treasury Bills

1.45%

08/27/2020

 

10,000

 

9,928,400

U.S. Treasury Bills

1.47%

12/31/2020

 

10,000

 

9,876,941

 

 

 

 

 

 

234,289,233

U.S. Treasury Notes-11.46%

 

 

 

 

 

 

U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate +

 

 

 

 

 

 

0.04%)(a)

1.20%

07/31/2020

 

7,000

 

6,999,782

U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate +

 

 

 

 

 

 

0.05%)(a)

1.20%

10/31/2020

 

62,000

 

61,984,954

U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate +

 

 

 

 

 

 

0.12%)(a)

1.27%

01/31/2021

 

88,000

 

87,975,413

U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate +

 

 

 

 

 

 

0.14%)(a)

1.30%

04/30/2021

 

82,000

 

81,978,263

U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate +

 

 

 

 

 

 

0.22%)(a)

1.38%

07/31/2021

 

17,000

 

16,997,483

U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate +

 

 

 

 

 

 

0.30%)(a)

1.46%

10/31/2021

 

25,000

 

25,013,210

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

7Invesco Government Money Market Fund

 

 

 

 

Principal

 

 

 

Interest

Maturity

 

Amount

 

 

 

Rate

Date

 

(000)

 

Value

U.S. Treasury Notes-(continued)

 

 

 

 

 

 

U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate +

 

 

 

 

 

 

0.15%)(a)

1.31%

01/31/2022

$

5,000

$

4,998,378

U.S. Treasury Notes

1.38%

09/15/2020

 

10,000

 

9,993,808

U.S. Treasury Notes

2.75%

09/30/2020

 

15,000

 

15,113,826

 

 

 

 

 

 

311,055,117

Total U.S. Treasury Securities (Cost $545,344,350)

 

 

 

 

 

545,344,350

TOTAL INVESTMENTS IN SECURITIES (excluding Repurchase Agreements)-54.49%

 

 

 

 

 

 

(Cost $1,478,241,512)

 

 

 

 

 

1,478,241,512

 

 

 

 

Repurchase

 

 

Repurchase Agreements-43.64%(d)

 

 

 

Amount

 

 

 

 

 

 

 

 

ABN AMRO Bank N.V., joint agreement dated 02/28/2020, aggregate maturing value of

 

 

 

 

 

 

$600,080,500 (collateralized by domestic agency mortgage-backed securities valued at

 

 

 

 

 

 

$612,000,000; 1.50% - 4.50%; 01/01/2024 - 10/20/2049)

1.61%

03/02/2020

 

50,006,708

 

50,000,000

Bank of Montreal, joint term agreement dated 02/12/2020, aggregate maturing value of

 

 

 

 

 

 

$250,998,472 (collateralized by U.S. Treasury obligations valued at $255,000,182;

 

 

 

 

 

 

0% - 3.88%; 05/31/2020 - 11/15/2049)(e)

1.58%

05/14/2020

 

20,079,878

 

20,000,000

Bank of Montreal, joint term agreement dated 02/12/2020, aggregate maturing value of

 

 

 

 

 

 

$251,011,111 (collateralized by domestic agency mortgage-backed securities valued at

 

 

 

 

 

 

$255,000,002; 3.00% - 4.00%; 10/01/2048 - 02/01/2050)(e)

1.60%

05/14/2020

 

20,080,889

 

20,000,000

BMO Capital Markets Corp., joint term agreement dated 01/15/2020, aggregate maturing

 

 

 

 

 

 

value of $502,040,833 (collateralized by U.S. Treasury obligations valued at

 

 

 

 

 

 

$510,000,136; 0% - 8.75%; 02/29/2020 - 02/15/2050)(e)

1.58%

04/17/2020

 

25,102,042

 

25,000,000

BMO Capital Markets Corp., term agreement dated 01/13/2020, maturing value of

 

 

 

 

 

 

$40,158,744 (collateralized by a U.S. government sponsored agency obligation and

 

 

 

 

 

 

domestic agency mortgage-backed securities valued at $40,800,000; 2.50% - 7.00%;

 

 

 

 

 

 

04/03/2024 - 09/15/2061)(e)

1.57%

04/13/2020

 

40,158,744

 

40,000,000

BNP Paribas Securities Corp., joint term agreement dated 01/08/2020, aggregate maturing

 

 

 

 

 

 

value of $1,003,950,000 (collateralized by U.S. Treasury obligations valued at

 

 

 

 

 

 

$1,020,000,183; 0% - 8.75%; 03/05/2020 - 11/15/2049)(e)

1.58%

04/07/2020

 

50,197,500

 

50,000,000

BNP Paribas Securities Corp., joint term agreement dated 01/08/2020, aggregate maturing

 

 

 

 

 

 

value of $2,364,361,125 (collateralized by U.S. Treasury obligations, a U.S. government

 

 

 

 

 

 

sponsored agency obligation and domestic agency mortgage-backed securities valued at

 

 

 

 

 

 

$2,402,100,000; 0% - 8.75%; 04/02/2020 - 02/25/2050)(e)

1.59%

04/07/2020

 

155,616,125

 

155,000,000

BNP Paribas Securities Corp., term agreement dated 12/04/2019, maturing value of

 

 

 

 

 

 

$31,126,325 (collateralized by U.S. Treasury obligations and domestic agency

 

 

 

 

 

 

mortgage-backed securities valued at $31,620,000; 0% - 5.50%; 02/15/2021 -

 

 

 

 

 

 

10/01/2049)(e)

1.63%

03/03/2020

 

31,126,325

 

31,000,000

CIBC World Markets Corp., joint term agreement dated 02/13/2020, aggregate maturing

 

 

 

 

 

 

value of $582,126,183 (collateralized by U.S. Treasury obligations valued at

 

 

 

 

 

 

$591,600,183; 0.13% - 3.63%; 12/31/2020 - 11/15/2046)(e)

1.59%

05/06/2020

 

30,109,975

 

30,000,000

CIBC World Markets Corp., term agreement dated 02/13/2020, maturing value of

 

 

 

 

 

 

$125,311,111 (collateralized by domestic agency mortgage-backed securities valued at

 

 

 

 

 

 

$127,500,000; 3.00% - 6.00%; 05/01/2028 - 02/01/2057)(e)

1.60%

04/09/2020

 

125,311,111

 

125,000,000

Credit Agricole Corporate & Investment Bank, joint term agreement dated 12/23/2019,

 

 

 

 

 

 

aggregate maturing value of $1,004,044,444 (collateralized by U.S. Treasury obligations

 

 

 

 

 

 

valued at $1,020,000,074; 0.40% - 2.88%; 11/15/2021 - 01/15/2027)(e)

1.60%

03/23/2020

 

15,060,667

 

15,000,000

ING Financial Markets, LLC, joint term agreement dated 02/10/2020, aggregate maturing

 

 

 

 

 

 

value of $100,135,000 (collateralized by domestic agency mortgage-backed securities

 

 

 

 

 

 

valued at $102,000,000; 2.50% - 5.50%; 03/01/2029 - 09/01/2057)

1.62%

03/11/2020

 

7,009,450

 

7,000,000

ING Financial Markets, LLC, term agreement dated 02/18/2020, maturing value of

 

 

 

 

 

 

$68,282,200 (collateralized by domestic agency mortgage-backed securities valued at

 

 

 

 

 

 

$69,360,000; 2.31% - 6.50%; 01/01/2024 - 05/01/2058)

1.66%

05/18/2020

 

68,282,200

 

68,000,000

J.P. Morgan Securities LLC, joint agreement dated 02/28/2020, aggregate maturing value of

 

 

 

 

 

 

$500,067,083 (collateralized by domestic agency mortgage-backed securities and U.S.

 

 

 

 

 

 

goverment sponsored agency obligations valued at $510,000,000; 0% - 6.00%;

 

 

 

 

 

 

12/01/2027 - 03/01/2050)

1.61%

03/02/2020

 

50,006,708

 

50,000,000

J.P. Morgan Securities LLC, joint open agreement dated 05/02/2019 (collateralized by

 

 

 

 

 

 

domestic agency mortgage-backed securities and a U.S. Treasury obligation valued at

 

 

 

 

 

 

$510,000,063; 0% - 6.00%; 06/01/2023 - 03/01/2050)(f)

1.59%

-

 

-

 

28,000,000

J.P. Morgan Securities LLC, joint open agreement dated 05/15/2019 (collateralized by

 

 

 

 

 

 

domestic agency mortgage-backed securities and a U.S. Treasury obligation valued at

 

 

 

 

 

 

$295,800,032; 0% - 7.00%; 08/01/2021 - 03/01/2050)(f)

1.63%

-

 

-

 

15,000,000

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

8Invesco Government Money Market Fund

 

 

Interest

Maturity

 

Repurchase

 

 

 

Rate

Date

 

Amount

Value

J.P. Morgan Securities LLC, joint open agreement dated 07/18/2019 (collateralized by

 

 

 

 

 

U.S. Treasury obligations valued at $357,000,087; 0% - 4.75%; 02/29/2020 -

 

 

 

 

 

11/15/2048)(f)

1.57%

-

$

- $

15,000,000

J.P. Morgan Securities LLC, joint open agreement dated 10/15/2019 (collateralized by

 

 

 

 

 

domestic agency mortgage-backed securities and a U.S. Treasury obligation valued at

 

 

 

 

 

$408,000,056; 0% - 6.00%; 05/01/2024 - 02/20/2050)(f)

1.60%

-

 

-

25,000,000

J.P. Morgan Securities LLC, joint term agreement dated 12/04/2019, aggregate maturing

 

 

 

 

 

value of $572,000,000 (collateralized by U.S. Treasury obligations valued at

 

 

 

 

 

$583,440,393; 0% - 3.00%; 04/14/2020 - 02/15/2048)(a)(e)

1.61%

03/04/2020

 

35,000,000

35,000,000

Metropolitan Life Insurance Co., joint term agreement dated 02/25/2020, aggregate

 

 

 

 

 

maturing value of $350,117,559 (collateralized by U.S. Treasury obligations valued at

 

 

 

 

 

$367,166,166; 0% - 2.63%; 03/26/2020 - 05/15/2046)(e)

1.61%

03/03/2020

 

25,009,264

25,001,438

Mitsubishi UFJ Trust & Banking Corp., joint term agreement dated 02/27/2020, aggregate

 

 

 

 

 

maturing value of $1,022,822,087 (collateralized by U.S. Treasury obligations valued at

 

 

 

 

 

$1,050,853,400; 2.00%; 04/30/2024)(e)

1.62%

03/05/2020

 

61,369,325

61,350,000

Mitsubishi UFJ Trust & Banking Corp., joint term agreement dated 02/27/2020, aggregate

 

 

 

 

 

maturing value of $100,031,306 (collateralized by U.S. Treasury obligations valued at

 

 

 

 

 

$102,009,376; 2.63%; 02/15/2029)(e)

1.61%

03/05/2020

 

25,007,826

25,000,000

RBC Capital Markets LLC, joint agreement dated 02/28/2020, aggregate maturing value of

 

 

 

 

 

$100,013,417 (collateralized by domestic agency mortgage-backed securities and U.S.

 

 

 

 

 

goverment sponsored agency obligations valued at $102,000,001; 2.05% - 5.00%;

 

 

 

 

 

07/25/2024 - 07/01/2042)

1.61%

03/02/2020

 

50,006,708

50,000,000

RBC Capital Markets LLC, joint term agreement dated 02/28/2020, aggregate maturing value

 

 

 

 

 

of $1,250,000,000 (collateralized by domestic agency mortgage-backed securities, U.S.

 

 

 

 

 

goverment sponsored agency obligations and a foreign corporate obligation valued at

 

 

 

 

 

$1,275,000,001; 1.70% - 8.00%; 06/15/2021 - 02/20/2067)(a)(e)

1.64%

04/29/2020

 

85,000,000

85,000,000

RBC Dominion Securities Inc., joint term agreement dated 02/07/2020, aggregate maturing

 

 

 

 

 

value of $350,954,819 (collateralized by domestic agency mortgage-backed securities,

 

 

 

 

 

U.S. government sponsored agency obligations and U.S. Treasury obligations valued at

 

 

 

 

 

$357,000,003; 0% - 5.00%; 01/28/2021 - 02/20/2050)(e)

1.61%

04/08/2020

 

25,068,201

25,000,000

Royal Bank of Canada, joint term agreement dated 12/20/2019, aggregate maturing value of

 

 

 

 

 

$1,004,000,000 (collateralized by domestic agency mortgage-backed securities valued

 

 

 

 

 

at $1,020,000,001; 1.93% - 6.00%; 01/25/2029 - 02/01/2050)(e)

1.60%

03/19/2020

 

60,240,000

60,000,000

Societe Generale, joint open agreement dated 06/25/2018 (collateralized by U.S. Treasury

 

 

 

 

 

obligations and domestic agency mortgage-backed securities valued at $510,000,011;

 

 

 

 

 

0% - 4.00%; 08/27/2020 - 01/01/2050)(f)

1.61%

-

 

-

15,000,000

Wells Fargo Securities, LLC, joint agreement dated 02/28/2020, aggregate maturing value of

 

 

 

 

 

$500,066,250 (collateralized by U.S. Treasury obligations valued at $510,000,001;

 

 

 

 

 

0% - 2.88%; 03/05/2020 - 03/31/2026)

1.59%

03/02/2020

 

33,416,868

33,412,441

 

Total Repurchase Agreements (Cost $1,183,763,879)

 

 

 

 

1,183,763,879

TOTAL INVESTMENTS IN SECURITIES(g)-98.13% (Cost $2,662,005,391)

 

 

 

 

2,662,005,391

OTHER ASSETS LESS LIABILITIES-1.87%

 

 

 

 

50,602,668

NET ASSETS-100.00%

 

 

 

$

2,712,608,059

Investment Abbreviations:

 

 

 

 

 

LIBOR -London Interbank Offered Rate

 

 

 

 

 

SOFR

-Secured Overnight Financing Rate

 

 

 

 

 

USD

-U.S. Dollar

 

 

 

 

 

VRD

-Variable Rate Demand

 

 

 

 

 

Notes to Schedule of Investments:

(a)Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on February 29, 2020.

(b)Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund.

(c)Demand security payable upon demand by the Fund at specified time intervals no greater than thirteen months. Interest rate is redetermined periodically based on current market interest rates. Rate shown is the rate in effect on February 29, 2020.

(d)Principal amount equals value at period end. See Note 1I.

(e)The Fund may demand payment of the term repurchase agreement upon one to seven business days' notice depending on the timing of the demand.

(f)Either party may terminate the agreement upon demand. Interest rates, principal amount and collateral are redetermined daily.

(g)Also represents cost for federal income tax purposes.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco Government Money Market Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

Investments in securities, excluding repurchase

 

agreements, at value and cost

$1,478,241,512

Repurchase agreements, at value and cost

1,183,763,879

Cash

11,380,715

Receivable for:

 

Fund shares sold

57,883,225

Interest

3,292,266

Investment for trustee deferred compensation and

 

retirement plans

242,040

Other assets

3,887

Total assets

2,734,807,524

Liabilities:

 

Payable for:

 

Fund shares reacquired

20,639,016

Dividends

61,023

Accrued fees to affiliates

1,192,580

Accrued trustees' and officers' fees and benefits

6,046

Accrued operating expenses

27,943

Trustee deferred compensation and retirement plans

272,857

Total liabilities

22,199,465

Net assets applicable to shares outstanding

$2,712,608,059

Net assets consist of:

 

Shares of beneficial interest

$2,712,360,175

Distributable earnings

247,884

 

$2,712,608,059

Net Assets:

 

 

Invesco Cash Reserve Shares

$

2,406,243,050

Class AX

$

76,169,436

Class C

$

43,478,364

Class CX

$

506,572

Class R

$

32,296,515

Class Y

$

42,686,006

Investor Class

$

111,207,901

Class R6

$

20,215

Shares outstanding, no par value,

 

 

unlimited number of shares authorized:

 

 

Invesco Cash Reserve Shares

 

2,406,268,494

Class AX

 

76,169,869

Class C

 

43,478,602

Class CX

 

506,575

Class R

 

32,296,656

Class Y

 

42,686,177

Investor Class

 

111,208,390

Class R6

 

20,215

Net asset value and offering price per share for each

 

 

class

$

1.00

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco Government Money Market Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

Interest

$46,720,762

 

Expenses:

 

 

Advisory fees

3,399,376

 

Administrative services fees

1,003,816

 

Custodian fees

3,355

 

Distribution fees:

 

 

Invesco Cash Reserve Shares

2,948,013

 

Class AX

118,367

 

Class C

380,821

 

Class CX

5,258

 

Class R

122,037

 

Transfer agent fees - Invesco Cash Reserve Shares, AX, C, CX, R, Y and Investor

3,333,596

 

Transfer agent fees - R6

21

 

Trustees' and officers' fees and benefits

46,501

 

Registration and filing fees

397,071

 

Reports to shareholders

33,917

 

Professional services fees

12,807

 

Other

14,155

 

Total expenses

11,819,111

 

Less: Expense offset arrangement(s)

(30,425)

Net expenses

11,788,686

 

Net investment income

34,932,076

 

Net realized gain from investment securities

9,188

 

Net increase in net assets resulting from operations

$34,941,264

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco Government Money Market Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

Operations:

 

 

 

 

 

 

Net investment income

$

34,932,076

$

19,320,432

 

Net realized gain (loss)

 

9,188

 

(1,472)

Net increase in net assets resulting from operations

 

34,941,264

 

19,318,960

 

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

Invesco Cash Reserve Shares

 

(30,342,270)

 

(14,729,147)

 

 

 

 

 

 

Class AX

 

(1,262,786)

 

(1,281,740)

 

 

 

 

 

 

Class C

 

(350,056)

 

(458,067)

 

 

 

 

 

 

Class CX

 

(5,071)

 

(25,911)

 

 

 

 

 

 

Class R

 

(402,873)

 

(328,797)

 

 

 

 

 

 

Class Y

 

(572,434)

 

(524,759)

 

 

 

 

 

 

Investor Class

 

(2,011,585)

 

(1,971,836)

 

 

 

 

 

 

Class R6

 

(343)

 

(183)

 

 

 

 

 

 

Total distributions from distributable earnings

 

(34,947,418)

 

(19,320,440)

Share transactions-net:

 

 

 

 

 

 

Invesco Cash Reserve Shares

 

1,106,837,803

 

483,786,108

 

Class AX

 

(4,941,382)

 

(10,796,325)

 

 

 

 

 

 

Class C

 

4,777,928

 

(26,711,159)

 

 

 

 

 

 

Class CX

 

(162,552)

 

(3,444,863)

 

 

 

 

 

 

Class R

 

6,425,067

 

(1,515,629)

Class Y

 

8,581,230

 

4,024,953

 

Investor Class

 

(14,679,384)

 

8,255,956

 

Class R6

 

8,026

 

2,189

 

 

Net increase in net assets resulting from share transactions

 

1,106,846,736

 

453,601,230

 

Net increase in net assets

 

1,106,840,582

 

453,599,750

 

Net assets:

 

 

 

 

 

 

Beginning of year

 

1,605,767,477

 

1,152,167,727

 

End of year

$2,712,608,059

$

1,605,767,477

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco Government Money Market Fund

Financial Highlights

February 29, 2020

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

 

 

 

 

 

 

to average

to average net

Ratio of net

 

Net asset

 

Net gains

 

Dividends

 

 

 

net assets

assets without

investment

 

value,

Net

(losses)

Total from

from net

Net asset

 

Net assets,

with fee waivers

fee waivers

income

 

beginning

investment

on securities

investment

investment

value, end

Total

end of period

and/or expenses

and/or expenses

to average

 

of period

income(a)

(realized)

operations

income

of period

return(b)

(000's omitted)

absorbed

absorbed

net assets

 

Invesco Cash Reserve Shares

 

 

 

 

 

 

 

 

0.51%(c)

0.51%(c)

1.55%(c)

Year ended 02/29/20

$1.00

$0.02

$ 0.00

$0.02

$(0.02)

$1.00

1.61%

$2,406,243

Year ended 02/28/19

1.00

0.02

(0.00)

0.02

(0.02)

1.00

1.50

1,299,414

0.58

0.58

1.52

 

Year ended 02/28/18

1.00

0.00

(0.00)

0.00

(0.00)

1.00

0.40

815,631

0.68

0.68

0.39

 

Year ended 02/28/17

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

841,039

0.43

0.68

0.06

 

Year ended 02/29/16

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

796,108

0.23

0.85

0.05

 

Class AX

 

 

 

 

 

 

 

 

0.51(c)

0.51(c)

1.55(c)

Year ended 02/29/20

1.00

0.02

0.00

0.02

(0.02)

1.00

1.61

76,169

Year ended 02/28/19

1.00

0.02

(0.00)

0.02

(0.02)

1.00

1.50

81,110

0.58

0.58

1.52

 

Year ended 02/28/18

1.00

0.00

(0.00)

0.00

(0.00)

1.00

0.40

91,906

0.68

0.68

0.39

 

Year ended 02/28/17

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

102,748

0.43

0.68

0.06

 

Year ended 02/29/16

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

117,923

0.23

0.85

0.05

 

Class C

 

 

 

 

 

 

 

 

1.26(c)

1.26(c)

0.80(c)

Year ended 02/29/20

1.00

0.01

0.00

0.01

(0.01)

1.00

0.85

43,478

Year ended 02/28/19

1.00

0.01

(0.00)

0.01

(0.01)

1.00

0.76

38,700

1.31

1.33

0.79

 

Year ended 02/28/18

1.00

0.00

(0.00)

0.00

(0.00)

1.00

0.27

65,411

0.81

1.43

0.26

 

Year ended 02/28/17

1.00

0.00

0.00

0.00

(0.00)

1.00

0.05

88,605

0.43

1.43

0.06

 

Year ended 02/29/16

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

90,970

0.23

1.60

0.05

 

Class CX

 

 

 

 

 

 

 

 

1.26(c)

1.26(c)

0.80(c)

Year ended 02/29/20

1.00

0.01

0.00

0.01

(0.01)

1.00

0.85

507

Year ended 02/28/19

1.00

0.01

(0.00)

0.01

(0.01)

1.00

0.77

669

1.31

1.33

0.79

 

Year ended 02/28/18

1.00

0.00

(0.00)

0.00

(0.00)

1.00

0.27

4,114

0.81

1.43

0.26

 

Year ended 02/28/17

1.00

0.00

0.00

0.00

(0.00)

1.00

0.05

4,959

0.43

1.43

0.06

 

Year ended 02/29/16

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

6,509

0.23

1.60

0.05

 

Class R

 

 

 

 

 

 

 

 

0.76(c)

0.76(c)

1.30(c)

Year ended 02/29/20

1.00

0.01

0.00

0.01

(0.01)

1.00

1.35

32,297

Year ended 02/28/19

1.00

0.01

(0.00)

0.01

(0.01)

1.00

1.25

25,871

0.83

0.83

1.27

 

Year ended 02/28/18

1.00

0.00

(0.00)

0.00

(0.00)

1.00

0.27

27,387

0.80

0.93

0.27

 

Year ended 02/28/17

1.00

0.00

0.00

0.00

(0.00)

1.00

0.05

34,794

0.43

0.93

0.06

 

Year ended 02/29/16

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

38,241

0.23

1.10

0.05

 

Class Y

 

 

 

 

 

 

 

 

0.36(c)

0.36(c)

1.70(c)

Year ended 02/29/20

1.00

0.02

0.00

0.02

(0.02)

1.00

1.76

42,686

Year ended 02/28/19

1.00

0.02

(0.00)

0.02

(0.02)

1.00

1.65

34,105

0.43

0.43

1.67

 

Year ended 02/28/18

1.00

0.01

(0.00)

0.01

(0.01)

1.00

0.55

30,080

0.53

0.53

0.54

 

Year ended 02/28/17

1.00

0.00

0.00

0.00

(0.00)

1.00

0.09

27,738

0.40

0.53

0.09

 

Year ended 02/29/16

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

22,602

0.23

0.70

0.05

 

Investor Class

 

 

 

 

 

 

 

 

0.36(c)

0.36(c)

1.70(c)

Year ended 02/29/20

1.00

0.02

0.00

0.02

(0.02)

1.00

1.76

111,208

Year ended 02/28/19

1.00

0.02

(0.00)

0.02

(0.02)

1.00

1.65

125,886

0.43

0.43

1.67

 

Year ended 02/28/18

1.00

0.01

(0.00)

0.01

(0.01)

1.00

0.55

117,630

0.53

0.53

0.54

 

Year ended 02/28/17

1.00

0.00

0.00

0.00

(0.00)

1.00

0.09

123,466

0.40

0.53

0.09

 

Year ended 02/29/16

1.00

0.00

0.00

0.00

(0.00)

1.00

0.06

152,042

0.23

0.70

0.05

 

Class R6

 

 

 

 

 

 

 

 

0.32(c)

0.32(c)

1.74(c)

Year ended 02/29/20

1.00

0.02

0.00

0.02

(0.02)

1.00

1.81

20

Year ended 02/28/19

1.00

0.02

(0.00)

0.02

(0.02)

1.00

1.80

12

0.36

0.38

1.74

 

Year ended 02/28/18(d)

1.00

0.01

(0.00)

0.01

(0.01)

1.00

0.69

10

0.37(e)

0.37(e)

0.70(e)

 

(a)Calculated using average shares outstanding.

(b)Includes adjustments in accordance with accounting principles generally accepted in the United States of America and does not include sales charges and is not annualized for periods less than one year, if applicable.

(c)Ratios are based on average daily net assets (000's omitted) of $1,965,323, $78,911, $42,313, $584, $30,509, $33,715, $114,875, and $21 for Invesco Cash Reserve Shares, Class AX, Class C, Class CX, Class R, Class Y, Investor Class, and Class R6 shares, respectively.

(d)Commencement date of April 04, 2017.

(e)Annualized.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco Government Money Market Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco Government Money Market Fund (the "Fund"), is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities 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 provide current income consistent with preservation of capital and liquidity.

The Fund currently consists of nine different classes of shares: Invesco Cash Reserve Shares, Class A (not yet commenced), Class AX, Class C, Class CX, Class R, Class Y, Investor Class and Class R6. Effective December 10,2019, Class A shares were incepted. Class A, Class AX and Class CX shares are closed to new investors. Class Y and Investor Class shares are available only to certain investors. Class C and Class CX shares are sold with a contingent deferred sales charges ("CDSC"). Invesco Cash Reserve Shares, Class A, Class AX, Class R, Class Y, Investor Class and Class R6 shares are sold at net asset value.

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.

The Fund is a "government money market fund" as defined in Rule 2a-7 under the 1940 Act and seeks to maintain a stable or constant NAV of $1.00 per share using an amortized cost method of valuation. "Government money market funds" are required to invest at least 99.5% of their total assets in cash, Government Securities (as defined in the 1940 Act), and/or repurchase agreements collateralized fully by cash or Government Securities. The Board of Trustees has elected not to subject the Fund to liquidity fee and redemption gate requirements at this time, as permitted by Rule 2a-7.

A.Security Valuations — The Fund's securities are recorded on the basis of amortized cost which approximates value as permitted by Rule 2a-7 under the 1940 Act. This method values a security at its cost on the date of purchase and, thereafter, assumes a constant amortization to maturity of any premiums or accretion of any discounts.

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.

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.

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 the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities.

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 gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized 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 realized capital gains and losses to a class based on the relative net assets of each class. The Fund allocates income to a class based on the relative value of the settled shares 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 are declared daily and paid monthly. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date.

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

14

Invesco Government Money Market Fund

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.Repurchase Agreements - The Fund may enter into repurchase agreements. Collateral on repurchase agreements, including the Fund's pro-rata interest in joint repurchase agreements, is taken into possession by the Fund upon entering into the repurchase agreement. Collateral consisting of U.S. Government Securities and U.S. Government Sponsored Agency Securities is marked to market daily to ensure its market value is at least 102% of the sales price of the repurchase agreement. The investments in some repurchase agreements, pursuant to procedures approved by the Board of Trustees, are through participation with other mutual funds, private accounts and certain non-registered investment companies managed by the investment adviser or its affiliates ("Joint repurchase agreements"). The principal amount of the repurchase agreement is equal to the value at period-end. If the seller of a repurchase agreement fails to repurchase the security in accordance with the terms of the agreement, the Fund might incur expenses in enforcing its rights, and could experience losses, including a decline in the value of the collateral and loss of income.

J.Other Risks - Investments in obligations issued by agencies and instrumentalities of the U.S. Government may vary in the level of support they receive from the government. The government may choose not to provide financial support to government sponsored agencies or instrumentalities if it is not legally obligated to do so. In this case, if the issuer defaulted, the Fund may not be able to recover its investment in such issuer from the U.S. Government.

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 0.15% of the Fund's average daily net assets.

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 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 year ended February 29, 2020, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Also, Invesco has entered into a sub-administration agreement whereby The Bank of New York Mellon ("BNY Mellon") serves as custodian and fund accountant and provides certain administrative services to the Fund.

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 year ended February 29, 2020, 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 IDI to serve as the distributor for the Invesco Cash Reserve Shares, Class AX, Class C, Class CX, 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 Invesco Cash Reserve Shares, Class AX, Class C, Class CX and Class R shares (collectively, the "Plans"). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.15% of the Fund's average daily net assets of Invesco Cash Reserve Shares and Class AX shares, 0.90% of the average daily net assets of Class C and Class CX shares and 0.40% 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 year ended February 29, 2020, expenses incurred under the plans are shown in the Statement of Operations as Distribution fees.

CDSC are not recorded as expenses of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the year ended February 29, 2020, IDI advised the Fund that IDI retained $3,327, $10,933 and $17 from Invesco Cash Reserve Shares, Class C, and Class CX shares, respectively, for CDSC imposed on 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.

As of February 29, 2020, all of the securities in this Fund were valued based on Level 2 inputs (see the Schedule of Investments for security categories). 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.

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $30,425.

15

Invesco Government Money Market 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 BNY Mellon, 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.

NOTE 7—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Years Ended February 29, 2020 and February 28, 2019:

 

 

2020

 

2019

 

 

Ordinary income

$34,947,418

 

$19,320,440

 

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

 

 

2020

 

 

Undistributed ordinary income

 

$

524,928

 

 

 

 

 

 

Temporary book/tax differences

 

 

(234,577)

 

 

 

 

 

Capital loss carryforward

 

 

(42,467)

Shares of beneficial interest

 

 

2,712,360,175

 

 

 

 

 

Total net assets

 

$2,712,608,059

 

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 Funds to utilize. The ability to utilize capital loss carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund has a capital loss carryforward as of February 29, 2020 as follows:

Capital Loss Carryforward

Expiration

Short-Term

Long-Term

Total

Not subject to expiration

$22,196

$20,271

$42,467

 

 

 

 

*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—Share Information

 

 

Summary of Share Activity

 

 

Year ended February 29, 2020(a)

 

Year ended February 28, 2019

 

Shares

Amount

Shares

Amount

Sold:

 

 

 

 

 

Invesco Cash Reserve Shares

3,219,840,068

$ 3,219,840,068

1,625,821,651

$ 1,625,821,651

Class AX

9,084,309

9,084,309

11,117,507

11,117,507

Class C

62,381,745

62,381,745

53,294,381

53,294,381

Class CX

88,034

88,034

74,248

74,248

Class R

26,996,158

26,996,158

10,236,938

10,236,938

Class Y

52,296,157

52,296,157

40,526,564

40,526,564

Investor Class

35,406,235

35,406,235

50,488,673

50,488,673

Class R6

78,922

78,922

2,981

2,981

16

Invesco Government Money Market Fund

 

 

 

Summary of Share Activity

 

 

 

 

Year ended February 29, 2020(a)

 

Year ended February 28, 2019

 

 

Shares

 

Amount

Shares

 

Amount

Issued as reinvestment of dividends:

 

 

 

 

 

 

 

 

Invesco Cash Reserve Shares

27,747,430

$

27,747,430

14,729,147

$

14,729,147

 

Class AX

1,223,418

 

1,223,418

1,281,740

 

1,281,740

 

Class C

330,434

 

330,434

458,067

 

458,067

 

Class CX

4,961

 

4,961

25,507

 

25,507

 

Class R

402,873

 

402,873

328,797

 

328,797

 

Class Y

568,606

 

568,606

524,759

 

524,759

 

Investor Class

1,979,601

 

1,979,601

1,971,836

 

1,971,836

 

Class R6

152

 

152

4

 

4

 

Automatic Conversion of Class C and CX shares to

 

 

 

 

 

 

 

 

Invesco Cash Reserve Shares:

 

 

 

 

 

 

 

 

Invesco Cash Reserve Shares

2,691,606

 

2,691,606

-

 

-

 

Class C

(2,504,019)

 

(2,504,019)

-

 

-

 

Class CX

(187,587)

 

(187,587)

-

 

-

 

Reacquired:

 

 

 

 

 

 

 

 

Invesco Cash Reserve Shares

(2,143,441,301)

 

(2,143,441,301)

(1,156,764,690)

 

(1,156,764,690)

 

 

 

 

 

 

 

 

Class AX

(15,249,109)

 

(15,249,109)

(23,195,572)

 

(23,195,572)

 

 

 

 

 

 

 

 

Class C

(55,430,232)

 

(55,430,232)

(80,463,607)

 

(80,463,607)

 

 

 

 

 

 

 

 

Class CX

(67,960)

 

(67,960)

(3,544,618)

 

(3,544,618)

 

 

 

 

 

 

 

 

Class R

(20,973,964)

 

(20,973,964)

(12,081,364)

 

(12,081,364)

 

 

 

 

 

 

 

 

Class Y

(44,283,533)

 

(44,283,533)

(37,026,370)

 

(37,026,370)

 

 

 

 

 

 

 

 

Investor Class

(52,065,220)

 

(52,065,220)

(44,204,553)

 

(44,204,553)

 

 

 

 

 

 

 

 

Class R6

(71,048)

 

(71,048)

(796)

 

(796)

Net increase in share activity

1,106,846,736

$

1,106,846,736

453,601,230

$

453,601,230

 

(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.

NOTE 9—Significant Event

The Board of Trustees of the Fund unanimously approved an Agreement and Plan of Reorganization (the "Agreement") pursuant to which the Fund would acquire all of the assets and liabilities of Invesco Oppenheimer Government Cash Reserves Fund (the "Target Fund") in exchange for shares of the Fund.

The reorganization is expected to be consummated on or around May 15, 2020. Upon closing of the reorganization, shareholders of the Target Fund will receive shares of the Fund in exchange for their shares of the Target Fund, and the Target Fund will liquidate and cease operations.

NOTE 10—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

17

Invesco Government Money Market Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Government Money Market Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Government Money Market Fund (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the periods indicated therein (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the periods indicated therein in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, TX

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

18

Invesco Government Money Market 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 September 1, 2019 through February 29, 2020.

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

 

 

 

 

ACTUAL

(5% annual return before expenses)

 

 

 

 

 

 

 

 

 

 

Beginning

Ending

 

Expenses

Ending

Expenses

Annualized

 

Account Value

Account Value

 

Paid During

Account Value

Paid During

Expense

Class

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

Period2

Ratio

Invesco Cash Reserve

$1,000.00

$1,006.50

 

$2.39

$1,022.48

$2.41

0.48%

Shares

 

 

 

 

 

 

 

AX

1,000.00

1,006.50

 

2.39

1,022.48

2.41

0.48

 

 

 

 

 

 

 

 

C

1,000.00

1,002.80

 

6.12

1,018.75

6.17

1.23

 

 

 

 

 

 

 

 

CX

1,000.00

1,002.80

 

6.12

1,018.75

6.17

1.23

 

 

 

 

 

 

 

 

R

1,000.00

1,005.30

 

3.64

1,021.23

3.67

0.73

 

 

 

 

 

 

 

 

Y

1,000.00

1,007.30

 

1.65

1,023.22

1.66

0.33

 

 

 

 

 

 

 

 

Investor

1,000.00

1,007.30

 

1.65

1,023.22

1.66

0.33

 

 

 

 

 

 

 

 

R6

1,000.00

1,007.40

 

1.55

1,023.32

1.56

0.31

 

 

 

 

 

 

 

 

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

19

Invesco Government Money Market Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisors.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Federal and State Income Tax

Qualified Dividend Income*

0.00%

Corporate Dividends Received Deduction*

0.00%

U.S. Treasury Obligations*

21.07%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

20

Invesco Government Money Market Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

T-1

Invesco Government Money Market Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

 

 

 

 

 

T-2

Invesco Government Money Market Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-3

Invesco Government Money Market Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-4

Invesco Government Money Market Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-5

Invesco Government Money Market Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-6

Invesco Government Money Market Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

Bank of New York Mellon

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

2 Hanson Place

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Brooklyn, NY 11217-1431

T-7

Invesco Government Money Market Fund

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 holdings in various monthly and quarterly regulatory filings. The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) monthly on Form N-MFP. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. The most recent list of portfolio holdings is available at invesco.com/us. Shareholders can also look up the Fund's Form N-MFP 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 033-39519

Invesco Distributors, Inc.

GMKT-AR-1

Annual Report to Shareholders

February 29, 2020

Invesco High Yield Fund

Nasdaq:

A: AMHYX ￿ C: AHYCX ￿ Y: AHHYX ￿ Investor: HYINX ￿ R5: AHIYX ￿ R6: HYIFX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's web- site, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call (800) 959-4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

4 Performance Summary

6 Long-Term Fund Performance

8 Supplemental Information

9 Schedule of Investments

19 Financial Statements

22 Financial Highlights

23 Notes to Financial Statements

32Report of Independent Registered Public Accounting Firm

33Fund Expenses

34Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco High Yield Fund

Bruce Crockett

Dear Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco High Yield Fund

Management's Discussion of Fund Performance

Performance summary

For the fiscal year ended February 29, 2020, Class A shares of Invesco High Yield Fund (the Fund), at net asset value (NAV), underperformed the Fund's style- specific benchmark, the Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Cap Index.

Your Fund's long-term performance appears later in this report.

Fund vs. Indexes

Total returns, February 28, 2019 to February 29, 2020, 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

3.53%

Class C Shares

2.75

Class Y Shares

3.54

Investor Class Shares

3.53

Class R5 Shares

3.75

Class R6 Shares

3.70

Bloomberg Barclays U.S. Aggregate Bond Index￿ (Broad Market Index)

11.68

Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Cap Index￿

 

(Style-Specific Index)

6.10

Lipper High Current Yield Bond Funds Index￿ (Peer Group Index)

5.65

Source(s): ￿RIMES Technologies Corp.; ￿Lipper Inc.

During the fiscal year, the Fund benefited from its positioning in the environmental sub- industry, as well as the aerospace and de- fense and transportation services sectors. While the Fund had an underweight allocation to the pharmaceuticals sector relative to its style-specific benchmark, security selection was a significant contributor to the Fund's relative performance. The Fund's overweight allocation to diversified manufacturing was also beneficial to relative performance during the fiscal year, along with security selection in the pharmaceuticals and home construction sectors.

The largest detractors from the Fund's per- formance relative to the style-specific bench- mark during the fiscal year were positions in independent energy, technology and mid- stream industries. In those industries, security selection was a drag on the Fund's relative performance. Moreover, an underweight allo- cation to the packaging sector was a minor drag on the Fund's relative performance along with security selection in the construc- tion machinery and oil field services sectors. An underweight allocation to BB-rated bonds

Market conditions and your Fund

For the fiscal year, US high yield bond returns were positive. The fiscal year began with heightened volatility as investors feared that the US Federal Reserve (the Fed) had gone too far in its monetary policy tightening and that the effects would lead to a synchronized global economic growth slowdown. That un- certainty was quickly alleviated when the Fed changed its course and all but promised no rate hikes in 2019. The renewed risk appetite was further inspired by dovish central banks globally.

This trend continued throughout the fiscal year until February 2020, when investors began to fear that the spread of the Corona- virus (COVID-19) would lead to a global eco- nomic slowdown. Despite the uptick in volatil- ity late in the fiscal year, defaults continued to stay below the long-term average of about 2.91%.1 In particular, the par-weighted high yield default rate ended the fiscal year at 2.30%.1

Portfolio Composition*

By credit quality, based on total investments

A

1.8%

BBB

5.2

BB

30.2

B

40.4

CCC

15.0

CC

0.5

C

0.2

D

0.3

Cash

2.3

Non-Rated

4.1

The Fed cut interest rates three times dur- ing the fiscal year to a range of 1.50% to 1.75%.2 The European Central Bank also cut rates at the end of 2019 to -0.50%.3 This, coupled with easier fiscal and monetary policy in China and the continued economic woes plaguing the European Union, led to easier financial conditions globally, which, in turn, drove interest rates lower across maturities.

Against this backdrop, the high yield mar- ket produced positive monthly returns in 10 of the 12 months of the fiscal year. By qual- ity, BB-ratedbonds led the way during the fiscal year. By sector, housing and automo- tive had the strongest returns, while the en- ergy sector had the weakest performance for the fiscal year.

The Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Cap Index, which mea- sures the performance of the US high yield bond market and is the Fund's style-specific index, generated a positive return for the fis- cal year. Likewise, the Fund, at NAV, gener- ated a positive return for the fiscal year.

Top Five Debt Issuers

 

 

% of total net assets

 

 

 

 

1.

CSC Holdings, LLC

 

1.45%

2.

Sprint Corp.

 

1.43

3.

Navient Corp.

 

1.17

4.

HCA, Inc.

 

1.13

5.

Kenan Advantage Group, Inc.

 

 

(The)

 

1.00

was also a detractor from relative perfor- mance during the fiscal year; however, an allocation to BBB-rated bonds partially offset the underperformance.

During the fiscal year, we used derivatives to mitigate overall portfolio risk. These instru- ments include credit default swaps (CDX), options on CDX (known as swaptions) and total return swaps, which offer greater effi- ciency and lower transaction costs than cash bonds. However, derivatives may amplify tra- ditional investment risks through the creation of leverage and may be less liquid than tradi- tional securities. For the fiscal year, deriva- tives employed by the Fund had a small posi- tive impact on the Fund's performance.

We also used currency forward contracts

during the fiscal year to hedge currency expo- sure of our non-US dollar-denominated posi- tions. The use of currency forward contracts had a negligible impact on the Fund's perfor- mance.

At the close of the fiscal year, despite the uptick in volatility experienced during this

The Fund's holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.

Data presented here are as of February 29, 2020.

*Source: Standard & Poor's. A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO) of the creditworthiness of an issuer with respect to debt obligations, including specific securities, money market instruments or other debts. Ratings are measured on a scale that generally ranges from

AAA(highest) to D (lowest); ratings are subject to change without notice. "Non- Rated" indicates the debtor was not rated, and should not be interpreted as indicating low quality. For more information on Standard & Poor's rating methodology, please visit standardandpoors.com and select "Understanding Ratings" under Rating Resources on the homepage.

4Invesco High Yield Fund

time, we believed solid company fundamen- tals and low defaults could provide a solid foundation for 2020. We note recent macro- economic events, namely the coronavirus, have caused a material widening in credit spreads. It is unclear when these issues will be resolved, but it is our view that they will have a negative effect on second-quarter gross domestic product. That said, we also firmly believe that central banks will provide liquidity in an effort to avoid stressed financial condi- tions in a macroeconomic environment where company level revenues may suffer a short- term negative impact. In terms of new issue supply, many companies have already ac- cessed the market to refinance, thereby pushing out maturities. We believe there may be an increase in default activity in challenged sectors like energy, but we also recognize many of the companies have attractive hedges in place through year-end 2020, which may provide good visibility into near- term revenues. We expect continued chal- lenges in the wireline and retail industries as fundamental challenges threaten many com- panies in each sector. Given current uncer- tainties surrounding company level revenues, we think companies are likely to focus on pre- serving the strength of their balance sheets, as opposed to deliberately adding new debt. While we remain cautious, it is our opinion that the recent credit spread widening will create investment opportunities that we have not seen during the last few months of the fiscal year.

We wish to remind you that the Fund is subject to interest rate risk, meaning when interest rates rise, the value of fixed income securities tends to fall. The risk may be greater in the current market environment because interest rates are near historic lows. The degree to which the value of fixed income securities may decline due to rising interest rates may vary depending on the speed and magnitude of the increase in interest rates, as well as individual security characteristics, such as price, maturity, duration and coupon and market forces, such as supply and de- mand for similar securities. We are monitor- ing interest rates, and the market, economic and geopolitical factors that may impact the direction, speed and magnitude of changes to interest rates across the maturity spectrum, including the potential impact of monetary policy changes by the Fed and certain foreign central banks. If interest rates rise or fall faster than expected, markets may experience increased volatility which may affect the value and/or liquidity of certain of the Fund's invest- ments.

Thank you for investing in Invesco High Yield Fund and for sharing our long-term in- vestment horizon.

1 Source: JP Morgan

2 Source: US Federal Reserve

3 Source: European Central Bank

A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO) of the creditworthiness of an issuer with respect to debt obligations, including specific

securities, money market instruments or other debts. Ratings are measured on a scale that generally ranges from AAA (highest) to D (lowest); ratings are subject to change without notice. "Non-Rated" indicates the debtor was not rated, and should not be interpreted as indicating low quality. For more information on rating methodology, please visit www.standardandpoors.com and select "Under-standing Ratings" under Rating Resources on the homepage; www.fitchratings.com and select "Understanding Credit Ratings" from the drop-down menu on the homepage; and www.moodys.com and select "Methodology," then "Rating Methodologies" under Research Type on the left-hand side.

Portfolio Managers:

Andrew Geryol

Joseph Portera

Scott Roberts

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

5Invesco High Yield Fund

Your Fund's Long-Term Performance

Results of a $10,000 Investment — Oldest Share Class(es)

Fund and index data from 2/28/10

$25,000

$20,133 Bloomberg Barclays U.S. Corporate High Yield 2% Issuer

20,000Cap Index1

$18,877 Lipper High Current Yield Bond Funds Index2

$16,895 Invesco High Yield Fund — Class A Shares

15,000

$14,707 Bloomberg Barclays U.S. Aggregate Bond Index1

 

10,000

 

5,000

 

2/28/10

2/11

2/12

2/13

2/14

2/15

2/16

2/17

2/18

2/19

2/20

1Source: RIMES Technologies Corp.

2 Source: Lipper Inc.

Past performance cannot guarantee future results.

The data shown in the chart include rein- vested distributions, applicable sales charges and Fund expenses including management

fees. Index results include reinvested divi- dends, but they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses and management fees; performance of a market index does not. Per-

formance shown in the chart and table(s) does not reflect deduction of taxes a share- holder would pay on Fund distributions or sale of Fund shares.

6Invesco High Yield Fund

Average Annual Total Returns

As of 2/29/20, including maximum applicable sales charges

Class A Shares

Inception (7/11/78)

7.25%

10 Years

5.38

5

Years

2.53

1

Year

–0.88

Class C Shares

 

Inception (8/4/97)

3.40%

10 Years

5.06

5

Years

2.63

1

Year

1.78

Class Y Shares

 

Inception (10/3/08)

7.84%

10 Years

6.13

5

Years

3.67

1

Year

3.54

Investor Class Shares

 

Inception (9/30/03)

6.56%

10 Years

5.87

5

Years

3.44

1

Year

3.53

Class R5 Shares

 

Inception (4/30/04)

6.54%

10 Years

6.17

5

Years

3.72

1

Year

3.75

Class R6 Shares

 

10 Years

6.16%

5

Years

3.83

1

Year

3.70

Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.

The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month- end performance. Performance figures re- flect reinvested distributions, changes in net asset value and the effect of the maxi- mum sales charge unless otherwise stated. Performance figures do not reflect deduc- tion of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.

Class A share performance reflects the maximum 4.25% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class Y, Investor Class, Class R5 and Class R6 shares do not have a front- end sales charge or a CDSC; therefore, per- formance is at net asset value.

The performance of the Fund's share classes will differ primarily due to different sales charge structures and class expenses. Fund performance reflects any applicable

fee waivers and/or expense reimburse- ments. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more informa- tion.

7Invesco High Yield Fund

Invesco High Yield Fund's investment objective is total return through growth of capital and current income.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

About indexes used in this report

￿The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index con- sidered representative of the US invest- ment grade, fixed rate bond market.

￿The Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Cap Index is an un- managed index considered representative of the US high yield, fixed rate corporate bond market. Index weights for each is- suer are capped at 2%.

￿The Lipper High Current Yield Bond Funds Index is an unmanaged index con- sidered representative of high yield bond funds tracked by Lipper.

￿The Fund is not managed to track the per- formance of any particular index, including the index(es) described here, and conse- quently, 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. Perfor- mance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.

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

8Invesco High Yield Fund

Schedule of Investments(a)

February 29, 2020

Principal

AmountValue

U.S. Dollar Denominated Bonds & Notes–88.93%

Aerospace & Defense–3.40%

 

 

 

Bombardier, Inc. (Canada),

 

 

 

8.75%, 12/01/2021(b)

$ 1,614,000

$

1,712,083

5.75%, 03/15/2022(b)

2,034,000

 

2,078,300

7.50%, 03/15/2025(b)

4,486,000

 

4,441,140

7.88%, 04/15/2027(b)

2,362,000

 

2,350,249

Moog, Inc., 4.25%, 12/15/2027(b)

1,748,000

 

1,782,960

Spirit AeroSystems, Inc., 4.60%,

 

 

 

06/15/2028

1,112,000

 

1,104,980

TransDigm UK Holdings PLC, 6.88%,

 

 

 

05/15/2026

5,218,000

 

5,493,758

TransDigm, Inc.,

 

 

 

6.50%, 07/15/2024

1,266,000

 

1,297,125

6.50%, 05/15/2025

2,936,000

 

3,036,661

6.25%, 03/15/2026(b)

5,566,000

 

5,903,444

Triumph Group, Inc.,

 

 

 

5.25%, 06/01/2022

2,400,000

 

2,358,749

7.75%, 08/15/2025

5,404,000

 

5,365,713

 

 

 

36,925,162

Agricultural & Farm Machinery–0.63%

 

 

Titan International, Inc., 6.50%,

 

 

 

11/30/2023

9,131,000

 

6,874,867

Airlines–0.61%

 

 

 

Air Canada (Canada), 7.75%,

 

 

 

04/15/2021(b)

6,290,000

 

6,575,566

Alternative Carriers–1.06%

 

 

 

CenturyLink, Inc.,

 

 

 

Series S, 6.45%, 06/15/2021

1,411,000

 

1,467,088

Series Y, 7.50%, 04/01/2024

4,292,000

 

4,819,551

Level 3 Financing, Inc.,

 

 

 

5.38%, 05/01/2025

1,282,000

 

1,311,377

5.25%, 03/15/2026

3,752,000

 

3,880,881

 

 

 

11,478,897

Aluminum–0.21%

 

 

 

Novelis Corp., 4.75%,

 

 

 

01/30/2030(b)

2,269,000

 

2,234,228

Apparel Retail–1.02%

 

 

 

L Brands, Inc.,

 

 

 

6.88%, 11/01/2035

4,409,000

 

4,482,961

6.75%, 07/01/2036

1,490,000

 

1,512,499

Michaels Stores, Inc., 8.00%,

 

 

 

07/15/2027(b)

6,063,000

 

5,065,333

 

 

 

11,060,793

Apparel, Accessories & Luxury Goods–0.33%

 

 

William Carter Co. (The), 5.63%,

 

 

 

03/15/2027(b)

3,379,000

 

3,602,850

Application Software–0.03%

 

 

 

Castle US Holding Corp., 9.50%,

 

 

 

02/15/2028(b)

335,000

 

336,047

 

 

Principal

 

 

 

 

Amount

 

Value

Asset Management & Custody Banks–0.25%

 

 

RegionalCare Hospital Partners

 

 

 

 

Holdings, Inc., 8.25%,

 

 

 

 

05/01/2023(b)

$

2,600,000

$

2,720,939

Auto Parts & Equipment–1.14%

 

 

 

 

Adient Global Holdings Ltd., 4.88%,

 

 

 

 

08/15/2026(b)

 

2,248,000

 

1,944,576

Dana, Inc.,

 

 

 

 

5.50%, 12/15/2024

 

1,322,000

 

1,339,576

5.38%, 11/15/2027

 

2,324,000

 

2,353,050

Panther BF Aggregator 2 L.P./Panther

 

 

 

 

Finance Co., Inc. (Canada),

 

 

 

 

6.25%, 05/15/2026(b)

 

1,600,000

 

1,646,519

8.50%, 05/15/2027(b)

 

2,706,000

 

2,758,361

Tenneco, Inc., 5.00%, 07/15/2026

 

2,766,000

 

2,385,744

 

 

 

 

12,427,826

Automobile Manufacturers–1.53%

 

 

 

Ford Motor Credit Co. LLC,

 

 

 

 

5.60%, 01/07/2022

 

3,902,000

 

4,118,208

5.11%, 05/03/2029

 

3,948,000

 

3,978,591

J.B. Poindexter & Co., Inc., 7.13%,

 

 

 

 

04/15/2026(b)

 

8,045,000

 

8,514,848

Motors Liquidation Co., 0.00%,

 

 

 

 

07/15/2033(c)(d)

 

14,770,000

 

0

 

 

 

 

16,611,647

Automotive Retail–2.22%

 

 

 

 

Asbury Automotive Group, Inc.,

 

 

 

 

4.75%, 03/01/2030(b)

 

1,078,000

 

1,099,560

Capitol Investment Merger Sub 2 LLC,

 

 

 

 

10.00%, 08/01/2024(b)

 

6,099,000

 

6,132,026

Lithia Motors, Inc.,

 

 

 

 

5.25%, 08/01/2025(b)

 

2,065,000

 

2,158,782

4.63%, 12/15/2027(b)

 

1,237,000

 

1,269,385

Murphy Oil USA, Inc.,

 

 

 

 

5.63%, 05/01/2027

 

4,067,000

 

4,309,607

4.75%, 09/15/2029

 

1,619,000

 

1,701,002

Penske Automotive Group, Inc.,

 

 

 

 

5.50%, 05/15/2026

 

7,105,000

 

7,384,582

 

 

 

 

24,054,944

Brewers–0.29%

 

 

 

 

Molson Coors Beverage Co., 5.00%,

 

 

 

 

05/01/2042

 

2,800,000

 

3,173,166

Broadcasting–2.43%

 

 

 

 

AMC Networks, Inc.,

 

 

 

 

5.00%, 04/01/2024

 

3,466,000

 

3,491,995

4.75%, 08/01/2025

 

1,457,000

 

1,455,230

Clear Channel Worldwide Holdings,

 

 

 

 

Inc., 9.25%, 02/15/2024(b)

 

7,360,000

 

7,835,346

Gray Television, Inc., 7.00%,

 

 

 

 

05/15/2027(b)

 

4,142,000

 

4,500,697

iHeartCommunications, Inc., 8.38%,

 

 

 

 

05/01/2027

 

5,979,000

 

6,503,956

TV Azteca S.A.B. de C.V. (Mexico),

 

 

 

 

8.25%, 08/09/2024(b)

 

2,905,000

 

2,635,082

 

 

 

 

26,422,306

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco High Yield Fund

 

Principal

 

 

 

Amount

 

Value

Building Products–0.45%

 

 

 

Advanced Drainage Systems, Inc.,

 

 

 

5.00%, 09/30/2027(b)

$ 1,614,000

$

1,673,068

Builders FirstSource, Inc., 5.00%,

 

 

 

03/01/2030(b)

914,000

 

916,153

Standard Industries, Inc., 6.00%,

 

 

 

10/15/2025(b)

2,220,000

 

2,325,428

 

 

 

4,914,649

Cable & Satellite–5.34%

 

 

 

Altice Financing S.A. (Luxembourg),

 

 

 

7.50%, 05/15/2026(b)

3,510,000

 

3,700,944

CCO Holdings LLC/CCO Holdings Capital

 

 

 

Corp.,

 

 

 

5.75%, 02/15/2026(b)

7,396,000

 

7,703,304

4.50%, 08/15/2030(b)

1,276,000

 

1,292,747

Charter Communications

 

 

 

Operating LLC/Charter

 

 

 

Communications Operating Capital

 

 

 

Corp., 5.38%, 04/01/2038

2,800,000

 

3,220,370

CSC Holdings LLC,

 

 

 

7.75%, 07/15/2025(b)

3,100,000

 

3,270,469

10.88%, 10/15/2025(b)

5,809,000

 

6,384,527

6.50%, 02/01/2029(b)

4,625,000

 

5,101,953

5.75%, 01/15/2030(b)

826,000

 

874,527

DISH DBS Corp.,

 

 

 

5.88%, 11/15/2024

6,155,000

 

6,326,201

7.75%, 07/01/2026

2,782,000

 

2,994,573

DISH Network Corp., Conv., 3.38%,

 

 

 

08/15/2026

3,951,000

 

3,824,598

Telenet Finance Luxembourg Notes

 

 

 

S.a r.l. (Belgium), 5.50%,

 

 

 

03/01/2028(b)

3,000,000

 

3,183,000

UPC Holding B.V. (Netherlands),

 

 

 

5.50%, 01/15/2028(b)

1,000,000

 

1,015,950

Virgin Media Secured Finance PLC

 

 

 

(United Kingdom), 5.50%,

 

 

 

08/15/2026(b)

3,502,000

 

3,611,928

VTR Finance B.V. (Chile), 6.88%,

 

 

 

01/15/2024(b)

4,647,000

 

4,747,677

Ziggo B.V. (Netherlands), 5.50%,

 

 

 

01/15/2027(b)

225,000

 

232,175

Ziggo Bond Co B.V. (Netherlands),

 

 

 

5.13%, 02/28/2030(b)

488,000

 

487,085

 

 

 

57,972,028

Casinos & Gaming–2.27%

 

 

 

Boyd Gaming Corp.,

 

 

 

6.38%, 04/01/2026

730,000

 

762,375

6.00%, 08/15/2026

1,499,000

 

1,544,041

Cirsa Finance International S.a.r.l.

 

 

 

(Spain), 7.88%, 12/20/2023(b)

1,368,000

 

1,432,828

Codere Finance 2 (Luxembourg) S.A.

 

 

 

(Spain), 7.63%, 11/01/2021(b)

2,114,000

 

1,851,251

Melco Resorts Finance Ltd.

 

 

 

(Hong Kong), 5.63%,

 

 

 

07/17/2027(b)

1,807,000

 

1,894,226

MGM China Holdings Ltd. (Macau),

 

 

 

5.88%, 05/15/2026(b)

851,000

 

863,234

MGM Resorts International, 7.75%,

 

 

 

03/15/2022

5,095,000

 

5,588,094

Scientific Games International, Inc.,

 

 

 

7.00%, 05/15/2028(b)

1,856,000

 

1,811,874

Studio City Finance Ltd. (Macau),

 

 

 

7.25%, 02/11/2024(b)

4,037,000

 

4,237,175

 

 

Principal

 

 

 

 

Amount

 

Value

Casinos & Gaming–(continued)

 

 

 

 

Wynn Las Vegas LLC/Wynn Las Vegas

 

 

 

 

Capital Corp., 5.50%,

 

 

 

 

03/01/2025(b)

$

4,770,000

$

4,692,440

 

 

 

 

24,677,538

Coal & Consumable Fuels–0.67%

 

 

 

 

SunCoke Energy Partners

 

 

 

 

L.P./SunCoke Energy Partners

 

 

 

 

Finance Corp., 7.50%,

 

 

 

 

06/15/2025(b)

 

8,108,000

 

7,317,389

Commodity Chemicals–0.87%

 

 

 

 

Koppers, Inc., 6.00%,

 

 

 

 

02/15/2025(b)

 

3,677,000

 

3,631,000

Nufarm Australia Ltd./Nufarm

 

 

 

 

Americas, Inc. (Australia), 5.75%,

 

 

 

 

04/30/2026(b)

 

2,054,000

 

2,029,039

Olin Corp., 5.63%, 08/01/2029

 

3,749,000

 

3,788,927

 

 

 

 

9,448,966

Communications Equipment–0.68%

 

 

Hughes Satellite Systems Corp.,

 

 

 

 

7.63%, 06/15/2021

 

5,663,000

 

5,973,785

5.25%, 08/01/2026

 

1,250,000

 

1,373,872

 

 

 

 

7,347,657

Construction & Engineering–0.30%

 

 

 

Valmont Industries, Inc., 5.00%,

 

 

 

 

10/01/2044

 

2,811,000

 

3,240,753

Construction Materials–0.19%

 

 

 

 

Cemex S.A.B. de C.V. (Mexico),

 

 

 

 

5.45%, 11/19/2029(b)

 

2,020,000

 

2,030,100

Consumer Finance–1.66%

 

 

 

 

Ally Financial, Inc., 8.00%,

 

 

 

 

03/15/2020

 

5,353,000

 

5,365,847

Navient Corp.,

 

 

 

 

8.00%, 03/25/2020

 

1,719,000

 

1,727,965

7.25%, 01/25/2022

 

2,639,000

 

2,782,245

7.25%, 09/25/2023

 

5,808,000

 

6,258,062

5.00%, 03/15/2027

 

1,897,000

 

1,839,521

 

 

 

 

17,973,640

Copper–1.87%

 

 

 

 

First Quantum Minerals Ltd. (Zambia),

 

 

 

 

7.50%, 04/01/2025(b)

 

7,686,000

 

7,336,941

Freeport-McMoRan, Inc., 5.40%,

 

 

 

 

11/14/2034

 

7,829,000

 

7,654,237

Taseko Mines Ltd. (Canada), 8.75%,

 

 

 

 

06/15/2022(b)

 

5,925,000

 

5,349,161

 

 

 

 

20,340,339

Data Processing & Outsourced Services–0.46%

 

 

Alliance Data Systems Corp., 4.75%,

 

 

 

 

12/15/2024(b)

 

2,903,000

 

2,855,826

Cardtronics, Inc./Cardtronics USA,

 

 

 

 

Inc., 5.50%, 05/01/2025(b)

 

2,095,000

 

2,153,482

 

 

 

 

5,009,308

Department Stores–0.28%

 

 

 

 

Kohl's Corp., 5.55%, 07/17/2045

 

2,800,000

 

3,004,396

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco High Yield Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Distributors–0.69%

 

 

 

 

Core & Main Holdings L.P., 9.38% PIK

 

 

 

 

Rate, 8.63% Cash Rate,

 

 

 

 

09/15/2024(b)(e)

$

7,185,000

$

7,475,382

Diversified Banks–0.83%

 

 

 

 

Barclays Bank PLC (United Kingdom),

 

 

 

 

7.63%, 11/21/2022

 

1,212,000

 

1,351,222

Credit Agricole S.A. (France),

 

 

 

 

8.13%(b)(f)

 

3,082,000

 

3,647,193

Societe Generale S.A. (France),

 

 

 

 

7.38%(b)(f)

 

2,005,000

 

2,099,786

Standard Chartered PLC (United

 

 

 

 

Kingdom), 7.50%(b)(f)

 

1,836,000

 

1,929,517

 

 

 

 

9,027,718

Diversified Capital Markets–0.09%

 

 

 

Credit Suisse Group AG (Switzerland),

 

 

 

 

5.10%(b)(f)

 

945,000

 

939,094

Diversified Chemicals–0.32%

 

 

 

 

Chemours Co. (The), 7.00%,

 

 

 

 

05/15/2025

 

1,735,000

 

1,621,505

Trinseo Materials Operating

 

 

 

 

S.C.A./Trinseo Materials Finance,

 

 

 

 

Inc., 5.38%, 09/01/2025(b)

 

2,017,000

 

1,875,810

 

 

 

 

3,497,315

Diversified Metals & Mining–0.63%

 

 

 

Hudbay Minerals, Inc. (Canada),

 

 

 

 

7.25%, 01/15/2023(b)

 

1,100,000

 

1,108,706

7.63%, 01/15/2025(b)

 

2,853,000

 

2,754,329

Vedanta Resources Ltd. (India),

 

 

 

 

6.38%, 07/30/2022(b)

 

3,108,000

 

2,970,664

 

 

 

 

6,833,699

Diversified REITs–1.16%

 

 

 

 

Colony Capital, Inc.,

 

 

 

 

Conv.,

 

 

 

 

3.88%, 01/15/2021

 

240,000

 

238,191

5.00%, 04/15/2023

 

2,808,000

 

2,788,197

iStar, Inc., 4.75%, 10/01/2024

 

6,250,000

 

6,392,844

VICI Properties L.P./VICI Note Co., Inc.,

 

 

 

 

3.50%, 02/15/2025(b)

 

1,072,000

 

1,075,671

3.75%, 02/15/2027(b)

 

1,077,000

 

1,070,942

4.13%, 08/15/2030(b)

 

1,077,000

 

1,080,366

 

 

 

 

12,646,211

Diversified Support Services–0.15%

 

 

IAA, Inc., 5.50%, 06/15/2027(b)

 

1,528,000

 

1,620,597

Electric Utilities–0.22%

 

 

 

 

DPL, Inc., 4.35%, 04/15/2029(b)

 

2,542,000

 

2,377,700

Electrical Components & Equipment–0.64%

 

 

EnerSys,

 

 

 

 

5.00%, 04/30/2023(b)

 

5,451,000

 

5,721,288

4.38%, 12/15/2027(b)

 

1,256,000

 

1,273,270

 

 

 

 

6,994,558

Electronic Equipment & Instruments–0.70%

 

 

Itron, Inc., 5.00%, 01/15/2026(b)

 

3,406,000

 

3,515,511

MTS Systems Corp., 5.75%,

 

 

 

 

08/15/2027(b)

 

3,957,000

 

4,037,515

 

 

 

 

7,553,026

 

 

Principal

 

 

 

 

Amount

 

Value

Environmental & Facilities Services–0.39%

 

 

GFL Environmental, Inc. (Canada),

 

 

 

 

7.00%, 06/01/2026(b)

$

1,041,000

$

1,097,316

Waste Pro USA, Inc., 5.50%,

 

 

 

 

02/15/2026(b)

 

3,233,000

 

3,160,831

 

 

 

 

4,258,147

Fertilizers & Agricultural Chemicals–0.21%

 

 

OCI N.V. (Netherlands), 6.63%,

 

 

 

 

04/15/2023(b)

 

2,223,000

 

2,310,809

Food Retail–1.22%

 

 

 

 

Albertson's Cos., Inc./Safeway, Inc./New

 

 

 

 

Albertson's L.P./Albertson's LLC,

 

 

 

 

6.63%, 06/15/2024

 

5,651,000

 

5,820,473

7.50%, 03/15/2026(b)

 

2,024,000

 

2,252,967

4.63%, 01/15/2027(b)

 

2,869,000

 

2,831,273

5.88%, 02/15/2028(b)

 

2,251,000

 

2,343,629

 

 

 

 

13,248,342

Forest Products–0.40%

 

 

 

 

Norbord, Inc. (Canada), 5.75%,

 

 

 

 

07/15/2027(b)

 

4,166,000

 

4,375,748

Gas Utilities–0.53%

 

 

 

 

AmeriGas Partners L.P./AmeriGas

 

 

 

 

Finance Corp., 5.88%,

 

 

 

 

08/20/2026

 

2,485,000

 

2,582,834

Suburban Propane Partners

 

 

 

 

L.P./Suburban Energy Finance

 

 

 

 

Corp., 5.50%, 06/01/2024

 

2,685,000

 

2,663,547

Superior Plus L.P./Superior General

 

 

 

 

Partner, Inc. (Canada), 7.00%,

 

 

 

 

07/15/2026(b)

 

426,000

 

457,033

 

 

 

 

5,703,414

Health Care Facilities–2.43%

 

 

 

 

Acadia Healthcare Co., Inc.,

 

 

 

 

5.63%, 02/15/2023

 

2,000

 

2,019

6.50%, 03/01/2024

 

3,255,000

 

3,349,932

Community Health Systems, Inc.,

 

 

 

 

6.88%, 02/01/2022

 

1,532,000

 

1,443,910

6.63%, 02/15/2025(b)

 

2,480,000

 

2,535,800

8.00%, 03/15/2026(b)

 

3,229,000

 

3,340,639

HCA, Inc.,

 

 

 

 

7.50%, 02/15/2022

 

5,063,000

 

5,604,640

5.38%, 02/01/2025

 

2,630,000

 

2,912,949

5.88%, 02/15/2026

 

748,000

 

845,786

5.38%, 09/01/2026

 

1,437,000

 

1,601,975

5.50%, 06/15/2047

 

1,130,000

 

1,345,179

Tenet Healthcare Corp., 8.13%,

 

 

 

 

04/01/2022

 

3,174,000

 

3,444,520

 

 

 

 

26,427,349

Health Care REITs–0.29%

 

 

 

 

MPT Operating Partnership L.P./MPT

 

 

 

 

Finance Corp., 5.00%,

 

 

 

 

10/15/2027REIT

 

3,050,000

 

3,190,407

Health Care Services–1.36%

 

 

 

 

Envision Healthcare Corp., 8.75%,

 

 

 

 

10/15/2026(b)

 

1,650,000

 

878,052

Hadrian Merger Sub, Inc., 8.50%,

 

 

 

 

05/01/2026(b)

 

5,801,000

 

5,948,041

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco High Yield Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Health Care Services–(continued)

 

 

 

MPH Acquisition Holdings LLC,

 

 

 

 

7.13%, 06/01/2024(b)

$

4,760,000

$

4,439,699

Surgery Center Holdings, Inc.,

 

 

 

 

10.00%, 04/15/2027(b)

 

1,596,000

 

1,748,174

Team Health Holdings, Inc., 6.38%,

 

 

 

 

02/01/2025(b)

 

3,167,000

 

1,751,082

 

 

 

 

14,765,048

Home Improvement Retail–0.16%

 

 

 

Hillman Group, Inc. (The), 6.38%,

 

 

 

 

07/15/2022(b)

 

1,874,000

 

1,686,015

Homebuilding–2.28%

 

 

 

 

Ashton Woods USA LLC/Ashton Woods

 

 

 

 

Finance Co., 9.88%,

 

 

 

 

04/01/2027(b)

 

3,296,000

 

3,742,105

KB Home, 4.80%, 11/15/2029

 

2,227,000

 

2,343,918

Lennar Corp.,

 

 

 

 

8.38%, 01/15/2021

 

867,000

 

906,622

5.38%, 10/01/2022

 

4,053,000

 

4,307,577

5.25%, 06/01/2026

 

990,000

 

1,093,799

Mattamy Group Corp. (Canada),

 

 

 

 

5.25%, 12/15/2027(b)

 

2,060,000

 

2,137,250

Meritage Homes Corp., 5.13%,

 

 

 

 

06/06/2027

 

2,788,000

 

3,109,589

PulteGroup, Inc., 6.38%,

 

 

 

 

05/15/2033

 

87,000

 

106,886

Taylor Morrison Communities, Inc.,

 

 

 

 

6.63%, 07/15/2027(b)

 

4,406,000

 

4,788,749

5.75%, 01/15/2028(b)

 

2,034,000

 

2,253,118

 

 

 

 

24,789,613

Hotel & Resort REITs–0.27%

 

 

 

 

Service Properties Trust, 4.95%,

 

 

 

 

10/01/2029

 

2,800,000

 

2,956,734

Household Products–1.16%

 

 

 

 

Energizer Holdings, Inc.,

 

 

 

 

6.38%, 07/15/2026(b)

 

578,000

 

600,629

7.75%, 01/15/2027(b)

 

2,083,000

 

2,263,908

Reynolds Group Issuer, Inc./LLC,

 

 

 

 

7.00%, 07/15/2024(b)

 

3,834,000

 

3,877,152

Spectrum Brands, Inc., 5.75%,

 

 

 

 

07/15/2025

 

5,658,000

 

5,813,538

 

 

 

 

12,555,227

Human Resource & Employment Services–0.36%

 

ASGN, Inc., 4.63%, 05/15/2028(b)

 

3,926,000

 

3,889,292

Independent Power Producers & Energy Traders–0.86%

AES Corp. (The), 5.50%,

 

 

 

 

04/15/2025

 

1,569,000

 

1,608,868

Calpine Corp., 5.50%, 02/01/2024

 

2,200,000

 

2,167,022

Enviva Partners L.P./Enviva Partners

 

 

 

 

Finance Corp., 6.50%,

 

 

 

 

01/15/2026(b)

 

2,480,000

 

2,585,450

NRG Energy, Inc.,

 

 

 

 

6.63%, 01/15/2027

 

445,000

 

464,789

5.25%, 06/15/2029(b)

 

2,402,000

 

2,501,059

 

 

 

 

9,327,188

Industrial Machinery–1.71%

 

 

 

 

Cleaver-Brooks, Inc., 7.88%,

 

 

 

 

03/01/2023(b)

 

7,661,000

 

7,568,417

 

 

Principal

 

 

 

 

Amount

 

Value

Industrial Machinery–(continued)

 

 

 

 

EnPro Industries, Inc., 5.75%,

 

 

 

 

10/15/2026

$

4,997,000

$

5,323,541

Mueller Industries, Inc., 6.00%,

 

 

 

 

03/01/2027

 

5,570,000

 

5,641,561

 

 

 

 

18,533,519

Integrated Oil & Gas–0.62%

 

 

 

 

Petrobras Global Finance B.V.

 

 

 

 

(Brazil), 5.75%, 02/01/2029

 

4,851,000

 

5,477,992

Petroleos Mexicanos (Mexico),

 

 

 

 

5.95%, 01/28/2031(b)

 

1,330,000

 

1,303,400

 

 

 

 

6,781,392

Integrated Telecommunication Services–3.83%

 

 

Altice France S.A. (France), 7.38%,

 

 

 

 

05/01/2026(b)

 

4,808,000

 

5,051,044

AT&T, Inc., 4.75%, 05/15/2046

 

2,800,000

 

3,306,518

Cincinnati Bell, Inc.,

 

 

 

 

7.00%, 07/15/2024(b)

 

3,388,000

 

3,570,071

8.00%, 10/15/2025(b)

 

666,000

 

717,478

CommScope, Inc.,

 

 

 

 

6.00%, 03/01/2026(b)

 

3,812,000

 

3,919,895

8.25%, 03/01/2027(b)

 

5,981,000

 

6,044,399

Embarq Corp., 8.00%, 06/01/2036

 

3,195,000

 

3,408,346

Frontier Communications Corp.,

 

 

 

 

10.50%, 09/15/2022

 

9,954,000

 

4,544,618

11.00%, 09/15/2025

 

4,028,000

 

1,852,880

Telecom Italia Capital S.A. (Italy),

 

 

 

 

6.38%, 11/15/2033

 

731,000

 

848,713

7.20%, 07/18/2036

 

2,822,000

 

3,501,679

T-Mobile USA, Inc., 6.50%,

 

 

 

 

01/15/2026

 

4,609,000

 

4,860,882

 

 

 

 

41,626,523

Interactive Media & Services–1.41%

 

 

Cable Onda S.A. (Panama), 4.50%,

 

 

 

 

01/30/2030(b)

 

1,575,000

 

1,605,476

Cumulus Media New Holdings, Inc.,

 

 

 

 

6.75%, 07/01/2026(b)

 

5,021,000

 

5,223,467

Diamond Sports Group LLC/Diamond

 

 

 

 

Sports Finance Co.,

 

 

 

 

5.38%, 08/15/2026(b)

 

3,456,000

 

3,192,978

6.63%, 08/15/2027(b)

 

6,543,000

 

5,311,934

 

 

 

 

15,333,855

Internet & Direct Marketing Retail–0.32%

 

 

Prosus N.V. (China), 3.68%,

 

 

 

 

01/21/2030(b)

 

585,000

 

606,592

QVC, Inc., 5.45%, 08/15/2034

 

2,800,000

 

2,823,676

 

 

 

 

3,430,268

Internet Services & Infrastructure–0.02%

 

 

EIG Investors Corp., 10.88%,

 

 

 

 

02/01/2024

 

146,000

 

152,904

Rackspace Hosting, Inc., 8.63%,

 

 

 

 

11/15/2024(b)

 

11,000

 

10,560

 

 

 

 

163,464

Leisure Products–0.30%

 

 

 

 

Mattel, Inc., 6.75%, 12/31/2025(b)

 

3,041,000

 

3,202,279

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco High Yield Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Managed Health Care–0.70%

 

 

 

 

Centene Corp.,

 

 

 

 

5.38%, 06/01/2026(b)

$

2,317,000

$

2,442,929

5.38%, 08/15/2026(b)

 

1,267,000

 

1,335,101

4.63%, 12/15/2029(b)

 

1,816,000

 

1,946,480

Molina Healthcare, Inc., 4.88%,

 

 

 

 

06/15/2025(b)

 

1,846,000

 

1,879,071

 

 

 

 

7,603,581

Metal & Glass Containers–0.68%

 

 

 

 

Ardagh Packaging Finance

 

 

 

 

PLC/Ardagh Holdings USA, Inc.,

 

 

 

 

6.00%, 02/15/2025(b)

 

1,244,000

 

1,299,980

Flex Acquisition Co., Inc., 7.88%,

 

 

 

 

07/15/2026(b)

 

5,993,000

 

6,096,814

 

 

 

 

7,396,794

Movies & Entertainment–1.37%

 

 

 

 

AMC Entertainment Holdings, Inc.,

 

 

 

 

5.75%, 06/15/2025

 

4,931,000

 

3,971,502

6.13%, 05/15/2027

 

3,873,000

 

3,108,179

Netflix, Inc.,

 

 

 

 

5.88%, 11/15/2028

 

3,418,000

 

3,849,181

5.38%, 11/15/2029(b)

 

3,645,000

 

3,969,587

 

 

 

 

14,898,449

Office Services & Supplies–0.12%

 

 

 

Pitney Bowes, Inc., 5.20%,

 

 

 

 

04/01/2023

 

1,266,000

 

1,269,690

Oil & Gas Drilling–1.02%

 

 

 

 

Diamond Offshore Drilling, Inc.,

 

 

 

 

4.88%, 11/01/2043

 

1,582,000

 

643,186

Ensign Drilling, Inc. (Canada), 9.25%,

 

 

 

 

04/15/2024(b)

 

2,797,000

 

2,520,824

Precision Drilling Corp. (Canada),

 

 

 

 

7.75%, 12/15/2023

 

712,000

 

699,836

5.25%, 11/15/2024

 

2,608,000

 

2,314,065

Transocean, Inc.,

 

 

 

 

8.00%, 02/01/2027(b)

 

934,000

 

783,393

7.50%, 04/15/2031

 

4,178,000

 

2,496,459

Valaris PLC, 7.75%, 02/01/2026

 

4,109,000

 

1,633,225

 

 

 

 

11,090,988

Oil & Gas Equipment & Services–0.43%

 

 

Calfrac Holdings L.P. (Canada),

 

 

 

 

10.88%, 03/15/2026(b)

 

716,100

 

648,071

8.50%, 06/15/2026(b)

 

1,349,000

 

360,891

Hilcorp Energy I L.P./Hilcorp Finance

 

 

 

 

Co., 6.25%, 11/01/2028(b)

 

1,800,000

 

1,314,661

SESI LLC, 7.13%, 12/15/2021(b)

 

2,904,000

 

2,368,212

 

 

 

 

4,691,835

Oil & Gas Exploration & Production–4.39%

 

 

Ascent Resources Utica

 

 

 

 

Holdings LLC/ARU Finance Corp.,

 

 

 

 

10.00%, 04/01/2022(b)

 

4,137,000

 

3,535,950

California Resources Corp., 8.00%,

 

 

 

 

12/15/2022(b)

 

4,503,000

 

1,046,948

Callon Petroleum Co.,

 

 

 

 

6.13%, 10/01/2024

 

3,325,000

 

2,643,375

6.38%, 07/01/2026

 

1,434,000

 

1,119,018

Chesapeake Energy Corp., 11.50%,

 

 

 

 

01/01/2025(b)

 

1,377,040

 

826,224

 

Principal

 

 

 

Amount

 

Value

Oil & Gas Exploration & Production–(continued)

 

 

Denbury Resources, Inc.,

 

 

 

9.00%, 05/15/2021(b)

$ 2,100,000

$

1,842,225

5.50%, 05/01/2022

3,015,000

 

1,665,094

EP Energy LLC/Everest Acquisition

 

 

 

Finance, Inc., 8.00%,

 

 

 

11/29/2024(b)(c)

3,430,000

 

1,457,750

Genesis Energy L.P./Genesis Energy

 

 

 

Finance Corp.,

 

 

 

6.25%, 05/15/2026

6,911,000

 

5,790,364

7.75%, 02/01/2028

1,404,000

 

1,226,745

Gulfport Energy Corp.,

 

 

 

6.63%, 05/01/2023

6,163,000

 

3,237,486

6.00%, 10/15/2024

3,518,000

 

1,178,530

Oasis Petroleum, Inc.,

 

 

 

6.88%, 03/15/2022

1,100,000

 

866,250

6.88%, 01/15/2023

3,971,000

 

3,087,452

6.25%, 05/01/2026(b)

2,368,000

 

1,462,299

QEP Resources, Inc.,

 

 

 

5.25%, 05/01/2023

1,561,000

 

1,385,700

5.63%, 03/01/2026

6,163,000

 

4,945,962

SM Energy Co., 6.63%,

 

 

 

01/15/2027

2,115,000

 

1,644,037

Southwestern Energy Co.,

 

 

 

7.50%, 04/01/2026

3,252,000

 

2,487,861

7.75%, 10/01/2027

1,800,000

 

1,368,045

Whiting Petroleum Corp.,

 

 

 

Conv., 1.25%, 04/01/2020

458,000

 

413,345

5.75%, 03/15/2021

2,920,000

 

1,685,570

6.25%, 04/01/2023

2,971,000

 

1,344,377

6.63%, 01/15/2026

3,760,000

 

1,381,894

 

 

 

47,642,501

Oil & Gas Refining & Marketing–1.74%

 

 

Calumet Specialty Products Partners

 

 

 

L.P./Calumet Finance Corp.,

 

 

 

7.63%, 01/15/2022

5,185,000

 

5,142,939

EnLink Midstream Partners L.P.,

 

 

 

5.60%, 04/01/2044

2,117,000

 

1,635,372

NuStar Logistics L.P., 6.00%,

 

 

 

06/01/2026

4,647,000

 

4,865,288

Parkland Fuel Corp. (Canada),

 

 

 

6.00%, 04/01/2026(b)

4,302,000

 

4,503,549

PBF Holding Co. LLC/PBF Finance

 

 

 

Corp., 6.00%, 02/15/2028(b)

2,726,000

 

2,698,740

 

 

 

18,845,888

Oil & Gas Storage & Transportation–1.91%

 

 

Antero Midstream Partners

 

 

 

L.P./Antero Midstream Finance

 

 

 

Corp., 5.75%, 01/15/2028(b)

6,616,000

 

4,558,258

Crestwood Midstream Partners

 

 

 

L.P./Crestwood Midstream Finance

 

 

 

Corp., 5.75%, 04/01/2025

1,404,000

 

1,375,906

Holly Energy Partners L.P./Holly

 

 

 

Energy Finance Corp., 5.00%,

 

 

 

02/01/2028(b)

1,095,000

 

1,103,897

NGL Energy Partners L.P./NGL Energy

 

 

 

Finance Corp., 7.50%,

 

 

 

04/15/2026

5,764,000

 

4,913,075

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco High Yield Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Oil & Gas Storage & Transportation–(continued)

 

 

Targa Resources Partners L.P./Targa

 

 

 

 

Resources Partners Finance Corp.,

 

 

 

 

5.13%, 02/01/2025

$

3,016,000

$

3,034,880

5.88%, 04/15/2026

 

2,638,000

 

2,722,347

5.50%, 03/01/2030(b)

 

746,000

 

739,249

Williams Cos., Inc. (The), 7.88%,

 

 

 

 

09/01/2021

 

2,127,000

 

2,328,566

 

 

 

 

20,776,178

Other Diversified Financial Services–1.65%

 

 

eG Global Finance PLC (Netherlands),

 

 

 

 

6.75%, 02/07/2025(b)

 

3,100,000

 

3,036,714

8.50%, 10/30/2025(b)

 

1,474,000

 

1,539,718

Lions Gate Capital Holdings LLC,

 

 

 

 

6.38%, 02/01/2024(b)

 

3,757,000

 

3,691,215

LPL Holdings, Inc., 5.75%,

 

 

 

 

09/15/2025(b)

 

3,003,000

 

3,123,090

Tempo Acquisition LLC/Tempo

 

 

 

 

Acquisition Finance Corp., 6.75%,

 

 

 

 

06/01/2025(b)

 

6,590,000

 

6,575,568

 

 

 

 

17,966,305

Packaged Foods & Meats–2.76%

 

 

 

 

B&G Foods, Inc.,

 

 

 

 

5.25%, 04/01/2025

 

3,737,000

 

3,698,042

5.25%, 09/15/2027

 

1,033,000

 

1,023,961

JBS USA LUX S.A./JBS USA Food

 

 

 

 

Co./JBS USA Finance, Inc.,

 

 

 

 

5.50%, 01/15/2030(b)

 

4,218,000

 

4,459,101

Kraft Heinz Foods Co.,

 

 

 

 

6.88%, 01/26/2039

 

2,800,000

 

3,350,162

5.00%, 06/04/2042

 

2,720,000

 

2,735,571

Pilgrim's Pride Corp., 5.88%,

 

 

 

 

09/30/2027(b)

 

2,597,000

 

2,696,075

Post Holdings, Inc.,

 

 

 

 

5.63%, 01/15/2028(b)

 

2,642,000

 

2,766,332

4.63%, 04/15/2030(b)

 

2,342,000

 

2,314,107

Simmons Foods, Inc., 5.75%,

 

 

 

 

11/01/2024(b)

 

3,929,000

 

3,897,902

TreeHouse Foods, Inc., 6.00%,

 

 

 

 

02/15/2024(b)

 

2,964,000

 

3,066,510

 

 

 

 

30,007,763

Paper Packaging–0.43%

 

 

 

 

Cascades, Inc./Cascades USA, Inc.

 

 

 

 

(Canada), 5.38%, 01/15/2028(b)

 

1,600,000

 

1,652,000

Trivium Packaging Finance B.V.

 

 

 

 

(Netherlands),

 

 

 

 

5.50%, 08/15/2026(b)

 

2,134,000

 

2,215,361

8.50%, 08/15/2027(b)

 

708,000

 

745,630

 

 

 

 

4,612,991

Paper Products–0.82%

 

 

 

 

Mercer International, Inc. (Germany),

 

 

 

 

5.50%, 01/15/2026

 

2,013,000

 

1,903,744

Schweitzer-Mauduit International,

 

 

 

 

Inc., 6.88%, 10/01/2026(b)

 

6,512,000

 

7,002,663

 

 

 

 

8,906,407

Pharmaceuticals–2.07%

 

 

 

 

Bausch Health Americas, Inc.,

 

 

 

 

9.25%, 04/01/2026(b)

 

2,613,000

 

2,924,391

 

 

Principal

 

 

 

 

Amount

 

Value

Pharmaceuticals–(continued)

 

 

 

 

Bausch Health Cos., Inc.,

 

 

 

 

5.50%, 11/01/2025(b)

$

1,820,000

$

1,877,630

9.00%, 12/15/2025(b)

 

3,441,000

 

3,840,018

5.75%, 08/15/2027(b)

 

1,092,000

 

1,163,635

Endo Dac/Endo Finance LLC/Endo

 

 

 

 

Finco, Inc., 6.00%,

 

 

 

 

07/15/2023(b)

 

5,715,000

 

4,500,620

HLF Financing S.a.r.l. LLC/Herbalife

 

 

 

 

International, Inc., 7.25%,

 

 

 

 

08/15/2026(b)

 

5,571,000

 

5,633,674

Par Pharmaceutical, Inc., 7.50%,

 

 

 

 

04/01/2027(b)

 

2,346,000

 

2,483,300

 

 

 

 

22,423,268

Property & Casualty Insurance–0.12%

 

 

AmWINS Group, Inc., 7.75%,

 

 

 

 

07/01/2026(b)

 

1,251,000

 

1,302,263

Publishing–0.51%

 

 

 

 

Meredith Corp., 6.88%,

 

 

 

 

02/01/2026

 

5,463,000

 

5,493,306

Railroads–1.00%

 

 

 

 

Kenan Advantage Group, Inc. (The),

 

 

 

 

7.88%, 07/31/2023(b)

 

11,007,000

 

10,873,980

Real Estate Development–0.02%

 

 

 

 

China Evergrande Group (China),

 

 

 

 

8.25%, 03/23/2022(b)

 

240,000

 

226,436

Research & Consulting Services–0.19%

 

 

Dun & Bradstreet Corp. (The),

 

 

 

 

10.25%, 02/15/2027(b)

 

1,858,000

 

2,089,042

Restaurants–0.65%

 

 

 

 

1011778 BC ULC/New Red Finance,

 

 

 

 

Inc. (Canada), 5.00%,

 

 

 

 

10/15/2025(b)

 

2,663,000

 

2,680,749

IRB Holding Corp., 6.75%,

 

 

 

 

02/15/2026(b)

 

4,432,000

 

4,411,380

 

 

 

 

7,092,129

Security & Alarm Services–0.65%

 

 

 

Brink's Co. (The), 4.63%,

 

 

 

 

10/15/2027(b)

 

3,983,000

 

4,091,825

GW B-CR Security Corp. (Canada),

 

 

 

 

9.50%, 11/01/2027(b)

 

1,507,000

 

1,600,208

Prime Security Services

 

 

 

 

Borrower LLC/Prime Finance, Inc.,

 

 

 

 

5.75%, 04/15/2026(b)

 

1,335,000

 

1,390,902

 

 

 

 

7,082,935

Specialized Consumer Services–0.57%

 

 

ServiceMaster Co. LLC (The), 7.45%,

 

 

 

 

08/15/2027

 

5,389,000

 

6,185,750

Specialized REITs–1.07%

 

 

 

 

Iron Mountain US Holdings, Inc.,

 

 

 

 

5.38%, 06/01/2026(b)

 

355,000

 

368,436

Iron Mountain, Inc.,

 

 

 

 

5.75%, 08/15/2024

 

4,067,000

 

4,107,629

5.25%, 03/15/2028(b)

 

4,557,000

 

4,726,293

Rayonier A.M. Products, Inc., 5.50%,

 

 

 

 

06/01/2024(b)

 

4,162,000

 

2,392,297

 

 

 

 

11,594,655

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

14

Invesco High Yield Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Specialty Chemicals–0.70%

 

 

 

 

Element Solutions, Inc., 5.88%,

 

 

 

 

12/01/2025(b)

$

3,778,000

$

3,806,373

GCP Applied Technologies, Inc.,

 

 

 

 

5.50%, 04/15/2026(b)

 

3,689,000

 

3,847,064

 

 

 

 

7,653,437

Steel–0.15%

 

 

 

 

AK Steel Corp., 7.63%, 10/01/2021

 

1,600,000

 

1,601,520

Systems Software–0.21%

 

 

 

 

Banff Merger Sub, Inc., 9.75%,

 

 

 

 

09/01/2026(b)

 

1,030,000

 

1,040,326

Camelot Finance S.A., 4.50%,

 

 

 

 

11/01/2026(b)

 

1,251,000

 

1,259,474

 

 

 

 

2,299,800

Technology Hardware, Storage & Peripherals–0.97%

 

Dell International LLC/EMC Corp.,

 

 

 

 

7.13%, 06/15/2024(b)

 

5,499,000

 

5,760,202

8.10%, 07/15/2036(b)

 

2,880,000

 

3,958,467

Exela Intermediate LLC/Exela

 

 

 

 

Finance Inc., 10.00%,

 

 

 

 

07/15/2023(b)

 

830,000

 

282,200

Presidio Holdings, Inc., 8.25%,

 

 

 

 

02/01/2028(b)

 

550,000

 

568,563

 

 

 

 

10,569,432

Textiles–0.33%

 

 

 

 

Eagle Intermediate Global Holding

 

 

 

 

B.V./Ruyi US Finance LLC (China),

 

 

 

 

7.50%, 05/01/2025(b)

 

5,094,000

 

3,580,649

Thrifts & Mortgage Finance–0.07%

 

 

 

Nationstar Mortgage Holdings, Inc.,

 

 

 

 

6.00%, 01/15/2027(b)

 

773,000

 

786,725

Trading Companies & Distributors–1.80%

 

 

AerCap Global Aviation Trust

 

 

 

 

(Ireland), 6.50%,

 

 

 

 

06/15/2045(b)(g)

 

3,288,000

 

3,543,149

BMC East LLC, 5.50%,

 

 

 

 

10/01/2024(b)

 

4,521,000

 

4,669,809

Herc Holdings, Inc., 5.50%,

 

 

 

 

07/15/2027(b)

 

4,747,000

 

4,936,524

United Rentals North America, Inc.,

 

 

 

 

5.88%, 09/15/2026

 

2,084,000

 

2,198,568

6.50%, 12/15/2026

 

1,487,000

 

1,588,339

5.25%, 01/15/2030

 

2,478,000

 

2,611,440

 

 

 

 

19,547,829

Trucking–0.36%

 

 

 

 

Avis Budget Car Rental LLC/Avis

 

 

 

 

Budget Finance, Inc., 5.25%,

 

 

 

 

03/15/2025(b)

 

3,890,000

 

3,932,070

Wireless Telecommunication Services–3.72%

 

 

Digicel Group One Ltd. (Jamaica),

 

 

 

 

8.25%, 12/30/2022(b)

 

1,698,000

 

1,095,740

Digicel Group Two Ltd. (Jamaica),

 

 

 

 

8.25%, 09/30/2022(b)

 

1,602,000

 

389,719

Intelsat (Luxembourg) S.A.

 

 

 

 

(Luxembourg), 7.75%,

 

 

 

 

06/01/2021

 

2,609,000

 

1,976,317

 

Principal

 

 

 

Amount

 

Value

Wireless Telecommunication Services–(continued)

 

Intelsat Connect Finance S.A.

 

 

 

(Luxembourg), 9.50%,

 

 

 

02/15/2023(b)

$ 1,873,000

$

1,147,213

Intelsat Jackson Holdings S.A.

 

 

 

(Luxembourg),

 

 

 

5.50%, 08/01/2023

2,970,000

 

2,560,392

8.50%, 10/15/2024(b)

3,410,000

 

2,990,860

9.75%, 07/15/2025(b)

2,428,000

 

2,153,842

Oztel Holdings SPC Ltd. (Oman),

 

 

 

5.63%, 10/24/2023(b)

3,188,000

 

3,355,128

Sprint Capital Corp., 8.75%,

 

 

 

03/15/2032

1,730,000

 

2,407,900

Sprint Communications, Inc.,

 

 

 

11.50%, 11/15/2021

3,000,000

 

3,432,960

Sprint Corp.,

 

 

 

7.88%, 09/15/2023

9,559,000

 

10,949,022

7.63%, 02/15/2025

2,028,000

 

2,357,550

7.63%, 03/01/2026

1,837,000

 

2,175,743

Ypso Finance Bis S.A. (Luxembourg),

 

 

 

10.50%, 05/15/2027(b)

2,953,000

 

3,359,037

 

 

 

40,351,423

Total U.S. Dollar Denominated Bonds & Notes

 

 

(Cost $1,000,358,232)

 

 

965,691,953

Asset-Backed Securities–2.07%

Apidos CLO XV, Series 2013-15A,

 

 

Class CRR, 3.67% (3 mo. USD

 

 

LIBOR + 1.85%),

 

 

04/20/2031(b)(g)

3,478,000

3,419,006

Bain Capital Credit CLO Ltd. (Cayman

 

 

Islands),

 

 

Series 2019-1A, Class C, 4.57%

 

 

(3 mo. USD LIBOR + 2.75%),

 

 

04/18/2032(b)(g)

3,280,000

3,293,653

Series 2019-3A, Class C, 4.73%

 

 

(3 mo. USD LIBOR + 2.85%),

 

 

10/21/2032(b)(g)

2,319,000

2,334,745

Magnetite XXIII Ltd., Series 2019-

 

 

23A, Class C, 4.27% (3 mo. USD

 

 

LIBOR + 2.40%),

 

 

10/25/2032(b)(g)

3,469,000

3,478,797

Neuberger Berman Loan Advisers CLO

 

 

34 Ltd., Series 2019-34A,

 

 

Class C1, 4.51% (3 mo. USD

 

 

LIBOR + 2.60%),

 

 

01/20/2033(b)(g)

3,455,000

3,469,474

Octagon Investment Partners XVII

 

 

Ltd., Series 2013-1A, Class CR2,

 

 

3.49% (3 mo. USD LIBOR +

 

 

1.70%), 01/25/2031(b)(g)

3,248,497

3,160,439

Sonic Capital LLC, Series 2020-1A,

 

 

Class A2I, 3.85%,

 

 

01/20/2050(b)

3,232,000

3,353,410

Total Asset-Backed Securities

 

 

(Cost $22,225,163)

 

22,509,524

Exchange-Traded Funds–2.01%

Shares

 

 

 

Invesco Senior Loan ETF(h)

743,000

16,338,570

SPDR S&P 500 ETF Trust

18,500

5,480,810

Total Exchange-Traded Funds

 

 

(Cost $22,198,297)

 

21,819,380

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

15

Invesco High Yield Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Variable Rate Senior Loan Interests–1.76%(i)

 

Cable & Satellite–0.84%

 

 

 

 

Altice Financing S.A. (Luxembourg),

 

 

 

 

Term Loan, 4.41% (1 mo. USD

 

 

 

 

LIBOR + 2.75%), 07/15/2025(g)

$

2,443,718

$

2,368,891

Charter Communications

 

 

 

 

Operating LLC, Term Loan B-1,

 

 

 

 

3.36% (1 mo. USD LIBOR +

 

 

 

 

1.75%), 04/30/2025(g)

 

3,400,326

 

3,373,973

CSC Holdings LLC, Term Loan, 4.16%

 

 

 

 

(1 mo. USD LIBOR + 2.50%),

 

 

 

 

04/15/2027(g)

 

3,411,000

 

3,381,154

 

 

 

 

9,124,018

Household Products–0.31%

 

 

 

 

Reynolds Group Issuer, Inc./LLC,

 

 

 

 

Incremental Term Loan, 4.35% (1

 

 

 

 

mo. USD LIBOR + 2.75%),

 

 

 

 

02/05/2023(g)

 

3,405,224

 

3,380,399

Pharmaceuticals–0.30%

 

 

 

 

Valeant Pharmaceuticals

 

 

 

 

International, Inc. (Canada), First

 

 

 

 

Lien Incremental Term Loan,

 

 

 

 

4.41% (1 mo. USD LIBOR +

 

 

 

 

2.75%), 11/27/2025(g)

 

3,321,314

 

3,309,391

Wireless Telecommunication Services–0.31%

 

 

Sprint Communications, Inc.,

 

 

 

 

Incremental Term Loan, 4.63% (1

 

 

 

 

mo. USD LIBOR + 3.00%),

 

 

 

 

02/02/2024(g)

 

3,364,504

 

3,343,476

Total Variable Rate Senior Loan Interests

 

 

(Cost $19,339,468)

 

 

 

19,157,284

Non-U.S. Dollar Denominated Bonds & Notes–0.55%(j)

Diversified Banks–0.23%

 

 

 

 

Erste Group Bank AG (Austria),

 

 

 

 

6.50%(f)

EUR

2,000,000

 

2,503,428

Food Retail–0.23%

 

 

 

 

Iceland Bondco PLC (United Kingdom),

 

 

 

4.63%, 03/15/2025(b)

GBP

2,350,000

 

2,371,363

Quatrim S.A.S.U. (France), 5.88%,

 

 

 

 

01/15/2024(b)

EUR

150,000

 

167,041

 

 

 

 

2,538,404

Other Diversified Financial Services–0.02%

 

 

eG Global Finance PLC (United

 

 

 

 

Kingdom), 6.25%,

 

 

 

 

10/30/2025(b)

EUR

200,000

 

215,347

Paper Packaging–0.05%

 

 

 

 

M&G Finance Luxembourg S.A. (Italy),

 

 

 

 

5.23%(c)(f)

EUR

4,100,000

 

543,143

Textiles–0.02%

 

 

 

 

Eagle Intermediate Global Holding

 

 

 

 

B.V./Ruyi US Finance LLC (China),

 

 

 

 

5.38%, 05/01/2023(b)

EUR

200,000

 

165,593

Total Non-U.S. Dollar Denominated Bonds & Notes

 

 

(Cost $7,356,237)

 

 

 

5,965,915

 

 

Principal

 

 

 

 

Amount

 

Value

 

U.S. Treasury Securities–0.21%

 

 

U.S. Treasury Bills–0.21%

 

 

 

1.69%, 04/09/2020

 

 

 

 

(Cost $2,271,233)(k)(l)

$ 2,275,000

$

2,271,233

U.S. Government Sponsored Agency Mortgage-Backed

 

Securities–0.07%

 

 

 

 

Freddie Mac Multifamily

 

 

 

 

Connecticut Avenue Securities

 

 

 

 

Trust, Series 2019-01,

 

 

 

 

Class M10,

 

 

 

 

4.88% (1 mo. USD LIBOR +

 

 

 

 

3.25%), 10/15/2049(b)(g)

 

 

 

 

(Cost $747,000)

747,000

 

780,344

 

 

Shares

 

 

Common Stocks & Other Equity Interests–0.00%

Diversified Support Services–0.00%

 

 

ACC Claims Holdings LLC(d)(m)

4,130,550

 

4

Integrated Telecommunication Services–0.00%

 

 

Ventelo Ltd. (United Kingdom)(d)(m)

73,021

 

0

Leisure Products–0.00%

 

 

 

HF Holdings, Inc.(d)(m)

36,820

 

0

Other Diversified Financial Services–0.00%

 

 

Adelphia Recovery Trust,

 

 

 

 

Series ACC1(m)(n)

4,846,549

 

9,208

Adelphia Recovery Trust,

 

 

 

 

Series Arahova(m)(n)

2,211,702

 

3,318

 

 

 

 

12,526

 

Total Common Stocks & Other Equity Interests

 

 

 

(Cost $9,361,768)

 

 

12,530

Money Market Funds–3.28%

 

 

 

Invesco Government & Agency Portfolio,

 

 

 

 

Institutional Class, 1.50%(o)

12,220,019

 

12,220,019

Invesco Liquid Assets Portfolio,

 

 

 

 

Institutional Class, 1.64%(o)

9,414,582

 

9,419,290

Invesco Treasury Portfolio, Institutional

 

 

 

 

Class, 1.48%(o)

13,965,736

 

13,965,736

 

Total Money Market Funds (Cost $35,604,124)

 

35,605,045

TOTAL INVESTMENTS IN SECURITIES–98.88%

 

 

 

(Cost $1,119,461,522)

 

 

1,073,813,208

OTHER ASSETS LESS LIABILITIES—1.12%

 

 

12,140,089

NET ASSETS–100.00%

 

$1,085,953,297

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

16

Invesco High Yield Fund

Investment Abbreviations:

CLO

– Collateralized Loan Obligation

Conv. – Convertible

ETF

– Exchange-Traded Fund

EUR

– Euro

GBP

– British Pound Sterling

LIBOR – London Interbank Offered Rate

PIK

– Pay-in-Kind

REIT

– Real Estate Investment Trust

SPDR

– Standard & Poor's Depositary Receipt

USD

– U.S. Dollar

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)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 February 29, 2020 was $579,774,887, which represented 53.62% of the Fund's Net Assets.

(c)Defaulted security. Currently, the issuer is in default with respect to principal and/or interest payments. The aggregate value of these securities at February 29, 2020 was $2,000,893, which represented less than 1% of the Fund's Net Assets.

(d)Securities valued using significant unobservable inputs (Level 3). See Note 3.

(e)All or a portion of this security is Pay-in-Kind. Pay-in-Kind securities pay interest income in the form of securities.

(f)Perpetual bond with no specified maturity date.

(g)Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on February 29, 2020.

(h)The security and the Fund are affiliated by having the same investment adviser. The table below shows the Fund's transactions in, and earnings from, its investments in affiliates (excluding affiliated money market funds) for the fiscal year ended February 29, 2020.

 

 

 

 

Change in

 

 

 

 

 

 

 

Unrealized

 

 

 

 

Value

Purchases

Proceeds

Appreciation

Realized

Value

Dividend

 

February 28, 2019

at Cost

from Sales

(Depreciation)

Gain

February 29, 2020

Income

Invesco Senior Loan ETF

$-

$16,858,670

$-

$(520,100)

$-

$16,338,570

$-

 

 

 

 

 

 

 

 

(i)Variable rate senior loan interests are, at present, not readily marketable, not registered under the 1933 Act and may be subject to contractual and legal restrictions on sale. Variable rate senior loan interests in the Fund's portfolio generally have variable rates which adjust to a base, such as the London Interbank Offered Rate ("LIBOR"), on set dates, typically every 30 days, but not greater than one year, and/or have interest rates that float at margin above a widely recognized base lending rate such as the Prime Rate of a designated U.S. bank.

(j)Foreign denominated security. Principal amount is denominated in the currency indicated.

(k)All or a portion of the value was designated as collateral to cover margin requirements for swap agreements. See Note 1M.

(l)Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund.

(m)Non-income producing security.

(n)Acquired as part of the Adelphia Communications bankruptcy reorganization.

(o)The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of February 29, 2020.

Open Forward Foreign Currency Contracts

 

 

Contract to

 

Unrealized

Settlement

 

Appreciation

Date

Counterparty

Deliver

Receive

(Depreciation)

Currency Risk

 

 

 

 

 

 

05/29/2020

Goldman Sachs International

GBP 852,762

USD 1,105,286

$

9,668

 

 

 

 

 

 

 

Currency Risk

 

 

 

 

 

 

05/29/2020

Goldman Sachs International

EUR 8,743,418

USD 9,542,173

 

(158,283)

Total Forward Foreign Currency Contracts

 

 

 

$

(148,615)

 

 

 

 

 

 

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

17

Invesco High Yield Fund

Open Over-The-Counter Total Return Swap Agreements

 

 

 

 

 

 

 

 

Upfront

 

 

 

 

 

 

 

 

 

 

Payments

 

Unrealized

 

Pay/

 

Fixed

Payment

Number of

 

 

Paid

 

Appreciation

Counterparty

Receive

Reference Entity

Rate

Frequency

Contracts

Maturity Date

Notional Value

(Received)

Value

(Depreciation)

Interest Rate Risk

 

 

 

 

 

 

 

 

 

 

Morgan Stanley & Co.

 

Markit iBoxx USD Liquid

 

 

 

 

 

 

 

 

LLC

Receive

Leveraged Loan Index

1.91%

Quarterly

60,887

June—2020

$ 10,825,000

$—

$(153,991)

$(153,991)

Morgan Stanley & Co.

 

Markit iBoxx USD Liquid

 

 

 

 

 

 

 

 

LLC

Receive

Leveraged Loan Index

1.91

Quarterly

94,915

June—2020

16,875,000

(240,055)

(240,055)

Total — Total Return Swap Agreements

 

 

 

 

 

$—

$(394,046)

$(394,046)

 

 

 

 

 

 

 

 

 

 

 

Abbreviations:

EUR —Euro

GBP —British Pound Sterling

USD —U.S. Dollar

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

18

Invesco High Yield Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

Investments in securities, at value

 

(Cost $1,083,857,398)

$1,038,208,163

Investments in affiliated money market funds, at value

 

(Cost $35,604,124)

35,605,045

Other investments:

 

Unrealized appreciation on forward foreign currency

 

contracts outstanding

9,668

Cash

1,862,291

Foreign currencies, at value (Cost $9,174,825)

9,206,704

Receivable for:

 

Investments sold

3,478,339

Fund shares sold

696,080

Dividends

43,559

Interest

18,080,836

Investments matured, at value (Cost $2,672,027)

0

Investment for trustee deferred compensation and

 

retirement plans

323,361

Other assets

55,510

Total assets

1,107,569,556

Liabilities:

 

Other investments:

 

Unrealized depreciation on forward foreign currency

 

contracts outstanding

158,283

Swaps payable — OTC

105,703

Unrealized depreciation on swap agreements—OTC

394,046

Payable for:

 

Investments purchased

14,625,394

Dividends

1,078,265

Fund shares reacquired

4,242,353

Accrued fees to affiliates

508,925

Accrued trustees' and officers' fees and benefits

3,661

Accrued other operating expenses

100,266

Trustee deferred compensation and retirement plans

399,363

Total liabilities

21,616,259

Net assets applicable to shares outstanding

$1,085,953,297

Net assets consist of:

 

 

 

Shares of beneficial interest

$1,304,441,242

 

Distributable earnings (loss)

 

(218,487,945)

 

$1,085,953,297

 

Net Assets:

 

 

 

Class A

$

663,578,344

 

Class C

$

35,743,067

 

Class Y

$

61,065,387

 

Investor Class

$

80,043,252

 

Class R5

$

55,520,225

 

Class R6

$

190,003,022

 

Shares outstanding, no par value, with an unlimited number of shares authorized:

Class A

 

167,606,730

Class C

 

9,050,159

Class Y

 

15,383,255

Investor Class

 

20,226,376

Class R5

 

14,081,104

Class R6

 

48,090,684

Class A:

 

 

Net asset value per share

$

3.96

Maximum offering price per share

 

 

(Net asset value of $3.96 ÷ 95.75%)

$

4.14

Class C:

 

 

Net asset value and offering price per share

$

3.95

Class Y:

 

 

Net asset value and offering price per share

$

3.97

Investor Class:

 

 

Net asset value and offering price per share

$

3.96

Class R5:

 

 

Net asset value and offering price per share

$

3.94

Class R6:

 

 

Net asset value and offering price per share

$

3.95

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

19

Invesco High Yield Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

 

Interest

$ 67,721,778

Dividends from affiliated money market funds

1,107,112

Dividends

408,664

 

Total investment income

69,237,554

Expenses:

 

 

 

Advisory fees

6,009,143

Administrative services fees

161,692

 

Custodian fees

30,801

 

Distribution fees:

 

 

 

Class A

1,705,771

Class C

364,465

 

Investor Class

204,188

 

Transfer agent fees — A, C, Y and Investor

1,618,411

Transfer agent fees — R5

60,944

 

Transfer agent fees — R6

16,946

 

Trustees' and officers' fees and benefits

29,872

 

Registration and filing fees

124,642

 

Reports to shareholders

128,604

 

Professional services fees

202,984

 

Other

24,277

 

Total expenses

10,682,740

Less: Fees waived and/or expense offset arrangement(s)

(77,783)

Net expenses

10,604,957

Net investment income

58,632,597

Realized and unrealized gain (loss) from:

 

 

 

Net realized gain (loss) from:

 

 

 

Investment securities

(24,612,433)

 

 

 

Foreign currencies

(253,749)

Forward foreign currency contracts

720,414

 

Option contracts written

1,206,315

 

Swap agreements

1,114,175

 

 

(21,825,278)

Change in net unrealized appreciation (depreciation) of:

 

 

 

Investment securities

3,888,322

 

Foreign currencies

29,725

 

Forward foreign currency contracts

(94,538)

 

 

 

Swap agreements

(1,076,153)

 

2,747,356

 

Net realized and unrealized gain (loss)

(19,077,922)

Net increase in net assets resulting from operations

$ 39,554,675

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

20

Invesco High Yield Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

Operations:

 

 

 

 

 

 

Net investment income

$

58,632,597

$

60,064,399

 

Net realized gain (loss)

 

(21,825,278)

 

78,303

 

 

Change in net unrealized appreciation (depreciation)

 

2,747,356

 

(20,698,748)

Net increase in net assets resulting from operations

 

39,554,675

 

39,443,954

 

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

Class A

 

(38,994,977)

 

(34,588,949)

 

 

 

 

 

 

Class C

 

(1,808,858)

 

(3,276,545)

 

 

 

 

 

 

Class Y

 

(4,886,397)

 

(5,794,540)

 

 

 

 

 

 

Investor Class

 

(4,667,659)

 

(4,750,718)

 

 

 

 

 

 

Class R5

 

(3,764,959)

 

(3,788,389)

 

 

 

 

 

 

Class R6

 

(11,783,723)

 

(10,543,548)

 

 

 

 

 

 

Total distributions from distributable earnings

 

(65,906,573)

 

(62,742,689)

Share transactions–net:

 

 

 

 

 

 

Class A

 

(5,464,341)

 

(4,157,866)

 

 

 

 

 

 

Class C

 

(1,015,015)

 

(48,996,297)

 

 

 

 

 

 

Class Y

 

(49,924,429)

 

(2,683,956)

 

 

 

 

 

 

Investor Class

 

2,533,035

 

(16,578,847)

 

 

 

 

 

 

Class R5

 

(7,920,168)

 

(8,938,197)

 

 

 

 

 

 

Class R6

 

7,796,010

 

(4,496,115)

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from share transactions

 

(53,994,908)

 

(85,851,278)

 

 

 

 

 

 

Net increase (decrease) in net assets

 

(80,346,806)

 

(109,150,013)

Net assets:

 

 

 

 

 

 

Beginning of year

 

1,166,300,103

 

1,275,450,116

 

End of year

$1,085,953,297

$

1,166,300,103

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

21

Invesco High Yield Fund

Financial Highlights

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

Net gains

 

 

 

 

 

 

 

 

to average

to average net

 

 

 

 

 

(losses)

 

 

 

 

 

 

 

 

net assets

assets without

Ratio of net

 

 

Net asset

 

on securities

 

Dividends

 

 

 

 

 

 

with fee waivers

fee waivers

investment

 

 

value,

Net

(both

Total from

from net

 

 

 

Net asset

 

Net assets,

and/or

and/or

income

 

 

beginning

investment

realized and

investment

investment

Return of

Total

value, end

Total

end ofperiod

expenses

expenses

to average

Portfolio

 

ofperiod

income(a)

unrealized)

operations

income

capital

distributions

ofperiod

return (b)

(000's omitted)

absorbed

absorbed

net assets

turnover (c)

Class A

 

 

 

 

 

 

 

 

 

 

 

1.01%(d)

1.02%(d)

5.09%(d)

 

Year ended 02/29/20

$4.05

$0.21

$(0.07)

$ 0.14

$(0.23)

$

$(0.23)

$3.96

3.53%

$663,578

62%

Year ended 02/28/19

4.13

0.20

(0.07)

0.13

(0.21)

 

(0.21)

4.05

3.28

685,222

1.15

1.15

4.96

34

Year ended 02/28/18

4.21

0.20

(0.07)

0.13

(0.21)

 

(0.21)

4.13

3.07

701,560

1.07

1.08

4.69

56

Year ended 02/28/17

3.83

0.21

0.39

0.60

(0.21)

 

(0.01)

(0.22)

4.21

15.91

828,560

1.00

1.01

5.10

99

Year ended 02/29/16

4.38

0.23

(0.54)

(0.31)

(0.24)

 

(0.24)

3.83

(7.43)

744,564

1.03

1.03

5.39

84

Class C

 

 

 

 

 

 

 

 

 

 

 

1.76(d)

1.77(d)

4.34(d)

62

Year ended 02/29/20

4.04

0.18

(0.07)

0.11

(0.20)

 

(0.20)

3.95

2.75

35,743

Year ended 02/28/19

4.12

0.17

(0.07)

0.10

(0.18)

 

(0.18)

4.04

2.50

37,607

1.90

1.90

4.21

34

Year ended 02/28/18

4.20

0.16

(0.06)

0.10

(0.18)

 

(0.18)

4.12

2.29

88,812

1.82

1.83

3.94

56

Year ended 02/28/17

3.82

0.18

0.39

0.57

(0.18)

 

(0.01)

(0.19)

4.20

15.09

101,572

1.75

1.76

4.35

99

Year ended 02/29/16

4.37

0.19

(0.54)

(0.35)

(0.20)

 

(0.20)

3.82

(8.18)

92,310

1.78

1.78

4.64

84

Class Y

 

 

 

 

 

 

 

 

 

 

 

0.76(d)

0.77(d)

5.34(d)

62

Year ended 02/29/20

4.07

0.22

(0.08)

0.14

(0.24)

 

(0.24)

3.97

3.54

61,065

Year ended 02/28/19

4.14

0.21

(0.06)

0.15

(0.22)

 

(0.22)

4.07

3.79

112,350

0.90

0.90

5.21

34

Year ended 02/28/18

4.23

0.21

(0.08)

0.13

(0.22)

 

(0.22)

4.14

3.09

116,954

0.82

0.83

4.94

56

Year ended 02/28/17

3.84

0.22

0.40

0.62

(0.22)

 

(0.01)

(0.23)

4.23

16.44

201,080

0.75

0.76

5.35

99

Year ended 02/29/16

4.39

0.24

(0.54)

(0.30)

(0.25)

 

(0.25)

3.84

(7.18)

88,893

0.78

0.78

5.64

84

Investor Class

 

 

 

 

 

 

 

 

 

 

 

1.01(d)

1.02(d)

5.09(d)

 

Year ended 02/29/20

4.05

0.21

(0.07)

0.14

(0.23)

 

(0.23)

3.96

3.53

80,043

62

Year ended 02/28/19

4.13

0.20

(0.07)

0.13

(0.21)

 

(0.21)

4.05

3.31

79,404

1.15

1.15

4.96

34

Year ended 02/28/18

4.21

0.20

(0.07)

0.13

(0.21)

 

(0.21)

4.13

3.11(e)

97,913

1.01(e)

1.02(e)

4.75(e)

56

Year ended 02/28/17

3.83

0.21

0.39

0.60

(0.21)

 

(0.01)

(0.22)

4.21

15.95(e)

105,545

0.96(e)

0.97(e)

5.14(e)

99

Year ended 02/29/16

4.38

0.23

(0.54)

(0.31)

(0.24)

 

(0.24)

3.83

(7.40)(e)

100,212

1.01(e)

1.01(e)

5.41(e)

84

Class R5

 

 

 

 

 

 

 

 

 

 

 

0.68(d)

0.69(d)

5.42(d)

62

Year ended 02/29/20

4.04

0.22

(0.07)

0.15

(0.25)

 

(0.25)

3.94

3.75

55,520

Year ended 02/28/19

4.12

0.21

(0.07)

0.14

(0.22)

 

(0.22)

4.04

3.59

64,804

0.84

0.84

5.27

34

Year ended 02/28/18

4.20

0.21

(0.07)

0.14

(0.22)

 

(0.22)

4.12

3.40

75,185

0.75

0.76

5.01

56

Year ended 02/28/17

3.82

0.22

0.39

0.61

(0.22)

 

(0.01)

(0.23)

4.20

16.32

88,644

0.66

0.67

5.44

99

Year ended 02/29/16

4.37

0.24

(0.54)

(0.30)

(0.25)

 

(0.25)

3.82

(7.15)

86,239

0.69

0.69

5.73

84

Class R6

 

 

 

 

 

 

 

 

 

 

 

0.59(d)

0.60(d)

5.51(d)

 

Year ended 02/29/20

4.05

0.22

(0.07)

0.15

(0.25)

 

(0.25)

3.95

3.70

190,003

62

Year ended 02/28/19

4.12

0.22

(0.06)

0.16

(0.23)

 

(0.23)

4.05

3.94

186,913

0.75

0.75

5.36

34

Year ended 02/28/18

4.20

0.21

(0.07)

0.14

(0.22)

 

(0.22)

4.12

3.49

195,027

0.66

0.67

5.10

56

Year ended 02/28/17

3.82

0.23

0.39

0.62

(0.23)

 

(0.01)

(0.24)

4.20

16.42

157,367

0.57

0.58

5.53

99

Year ended 02/29/16

4.37

0.24

(0.54)

(0.30)

(0.25)

 

(0.25)

3.82

(7.07)

125,310

0.60

0.60

5.82

84

(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. 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 based on average daily net assets (000's omitted) of $682,308, $36,447, $82,123, $81,675 , $60,891 and $191,921 for Class A, Class C, Class Y, Investor Class, Class R5 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 0.19%, 0.21% and 0.23% for the years ended February 28, 2018, February 28, 2017 and February 29, 2016, respectively.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

22

Invesco High Yield Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco High Yield Fund (the "Fund"), is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"). The Trust is organized as a Delaware statutory trust and is 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 total return through growth of capital and current income.

The Fund currently consists of six different classes of shares: Class A, Class C, 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 and 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, 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.

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.

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.

Variable rate senior loan interests are fair valued using quotes provided by an independent pricing service. Quotes provided by the pricing service may reflect appropriate factors such as ratings, tranche type, industry, company performance, spread, individual trading characteristics, institution-size trading in similar groups of securities and other market data.

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.

Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.

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 economic conditions, interest rates, investor perceptions 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 settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash

23

Invesco High Yield Fund

dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Paydown gains and losses on mortgage and asset-backed securities are recorded as adjustments to interest income. 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 realized and unrealized capital gains and losses to a class based on the relative net assets of each class. The Fund allocates income to a class based on the relative value of the settled shares 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, if any, are declared daily and paid monthly. Distributions from 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

24

Invesco High Yield Fund

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.

K.Call Options Purchased and Written – The Fund may write covered 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. 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.

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.

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.

L.Put Options Purchased and Written – The Fund may purchase and write put options including options on securities indexes, or foreign currency and/or futures contracts. By purchasing a put option, the Fund obtains the right (but not the obligation) to sell the option's underlying instrument at a fixed strike price. In return for this right, the Fund pays an option premium. The option's underlying instrument may be a security, securities index, or a futures contract. Put options may be used by the Fund to hedge securities it owns by locking in a minimum price at which the Fund can sell. If security prices fall, the put option could be exercised to offset all or a portion of the Fund's resulting losses. At the same time, because the maximum the Fund has at risk is the cost of the option, purchasing put options does not eliminate the potential for the Fund to profit from an increase in the value of the underlying portfolio securities. The Fund may write put options to earn additional income in the form of option premiums if it expects the price of the underlying instrument to remain stable or rise during the option period so that the option will not be exercised. The risk in this strategy is that the price of the underlying securities may decline by an amount greater than the premium received. Put options written are reported as a liability in the Statement of Assets and Liabilities. Realized and unrealized gains and losses on put options purchased and put options written are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities and Option contracts written, respectively. 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 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

25

Invesco High Yield Fund

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.

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, ISDA master agreements include 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. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund's exposure is unlimited.

Notional amounts of each individual credit default swap agreement outstanding as of February 29, 2020 for which the Fund is the seller of protection are disclosed in the open swap agreements table. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by the Fund for the same referenced entity or entities.

N.Other Risks - The current low interest rate environment was created in part by the Federal Reserve Board (FRB) and certain foreign central banks keeping the federal funds and equivalent foreign rates near historical lows. Increases in the federal funds and equivalent foreign rates may expose fixed income markets to heightened volatility and reduced liquidity for certain fixed income investments, particularly those with longer maturities. In addition, decreases in fixed income dealer market-making capacity may also potentially lead to heightened volatility and reduced liquidity in the fixed income markets. As a result, the value of the Fund's investments and share price may decline. Changes in central bank policies could also result in higher than normal shareholder redemptions, which could potentially increase portfolio turnover and the Fund's transaction costs. CLOs are subject to the risks of substantial losses due to actual defaults by underlying borrowers, which will be greater during periods of economic or financial stress. CLOs may also lose value due to collateral defaults and disappearance of subordinate tranches, market anticipation of defaults, and investor aversion to CLO securities as a class. The risks of CLOs will be greater if the Fund invests in CLOs that hold loans of uncreditworthy borrowers or if the Fund holds subordinate tranches of the CLO that absorbs losses from the defaults before senior tranches. In addition, CLOs are subject to interest rate risk and credit risk. The market values of convertible securities are affected by market interest rates, the risk of actual issuer default on interest or principal payments and the value of the underlying common stock into which the convertible security may be converted. Additionally, a convertible security is subject to the same types of market and issuer risks as apply to the underlying common stock. In addition, certain convertible securities are subject to involuntary conversions and may undergo principal write-downs upon the occurrence of certain triggering events, and, as a result, are subject to an increased risk of loss. Convertible securities may be rated below investment grade. 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. The Fund's foreign investments may be adversely affected by political and social instability, changes in economic or taxation policies, difficulty in enforcing obligations, decreased liquidity or increased volatility. Foreign investments also involve the risk of the possible seizure, nationalization or expropriation of the issuer or foreign deposits (in which the Fund could lose its entire investments in a certain market) and the possible adoption of foreign governmental restrictions such as exchange controls. Unless the Fund has hedged its foreign securities risk, foreign securities risk also involves the risk of negative foreign currency rate fluctuations, which may cause the value of securities denominated in such foreign currency (or other instruments through which the Fund has exposure to foreign currencies) to decline in value. Currency exchange rates may fluctuate significantly over short periods of time. Currency hedging strategies, if used, are not always successful. The Fund may invest in lower-quality debt securities, i.e., "junk bonds". Investments in lower-rated securities or unrated securities of comparable quality tend to be more sensitive to economic conditions than higher rated securities. Junk bonds involve a greater risk of default by the issuer because such securities are generally unsecured and are often subordinated to other creditors' claim. Mortgage- and asset-backed securities, including collateralized debt obligations and collateralized mortgage obligations, are subject to prepayment or call risk, which is the risk that a borrower's payments may be received earlier or later than expected due to changes in prepayment rates on underlying loans. This could result in the Fund reinvesting these early payments at lower interest rates, thereby reducing the Fund's income. Mortgage- and asset-backed securities also are subject to extension risk, which is the risk that an unexpected rise in interest rates could reduce the rate of prepayments, causing the price of the mortgage- and asset-backed securities and the Fund's share price to fall. An unexpectedly high rate of defaults on the mortgages held by a mortgage pool may adversely affect the value of mortgage-backed securities and could result in losses to the Fund. Privately-issued mortgage-backed securities and asset-backed securities may be less liquid than other types of securities and the Fund may be unable to sell these securities at the time or price it desires. The risk of a municipal obligation generally depends on the financial and credit status of the issuer. Constitutional amendments, legislative enactments, executive orders, administrative regulations, voter initiatives, and the issuer's regional economic conditions may affect the municipal security's value, interest payments, repayment of principal and the Fund's ability to sell the security. Failure of a municipal security issuer to comply with applicable tax requirements may make income paid thereon taxable, resulting in a decline in the security's value. In addition, there could be changes in applicable tax laws or tax treatments that reduce or eliminate the current federal income tax exemption on municipal securities or otherwise adversely affect the current federal or state tax status of municipal securities. Preferred securities are subject to issuer-specific and market risks applicable generally to equity securities. Preferred securities also may be subordinated to bonds or other debt instruments, subjecting them to a greater risk of non-payment, may be less liquid than many other securities, such as common stocks, and generally offer no voting rights with respect to the issuer.

O.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.

P.Collateral —To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund's practice to replace such collateral no later than the next business day.

26

Invesco High Yield Fund

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 $200 million

0.625%

 

 

Next $300 million

0.550%

 

 

Next $500 million

0.500%

Over $1 billion

0.450%

 

 

For the year ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.529%.

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, 2020, 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 Y, Investor Class, Class R5 and Class R6 shares to 1.50%, 2.25%, 1.25%, 1.50%, 1.25% and 1.25%, 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; (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, 2020. 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.

The Adviser has contractually agreed, through at least June 30, 2021, 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 year ended February 29, 2020, the Adviser waived advisory fees of $65,673.

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 year ended February 29, 2020, 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 year ended February 29, 2020, 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, 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 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 and 1.00% of the average daily net assets of Class C 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 year ended February 29, 2020, 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 year ended February 29, 2020, IDI advised the Fund that IDI retained $76,683 in front-end sales commissions from the sale of Class A shares and $10,498 and $1,178 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.

27

Invesco High Yield Fund

The following is a summary of the tiered valuation input levels, as of February 29, 2020. 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

 

 

 

 

 

 

 

 

 

U.S. Dollar Denominated Bonds & Notes

$

$

965,691,953

$0

$

965,691,953

 

Asset-Backed Securities

 

 

22,509,524

 

22,509,524

 

Exchange-Traded Funds

 

21,819,380

 

 

21,819,380

 

Variable Rate Senior Loan Interests

 

 

19,157,284

 

19,157,284

 

Non-U.S. Dollar Denominated Bonds & Notes

 

 

5,965,915

 

5,965,915

 

U.S. Treasury Securities

 

 

2,271,233

 

2,271,233

 

U.S. Government Sponsored Agency Mortgage-Backed Securities

 

 

780,344

 

780,344

 

 

Common Stocks & Other Equity Interests

 

12,526

 

4

 

12,530

 

 

Money Market Funds

 

35,605,045

 

 

35,605,045

 

Total Investments in Securities

 

57,436,951

 

1,016,376,253

4

 

1,073,813,208

 

Other Investments - Assets*

 

 

 

 

 

 

 

 

 

Investments Matured

 

 

0

 

0

 

 

Forward Foreign Currency Contracts

 

 

9,668

 

9,668

 

 

 

 

 

9,668

0

 

9,668

 

 

Other Investments - Liabilities*

 

 

 

 

 

 

 

 

 

Forward Foreign Currency Contracts

 

 

(158,283)

 

(158,283)

 

 

 

 

 

 

 

 

 

Swap Agreements

 

 

(394,046)

 

(394,046)

 

 

 

 

 

 

 

 

 

 

 

 

(552,329)

 

(552,329)

 

 

 

 

 

 

 

 

 

Total Other Investments

 

 

(542,661)

 

(542,661)

Total Investments

$

57,436,951

$1,015,833,592

$4

$1,073,270,547

 

*Forward foreign currency contracts and swap agreements are valued at unrealized appreciation (depreciation). Investments matured are shown at value.

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 February 29, 2020:

 

 

Value

 

 

Currency

Interest

 

Derivative Assets

Risk

Rate Risk

Total

Unrealized appreciation on forward foreign currency contracts outstanding

$

9,668

$

-

$

9,668

Derivatives not subject to master netting agreements

 

 

-

 

-

 

-

 

Total Derivative Assets subject to master netting agreements

$

9,668

$

-

$

9,668

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Value

 

 

 

 

 

 

 

Currency

 

Interest

 

 

 

 

Derivative Liabilities

 

 

Risk

 

Rate Risk

 

Total

 

Unrealized depreciation on swap agreements — OTC

$

-

$(394,046)

$(394,046)

 

 

 

 

 

 

 

 

 

Unrealized depreciation on forward foreign currency contracts outstanding

 

 

(158,283)

 

-

 

(158,283)

 

 

 

 

 

 

 

 

 

Total Derivative Liabilities

 

 

(158,283)

 

(394,046)

 

(552,329)

 

 

 

 

 

 

 

 

 

Derivatives not subject to master netting agreements

 

 

-

 

-

 

-

 

Total Derivative Liabilities subject to master netting agreements

$(158,283)

$(394,046)

$(552,329)

 

 

 

 

 

 

 

 

 

 

28

Invesco High Yield Fund

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 February 29, 2020.

 

 

 

 

 

 

 

 

 

 

 

Collateral

 

 

 

Financial Derivative Assets

 

 

Financial Derivative Liabilities

 

(Received/Pledged)

 

 

 

Forward

 

 

 

Forward

 

 

 

 

 

 

 

 

 

 

 

Foreign

 

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

Currency

 

 

Currency

 

Swap

Total

Net Value of

 

 

 

Net

Counterparty

Contracts

 

 

Contracts

Agreements

Liabilities

Derivatives

Non-Cash

Cash

Amount

 

Goldman Sachs International

$9,668

 

$(158,283)

$

$(158,283)

$(148,615)

$–

$–

$(148,615)

 

 

 

 

 

 

 

 

 

 

 

 

 

Morgan Stanley & Co. LLC

 

 

 

(499,749)

(499,749)

(499,749)

(499,749)

 

 

 

 

 

 

 

 

 

 

 

Total

$9,668

 

$(158,283)

$(499,749)

$(658,032)

$(648,364)

$–

$–

$(648,364)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effect of Derivative Investments for the year ended February 29, 2020

The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:

 

 

 

 

Location of Gain (Loss) on

 

 

 

 

 

 

 

 

Statement of Operations

 

 

 

 

 

 

Credit

 

Currency

 

Interest

 

 

 

 

 

 

Risk

 

Risk

 

Rate Risk

 

Total

Realized Gain (Loss):

 

 

 

 

 

 

 

 

 

 

Forward foreign currency contracts

$

-

$

720,414

$

-

$

720,414

 

Options purchased(a)

 

-

 

(1,489,586)

 

-

 

(1,489,586)

Options written

 

-

 

-

 

1,206,315

 

1,206,315

 

 

Swap agreements

 

2,417,757

 

-

 

(1,303,582)

 

1,114,175

 

 

Change in Net Unrealized Appreciation (Depreciation):

 

 

 

 

 

 

 

 

 

 

Forward foreign currency contracts

 

-

 

(94,538)

 

-

 

(94,538)

 

 

 

 

 

 

 

 

 

 

Swap agreements

 

(682,107)

 

-

 

(394,046)

 

(1,076,153)

 

 

 

 

 

 

 

 

 

 

 

Total

$

1,735,650

$

(863,710)

$

(491,313)

$

380,627

 

 

(a)Options purchased are included in the net realized gain (loss) from investment securities. The table below summarizes the average notional value of derivatives held during the period.

 

 

 

Foreign

 

 

 

Forward

 

Currency

 

 

 

Foreign Currency

Swaptions

Options

Swaptions

Swap

 

Contracts

Purchased

Purchased

Written

Agreements

Average notional value

$10,854,674

$140,871,429

$23,122,700

$121,471,429

$136,655,727

 

 

 

 

 

 

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $12,110.

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 may borrow for leveraging in an amount up to 5% of the Fund's total assets (excluding the amount borrowed) at the time the borrowing is made. In doing so, 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.

29

Invesco High Yield Fund

NOTE 8—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 29, 2020 and February 28, 2019:

 

 

2020

 

2019

 

 

Ordinary income

$65,906,573

 

$62,742,689

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

 

 

2020

 

 

Undistributed ordinary income

 

$

4,355,069

 

 

 

 

 

Net unrealized appreciation (depreciation) — investments

 

 

(56,029,865)

Net unrealized appreciation - foreign currencies

 

 

31,099

 

Temporary book/tax differences

 

 

(345,754)

 

 

 

 

 

Capital loss carryforward

 

 

(166,498,494)

Shares of beneficial interest

 

 

1,304,441,242

Total net assets

 

$1,085,953,297

 

 

 

 

 

 

 

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to book to tax accretion and amortization differences.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund has a capital loss carryforward as of February 29, 2020, as follows:

Capital Loss Carryforward*

Expiration

Short-Term

Long-Term

Total

Not subject to expiration

$56,282,480

$110,216,014

$166,498,494

*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 9—Investment Transactions

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the year ended February 29, 2020 was $646,614,683 and $698,966,861, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $8,411,674 and $8,940,000, 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

$ 29,882,027

 

Aggregate unrealized (depreciation) of investments

(85,911,892)

 

 

 

Net unrealized appreciation (depreciation) of investments

$(56,029,865)

 

 

 

 

Cost of investments for tax purposes is $1,129,300,412.

NOTE 10—Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of market discounts and defaulted bonds, on February 29, 2020, undistributed net investment income was increased by $7,166,613 and undistributed net realized gain (loss) was decreased by $7,166,613. This reclassification had no effect on the net assets or the distributable earnings (loss) of the Fund.

NOTE 11—Share Information

Summary of Share Activity

 

Year ended

Year ended

 

February 29, 2020(a)

 

February 28, 2019

 

Shares

Amount

Shares

Amount

Sold:

 

 

 

 

 

Class A

23,841,441

$ 97,035,143

25,858,723

$ 103,785,274

Class C

3,327,980

13,502,209

2,090,715

8,428,988

Class Y

7,578,729

30,934,255

25,840,783

104,305,214

Investor Class

12,534,765

50,900,080

7,727,438

31,014,518

Class R5

4,044,966

16,396,532

3,035,402

12,267,352

Class R6

10,619,933

43,170,211

9,073,020

36,708,703

30

Invesco High Yield Fund

Summary of Share Activity

 

Year ended

 

Year ended

 

February 29, 2020(a)

 

 

February 28, 2019

 

 

Shares

 

Amount

 

Shares

 

Amount

Issued as reinvestment of dividends:

 

 

 

 

 

 

 

 

 

 

Class A

7,073,317

$

28,695,757

6,648,792

$

26,840,856

 

Class C

324,143

 

1,311,503

595,394

 

2,397,035

 

 

Class Y

872,444

 

3,550,538

1,109,580

 

4,502,646

 

Investor Class

956,579

 

3,878,323

1,011,065

 

4,082,371

 

Class R5

931,449

 

3,764,899

935,850

 

3,768,412

 

 

Class R6

2,850,554

 

11,540,297

2,573,626

 

10,370,646

 

Automatic conversion of Class C shares to Class A shares:

 

 

 

 

 

 

 

 

 

 

Class A

1,137,000

 

4,626,129

-

 

-

 

 

Class C

(1,139,802)

 

(4,626,129)

-

 

-

 

 

Reacquired:

 

 

 

 

 

 

 

 

 

 

Class A

(33,465,100)

 

(135,821,370)

(33,374,204)

 

(134,783,996)

 

 

 

 

 

 

 

 

Class C

(2,762,570)

 

(11,202,598)

(14,958,720)

 

(59,822,320)

 

 

 

 

 

 

 

 

Class Y

(20,705,904)

 

(84,409,222)

(27,548,353)

 

(111,491,816)

 

 

 

 

 

 

 

 

Investor Class

(12,851,746)

 

(52,245,368)

(12,859,586)

 

(51,675,736)

 

 

 

 

 

 

 

 

Class R5

(6,925,624)

 

(28,081,599)

(6,201,655)

 

(24,973,961)

 

 

 

 

 

 

 

 

Class R6

(11,587,672)

 

(46,914,498)

(12,777,701)

 

(51,575,464)

 

 

 

 

 

 

 

 

Net increase (decrease) in share activity

(13,345,118)

$

(53,994,908)

(21,219,831)

$

(85,851,278)

 

 

 

 

 

 

 

 

 

 

 

(a)There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 37% of the outstanding shares of the Fund. IDI may have 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, 8% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser.

NOTE 12—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

31

Invesco High Yield Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco High Yield Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco High Yield Fund (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the five years in the period ended February 29, 2020 (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the five years in the period ended February 29, 2020 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, Texas

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

32

Invesco High Yield 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 September 1, 2019 through February 29, 2020.

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

 

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

 

Period2

Ratio

Class A

$1,000.00

$1,004.30

 

$5.08

$1,019.79

 

$5.12

1.02%

 

 

 

 

 

 

 

 

 

Class C

1,000.00

1,000.50

 

8.80

1,016.06

 

8.87

1.77

 

 

 

 

 

 

 

 

 

Class Y

1,000.00

1,005.70

 

3.84

1,021.03

 

3.87

0.77

 

 

 

 

 

 

 

 

 

Investor Class

1,000.00

1,004.30

 

5.08

1,019.79

 

5.12

1.02

Class R5

1,000.00

1,005.80

 

3.49

1,021.38

 

3.52

0.70

 

 

 

 

 

 

 

 

 

Class R6

1,000.00

1,006.30

 

3.04

1,021.83

 

3.07

0.61

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

33

Invesco High Yield Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Federal and State Income Tax

Qualified Dividend Income*

0.61%

Corporate Dividends Received Deduction*

0.48%

U.S. Treasury Obligations*

0.10%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

34

Invesco High Yield Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

T-1

Invesco High Yield Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

 

 

 

 

 

T-2

Invesco High Yield Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-3

Invesco High Yield Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-4

Invesco High Yield Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-5

Invesco High Yield Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-6

Invesco High Yield Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

State Street Bank and Trust Company

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

225 Franklin Street

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Boston, MA 02110-2801

T-7

Invesco High Yield Fund

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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 holdings four times in each fiscal year, at the quarter-ends. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 033-39519

Invesco Distributors, Inc.

HYI-AR-1

Annual Report to Shareholders

February 29, 2020

Invesco Income Fund

Nasdaq:

A: AGOVX ￿ C: AGVCX ￿ R: AGVRX ￿ Y: AGVYX ￿ Investor: AGIVX ￿ R5: AGOIX

￿R6: AGVSX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's web- site, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call (800) 959-4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

4 Performance Summary

6 Long-Term Fund Performance

8 Supplemental Information

9 Schedule of Investments

15 Financial Statements

18 Financial Highlights

19 Notes to Financial Statements

28Report of Independent Registered Public Accounting Firm

29Fund Expenses

30Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco Income Fund

Bruce Crockett

Dear Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco Income Fund

Management's Discussion of Fund Performance

Performance summary

For the fiscal year ended February 29, 2020, Class A shares of Invesco Income Fund (the Fund), at net asset value (NAV), underperformed the Bloomberg Bar- clays U.S. Aggregate Bond Index, the Fund's broad market benchmark.

Your Fund's long-term performance appears later in this report.

Fund vs. Indexes

Total returns, February 28, 2019 to February 29, 2020, 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

6.75%

Class C Shares

6.09

Class R Shares

6.61

Class Y Shares

7.14

Investor Class Shares

6.93

Class R5 Shares

7.24

Class R6 Shares

7.13

Bloomberg Barclays U.S. Aggregate Bond Index￿ (Broad Market Index)

11.68

Source(s): ￿RIMES Technologies Corp.

Risk assets performed well through most of the fiscal year, but experienced spread widen- ing as the fiscal year ended. Structured credit sectors such as non-agency MBS (RMBS), commercial mortgage-backed securities (CMBS) and asset-backed securities (ABS) outperformed US Treasuries, benefiting from a broadly bullish environment. Structured credit, along with other spread products, ben- efited from the Fed's decision to cut rates three times over the fiscal year. Investment grade corporate bonds performed well as solid corporate fundamentals and demand for high quality assets were robust. High yield corporate bonds also posted positive returns during the fiscal year as underlying company fundamentals remained supportive despite a weakening outlook for the energy and materi- als sector. Emerging market sovereign and corporate debt both produced posted positive returns for the fiscal year driven by easier financial conditions and the global hunt for yield as investors flocked to the asset class.

Market conditions and your Fund

The fiscal year proved to be an increasingly volatile time for the US bond market. US bonds posted strong nominal results for the fiscal year, as rates fell amid anxiety over a decelerating global economy, persistent trade disputes between the US and China and the spread of the new Coronavirus (COVID-19). Global risks remained throughout most of the fiscal year; however, in the final months of 2019, rates increased amid diminishing risks of imminent rate cuts by the US Federal Re- serve (the Fed), which were previously priced in. The global economy appeared to be stabi- lizing as trade disputes between the US and China, Brexit uncertainties and Chinese data all seemed less threatening to valuations. However, the final month of the fiscal year proved to bring on more volatility as the spread of the coronavirus wreaked havoc on financial markets and economies across the world. Equity markets fell steeply, and US Treasury yields plummeted as uncertainty regarding the spread and severity of the coronavirus put extreme pressure on risk as-

Portfolio Composition

By security type

% of total net assets

Asset-Backed Securities

 

68.82%

U.S. Government Sponsored

 

Agency Mortgage-Backed

 

 

Securities

 

12.15

Agency Credit Risk Transfer

 

Notes

 

10.38

U.S. Dollar Denominated Bonds

 

& Notes

 

7.73

Preferred Stocks

 

6.82

U.S. Treasury Securities

 

1.80

Common Stocks & Other Equity

 

Interests

 

1.73

Exchange-Traded Fund

 

1.00

Money Market Funds Plus Other

 

Assets Less Liabilities

 

(10.43)

sets causing investors to flock to perceived safe havens. The Fed cut interest rates three times during the fiscal year: in July, Septem- ber, and October 2019.1 At its December meeting, the Fed gave the clear indication that the target rate would likely remain at its current level through 2020 as factors that had driven risk aversion during 2019 had shown signs of improving. However, in Febru- ary 2020, Fed Chairman Jerome Powell made it clear that the Fed was prepared to act as coronavirus posed a new threat to eco- nomic activity.

In regard to rate movements during the fiscal year, the two-year US Treasury yield declined from 2.52% to 0.86%, the 10-year US Treasury yield decreased from 2.73% to 1.13% and the 30-year US Treasury yield decreased from 3.09% to 1.65%.2 The yield curve, as measured by the yield differential of the two-year US Treasury yield versus the

30-year US Treasury yield, steepened notably from 57 basis points to 79 basis points.2 (A basis point is one one-hundredth of a percent- age point.)

Top Five Debt Issuers

% of total net assets

1. Government National Mortgage

 

 

Association

11.3%

2.

Commercial Mortgage Trust

7.4

3.

Wells Fargo Commercial

 

 

Mortgage Trust

5.2

4.

Progress Residential Trust

5.1

5.

Invitation Homes Trust

4.2

Given this market backdrop, Class A shares of Invesco Income Fund, at NAV, generated a positive return but underperformed its broad market index, the Bloomberg Barclays

U.S. Aggregate Bond Index. The Fund's out- of-benchmark allocation to structured securi- ties, such as RMBS and ABS, contributed to relative Fund performance for the fiscal year. The Fund's out-of-benchmark allocation to real estate investment trust preferred and common equity was also a contributor to the Fund's relative performance.

During the fiscal year, the Fund used active duration and yield curve positioning for risk management and for generating returns. Du- ration measures a portfolio's price sensitivity to interest rate changes, with a shorter- duration portfolio tending to be less sensitive to these changes. Buying and selling US Trea- sury futures contracts was an important tool we used for the management of interest rate risk and to maintain the Fund's targeted port- folio duration. During the fiscal year, the Fund's duration and yield curve positioning were detractors from performance relative to the broad market benchmark. The Fund's

The Fund's holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.

Data presented here are as of February 29, 2020.

4Invesco Income Fund

security selection within investment grade corporates was also a detractor from relative Fund performance.

Please note that our strategy is imple- mented using derivative instruments, includ- ing futures and swaps. Therefore, a portion of the performance of the Fund, both positive and negative, can be attributed to these in- struments. Derivatives can be a cost-effective way to gain or hedge exposure to certain risks. However, derivatives may amplify tradi- tional investment risks through the creation of leverage and may be less liquid than tradi- tional securities.

We wish to remind you that the Fund is subject to interest rate risk, meaning when interest rates rise, the value of fixed income securities tends to fall. The risk may be greater in the current market environment because interest rates are near historic lows. The degree to which the value of fixed income securities may decline due to rising interest rates may vary depending on the speed and magnitude of the increase in interest rates, as well as individual security characteristics, such as price, maturity, duration and coupon and market forces, such as supply and de- mand for similar securities. We are monitor- ing interest rates and the market, economic and geopolitical factors that may impact the direction, speed and magnitude of changes to interest rates across the maturity spectrum, including the potential impact of monetary policy changes by the Fed and certain foreign central banks. If interest rates rise or fall faster than expected, markets may experience increased volatility, which may affect the value and/or liquidity of certain of the Fund's investments.

We welcome new investors who joined the Fund during the fiscal year and thank you for your investment in Invesco Income Fund.

1 Source: US Federal Reserve

2 Source: US Department of the Treasury

Portfolio Managers:

Philip Armstrong

Mario Clemente

Kevin Collins

Clint Dudley

David Lyle

Brian Norris

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

5Invesco Income Fund

Your Fund's Long-Term Performance

Results of a $10,000 Investment — Oldest Share Class(es)

Fund and index data from 2/28/10

$15,000

$14,707 Bloomberg Barclays U.S. Aggregate Bond Index1

12,000

 

 

 

$12,039 Invesco Income Fund — Class A Shares

 

 

 

9,000

2/28/10

2/11

2/12

2/13

2/14

2/15

2/16

2/17

2/18

2/19

2/20

1 Source: RIMES Technologies Corp.

Past performance cannot guarantee future results.

The data shown in the chart include rein- vested distributions, applicable sales charges and Fund expenses including management

fees. Index results include reinvested divi- dends, but they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses and management fees;

performance of a market index does not. Per- formance shown in the chart does not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares.

6Invesco Income Fund

Average Annual Total Returns

As of 2/29/20, including maximum applicable sales charges

Class A Shares

Inception (4/28/87)

4.80%

10 Years

1.87

5

Years

0.95

1

Year

2.19

Class C Shares

 

Inception (8/4/97)

3.48%

10 Years

1.57

5

Years

1.07

1

Year

5.09

Class R Shares

 

Inception (6/3/02)

3.03%

10 Years

2.09

5

Years

1.60

1

Year

6.61

Class Y Shares

 

Inception (10/3/08)

3.05%

10 Years

2.60

5

Years

2.08

1

Year

7.14

Investor Class Shares

 

Inception (9/30/03)

3.09%

10 Years

2.37

5

Years

1.89

1

Year

6.93

Class R5 Shares

 

Inception (4/29/05)

3.59%

10 Years

2.70

5

Years

2.21

1

Year

7.24

Class R6 Shares

 

10 Years

2.42%

5

Years

2.02

1

Year

7.13

Performance includes litigation proceeds. Had these proceeds not been received, total returns would have been lower.

Class R6 shares incepted on April 4, 2017. Performance shown prior to that date is that of Class A shares and includes the

12b-1 fees applicable to Class A shares. The performance data quoted represent

past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month- end performance. Performance figures re- flect reinvested distributions, changes in net asset value and the effect of the maxi- mum sales charge unless otherwise stated. Performance figures do not reflect deduc- tion of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.

Class A share performance reflects the maximum 4.25% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Investor Class, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; there- fore, performance is at net asset value.

The performance of the Fund's share classes will differ primarily due to different sales charge structures and class expenses. Fund performance reflects any applicable

fee waivers and/or expense reimburse- ments. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more informa- tion.

7Invesco Income Fund

Invesco Income Fund's investment objective is current income and, secondarily, capital appreciation.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

About indexes used in this report

￿The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index con- sidered representative of the US invest- ment grade, fixed-rate bond market.

￿The Fund is not managed to track the per- formance of any particular index, including the index(es) described here, and conse- quently, 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. Perfor- mance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.

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

8Invesco Income Fund

Schedule of Investments

February 29, 2020

 

Principal

 

 

Amount

Value

Asset-Backed Securities–68.82%

 

Adagio V CLO DAC, Series V-X, Class E,

 

 

3.20% (3 mo. EURIBOR + 3.20%),

 

 

10/15/2031(a)(b)

$ 4,000,000

$ 4,422,910

Angel Oak Mortgage Trust,

 

 

Series 2019-5, Class B1, 3.96%,

 

 

10/25/2049(a)(c)

2,361,000

2,440,188

Avoca CLO XX DAC, Series 20A,

 

 

Class D1, 3.90% (3 mo. EURIBOR +

 

 

3.90%), 07/15/2032(a)(b)

2,675,000

3,000,411

Banc of America Commercial Mortgage

 

 

Trust, Series 2015-UBS7, Class XA,

 

 

IO, 0.81%, 09/15/2048(c)

18,422,710

716,102

Bank, Series 2018-BN14, Class E,

 

 

3.00%, 09/15/2060(a)(c)

5,750,000

5,203,105

Bear Stearns Adjustable Rate Mortgage

 

 

Trust, Series 2004-10, Class 12A1,

 

 

3.83%, 01/25/2035(c)

490,215

496,932

Benchmark Mortgage Trust,

 

 

Series 2018-B6, Class E, 3.12%,

 

 

10/10/2051(a)(c)

8,000,000

7,139,190

Series 2019-B11, Class D, 3.00%,

 

 

05/15/2052(a)

5,250,000

4,889,453

Series 2019-B14, Class C, 3.78%,

 

 

12/15/2062

4,650,000

5,001,782

Blackbird Capital Aircraft Lease

 

 

Securitization Ltd., Series 2016-

 

 

1A, Class B, 5.68%,

 

 

12/16/2041(a)(c)(d)

5,182,813

5,361,090

CAL Funding III Ltd., Series 2018-1A,

 

 

Class B, 4.80%, 02/25/2043(a)

1,600,000

1,629,314

Cantor Commercial Real Estate

 

 

Lending,

 

 

Series 2019-CF1, Class 65D,

 

 

4.66%, 05/15/2052(a)(c)

4,517,000

4,650,435

Series 2019-CF2, Class E, 2.50%,

 

 

11/15/2052(a)

3,000,000

2,532,382

Cerberus Loan Funding XXV L.P.,

 

 

Series 2018-4RA, Class DR, 5.63%

 

 

(3 mo. USD LIBOR + 3.80%),

 

 

10/15/2030(a)(b)

2,100,000

2,029,933

Cerberus Loan Funding XXVI L.P.,

 

 

Series 2019-1A, Class D, 6.68% (3

 

 

mo. USD LIBOR + 4.85%),

 

 

04/15/2031(a)(b)

2,500,000

2,514,718

Chase Mortgage Finance Corp.,

 

 

Series 2016-SH1, Class M3,

 

 

3.75%, 04/25/2045(a)(c)

2,142,019

2,246,500

Series 2016-SH2, Class M3,

 

 

3.75%, 12/25/2045(a)(c)

2,735,464

2,864,187

Citigroup Commercial Mortgage Trust,

 

 

Series 2013-GC11, Class D,

 

 

4.42%, 04/10/2023(a)(c)

4,885,000

5,135,022

Series 2014-GC25, Class C,

 

 

4.53%, 10/10/2047(c)

4,000,000

4,323,477

Series 2015-GC29, Class D,

 

 

3.11%, 04/10/2048(a)

5,000,000

4,843,771

 

Principal

 

 

Amount

Value

Commercial Mortgage Trust,

 

 

Series 2014-CR16, Class C,

 

 

4.93%, 04/10/2047(c)

$10,000,000

$ 10,874,413

Series 2014-CR19, Class C,

 

 

4.73%, 08/10/2024(c)

4,578,800

4,957,847

Series 2014-UBS4, Class C, 4.64%,

 

 

07/10/2024(c)

5,000,000

5,321,120

Series 2015-CR24, Class B,

 

 

4.38%, 08/10/2048(c)

6,800,000

7,484,733

Series 2015-CR26, Class C,

 

 

4.48%, 10/10/2048(c)

4,000,000

4,378,396

CSAIL Commercial Mortgage Trust,

 

 

Series 2016-C6, Class E, 3.92%,

 

 

01/15/2049(a)(c)

3,000,000

2,545,890

Series 2017-CX9, Class D, 4.15%,

 

 

09/15/2050(a)(c)

6,304,000

6,224,093

Series 2018-C14, Class E, 4.89%,

 

 

11/15/2051(a)(c)

4,548,000

4,737,942

CVC Cordatus Loan Fund XIV DAC,

 

 

Series 14A, Class C1, 2.65% (3

 

 

mo. EURIBOR + 2.65%),

 

 

05/22/2032(a)(b)

1,000,000

1,115,162

DB Master Finance LLC,

 

 

Series 2019-1A, Class A23,

 

 

4.35%, 05/20/2049(a)

3,136,300

3,376,552

Diamond CLO Ltd., Series 2019-1A,

 

 

Class D, 6.54% (3 mo. USD LIBOR +

 

 

4.75%), 04/25/2029(a)(b)

3,000,000

3,006,583

Flagstar Mortgage Trust,

 

 

Series 2018-5, Class B1, 4.54%,

 

 

09/25/2048(a)(c)

1,653,766

1,822,476

Series 2018-5, Class B2, 4.54%,

 

 

09/25/2048(a)(c)

1,981,601

2,150,368

Series 2018-6RR, Class B2,

 

 

5.01%, 10/25/2048(a)(c)

2,925,920

3,369,229

Series 2018-6RR, Class B3,

 

 

5.01%, 10/25/2048(a)(c)

2,925,920

3,277,436

Galton Funding Mortgage Trust,

 

 

Series 2019-H1, Class B1, 3.89%,

 

 

10/25/2059(a)(c)

5,480,000

5,566,273

GCAT Trust, Series 2019-NQM3,

 

 

Class B1, 3.95%, 11/25/2059(a)(c)

4,000,000

4,045,706

GPT Mortgage Trust, Series 2018-GPP,

 

 

Class D, 3.51% (1 mo. USD LIBOR +

 

 

1.85%), 06/15/2035(a)(b)

159,196

157,929

GS Mortgage Securities Corp. Trust,

 

 

Series 2017-SLP, Class E, 4.59%,

 

 

10/10/2032(a)(c)

5,050,000

5,171,177

Series 2018-TWR, Class G, 5.58%

 

 

(1 mo. USD LIBOR + 3.92%),

 

 

07/15/2021(a)(b)

3,000,000

3,026,357

Hertz Vehicle Financing II L.P.,

 

 

Series 2016-4A, Class C, 5.06%,

 

 

07/25/2022(a)

6,000,000

6,195,829

Holland Park CLO DAC (Ireland),

 

 

Class C, 4.40% (3 mo. EURIBOR +

 

 

4.40%), 11/14/2032(a)(b)

2,000,000

2,227,550

Class D, 7.03% (3 mo. EURIBOR +

 

 

7.03%), 11/14/2032(a)(b)

2,000,000

2,260,643

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco Income Fund

 

Principal

 

 

Amount

Value

Home Partners of America Trust,

 

 

Series 2017-1, Class E, 4.31% (1

 

 

mo. USD LIBOR + 2.65%),

 

 

07/17/2034(a)(b)

$ 5,000,000

$ 5,020,436

Horizon Aircraft Finance III Ltd.,

 

 

Series 2019-2, Class B, 4.46%,

 

 

11/15/2039(a)

1,976,190

2,007,047

Invitation Homes Trust,

 

 

Series 2018-SFR1, Series E, 3.66%

 

 

(1 mo. USD LIBOR + 2.00%),

 

 

03/17/2037(a)(b)

6,056,172

6,070,793

Series 2018-SFR2, Class E, 3.66%

 

 

(1 mo. USD LIBOR + 2.00%),

 

 

06/17/2037(a)(b)

5,000,000

4,984,022

Series 2018-SFR4, Series E, 3.61%

 

 

(1 mo. USD LIBOR + 1.95%),

 

 

01/17/2038(a)(b)

4,000,000

4,018,020

Series 2018-SFR4, Series F, 3.86%

 

 

(1 mo. USD LIBOR + 2.20%),

 

 

01/17/2038(a)(b)

4,000,000

4,008,637

Jimmy Johns Funding LLC,

 

 

Series 2017-1A, Class A2II,

 

 

4.85%, 07/30/2047(a)

6,337,500

6,921,782

JP Morgan Chase Commercial Mortgage

 

 

Securities Trust,

 

 

Series 2018-PHH, Class E, 4.07%

 

 

(1 mo. USD LIBOR + 2.41%),

 

 

06/15/2020(a)(b)

2,000,000

1,997,690

Series 2018-PHH, Class F, 4.67%

 

 

(1 mo. USD LIBOR + 3.01%),

 

 

06/15/2020(a)(b)

2,000,000

1,997,102

Series 2018-WPT, Class DFL,

 

 

3.92% (1 mo. USD LIBOR +

 

 

2.25%), 07/05/2033(a)(b)

3,000,000

3,006,605

JPMBB Commercial Mortgage

 

 

Securities Trust, Series 2014-C26,

 

 

Class D, 3.88%, 12/15/2024(a)(c)

4,000,000

4,016,062

MACH 1 Cayman Ltd., Series 2019-1,

 

 

Class B, 4.34%, 10/15/2039(a)

2,191,861

2,217,266

Morgan Stanley Bank of America Merrill

 

 

Lynch Trust,

 

 

Series 2015-C20, Class D, 3.07%,

 

 

02/15/2048(a)

3,200,000

3,079,295

Series 2015-C24, Class D, 3.26%,

 

 

07/15/2025(a)

5,000,000

4,848,188

Morgan Stanley Capital I Trust,

 

 

Series 2018-H4, Class C, 5.08%,

 

 

12/15/2051(c)

5,000,000

5,907,176

Progress Residential Trust,

 

 

Series 2017-SFR2, Class D, 3.60%,

 

 

12/17/2034(a)

3,413,000

3,454,600

Series 2017-SFR2, Class E, 4.14%,

 

 

12/17/2034(a)

3,000,000

3,048,810

Series 2018-SFR1, Class F, 4.78%,

 

 

03/17/2035(a)

525,000

535,893

Series 2018-SFR2, Class E, 4.66%,

 

 

08/17/2035(a)

3,000,000

3,101,393

Series 2018-SFR3, Class D, 4.43%,

 

 

10/17/2035(a)

7,000,000

7,263,383

Series 2019-SFR1, Class E, 4.47%,

 

 

08/17/2035(a)

5,000,000

5,221,381

Residential Mortgage Loan Trust,

 

 

Series 2019-1, Class M1, 4.59%,

 

 

10/25/2058(a)(c)

5,000,000

5,117,110

Series 2019-3, Class B1, 3.81%,

 

 

09/25/2059(a)(c)

3,276,000

3,294,812

 

Principal

 

 

Amount

Value

Sapphire Aviation Finance II Ltd.,

 

 

Series 2020-1A, Class B, 4.34%,

 

 

03/15/2040(a)

$ 3,250,000

$ 3,238,274

Seasoned Credit Risk Transfer Trust,

 

 

Series 2017-4, Class M, 4.75%,

 

 

06/25/2057(a)(c)

3,000,000

3,174,322

Sonic Capital LLC, Series 2020-1A,

 

 

Class A2I, 3.85%, 01/20/2050(a)

2,713,000

2,814,913

Taco Bell Funding LLC, Series 2018-

 

 

1A, Class A2I, 4.32%,

 

 

11/25/2048(a)

4,443,750

4,590,705

Textainer Marine Containers V Ltd.,

 

 

Series 2017-2A, Class B, 4.75%,

 

 

06/20/2042(a)

1,731,296

1,793,444

Textainer Marine Containers VII Ltd.,

 

 

Series 2018-1A, Class B, 4.93%,

 

 

07/20/2043(a)

1,002,220

1,046,577

Thunderbolt II Aircraft Lease Ltd.,

 

 

Series 2018-A, Class B, 5.07%,

 

 

09/15/2038(a)(c)(d)

4,494,048

4,677,518

Tricon American Homes Trust,

 

 

Series 2018-SFR1, Class D, 4.17%,

 

 

05/17/2037(a)

2,000,000

2,131,770

Triton Container Finance VI LLC,

 

 

Series 2018-2A, Class A, 5.05%,

 

 

06/22/2043(a)

3,750,000

3,786,611

Voya CLO Ltd., Series 2014-1A,

 

 

Class CR2, 4.62% (3 mo. USD LIBOR

 

 

+ 2.80%), 04/18/2031(a)(b)

1,300,000

1,249,326

Wells Fargo Commercial Mortgage Trust,

 

 

Series 2014-LC18, Class D, 3.96%,

 

 

12/15/2024(a)(c)

6,000,000

5,890,861

Series 2015-C28, Class B, 4.11%,

 

 

05/15/2048(c)

7,100,000

7,817,716

Series 2015-NXS2, Class D, 4.31%,

 

 

07/15/2025(c)

6,000,000

6,273,134

Series 2017-RC1, Class D, 3.25%,

 

 

01/15/2060(a)

4,000,000

3,753,577

Wendy's Funding LLC, Series 2015-1A,

 

 

Class A23, 4.50%, 06/15/2045(a)

4,787,500

4,951,858

Total Asset-Backed Securities (Cost $297,331,601)

313,062,715

U.S. Government Sponsored Agency Mortgage-Backed Securities–12.15%

Collateralized Mortgage Obligations–0.65%

 

Fannie Mae REMICs,

 

 

2.25%, 02/25/2021

261

261

Freddie Mac Multifamily Connecticut

 

 

Avenue Securities Trust,

 

 

Series 2019-01, Class M10,

 

 

4.88% (1 mo. USD LIBOR +

 

 

3.25%), 10/15/2049(a)(b)

1,333,000

1,392,502

Series 2019-01, Class B10,

 

 

7.13% (1 mo. USD LIBOR +

 

 

5.50%), 10/15/2049(a)(b)

1,500,000

1,566,723

 

 

2,959,486

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco Income Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Federal Home Loan Mortgage Corp. (FHLMC)–0.01%

10.00%, 04/01/2020

$

191

$

191

4.50%, 09/01/2020

 

442

 

442

9.50%, 11/01/2020 to

 

 

 

 

04/01/2025

 

5,806

 

5,923

9.00%, 06/01/2021 to

 

 

 

 

04/01/2025

 

28,328

 

31,058

6.50%, 06/01/2029 to

 

 

 

 

08/01/2032

 

4,001

 

4,509

7.00%, 03/01/2032 to

 

 

 

 

05/01/2032

 

1,289

 

1,391

 

 

 

 

43,514

Federal National Mortgage Association (FNMA)–0.04%

5.50%, 03/01/2021

 

12

 

12

10.00%, 12/20/2021

 

864

 

874

9.50%, 08/01/2022 to

 

 

 

 

04/20/2025

 

195

 

196

6.00%, 04/01/2024

 

323

 

358

6.75%, 07/01/2024

 

111,979

 

124,978

6.95%, 07/01/2025 to

 

 

 

 

10/01/2025

 

27,814

 

28,017

6.50%, 01/01/2026 to

 

 

 

 

10/01/2036

 

7,028

 

7,917

7.00%, 06/01/2029 to

 

 

 

 

02/01/2032

 

1,838

 

1,899

8.00%, 10/01/2029

 

32

 

38

 

 

 

 

164,289

Government National Mortgage Association (GNMA)–11.45%

9.00%, 04/15/2021

 

2

 

2

8.00%, 11/15/2021 to

 

 

 

 

02/15/2036

 

638,100

 

735,901

7.00%, 01/15/2023 to

 

 

 

 

12/15/2036

 

517,217

 

552,393

9.50%, 03/15/2023

 

988

 

992

6.50%, 07/15/2024 to

 

 

 

 

09/15/2032

 

78,060

 

81,235

10.00%, 07/15/2024

 

38

 

38

6.95%, 07/20/2025 to

 

 

 

 

11/20/2026

 

156,031

 

163,572

6.00%, 11/15/2031

 

744

 

825

8.50%, 01/15/2037

 

16,240

 

16,779

TBA,

 

 

 

 

2.50%, 03/01/2050

 

14,000,000

 

14,376,250

3.00%, 03/01/2050

 

35,000,000

 

36,164,843

 

 

 

 

52,092,830

Total U.S. Government Sponsored Agency

 

 

Mortgage-Backed Securities (Cost $54,582,599)

 

55,260,119

Agency Credit Risk Transfer Notes–10.38%

 

 

Fannie Mae Connecticut Avenue Securities

 

 

 

 

7.13% (1 mo. USD LIBOR +

 

 

 

 

5.50%), 09/25/2029(b)

 

3,825,000

 

4,502,752

5.18% (1 mo. USD LIBOR +

 

 

 

 

3.55%), 07/25/2030(b)

 

5,000,000

 

5,303,511

3.83% (1 mo. USD LIBOR +

 

 

 

 

2.20%), 08/25/2030(b)

 

1,291,040

 

1,304,913

6.13% (1 mo. USD LIBOR +

 

 

 

 

4.50%), 12/25/2030(b)

 

3,500,000

 

3,922,626

Series 2019-R02, Class 1B1,

 

 

 

 

5.78% (1 mo. USD LIBOR +

 

 

 

 

4.15%), 08/25/2031(a)(b)

 

6,956,000

 

7,521,631

 

 

Principal

 

 

 

Amount

Value

Freddie MacSeries 2018-HQA1,

 

 

 

Class M2, STACR®, 3.93% (1 mo.

 

 

 

USD LIBOR + 2.30%),

 

 

 

09/25/2030(b)

$

5,000,000

$ 5,051,957

Freddie Mac Structured Agency Credit Risk

 

 

 

Debt Notes

 

 

 

Series 2017-DNA2, Class B1,

 

 

 

STACR®, 6.78% (1 mo. USD LIBOR +

 

 

 

5.15%), 10/25/2029(b)

 

805,000

925,424

Series 2018-HRP2, Class M3,

 

 

 

STACR®, 4.03% (1 mo. USD LIBOR +

 

 

 

2.40%), 02/25/2047(a)(b)

 

5,000,000

5,110,513

Series 2018-SPI3, Class M1,

 

 

 

STACR®, 4.15% 08/25/2048(a)(c)

 

864,953

869,945

Golub Capital Partners CLO 34M Ltd.,

 

 

 

(Cayman Islands), Series 2017-

 

 

 

34A, Class CR, 5.39% (3 mo. USD

 

 

 

LIBOR + 3.65%), 03/14/2031(a)(b)

 

5,000,000

5,010,324

Madison Park Euro Funding XIII DAC,

 

 

 

(Ireland), Series 13A, 2.60% (3

 

 

 

mo. EURIBOR + 2.60%),

 

 

 

01/15/2032(a)(b)

 

2,400,000

2,667,983

Strata CLO I Ltd., (Cayman Islands),

 

 

 

Series 2018-1A, Class D, 5.89% (3

 

 

 

mo. USD LIBOR + 4.06%),

 

 

 

01/15/2031(a)(b)

 

5,000,000

5,037,095

Total Agency Credit Risk Transfer Notes

 

 

(Cost $46,500,693)

 

 

47,228,674

U.S. Dollar Denominated Bonds & Notes–7.73%

Airlines–0.43%

Latam Finance Ltd. (Chile), 7.00%,

 

 

03/01/2026(a)

1,970,000

1,973,615

Diversified Banks–0.87%

 

 

Banco Santander Mexico S.A.

 

 

Institucion de Banca Multiple Grupo

 

 

Financiero Santander (Mexico),

 

 

5.95% (5yr. U.S. Treasury Yield

 

 

Curve Rate + 3.00%),

 

 

10/01/2028(a)(b)

2,500,000

2,710,269

Lloyds Banking Group PLC (United

 

 

Kingdom), 7.50%(e)

1,110,000

1,235,646

 

 

3,945,915

Diversified Capital Markets–0.61%

 

 

Credit Suisse Group AG (Switzerland),

 

 

7.25%(a)(e)

2,500,000

2,764,237

Electric Utilities–0.58%

 

 

Inkia Energy Ltd. (Peru), 5.88%,

 

 

11/09/2027(a)

2,500,000

2,621,875

Electronic Components–1.23%

 

 

Corning, Inc., 5.45%, 11/15/2079

5,000,000

5,591,406

Integrated Oil & Gas–0.22%

 

 

Petroleos Mexicanos (Mexico), 6.84%,

 

 

01/23/2030(a)

971,000

1,016,394

Marine–0.45%

 

 

Hidrovias International Finance S.a.r.l.

 

 

(Brazil), 5.95%, 01/24/2025(a)

2,000,000

2,054,170

Oil & Gas Exploration & Production–0.46%

 

Canacol Energy Ltd. (Colombia),

 

 

7.25%, 05/03/2025(a)

2,000,000

2,095,830

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco Income Fund

 

 

Principal

 

 

 

Amount

Value

Oil & Gas Refining & Marketing–0.43%

 

Puma International Financing S.A.

 

 

(Singapore), 5.13%,

 

 

10/06/2024(a)

$ 2,000,000

$ 1,954,044

Packaged Foods & Meats–0.69%

 

 

NBM US Holdings, Inc. (Brazil), 7.00%,

 

 

05/14/2026(a)

3,000,000

3,142,117

Real Estate Development–0.60%

 

 

Longfor Group Holdings Ltd. (China),

 

 

4.50%, 01/16/2028(a)

2,500,000

2,701,999

Sovereign Debt–1.16%

 

 

Dominican Republic International Bond

 

 

(Dominican Republic), 6.88%,

 

 

01/29/2026(a)

2,500,000

2,850,894

Oman Government International Bond

 

 

(Oman), 4.75%, 06/15/2026(a)

2,500,000

2,442,225

 

 

 

5,293,119

Total U.S. Dollar Denominated Bonds & Notes

 

 

(Cost $32,730,565)

 

35,154,721

Preferred Stocks–6.82%

Shares

 

 

 

Mortgage REITs–6.82%

 

 

AG Mortgage Investment Trust, Inc.,

 

 

8.00%, Series C, Pfd.

150,000

3,789,000

Annaly Capital Management, Inc., 6.50%,

 

 

Series G, Pfd.

100,000

2,386,000

Dynex Capital, Inc., 7.63%, Series B, Pfd.

17,352

432,065

Dynex Capital, Inc., 6.90%, Series C, Pfd.

160,000

3,963,200

MFA Financial, Inc., 6.50%, Series C, Pfd.

150,000

3,633,000

New Residential Investment Corp., 7.13%,

 

 

Series B, Pfd.

100,000

2,493,000

New York Mortgage Trust, Inc., 7.88%,

 

 

Series C, Pfd.

143,616

3,590,400

New York Mortgage Trust, Inc., 8.00%,

 

 

Series D, Pfd.

175,000

4,345,250

PennyMac Mortgage Investment Trust,

 

 

8.00%, Series B, Pfd.

100,000

2,540,000

Investment Abbreviations:

 

 

CLO

– Collateralized Loan Obligation

 

 

ETF

– Exchange-Traded Fund

 

 

EURIBOR – Euro Interbank Offered Rate

 

 

IO

– Interest Only

 

 

LIBOR

– London Interbank Offered Rate

 

 

Pfd.

– Preferred

 

 

REIT

– Real Estate Investment Trust

 

 

REMICs

– Real Estate Mortgage Investment Conduits

 

STACR® – Structured Agency Credit Risk

 

 

TBA

– To Be Announced

 

 

USD

– U.S. Dollar

 

 

 

 

Shares

 

Value

Mortgage REITs–(continued)

 

 

 

 

 

Two Harbors Investment Corp., 7.25%,

 

 

 

 

 

Series C, Pfd.

 

150,000

$

3,844,500

 

Total Preferred Stocks (Cost $31,144,210)

 

31,016,415

 

 

 

Principal

 

 

 

U.S. Treasury Securities–1.80%

Amount

 

 

 

 

 

 

 

U.S. Treasury Bills–0.34%

 

 

 

 

 

1.50% - 1.57%, 04/09/2020(f)(g)

$

1,550,000

 

1,547,461

 

U.S. Treasury Notes–1.46%

 

 

 

 

 

1.75%, 11/15/2029

 

6,300,000

 

6,653,145

 

Total U.S. Treasury Securities (Cost $7,903,078)

 

8,200,606

 

 

 

Shares

 

 

 

Common Stocks & Other Equity Interests–1.73%

Mortgage REITs–1.73%

 

 

 

 

 

New Residential Investment Corp.

 

100,000

 

1,556,000

 

New York Mortgage Trust, Inc.

 

800,000

 

4,560,000

 

PennyMac Mortgage Investment Trust

 

85,000

 

1,759,500

 

 

 

 

 

7,875,500

 

Total Common Stocks & Other Equity Interests

 

 

 

(Cost $8,495,646)

 

 

 

7,875,500

 

Exchange-Traded Funds–1.00%

 

 

 

 

Invesco Senior Loan ETF

 

 

 

 

 

(Cost $ 4,712,810)

 

207,000

 

4,551,930

 

Money Market Funds–0.92%

 

 

 

 

 

Invesco Government & Agency Portfolio,

 

 

 

 

 

Institutional Class, 1.50%(h)

 

2,515,116

 

2,515,116

 

Invesco Treasury Portfolio, Institutional

 

 

 

 

 

Class, 1.48%(h)

 

1,676,744

 

1,676,744

 

Total Money Market Funds (Cost $4,191,860)

 

4,191,860

 

TOTAL INVESTMENTS IN SECURITIES–111.35%

 

 

 

 

(Cost $487,593,062)

 

 

 

506,542,540

 

OTHER ASSETS LESS LIABILITIES—(11.35)%

 

 

 

(51,612,429)

NET ASSETS–100.00%

 

 

$454,930,111

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco Income Fund

Notes to Schedule of Investments:

(a)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 February 29, 2020 was $307,014,272, which represented 67.49% of the Fund's Net Assets.

(b)Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on February 29, 2020.

(c)Interest rate is redetermined periodically based on the cash flows generated by the pool of assets backing the security, less any applicable fees. The rate shown is the rate in effect on February 29, 2020.

(d)Step coupon bond. The interest rate represents the coupon rate at which the bond will accrue at a specified future date.

(e)Perpetual bond with no specified maturity date.

(f)All or a portion of the value was pledged as collateral to cover margin requirements for open futures contracts. See Note 1J.

(g)Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund.

(h)The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of February 29, 2020.

Open Futures Contracts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized

Short Futures Contracts

 

 

 

Number of

Expiration

Notional

 

 

 

 

Appreciation

 

 

 

Contracts

Month

Value

 

 

Value

(Depreciation)

Interest Rate Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury Long Bonds

 

 

 

24

June-2020

$ (4,086,000)

$

 

(85,552)

$ (85,552)

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury 5 Year Notes

 

 

 

944

June-2020

(115,876,000)

 

(1,086,031)

(1,086,031)

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury 10 Year Notes

 

 

 

387

June-2020

(52,148,250)

 

 

(600,098)

(600,098)

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury 10 Year Ultra Bonds

 

 

 

164

June-2020

(24,635,875)

 

 

(394,912)

(394,912)

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Futures Contracts

 

 

 

 

 

 

 

 

$(2,166,593)

$(2,166,593)

 

 

 

Open Forward Foreign Currency Contracts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contract to

 

 

 

Unrealized

Settlement

 

 

 

 

 

 

 

 

 

 

 

Appreciation

Date

Counterparty

 

 

 

 

 

 

Deliver

 

 

Receive

(Depreciation)

Currency Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

05/29/2020

Goldman Sachs & International

 

 

 

 

 

EUR 13,696,074

USD 14,947,279

$(247,941)

 

 

 

 

 

 

 

 

 

 

 

 

 

Open Centrally Cleared Credit Default Swap Agreements

 

 

 

 

 

 

 

 

 

 

(Pay)/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receive

 

 

Implied

 

 

Upfront

 

 

 

Unrealized

 

 

Buy/Sell

Fixed

Payment

 

Credit

 

 

Payments Paid

 

 

Appreciation

Reference Entity

 

Protection

Rate

Frequency

Maturity Date

Spread(a)

Notional Value

(Received)

 

Value

(Depreciation)

Credit Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Markit CDX North America High Yield

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Index, Series 33, Version 2

Buy

(5.00)%

Quarterly

12/20/2024

3.77%

USD 49,500,000

$(2,417,773)

$(2,676,316)

$(258,543)

 

(a)Implied credit spreads represent the current level, as of February 29, 2020, at which protection could be bought or sold given the terms of the existing credit default swap agreement and serve as an indicator of the current status of the payment/performance risk of the credit default swap agreement. An implied credit spread that has widened or increased since entry into the initial agreement 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 generally.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco Income Fund

Open Over-The-Counter Credit Default Swap Agreements

 

 

 

(Pay)/

 

 

Implied

 

 

Upfront

 

 

 

Unrealized

 

 

Buy/Sell

Receive

Payment

Maturity

Credit

Notional

Payments Paid

 

 

Appreciation

Counterparty

Reference Entity

Protection

Fixed Rate

Frequency

Date

Spread(a)

Value

(Received)

 

Value

(Depreciation)

Credit Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

Morgan Stanley

 

 

 

 

 

 

 

 

 

 

 

 

 

& Co.

 

 

 

 

 

 

 

 

 

 

 

 

 

International

Markit CMBX North America BBB-

 

 

 

 

 

 

 

 

 

 

 

 

PLC

Index, Series 7, Version 1

Sell

3.00%

Monthly

01/17/2047

3.65%

$ 10,000,000

$(303,208)

$

(220,490)

$

82,718

Subtotal—Appreciation

 

 

 

 

 

 

 

(303,208)

 

(220,490)

 

82,718

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

J.P. Morgan

 

 

 

 

 

 

 

 

 

 

 

 

 

Chase Bank,

Markit CMBX North America A

 

 

 

 

 

 

 

 

 

 

 

 

N.A.

Index, Series 13, Version 1

Sell

2.00%

Monthly

12/16/2072

2.23%

$ 25,000,000

$

23,987

$

(469,781)

$

(493,768)

J.P. Morgan

Markit CMBX North America A

 

 

 

 

 

 

 

 

 

 

 

 

Chase Bank,

 

 

 

 

 

 

 

 

 

 

 

 

N.A.

Index, Series 13, Version 1

Sell

2.00%

Monthly

12/16/2072

2.23%

$ 20,000,000

$

161,223

$

(375,825)

$

(537,048)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Merrill Lynch

Markit CMBX North America A

 

 

 

 

 

 

 

 

 

 

 

 

International

Index, Series 12, Version 1

Sell

2.00%

Monthly

08/17/2061

2.10%

$ 15,000,000

$

54,633

$

(118,350)

$

(172,983)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Merrill Lynch

Markit CMBX North America A

 

 

 

 

 

 

 

 

 

 

 

 

International

Index, Series 12, Version 1

Sell

2.00%

Monthly

08/17/2061

2.10%

$ 10,000,000

$

88,731

$

(78,900)

$

(167,631)

Merrill Lynch

Markit CMBX North America BBB

 

 

 

 

 

 

 

 

 

 

 

 

International

Index, Series 12, Version 1

Sell

3.00%

Monthly

08/17/2061

3.79%

$ 10,000,000

$

(141,684)

$

(558,179)

$

(416,495)

 

 

 

 

 

 

 

 

 

 

 

 

 

Subtotal—Depreciation

 

 

 

 

 

 

 

186,890

 

(1,601,035)

 

(1,787,925)

 

 

 

 

 

 

 

 

 

Total Open Over-The-Counter Credit Default Swap Agreements

 

 

 

 

$

(116,318)

$(1,821,525)

$(1,705,207)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a)Implied credit spreads represent the current level, as of February 29, 2020, at which protection could be bought or sold given the terms of the existing credit default swap agreement and serve as an indicator of the current status of the payment/performance risk of the credit default swap agreement. An implied credit spread that has widened or increased since entry into the initial agreement 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 generally.

Abbreviations:

EUR —Euro

USD —U.S. Dollar

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

14

Invesco Income Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

Investments in securities, at value

 

(Cost $483,401,202)

$502,350,680

Investments in affiliated money market funds, at value

 

(Cost $4,191,860)

4,191,860

Other investments:

 

Unrealized appreciation on swap agreements — OTC

82,718

Deposits with brokers:

 

Cash collateral — OTC Derivatives

640,000

Foreign currencies, at value (Cost $329,578)

330,731

Receivable for:

 

Investments sold

4,623,444

Fund shares sold

527,862

Dividends

172,235

Interest

1,772,033

Principal paydowns

326

Investment for trustee deferred compensation and

 

retirement plans

224,136

Other assets

39,217

Total assets

514,955,242

Liabilities:

 

Other investments:

 

Variation margin payable - futures contracts

1,842,203

Variation margin payable — centrally cleared swap

 

agreements

258,543

Premiums received on swap agreements — OTC

116,318

Unrealized depreciation on forward foreign currency

 

contracts outstanding

247,941

Swaps payable — OTC

158,243

Unrealized depreciation on swap agreements—OTC

1,787,925

Payable for:

 

Investments purchased

53,798,171

Dividends

216,484

Fund shares reacquired

921,780

Amount due custodian

10,391

Accrued fees to affiliates

289,772

Accrued trustees' and officers' fees and benefits

2,846

Accrued other operating expenses

132,867

Trustee deferred compensation and retirement plans

241,647

Total liabilities

60,025,131

Net assets applicable to shares outstanding

$454,930,111

Net assets consist of:

 

 

 

Shares of beneficial interest

$

480,615,704

 

Distributable earnings (loss)

 

(25,685,593)

 

$454,930,111

 

Net Assets:

 

 

 

Class A

$405,061,115

 

Class C

$

9,555,876

 

Class R

$

4,442,584

 

Class Y

$

10,540,011

 

Investor Class

$

24,786,531

 

Class R5

$

507,701

 

Class R6

$

36,293

 

Shares outstanding, no par value, with an unlimited number of shares authorized:

Class A

 

46,671,793

Class C

 

1,100,957

Class R

 

511,201

Class Y

 

1,212,310

Investor Class

 

2,852,090

Class R5

 

58,477

Class R6

 

4,185

Class A:

 

 

Net asset value per share

$

8.68

Maximum offering price per share

 

 

(Net asset value of $8.68 ÷ 95.75%)

$

9.07

Class C:

 

 

Net asset value and offering price per share

$

8.68

Class R:

 

 

Net asset value and offering price per share

$

8.69

Class Y:

 

 

Net asset value and offering price per share

$

8.69

Investor Class:

 

 

Net asset value and offering price per share

$

8.69

Class R5:

 

 

Net asset value and offering price per share

$

8.68

Class R6:

 

 

Net asset value and offering price per share

$

8.67

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

15

Invesco Income Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

 

Interest

$20,624,392

Dividends

3,129,290

Dividends from affiliated money market funds

68,245

 

Total investment income

23,821,927

Expenses:

 

 

 

Advisory fees

2,075,453

 

Administrative services fees

66,777

 

Custodian fees

35,616

 

Distribution fees:

 

 

 

Class A

1,041,564

 

Class C

97,379

 

Class R

29,066

 

Investor Class

47,363

 

Transfer agent fees — A, C, R, Y and Investor

979,537

 

Transfer agent fees — R5

850

 

Transfer agent fees — R6

35

 

Trustees' and officers' fees and benefits

25,127

 

Registration and filing fees

106,993

 

Reports to shareholders

129,692

 

Professional services fees

63,451

 

Other

24,947

 

Total expenses

4,723,850

 

Less: Fees waived and/or expense offset arrangement(s)

(14,955)

Net expenses

4,708,895

 

Net investment income

19,113,032

Realized and unrealized gain (loss) from:

 

 

 

Net realized gain (loss) from:

 

 

 

Investment securities

3,277,708

 

Foreign currencies

37,903

 

Forward foreign currency contracts

790,406

 

Futures contracts

(9,202,970)

Swap agreements

4,125,080

 

 

(971,873)

Change in net unrealized appreciation (depreciation) of:

 

 

 

Investment securities

18,273,146

Foreign currencies

(11,364)

 

 

 

Forward foreign currency contracts

(234,638)

 

 

 

Futures contracts

(2,552,252)

 

 

 

Swap agreements

(2,610,655)

 

12,864,237

Net realized and unrealized gain

11,892,364

Net increase in net assets resulting from operations

$31,005,396

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

16

Invesco Income Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

Operations:

 

 

 

 

 

 

Net investment income

$

19,113,032

$

15,945,650

Net realized gain (loss)

 

(971,873)

 

(15,313,056)

Change in net unrealized appreciation

 

12,864,237

 

6,932,102

Net increase in net assets resulting from operations

 

31,005,396

 

7,564,696

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

Class A

 

(19,046,833)

 

(14,181,232)

 

 

 

 

 

 

 

Class C

 

(370,901)

 

(552,544)

 

 

 

 

 

 

 

Class R

 

(250,528)

 

(168,191)

 

 

 

 

 

 

 

Class Y

 

(505,774)

 

(374,763)

 

 

 

 

 

 

 

Investor Class

 

(1,169,531)

 

(900,373)

 

 

 

 

 

 

 

Class R5

 

(42,190)

 

(31,756)

 

 

 

 

 

 

 

Class R6

 

(1,940)

 

(78,120)

 

 

 

 

 

 

 

Total distributions from distributable earnings

 

(21,387,697)

 

(16,286,979)

Share transactions–net:

 

 

 

 

 

 

Class A

 

(27,484,448)

 

(51,542,185)

 

 

 

 

 

 

 

Class C

 

(502,958)

 

(19,823,468)

Class R

 

(1,250,819)

 

224,121

 

Class Y

 

657,951

 

(776,382)

 

 

 

 

 

 

Investor Class

 

(1,416,835)

 

(3,927,700)

Class R5

 

(460,448)

 

348,195

 

Class R6

 

(6,461)

 

(6,590,194)

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from share transactions

 

(30,464,018)

 

(82,087,613)

 

 

 

 

 

 

Net increase (decrease) in net assets

 

(20,846,319)

 

(90,809,896)

Net assets:

 

 

 

 

 

 

Beginning of year

 

475,776,430

 

566,586,326

End of year

$454,930,111

$475,776,430

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

17

Invesco Income Fund

Financial Highlights

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

Net gains

 

 

 

 

 

to average

to average net

 

 

 

 

 

(losses)

 

 

 

 

 

net assets

assets without

Ratio of net

 

 

Net asset

 

on securities

 

Dividends

 

 

 

with fee waivers

fee waivers

investment

 

 

value,

Net

(both

Total from

from net

Net asset

 

Net assets,

and/or

and/or

income

 

 

beginning

investment

realized and

investment

investment

value, end

Total

end of period

expenses

expenses

to average

Portfolio

 

of period

income(a)

unrealized)

operations

income

of period

return (b) (000's omitted)

absorbed

absorbed

net assets

turnover (c)

Class A

 

 

 

 

 

 

 

 

1.00%(d)

1.00%(d)

4.08%(d)

 

Year ended 02/29/20

$8.51

$0.35

$ 0.22

$ 0.57

$(0.40)

$8.68

6.75%

$405,061

50%

Year ended 02/28/19

8.65

0.27(e)

(0.13)

0.14

(0.28)

8.51

1.66

424,003

1.01

1.08

3.12(e)

119(e)

Year ended 02/28/18

8.84

0.12

(0.15)

(0.03)

(0.16)

8.65

(0.34)

482,902

0.98

0.98

1.34

25

Year ended 02/28/17

9.02

0.11

(0.12)(f)

(0.01)

(0.17)

8.84

(0.15)(f)

559,388

0.97

0.97

1.25

30

Year ended 02/29/16

9.05

0.10

0.01

0.11

(0.14)

9.02

1.25

629,429

0.95

0.95

1.10

61

Class C

 

 

 

 

 

 

 

 

1.75(d)

1.75(d)

3.33(d)

50

Year ended 02/29/20

8.50

0.29

0.22

0.51

(0.33)

8.68

6.09

9,556

Year ended 02/28/19

8.65

0.20(e)

(0.13)

0.07

(0.22)

8.50

0.78

9,862

1.76

1.83

2.37(e)

119(e)

Year ended 02/28/18

8.83

0.05

(0.13)

(0.08)

(0.10)

8.65

(0.97)

30,223

1.73

1.73

0.59

25

Year ended 02/28/17

9.02

0.04

(0.13)(f)

(0.09)

(0.10)

8.83

(1.00)(f)

40,481

1.72

1.72

0.50

30

Year ended 02/29/16

9.04

0.03

0.02

0.05

(0.07)

9.02

0.60

49,156

1.70

1.70

0.35

61

Class R

 

 

 

 

 

 

 

 

1.25(d)

1.25(d)

3.83(d)

50

Year ended 02/29/20

8.52

0.33

0.21

0.54

(0.37)

8.69

6.48

4,443

Year ended 02/28/19

8.66

0.25(e)

(0.13)

0.12

(0.26)

8.52

1.41

5,557

1.26

1.33

2.87(e)

119(e)

Year ended 02/28/18

8.85

0.10

(0.15)

(0.05)

(0.14)

8.66

(0.58)

5,427

1.23

1.23

1.09

25

Year ended 02/28/17

9.03

0.09

(0.12)(f)

(0.03)

(0.15)

8.85

(0.39)(f)

6,219

1.22

1.22

1.00

30

Year ended 02/29/16

9.06

0.08

0.01

0.09

(0.12)

9.03

1.00

6,123

1.20

1.20

0.85

61

Class Y

 

 

 

 

 

 

 

 

0.75(d)

0.75(d)

4.33(d)

 

Year ended 02/29/20

8.52

0.38

0.21

0.59

(0.42)

8.69

7.02

10,540

50

Year ended 02/28/19

8.67

0.29(e)

(0.14)

0.15

(0.30)

8.52

1.80

9,674

0.76

0.83

3.37(e)

119(e)

Year ended 02/28/18

8.86

0.14

(0.15)

(0.01)

(0.18)

8.67

(0.08)

10,671

0.73

0.73

1.59

25

Year ended 02/28/17

9.04

0.14

(0.13)(f)

0.01

(0.19)

8.86

0.11(f)

12,554

0.72

0.72

1.50

30

Year ended 02/29/16

9.06

0.12

0.02

0.14

(0.16)

9.04

1.62

17,407

0.70

0.70

1.35

61

Investor Class

 

 

 

 

 

 

6.81(g)

24,787

0.93(d)(g)

0.93(d)(g)

4.15(d)(g)

50

Year ended 02/29/20

8.52

0.36

0.21

0.57

(0.40)

8.69

Year ended 02/28/19

8.66

0.27(e)

(0.13)

0.14

(0.28)

8.52

1.71(g)

25,692

0.95(g)

1.02(g)

3.18(e)(g)

119(e)

Year ended 02/28/18

8.85

0.12

(0.14)

(0.02)

(0.17)

8.66

(0.29)(g)

30,085

0.96(g)

0.96(g)

1.36(g)

25

Year ended 02/28/17

9.03

0.12

(0.13)(f)

(0.01)

(0.17)

8.85

(0.12)(f)(g)

35,471

0.92(g)

0.92(g)

1.30(g)

30

Year ended 02/29/16

9.06

0.10

0.01

0.11

(0.14)

9.03

1.28(g)

41,492

0.93(g)

0.93(g)

1.12(g)

61

Class R5

 

 

 

 

 

 

 

 

0.64(d)

0.64(d)

4.44(d)

 

Year ended 02/29/20

8.51

0.38

0.22

0.60

(0.43)

8.68

7.11

508

50

Year ended 02/28/19

8.66

0.30(e)

(0.14)

0.16

(0.31)

8.51

1.87

946

0.70

0.73

3.43(e)

119(e)

Year ended 02/28/18

8.85

0.15

(0.14)

0.01

(0.20)

8.66

0.04

615

0.58

0.58

1.74

25

Year ended 02/28/17

9.03

0.14

(0.12)(f)

0.02

(0.20)

8.85

0.20(f)

1,093

0.62

0.62

1.60

30

Year ended 02/29/16

9.04

0.13

0.03

0.16

(0.17)

9.03

1.84

2,068

0.59

0.59

1.46

61

Class R6

 

 

 

 

 

 

 

 

0.63(d)

0.63(d)

4.45(d)

50

Year ended 02/29/20

8.51

0.39

0.20

0.59

(0.43)

8.67

7.00

36

Year ended 02/28/19

8.66

0.30(e)

(0.14)

0.16

(0.31)

8.51

1.88

42

0.69

0.70

3.44(e)

119(e)

Year ended 02/28/18(h)

8.84

0.14

(0.14)

(0.00)

(0.18)

8.66

(0.03)

6,663

0.57(i)

0.57(i)

1.75(i)

25

(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 based on average daily net assets (000's omitted) of $416,626, $9,738, $5,813, $10,504, $25,294, $850 and $39 for Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares, respectively.

(e)Effective July 26, 2018, the Fund modified certain investment policies utilized in achieving its investment objective throughout the period. The Fund's net investment income, ratio of net investment income and portfolio turnover have increased significantly due to the realignment of the Fund's portfolio of investments as a result of these changes.

(f)Includes litigation proceeds received during the period. Had the litigation proceeds not been received, Net gains (losses) on securities (both realized and unrealized) per share would have been $(0.17), $(0.18), $(0.17), $(0.18), $(0.18) and $(0.17) for Class A, Class C, Class R, Class Y, Investor Class and Class R5 shares, respectively and total returns would have been lower.

(g)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 0.19%, 0.19%, 0.23%, 0.21% and 0.22% for the years ended February 29, 2020, February 28, 2019, February 28, 2018, February 28, 2017 and February 29, 2016, respectively.

(h)Commencement date of April 4, 2017.

(i)Annualized.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

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Invesco Income Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco Income Fund (the "Fund") is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities 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 current income, and secondarily, capital appreciation.

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.

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.

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.

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.

Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.

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 economic conditions, interest rates, investor perceptions 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 settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash

19

Invesco Income Fund

dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Paydown gains and losses on mortgage and asset-backed securities are recorded as adjustments to interest income. 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 realized and unrealized capital gains and losses to a class based on the relative net assets of each class. The Fund allocates income to a class based on the relative value of the settled shares 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, if any, are declared daily and paid monthly. Distributions from 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 Fund's organizational documents, each Trustee, officer, employee or other agent of the Fund 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.Commercial Mortgage-Backed Securities – The Fund may invest in both single and multi-issuer Commercial Mortgage-Backed Securities ("CMBS"). This includes both investment grade and non-investment grade CMBS as well as other non-rated CMBS. A CMBS is a type of mortgage-backed security that is secured by one or more mortgage loans on interests in commercial real estate property. CMBS differ from conventional debt securities because principal is paid back over the life of the security rather than at maturity. Investments in CMBS are subject to the various risks which relate to the pool of underlying assets in which the CMBS represents an interest. Securities backed by commercial real estate assets are subject to securities market risks as well as risks similar to those of direct ownership of commercial real estate loans. Risks include the ability of a borrower to meet its obligations on the loan which could lead to default or foreclosure of the property. Such actions may impact the amount of proceeds ultimately derived from the loan, and the timing of receipt of such proceeds.

Management estimates future expected cash flows at the time of purchase based on the anticipated repayment dates on the CMBS. Subsequent changes in expected cash flow projection may result in a prospective change in the timing or character of income recognized on these securities, or the amortized cost of these securities. The Fund amortizes premiums and/or accretes discounts based on the projected cash flows. Realized and unrealized gains and losses on CMBS are included in the Statement of Operations as Net realized gain (loss) from investment securities and Change in net unrealized appreciation (depreciation)of investment securities, respectively.

J.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 two parties ("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

20

Invesco Income Fund

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.

K.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.

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.

L.Put Options Purchased – The Fund may purchase put options including options on securities indexes, or foreign currency and/or futures contracts. By purchasing a put option, the Fund obtains the right (but not the obligation) to sell the option's underlying instrument at a fixed strike price. In return for this right, the Fund pays an option premium. The option's underlying instrument may be a security, securities index, or a futures contract.

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.

Put options may be used by the Fund to hedge securities it owns by locking in a minimum price at which the Fund can sell. If security prices fall, the put option could be exercised to offset all or a portion of the Fund's resulting losses. At the same time, because the maximum the Fund has at risk is the cost of the option, purchasing put options does not eliminate the potential for the Fund to profit from an increase in the value of the securities hedged. Realized and unrealized gains and losses on put 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 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.

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Invesco Income Fund

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.

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, ISDA master agreements include 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. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund's exposure is unlimited.

Notional amounts of each individual credit default swap agreement outstanding as of February 29, 2020 for which the Fund is the seller of protection are disclosed in the open swap agreements table. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by the Fund for the same referenced entity or entities.

N.Dollar Rolls and Forward Commitment Transactions - The Fund may enter into dollar roll transactions to enhance the Fund's performance. The Fund executes its dollar roll transactions in the to be announced ("TBA") market whereby the Fund makes a forward commitment to purchase a security and, instead of accepting delivery, the position is offset by the sale of the security with a simultaneous agreement to repurchase at a future date.

The Fund accounts for dollar roll transactions as purchases and sales and realizes gains and losses on these transactions. These transactions increase the Fund's portfolio turnover rate. The Fund will segregate liquid assets in an amount equal to its dollar roll commitments.

Dollar roll transactions involve the risk that a Counterparty to the transaction may fail to complete the transaction. If this occurs, the Fund may lose the opportunity to purchase or sell the security at the agreed upon price. Dollar roll transactions also involve the risk that the value of the securities retained by the Fund may decline below the price of the securities that the Fund has sold but is obligated to purchase under the agreement. Dollar roll transactions covered in this manner are not treated as senior securities for purposes of a Fund's fundamental investment limitation on senior securities and borrowings.

O.Other Risks - The Fund may invest in obligations issued by agencies and instrumentalities of the U.S. Government that may vary in the level of support they receive from the government. The government may choose not to provide financial support to government sponsored agencies or instrumentalities if it is not legally obligated to do so. In this case, if the issuer defaulted, the Fund may not be able to recover its investment in such issuer from the U.S. Government. Many securities purchased by the Fund are not guaranteed by the U.S. Government. The current low interest rate environment was created in part by the Federal Reserve Board (FRB) and certain foreign central banks keeping the federal funds and equivalent foreign rates near historical lows. Increases in the federal funds and equivalent foreign rates may expose fixed income markets to heightened volatility and reduced liquidity for certain fixed income investments, particularly those with longer maturities. In addition, decreases in fixed income dealer market-making capacity may also potentially lead to heightened volatility and reduced liquidity in the fixed income markets. As a result, the value of the Fund's investments and share price may decline. Changes in central bank policies could also result in higher than normal shareholder redemptions, which could potentially increase portfolio turnover and the Fund's transaction costs. CLOs are subject to the risks of substantial losses due to actual defaults by underlying borrowers, which will be greater during periods of economic or financial stress. CLOs may also lose value due to collateral defaults and disappearance of subordinate tranches, market anticipation of defaults, and investor aversion to CLO securities as a class. The risks of CLOs will be greater if the Fund invests in CLOs that hold loans of uncreditworthy borrowers or if the Fund holds subordinate tranches of the CLO that absorbs losses from the defaults before senior tranches. In addition, CLOs are subject to interest rate risk and credit risk. The market values of convertible securities are affected by market interest rates, the risk of actual issuer default on interest or principal payments and the value of the underlying common stock into which the convertible security may be converted. Additionally, a convertible security is subject to the same types of market and issuer risks as apply to the underlying common stock. In addition, certain convertible securities are subject to involuntary conversions and may undergo principal write-downs upon the occurrence of certain triggering events, and, as a result, are subject to an increased risk of loss. Convertible securities may be rated below investment grade. 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. The Fund may invest in lower-quality debt securities, i.e., "junk bonds". Investments in lower-rated securities or unrated securities of comparable quality tend to be more sensitive to economic conditions than higher rated securities. Junk bonds involve a greater risk of default by the issuer because such securities are generally unsecured and are often subordinated to other creditors' claim. Mortgage- and asset-backed securities, including collateralized debt obligations and collateralized mortgage obligations, are subject to prepayment or call risk, which is the risk that a borrower's payments may be received earlier or later than expected due to changes in prepayment rates on underlying loans. This could result in the Fund reinvesting these early payments at lower interest rates, thereby reducing the Fund's income. Mortgage- and asset-backed securities also are subject to extension risk, which is the risk that an unexpected rise in interest rates could reduce the rate of prepayments, causing the price of the mortgage- and asset-backed securities and the Fund's share price to fall. An unexpectedly high rate of defaults on the mortgages held by a mortgage pool may adversely affect the value of mortgage-backed securities and could result in losses to the Fund. Privately-issued mortgage-backed securities and asset-backed securities may be less liquid than other types of securities and the Fund may be unable to sell these securities at the time or price it desires. The risk of a municipal obligation generally depends on the financial and credit status of the issuer. Constitutional amendments, legislative enactments, executive orders, administrative regulations, voter initiatives, and the issuer's regional economic conditions may affect the municipal security's value, interest payments, repayment of principal and the Fund's ability to sell the security. Failure of a municipal security issuer to comply with applicable tax requirements may make income paid thereon taxable, resulting in a decline in the security's value. In addition, there could be changes in applicable tax laws or tax treatments that reduce

22

Invesco Income Fund

or eliminate the current federal income tax exemption on municipal securities or otherwise adversely affect the current federal or state tax status of municipal securities. Preferred securities are subject to issuer-specific and market risks applicable generally to equity securities. Preferred securities also may be subordinated to bonds or other debt instruments, subjecting them to a greater risk of non-payment, may be less liquid than many other securities, such as common stocks, and generally offer no voting rights with respect to the issuer. Obligations of U.S. Government agencies and authorities receive varying levels of support and may not be backed by the full faith and credit of the U.S. Government, which could affect the Fund's ability to recover should they default. No assurance can be given that the U.S. Government will provide financial support to its agencies and authorities if it is not obligated by law to do so.

P.Collateral —To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund's practice to replace such collateral no later than the next business day.

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 $200 million

0.500%

Next $300 million

0.400%

Next $500 million

0.350%

 

 

Next $19.5 billion

0.300%

 

 

Over $20.5 billion

0.240%

For the year ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.44%.

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).

Effective July 1, 2019, the Adviser has contractually agreed, through at least June 30, 2020, 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 1.07%, 1.82%, 1.32%, 0.82%, 1.07%, 0.82% and 0.82%, respectively, of average daily net assets (the "expense limits"). Prior to July 1, 2019, the Adviser had contractually 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, Investor Class, Class R5 and Class R6 shares to 1.01%, 1.76%, 1.26%, 0.76%, 1.01%, 0.76% and 0.76%, 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; (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, 2020. 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 has contractually agreed, through at least June 30, 2021, 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 year ended February 29, 2020, the Adviser waived advisory fees of $3,791.

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 year ended February 29, 2020, 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 year ended February 29, 2020, 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, 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 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. 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 year ended February 29, 2020, 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 year ended February 29, 2020, IDI advised the Fund that IDI retained $22,230 in front-end sales commissions from the sale of Class A shares and $2,015 and $580 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

23

Invesco Income 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 February 29, 2020. 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

 

 

 

 

 

 

 

Asset-Backed Securities

$

$313,062,715

$—

$313,062,715

 

U.S. Government Sponsored Agency Mortgage-Backed Securities

 

55,260,119

55,260,119

 

Agency Credit Risk Transfer Notes

 

47,228,674

47,228,674

 

U.S. Dollar Denominated Bonds & Notes

 

35,154,721

35,154,721

 

Preferred Stocks

 

31,016,415

31,016,415

 

U.S. Treasury Securities

 

8,200,606

8,200,606

 

Common Stocks & Other Equity Interests

 

7,875,500

7,875,500

 

Exchange-Traded Fund

 

4,551,930

4,551,930

 

Money Market Funds

 

4,191,860

4,191,860

 

Total Investments in Securities

 

47,635,705

458,906,835

506,542,540

 

Other Investments - Assets*

 

 

 

 

 

 

 

Swap Agreements

 

82,718

82,718

 

Other Investments - Liabilities*

 

 

 

 

 

 

 

Futures Contracts

 

(2,166,593)

(2,166,593)

 

 

 

 

 

 

 

Forward Foreign Currency Contracts

 

(247,941)

(247,941)

 

 

 

 

 

 

 

Swap Agreements

 

(2,046,468)

(2,046,468)

 

 

 

 

 

 

 

 

 

(2,166,593)

(2,294,409)

(4,461,002)

 

 

 

 

 

 

 

Total Other Investments

 

(2,166,593)

(2,211,691)

(4,378,284)

Total Investments

$45,469,112

$456,695,144

$—

$502,164,256

 

*Unrealized appreciation (depreciation).

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 February 29, 2020:

 

 

 

 

 

Value

 

 

 

 

 

Credit

 

Currency

 

Interest

 

 

Derivative Assets

 

Risk

 

Risk

 

Rate Risk

 

Total

Unrealized appreciation on swap agreements — OTC

$

82,718

$

-

$

-

$

82,718

Derivatives not subject to master netting agreements

 

-

 

-

 

-

 

-

 

 

 

 

 

 

 

 

 

Total Derivative Assets subject to master netting agreements

$

82,718

$

-

$

-

$

82,718

24

Invesco Income Fund

 

 

 

 

 

Value

 

 

 

 

 

Credit

 

Currency

 

Interest

 

 

Derivative Liabilities

 

Risk

 

Risk

 

Rate Risk

Total

 

Unrealized depreciation on futures contracts — Exchange-Traded(a)

$

-

$

-

$(2,166,593)

$(2,166,593)

 

 

 

 

 

 

 

 

 

Unrealized depreciation on swap agreements — OTC

 

(1,787,925)

 

-

 

-

(1,787,925)

 

 

 

 

 

 

 

 

 

Unrealized depreciation on swap agreements — Centrally Cleared(a)

 

(258,543)

 

-

 

-

(258,543)

 

 

 

 

 

 

 

 

 

Unrealized depreciation on forward foreign currency contracts outstanding

 

-

 

(247,941)

 

-

(247,941)

 

 

 

 

 

 

 

 

 

Total Derivative Liabilities

 

(2,046,468)

 

(247,941)

 

(2,166,593)

(4,461,002)

Derivatives not subject to master netting agreements

 

258,543

 

-

 

2,166,593

2,425,136

 

 

 

 

 

 

 

 

Total Derivative Liabilities subject to master netting agreements

$(1,787,925)

$(247,941)

$

-

$(2,035,866)

 

 

 

 

 

 

 

 

 

(a)The daily variation margin receivable (payable) at period-end is recorded in the Statement of Assets and Liabilities.

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 February 29, 2020.

 

Financial Derivative Assets

 

Financial Derivative Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

Forward

 

 

 

 

 

 

 

Collateral

 

 

 

 

 

 

 

 

 

Foreign

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Received/Pledged)

 

 

 

 

 

 

Swap

 

Currency

 

Swap

 

Total

Net Value of

 

 

Net

Counterparty

Agreements

 

 

Contracts

Agreements

 

Liabilities

Derivatives

Non-Cash

Cash

 

 

Amount

 

Goldman Sachs International

$

-

 

$(247,941)

$

-

$

(247,941)

$

(247,941)

$-

$

-

$

(247,941)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JP Morgan Chase Bank, N.A.

 

-

 

-

 

(1,030,816)

 

(1,030,816)

 

(1,030,816)

-

 

-

 

(1,030,816)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Merrill Lynch International

 

-

 

-

 

(915,352)

 

(915,352)

 

(915,352)

-

640,000

 

(275,352)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Morgan Stanley and Co. International PLC

 

82,718

 

-

 

-

 

-

 

 

82,718

-

 

-

 

82,718

 

Total

$82,718

 

$(247,941)

$

(1,946,168)

$(2,194,109)

$(2,111,391)

$-

$640,000

$(1,471,391)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effect of Derivative Investments for the year ended February 29, 2020

The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:

 

 

 

 

Location of Gain (Loss) on

 

 

 

 

 

 

 

 

Statement of Operations

 

 

 

 

 

 

 

Credit

Currency

Interest

 

 

 

 

 

 

 

Risk

Risk

Rate Risk

 

Total

Realized Gain (Loss):

 

 

 

 

 

 

 

 

 

Forward foreign currency contracts

$

-

$ 790,406

$

-

$ 790,406

 

Futures contracts

 

 

-

-

(9,202,970)

(9,202,970)

Swap agreements

 

 

4,125,080

-

 

-

4,125,080

 

 

 

 

 

 

 

 

 

 

 

Change in Net Unrealized Appreciation (Depreciation):

 

 

 

 

 

 

 

 

 

Forward foreign currency contracts

 

 

-

(234,638)

 

-

(234,638)

 

 

 

 

 

 

 

 

Futures contracts

 

 

-

-

(2,552,252)

(2,552,252)

 

 

 

 

 

 

 

 

 

Swap agreements

 

 

(2,610,655)

-

 

-

(2,610,655)

 

 

 

 

 

 

 

Total

$

1,514,425

$ 555,768

$(11,755,222)

$(9,685,029)

 

 

 

 

 

 

 

The table below summarizes the average notional value of derivatives held during the period.

 

 

 

 

 

 

 

 

 

 

Forward

 

 

 

 

 

 

 

 

 

Foreign Currency

Futures

 

Swap

 

 

 

 

Contracts

Contracts

 

Agreements

 

Average notional value

 

 

 

$12,645,047

$133,037,696

 

$87,745,833

 

 

 

 

 

 

 

 

 

 

 

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $11,164.

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

25

Invesco Income 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 may borrow for leveraging in an amount up to 5% of the Fund's total assets (excluding the amount borrowed) at the time the borrowing is made. In doing so, 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—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 29, 2020 and February 28, 2019:

 

 

2020

2019

 

 

Ordinary income

$21,387,698

$16,286,979

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

2020

 

 

Undistributed ordinary income

 

$ 1,745,767

 

 

 

 

Net unrealized appreciation — investments

 

16,786,781

Net unrealized appreciation - foreign currencies

 

1,589

 

Temporary book/tax differences

 

(204,090)

 

 

 

 

Capital loss carryforward

 

(44,015,640)

Shares of beneficial interest

 

480,615,704

Total net assets

 

$454,930,111

 

 

 

 

 

 

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to forward contracts and futures contracts.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund has a capital loss carryforward as of February 29, 2020, as follows:

Capital Loss Carryforward*

Expiration

Short-Term

Long-Term

Total

Not subject to expiration

$12,123,526

$31,892,114

$44,015,640

*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 9—Investment Transactions

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the year ended February 29, 2020 was $432,045,187 and $405,838,402, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $33,506,094 and $58,964,600, 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

$23,090,390

 

Aggregate unrealized (depreciation) of investments

(6,303,609)

Net unrealized appreciation of investments

$16,786,781

 

Cost of investments for tax purposes is $485,377,475.

NOTE 10—Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of foreign currency transactions and swap income, on February 29, 2020, undistributed net investment income was increased by $2,831,973 and undistributed net realized gain (loss) was decreased by $2,831,973. This reclassification had no effect on the net assets or the distributable earnings (loss) of the Fund.

26

Invesco Income Fund

NOTE 11—Share Information

 

 

Summary of Share Activity

 

 

 

 

Year ended

Year ended

 

February 29, 2020(a)

 

February 28, 2019

 

 

Shares

Amount

Shares

Amount

Sold:

 

 

 

 

 

 

 

Class A

2,130,404

$ 18,534,383

4,031,812

$ 34,311,976

Class C

316,687

2,753,344

250,021

2,141,661

 

Class R

221,072

1,921,311

109,486

937,672

 

Class Y

771,953

6,695,585

726,889

6,258,779

 

Investor Class

130,188

1,135,316

114,345

981,519

 

Class R5

32,274

278,633

76,145

656,750

 

Class R6

-

-

 

111,277

961,635

 

Issued as reinvestment of dividends:

 

 

 

 

 

 

 

Class A

1,877,185

16,272,173

1,449,135

12,337,543

Class C

38,334

332,348

55,756

473,731

 

Class R

28,178

244,556

19,572

166,650

 

Class Y

46,088

400,368

32,850

280,106

 

Investor Class

130,934

1,136,640

101,907

867,515

 

Class R5

4,727

40,958

3,633

30,933

 

Class R6

166

1,434

8,028

69,421

 

Automatic conversion of Class C shares to Class A shares:

 

 

 

 

 

 

 

Class A

119,864

1,038,536

-

-

 

 

Class C

(119,827)

(1,038,536)

-

-

 

 

Reacquired:

 

 

 

 

 

 

 

Class A

(7,301,314)

(63,329,540)

(11,460,472)

(98,191,704)

 

 

 

 

 

 

Class C

(293,945)

(2,550,114)

(2,641,892)

(22,438,860)

 

 

 

 

 

 

Class R

(390,467)

(3,416,686)

(103,213)

(880,201)

 

 

 

 

 

 

Class Y

(740,947)

(6,438,002)

(855,886)

(7,315,267)

 

 

 

 

 

 

Investor Class

(424,722)

(3,688,791)

(674,338)

(5,776,734)

 

 

 

 

 

 

Class R5

(89,666)

(780,039)

(39,713)

(339,488)

 

 

 

 

 

 

Class R6

(909)

(7,895)

(883,831)

(7,621,250)

 

 

 

 

 

 

Net increase (decrease) in share activity

(3,513,743)

$(30,464,018)

(9,568,489)

$(82,087,613)

 

 

 

 

 

 

 

 

(a)There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 21% 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.

NOTE 12—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

27

Invesco Income Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Income Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Income Fund, formerly Invesco

U.S. Government Fund, (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the periods indicated therein (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the periods indicated therein in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, Texas

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

28

Invesco Income 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 September 1, 2019 through February 29, 2020.

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

 

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

 

Period2

Ratio

Class A

$1,000.00

$1,016.10

 

$4.91

$1,019.99

 

$4.92

0.98%

 

 

 

 

 

 

 

 

 

Class C

1,000.00

1,012.30

 

8.66

1,016.26

 

8.67

1.73

 

 

 

 

 

 

 

 

 

Class R

1,000.00

1,016.00

 

6.17

1,018.75

 

6.17

1.23

 

 

 

 

 

 

 

 

 

Class Y

1,000.00

1,017.40

 

3.66

1,021.23

 

3.67

0.73

Investor Class

1,000.00

1,017.50

 

4.51

1,020.39

 

4.52

0.90

 

 

 

 

 

 

 

 

 

Class R5

1,000.00

1,019.10

 

3.11

1,021.78

 

3.12

0.62

 

 

 

 

 

 

 

 

 

Class R6

1,000.00

1,018.00

 

3.06

1,021.83

 

3.07

0.61

 

 

 

 

 

 

 

 

 

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

29

Invesco Income Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Qualified Dividend Income*

0.51%

Corporate Dividends Received Deduction*

0.00%

Qualified Business Income*

9.26%

U.S. Treasury Obligations*

1.15%

Tax-Exempt Interest Dividends*

0.00%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

30

Invesco Income Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

 

 

 

 

 

T-1

Invesco Income Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-2

Invesco Income Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-3

Invesco Income Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-4

Invesco Income Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-5

Invesco Income Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

State Street Bank and Trust Company

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

225 Franklin Street

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Boston, MA 02110-2801

T-6

Invesco Income Fund

7

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(This page intentionally left blank)

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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

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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 holdings four times in each fiscal year, at the quarter-ends. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 033-39519

Invesco Distributors, Inc.

INC-AR-1

Annual Report to Shareholders

February 29, 2020

Invesco Real Estate Fund

Nasdaq:

A: IARAX ￿ C: IARCX ￿ R: IARRX ￿ Y: IARYX ￿ Investor: REINX ￿ R5: IARIX ￿ R6: IARFX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's web- site, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call (800) 959-4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

4 Performance Summary

6 Long-Term Fund Performance

8 Supplemental Information

9 Schedule of Investments

11 Financial Statements

14 Financial Highlights

15 Notes to Financial Statements

21Report of Independent Registered Public Accounting Firm

22Fund Expenses

23Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco Real Estate Fund

Bruce Crockett

Dear Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco Real Estate Fund

Management's Discussion of Fund Performance

Performance summary

For the fiscal year ended February 29, 2020, Class A shares of Invesco Real Estate Fund (the Fund), at net asset value (NAV), outperformed the Fund's style-specific benchmark, the FTSE Nareit All Equity REITs Index.

Your Fund's long-term performance appears later in this report.

Fund vs. Indexes

Total returns, 2/28/19 to 2/29/20, 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

8.11%

Class C Shares

7.25

Class R Shares

7.78

Class Y Shares

8.33

Investor Class Shares

8.06

Class R5 Shares

8.47

Class R6 Shares

8.60

S&P 500 Index￿ (Broad Market Index)

8.19

FTSE Nareit All Equity REITs Index￿ (Style-Specific Index)

7.98

Lipper Real Estate Funds Index￿ (Peer Group)

6.77

Source(s): ￿RIMES Technologies Corp.; ￿ Lipper Inc.

now speculate that key central banks will in- troduce further stimulus to support economic confidence and boost markets. Listed real estate companies are mid-way through re- porting year-end financial results. There have been few surprises so far. Retail has been weak, with declines in asset values and some emerging re-purposing strategies to meet the challenges of excess mall capacity. Elsewhere, across most property types, results have been positive, showing asset value and earn- ings growth. Management teams continue to show cautious optimism, with a willingness to continue to acquire and develop assets. Per- formance dispersion among REIT sectors was wide over the fiscal year. Lodging and retail focused REITs showed the greatest weakness. Top-performing sectors included the high growth data center and infrastructure sec- tors, as well as manufactured housing and single-family housing.

During the fiscal year, the Fund's over- weight exposure to infrastructure, manufac- tured housing and single family homes con- tributed to performance relative to its style-

Market conditions and your Fund

At the close of the fiscal year, equity markets reacted strongly to the prospect of dimin- ished global growth as a result of the impact of the Coronavirus (COVID-19). At the close of the fiscal year, global GDP growth esti- mates for 2020 were cut, as economic growth around the world is expected to be materially impacted by the virus outbreak. US Treasury yields fell amid risk aversion and in anticipation of future interest rate cuts from key central banks, including the US Federal Reserve. Completion of phase one of a trade deal between China and the US had previ- ously offered some positive news to capital markets following much uncertainty during 2019. Negotiations on future trade terms will likely continue. The fiscal year ended with US consumer confidence rising for four consecu-

Portfolio Composition

By property type

% of total net assets

Infrastructure REITs

18.56%

Health Care

 

9.95

Office

 

9.69

Industrial

 

8.14

Single Family Homes

 

7.57

Diversified

 

7.54

Apartments

 

7.27

Data Centers

 

7.02

Manufactured Homes

 

4.10

Regional Malls

 

3.75

Specialty

 

3.21

Lodging Resorts

 

2.90

Self Storage

 

2.62

Free Standing

 

2.53

Timber REITs

 

2.39

Shopping Centers

 

1.85

Money Market Funds Plus Other

 

Assets Less Liabilities

 

0.91

tive months and was accompanied by in- creases in housing starts and non-farm pay- rolls. However, areas of caution remain in the US, as industrial production and retail sales reported slight declines. The magnitude and duration of the impact of the coronavirus is still far from clear, with weakness expected to be evident in second quarter 2020 economic data and corporate earnings.

US Real Estate Investment Trusts (REITs) offered positive absolute performance over the fiscal year driven by a combination of supportive fundamental and macro-related factors. US REITs generally outperformed other risk assets through the late period mar- ket sell-off, reflecting underlying income secu- rity, as markets tended to reward predictable growth and well-covered dividends during a period of falling bond yields and slowing global growth. We believe the market may

Top 10 Equity Holdings*

% of total net assets

1.

American Tower Corp.

8.67%

2.

Crown Castle International

 

 

Corp.

6.33

3.

Boston Properties, Inc.

5.34

4.

AvalonBay Communities, Inc.

4.40

5.

Equinix, Inc.

3.82

6.

SBA Communications Corp.,

 

 

Class A

3.56

7.

VEREIT, Inc.

3.30

8.

Ventas, Inc.

3.26

9.

UDR, Inc.

3.26

10.

Healthpeak Properties, Inc.

2.94

specific index, as did an underweight allocation to regional malls and security selec- tion in apartments. Conversely, relative de- tractors included security selection in health care and regional malls and an allocation to cash. Although the portfolio held a small amount of ancillary cash, it detracted as mar- kets gained through much of the fiscal year.

Top individual absolute contributors to the Fund's performance during the fiscal year included infrastructure REITs, American Tower and Crown Castle International. American Tower is expected to see an accel- eration in cash flow growth in 2020 as under- lying demand characteristics remain quite strong. Crown Castle has been building out small cell nodes for 5G deployment and is ex- periencing tailwinds from current 4G demand,

The Fund's holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.

*Excluding money market fund holdings, if any.

Data presented here are as of February 29, 2020.

4Invesco Real Estate Fund

with future demand potential from 5Gexpan- sion. Carrier spending remains robust domes- tically and international trends are expected to improve. The portfolio is overweight the infrastructure sector, which is primarily com- prised of cell tower REITs.

Top individual absolute detractors from Fund performance during the fiscal year in- cluded two positions in the challenged retail sector, Simon Property Group and Macerich. Simon Property Group is the largest mall owner in the US. The company has a strong management team and a track record of pre- dictable cash flow growth, strong asset alloca- tion and attractive reinvestment returns. Macerich is a regional mall operator that owns high quality properties in the US. The company offered a discounted valuation and the prospect of stabilized operating results.

Relative to its style-specific benchmark, at the end of the fiscal year, the Fund was over- weight the residential, infrastructure, office and specialty REIT sectors. Conversely, the Fund was underweight the retail, self-storage and industrial REIT sectors. Positioning is fo- cused on sectors and market exposures that support rental growth, as well as companies that can generate growth from attractive capital deployment opportunities.

At the end of the fiscal year, real estate continued to offer investors tangible asset exposure, with rents that can adjust upwards (or downwards) over time with economic strength and inflation. Listed real estate com- panies were generally maintaining financial discipline. Falling credit costs were improving cash flows modestly, and absolute levels of debt remained in check. Many companies had the ability to utilize attractively priced new equity and debt to complete accretive acquisi- tions and enhance their growth rate. While recognizing the need to maintain attractive yield characteristics in an income starved world, our overall portfolio maintains a bias toward companies with higher quality assets, supply constrained real estate market expo- sure, generally lower leveraged balance sheets and most importantly, above average earnings and asset value growth.

We thank you for your continued invest- ment in Invesco Real Estate Fund.

Portfolio managers:

Mark Blackburn

James Cowen

Paul Curbo - Lead

Grant Jackson - Lead

Joe Rodriguez, Jr. - Lead

Darin Turner

Ping-Ying Wang

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any

market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

5Invesco Real Estate Fund

Your Fund's Long-Term Performance

Results of a $10,000 Investment — Oldest Share Class(es)

Fund and index data from 2/28/10

$40,000

35,000

 

 

 

$32,918

S&P 500 Index1

30,000

$30,860

FTSE Nareit All Equity REITs Index1

 

$27,691 Lipper Real Estate Funds Index2

25,000

$24,963

Invesco Real Estate Fund — Class C Shares

20,000

 

 

15,000

10,000

5,000

2/28/10

2/11

2/12

2/13

2/14

2/15

2/16

2/17

2/18

2/19

2/20

1Source: RIMES Technologies Corp.

2 Source: Lipper Inc.

Past performance cannot guarantee future results.

The data shown in the chart include rein- vested distributions, applicable sales charges and Fund expenses including management

fees. Index results include reinvested divi- dends, but they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses and management fees;

performance of a market index does not. Per- formance shown in the chart does not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares.

6Invesco Real Estate Fund

Average Annual Total Returns

As of 2/29/20, including maximum applicable sales charges

Class A Shares

Inception (12/31/96)

8.94%

10 Years

9.79

5

Years

4.22

1

Year

2.16

Class C Shares

 

Inception (5/1/95)

10.06%

10 Years

9.58

5

Years

4.60

1

Year

6.26

Class R Shares

 

Inception (4/30/04)

9.00%

10 Years

10.13

5

Years

5.13

1

Year

7.78

Class Y Shares

 

Inception (10/3/08)

8.67%

10 Years

10.69

5

Years

5.66

1

Year

8.33

Investor Class Shares

 

Inception (9/30/03)

9.43%

10 Years

10.41

5

Years

5.41

1

Year

8.06

Class R5 Shares

 

Inception (4/30/04)

9.72%

10 Years

10.84

5

Years

5.79

1

Year

8.47

Class R6 Shares

 

10 Years

10.79%

5

Years

5.89

1

Year

8.60

Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.

The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month- end performance. Performance figures re- flect reinvested distributions, changes in net asset value and the effect of the maxi- mum sales charge unless otherwise stated. Performance figures do not reflect deduc- tion of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.

Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC)

for the period involved. The CDSC on

Class C shares is 1% for the first year after purchase. Class R, Class Y, Investor Class, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; there- fore, performance is at net asset value.

The performance of the Fund's share classes will differ primarily due to different sales charge structures and class expenses. Fund performance reflects any applicable

fee waivers and/or expense reimburse- ments. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more informa- tion.

7Invesco Real Estate Fund

Invesco Real Estate Fund's investment objective is total return through growth of capital and current income.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

About indexes used in this report

￿The S&P 500® Index is an unmanaged index considered representative of the US stock market.

￿The FTSE Nareit All Equity REITs Index is an unmanaged index considered repre- sentative of US REITs.

￿The Lipper Real Estate Funds Index is an unmanaged index considered representa- tive of real estate funds tracked by Lipper.

￿The Fund is not managed to track the per- formance of any particular index, including the index(es) described here, and conse- quently, 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. Perfor- mance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.

Other information

￿Property type classifications used in this report are generally according to the FTSE National Association of Real Estate Invest- ment Trusts Nareit) Equity All REITs Index, which is exclusively owned by Nareit.

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

8Invesco Real Estate Fund

Schedule of Investments(a)

February 29, 2020

SharesValue

Common Stocks & Other Equity Interests–99.09%

Apartments–7.27%

 

 

 

AvalonBay Communities,

 

 

 

Inc.

313,477

$

62,880,351

Equity Residential

253,897

 

19,067,665

Essex Property Trust, Inc.

4,444

 

1,259,252

Mid-America Apartment

 

 

 

Communities, Inc.

160,348

 

20,726,582

 

 

 

103,933,850

Data Centers–7.02%

 

 

 

CyrusOne, Inc.

280,652

 

17,001,898

Digital Realty Trust, Inc.

118,007

 

14,173,821

Equinix, Inc.

95,352

 

54,617,626

QTS Realty Trust, Inc.,

 

 

 

Class A

257,662

 

14,472,874

 

 

 

100,266,219

Diversified–7.54%

 

 

 

American Assets Trust,

 

 

 

Inc.

210,858

 

8,740,064

BGP Holdings PLC(b)(c)(d)

3,547,941

 

0

VEREIT, Inc.

5,436,340

 

47,078,705

VICI Properties, Inc.

1,432,385

 

35,895,568

Vornado Realty Trust

299,242

 

16,033,386

 

 

 

107,747,723

Free Standing–2.53%

 

 

 

Agree Realty Corp.

295,623

 

21,231,644

Essential Properties

 

 

 

Realty Trust, Inc.

358,428

 

8,211,585

Four Corners Property

 

 

 

Trust, Inc.

189,584

 

5,439,165

Realty Income Corp.

18,190

 

1,316,774

 

 

 

36,199,168

Health Care–9.95%

 

 

 

CareTrust REIT, Inc.

560,669

 

11,701,162

Healthpeak Properties,

 

 

 

Inc.

1,329,059

 

42,051,427

Medical Properties Trust,

 

 

 

Inc.

692,842

 

14,639,751

Omega Healthcare

 

 

 

Investors, Inc.

471,912

 

18,687,715

Ventas, Inc.

866,596

 

46,596,867

Welltower, Inc.

113,095

 

8,461,768

 

 

 

142,138,690

Industrial–8.14%

 

 

 

Americold Realty Trust

577,676

 

17,717,323

EastGroup Properties,

 

 

 

Inc.

90,419

 

11,368,381

Exeter Industrial Value

 

 

 

Fund L.P., (Acquired

 

 

 

11/06/2007-04/18/2011;

 

 

 

Cost $3,554,748)(b)(c)(d)(e)

4,185,000

 

263,538

Prologis, Inc.

455,519

 

38,391,141

Rexford Industrial Realty,

 

 

 

Inc.

417,631

 

19,532,602

STAG Industrial, Inc.

590,037

 

16,509,235

 

Shares

Value

Industrial–(continued)

 

 

Terreno Realty Corp.

228,543

$ 12,540,155

 

 

116,322,375

Infrastructure REITs–18.56%

 

 

American Tower Corp.

546,100

123,855,480

Crown Castle International Corp.

631,442

90,479,324

SBA Communications Corp., Class A

192,162

50,940,225

 

 

265,275,029

Lodging Resorts–2.90%

 

 

Park Hotels & Resorts, Inc.

576,000

10,517,760

Pebblebrook Hotel Trust

822,488

16,622,483

Sunstone Hotel Investors, Inc.

1,303,292

14,271,047

 

 

41,411,290

Manufactured Homes–4.10%

 

 

Camden Property Trust

252,448

26,754,439

Sun Communities, Inc.

208,227

31,833,744

 

 

58,588,183

Office–9.69%

 

 

Alexandria Real Estate Equities, Inc.

128,153

19,463,877

Boston Properties, Inc.

591,770

76,302,824

Empire State Realty Trust, Inc.,

 

 

Class A

131,617

1,539,919

Hudson Pacific Properties, Inc.

1,162,421

37,522,950

Kilroy Realty Corp.

49,281

3,582,236

 

 

138,411,806

Regional Malls–3.75%

 

 

Macerich Co. (The)

628,469

12,833,337

Simon Property Group, Inc.

331,624

40,816,282

 

 

53,649,619

Self Storage–2.62%

 

 

Extra Space Storage, Inc.

70,314

7,056,713

Public Storage

145,026

30,327,837

 

 

37,384,550

Shopping Centers–1.85%

 

 

Federal Realty Investment Trust

137,048

15,944,165

Regency Centers Corp.

33,262

1,910,569

Retail Opportunity Investments

 

 

Corp.

568,412

8,526,180

 

 

26,380,914

Single Family Homes–7.57%

 

 

American Homes 4 Rent, Class A

873,745

22,621,258

Invitation Homes, Inc.

1,359,076

38,991,890

UDR, Inc.

1,035,173

46,562,082

 

 

108,175,230

Specialty–3.21%

 

 

EPR Properties

279,576

16,562,082

Gaming and Leisure Properties, Inc.

366,351

16,364,899

Lamar Advertising Co., Class A

154,350

12,925,269

 

 

45,852,250

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco Real Estate Fund

 

Shares

 

Value

Timber REITs–2.39%

 

 

 

PotlatchDeltic Corp.

87,368

$

3,209,900

Rayonier, Inc.

263,248

 

6,983,970

Weyerhaeuser Co.

923,813

 

24,000,662

 

 

 

34,194,532

Total Common Stocks & Other Equity Interests

 

 

(Cost $1,144,075,425)

 

 

1,415,931,428

Money Market Funds–1.31%

Invesco Government & Agency

 

 

Portfolio, Institutional Class,

 

 

1.50%(f)

6,694,798

6,694,798

Investment Abbreviations:

REIT – Real Estate Investment Trust

Notes to Schedule of Investments:

 

 

Shares

 

Value

 

Money Market Funds–(continued)

 

 

 

Invesco Liquid Assets Portfolio,

 

 

 

 

 

Institutional Class, 1.64%(f)

4,400,118

$

4,402,318

 

Invesco Treasury Portfolio,

 

 

 

 

 

Institutional Class, 1.48%(f)

7,651,197

 

7,651,197

 

 

Total Money Market Funds (Cost $18,747,702)

 

18,748,313

 

TOTAL INVESTMENTS IN SECURITIES–100.40%

 

 

 

 

(Cost $1,162,823,127)

 

 

1,434,679,741

 

OTHER ASSETS LESS LIABILITIES–(0.40)%

 

 

(5,702,129)

NET ASSETS–100.00%

 

$1,428,977,612

 

(a)Property type classifications used in this report are generally according to FSTE National Association of Real Estate Investment Trusts ("NAREIT") Equity REITs Index, which is exclusively owned by NAREIT.

(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 February 29, 2020 was $263,538, which represented less than 1% of the Fund's Net Assets.

(c)Non-income producing security.

(d)Security valued using significant unobservable inputs (Level 3). See Note 3.

(e)The Fund has a remaining commitment to purchase additional interests, which are subject to the terms of the limited partnership agreements for the following securities:

 

Remaining

Percent

Security

Commitment

Ownership

Exeter Industrial Value Fund L.P.

$315,000

1.26%

 

 

 

(f)The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of February 29, 2020.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco Real Estate Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

Investments in securities, at value

 

(Cost $1,144,075,425)

$1,415,931,428

Investments in affiliated money market funds, at value

 

(Cost $18,747,702)

18,748,313

Foreign currencies, at value (Cost $223)

201

Receivable for:

 

Investments sold

72,269,881

Fund shares sold

1,581,993

Dividends

1,021,964

Investment for trustee deferred compensation and

 

retirement plans

322,922

Other assets

31,821

Total assets

1,509,908,523

Liabilities:

 

Payable for:

 

Investments purchased

71,385,629

Fund shares reacquired

8,287,135

Accrued fees to affiliates

794,462

Accrued trustees' and officers' fees and benefits

4,311

Accrued other operating expenses

103,207

Trustee deferred compensation and retirement plans

356,167

Total liabilities

80,930,911

Net assets applicable to shares outstanding

$1,428,977,612

Net assets consist of:

 

Shares of beneficial interest

$1,090,658,711

Distributable earnings

338,318,901

 

$1,428,977,612

Net Assets:

 

 

Class A

$

627,197,019

Class C

$

27,928,410

Class R

$

60,629,638

Class Y

$

204,950,774

Investor Class

$

37,537,265

Class R5

$

268,267,469

Class R6

$

202,467,037

Shares outstanding, no par value, with an unlimited number of shares authorized:

Class A

 

30,273,091

Class C

 

1,358,264

Class R

 

2,922,636

Class Y

 

9,894,287

Investor Class

 

1,817,376

Class R5

 

12,953,450

Class R6

 

9,778,026

Class A:

 

 

Net asset value per share

$

20.72

Maximum offering price per share

 

 

(Net asset value of $20.72 ÷ 94.50%)

$

21.93

Class C:

 

 

Net asset value and offering price per share

$

20.56

Class R:

 

 

Net asset value and offering price per share

$

20.74

Class Y:

 

 

Net asset value and offering price per share

$

20.71

Investor Class:

 

 

Net asset value and offering price per share

$

20.65

Class R5:

 

 

Net asset value and offering price per share

$

20.71

Class R6:

 

 

Net asset value and offering price per share

$

20.71

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco Real Estate Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

 

 

Dividends

$

38,610,302

 

Dividends from affiliated money market funds

 

410,735

 

 

Total investment income

 

39,021,037

 

Expenses:

 

 

 

 

Advisory fees

 

11,140,042

 

Administrative services fees

 

217,045

 

 

Custodian fees

 

16,938

 

 

Distribution fees:

 

 

 

 

Class A

 

1,703,656

 

Class C

 

348,845

 

 

Class R

 

354,323

 

 

Investor Class

 

95,385

 

 

Transfer agent fees — A, C, R, Y and Investor

 

2,225,017

 

Transfer agent fees — R5

 

283,321

 

 

Transfer agent fees — R6

 

33,449

 

 

Trustees' and officers' fees and benefits

 

38,132

 

 

Registration and filing fees

 

124,676

 

 

Reports to shareholders

 

103,846

 

 

Professional services fees

 

51,978

 

 

Other

 

29,687

 

 

Total expenses

 

16,766,340

 

Less: Fees waived and/or expense offset arrangement(s)

 

(32,699)

Net expenses

 

16,733,641

 

Net investment income

 

22,287,396

 

Realized and unrealized gain (loss) from:

 

 

 

 

Net realized gain from investment securities

 

154,774,685

 

Change in net unrealized appreciation (depreciation) of:

 

 

 

 

Investment securities

 

(58,588,746)

 

 

 

 

Foreign currencies

 

(12)

 

 

 

 

 

 

(58,588,758)

Net realized and unrealized gain

 

96,185,927

 

Net increase in net assets resulting from operations

$118,473,323

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco Real Estate Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

Operations:

 

 

 

 

 

 

Net investment income

$

22,287,396

$

23,353,356

 

Net realized gain

 

154,774,685

 

75,802,591

 

Change in net unrealized appreciation (depreciation)

 

(58,588,758)

 

112,154,898

 

Net increase in net assets resulting from operations

 

118,473,323

 

211,310,845

 

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

Class A

 

(56,826,231)

 

(42,212,217)

 

 

 

 

 

 

Class C

 

(2,461,328)

 

(3,925,756)

 

 

 

 

 

 

Class R

 

(5,707,071)

 

(4,474,585)

 

 

 

 

 

 

Class Y

 

(18,979,045)

 

(12,761,563)

 

 

 

 

 

 

Investor Class

 

(3,406,311)

 

(2,096,895)

 

 

 

 

 

 

Class R5

 

(25,153,977)

 

(18,064,948)

 

 

 

 

 

 

Class R6

 

(17,676,934)

 

(10,546,805)

 

 

 

 

 

 

Total distributions from distributable earnings

 

(130,210,897)

 

(94,082,769)

Share transactions–net:

 

 

 

 

 

 

Class A

 

(30,974,296)

 

(54,230,870)

 

 

 

 

 

 

Class C

 

(11,223,202)

 

(43,568,230)

 

 

 

 

 

 

Class R

 

(8,276,671)

 

(11,593,453)

 

 

 

 

 

 

Class Y

 

18,547,348

 

(17,239,710)

 

 

 

 

 

 

Investor Class

 

5,637,507

 

(3,084,456)

 

 

 

 

 

 

Class R5

 

12,121,611

 

(21,635,603)

Class R6

 

46,331,139

 

48,498,088

 

Net increase (decrease) in net assets resulting from share transactions

 

32,163,436

 

(102,854,234)

Net increase in net assets

 

20,425,862

 

14,373,842

 

Net assets:

 

 

 

 

 

 

Beginning of year

 

1,408,551,750

 

1,394,177,908

 

End of year

$

1,428,977,612

$1,408,551,750

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco Real Estate Fund

Financial Highlights

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

Net gains

 

 

 

 

 

 

 

to average

to average net

 

 

 

 

 

(losses)

 

 

 

 

 

 

 

net assets

assets without

Ratio of net

 

 

Net asset

 

on securities

 

Dividends

Distributions

 

 

 

 

with fee waivers

fee waivers

investment

 

 

value,

Net

(both

Total from

from net

from net

 

Net asset

 

Net assets,

and/or

and/or

income

 

 

beginning

investment

realized and

investment

investment

realized

Total

value, end

Total

end ofperiod

expenses

expenses

to average

Portfolio

 

ofperiod

income(a)

unrealized)

operations

income

gains

distributions

ofperiod

return (b)

(000's omitted)

absorbed

absorbed

net assets

turnover (c)

Class A

 

 

 

 

 

 

 

 

 

 

1.23%(d)

1.23%(d)

1.33%(d)

 

Year ended 02/29/20

$20.94

$0.30

$ 1.44

$ 1.74

$(0.35)

$(1.61)

$(1.96)

$20.72

8.11%

$ 627,197

59%

Year ended 02/28/19

19.32

0.32

2.70

3.02

(0.28)

(1.12)

(1.40)

20.94

15.98

661,325

1.27

1.27

1.54

47

Year ended 02/28/18

21.64

0.30

(1.35)

(1.05)

(0.25)

(1.02)

(1.27)

19.32

(5.38)

659,464

1.27

1.27

1.38

44

Year ended 02/28/17

21.76

0.31

2.97

3.28

(0.41)

(2.99)

(3.40)

21.64

15.74

922,255

1.24

1.24

1.31

52

Year ended 02/29/16

27.02

0.39

(1.75)

(1.36)

(0.29)

(3.61)

(3.90)

21.76

(5.26)

1,043,135

1.25

1.25

1.57

80

Class C

 

 

 

 

 

 

 

 

 

 

1.98(d)

1.98(d)

0.58(d)

59

Year ended 02/29/20

20.80

0.13

1.42

1.55

(0.18)

(1.61)

(1.79)

20.56

7.25

27,928

Year ended 02/28/19

19.20

0.16

2.68

2.84

(0.12)

(1.12)

(1.24)

20.80

15.10

38,515

2.02

2.02

0.79

47

Year ended 02/28/18

21.50

0.14

(1.34)

(1.20)

(0.08)

(1.02)

(1.10)

19.20

(6.04)

76,811

2.02

2.02

0.63

44

Year ended 02/28/17

21.64

0.13

2.95

3.08

(0.23)

(2.99)

(3.22)

21.50

14.84

117,090

1.99

1.99

0.56

52

Year ended 02/29/16

26.89

0.21

(1.76)

(1.55)

(0.09)

(3.61)

(3.70)

21.64

(5.98)

126,592

2.00

2.00

0.82

80

Class R

 

 

 

 

 

 

 

 

 

 

1.48(d)

1.48(d)

1.08(d)

59

Year ended 02/29/20

20.97

0.24

1.43

1.67

(0.29)

(1.61)

(1.90)

20.74

7.78

60,630

Year ended 02/28/19

19.35

0.27

2.70

2.97

(0.23)

(1.12)

(1.35)

20.97

15.67

68,733

1.52

1.52

1.29

47

Year ended 02/28/18

21.66

0.24

(1.34)

(1.10)

(0.19)

(1.02)

(1.21)

19.35

(5.56)

74,367

1.52

1.52

1.13

44

Year ended 02/28/17

21.78

0.25

2.97

3.22

(0.35)

(2.99)

(3.34)

21.66

15.43

102,102

1.49

1.49

1.06

52

Year ended 02/29/16

27.04

0.33

(1.76)

(1.43)

(0.22)

(3.61)

(3.83)

21.78

(5.50)

103,196

1.50

1.50

1.32

80

Class Y

 

 

 

 

 

 

 

 

 

 

0.98(d)

0.98(d)

1.58(d)

 

Year ended 02/29/20

20.94

0.36

1.42

1.78

(0.40)

(1.61)

(2.01)

20.71

8.33

204,951

59

Year ended 02/28/19

19.32

0.37

2.70

3.07

(0.33)

(1.12)

(1.45)

20.94

16.28

188,940

1.02

1.02

1.79

47

Year ended 02/28/18

21.63

0.35

(1.34)

(0.99)

(0.30)

(1.02)

(1.32)

19.32

(5.09)

191,203

1.02

1.02

1.63

44

Year ended 02/28/17

21.76

0.37

2.96

3.33

(0.47)

(2.99)

(3.46)

21.63

15.98

201,330

0.99

0.99

1.56

52

Year ended 02/29/16

27.02

0.46

(1.75)

(1.29)

(0.36)

(3.61)

(3.97)

21.76

(5.02)

171,879

1.00

1.00

1.82

80

Investor Class

 

 

 

 

 

 

 

 

8.06(e)

37,537

1.22(d)(e)

1.22(d)(e)

1.34(d)(e)

59

Year ended 02/29/20

20.89

0.30

1.42

1.72

(0.35)

(1.61)

(1.96)

20.65

Year ended 02/28/19

19.27

0.32

2.70

3.02

(0.28)

(1.12)

(1.40)

20.89

16.05(e)

32,447

1.23(e)

1.23(e)

1.58(e)

47

Year ended 02/28/18

21.58

0.30

(1.34)

(1.04)

(0.25)

(1.02)

(1.27)

19.27

(5.33)(e)

32,868

1.23(e)

1.23(e)

1.42(e)

44

Year ended 02/28/17

21.71

0.31

2.96

3.27

(0.41)

(2.99)

(3.40)

21.58

15.73(e)

41,961

1.23(e)

1.23(e)

1.32(e)

52

Year ended 02/29/16

26.97

0.39

(1.75)

(1.36)

(0.29)

(3.61)

(3.90)

21.71

(5.27)

43,435

1.25

1.25

1.57

80

Class R5

 

 

 

 

 

 

 

 

 

 

0.87(d)

0.87(d)

1.69(d)

 

Year ended 02/29/20

20.94

0.38

1.43

1.81

(0.43)

(1.61)

(2.04)

20.71

8.47

268,267

59

Year ended 02/28/19

19.32

0.40

2.69

3.09

(0.35)

(1.12)

(1.47)

20.94

16.41

258,447

0.88

0.88

1.93

47

Year ended 02/28/18

21.63

0.38

(1.34)

(0.96)

(0.33)

(1.02)

(1.35)

19.32

(4.96)

258,599

0.89

0.89

1.76

44

Year ended 02/28/17

21.76

0.39

2.96

3.35

(0.49)

(2.99)

(3.48)

21.63

16.12

345,558

0.89

0.89

1.66

52

Year ended 02/29/16

27.02

0.49

(1.75)

(1.26)

(0.39)

(3.61)

(4.00)

21.76

(4.89)

380,119

0.87

0.87

1.95

80

Class R6

 

 

 

 

 

 

 

 

 

 

0.79(d)

0.79(d)

1.77(d)

59

Year ended 02/29/20

20.93

0.40

1.44

1.84

(0.45)

(1.61)

(2.06)

20.71

8.60

202,467

Year ended 02/28/19

19.31

0.41

2.70

3.11

(0.37)

(1.12)

(1.49)

20.93

16.52

160,145

0.80

0.80

2.01

47

Year ended 02/28/18

21.63

0.40

(1.35)

(0.95)

(0.35)

(1.02)

(1.37)

19.31

(4.93)

100,866

0.80

0.80

1.85

44

Year ended 02/28/17

21.75

0.41

2.97

3.38

(0.51)

(2.99)

(3.50)

21.63

16.28

111,069

0.80

0.80

1.75

52

Year ended 02/29/16

27.02

0.51

(1.76)

(1.25)

(0.41)

(3.61)

(4.02)

21.75

(4.85)

99,691

0.78

0.78

2.04

80

(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 based on average daily net assets (000's omitted) of $681,462, $34,885, $70,865, $215,776, $39,409, $285,797 and $194,729 for Class A, Class C, Class R, Class Y, Investor Class, Class R5 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 0.24%, 0.21%, 0.21% and 0.24% for the years ended February 29, 2020, February 28, 2019, February 28, 2018 and February 28, 2017, respectively.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

14

Invesco Real Estate Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco Real Estate Fund (the "Fund"), is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"). The Trust is organized as a Delaware statutory trust and is 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 total return through growth of capital and current income.

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.

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 economic conditions, interest rates, investor perceptions 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 settlement date. 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

15

Invesco Real Estate Fund

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.

The Fund recharacterizes distributions received from REIT investments based on information provided by the REIT into the following categories: ordinary income, long-term and short-term capital gains, and return of capital. If information is not available on a timely basis from the REIT, the recharacterization will be based on available information which may include the previous year's allocation. If new or additional information becomes available from the REIT at a later date, a recharacterization will be made in the following year. The Fund records as dividend income the amount recharacterized as ordinary income and as realized gain the amount recharacterized as capital gain in the Statement of Operations, and the amount recharacterized as return of capital as a reduction of the cost of the related investment. These recharacterizations are reflected in the accompanying financial statements.

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, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from 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 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.

16

Invesco Real Estate Fund

K.Other Risks - The Fund's investments are concentrated in a comparatively narrow segment of the economy. Consequently, the Fund may tend to be more volatile than other mutual funds, and the value of the Fund's investments may tend to rise and fall more rapidly.

Because the Fund concentrates its assets in the real estate industry, an investment in the Fund will be closely linked to the performance of the real estate markets. Property values may fall due to increasing vacancies or declining rents resulting from economic, legal, cultural or technological developments. 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

0.750%

 

 

Next $250 million

0.740%

Next $500 million

0.730%

Next $1.5 billion

0.720%

 

 

Next $2.5 billion

0.710%

Next $2.5 billion

0.700%

Next $2.5 billion

0.690%

 

 

Over $10 billion

0.680%

For the year ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.73%.

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, 2020, 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 2.00%, 2.75%, 2.25%, 1.75%, 2.00%, 1.75% and 1.75%, 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; (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, 2020. 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.

The Adviser has contractually agreed, through at least June 30, 2021, 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 year ended February 29, 2020, the Adviser waived advisory fees of $23,314.

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 year ended February 29, 2020, 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 year ended February 29, 2020, 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, 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 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. 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 year ended February 29, 2020, 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 year ended February 29, 2020, IDI advised the Fund that IDI retained $61,167 in front-end sales commissions from the sale of Class A shares and $1,622 and $1,180 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.

17

Invesco Real Estate 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 February 29, 2020. 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

$1,415,667,890

$—

$263,538

$1,415,931,428

Money Market Funds

18,748,313

18,748,313

Total Investments

$1,434,416,203

$—

$263,538

$1,434,679,741

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $9,385.

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—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 29, 2020 and February 28, 2019:

 

 

 

2020

 

2019

 

 

Ordinary income

$

39,459,554

 

$22,075,021

 

 

 

 

 

 

 

 

Long-term capital gain

 

90,751,343

 

72,007,747

 

 

 

 

 

 

 

Total distributions

$130,210,897

 

$94,082,768

 

 

 

 

 

 

 

 

 

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

Undistributed ordinary income

 

 

$

2,438,058

 

 

 

 

 

 

 

Undistributed long-term capital gain

 

 

 

71,092,831

 

Net unrealized appreciation — investments

 

 

 

265,091,549

 

Net unrealized appreciation (depreciation) - foreign currencies

 

 

 

(22)

 

 

 

 

 

 

Temporary book/tax differences

 

 

 

(303,515)

 

 

 

 

 

 

Shares of beneficial interest

 

 

 

1,090,658,711

 

Total net assets

 

 

$1,428,977,612

 

 

 

 

 

 

 

 

 

18

Invesco Real Estate Fund

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to wash sales and partnerships.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund does not have a capital loss carryforward as of February 29, 2020.

NOTE 8—Investment Transactions

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the year ended February 29, 2020 was $872,542,392 and $936,595,846, 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

$334,889,262

 

Aggregate unrealized (depreciation) of investments

(69,797,713)

Net unrealized appreciation of investments

$265,091,549

 

Cost of investments for tax purposes is $1,169,588,192.

NOTE 9—Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of real estate investment trust distributions, on February 29, 2020, undistributed net investment income was increased by $209,578 and undistributed net realized gain was decreased by $209,578. This reclassification had no effect on the net assets or the distributable earnings of the Fund.

NOTE 10—Share Information

 

 

Summary of Share Activity

 

 

Year ended

Year ended

 

February 29, 2020(a)

 

February 28, 2019

 

Shares

Amount

Shares

Amount

Sold:

 

 

 

 

 

Class A

4,184,405

$ 94,583,732

5,516,816

$ 112,951,191

Class C

321,511

7,167,575

364,831

7,407,773

Class R

586,165

13,268,701

481,532

9,920,030

Class Y

3,147,958

70,191,718

2,649,740

54,659,398

Investor Class

422,712

9,346,776

124,211

2,551,399

Class R5

3,397,673

76,641,504

2,228,100

45,641,704

Class R6

4,564,112

103,313,563

3,583,299

72,626,666

Issued as reinvestment of dividends:

 

 

 

 

 

Class A

2,537,733

54,142,757

1,956,863

39,351,502

Class C

106,556

2,251,419

182,565

3,641,313

Class R

267,268

5,707,041

222,352

4,474,460

Class Y

603,160

12,860,778

482,628

9,699,268

Investor Class

153,236

3,258,842

100,591

2,017,643

Class R5

1,174,200

25,070,905

895,302

18,004,816

Class R6

813,623

17,365,275

512,770

10,309,979

Automatic conversion of Class C shares to Class A shares:

 

 

 

 

 

Class A

390,499

8,967,960

-

-

Class C

(392,920)

(8,967,960)

-

-

19

Invesco Real Estate Fund

 

 

 

Summary of Share Activity

 

 

 

Year ended

 

Year ended

 

February 29, 2020(a)

 

 

February 28, 2019

 

 

Shares

 

Amount

 

Shares

Amount

Reacquired:

 

 

 

 

 

 

 

 

Class A

(8,417,407)

$(188,668,745)

(10,022,050)

$(206,533,563)

 

 

 

 

 

 

 

Class C

(528,815)

 

(11,674,236)

(2,695,706)

(54,617,316)

 

 

 

 

 

 

 

Class R

(1,208,801)

 

(27,252,413)

(1,269,952)

(25,987,943)

 

 

 

 

 

 

 

Class Y

(2,880,174)

 

(64,505,148)

(4,004,981)

(81,598,376)

 

 

 

 

 

 

 

Investor Class

(311,921)

 

(6,968,111)

(376,735)

(7,653,498)

 

 

 

 

 

 

 

Class R5

(3,962,056)

 

(89,590,798)

(4,166,477)

(85,282,123)

 

 

 

 

 

 

 

Class R6

(3,249,980)

 

(74,347,699)

(1,668,339)

(34,438,557)

 

 

 

 

 

 

 

Net increase (decrease) in share activity

1,718,737

$

32,163,436

(4,902,640)

$(102,854,234)

 

 

 

 

 

 

 

 

 

(a)There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 18% 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.

NOTE 11—Significant Event

The Board of Trustees of the Fund unanimously approved an Agreement and Plan of Reorganization (the "Agreement") pursuant to which the Fund would acquire all of the assets and liabilities of Invesco Oppenheimer Real Estate Fund (the "Target Fund") in exchange for shares of the Fund.

The reorganization was consummated on April 17, 2020. Upon closing of the reorganization, shareholders of the Target Fund received shares of the Fund in exchange for their shares of the Target Fund, and the Target Fund liquidated and ceased operations.

NOTE 12—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

20

Invesco Real Estate Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Real Estate Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Real Estate Fund (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the five years in the period ended February 29, 2020 (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the five years in the period ended February 29, 2020 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, Texas

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

21

Invesco Real Estate 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 September 1, 2019 through February 29, 2020.

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

 

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

 

Period2

Ratio

Class A

$1,000.00

$956.40

 

$5.89

$1,018.85

 

$6.07

1.21%

 

 

 

 

 

 

 

 

 

Class C

1,000.00

952.70

 

9.52

1,015.12

 

9.82

1.96

 

 

 

 

 

 

 

 

 

Class R

1,000.00

954.70

 

7.10

1,017.60

 

7.32

1.46

 

 

 

 

 

 

 

 

 

Class Y

1,000.00

957.20

 

4.67

1,020.09

 

4.82

0.96

Investor Class

1,000.00

955.90

 

5.93

1,018.80

 

6.12

1.22

 

 

 

 

 

 

 

 

 

Class R5

1,000.00

958.10

 

4.24

1,020.54

 

4.37

0.87

 

 

 

 

 

 

 

 

 

Class R6

1,000.00

958.50

 

3.85

1,020.93

 

3.97

0.79

 

 

 

 

 

 

 

 

 

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

22

Invesco Real Estate Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Federal and State Income Tax

Long-Term Capital Gain Distributions

$90,751,343

Qualified Dividend Income*

2.70%

Qualified Business Income*

69.80%

Corporate Dividends Received Deduction*

0.16%

U.S. Treasury Obligations*

0.00%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

23

Invesco Real Estate Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

 

 

 

 

 

T-1

Invesco Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-2

Invesco Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-3

Invesco Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-4

Invesco Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-5

Invesco Real Estate Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

State Street Bank and Trust Company

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

225 Franklin Street

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Boston, MA 02110-2801

T-6

Invesco Real Estate Fund

(This page intentionally left blank)

(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 holdings four times in each fiscal year, at the quarter-ends. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 033-39519

Invesco Distributors, Inc.

REA-AR-1

Annual Report to Shareholders

February 29, 2020

Invesco Short Duration Inflation Protected Fund

Nasdaq:

A: LMTAX ￿ A2: SHTIX ￿ Y: LMTYX ￿ R5: ALMIX ￿ R6: SDPSX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's web- site, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call (800) 959-4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

4 Performance Summary

6 Long-Term Fund Performance

8 Supplemental Information

9 Schedule of Investments

10 Financial Statements

13 Financial Highlights

14 Notes to Financial Statements

18Report of Independent Registered Public Accounting Firm

19Fund Expenses

20Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco Short Duration Inflation Protected Fund

Bruce Crockett

Dear Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco Short Duration Inflation Protected Fund

Management's Discussion of Fund Performance

Performance summary

For the fiscal year ended February 29, 2020, Class A shares of Invesco Short Du- ration Inflation Protected Fund (the Fund), at net asset value (NAV), underper- formed the Fund's broad market/style-specific benchmark, the ICE BofAML

1-5 Year US Inflation-Linked Treasury Index.

Your Fund's long-term performance appears later in this report.

Fund vs. Indexes

Total returns, February 28, 2019 to February 29, 2020, 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

4.61%

Class A2 Shares

4.81

Class Y Shares

4.86

Class R5 Shares

4.91

Class R6 Shares

4.92

ICE BofAML 1-5 Year US Inflation-Linked Treasury Index￿ (Broad Market/Style-

 

Specifc Index)

5.27

Lipper Inflation Protected Bond Funds Index￿ (Peer Group Index)

8.23

Source(s): ￿RIMES Technologies Corp.; ￿Lipper Inc.

basis point is one one-hundredth of a percent- age point.)

During the fiscal year, annual inflation, as measured by the Consumer Price Index (CPI), declined to a low of 1.6% in June 2019.4 However, the CPI subsequently increased steadily and ended the fiscal year at 2.3%.4 This increase was partly attributed to higher shelter and food costs.

Shorter-term US Treasury inflation pro- tected securities (TIPS) posted positive re- turns for the fiscal year as the ICE BofAML 1–5 Year US Inflation-Linked Treasury Index returned 5.27%. Considerably lower yields across maturities were the primary drivers of positive returns. The average yield on the broad market/style-specific index decreased 95 basis points and ended the fiscal year at -0.34% as TIPS prices increased in 2019 against a backdrop of lower interest rates.5 Shorter-term TIPS underperformed their nominal US Treasury counterparts on a maturity-matched basis as yields on nominal US Treasuries fell more than real yields for

Market conditions and your Fund

The fiscal year began with heightened volatil- ity as investors feared that the US Federal Reserve (the Fed) had gone too far in its monetary policy tightening and that the ef- fects would lead to a synchronized global eco- nomic growth slowdown. That uncertainty was quickly alleviated when the Fed changed its course and all but promised no rate hikes in 2019. The renewed risk appetite was fur- ther inspired by dovish central banks globally.

This trend continued throughout the fiscal year until February 2020, when investors began to fear that the spread of the Corona-

Portfolio Composition

By U.S. Treasury Securities

as of February 29, 2020

 

Coupon

% of Total

Maturity Date

Rate

Net Assets

4/15/2021

0.12%

7.81%

7/15/2021

0.62

6.63

1/15/2022

0.13

7.55

4/15/2022

0.13

7.52

7/15/2022

0.13

7.44

1/15/2023

0.13

7.39

4/15/2023

0.62

8.01

7/15/2023

0.37

7.44

1/15/2024

0.62

7.50

4/15/2024

0.50

5.43

7/15/2024

0.13

7.23

10/15/2024

0.13

5.79

1/15/2025

2.37

6.92

1/15/2025

0.25

7.33

Other Assets Less

 

 

Liabilities

 

0.01

The Fund's holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.

Data presented here are as of February 29, 2020.

virus (COVID-19) would lead to a global eco- nomic slowdown.

The Fed cut interest rates three times dur- ing the fiscal year to a range of 1.50% to 1.75%.1 The European Central Bank also cut rates at the end of 2019 to -0.50%.2 This, coupled with easier fiscal and monetary policy in China and the continued economic woes plaguing the European Union, led to easier financial conditions globally, which, in turn, drove interest rates lower across maturities. The 10-year US Treasury yield ended the fis- cal year at 1.13%, 160 basis points lower than at the beginning of the fiscal year.3 (A

TIPS during the fiscal year. The difference between yields on a maturity-matched basis and nominal yields on US Treasuries and TIPS is a measure of inflation expectations, also known as breakeven inflation (the amount of inflation needed for TIPS to break even with nominal Treasuries).

We seek to replicate the risk and return characteristics of the Fund's broad market/ style-specific index, the ICE BofAML 1–5 Year US Inflation-Linked Treasury Index, by gener- ally investing in the component securities of the index in their respective weightings. For the fiscal year, the Fund generated positive returns and underperformed its broad

4Invesco Short Duration Inflation Protected Fund

market/style-specific benchmark. The Fund's performance will typically lag its index due to fees, as was the case this fiscal year.

We wish to remind you that the Fund is subject to real interest rate risk, meaning the values of inflation-indexed securities generally fluctuate in response to changes in real inter- est rates. However, the Fund invests in shorter-duration inflation-indexed securities, which tend to have less real interest rate risk. Inflation-indexed securities typically provide principal and interest payments that are ad- justed over time to reflect a rise (inflation) or a drop (deflation) in the general price level for goods and services. However, at maturity, the value of TIPS cannot fall below their par value. Real interest rates are tied to the rela- tionship between nominal interest rates and the rate of inflation. If nominal interest rates increase at a faster rate than inflation, real interest rates might rise, leading to a de- crease in value of inflation-indexed securities. Conversely, if inflation rises at a faster rate than nominal interest rates, real interest rates might decline, leading to an increase in value of inflation-indexed securities. The Fund's income from its investments in inflation- indexed securities is likely to fluctuate consid- erably more than the income distributions of its investments in more traditional fixed- income securities.

We are monitoring real interest rates and the market, as well as economic and geopoliti- cal factors that may impact the direction, speed and magnitude of changes to real inter- est rates across the maturity spectrum, in- cluding the potential impact of monetary policy changes by the Fed and certain foreign central banks. If real interest rates rise or fall faster than expected, inflation-indexed secu- rity markets may experience increased volatil- ity, which may affect the value and/or liquidity of the Fund's investments.

Thank you for investing in Invesco Short Duration Inflation Protected Fund and for sharing our long-term investment horizon.

1 Source: US Federal Reserve

2 Source: European Central Bank

3Source: US Department of the Treasury

4 Source: US Bureau of Labor Statistics

5 Source: Bloomberg

Portfolio Manager:

Robert Young

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results,

these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

5Invesco Short Duration Inflation Protected Fund

Your Fund's Long-Term Performance

Results of a $10,000 Investment — Oldest Share Class(es)

Fund and index data from 2/28/10

$15,000

12,000

9,000

2/28/10

2/11

2/12

2/13

2/14

2/15

2/16

2/17

2/18

2/19

2/20

$13,548 Lipper Inflation Protected Bond Funds Index1

$11,901 ICE BofAML 1-5 Year US Inflation-Linked Treasury Index2

$11,068 Invesco Short Duration Inflation Protected Fund — Class R5 Shares*

$10,844 Invesco Short Duration Inflation Protected Fund — Class A2 Shares*

1 Source: Lipper Inc.

2 Source: RIMES Technologies Corp.

*The Fund's oldest share class (Class R5) does not have a sales charge. Therefore, the second-oldest share class, which has a sales charge (Class A2), is also included in the chart.

Past performance cannot guarantee future results.

The data shown in the chart include rein- vested distributions, applicable sales charges and Fund expenses including management

fees. Index results include reinvested divi- dends, but they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses and management fees; performance of a market index does not. Per-

formance shown in the chart and table(s) does not reflect deduction of taxes a share- holder would pay on Fund distributions or sale of Fund shares.

6Invesco Short Duration Inflation Protected Fund

Average Annual Total Returns

As of 2/29/20, including maximum applicable sales charges

Class A Shares

Inception (10/31/02)

1.37%

10 Years

0.59

5

Years

1.03

1

Year

2.00

Class A2 Shares

 

Inception (12/15/87)

3.72%

10 Years

0.81

5

Years

1.46

1

Year

3.79

Class Y Shares

 

Inception (10/3/08)

1.11%

10 Years

1.00

5

Years

1.79

1

Year

4.86

Class R5 Shares

 

Inception (7/13/87)

3.97%

10 Years

1.02

5

Years

1.80

1

Year

4.91

Class R6 Shares

 

10 Years

0.98%

5

Years

1.81

1

Year

4.92

Class R6 shares incepted on December 31, 2015. Performance shown prior to that date is that of Class A2 shares and in- cludes the 12b-1 fees applicable to Class A2 shares.

The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month- end performance. Performance figures re- flect reinvested distributions, changes in net asset value and the effect of the maxi- mum sales charge unless otherwise stated. Performance figures do not reflect deduc- tion of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.

Class A share performance reflects the maximum 2.50% sales charge. Class A2 share performance reflects the maximum 1.00% sales charge. Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, perfor- mance is at net asset value.

The performance of the Fund's share classes will differ primarily due to different sales charge structures and class expenses. Fund performance reflects any applicable

fee waivers and/or expense reimburse- ments. Had the adviser not waived fees and/or reimbursed expenses currently or in

the past, returns would have been lower. See current prospectus for more informa- tion.

7Invesco Short Duration Inflation Protected Fund

Invesco Short Duration Inflation Protected Fund's investment objective is to provide protection from the negative effects of unanticipated inflation.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

About indexes used in this report

￿The ICE BofAML 1-5 Year US Inflation- Linked Treasury Index is composed of US Treasury inflation-protected securities with maturities between one and five years.

￿The Lipper Inflation Protected Bond Funds Index is an unmanaged index con- sidered representative of inflation pro- tected bond funds tracked by Lipper.

￿A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Perfor- mance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.

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

8Invesco Short Duration Inflation Protected Fund

Schedule of Investments

February 29, 2020

 

Principal

 

 

 

 

Interest

Maturity

Amount

 

Rate

Date

(000)

Value

U.S. Treasury Securities–99.99%

U.S. Treasury Inflation — Indexed Notes–99.99%(a)

U.S. Treasury Inflation - Indexed Notes

0.12%

04/15/2021

$42,853

$

42,897,262

U.S. Treasury Inflation - Indexed Notes

0.62%

07/15/2021

35,938

 

36,444,873

U.S. Treasury Inflation - Indexed Notes

0.13%

01/15/2022

41,214

 

41,492,772

U.S. Treasury Inflation - Indexed Notes

0.13%

04/15/2022

41,015

 

41,288,660

U.S. Treasury Inflation - Indexed Notes

0.13%

07/15/2022

40,293

 

40,843,146

U.S. Treasury Inflation - Indexed Notes

0.13%

01/15/2023

40,138

 

40,615,178

U.S. Treasury Inflation - Indexed Notes

0.62%

04/15/2023

42,790

 

43,972,681

U.S. Treasury Inflation - Indexed Notes

0.37%

07/15/2023

39,815

 

40,889,169

U.S. Treasury Inflation - Indexed Notes

0.62%

01/15/2024

39,693

 

41,180,760

U.S. Treasury Inflation - Indexed Notes

0.50%

04/15/2024

28,861

 

29,831,532

U.S. Treasury Inflation - Indexed Notes

0.13%

07/15/2024

38,759

 

39,722,857

U.S. Treasury Inflation - Indexed Notes

0.13%

10/15/2024

30,998

 

31,808,846

U.S. Treasury Inflation - Indexed Notes

2.37%

01/15/2025

33,538

 

38,035,465

U.S. Treasury Inflation - Indexed Notes

0.25%

01/15/2025

39,059

 

40,239,714

TOTAL INVESTMENTS IN SECURITIES–99.99% (Cost $539,481,582)

 

 

 

 

549,262,915

OTHER ASSETS LESS LIABILITIES–0.01%

 

 

 

 

67,477

NET ASSETS–100.00%

 

 

 

$549,330,392

Notes to Schedule of Investments:

(a)Principal amount of security and interest payments are adjusted for inflation. See Note 1H.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco Short Duration Inflation Protected Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

 

Investments in securities, at value

 

 

(Cost $539,481,582)

$549,262,915

 

Receivable for:

 

 

Fund shares sold

366,766

 

Dividends

85

 

Interest

426,326

 

Investment for trustee deferred compensation and

 

 

retirement plans

103,573

 

Other assets

29,219

 

Total assets

550,188,884

 

Liabilities:

 

 

Payable for:

 

 

Fund shares reacquired

152,338

 

Amount due custodian

405,093

 

Accrued fees to affiliates

35,445

 

Accrued trustees' and officers' fees and benefits

3,008

 

Accrued other operating expenses

149,707

 

Trustee deferred compensation and retirement plans

112,901

 

Total liabilities

858,492

 

Net assets applicable to shares outstanding

$549,330,392

 

Net assets consist of:

 

 

Shares of beneficial interest

$563,248,107

 

Distributable earnings (loss)

(13,917,715)

 

$549,330,392

 

Net Assets:

 

 

Class A

$

45,382,739

Class A2

$

16,640,929

Class Y

$

17,905,914

Class R5

$

2,340,178

Class R6

$

467,060,632

Shares outstanding, no par value, with an unlimited number of shares authorized:

Class A

 

4,349,313

Class A2

 

1,593,137

Class Y

 

1,713,654

Class R5

 

224,113

Class R6

 

44,711,256

Class A:

 

 

Net asset value per share

$

10.43

Maximum offering price per share

 

 

(Net asset value of $10.43 ÷ 97.50%)

$

10.70

Class A2:

 

 

Net asset value per share

$

10.45

Maximum offering price per share

 

 

(Net asset value of $10.45 ÷ 99.00%)

$

10.56

Class Y:

 

 

Net asset value and offering price per share

$

10.45

Class R5:

 

 

Net asset value and offering price per share

$

10.44

Class R6:

 

 

Net asset value and offering price per share

$

10.45

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco Short Duration Inflation Protected Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

 

Treasury Inflation-Protected Securities inflation adjustments

$12,753,438

 

Interest

2,597,903

 

Dividends from affiliated money market funds

4,505

 

 

Total investment income

15,355,846

 

Expenses:

 

 

 

Advisory fees

1,111,190

 

Administrative services fees

80,204

 

 

Custodian fees

15,903

 

 

Distribution fees:

 

 

 

Class A

112,153

 

 

Class A2

25,342

 

 

Transfer agent fees — A, A2, and Y

114,124

 

 

Transfer agent fees — R5

701

 

 

Transfer agent fees — R6

5,609

 

 

Trustees' and officers' fees and benefits

26,350

 

 

Registration and filing fees

83,937

 

 

Licensing fees

112,707

 

 

Reports to shareholders

9,375

 

 

Professional services fees

14,016

 

 

Other

14,255

 

 

Total expenses

1,725,866

 

 

Less: Fees waived, expenses reimbursed and/or expense offset arrangement(s)

(84,728)

Net expenses

1,641,138

 

 

Net investment income

13,714,708

 

Realized and unrealized gain (loss) from:

 

 

 

Net realized gain (loss) from investment securities

(4,699,221)

Change in net unrealized appreciation of investment securities

18,466,453

 

Net realized and unrealized gain

13,767,232

 

Net increase in net assets resulting from operations

$27,481,940

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco Short Duration Inflation Protected Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

Operations:

 

 

 

 

 

 

Net investment income

$

13,714,708

$

16,501,187

Net realized gain (loss)

 

(4,699,221)

 

(11,033,375)

Change in net unrealized appreciation

 

18,466,453

 

5,604,084

Net increase in net assets resulting from operations

 

27,481,940

 

11,071,896

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

Class A

 

(716,900)

 

(1,168,210)

 

 

 

 

 

 

 

Class A2

 

(284,986)

 

(482,204)

 

 

 

 

 

 

 

Class Y

 

(217,029)

 

(330,480)

 

 

 

 

 

 

 

Class R5

 

(50,696)

 

(23,473)

 

 

 

 

 

 

 

Class R6

 

(9,505,471)

 

(18,389,116)

 

 

 

 

 

 

 

Total distributions from distributable earnings

 

(10,775,082)

 

(20,393,483)

Return of capital:

 

 

 

 

 

 

Class A

 

(127,457)

 

 

Class A2

 

(50,667)

 

 

Class Y

 

(38,586)

 

 

Class R5

 

(9,013)

 

 

Class R6

 

(1,689,975)

 

 

Total return of capital

 

(1,915,698)

 

 

Total distributions

 

(12,690,780)

 

Share transactions–net:

 

 

 

 

 

 

Class A

 

(2,181,523)

 

1,393,651

Class A2

 

(1,059,533)

 

(2,333,195)

 

 

 

 

 

 

Class Y

 

7,695,748

 

(2,770,274)

Class R5

 

(709,349)

 

2,240,559

Class R6

 

(170,261,367)

 

(76,491,971)

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from share transactions

 

(166,516,024)

 

(77,961,230)

 

 

 

 

 

 

Net increase (decrease) in net assets

 

(151,724,864)

 

(87,282,817)

Net assets:

 

 

 

 

 

 

Beginning of year

 

701,055,256

 

788,338,073

End of year

$

549,330,392

$701,055,256

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco Short Duration Inflation Protected Fund

Financial Highlights

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

 

Net gains

 

 

 

 

 

 

 

to average

to average net

Ratio of net

 

 

 

 

 

(losses)

 

 

 

 

 

 

 

net assets

assets without

investment

 

 

 

Net asset

Net

on securities

 

Dividends

 

 

 

 

 

with fee waivers

fee waivers

income

 

 

 

value,

investment

(both

Total from

from net

 

 

Net asset

 

Net assets,

and/or

and/or

(loss)

 

 

 

beginning

income

realized and

investment

investment

Return of

Total

value, end

Total

end ofperiod

expenses

expenses

to average

 

Portfolio

 

ofperiod

(loss)(a)

unrealized)

operations

income

capital

distributions

ofperiod

return (b)

(000's omitted)

absorbed

absorbed

net assets

turnover (c)

Class A

 

 

 

 

 

 

 

 

 

 

0.55%(d)

0.66%(d)

2.17%(d)

 

Year ended 02/29/20

$10.16

$ 0.22

$ 0.24

$ 0.46

$(0.16)

$(0.03)

$(0.19)

$10.43

4.61%

$ 45,383

45%

Year ended 02/28/19

10.29

0.20

(0.08)

0.12

(0.25)

(0.25)

10.16

1.23

46,384

0.55

0.67

1.97

 

37

Year ended 02/28/18

10.58

0.20

(0.29)

(0.09)

(0.20)

(0.20)

10.29

(0.86)

45,609

0.55

0.65

2.02

 

48

Year ended 02/28/17

10.50

0.13

0.08

0.21

(0.12)

(0.01)

(0.13)

10.58

2.04

39,978

0.55

0.70

1.18

 

41

Year ended 02/29/16

10.42

(0.05)

0.14

0.09

(0.01)

(0.01)

10.50

0.83

34,373

0.52

0.90

(0.52)

 

199

Class A2

 

 

 

 

 

 

 

 

 

 

0.45(d)

0.56(d)

2.27(d)

 

45

Year ended 02/29/20

10.17

0.23

0.25

0.48

(0.17)

(0.03)

(0.20)

10.45

4.81

16,641

 

Year ended 02/28/19

10.30

0.21

(0.08)

0.13

(0.26)

(0.26)

10.17

1.33

17,255

0.45

0.57

2.07

 

37

Year ended 02/28/18

10.59

0.22

(0.30)

(0.08)

(0.21)

(0.21)

10.30

(0.76)

19,826

0.45

0.55

2.12

 

48

Year ended 02/28/17

10.51

0.13

0.09

0.22

(0.13)

(0.01)

(0.14)

10.59

2.14

22,234

0.45

0.60

1.28

 

41

Year ended 02/29/16

10.42

(0.05)

0.15

0.10

(0.01)

(0.01)

10.51

0.92

24,851

0.50

0.80

(0.50)

 

199

Class Y

 

 

 

 

 

 

 

 

 

 

0.30(d)

0.41(d)

2.42(d)

 

45

Year ended 02/29/20

10.18

0.25

0.24

0.49

(0.19)

(0.03)

(0.22)

10.45

4.86

17,906

 

Year ended 02/28/19

10.31

0.23

(0.08)

0.15

(0.28)

(0.28)

10.18

1.48

9,843

0.30

0.42

2.22

 

37

Year ended 02/28/18

10.59

0.24

(0.29)

(0.05)

(0.23)

(0.23)

10.31

(0.51)

12,778

0.30

0.40

2.27

 

48

Year ended 02/28/17

10.51

0.15

0.09

0.24

(0.14)

(0.02)

(0.16)

10.59

2.30

9,656

0.30

0.45

1.43

 

41

Year ended 02/29/16

10.42

(0.05)

0.15

0.10

(0.01)

(0.01)

10.51

0.92

10,471

0.48

0.65

(0.48)

 

199

Class R5

 

 

 

 

 

 

 

 

 

 

0.29(d)

0.29(d)

2.43(d)

 

 

Year ended 02/29/20

10.18

0.25

0.23

0.48

(0.19)

(0.03)

(0.22)

10.44

4.81

2,340

 

45

Year ended 02/28/19

10.31

0.23

(0.08)

0.15

(0.28)

(0.28)

10.18

1.50

2,976

0.28

0.28

2.24

 

37

Year ended 02/28/18

10.59

0.24

(0.29)

(0.05)

(0.23)

(0.23)

10.31

(0.50)

723

0.29

0.29

2.28

 

48

Year ended 02/28/17

10.52

0.15

0.08

0.23

(0.14)

(0.02)

(0.16)

10.59

2.21

783

0.30

0.32

1.43

 

41

Year ended 02/29/16

10.43

(0.05)

0.15

0.10

(0.01)

(0.01)

10.52

0.95

608

0.48

0.59

(0.48)

 

199

Class R6

 

 

 

 

 

 

 

 

 

 

0.26(d)

0.26(d)

2.46(d)

 

45

Year ended 02/29/20

10.18

0.25

0.24

0.49

(0.19)

(0.03)

(0.22)

10.45

4.92

467,061

 

Year ended 02/28/19

10.31

0.23

(0.08)

0.15

(0.28)

(0.28)

10.18

1.52

624,598

0.27

0.27

2.25

 

37

Year ended 02/28/18

10.59

0.24

(0.29)

(0.05)

(0.23)

(0.23)

10.31

(0.48)

709,402

0.26

0.26

2.31

 

48

Year ended 02/28/17

10.51

0.15

0.09

0.24

(0.14)

(0.02)

(0.16)

10.59

2.32

718,865

0.29

0.29

1.44

 

41

Year ended 02/29/16(e)

10.40

(0.01)

0.12

0.11

10.51

1.06

36,414

0.30(f)

0.46(f)

(0.30)(f)

 

199

(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 based on average daily net assets (000's omitted) of $44,861, $16,895, $13,713 , $2,649 and $485,419 for Class A, Class A2, Class Y, Class R5 and Class R6 shares, respectively.

(e)Commencement date of December 31, 2015.

(f)Annualized.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco Short Duration Inflation Protected Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco Short Duration Inflation Protected Fund (the "Fund"), is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"). The Trust is organized as a Delaware statutory trust and is 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 provide protection from the negative effects of unanticipated inflation.

The Fund currently consists of five different classes of shares: Class A, Class A2, Class Y, Class R5 and Class R6. Class A and Class A2 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 Y, Class R5 and Class R6 shares are sold at net asset value.

As of the close of business on October 30, 2002, Class A2 shares are closed to new investors.

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.

Securities are fair valued using an evaluated quote provided by an independent pricing service approved by the Board of Trustees. 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, yield, quality, coupon rate, maturity, type of issue, 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 securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and principal payments.

Securities for which market quotations either 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. Some of the factors which may be considered in determining fair value are fundamental analytical data relating to the investment; the nature and duration of any restrictions on transferability or disposition; trading in similar securities by the same issuer or comparable companies; relevant political, economic or issuer specific news; and other relevant factors under the circumstances.

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 economic conditions, interest rates, investor perceptions 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 settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received.

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 realized and unrealized capital gains and losses to a class based on the relative net assets of each class. The Fund allocates income to a class based on the relative value of the settled shares of each class.

C.Distributions - Distributions from net investment income, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from 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.

D.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.

E.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.

F.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.

14

Invesco Short Duration Inflation Protected Fund

G.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.

H.Treasury Inflation-Protected Securities — The Fund may invest in Treasury Inflation-Protected Securities ("TIPS"). TIPS are fixed income securities whose principal value is periodically adjusted to the rate of inflation. The principal value of TIPS will be adjusted upward or downward, and any increase or decrease in the principal amount of TIPS will be shown as Treasury Inflation-Protected Securities inflation adjustments in the Statement of Operations, even though investors do not receive their principal until maturity.

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

0.200%

Over $500 million

0.175%

 

 

For the year ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.20%.

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, 2020, 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 A2, Class Y, Class R5 and Class R6 shares to 0.55%, 0.45%, 0.30%, 0.30% and 0.30%, respectively, of 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, 2020. 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 has contractually agreed, through at least June 30, 2021, 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 year ended February 29, 2020, the Adviser waived advisory fees of $306 and reimbursed class level expenses of $49,424, $18,614, $15,107, $0 and $0 of Class A, Class A2, 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 year ended February 29, 2020, 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 year ended February 29, 2020, 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 A2, 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 A2 shares (collectively, the "Plans"). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the average daily net assets of Class A shares and 0.15% of the Fund's average daily net assets of Class A2 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") also 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 year ended February 29, 2020, 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 and Class A2 shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the year ended February 29, 2020, IDI advised the Fund that IDI retained $7,068 and $141 in front-end sales commissions from the sale of Class A and Class A2 shares, respectively, and $4,444 and $0 from Class A and Class A2 shares, respectively, for CDSC was 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.

15

Invesco Short Duration Inflation Protected Fund

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.

As of February 29, 2020, all of the securities in this Fund were valued based on Level 2 inputs (see the Schedule of Investments for security categories). 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.

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $1,277.

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 may borrow for leveraging in an amount up to 5% of the Fund's total assets (excluding the amount borrowed) at the time the borrowing is made. In doing so, 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—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 29, 2020 and February 28, 2019:

 

 

2020

2019

 

 

Ordinary income

$10,775,082

$20,393,483

 

Return of capital

1,915,698

 

 

 

 

 

Total distributions

$12,690,780

$20,393,483

 

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

2020

 

 

Net unrealized appreciation — investments

 

$ 8,399,888

 

Temporary book/tax differences

 

(94,787)

 

 

 

 

Late-Year ordinary loss deferral

 

(565,161)

 

 

 

 

Capital loss carryforward

 

(21,657,655)

Shares of beneficial interest

 

563,248,107

 

 

 

 

 

Total net assets

 

$549,330,392

 

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to TIPS and wash sales.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund has a capital loss carryforward as of February 29, 2020, as follows:

Capital Loss Carryforward*

Expiration

Short-Term

Long-Term

Total

Not subject to expiration

$1,826,279

$19,831,376

$21,657,655

*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.

16

Invesco Short Duration Inflation Protected Fund

NOTE 8—Investment Transactions

The aggregate amount of long-term U.S. government obligations (other than short-term securities and money market funds, if any) purchased and sold by the Fund during the year ended February 29, 2020 was $255,604,810 and $432,032,063, 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

$8,705,633

 

Aggregate unrealized (depreciation) of investments

(305,745)

Net unrealized appreciation of investments

$8,399,888

 

Cost of investments for tax purposes is $540,863,027.

NOTE 9—Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of return of capital, on February 29, 2020, undistributed net investment income was increased by $1,917,885, undistributed net realized gain (loss) was decreased by $2,187 and shares of beneficial interest was decreased by $1,915,698. This reclassification had no effect on the net assets of the Fund.

NOTE 10—Share Information

Summary of Share Activity

 

Year ended

Year ended

 

February 29, 2020(a)

 

February 28, 2019

 

 

Shares

 

Amount

Shares

 

Amount

Sold:

 

 

 

 

 

 

 

 

 

Class A

1,706,717

$

17,580,951

3,347,554

$

34,257,861

 

Class A2

15,427

 

158,707

21,865

 

224,603

 

 

Class Y

1,750,771

 

18,092,154

719,407

 

7,410,177

 

 

Class R5

49,765

 

510,746

227,117

 

2,290,484

 

Class R6

2,149,948

 

22,180,815

2,770,866

 

28,410,115

 

Issued as reinvestment of dividends:

 

 

 

 

 

 

 

 

 

Class A

72,327

 

742,797

103,160

 

1,048,727

 

 

Class A2

28,207

 

289,967

41,506

 

422,514

 

 

Class Y

21,461

 

220,733

29,914

 

304,595

 

 

Class R5

1,106

 

11,382

592

 

6,003

 

 

Class R6

1,089,631

 

11,193,032

1,805,587

 

18,386,854

 

Reacquired:

 

 

 

 

 

 

 

 

 

Class A

(1,993,431)

 

(20,505,271)

(3,317,813)

 

(33,912,937)

 

 

 

 

 

 

 

 

Class A2

(146,446)

 

(1,508,207)

(291,586)

 

(2,980,312)

 

 

 

 

 

 

 

 

Class Y

(1,025,733)

 

(10,617,139)

(1,021,967)

 

(10,485,046)

 

 

 

 

 

 

 

 

Class R5

(119,124)

 

(1,231,477)

(5,492)

 

(55,928)

 

 

 

 

 

 

 

 

Class R6

(19,895,701)

 

(203,635,214)

(12,029,764)

 

(123,288,940)

 

 

 

 

 

 

 

 

Net increase (decrease) in share activity

(16,295,075)

$

(166,516,024)

(7,599,054)

$

(77,961,230)

 

 

 

 

 

 

 

 

 

 

(a)There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 77% 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.

NOTE 11—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

17

Invesco Short Duration Inflation Protected Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Short Duration Inflation Protected Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Short Duration Inflation Protected Fund (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the periods indicated therein (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the periods indicated therein in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, Texas

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

18

Invesco Short Duration Inflation Protected 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 September 1, 2019 through February 29, 2020.

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

 

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

 

Period2

Ratio

Class A

$1,000.00

$1,015.60

 

$2.76

$1,022.13

 

$2.77

0.55%

 

 

 

 

 

 

 

 

 

Class A2

1,000.00

1,017.10

 

2.26

1,022.63

 

2.26

0.45

 

 

 

 

 

 

 

 

 

Class Y

1,000.00

1,017.80

 

1.51

1,023.37

 

1.51

0.30

 

 

 

 

 

 

 

 

 

Class R5

1,000.00

1,017.10

 

1.55

1,023.32

 

1.56

0.31

Class R6

1,000.00

1,017.20

 

1.30

1,023.57

 

1.31

0.26

 

 

 

 

 

 

 

 

 

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

19

Invesco Short Duration Inflation Protected Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Federal and State Income Tax

Ordinary Income

$10,775,082

Qualified Dividend Income*

0.00%

Corporate Dividends Received Deduction*

0.00%

U.S. Treasury Obligations*

100.00%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

20

Invesco Short Duration Inflation Protected Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

T-1

Invesco Short Duration Inflation Protected Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

 

 

 

 

 

T-2

Invesco Short Duration Inflation Protected Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-3

Invesco Short Duration Inflation Protected Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-4

Invesco Short Duration Inflation Protected Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-5

Invesco Short Duration Inflation Protected Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-6

Invesco Short Duration Inflation Protected Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

State Street Bank and Trust Company

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

225 Franklin Street

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Boston, MA 02110-2801

T-7

Invesco Short Duration Inflation Protected Fund

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 holdings four times in each fiscal year, at the quarter-ends. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 003-39519

Invesco Distributors, Inc.

SDIP-AR-1

Annual Report to Shareholders

February 29, 2020

Invesco Short Term Bond Fund

Nasdaq:

A: STBAX ￿ C: STBCX ￿ R: STBRX ￿ Y: STBYX ￿ R5: ISTBX ￿ R6: ISTFX

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's web- site, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco.com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call (800) 959-4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

2Letters to Shareholders

4 Management's Discussion

4 Performance Summary

6 Long-Term Fund Performance

8 Supplemental Information

9 Schedule of Investments

17 Financial Statements

20 Financial Highlights

21 Notes to Financial Statements

27Report of Independent Registered Public Accounting Firm

28Fund Expenses

29Tax Information

T-1 Trustees and Officers

Andrew Schlossberg

Letters to Shareholders

Dear Shareholders:

This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period.

The reporting period proved to be another tumultuous time for both global equities and fixed-income secu- rities. In early 2019, global equity markets were buoyed by a more accommodative stance from central banks and optimism about a potential US-China trade deal. In May, US-China trade concerns and slowing global growth led to a global equity sell-off and rally in US Treasuries. Despite the May sell-off, domestic equity mar- kets rallied in June in anticipation of a US Federal Reserve (the Fed) interest rate cut and closed the second quarter with modest gains. Continued US-China trade worries and signs of slowing global economic growth led to increased market volatility in August. The US Treasury yield curve inverted several times as fears of a US recession increased. As a result, global equity markets were largely flat for the third quarter. In the final

months of 2019, geopolitical and macroeconomic issues largely abated. This combined with better-than-expected third quarter corporate earnings and initial agreement of the phase one US-China trade deal provided a favorable backdrop for equities and impressive fourth quar- ter global equity returns.

As the new year began, US equities were largely buoyed in January by the signing of the phase one trade agreement and strong eco- nomic data although returns were dampened by the spread of the Coronavirus (COVID-19). Concerns over the virus had a greater impact on international equities, which were largely lower for the month. As the virus spread outside of China and the number of cases increased, fears of diminished global growth led to a sharp global equity sell-off at the end of February 2020 and sent the yield on the US 10-year Treasury to a new all-time low.

Throughout 2019, central banks continued to be accommodative, providing sources of liquidity. In July, the Fed lowered interest rates for the first time in 11 years. It again lowered rates in September and once again in October. During the rest of the year, the Fed left rates unchanged. Overseas, the European Central Bank left its policy rate unchanged and continued its bond purchasing program. In 2020, with the increased spread of the coronavirus, the Fed shifted from a more neutral policy to the possibility of further rate cuts in the new year. As 2020 unfolds, we'll see how the interplay of interest rates, economic data, geopolitics and a host of other factors affect US and overseas equity and fixed income markets.

Investor uncertainty and market volatility, such as we witnessed during the reporting period, are unfortunate facts of life when it comes to investing. That's why Invesco encourages investors to work with a professional financial adviser who can stress the importance of starting to save and invest early and the importance of adhering to a disciplined investment plan. A financial adviser who knows your unique finan- cial situation, investment goals and risk tolerance can be an invaluable partner as you seek to achieve your financial goals. Financial advis- ers can also offer a long-term perspective when markets are volatile and time-tested advice and guidance when your financial situation or investment goals change.

Visit our website for more information on your investments

Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you'll find detailed infor- mation about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select "Log In" on the right side of the homepage, and then select "Register for Individual Account Access."

In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it.

Finally, I'm pleased to share with you Invesco's commitment to both the Principles for Responsible Investment and to considering environ- mental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.

Have questions?

For questions about your account, contact an Invesco client services representative at 800 959 4246.

All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.

Sincerely,

Andrew Schlossberg

Head of the Americas,

Senior Managing Director, Invesco Ltd.

2Invesco Short Term Bond Fund

Bruce Crockett

Dear Shareholders:

Among the many important lessons I've learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate.

As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco's mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to:

￿Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time.

￿ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions.

￿Assessing each portfolio management team's investment performance within the context of the investment strategy described in the fund's prospectus.

￿Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.

We believe one of the most important services we provide our fund shareholders is the annual review of the funds' advisory and sub-

advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.

I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.

Sincerely,

Bruce L. Crockett

Independent Chair

Invesco Funds Board of Trustees

3Invesco Short Term Bond Fund

Management's Discussion of Fund Performance

Performance summary

For the fiscal year ended February 29, 2020, Class A shares of Invesco Short Term Bond Fund (the Fund), at net asset value (NAV), outperformed the Fund's style- specific benchmark, the Bloomberg Barclays 1-3 Year Government/Credit Index.

Your Fund's long-term performance appears later in this report.

Fund vs. Indexes

Total returns, February 28, 2019 to February 29, 2020, 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

5.08%

Class C Shares

4.71

Class R Shares

4.70

Class Y Shares

5.11

Class R5 Shares

5.20

Class R6 Shares

5.23

Bloomberg Barclays U.S. Aggregate Bond Index￿ (Broad Market Index)

11.68

Bloomberg Barclays 1-3 Year Government/Credit Index￿ (Style-Specific Index)

4.88

Lipper Short Investment Grade Debt Funds Index￿ (Peer Group Index)

4.80

Source(s): ￿RIMES Technologies Corp.; ￿Lipper Inc.

15% of the portfolio, on average, had a final maturity of less than one year; this provided sufficient liquidity and an important buffer against credit market volatility. The Fund did not use any credit derivatives during the fiscal year.

The Fund may use active duration and yield curve positioning for risk management and for generating alpha versus its style-specific benchmark. (Alpha is a measure of perfor- mance on a risk adjusted basis.) Duration measures a portfolio's price sensitivity to in- terest rate changes, with a shorter duration portfolio tending to be less sensitive to these changes. Duration of the portfolio was main- tained near the style-specific benchmark, on average, and the timing of changes and the degree of variance from the Fund's style- specific benchmark during the fiscal year had a minimal impact on relative Fund returns. Yield curve positioning, obtained by over- weight exposure to longer maturities and un- derweight exposure to shorter-term maturi- ties, benefited the Fund during the fiscal year.

Market conditions and your Fund

During the fiscal year, US Treasury yields fell considerably, especially in February 2020, as concerns regarding the spread of the corona- virus took hold. The Bloomberg Barclays

1-3 Year Government/Credit Index ended the fiscal year with a strong return of 4.88%. US investment grade bonds and US high yield bonds posted gains for the fiscal year, as well. The short-term, investment grade US credit market also performed strongly. Short-term credit spreads tightened for most of the fiscal year, but with worries stemming from the Coronavirus (COVID-19), spreads widened in the final month of the fiscal year. With spreads roughly unchanged over the past

12 months, the primary driver of returns was the decline in US Treasury yields. In particu- lar, the three-year US Treasury yield fell from 2.50% at the beginning of the fiscal year to 0.85% as of February 29, 2020.1

During the fiscal year, the US Federal Re- serve (the Fed) cut interest rates three times: in July, September and October 2019, for a total decrease of 75 basis points.2 (A basis point is one one-hundredth of a percent- age point.) As a result, the federal funds tar- get rate stood at a range of 1.50% to 1.75% on October 31, 2019, as well as at the end of the fiscal year.2 In addition to the decline in

Portfolio Composition

By security type

% of total net assets

U.S. Dollar Denominated Bonds &

Notes

61.23%

Asset-Backed Securities

28.12

U.S. Treasury Securities

7.42

Security Types Each Less Than

1% of Portfolio

0.64

Money Market Funds Plus Other

Assets Less Liabilities

2.59

the federal funds target rate, US Treasury rates fell across all maturities.

The Fund, at NAV, generated positive abso- lute returns for the fiscal year and outper- formed its style-specific benchmark, the Bloomberg Barclays 1-3 Year Government/ Credit Index.

The Fund's overweight allocation to and security selection in the investment grade corporate credit sector was the primary driver of Fund performance relative to the style-specific benchmark during the fiscal year. In particular, overweight allocation to and security selection in the industrials, tech- nology, media and telecom, and consumer non-cyclical sectors contributed the most to the Fund's relative performance. Out-of-index exposure to high yield credit securities and non-agency mortgage-backed securities boosted relative performance, as well. Our overall duration positioning during the fiscal year was in line with the Fund's style-specific benchmark and, as a result, did not have an impact on relative performance. The Fund's cash position detracted from relative perfor- mance as most fixed income sectors outper- formed liquidity instruments for the fiscal year.

During the fiscal year, we used several strategies in seeking to manage overall risk in the Fund and manage liquidity needs. Throughout the fiscal year, approximately

Top Five Debt Holdings

% of total net assets

1. U.S. Treasury Notes

3.2%

2. U.S. Treasury Notes

3.2

3. Morgan Stanley

1.9

4. Continental Resources, Inc.

1.9

5. Cigna Corp.

1.5

Buying and selling US Treasury futures was an important tool used for the management of interest rate risk and to maintain our tar- geted portfolio duration.

Please note that our strategy may be implemented using derivative instruments, including futures, forward foreign currency contracts, swaps and options. Therefore, a portion of the performance of the strategy, both positive and negative, can be attributed to these instruments. Derivatives can be a cost-effective way to gain or hedge exposure to certain risks. However, derivatives may amplify traditional investment risks through the creation of leverage and may be less liq- uid than traditional securities.

We wish to remind you that the Fund is subject to interest rate risk, meaning when interest rates rise, the value of fixed income securities tends to fall. The risk may be greater in the current market environment because interest rates are near historic lows. The degree to which the value of fixed income securities may decline due to rising interest rates may vary depending on the speed and magnitude of the increase in interest rates, as well as individual security characteristics, such as price, maturity, duration and coupon and market forces, such as supply and de- mand for like similar securities. We are moni- toring interest rates, and the market, eco- nomic and geopolitical factors that may

The Fund's holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.

Data presented here are as of February 29, 2020.

4Invesco Short Term Bond Fund

impact the direction, speed and magnitude of changes to interest rates across the maturity spectrum, including the potential impact of monetary policy changes by the Fed and cer- tain foreign central banks. If interest rates rise or fall faster than expected, markets may experience increased volatility, which may affect the value and/or liquidity of certain of the Fund's investments.

Thank you for investing in Invesco Short Term Bond Fund and for sharing our long- term investment horizon.

1Source: US Department of the Treasury

2 Source: US Federal Reserve

Portfolio Managers:

Matt Brill

Chuck Burge

Michael Hyman

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

See important Fund and, if applicable, index disclosures later in this report.

5Invesco Short Term Bond Fund

Your Fund's Long-Term Performance

Results of a $10,000 Investment — Oldest Share Class(es)

Fund and index data from 2/28/10

$15,000

$14,707 Bloomberg Barclays U.S. Aggregate Bond Index1

$12,392 Lipper Short Investment Grade Debt Funds Index2

$12,052 Invesco Short Term Bond Fund — Class A Shares

12,000 $11,951 Invesco Short Term Bond Fund — Class C Shares $11,697 Bloomberg Barclays 1-3 Year Government/Credit Index1

9,000

2/28/10

2/11

2/12

2/13

2/14

2/15

2/16

2/17

2/18

2/19

2/20

1Source: RIMES Technologies Corp.

2 Source: Lipper Inc.

Past performance cannot guarantee future results.

The data shown in the chart include rein- vested distributions, applicable sales charges and Fund expenses including management

fees. Index results include reinvested divi- dends, but they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses and management fees; performance of a market index does not. Per-

formance shown in the chart and table(s) does not reflect deduction of taxes a share- holder would pay on Fund distributions or sale of Fund shares.

6Invesco Short Term Bond Fund

Average Annual Total Returns

As of 2/29/20, including maximum applicable sales charges

Class A Shares

Inception (4/30/04)

1.97%

10 Years

1.88

5

Years

1.73

1

Year

2.42

Class C Shares

 

Inception (8/30/02)

2.06%

10 Years

1.80

5

Years

1.89

1

Year

4.71

Class R Shares

 

Inception (4/30/04)

1.84%

10 Years

1.80

5

Years

1.91

1

Year

4.70

Class Y Shares

 

Inception (10/3/08)

2.49%

10 Years

2.30

5

Years

2.40

1

Year

5.11

Class R5 Shares

 

Inception (4/30/04)

2.38%

10 Years

2.35

5

Years

2.51

1

Year

5.20

Class R6 Shares

 

10 Years

2.25%

5

Years

2.52

1

Year

5.23

Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class C shares and includes the 12b-1 fees applicable to Class C shares.

The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month- end performance. Performance figures re- flect reinvested distributions, changes in net asset value and the effect of the maxi- mum sales charge unless otherwise stated. Performance figures do not reflect deduc- tion of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.

Class A share performance reflects the maximum 2.50% sales charge. Class C shares have no upfront or contingent de- ferred sales charges; therefore, perfor- mance shown is at net asset value. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.

The performance of the Fund's share classes will differ primarily due to different sales charge structures and class expenses. Fund performance reflects any applicable

fee waivers and/or expense reimburse- ments. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more informa- tion.

7Invesco Short Term Bond Fund

Invesco Short Term Bond Fund's investment objective is total return, comprised of current income and capital appreciation.

￿Unless otherwise stated, information presented in this report is as of February 29, 2020, and is based on total net assets.

￿Unless otherwise noted, all data provided by Invesco.

￿To access your Fund's reports/prospectus, visit invesco.com/fundreports.

About indexes used in this report

￿The Bloomberg Barclays 1-3 Year Government/Credit Index is an unman- aged index considered representative of short-term US corporate bonds and US government bonds with maturities of one to three years.

￿The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index con- sidered representative of the US invest- ment grade, fixed-rate bond market.

￿The Lipper Short Investment Grade Debt Funds Index is an unmanaged index con- sidered representative of short investment grade debt funds tracked by Lipper.

￿The Fund is not managed to track the per- formance of any particular index, including the index(es) described here, and conse- quently, 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. Perfor- mance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.

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

8Invesco Short Term Bond Fund

Schedule of Investments(a)

February 29, 2020

Principal

AmountValue

U.S. Dollar Denominated Bonds & Notes–61.23%

Aerospace & Defense–0.96%

 

 

 

Boeing Co. (The), 2.22%,

 

 

 

11/17/2020(b)

$10,010,000

$

9,866,741

Rockwell Collins, Inc., 2.80%,

 

 

 

03/15/2022

5,414,000

 

5,567,778

 

 

 

15,434,519

Agricultural & Farm Machinery–0.83%

 

 

John Deere Capital Corp.,

 

 

 

2.95%, 04/01/2022

5,000,000

 

5,173,922

2.05%, 01/09/2025

8,000,000

 

8,248,536

 

 

 

13,422,458

Airlines–3.92%

 

 

 

American Airlines Group, Inc.,

 

 

 

5.00%, 06/01/2022(b)

5,332,000

 

5,351,995

American Airlines Pass Through Trust,

 

 

 

Series 2016-3, Class B, 3.75%,

 

 

 

10/15/2025

2,398,077

 

2,495,700

Series 2017-2, Class B, 3.70%,

 

 

 

10/15/2025

2,561,989

 

2,650,471

Series 2019-1, Class B, 3.85%,

 

 

 

02/15/2028

4,172,308

 

4,377,998

Avianca Holdings S.A. (Colombia),

 

 

 

9.00%, 05/10/2023(b)

1,757,000

 

1,489,058

British Airways Pass Through Trust

 

 

 

(United Kingdom), Series 2019-1,

 

 

 

Class A, 3.35%, 06/15/2029(b)

2,478,000

 

2,641,739

Delta Air Lines Pass Through Trust,

 

 

 

Series 2019-1, Class A, 3.40%,

 

 

 

04/25/2024

1,852,000

 

1,972,368

Series 2019-1, Class AA, 3.20%,

 

 

 

04/25/2024

3,568,000

 

3,793,603

Delta Air Lines, Inc.,

 

 

 

2.88%, 03/13/2020

15,951,000

 

15,953,305

3.40%, 04/19/2021

2,426,000

 

2,471,248

3.63%, 03/15/2022

4,138,000

 

4,263,901

Norwegian Air Shuttle ASA Pass

 

 

 

Through Trust (Norway),

 

 

 

Series 2016-1, Class B, 7.50%,

 

 

 

11/10/2023(b)

6,111,072

 

6,481,480

United Airlines Pass Through Trust,

 

 

 

Series 2016-2, Class B, 3.65%,

 

 

 

10/07/2025

2,885,546

 

3,012,627

Series 2018-1, Class B, 4.60%,

 

 

 

03/01/2026

3,427,242

 

3,622,054

Series 2019-2, Class B, 3.50%,

 

 

 

05/01/2028

2,513,000

 

2,607,417

 

 

 

63,184,964

Aluminum–0.31%

 

 

 

PT Indonesia Asahan Aluminium

 

 

 

(Persero) (Indonesia), 5.23%,

 

 

 

11/15/2021(b)

4,800,000

 

5,028,467

Apparel Retail–0.21%

 

 

 

L Brands, Inc., 5.63%,

 

 

 

02/15/2022

3,185,000

 

3,342,275

 

 

Principal

 

 

 

 

Amount

 

Value

Automobile Manufacturers–7.13%

 

 

 

American Honda Finance Corp.,

 

 

 

 

Series 2019-B, Class A2B,

 

 

 

 

2.24% (3 mo. USD LIBOR +

 

 

 

 

0.35%), 06/11/2021(c)

$

6,094,000

$

6,094,000

Ford Motor Credit Co. LLC,

 

 

 

 

5.09%, 01/07/2021

 

4,968,000

 

5,098,027

2.73%, (3 mo. USD LIBOR +

 

 

 

 

0.88%), 10/12/2021(c)

 

6,243,000

 

6,175,569

3.81%, 10/12/2021

 

8,654,000

 

8,831,393

5.60%, 01/07/2022

 

4,592,000

 

4,846,440

3.35%, 11/01/2022

 

4,991,000

 

5,040,118

3.09%, 01/09/2023

 

8,285,000

 

8,312,438

4.06%, 11/01/2024

 

1,000,000

 

1,019,655

General Motors Financial Co., Inc.,

 

 

 

 

2.73%, (3 mo. USD LIBOR +

 

 

 

 

0.85%), 04/09/2021(c)

 

2,420,000

 

2,428,481

3.20%, 07/06/2021

 

2,613,000

 

2,644,196

4.20%, 11/06/2021

 

9,339,000

 

9,653,312

3.55%, 07/08/2022

 

4,018,000

 

4,148,883

Hyundai Capital America,

 

 

 

 

3.95%, 02/01/2022(b)

 

16,000,000

 

16,651,258

2.85%, 11/01/2022(b)

 

6,667,000

 

6,838,781

2.38%, 02/10/2023(b)

 

2,995,000

 

3,022,752

4.30%, 02/01/2024(b)

 

6,601,000

 

7,112,954

2.65%, 02/10/2025(b)

 

3,960,000

 

4,039,347

Toyota Motor Credit Corp., 2.05%

 

 

 

 

(SOFR + 0.40%), 10/23/2020(c)

 

10,000,000

 

10,010,632

Volkswagen Group of America

 

 

 

 

Finance LLC (Germany), 2.65% (3

 

 

 

 

mo. USD LIBOR + 0.94%),

 

 

 

 

11/12/2021(b)(c)

 

2,867,000

 

2,896,402

 

 

 

 

114,864,638

Biotechnology–2.68%

 

 

 

 

AbbVie, Inc.,

 

 

 

 

3.38%, 11/14/2021

 

6,061,000

 

6,246,002

2.15%, 11/19/2021(b)

 

21,785,000

 

21,996,245

2.30%, 11/21/2022(b)

 

6,030,000

 

6,133,477

2.60%, 11/21/2024(b)

 

8,476,000

 

8,764,806

 

 

 

 

43,140,530

Brewers–0.19%

 

 

 

 

Anheuser-Busch InBev Worldwide,

 

 

 

 

Inc. (Belgium), 4.15%,

 

 

 

 

01/23/2025

 

2,803,000

 

3,120,930

Broadcasting–0.08%

 

 

 

 

Fox Corp., 4.03%, 01/25/2024(b)

 

1,180,000

 

1,276,902

Cable & Satellite–1.23%

 

 

 

 

Charter Communications

 

 

 

 

Operating LLC/Charter

 

 

 

 

Communications Operating

 

 

 

 

Capital Corp., 3.58%,

 

 

 

 

07/23/2020

 

19,795,000

 

19,906,618

Construction Machinery & Heavy Trucks–0.20%

 

 

Caterpillar Financial Services Corp.,

 

 

 

 

2.17% (3 mo. USD LIBOR +

 

 

 

 

0.28%), 09/07/2021(c)

 

3,250,000

 

3,258,220

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

9Invesco Short Term Bond Fund

 

 

Principal

 

 

 

 

Amount

 

Value

Construction Materials–0.43%

 

 

 

 

Carrier Global Corp.,

 

 

 

 

1.92%, 02/15/2023(b)

$

3,659,000

$

3,708,891

2.24%, 02/15/2025(b)

 

3,169,000

 

3,227,845

 

 

 

 

6,936,736

Data Processing & Outsourced Services–0.33%

 

 

PayPal Holdings, Inc., 2.20%,

 

 

 

 

09/26/2022

 

5,231,000

 

5,308,423

Diversified Banks–4.85%

 

 

 

 

Banco del Estado de Chile (Chile),

 

 

 

 

2.70%, 01/09/2025(b)

 

6,415,000

 

6,495,187

Banco do Brasil S.A. (Brazil),

 

 

 

 

8.50%(b)(d)

 

1,893,000

 

1,935,015

8.50%(b)(d)

 

5,000,000

 

5,110,975

Barclays Bank PLC (United Kingdom),

 

 

 

 

5.14%, 10/14/2020

 

1,195,000

 

1,220,771

10.18%, 06/12/2021(b)

 

6,000,000

 

6,602,731

Barclays PLC (United Kingdom),

 

 

 

 

3.12% (3 mo. USD LIBOR +

 

 

 

 

1.43%), 02/15/2023(c)

 

5,954,000

 

6,043,146

BBVA Bancomer S.A. (Mexico),

 

 

 

 

7.25%, 04/22/2020(b)

 

592,000

 

594,930

Citigroup, Inc., Series V, 4.70%(c)(d)

 

1,880,000

 

1,857,675

Danske Bank A/S (Denmark),

 

 

 

 

3.00%, (3 mo. USD LIBOR +

 

 

 

 

1.25%), 09/20/2022(b)(c)

 

3,281,000

 

3,330,443

2.95%, (3 mo. USD LIBOR +

 

 

 

 

1.06%), 09/12/2023(b)(c)

 

5,898,000

 

5,936,580

Federation des caisses Desjardins du

 

 

 

 

Quebec (Canada), 2.05%,

 

 

 

 

02/10/2025(b)

 

4,334,000

 

4,389,824

Global Bank Corp. (Panama), 4.50%,

 

 

 

 

10/20/2021(b)

 

6,500,000

 

6,672,250

Industrial & Commercial Bank of

 

 

 

 

China Ltd. (China), 2.96%,

 

 

 

 

11/08/2022

 

905,000

 

932,483

ING Groep N.V. (Netherlands),

 

 

 

 

6.00%(d)

 

3,735,000

 

3,734,626

JPMorgan Chase & Co.,

 

 

 

 

Series HH, 4.60% (SOFR +

 

 

 

 

3.13%)(c)(d)

 

2,735,000

 

2,752,094

Series I, 5.24% (3 mo. USD LIBOR

 

 

 

 

+ 3.47%)(c)(d)

 

1,956,000

 

1,955,501

Series V, 5.23% (3 mo. USD

 

 

 

 

LIBOR + 3.32%)(c)(d)

 

1,390,000

 

1,385,476

PNC Bank NA, 2.32% (3 mo. USD

 

 

 

 

LIBOR + 0.43%), 12/09/2022(c)

 

8,000,000

 

8,041,143

Skandinaviska Enskilda Banken AB

 

 

 

 

(Sweden), 2.53% (3 mo. USD

 

 

 

 

LIBOR + 0.65%),

 

 

 

 

12/12/2022(b)(c)

 

5,559,000

 

5,601,219

Standard Chartered PLC (United

 

 

 

 

Kingdom), 2.97% (3 mo. USD

 

 

 

 

LIBOR + 1.15%),

 

 

 

 

01/20/2023(b)(c)

 

1,379,000

 

1,390,610

Wells Fargo & Co., Series K, 5.66%

 

 

 

 

(3 mo. USD LIBOR + 3.77%)(c)(d)

 

2,150,000

 

2,152,688

 

 

 

 

78,135,367

Diversified Capital Markets–0.43%

 

 

 

Credit Suisse Group AG

 

 

 

 

(Switzerland), 3.57%,

 

 

 

 

01/09/2023(b)

 

6,700,000

 

6,929,457

 

Principal

 

 

 

Amount

 

Value

Electric Utilities–0.75%

 

 

 

Exelon Corp.,

 

 

 

2.85%, 06/15/2020

$ 4,285,000

$

4,295,344

3.50%, 06/01/2022

3,678,000

 

3,818,036

Georgia Power Co., 2.85%,

 

 

 

05/15/2022

3,781,000

 

3,904,053

 

 

 

12,017,433

Financial Exchanges & Data–0.32%

 

 

Moody's Corp., 3.25%,

 

 

 

06/07/2021

5,081,000

 

5,191,696

Food Retail–0.18%

 

 

 

Albertson's Cos., Inc./Safeway,

 

 

 

Inc./New Albertson's

 

 

 

L.P./Albertson's LLC, 3.50%,

 

 

 

02/15/2023(b)

2,922,000

 

2,932,958

Health Care Distributors–1.03%

 

 

 

Cardinal Health, Inc., 2.62%,

 

 

 

06/15/2022

4,999,000

 

5,120,551

McKesson Corp., 3.65%,

 

 

 

11/30/2020

11,340,000

 

11,520,761

 

 

 

16,641,312

Health Care Equipment–0.72%

 

 

 

Becton, Dickinson and Co., 2.40%,

 

 

 

06/05/2020

5,358,000

 

5,368,698

Zimmer Biomet Holdings, Inc.,

 

 

 

2.65% (3 mo. USD LIBOR +

 

 

 

0.75%), 03/19/2021(c)

6,250,000

 

6,251,240

 

 

 

11,619,938

Health Care Services–2.47%

 

 

 

Cigna Corp.,

 

 

 

3.20%, 09/17/2020

24,000,000

 

24,182,443

3.40%, 09/17/2021

7,772,000

 

7,975,735

3.75%, 07/15/2023

3,696,000

 

3,937,147

CVS Health Corp., 3.70%,

 

 

 

03/09/2023

3,516,000

 

3,717,615

 

 

 

39,812,940

Hotels, Resorts & Cruise Lines–0.54%

 

 

Marriott International, Inc., Series Y,

 

 

 

2.18% (3 mo. USD LIBOR +

 

 

 

0.60%), 12/01/2020(c)

8,718,000

 

8,739,069

Insurance Brokers–0.18%

 

 

 

Marsh & McLennan Cos., Inc.,

 

 

 

3.88%, 03/15/2024

2,665,000

 

2,899,466

Integrated Oil & Gas–1.63%

 

 

 

Occidental Petroleum Corp., 2.60%,

 

 

 

08/13/2021

2,192,000

 

2,220,546

Saudi Arabian Oil Co. (Saudi Arabia),

 

 

 

2.75%, 04/16/2022(b)

14,633,000

 

14,870,738

2.88%, 04/16/2024(b)

8,952,000

 

9,201,086

 

 

 

26,292,370

Integrated Telecommunication Services–0.45%

 

 

AT&T, Inc.,

 

 

 

2.45%, 06/30/2020

4,426,000

 

4,430,494

3.07%, (3 mo. USD LIBOR +

 

 

 

1.18%), 06/12/2024(c)

2,732,000

 

2,765,887

 

 

 

7,196,381

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

10

Invesco Short Term Bond Fund

 

Principal

 

 

 

Amount

 

Value

Interactive Media & Services–0.92%

 

 

Tencent Holdings Ltd. (China),

 

 

 

2.99%, 01/19/2023(b)

$ 4,039,000

$

4,177,265

3.28%, 04/11/2024(b)

10,000,000

 

10,591,610

 

 

 

14,768,875

Internet & Direct Marketing Retail–0.09%

 

 

QVC, Inc., 4.75%, 02/15/2027

1,475,000

 

1,453,551

Investment Banking & Brokerage–2.93%

 

 

Cantor Fitzgerald L.P., 6.50%,

 

 

 

06/17/2022(b)

4,519,000

 

4,953,316

Goldman Sachs Group, Inc. (The),

 

 

 

5.38%, 03/15/2020

10,000,000

 

10,012,469

2.97%, (3 mo. USD LIBOR +

 

 

 

1.16%), 04/23/2020(c)

2,092,000

 

2,093,070

Morgan Stanley, 2.38% (SOFR +

 

 

 

0.83%), 06/10/2022(c)

30,000,000

 

30,164,637

 

 

 

47,223,492

Leisure Products–0.25%

 

 

 

Hasbro, Inc., 2.60%, 11/19/2022

3,860,000

 

3,973,467

Life & Health Insurance–2.53%

 

 

 

AIG Global Funding, 2.70%,

 

 

 

12/15/2021(b)

7,047,000

 

7,176,070

New York Life Global Funding,

 

 

 

2.01% (3 mo. USD LIBOR +

 

 

 

0.28%), 01/10/2023(b)(c)

20,000,000

 

20,023,951

Protective Life Global Funding,

 

 

 

2.16%, 09/25/2020(b)

5,000,000

 

5,018,844

Reliance Standard Life Global

 

 

 

Funding II, 2.50%,

 

 

 

10/30/2024(b)

8,350,000

 

8,634,330

 

 

 

40,853,195

Managed Health Care–0.45%

 

 

 

UnitedHealth Group, Inc., 2.38%,

 

 

 

08/15/2024

7,000,000

 

7,234,715

Marine Ports & Services–0.12%

 

 

 

Adani Abbot Point Terminal Pty. Ltd.

 

 

 

(Australia), 4.45%,

 

 

 

12/15/2022(b)

1,916,000

 

1,954,390

Multi-Utilities–1.00%

 

 

 

CenterPoint Energy, Inc., 2.50%,

 

 

 

09/01/2024

2,960,000

 

3,058,430

Dominion Energy, Inc., 2.72%,

 

 

 

08/15/2021(e)

8,214,000

 

8,347,507

WEC Energy Group, Inc., 3.10%,

 

 

 

03/08/2022

4,620,000

 

4,767,954

 

 

 

16,173,891

Office REITs–0.31%

 

 

 

SL Green Operating Partnership L.P.,

 

 

 

2.67% (3 mo. USD LIBOR +

 

 

 

0.98%), 08/16/2021(c)

5,000,000

 

5,001,079

Oil & Gas Exploration & Production–1.84%

 

 

Continental Resources, Inc., 5.00%,

 

 

 

09/15/2022

29,710,000

 

29,676,721

Oil & Gas Refining & Marketing–0.14%

 

 

Phillips 66, 2.25% (3 mo. USD

 

 

 

LIBOR + 0.60%), 02/26/2021(c)

2,264,000

 

2,264,219

 

Principal

 

 

 

Amount

 

Value

Oil & Gas Storage & Transportation–3.18%

 

 

DCP Midstream Operating L.P.,

 

 

 

5.35%, 03/15/2020(b)

$ 4,285,000

$

4,290,437

Energy Transfer Operating L.P.,

 

 

 

2.90%, 05/15/2025

4,079,000

 

4,165,760

Enterprise Products Operating LLC,

 

 

 

3.50%, 02/01/2022

5,000,000

 

5,211,326

Series D, 4.88%, 08/16/2077(c)

8,270,000

 

8,119,031

MPLX L.P.,

 

 

 

2.79%, (3 mo. USD LIBOR +

 

 

 

0.90%), 09/09/2021(c)

7,864,000

 

7,887,362

2.99%, (3 mo. USD LIBOR +

 

 

 

1.10%), 09/09/2022(c)

5,687,000

 

5,708,401

Plains All American Pipeline L.P./PAA

 

 

 

Finance Corp., 5.00%,

 

 

 

02/01/2021

3,300,000

 

3,360,334

Western Midstream Operating L.P.,

 

 

 

2.70%, (3 mo. USD LIBOR +

 

 

 

0.85%), 01/13/2023(c)

4,411,000

 

4,395,605

3.10%, 02/01/2025

1,764,000

 

1,764,813

Williams Cos., Inc. (The), 4.13%,

 

 

 

11/15/2020

6,233,000

 

6,297,294

 

 

 

51,200,363

Other Diversified Financial Services–0.12%

 

 

USAA Capital Corp., 2.45%,

 

 

 

08/01/2020(b)

2,000,000

 

2,010,317

Pharmaceuticals–1.76%

 

 

 

Allergan Funding S.C.S., 3.14% (3

 

 

 

mo. USD LIBOR + 1.26%),

 

 

 

03/12/2020(c)

9,600,000

 

9,602,952

Bristol-Myers Squibb Co.,

 

 

 

2.88%, 02/19/2021(b)

3,500,000

 

3,545,639

2.60%, 05/16/2022(b)

10,690,000

 

10,969,847

GlaxoSmithKline Capital PLC (United

 

 

 

Kingdom), 2.88%, 06/01/2022

4,214,000

 

4,339,093

 

 

 

28,457,531

Property & Casualty Insurance–0.55%

 

 

Suncorp-Metway Ltd. (Australia),

 

 

 

2.35%, 04/27/2020(b)

8,805,000

 

8,814,972

Regional Banks–2.39%

 

 

 

Citizens Financial Group, Inc.,

 

 

 

Series A, 5.50%(d)

3,900,000

 

3,881,299

First Niagara Financial Group, Inc.,

 

 

 

7.25%, 12/15/2021

750,000

 

821,596

KeyBank N.A., 2.50%, 11/22/2021

4,023,000

 

4,105,503

Synovus Financial Corp., 5.75% (3

 

 

 

mo. USD LIBOR + 4.18%),

 

 

 

12/15/2025(c)

7,885,000

 

8,124,822

Truist Bank, 2.25%, 06/01/2020

6,720,000

 

6,728,325

Zions Bancorporation N.A.,

 

 

 

3.50%, 08/27/2021

9,550,000

 

9,817,406

3.35%, 03/04/2022

4,861,000

 

5,013,373

 

 

 

38,492,324

Semiconductors–2.30%

 

 

 

Analog Devices, Inc., 2.50%,

 

 

 

12/05/2021

4,825,000

 

4,905,499

Broadcom Corp./Broadcom Cayman

 

 

 

Finance Ltd., 3.00%,

 

 

 

01/15/2022

15,000,000

 

15,299,256

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

11

Invesco Short Term Bond Fund

 

Principal

 

 

 

Amount

 

Value

Semiconductors–(continued)

 

 

 

Broadcom, Inc.,

 

 

 

3.13%, 04/15/2021(b)

$ 4,800,000

$

4,875,319

3.13%, 10/15/2022(b)

6,600,000

 

6,821,393

NXP B.V./NXP Funding LLC

 

 

 

(Netherlands), 4.13%,

 

 

 

06/01/2021(b)

5,000,000

 

5,140,832

 

 

 

37,042,299

Soft Drinks–0.29%

 

 

 

Keurig Dr Pepper, Inc., 3.55%,

 

 

 

05/25/2021

4,604,000

 

4,715,452

Specialized Finance–0.13%

 

 

 

Park Aerospace Holdings Ltd.

 

 

 

(Ireland), 5.25%,

 

 

 

08/15/2022(b)

2,000,000

 

2,129,119

Specialized REITs–0.60%

 

 

 

Equinix, Inc., 2.63%, 11/18/2024

9,480,000

 

9,755,157

Specialty Chemicals–0.19%

 

 

 

International Flavors & Fragrances,

 

 

 

Inc., 3.40%, 09/25/2020

3,000,000

 

3,025,335

Steel–1.54%

 

 

 

POSCO (South Korea),

 

 

 

2.38%, 01/17/2023(b)

9,145,000

 

9,295,429

2.50%, 01/17/2025(b)

4,990,000

 

5,059,559

Steel Dynamics, Inc., 5.50%,

 

 

 

10/01/2024

10,096,000

 

10,401,404

 

 

 

24,756,392

Systems Software–0.65%

 

 

 

VMware, Inc.,

 

 

 

2.30%, 08/21/2020

6,705,000

 

6,713,328

2.95%, 08/21/2022

3,604,000

 

3,710,303

 

 

 

10,423,631

Technology Hardware, Storage & Peripherals–0.30%

 

Dell International LLC/EMC Corp.,

 

 

 

4.00%, 07/15/2024(b)

4,545,000

 

4,871,524

Tobacco–0.72%

 

 

 

Altria Group, Inc., 3.49%,

 

 

 

02/14/2022

7,017,000

 

7,270,079

BAT Capital Corp. (United Kingdom),

 

 

 

2.79%, 09/06/2024

4,148,000

 

4,267,838

 

 

 

11,537,917

Trucking–2.27%

 

 

 

Aviation Capital Group LLC, 2.44%

 

 

 

(3 mo. USD LIBOR + 0.67%),

 

 

 

07/30/2021(b)(c)

1,860,000

 

1,867,182

Avolon Holdings Funding Ltd.

 

 

 

(Ireland), 3.63%,

 

 

 

05/01/2022(b)

2,760,000

 

2,826,714

DAE Funding LLC (United Arab

 

 

 

Emirates), 4.00%,

 

 

 

08/01/2020(b)

3,192,000

 

3,205,207

Penske Truck Leasing Co. L.P./PTL

 

 

 

Finance Corp.,

 

 

 

3.20%, 07/15/2020(b)

2,374,000

 

2,385,365

3.65%, 07/29/2021(b)

21,478,000

 

22,068,931

 

Principal

 

 

 

Amount

 

Value

Trucking–(continued)

 

 

 

Ryder System, Inc., 2.50%,

 

 

 

09/01/2024

$ 4,100,000

$

4,210,935

 

 

 

36,564,334

Wireless Telecommunication Services–1.61%

 

 

America Movil S.A.B. de C.V.

 

 

 

(Mexico), 5.00%, 03/30/2020

541,000

 

542,314

Sprint Spectrum Co. LLC/Sprint

 

 

 

Spectrum Co. II LLC/Sprint Spectrum

 

 

 

Co. III LLC,

 

 

 

Class A-1, 3.36%,

 

 

 

09/20/2021(b)

7,745,063

 

7,817,479

4.74%, 03/20/2025(b)

12,282,000

 

13,176,928

VEON Holdings B.V. (Netherlands),

 

 

 

4.00%, 04/09/2025(b)

4,343,000

 

4,462,432

 

 

 

25,999,153

Total U.S. Dollar Denominated Bonds & Notes

 

 

(Cost $969,657,982)

 

 

987,007,482

Asset-Backed Securities–28.12%

 

 

ALM VII Ltd., Series 2012-7A,

 

 

 

Class A1A2, 3.00% (3 mo. USD

 

 

 

LIBOR + 1.17%),

 

 

 

07/15/2029(b)(c)

2,230,600

 

2,231,898

Alternative Loan Trust,

 

 

 

Series 2004-8CB, Class A,

 

 

 

2.20% (1 mo. USD LIBOR +

 

 

 

0.27%), 06/25/2034(c)

210,528

 

212,181

Americold LLC Trust, Series 2010-

 

 

 

ARTA, Class A1, 3.85%,

 

 

 

01/14/2029(b)

795,277

 

800,201

Angel Oak Mortgage Trust,

 

 

 

Series 2019-3, Class A1, 2.93%,

 

 

 

05/25/2059(b)(f)

8,492,014

 

8,570,874

Series 2020-1, Class A1, 2.47%,

 

 

 

12/25/2059(b)(f)

2,209,851

 

2,222,700

Angel Oak Mortgage Trust I LLC,

 

 

 

Series 2018-1, Class A1, 3.26%,

 

 

 

04/27/2048(b)(f)

2,709,998

 

2,729,993

Series 2018-3, Class A1, 3.65%,

 

 

 

09/25/2048(b)(f)

5,316,954

 

5,420,243

Series 2019-2, Class A1, 3.63%,

 

 

 

03/25/2049(b)(f)

7,017,900

 

7,152,115

Angel Oak Mortgage Trust LLC,

 

 

 

Series 2017-1, Class A1, 2.81%,

 

 

 

01/25/2047(b)(f)

557,134

 

558,866

Series 2017-3, Class A1, 2.71%,

 

 

 

11/25/2047(b)(f)

696,349

 

698,874

Apex Credit CLO Ltd.,

 

 

 

Series 2017-1A, Class AF,

 

 

 

3.60%, 04/24/2029(b)

3,432,300

 

3,436,064

Banc of America Mortgage Trust,

 

 

 

Series 2004-D, Class 2A2,

 

 

 

4.81%, 05/25/2034(f)

33,011

 

33,525

Bear Stearns Adjustable Rate

 

 

 

Mortgage Trust, Series 2003-6,

 

 

 

Class 1A3, 4.03%,

 

 

 

08/25/2033(f)

67,185

 

68,733

CarMax Auto Owner Trust,

 

 

 

Series 2018-3, Class A3, 3.13%,

 

 

 

06/15/2023

11,500,000

 

11,742,425

Castlelake Aircraft Structured Trust,

 

 

 

Series 2019-1A, Class A, 3.97%,

 

 

 

04/15/2039(b)

3,935,892

 

4,050,214

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

12

Invesco Short Term Bond Fund

 

Principal

 

 

 

Amount

 

Value

Asset-Backed Securities–(continued)

 

 

CGDBB Commercial Mortgage Trust,

 

 

 

Series 2017-BIOC, Class A,

 

 

 

2.45% (1 mo. USD LIBOR +

 

 

 

0.79%), 07/15/2032(b)(c)

$ 5,595,453

$

5,600,032

Series 2017-BIOC, Class C,

 

 

 

2.71% (1 mo. USD LIBOR +

 

 

 

1.05%), 07/15/2032(b)(c)

3,608,496

 

3,608,227

Series 2017-BIOC, Class D,

 

 

 

3.26% (1 mo. USD LIBOR +

 

 

 

1.60%), 07/15/2032(b)(c)

2,204,380

 

2,208,515

Chase Home Lending Mortgage Trust,

 

 

 

Series 2019-ATR2, Class A3,

 

 

 

3.50%, 07/25/2049(b)(f)

9,300,255

 

9,564,969

Citigroup Mortgage Loan Trust,

 

 

 

Series 2019-IMC1, Class A1,

 

 

 

2.72%, 07/25/2049(b)(f)

7,952,740

 

8,026,650

Citigroup Mortgage Loan Trust, Inc.,

 

 

 

Series 2004-UST1, Class A4,

 

 

 

3.93%, 08/25/2034(f)

149,023

 

147,794

COLT Mortgage Loan Trust,

 

 

 

Class 2020-1, Class A1, 2.49%,

 

 

 

02/25/2050(b)(f)

5,157,661

 

5,228,319

Class 2020-1, Class A2, 2.69%,

 

 

 

02/25/2050(b)(f)

2,663,976

 

2,679,974

Credit Suisse Mortgage Trust,

 

 

 

Series 2020-AFC1, Class A1,

 

 

 

2.24%, 02/25/2050(b)(f)

7,455,371

 

7,545,076

CSWF, Series 2018-TOP, Class B,

 

 

 

2.96% (1 mo. USD LIBOR +

 

 

 

1.30%), 08/15/2035(b)(c)

4,415,832

 

4,418,721

DB Master Finance LLC,

 

 

 

Series 2019-1A, Class A2I,

 

 

 

3.79%, 05/20/2049(b)

8,932,500

 

9,274,458

Deephaven Residential Mortgage Trust,

 

 

 

Series 2017-2A, Class A2,

 

 

 

2.61%, 06/25/2047(b)(f)

243,651

 

244,845

Series 2017-2A, Class A3,

 

 

 

2.71%, 06/25/2047(b)(f)

265,274

 

266,637

Series 2017-3A, Class A1,

 

 

 

2.58%, 10/25/2047(b)(f)

1,488,057

 

1,493,018

Series 2017-3A, Class A2,

 

 

 

2.71%, 10/25/2047(b)(f)

435,051

 

436,507

Series 2017-3A, Class A3,

 

 

 

2.81%, 10/25/2047(b)(f)

1,459,901

 

1,464,701

Series 2018-2A, Class A1,

 

 

 

3.48%, 04/25/2058(b)(f)

5,730,550

 

5,736,050

Deephaven Residential Mortgage

 

 

 

Trust , Series 2019-4A, Class A1,

 

 

 

2.79%, 10/25/2059(b)(f)

3,417,521

 

3,446,760

DT Auto Owner Trust,

 

 

 

Series 2019-3A, Class C, 2.74%,

 

 

 

04/15/2025(b)

2,890,000

 

2,938,229

Series 2019-3A, Class D, 2.96%,

 

 

 

04/15/2025(b)

4,146,000

 

4,229,332

Galton Funding Mortgage Trust,

 

 

 

Series 2018-2, Series A41,

 

 

 

4.50%, 10/25/2058(b)(f)

3,367,876

 

3,456,270

Series 2019-H1, Class A1,

 

 

 

2.66%, 10/25/2059(b)(f)

4,063,212

 

4,105,886

GCAT Trust,

 

 

 

Series 2019-NQM2, Class A1,

 

 

 

2.86%, 09/25/2059(b)(e)(f)

5,297,547

 

5,367,168

Series 2019-NQM3, Class A1,

 

 

 

2.69%, 11/25/2059(b)(f)

9,509,173

 

9,665,127

 

 

Principal

 

 

 

 

Amount

 

Value

 

Asset-Backed Securities–(continued)

 

 

Goldentree Loan Management US

 

 

 

 

CLO 2 Ltd., Series 2017-2A,

 

 

 

 

Class A, 2.97% (3 mo. USD LIBOR

 

 

 

 

+ 1.15%), 11/28/2030(b)(c)

$ 6,022,000

$

6,029,527

Golub Capital Partners CLO 35(B)

 

 

 

 

Ltd., Class 2017-35A, Class AR,

 

 

 

 

3.01% (3 mo. USD LIBOR +

 

 

 

 

1.19%), 07/20/2029(b)(c)

9,000,000

 

9,010,525

GS Mortgage Securities Trust,

 

 

 

 

Series 2012-GC6, Class AS,

 

 

 

 

4.95%, 01/10/2045(b)

2,500,000

 

2,628,947

 

Series 2015-GC30, Class A2,

 

 

 

 

2.73%, 05/10/2050

741,962

 

741,940

Hertz Vehicle Financing II L.P.,

 

 

 

 

Series 2015-1A, Class A, 2.73%,

 

 

 

 

03/25/2021(b)

7,000,000

 

7,004,735

 

Series 2015-1A, Class B, 3.52%,

 

 

 

 

03/25/2021(b)

7,260,000

 

7,267,065

 

Series 2018-1A, Class A, 3.29%,

 

 

 

 

02/25/2024(b)

3,360,000

 

3,517,881

 

Series 2019-1A, Class A, 3.71%,

 

 

 

 

03/25/2023(b)

11,000,000

 

11,487,852

 

Series 2019-2A, Class A, 3.42%,

 

 

 

 

05/25/2025(b)

6,300,000

 

6,703,797

Hilton Grand Vacations Trust,

 

 

 

 

Series 2019 AA, Class A, 2.34%,

 

 

 

 

07/25/2033(b)

4,139,066

 

4,226,928

Home Partners of America Trust,

 

 

 

 

Series 2018-1, Class A, 2.56%

 

 

 

 

(1 mo. USD LIBOR + 0.90%),

 

 

 

 

07/17/2037(b)(c)

2,348,164

 

2,345,838

 

Series 2018-1, Class B, 2.76%

 

 

 

 

(1 mo. USD LIBOR + 1.10%),

 

 

 

 

07/17/2037(b)(c)

2,970,000

 

2,951,733

 

Series 2018-1, Class C, 2.91%

 

 

 

 

(1 mo. USD LIBOR + 1.25%),

 

 

 

 

07/17/2037(b)(c)

1,350,000

 

1,341,388

Homeward Opportunities Fund I

 

 

 

 

Trust, Series 2019-1, Class A1,

 

 

 

 

3.45%, 01/25/2059(b)(f)

8,269,485

 

8,383,425

Horizon Aircraft Finance III Ltd.,

 

 

 

 

Series 2019-2, Class A, 3.43%,

 

 

 

 

11/15/2039(b)

5,107,143

 

5,156,565

ICG US CLO Ltd., Series 2016-1A,

 

 

 

 

Class A1R, 2.91% (3 mo. USD

 

 

 

 

LIBOR + 1.14%),

 

 

 

 

07/29/2028(b)(c)

3,000,000

 

2,999,430

Invitation Homes Trust,

 

 

 

 

Series 2017-SFR2, Class A,

 

 

 

 

2.51% (1 mo. USD LIBOR +

 

 

 

 

0.85%), 12/17/2036(b)(c)

2,545,661

 

2,535,850

 

Series 2017-SFR2, Class B,

 

 

 

 

2.81% (1 mo. USD LIBOR +

 

 

 

 

1.15%), 12/17/2036(b)(c)

1,441,000

 

1,440,261

 

Series 2017-SFR2, Class C,

 

 

 

 

3.11% (1 mo. USD LIBOR +

 

 

 

 

1.45%), 12/17/2036(b)(c)

2,758,000

 

2,740,309

 

Series 2017-SFR2, Class D,

 

 

 

 

3.46% (1 mo. USD LIBOR +

 

 

 

 

1.80%), 12/17/2036(b)(c)

2,101,916

 

2,094,290

Jimmy Johns Funding LLC,

 

 

 

 

Series 2017-1A, Class A2I,

 

 

 

 

3.61%, 07/30/2047(b)

9,980,227

 

10,112,229

JOL Air Ltd., Series 2019-1,

 

 

 

 

Class A, 3.97%, 04/15/2044(b)

6,154,257

 

6,335,351

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

13

Invesco Short Term Bond Fund

 

Principal

 

 

 

Amount

 

Value

Asset-Backed Securities–(continued)

 

 

JPMBB Commercial Mortgage Securities

 

 

 

Trust,

 

 

 

Series 2015-C28, Class A2,

 

 

 

2.77%, 10/15/2048

$ 1,273,469

$

1,273,161

Series 2015-C29, Class A2,

 

 

 

2.92%, 05/15/2048

704,957

 

705,430

KNDL Mortgage Trust,

 

 

 

Series 2019-KNSQ, Class A,

 

 

 

2.46% (1 mo. USD LIBOR +

 

 

 

0.80%), 05/15/2036(b)(c)

7,750,000

 

7,770,088

Series 2019-KNSQ, Class C,

 

 

 

2.71% (1 mo. USD LIBOR +

 

 

 

1.05%), 05/15/2036(b)(c)

4,250,000

 

4,253,099

Master Credit Card Trust II,

 

 

 

Series 2020-1A, Class A, 1.99%,

 

 

 

09/21/2024(b)

15,000,000

 

15,282,636

Mercedes-Benz Auto Lease Trust,

 

 

 

Series 2019-A, Class A2, 3.01%,

 

 

 

02/16/2021

2,643,321

 

2,648,465

Series 2019-A, Class A3, 3.10%,

 

 

 

11/15/2021

4,500,000

 

4,553,849

Merrill Lynch Mortgage Investors

 

 

 

Trust, Series 2005-3, Class 3A,

 

 

 

4.01% (1 mo. USD LIBOR +

 

 

 

0.25%), 11/25/2035(c)

757,014

 

763,070

Morgan Stanley Bank of America

 

 

 

Merrill Lynch Trust,

 

 

 

Series 2015-C23, Class A2,

 

 

 

2.98%, 07/15/2050

404,785

 

405,151

Morgan Stanley Capital I Trust,

 

 

 

Series 2017-CLS, Class A, 2.36%

 

 

 

(1 mo. USD LIBOR + 0.70%),

 

 

 

11/15/2034(b)(c)

8,028,000

 

8,030,384

Series 2017-CLS, Class B, 2.51%

 

 

 

(1 mo. USD LIBOR + 0.85%),

 

 

 

11/15/2034(b)(c)

3,944,000

 

3,942,784

Series 2017-CLS, Class C, 2.66%

 

 

 

(1 mo. USD LIBOR + 1.00%),

 

 

 

11/15/2034(b)(c)

2,676,000

 

2,675,181

MVW LLC, Series 2019-2A, Class A,

 

 

 

2.22%, 10/20/2038(b)

4,488,894

 

4,563,742

MVW Owner Trust,

 

 

 

Series 2013-1A, Class A, 2.15%,

 

 

 

04/22/2030(b)

3,258,575

 

3,258,751

Series 2019-1A, Class A, 2.89%,

 

 

 

11/20/2036(b)

4,156,056

 

4,322,263

Neuberger Berman CLO Ltd.,

 

 

 

Series 2017-24A, Class AR,

 

 

 

1.00% (3 mo. USD LIBOR +

 

 

 

1.02%), 04/19/2030(b)(c)

3,738,000

 

3,736,318

New Residential Mortgage Loan Trust,

 

 

 

Series 2019-NQM4, Class A1,

 

 

 

2.49%, 09/25/2059(b)(f)

3,820,442

 

3,880,202

Series 2020-NQM1, Series A1,

 

 

 

2.46%, 01/26/2060(b)(f)

5,099,469

 

5,144,904

OBX Trust, Series 2019-EXP1,

 

 

 

Class 1A3, 4.00%,

 

 

 

01/25/2059(b)(f)

2,680,662

 

2,760,819

OHA Loan Funding Ltd.,

 

 

 

Series 2016-1A, Class AR,

 

 

 

2.99% (3 mo. USD LIBOR +

 

 

 

1.26%), 01/20/2033(b)(c)

3,766,110

 

3,763,019

 

 

Principal

 

 

 

 

Amount

 

Value

 

Asset-Backed Securities–(continued)

 

 

PPM CLO 3 Ltd. (Cayman Islands),

 

 

 

 

Series 2019-3A, Class A, 3.24%

 

 

 

 

(3 mo. USD LIBOR + 1.40%),

 

 

 

 

07/17/2030(b)(c)

$ 3,874,000

$

3,881,022

 

Series 2019-3A, Class B, 3.79%

 

 

 

 

(3 mo. USD LIBOR + 1.95%),

 

 

 

 

07/17/2030(b)(c)

2,711,000

 

2,715,194

Residential Mortgage Loan Trust,

 

 

 

 

Series 2019-3, Class A1, 2.63%,

 

 

 

 

09/25/2059(b)(f)

2,198,164

 

2,215,588

 

Series 2020-1, Class A1, 2.38%,

 

 

 

 

02/25/2024(b)(f)

2,036,775

 

2,058,215

Sequoia Mortgage Trust,

 

 

 

 

Series 2013-3, Class A1, 2.00%,

 

 

 

 

03/25/2043(f)

1,744,668

 

1,704,956

 

Series 2013-4, Class A3, 1.55%,

 

 

 

 

04/25/2043(f)

1,344,970

 

1,321,933

 

Series 2013-6, Class A2, 3.00%,

 

 

 

 

05/25/2043(f)

2,390,921

 

2,463,361

 

Series 2013-7, Class A2, 3.00%,

 

 

 

 

06/25/2043(f)

1,539,393

 

1,569,881

Sierra Timeshare Receivables

 

 

 

 

Funding LLC,

 

 

 

 

Series 2016-1A, Class A, 3.08%,

 

 

 

 

03/21/2033(b)

2,742,951

 

2,765,353

 

Series 2019-3A, Class A, 2.34%,

 

 

 

 

08/20/2036(b)

6,275,325

 

6,320,449

Starwood Waypoint Homes Trust,

 

 

 

 

Series 2017-1, Class D, 3.61%

 

 

 

 

(1 mo. USD LIBOR + 1.95%),

 

 

 

 

01/17/2035(b)(c)

7,700,000

 

7,705,516

Taconic Park CLO Ltd.,

 

 

 

 

Series 2016-1A, Class A1R,

 

 

 

 

1.00% (3 mo. USD LIBOR +

 

 

 

 

1.00%), 01/20/2029(b)(c)

6,053,000

 

6,050,276

TICP CLO XV Ltd. (Cayman Islands),

 

 

 

 

Series 2020-15A, Class A,

 

 

 

 

2.89% (3 mo. USD LIBOR +

 

 

 

 

1.28%), 04/20/2033(b)(c)

3,555,000

 

3,557,335

 

Series 2020-15A, Class B,

 

 

 

 

3.31% (3 mo. USD LIBOR +

 

 

 

 

1.70%), 04/20/2033(b)(c)

1,456,000

 

1,454,323

Towd Point Mortgage Trust,

 

 

 

 

Series 2016-3, Class A1, 2.25%,

 

 

 

 

04/25/2056(b)(f)

1,116,003

 

1,125,297

 

Series 2017-2, Class A1, 2.75%,

 

 

 

 

04/25/2057(b)(f)

4,194,351

 

4,266,507

Triton Container Finance VI LLC,

 

 

 

 

Series 2018-2A, Class A, 4.19%,

 

 

 

 

06/22/2043(b)

3,363,333

 

3,401,733

Verus Securitization Trust,

 

 

 

 

Series 2017-SG1A, Class A1,

 

 

 

 

2.69%, 11/25/2047(b)(f)

3,452,761

 

3,457,940

 

Series 2018-3, Class A1, 4.11%,

 

 

 

 

10/25/2058(b)(f)

6,832,964

 

6,956,170

 

Series 2019-1, Class A1, 3.84%,

 

 

 

 

02/25/2059(b)(f)

5,498,897

 

5,588,066

 

Series 2019-2, Class A1, 3.21%,

 

 

 

 

05/25/2059(b)(f)

13,543,434

 

13,702,548

 

Series 2020-1, Class A1, 2.42%,

 

 

 

 

01/25/2060(b)(f)

6,216,577

 

6,284,708

Wells Fargo Commercial Mortgage

 

 

 

 

Trust, Series 2015-NXS1,

 

 

 

 

Class A2, 2.63%, 05/15/2048

262,605

 

262,447

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

14

Invesco Short Term Bond Fund

 

Principal

 

 

 

Amount

 

Value

Asset-Backed Securities–(continued)

 

 

Wells Fargo Re-REMIC Trust,

 

 

 

Series 2011-RR1, Class 1A,

 

 

 

4.81%, 09/17/2047(b)(f)

$ 8,041,090

$

8,184,794

Wendy's Funding LLC,

 

 

 

Series 2019-1A, Class A2I,

 

 

 

3.78%, 06/15/2049(b)

6,965,000

 

7,285,320

WFRBS Commercial Mortgage Trust,

 

 

 

IO, Series 2012-C10, Class XA,

 

 

 

1.54%, 12/15/2045(b)(f)

3,441,477

 

126,826

IO, Series 2012-C6, Class XA,

 

 

 

2.06%, 04/15/2045(b)(f)

2,057,750

 

56,657

Series 2013-C16, Class B,

 

 

 

5.03%, 09/15/2046(f)

4,500,000

 

4,947,823

Total Asset-Backed Securities

 

 

 

(Cost $447,321,697)

 

 

453,301,591

U.S. Treasury Securities–7.42%

 

 

U.S. Treasury Bills–0.08%

 

 

 

1.50% - 1.52%,

 

 

 

04/09/2020(g)(h)

1,385,000

 

1,382,723

U.S. Treasury Notes–7.34%

 

 

 

1.38%, 01/31/2022

51,518,200

 

51,981,059

1.38%, 02/15/2023

49,781,200

 

50,510,417

1.38%, 01/31/2025

15,443,200

 

15,781,623

 

 

 

118,273,099

Total U.S. Treasury Securities

 

 

 

(Cost $118,116,784)

 

 

119,655,822

Agency Credit Risk Transfer Notes–0.31%

 

 

Freddie MacSeries 2019-HQA2,

 

 

 

Class M1, STACR®, 2.33% (1 mo.

 

 

 

USD LIBOR + 0.70%),

 

 

 

04/25/2049(b)(c)

1,119,666

 

1,119,573

Freddie Mac Series 2015-HQA2,

 

 

 

Class M2. STACR®, 4.43% (1 mo.

 

 

 

USD LIBOR + 2.80%),

 

 

 

05/25/2028(c)

3,861,168

 

3,878,328

Total Agency Credit Risk Transfer Notes

 

 

(Cost $5,051,720)

 

 

4,997,901

U.S. Government Sponsored Agency Mortgage-Backed

Securities–0.21%

 

 

 

Collateralized Mortgage Obligations–0.01%

 

 

Fannie Mae REMICs, 2.11% (1 mo.

 

 

 

USD LIBOR + 0.45%),

 

 

 

02/25/2047(c)

78,584

 

78,557

Freddie Mac REMICs,

 

 

 

7.50%, 09/15/2029

88,858

 

104,102

2.66%, (1 mo. USD LIBOR +

 

 

 

1.00%), 12/15/2031(c)

24,635

 

25,301

2.61%, (1 mo. USD LIBOR +

 

 

 

0.95%), 01/15/2032(c)

14,654

 

14,809

 

 

 

222,769

Federal Home Loan Mortgage Corp. (FHLMC)–0.04%

6.00%, 03/01/2023

56,855

 

59,037

8.50%, 05/01/2024 to

 

 

 

08/17/2026

75,004

 

77,250

7.00%, 10/25/2024 to

 

 

 

10/01/2034

347,964

 

385,149

Principal

AmountValue

Federal Home Loan Mortgage Corp. (FHLMC)–(continued)

ARM,

 

 

 

 

3.50%, (6 mo. USD LIBOR +

 

 

 

 

1.62%), 07/01/2036(c)

$

27,843

$

29,032

4.58%, (1 yr. USD LIBOR +

 

 

 

 

2.07%), 02/01/2037(c)

 

8,973

 

9,612

4.08%, (1 yr. USD LIBOR +

 

 

 

 

2.01%), 01/01/2038(c)

 

7,561

 

7,978

 

 

 

 

568,058

Federal National Mortgage Association (FNMA)–0.11%

7.50%, 01/01/2021 to

 

 

 

 

02/01/2031

 

115,504

 

133,770

6.50%, 11/01/2023 to

 

 

 

 

10/01/2035

 

168,348

 

190,415

7.00%, 11/01/2025 to

 

 

 

 

08/01/2036

 

958,430

 

1,050,427

8.00%, 09/01/2026 to

 

 

 

 

07/01/2032

 

131,366

 

135,005

9.00%, 01/01/2030

 

56,220

 

62,388

8.50%, 05/01/2030 to

 

 

 

 

07/01/2030

 

133,407

 

152,163

ARM,

 

 

 

 

4.10%, (1 yr. U.S. Treasury Yield

 

 

 

 

Curve Rate + 2.22%),

 

 

 

 

11/01/2032(c)

 

19,676

 

20,790

4.36%, (1 yr. U.S. Treasury Yield

 

 

 

 

Curve Rate + 2.21%),

 

 

 

 

05/01/2035(c)

 

55,057

 

58,200

4.35%, (1 yr. USD LIBOR +

 

 

 

 

1.72%), 03/01/2038(c)

 

11,890

 

12,542

 

 

 

 

1,815,700

Government National Mortgage Association (GNMA)–0.05%

7.75%, 02/15/2021

 

4,553

 

4,565

6.50%, 07/15/2023 to

 

 

 

 

02/15/2034

 

629,476

 

698,856

7.50%, 12/20/2025

 

12,707

 

14,337

7.00%, 10/15/2026 to

 

 

 

 

06/15/2032

 

48,102

 

50,602

8.50%, 07/20/2027

 

43,932

 

49,411

 

 

 

 

817,771

Total U.S. Government Sponsored Agency

 

 

Mortgage-Backed Securities

 

 

 

 

(Cost $3,129,999)

 

 

 

3,424,298

Preferred Stocks–0.12%

 

Shares

 

 

 

 

 

 

Regional Banks–0.12%

 

 

 

 

PNC Financial Services Group, Inc. (The),

 

 

 

 

6.13%, Series P, Pfd.

 

 

 

 

(Cost $1,875,000)

 

75,000

 

1,994,250

Total Preferred Stocks (Cost $1,875,000)

 

1,994,250

Money Market Funds–2.46%

 

 

 

 

Invesco Government & Agency Portfolio,

 

 

 

 

Institutional Class, 1.50%(i)

 

13,406,487

 

13,406,487

Invesco Liquid Assets Portfolio,

 

 

 

 

Institutional Class, 1.64%(i)

 

10,876,827

 

10,882,266

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

15

Invesco Short Term Bond Fund

 

 

Shares

 

Value

Money Market Funds–(continued)

 

 

Invesco Treasury Portfolio, Institutional

 

 

 

Class, 1.48%(i)

15,321,700

$

15,321,700

Total Money Market Funds (Cost $39,609,013)

 

39,610,453

TOTAL INVESTMENTS IN SECURITIES–99.87%

 

 

(Cost $1,584,762,195)

 

 

1,609,991,797

OTHER ASSETS LESS LIABILITIES—0.13%

 

 

2,035,556

NET ASSETS–100.00%

 

$1,612,027,353

Investment Abbreviations:

 

 

 

ARM

– Adjustable Rate Mortgage

 

 

 

CLO

– Collateralized Loan Obligation

 

 

 

IO

– Interest Only

 

 

 

LIBOR

– London Interbank Offered Rate

 

 

 

Pfd.

– Preferred

 

 

 

REIT

– Real Estate Investment Trust

 

 

 

REMICs

– Real Estate Mortgage Investment Conduits

 

 

SOFR

– Secured Overnight Financing Rate

 

 

STACR® – Structured Agency Credit Risk

 

 

 

USD

– U.S. Dollar

 

 

 

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)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 February 29, 2020 was $805,542,583, which represented 49.97% of the Fund's Net Assets.

(c)Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on February 29, 2020.

(d)Perpetual bond with no specified maturity date.

(e)Step coupon bond. The interest rate represents the coupon rate at which the bond will accrue at a specified future date.

(f)Interest rate is redetermined periodically based on the cash flows generated by the pool of assets backing the security, less any applicable fees. The rate shown is the rate in effect on February 29, 2020.

(g)All or a portion of the value was pledged as collateral to cover margin requirements for open futures contracts. See Note 1I.

(h)Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund.

(i)The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of February 29, 2020.

Open Futures Contracts

 

 

 

 

 

Unrealized

Long Futures Contracts

Number of

Expiration

Notional

 

Appreciation

Contracts

Month

Value

Value

(Depreciation)

Interest Rate Risk

 

 

 

 

 

 

U.S. Treasury 2 Year Notes

2,785

June-2020

$ 608,043,831

$ 2,794,407

$ 2,794,407

 

 

 

 

 

 

 

 

Short Futures Contracts

 

 

 

 

 

 

Interest Rate Risk

 

 

 

 

 

 

U.S. Treasury 5 Year Notes

825

June-2020

(101,268,750)

(949,127)

(949,127)

 

 

 

 

 

 

 

U.S. Treasury 10 Year Notes

299

June-2020

(40,290,250)

(463,642)

(463,642)

 

 

 

 

 

 

 

Subtotal—Short Futures Contracts

 

 

 

(1,412,769)

(1,412,769)

 

 

 

 

 

 

 

Total Futures Contracts

 

 

 

$ 1,381,638

$ 1,381,638

 

 

 

 

 

 

 

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

16

Invesco Short Term Bond Fund

Statement of Assets and Liabilities

February 29, 2020

Assets:

 

Investments in securities, at value

 

(Cost $1,547,853,182)

$1,570,381,344

Investments in affiliated money market funds, at value

 

(Cost $36,909,013)

39,610,453

Other investments:

 

Variation margin receivable — futures contracts

672,615

Cash

1,839

Receivable for:

 

Fund shares sold

7,349,822

Dividends

64,341

Interest

9,302,318

Principal paydowns

174

Investment for trustee deferred compensation and

 

retirement plans

139,166

Other assets

35,025

Total assets

1,627,557,097

Liabilities:

 

Payable for:

 

Investments purchased

9,814,419

Dividends

415,250

Fund shares reacquired

4,659,238

Accrued fees to affiliates

368,757

Accrued trustees' and officers' fees and benefits

4,252

Accrued other operating expenses

114,401

Trustee deferred compensation and retirement plans

153,427

Total liabilities

15,529,744

Net assets applicable to shares outstanding

$1,612,027,353

Net assets consist of:

 

Shares of beneficial interest

$1,604,435,671

Distributable earnings

7,591,682

 

$1,612,027,353

Net Assets:

 

 

Class A

$

655,357,162

Class C

$

158,967,968

Class R

$

6,209,580

Class Y

$

146,158,808

Class R5

$

495,628

Class R6

$

644,838,207

Shares outstanding, no par value, with an unlimited number of shares authorized:

Class A

 

75,656,156

Class C

 

18,361,089

Class R

 

715,570

Class Y

 

16,868,029

Class R5

 

57,304

Class R6

 

74,345,696

Class A:

 

 

Net asset value per share

$

8.66

Maximum offering price per share

 

 

(Net asset value of $8.66 ÷ 97.50%)

$

8.88

Class C:

 

 

Net asset value and offering price per share

$

8.66

Class R:

 

 

Net asset value and offering price per share

$

8.68

Class Y:

 

 

Net asset value and offering price per share

$

8.66

Class R5:

 

 

Net asset value and offering price per share

$

8.65

Class R6:

 

 

Net asset value and offering price per share

$

8.67

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

17

Invesco Short Term Bond Fund

Statement of Operations

For the year ended February 29, 2020

Investment income:

 

 

Interest

$49,505,588

 

Dividends from affiliated money market funds

750,703

 

Dividends

114,844

 

Total investment income

50,371,135

 

Expenses:

 

 

Advisory fees

5,002,603

 

Administrative services fees

219,787

 

Custodian fees

30,407

 

Distribution fees:

 

 

Class A

914,910

 

Class C

928,242

 

Class R

29,470

 

Transfer agent fees — A, C, R and Y

1,152,051

 

Transfer agent fees — R5

252

 

Transfer agent fees — R6

25,617

 

Trustees' and officers' fees and benefits

37,862

 

Registration and filing fees

167,592

 

Reports to shareholders

107,587

 

Professional services fees

77,932

 

Other

36,825

 

Total expenses

8,731,137

 

Less: Fees waived and/or expense offset arrangement(s)

(260,949)

Net expenses

8,470,188

 

Net investment income

41,900,947

 

Realized and unrealized gain (loss) from:

 

 

Net realized gain (loss) from:

 

 

Investment securities

5,586,084

 

Futures contracts

(635,922)

 

4,950,162

 

Change in net unrealized appreciation of:

 

 

Investment securities

29,431,322

 

Futures contracts

1,219,453

 

 

30,650,775

 

Net realized and unrealized gain

35,600,937

 

Net increase in net assets resulting from operations

$77,501,884

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

18

Invesco Short Term Bond Fund

Statement of Changes in Net Assets

For the years ended February 29, 2020 and February 28, 2019

 

 

2020

 

2019

 

 

 

Operations:

 

 

 

 

 

 

 

Net investment income

$

41,900,947

$

36,167,883

 

Net realized gain (loss)

 

4,950,162

 

(8,914,678)

Change in net unrealized appreciation

 

30,650,775

 

4,037,385

 

Net increase in net assets resulting from operations

 

77,501,884

 

31,290,590

 

Distributions to shareholders from distributable earnings:

 

 

 

 

 

 

 

Class A

 

(16,160,643)

 

(11,159,392)

 

 

 

 

 

 

 

Class C

 

(3,285,936)

 

(7,048,505)

 

 

 

 

 

 

 

Class R

 

(135,343)

 

(109,232)

 

 

 

 

 

 

 

Class Y

 

(3,995,040)

 

(3,014,274)

 

 

 

 

 

 

 

Class R5

 

(26,897)

 

(50,764)

 

 

 

 

 

 

 

Class R6

 

(18,708,844)

 

(16,494,319)

 

 

 

 

 

 

 

Total distributions from distributable earnings

 

(42,312,703)

 

(37,876,486)

Return of capital:

 

 

 

 

 

 

 

Class A

 

(535,685)

 

 

Class C

 

(125,484)

 

 

Class R

 

(5,167)

 

 

Class Y

 

(125,179)

 

 

Class R5

 

(808)

 

 

Class R6

 

(561,735)

 

 

Total return of capital

 

(1,354,058)

 

 

Total distributions

 

(43,666,761)

 

Share transactions–net:

 

 

 

 

 

 

 

Class A

 

50,529,808

 

196,519,794

 

Class C

 

15,578,415

 

(249,045,046)

Class R

 

1,051,000

 

364,320

 

Class Y

 

8,664,195

 

5,814,588

 

Class R5

 

(1,300,316)

 

73,673

 

Class R6

 

66,689,262

 

(8,735,798)

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from share transactions

 

141,212,364

 

(55,008,469)

 

 

 

 

 

 

Net increase (decrease) in net assets

 

175,047,487

 

(61,594,365)

Net assets:

 

 

 

 

 

 

 

Beginning of year

 

1,436,979,866

 

1,498,574,231

 

End of year

$1,612,027,353

$

1,436,979,866

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

19

Invesco Short Term Bond Fund

Financial Highlights

The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.

 

 

 

 

 

 

 

 

 

 

 

Ratio of

Ratio of

 

 

 

 

 

 

 

 

 

 

 

 

 

expenses

expenses

 

 

 

 

 

Net gains

 

 

 

 

 

 

 

to average

to average net

 

 

 

 

 

(losses)

 

 

 

 

 

 

 

net assets

assets without

Ratio of net

 

 

Net asset

 

on securities

 

Dividends

 

 

 

 

 

with fee waivers

fee waivers

investment

 

 

value,

Net

(both

Total from

from net

 

 

Net asset

 

Net assets,

and/or

and/or

income

 

 

beginning

investment

realized and

investment

investment

Return of

Total

value, end

Total

end ofperiod

expenses

expenses

to average

Portfolio

 

ofperiod

income(a)

unrealized)

operations

income

capital

distributions

ofperiod

return (b)

(000's omitted)

absorbed

absorbed

net assets

turnover (c)

Class A

 

 

 

 

 

 

 

 

 

 

0.65%(d)

0.65%(d)

2.62%(d)

 

Year ended 02/29/20

$8.47

$0.23

$ 0.20

$ 0.43

$(0.23)

$(0.01)

$(0.24)

$8.66

5.08%

$655,357

155%

Year ended 02/28/19

8.51

0.21

(0.03)

0.18

(0.22)

(0.22)

8.47

2.19

591,443

0.64

0.65

2.52

176

Year ended 02/28/18

8.61

0.17

(0.10)

0.07

(0.17)

(0.17)

8.51

0.79

395,766

0.65

0.66

1.98

198

Year ended 02/28/17

8.47

0.14

0.15

0.29

(0.15)

(0.15)

8.61

3.39

435,592

0.65

0.66

1.59

294

Year ended 02/29/16

8.65

0.15

(0.16)

(0.01)

(0.17)

(0.17)

8.47

(0.12)

379,091

0.68

0.68

1.72

200

Class C

 

 

 

 

 

 

 

 

 

 

1.00(d)

1.15(d)

2.27(d)

155

Year ended 02/29/20

8.47

0.19

0.21

0.40

(0.20)

(0.01)

(0.21)

8.66

4.71

158,968

Year ended 02/28/19

8.51

0.18

(0.03)

0.15

(0.19)

(0.19)

8.47

1.83

140,247

0.99

1.15

2.17

176

Year ended 02/28/18

8.61

0.14

(0.10)

0.04

(0.14)

(0.14)

8.51

0.44

391,791

1.00

1.16

1.63

198

Year ended 02/28/17

8.47

0.11

0.15

0.26

(0.12)

(0.12)

8.61

3.03

451,018

1.00

1.16

1.24

294

Year ended 02/29/16

8.65

0.12

(0.16)

(0.04)

(0.14)

(0.14)

8.47

(0.47)

443,163

1.03

1.18

1.37

200

Class R

 

 

 

 

 

 

 

 

 

 

1.00(d)

1.00(d)

2.27(d)

155

Year ended 02/29/20

8.49

0.20

0.20

0.40

(0.20)

(0.01)

(0.21)

8.68

4.70

6,210

Year ended 02/28/19

8.53

0.18

(0.03)

0.15

(0.19)

(0.19)

8.49

1.84

5,035

0.99

1.00

2.17

176

Year ended 02/28/18

8.62

0.14

(0.09)

0.05

(0.14)

(0.14)

8.53

0.55

4,693

1.00

1.01

1.63

198

Year ended 02/28/17

8.49

0.11

0.14

0.25

(0.12)

(0.12)

8.62

2.90

6,466

1.00

1.01

1.24

294

Year ended 02/29/16

8.66

0.12

(0.15)

(0.03)

(0.14)

(0.14)

8.49

(0.35)

4,068

1.03

1.03

1.37

200

Class Y

 

 

 

 

 

 

 

 

 

 

0.50(d)

0.50(d)

2.77(d)

 

Year ended 02/29/20

8.48

0.24

0.19

0.43

(0.24)

(0.01)

(0.25)

8.66

5.11

146,159

155

Year ended 02/28/19

8.52

0.23

(0.03)

0.20

(0.24)

(0.24)

8.48

2.35

134,272

0.49

0.50

2.67

176

Year ended 02/28/18

8.61

0.18

(0.09)

0.09

(0.18)

(0.18)

8.52

1.06

128,874

0.50

0.51

2.13

198

Year ended 02/28/17

8.48

0.15

0.14

0.29

(0.16)

(0.16)

8.61

3.42

129,794

0.50

0.51

1.74

294

Year ended 02/29/16

8.65

0.16

(0.15)

0.01

(0.18)

(0.18)

8.48

0.15

56,237

0.53

0.53

1.87

200

Class R5

 

 

 

 

 

 

 

 

 

 

0.40(d)

0.40(d)

2.87(d)

155

Year ended 02/29/20

8.47

0.25

0.18

0.43

(0.24)

(0.01)

(0.25)

8.65

5.20

496

Year ended 02/28/19

8.51

0.23

(0.03)

0.20

(0.24)

(0.24)

8.47

2.45

1,765

0.39

0.40

2.77

176

Year ended 02/28/18

8.60

0.19

(0.09)

0.10

(0.19)

(0.19)

8.51

1.17

1,699

0.38

0.39

2.25

198

Year ended 02/28/17

8.47

0.16

0.14

0.30

(0.17)

(0.17)

8.60

3.54

1,220

0.39

0.40

1.85

294

Year ended 02/29/16

8.64

0.17

(0.15)

0.02

(0.19)

(0.19)

8.47

0.26

1,165

0.43

0.43

1.97

200

Class R6

 

 

 

 

 

 

 

 

 

 

0.37(d)

0.37(d)

2.90(d)

 

Year ended 02/29/20

8.49

0.25

0.19

0.44

(0.25)

(0.01)

(0.26)

8.67

5.23

644,838

155

Year ended 02/28/19

8.53

0.24

(0.03)

0.21

(0.25)

(0.25)

8.49

2.46

564,219

0.38

0.39

2.78

176

Year ended 02/28/18

8.62

0.19

(0.09)

0.10

(0.19)

(0.19)

8.53

1.17

575,750

0.38

0.39

2.25

198

Year ended 02/28/17

8.48

0.16

0.15

0.31

(0.17)

(0.17)

8.62

3.66

499,674

0.39

0.40

1.85

294

Year ended 02/29/16

8.66

0.17

(0.16)

0.01

(0.19)

(0.19)

8.48

0.14

63,201

0.42

0.42

1.98

200

(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 based on average daily net assets (000's omitted) of $609,940, $142,806, $5,894, $142,539, $917 and $640,438 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.

20

Invesco Short Term Bond Fund

Notes to Financial Statements

February 29, 2020

NOTE 1—Significant Accounting Policies

Invesco Short Term Bond Fund (the "Fund"), is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"). The Trust is organized as a Delaware statutory trust and is 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 total return, comprised of current income and 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, Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares are not normally subject to a CDSC. However, if Class C shares were acquired through an exchange, and the shares originally purchased were subject to a CDSC, the shares acquired as a result of the exchange will continue to be subject to that same CDSC.

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.

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.

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.

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 economic conditions, interest rates, investor perceptions 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 settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Paydown gains and losses on mortgage and asset-backed securities are recorded as adjustments to interest income. 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

21

Invesco Short Term Bond Fund

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 realized and unrealized capital gains and losses to a class based on the relative net assets of each class. The Fund allocates income to a class based on the relative value of the settled shares 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, if any, are declared daily and paid monthly. Distributions from 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.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 two parties ("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.

J.Other Risks - Active trading of portfolio securities may result in added expenses, a lower return and increased tax liability.

K.Collateral —To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund's practice to replace such collateral no later than the next business day.

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

0.350%

 

 

Next $500 million

0.325%

Next $1.5 billion

0.300%

Next $2.5 billion

0.290%

 

 

Over $5 billion

0.280%

For the year ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.32%.

22

Invesco Short Term Bond Fund

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, 2020, 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 1.40%, 1.75% (after 12b-1 fee waivers), 1.75%, 1.25%, 1.25% and 1.25%, respectively, of 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 items 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, 2020. 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, 2021, 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 year ended February 29, 2020, the Adviser waived advisory fees of $43,659.

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 year ended February 29, 2020, 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 year ended February 29, 2020, 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 0.15% of the Fund's average daily net assets of Class A shares, 0.65% 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. IDI has contractually agreed, through at least June 30, 2020, to waive 12b-1 fees for Class C shares to the extent necessary to limit 12b-1 fees to 0.50% of average daily net assets. 12b-1 fees before fee waivers under this agreement are shown as Distribution fees in the Statement of Operations. For the year ended February 29, 2020, 12b-1 fees incurred for Class C shares were $714,032 after fee waivers of $214,210.

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 year ended February 29, 2020, IDI advised the Fund that IDI retained $106,031 in front-end sales commissions from the sale of Class A shares and $92,725 and $425 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 February 29, 2020. 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

 

 

 

 

 

U.S. Dollar Denominated Bonds & Notes

$

$ 987,007,482

$—

$ 987,007,482

Asset-Backed Securities

 

453,301,591

453,301,591

U.S. Treasury Securities

 

119,655,822

119,655,822

Agency Credit Risk Transfer Notes

 

4,997,901

4,997,901

U.S. Government Sponsored Agency Mortgage-Backed Securities

 

3,424,298

3,424,298

Preferred Stocks

 

1,994,250

1,994,250

Money Market Funds

 

39,610,453

39,610,453

Total Investments in Securities

 

41,604,703

1,568,387,094

1,609,991,797

23

Invesco Short Term Bond Fund

 

 

Level 1

 

Level 2

Level 3

 

Total

Other Investments - Assets*

 

 

 

 

 

 

 

 

Futures Contracts

$

2,794,407

$

$—

$

2,794,407

 

Other Investments - Liabilities*

 

 

 

 

 

 

 

 

Futures Contracts

 

(1,412,769)

 

 

(1,412,769)

Total Other Investments

 

1,381,638

 

 

1,381,638

 

Total Investments

$

42,986,341

$1,568,387,094

$—

$1,611,373,435

 

*Unrealized appreciation (depreciation).

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 February 29, 2020:

 

 

 

Value

 

 

 

 

Interest

Derivative Assets

 

 

Rate Risk

 

Unrealized appreciation on futures contracts — Exchange-Traded(a)

$

2,794,407

 

Derivatives not subject to master netting agreements

 

 

(2,794,407)

Total Derivative Assets subject to master netting agreements

$

-

 

 

 

 

 

 

 

 

 

 

Value

 

 

 

 

Interest

Derivative Liabilities

 

 

Rate Risk

 

Unrealized depreciation on futures contracts — Exchange-Traded(a)

$

(1,412,769)

Derivatives not subject to master netting agreements

 

 

1,412,769

 

 

 

 

 

 

 

Total Derivative Liabilities subject to master netting agreements

$

-

 

 

(a)The daily variation margin receivable (payable) at period-end is recorded in the Statement of Assets and Liabilities.

Effect of Derivative Investments for the year ended February 29, 2020

The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:

 

Location of Gain (Loss) on

 

Statement of Operations

 

 

Interest

 

 

Rate Risk

Realized Gain (Loss):

 

 

Futures contracts

$

(635,922)

 

 

 

Change in Net Unrealized Appreciation:

 

 

Futures contracts

 

1,219,453

 

 

 

Total

$

583,531

The table below summarizes the average notional value of derivatives held during the period.

 

 

 

 

Futures

 

 

Contracts

Average notional value

 

$619,228,123

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 year ended February 29, 2020, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $3,080.

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

24

Invesco Short Term Bond Fund

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 may borrow for leveraging in an amount up to 5% of the Fund's total assets (excluding the amount borrowed) at the time the borrowing is made. In doing so, 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—Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 29, 2020 and February 28, 2019:

 

 

2020

2019

 

 

Ordinary income

$42,312,703

$37,876,486

 

 

 

 

 

 

Return of capital

1,354,058

 

 

 

 

 

Total distributions

$43,666,761

$37,876,486

 

 

 

 

 

 

 

Tax Components of Net Assets at Period-End:

 

 

 

 

 

 

 

2020

 

 

Net unrealized appreciation — investments

 

$ 24,858,709

 

 

 

 

 

Temporary book/tax differences

 

(129,353)

 

 

 

 

Capital loss carryforward

 

(17,137,674)

Shares of beneficial interest

 

1,604,435,671

 

 

 

 

 

Total net assets

 

$1,612,027,353

 

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to straddle contracts, futures contracts and wash sales.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund has a capital loss carryforward as of February 29, 2020, as follows:

Capital Loss Carryforward*

Expiration

Short-Term

Long-Term

Total

Not subject to expiration

$1,996,807

$15,140,867

$17,137,674

 

 

 

 

*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 9—Investment Transactions

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the year ended February 29, 2020 was $981,414,648 and $671,064,494, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $1,519,288,422 and $1,537,328,619, 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

$28,018,026

 

Aggregate unrealized (depreciation) of investments

(3,159,317)

Net unrealized appreciation of investments

$24,858,709

 

Cost of investments for tax purposes is $1,586,514,726.

NOTE 10—Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of return of capital distribution, paydowns and partnership reclasses, on February 29, 2020, undistributed net investment income was increased by $1,778,631, undistributed net realized gain (loss) was decreased by $404,152 and shares of beneficial interest was decreased by $1,374,479. This reclassification had no effect on the net assets of the Fund.

25

Invesco Short Term Bond Fund

NOTE 11—Share Information

Summary of Share Activity

 

 

Year ended

 

Year ended

 

 

February 29, 2020(a)

 

 

February 28, 2019

 

 

 

Shares

Amount

 

Shares

 

Amount

Sold:

 

 

 

 

 

 

 

 

 

 

Class A

32,376,390

$ 278,032,431

55,495,796

$

469,022,984

 

Class C

9,715,952

83,413,841

12,220,047

 

103,385,054

 

Class R

387,350

3,330,963

217,199

 

1,840,559

 

 

Class Y

13,106,059

112,222,859

13,247,995

 

112,068,635

 

Class R5

34,651

295,779

16,027

 

135,644

 

 

Class R6

17,128,603

146,435,536

11,295,823

 

95,842,910

 

Issued as reinvestment of dividends:

 

 

 

 

 

 

 

 

 

 

Class A

1,637,769

14,070,280

1,159,688

 

9,816,461

 

 

Class C

323,868

2,780,819

696,858

 

5,897,397

 

 

Class R

16,109

138,633

12,750

 

108,102

 

 

Class Y

297,910

2,559,622

211,075

 

1,786,650

 

 

Class R5

2,837

24,269

5,913

 

50,018

 

 

Class R6

2,213,330

19,039,098

1,929,521

 

16,356,711

 

Automatic conversion of Class C shares to Class A shares:

 

 

 

 

 

 

 

 

 

 

Class A

1,433,718

12,281,863

-

 

-

 

 

Class C

(1,434,559)

(12,281,863)

-

 

-

 

 

Reacquired:

 

 

 

 

 

 

 

 

 

 

Class A

(29,583,975)

(253,854,766)

(33,346,510)

 

(282,319,651)

 

 

 

 

 

 

 

Class C

(6,802,635)

(58,334,382)

(42,386,790)

 

(358,327,497)

 

 

 

 

 

 

 

Class R

(280,988)

(2,418,596)

(187,098)

 

(1,584,341)

 

 

 

 

 

 

 

Class Y

(12,376,838)

(106,118,286)

(12,752,177)

 

(108,040,697)

 

 

 

 

 

 

 

Class R5

(188,630)

(1,620,364)

(13,257)

 

(111,989)

 

 

 

 

 

 

 

Class R6

(11,488,662)

(98,785,372)

(14,268,445)

 

(120,935,419)

 

 

 

 

 

 

 

Net increase (decrease) in share activity

16,518,259

$ 141,212,364

(6,445,585)

$

(55,008,469)

 

 

 

 

 

 

 

 

 

 

 

(a)There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 62% 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.

NOTE 12—Significant Event

The Board of Trustees of the Fund unanimously approved an Agreement and Plan of Reorganization (the "Agreement") pursuant to which the Fund would transfer all of its assets and liabilities of Invesco Oppenheimer Limited-Term Bond Fund (the "Target Fund") in exchange for shares of the Fund.

The reorganization is expected to be consummated on May 15, 2020. Upon closing of the reorganization, shareholders of the Target Fund will receive shares of the Fund in exchange for their shares of the Target Fund, and the Target Fund will liquidate and cease operations.

NOTE 13—Subsequent Event

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Adviser is assessing the components of the Act, and the impacts to the Fund should be immaterial.

26

Invesco Short Term Bond Fund

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Short Term Bond Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Short Term Bond Fund (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), hereafter referred to as the "Fund") as of February 29, 2020, the related statement of operations for the year ended February 29, 2020, the statement of changes in net assets for each of the two years in the period ended February 29, 2020, including the related notes, and the financial highlights for each of the five years in the period ended February 29, 2020 (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended February 29, 2020 and the financial highlights financial highlights for each of the five years in the period ended February 29, 2020 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

Houston, Texas

April 28, 2020

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

27

Invesco Short Term Bond 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 September 1, 2019 through February 29, 2020.

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

 

(09/01/19)

(02/29/20)1

 

Period2

(02/29/20)

 

Period2

Ratio

Class A

$1,000.00

$1,018.20

 

$3.16

$1,021.73

 

$3.17

0.63%

 

 

 

 

 

 

 

 

 

Class C

1,000.00

1,016.50

 

4.91

1,019.99

 

4.92

0.98

 

 

 

 

 

 

 

 

 

Class R

1,000.00

1,016.40

 

4.91

1,019.99

 

4.92

0.98

 

 

 

 

 

 

 

 

 

Class Y

1,000.00

1,019.00

 

2.41

1,022.48

 

2.41

0.48

Class R5

1,000.00

1,019.30

 

2.21

1,022.68

 

2.21

0.44

 

 

 

 

 

 

 

 

 

Class R6

1,000.00

1,019.60

 

1.86

1,023.02

 

1.86

0.37

1The actual ending account value is based on the actual total return of the Fund for the period September 1, 2019 through February 29, 2020, 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.

2Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 182/366 to reflect the most recent fiscal half year.

28

Invesco Short Term Bond Fund

Tax Information

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 29, 2020:

Federal and State Income Tax

Qualified Dividend Income*

4.15%

Corporate Dividends Received Deduction*

4.15%

U.S. Treasury Obligations*

3.15%

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

29

Invesco Short Term Bond Fund

Trustees and Officers

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

 

Trustee

 

Number of

Other

Name, Year of Birth and

 

Funds in

Directorship(s)

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Interested Trustee

 

 

 

 

Martin L. Flanagan1 — 1960

2007

Executive Director, Chief Executive Officer and President, Invesco Ltd.

229

None

Trustee and Vice Chair

 

(ultimate parent of Invesco and a global investment management firm);

 

 

 

 

Trustee and Vice Chair, The Invesco Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board, SMU Cox School of Business

 

 

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer,

 

 

 

 

Invesco Advisers, Inc. (registered investment adviser); Director, Chairman,

 

 

 

 

Chief Executive Officer and President, Invesco Holding Company (US), Inc.

 

 

 

 

(formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service

 

 

 

 

provider) and Invesco North American Holdings, Inc. (holding company);

 

 

 

 

Director, Chief Executive Officer and President, Invesco Holding Company

 

 

 

 

Limited (parent of Invesco and a global investment management firm);

 

 

 

 

Director, Invesco Ltd.; Chairman, Investment Company Institute and President,

 

 

 

 

Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief

 

 

 

 

Financial Officer, Franklin Resources, Inc. (global investment management

 

 

 

 

organization)

 

 

1Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

T-1

Invesco Short Term Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees

 

 

 

 

Bruce L. Crockett – 1944

1992

Chairman, Crockett Technologies Associates (technology consulting company)

229

Director and

Trustee and Chair

 

Formerly: Director, Captaris (unified messaging provider); Director, President

 

Chairman of the

 

 

 

Audit Committee,

 

 

and Chief Executive Officer, COMSAT Corporation; Chairman, Board of

 

 

 

 

ALPS (Attorneys

 

 

Governors of INTELSAT (international communications company); ACE Limited

 

 

 

 

Liability

 

 

(insurance company); Independent Directors Council and Investment Company

 

 

 

 

Protection

 

 

Institute: Member of the Audit Committee, Investment Company Institute;

 

 

 

 

Society)

 

 

Member of the Executive Committee and Chair of the Governance Committee,

 

 

 

 

(insurance

 

 

Independent Directors Council

 

 

 

 

company);

 

 

 

 

 

 

 

 

Director and

 

 

 

 

Member of the

 

 

 

 

Audit Committee

 

 

 

 

and

 

 

 

 

Compensation

 

 

 

 

Committee,

 

 

 

 

Ferroglobe PLC

 

 

 

 

(metallurgical

 

 

 

 

company)

David C. Arch – 1945

2010

Chairman of Blistex Inc. (consumer health care products manufacturer);

229

Board member of

Trustee

 

Member, World Presidents' Organization

 

the Illinois

 

 

 

 

Manufacturers'

 

 

 

 

Association

Beth Ann Brown – 1968

2019

Independent Consultant

229

Director, Board of

Trustee

 

Formerly: Head of Intermediary Distribution, Managing Director, Strategic

 

Directors of

 

 

 

Caron

 

 

Relations, Managing Director, Head of National Accounts, Senior Vice

 

 

 

 

Engineering Inc.;

 

 

President, National Account Manager and Senior Vice President, Key Account

 

 

 

 

Advisor, Board of

 

 

Manager, Columbia Management Investment Advisers LLC; Vice President, Key

 

 

 

 

Advisors of Caron

 

 

Account Manager, Liberty Funds Distributor, Inc.; and Trustee of certain

 

 

 

 

Engineering Inc.;

 

 

Oppenheimer Funds

 

 

 

 

President and

 

 

 

 

 

 

 

 

Director, Acton

 

 

 

 

Shapleigh Youth

 

 

 

 

Conservation

 

 

 

 

Corps (non -

 

 

 

 

profit); and Vice

 

 

 

 

President and

 

 

 

 

Director of

 

 

 

 

Grahamtastic

 

 

 

 

Connection (non-

 

 

 

 

profit)

Jack M. Fields – 1952

1997

Chief Executive Officer, Twenty First Century Group, Inc. (government affairs

229

Member, Board of Directors of

Trustee

 

company); and Chairman, Discovery Learning Alliance (non-profit)

 

Baylor College of Medicine

 

 

Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle,

 

 

 

 

hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as

 

 

 

 

Administaff) (human resources provider); Chief Executive Officer, Texana

 

 

 

 

Timber LP (sustainable forestry company); Director of Cross Timbers Quail

 

 

 

 

Research Ranch (non-profit); and member of the U.S. House of Representatives

 

 

 

 

 

 

 

T-2

Invesco Short Term Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Cynthia Hostetler —1962

2017

Non-Executive Director and Trustee of a number of public and private business

229

Vulcan Materials

Trustee

 

corporations

 

Company

 

 

Formerly: Director, Aberdeen Investment Funds (4 portfolios); Head of

 

(construction

 

 

 

materials

 

 

Investment Funds and Private Equity, Overseas Private Investment

 

 

 

 

company); Trilinc

 

 

Corporation; President, First Manhattan Bancorporation, Inc.; Attorney,

 

 

 

 

Global Impact

 

 

Simpson Thacher & Bartlett LLP

 

 

 

 

Fund; Genesee &

 

 

 

 

 

 

 

 

Wyoming, Inc.

 

 

 

 

(railroads); Artio

 

 

 

 

Global Investment

 

 

 

 

LLC (mutual fund

 

 

 

 

complex); Edgen

 

 

 

 

Group, Inc.

 

 

 

 

(specialized

 

 

 

 

energy and

 

 

 

 

infrastructure

 

 

 

 

products

 

 

 

 

distributor);

 

 

 

 

Investment

 

 

 

 

Company Institute

 

 

 

 

(professional

 

 

 

 

organization);

 

 

 

 

Independent

 

 

 

 

Directors Council

 

 

 

 

(professional

 

 

 

 

organization)

Eli Jones – 1961

2016

Professor and Dean, Mays Business School - Texas A&M University

229

Insperity, Inc.

Trustee

 

Formerly: Professor and Dean, Walton College of Business, University of

 

(formerly known

 

 

 

as Administaff)

 

 

Arkansas and E.J. Ourso College of Business, Louisiana State University;

 

 

 

 

(human resources

 

 

Director, Arvest Bank

 

 

 

 

provider)

 

 

 

 

Elizabeth Krentzman – 1959

2019

Formerly: Principal and Chief Regulatory Advisor for Asset Management

229

Trustee of the

Trustee

 

Services and U.S. Mutual Fund Leader of Deloitte & Touche LLP; General

 

University of

 

 

Counsel of the Investment Company Institute (trade association); National

 

Florida National

 

 

Director of the Investment Management Regulatory Consulting Practice,

 

Board Foundation

 

 

Principal, Director and Senior Manager of Deloitte & Touche LLP; Assistant

 

and Audit

 

 

Director of the Division of Investment Management - Office of Disclosure and

 

Committee

 

 

Investment Adviser Regulation of the U.S. Securities and Exchange

 

Member; Member

 

 

Commission and various positions with the Division of Investment Management

 

of the Cartica

 

 

– Office of Regulatory Policy of the U.S. Securities and Exchange Commission;

 

Funds Board of

 

 

Associate at Ropes & Gray LLP; Advisory Board Member of the Securities and

 

Directors (private

 

 

Exchange Commission Historical Society; and Trustee of certain Oppenheimer

 

investment

 

 

Funds

 

funds); Member

 

 

 

 

of the University

 

 

 

 

of Florida Law

 

 

 

 

Center

 

 

 

 

Association, Inc.

 

 

 

 

Board of Trustees

 

 

 

 

and Audit

 

 

 

 

Committee

 

 

 

 

Member

Anthony J. LaCava, Jr. – 1956

2019

Formerly: Director and Member of the Audit Committee, Blue Hills Bank

229

Blue Hills Bank;

Trustee

 

(publicly traded financial institution) and Managing Partner, KPMG LLP

 

Chairman,

 

 

 

 

Bentley

 

 

 

 

University;

 

 

 

 

Member,

 

 

 

 

Business School

 

 

 

 

Advisory Council;

 

 

 

 

and Nominating

 

 

 

 

Committee

 

 

 

 

KPMG LLP

Prema Mathai-Davis – 1950

1998

Retired

229

None

Trustee

 

Co-Owner & Partner of Quantalytics Research, LLC, (a FinTech Investment

 

 

 

 

 

 

Research Platform for the Self-Directed Investor)

T-3

Invesco Short Term Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

 

 

 

 

Funds

Other

 

Trustee

 

in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Independent Trustees—(continued)

 

 

 

Joel W. Motley – 1952

2019

Director of Office of Finance, Federal Home Loan Bank System; Member of the

229

Member of Board

Trustee

 

Vestry of Trinity Wall Street; Managing Director of Carmona Motley Inc.

 

of Greenwall

 

 

(privately held financial advisor); Member of the Council on Foreign Relations

 

Foundation

 

 

and its Finance and Budget Committee; Chairman Emeritus of Board of Human

 

(bioethics research

 

 

Rights Watch and Member of its Investment Committee; and Member of

 

foundation) and

 

 

Investment Committee and Board of Historic Hudson Valley (non-profit cultural

 

its Investment

 

 

organization)

 

Committee;

 

 

Formerly: Managing Director of Public Capital Advisors, LLC (privately held

 

Member of Board of

 

 

 

Friends of the LRC

 

 

financial advisor); Managing Director of Carmona Motley Hoffman, Inc.

 

 

 

 

(non-profit

 

 

(privately held financial advisor); Trustee of certain Oppenheimer Funds; and

 

 

 

 

legal advocacy);

 

 

Director of Columbia Equity Financial Corp. (privately held financial advisor)

 

 

 

 

Board Member

 

 

 

 

 

 

 

 

and Investment

 

 

 

 

Committee

 

 

 

 

Member of

 

 

 

 

Pulizer Center for

 

 

 

 

Crisis Reporting

 

 

 

 

(non-profit

 

 

 

 

journalism)

Teresa M. Ressel — 1962

2017

Non-executive director and trustee of a number of public and private business

229

Atlantic Power

Trustee

 

corporations

 

Corporation

 

 

Formerly: Chief Financial Officer, Olayan America, The Olayan Group

 

(power generation

 

 

 

company); ON

 

 

(international investor/commercial/industrial); Chief Executive Officer, UBS

 

 

 

 

Semiconductor

 

 

Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant

 

 

 

 

Corp.

 

 

Secretary for Management & Budget and CFO, US Department of the Treasury

 

 

 

 

(semiconductor

 

 

 

 

 

 

 

 

supplier)

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston Endowment Inc. (private

229

Federal Reserve

Trustee

 

philanthropic institution)

 

Bank of Dallas

 

 

Formerly: Executive Vice President and General Counsel, Texas Children's

 

 

 

 

Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor,

 

 

 

 

University of St. Thomas; Attorney, Andrews & Kurth LLP

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of Denver – Daniels College of

 

 

 

 

 

 

 

 

Business; Senior Partner, KPMG LLP

 

 

 

 

 

 

 

Daniel S. Vandivort –1954

2019

Treasurer, Chairman of the Audit and Finance Committee, and Trustee, Board

229

Chairman and

Trustee

 

of Trustees, Huntington Disease Foundation of America; and President, Flyway

 

Lead Independent

 

 

Advisory Services LLC (consulting and property management)

 

Director,

 

 

Formerly: Trustee and Governance Chair, of certain Oppenheimer Funds

 

Chairman of the

 

 

 

Audit Committee,

 

 

 

 

 

 

 

 

and Director,

 

 

 

 

Board of

 

 

 

 

Directors, Value

 

 

 

 

Line Funds

James D. Vaughn – 1945

2019

Retired

229

Board member

Trustee

 

Formerly: Managing Partner, Deloitte & Touche LLP; Trustee and Chairman of

 

and Chairman of

 

 

 

Audit Committee

 

 

the Audit Committee, Schroder Funds; Board Member, Mile High United Way,

 

 

 

 

of AMG National

 

 

Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts,

 

 

 

 

Trust Bank;

 

 

Economic Club of Colorado and Metro Denver Network (economic development

 

 

 

 

Trustee and

 

 

corporation); and Trustee of certain Oppenheimer Funds

 

 

 

 

Investment

 

 

 

 

 

 

 

 

Committee

 

 

 

 

member,

 

 

 

 

University of

 

 

 

 

South Dakota

 

 

 

 

Foundation;

 

 

 

 

Board member,

 

 

 

 

Audit Committee

 

 

 

 

Member and past

 

 

 

 

Board Chair,

 

 

 

 

Junior

 

 

 

 

Achievement

 

 

 

 

(non-profit)

Christopher L. Wilson -

2017

Retired

229

ISO New

1957

 

Formerly: Director, TD Asset Management USA Inc. (mutual fund complex) (22

 

England, Inc.

Trustee, Vice Chair and Chair

 

 

(non-profit

 

portfolios); Managing Partner, CT2, LLC (investing and consulting firm);

 

Designate

 

 

organization

 

President/Chief Executive Officer, Columbia Funds, Bank of America

 

 

 

 

 

Corporation; President/Chief Executive Officer, CDC IXIS Asset Management

managing

regional electricity

Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder,

market)

Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments

 

T-4

Invesco Short Term Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers

 

 

 

 

Sheri Morris — 1964

1999

Head of Global Fund Services, Invesco Ltd.; President, Principal Executive

N/A

N/A

President, Principal Executive

 

Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers,

 

 

Officer and Treasurer

 

Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; and Vice President,

 

 

 

 

OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal Financial Officer, The Invesco Funds;

 

 

 

 

Vice President, Invesco AIM Advisers, Inc., Invesco AIM Capital Management,

 

 

 

 

Inc. and Invesco AIM Private Asset Management, Inc.; Assistant Vice President

 

 

 

 

and Assistant Treasurer, The Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital Management, Inc. and Invesco AIM

 

 

 

 

Private Asset Management, Inc.; and Treasurer, Invesco Exchange-Traded

 

 

 

 

Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded

 

 

 

 

Fund Trust

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The Invesco Funds

N/A

N/A

Senior Vice President and Senior

 

 

 

 

Officer

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco Ltd.; Senior Vice President and

N/A

N/A

Senior Vice President, Chief Legal

 

Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional

 

 

Officer and Secretary

 

(N.A.), Inc.) (registered investment adviser); Senior Vice President and

 

 

 

 

Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM

 

 

 

 

Distributors, Inc.); Vice President and Secretary, Invesco Investment Services,

 

 

 

 

Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice

 

 

 

 

President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers LLC (formerly known as Van

 

 

 

 

Kampen Asset Management); Secretary and General Counsel, Invesco Capital

 

 

 

 

Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund

 

 

 

 

Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L. Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President, Jemstep, Inc.; Head of Legal,

 

 

 

 

Worldwide Institutional, Invesco Ltd.; Secretary and General Counsel, INVESCO

 

 

 

 

Private Capital Investments, Inc.; Senior Vice President, Secretary and General

 

 

 

 

Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM

 

 

 

 

Management Group, Inc.); Assistant Secretary, INVESCO Asset Management

 

 

 

 

(Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and

 

 

 

 

General Counsel, Invesco Senior Secured Management, Inc.; and Secretary,

 

 

 

 

Sovereign G./P. Holdings Inc.

 

 

Andrew R. Schlossberg – 1974

2019

Head of the Americas and Senior Managing Director, Invesco Ltd.; Director and

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc. (formerly known as Invesco AIM

 

 

 

 

Investment Services, Inc.) (registered transfer agent); Senior Vice President,

 

 

 

 

The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known

 

 

 

 

as Van Kampen Asset Management); Director, President and Chairman, Invesco

 

 

 

 

Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited; Director and Chief Executive, Invesco

 

 

 

 

Asset Management Limited and Invesco Fund Managers Limited; Assistant Vice

 

 

 

 

President, The Invesco Funds; Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional (N.A.), Inc.) (registered investment

 

 

 

 

adviser); Director and Chief Executive, Invesco Administration Services Limited

 

 

 

 

and Invesco Global Investment Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco India Exchange-Traded Fund Trust;

 

 

 

 

Managing Director and Principal Executive Officer, Invesco Capital

 

 

 

 

Management LLC

 

 

T-5

Invesco Short Term Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas; Senior Vice President, Invesco

N/A

N/A

Senior Vice President

 

Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly

 

 

 

 

known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director,

 

 

 

 

Invesco Capital Management LLC; Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset Management); Senior Vice President,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.);

 

 

 

 

Manager, Invesco Indexing LLC; Manager, Invesco Specialized Products, LLC;

 

 

 

 

Director and Senior Vice President, Invesco Insurance Agency, Inc.; Member,

 

 

 

 

Invesco Canada Funds Advisory Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate mutual fund company); and

 

 

 

 

Director, Chairman, President and Chief Executive Officer, Invesco Canada Ltd.

 

 

 

 

(formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered

 

 

 

 

investment adviser and registered transfer agent); President, Invesco, Inc.

 

 

 

 

Formerly: Director and Senior Vice President, Invesco Management Group, Inc.

 

 

 

 

(formerly known as Invesco AIM Management Group, Inc.); Secretary and

 

 

 

 

General Counsel, Invesco Management Group, Inc. (formerly known as Invesco

 

 

 

 

AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer

 

 

 

 

and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco

 

 

 

 

Investment Advisers LLC (formerly known as Van Kampen Asset Management);

 

 

 

 

Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal Officer, Invesco Exchange-Traded Fund

 

 

 

 

Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC;

 

 

 

 

Director, Secretary, General Counsel and Senior Vice President, Van Kampen

 

 

 

 

Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc.

 

 

 

 

(formerly known as INVESCO Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen

 

 

 

 

Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van

 

 

 

 

Kampen Investor Services Inc.;Director and Secretary, Invesco Distributors,

 

 

 

 

Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice

 

 

 

 

President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van

 

 

 

 

Kampen Investments Inc.; Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice President, Secretary, General

 

 

 

 

Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief

 

 

 

 

Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and

N/A

N/A

Senior Vice President

 

Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco

 

 

 

 

Institutional (N.A.), Inc.) (registered investment adviser); Director, Invesco

 

 

 

 

Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and

 

 

 

 

Senior Vice President, The Invesco Funds; and President, SNW Asset

 

 

 

 

Management Corporation and Invesco Managed Accounts, LLC

 

 

 

 

Formerly: Senior Vice President, Invesco Management Group, Inc. and Invesco

 

 

 

 

Advisers, Inc.; Assistant Vice President, The Invesco Funds

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer – Investments Pool, Invesco

N/A

N/A

Vice President, Principal Financial

 

Specialized Products, LLC; Vice President, Principal Financial Officer and

 

 

Officer and Assistant Treasurer

 

Assistant Treasurer, The Invesco Funds; Principal Financial and Accounting

 

 

 

 

Officer – Pooled Investments, Invesco Capital Management LLC; Vice President

 

 

 

 

and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Vice President, Invesco Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco Specialized Products, LLC; Assistant

 

 

 

 

Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded

 

 

 

 

Self-Indexed Fund Trust; Assistant Treasurer, Invesco Capital

 

 

 

 

Management LLC; Assistant Vice President, The Invesco Funds

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance Officer for Invesco U.S. entities

N/A

N/A

Anti-Money Laundering

 

including: Invesco Advisers, Inc. and its affiliates, Invesco Capital Markets,

 

 

Compliance Officer

 

Inc., Invesco Distributors, Inc., Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC, Invesco Trust Company;

 

 

 

 

OppenheimerFunds Distributor, Inc., and Fraud Prevention Manager for

 

 

 

 

Invesco Investment Services, Inc.

 

 

T-6

Invesco Short Term Bond Fund

Trustees and Officers—(continued)

 

 

 

Number of

Other

 

Trustee

 

Funds in

Directorship(s)

Name, Year of Birth and

and/or

 

Fund Complex

Held by Trustee

Position(s)

Officer

Principal Occupation(s)

Overseen by

During Past 5

Held with the Trust

Since

During Past 5 Years

Trustee

Years

Officers—(continued)

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers, Inc. (registered investment

N/A

N/A

Chief Compliance Officer

 

adviser); and Chief Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam Investments and the Putnam

 

 

 

 

Funds

 

 

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza, Suite 1000

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers LLP

Houston, TX 77046-1173

1555 Peachtree Street, N.E.

11 Greenway Plaza, Suite 1000

1000 Louisiana Street, Suite 5800

 

Atlanta, GA 30309

Houston, TX 77046-1173

Houston, TX 77002-5678

Counsel to the Fund

Counsel to the Independent Trustees

Transfer Agent

Custodian

Stradley Ronon Stevens & Young, LLP

Goodwin Procter LLP

Invesco Investment Services, Inc.

State Street Bank and Trust Company

2005 Market Street, Suite 2600

901 New York Avenue, N.W.

11 Greenway Plaza, Suite 1000

225 Franklin Street

Philadelphia, PA 19103-7018

Washington, D.C. 20001

Houston, TX 77046-1173

Boston, MA 02110-2801

T-7

Invesco Short Term Bond Fund

(This page intentionally left blank)

(This page intentionally left blank)

(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 holdings four times in each fiscal year, at the quarter-ends. For the second and fourth quarters, the list appears in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 secu- rities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ proxyguidelines. 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: 811-05686 and 033-39519

Invesco Distributors, Inc.

STB-AR-1

Shareholder Report for the

Nine Months Ended 2/29/2020

Invesco

High Yield Bond Factor Fund*

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco. com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 800 959 4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

*Prior to the close of business on February 28, 2020, the Fund's name was Invesco Oppenheimer Global High Yield Fund and prior to the close of business on May 24, 2019, the Fund's name was Oppenheimer Global High Yield Fund. See Important Update on the following page for more information.

Important Update

On October 18, 2018, Massachusetts Mutual Life Insurance Company, an indirect corporate parent of OppenheimerFunds, Inc. and its subsidiaries OFI Global Asset Management, Inc., OFI SteelPath, Inc. and OFI Advisors, LLC, announced that it had entered into an agreement whereby Invesco Ltd., a global investment management company would acquire OppenheimerFunds and its subsidiaries (together, "OppenheimerFunds"). After the close of business on May 24, 2019 Invesco Ltd. completed the acquisition of OppenheimerFunds. This Fund was included in that acquisition and as of that date, became part of the Invesco family of funds. Please visit invesco.com for more information or call Invesco's Client Services team at 800-959-4246.

Table of Contents

 

Fund Performance Discussion

5

Top Holdings and Allocations

8

Fund Expenses

12

Consolidated Schedule of Investments

14

Consolidated Statement of Assets and Liabilities

27

Consolidated Statement of Operations

29

Consolidated Statement of Changes in Net Assets

31

Consolidated Financial Highlights

32

Notes to Consolidated Financial Statements

44

Report of Independent Registered Public Accounting Firm

66

Tax Information

68

Portfolio Proxy Voting Policies and Guidelines; Updates to

 

Schedule of Investments

69

Trustees and Officers

70

Invesco Privacy Notice

82

Class A Shares

AVERAGE ANNUAL TOTAL RETURNS AT 2/29/20

 

 

 

 

 

 

 

Class A Shares of the Fund

Bloomberg Barclays

 

 

 

 

 

 

Without Sales Charge

With Sales Charge

U.S. Corporate High

JPMorgan Global High

 

Yield 2% Issuer

Yield Index

 

 

 

 

 

 

Capped Index1

 

1-Year

5.11%

0.64%

6.10%

6.42%

5-Year

3.59

2.70

5.20

5.60

Since

 

 

 

 

Inception

3.45

2.74

5.23

5.38

(11/8/13)

1.Effective February 28, 2020, the Fund changed its benchmark index from the JPMorgan Global High Yield Index to the Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Capped Index. These changes were made in connection with repositioning the Fund as a factor-based high yield bond fund.

Performance quoted is past performance and cannot guarantee future results; current performance may be lower or higher. Visit invesco.com for the most recent month-end performance. Performance figures reflect reinvested distributions and changes in net asset value (NAV). Investment return and principal value will vary so that you may have a gain or a loss when you sell shares. Fund returns include changes in share price, reinvested distributions and a 4.25% maximum applicable sales charge except where "without sales charge" is indicated. Returns for periods of less than one year are cumulative and not annualized. As the result of a

3 INVESCO HIGH YIELD BOND FACTOR FUND

reorganization after the close of business on May 24, 2019, the returns of the Fund for periods on or prior to May 24, 2019 reflect performance of the Oppenheimer predecessor fund. Share class returns will differ from those of the predecessor fund because they have different expenses. Returns do not consider capital gains or income taxes on an individual's investment. See Fund prospectus and summary prospectus for more information on share classes, sales charges and new fee agreements, if any. Fund literature is available at invesco.com.

4 INVESCO HIGH YIELD BOND FACTOR FUND

Fund Performance Discussion

For the fiscal year ended February 29, 2020, high yield bond returns were positive. The fiscal year

began with heightened volatility as investors feared that the US Federal Reserve (the Fed) had gone too far in its monetary policy tightening and that the effects would lead to a synchronized global economic growth slowdown. That uncertainty was quickly alleviated when the Fed changed its course and all but promised no rate hikes in 2019. The renewed risk appetite was further inspired by dovish central banks globally.

This expansionary monetary policy trend continued throughout the fiscal year until February 2020, when investors began to fear that the spread of the COVID-19 virus would lead to a global economic slowdown. Despite the uptick in volatility late in the fiscal year, defaults continued to stay below the long- term average of about 2.91%.1 In particular, the par-weighted high yield default rate

ended the fiscal year at 2.30%.1

The Fed cut interest rates three times during the fiscal year to a range of 1.50% to 1.75% as of October 31, 2019, as well as at the end of the fiscal year.2 The European Central Bank also cuts rates at the end of 2019 at -0.5%.3 This, coupled with easier fiscal and monetary

COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:

Invesco High Yield Bond Factor Fund (Class A shares with sales charge) Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Capped Index* JPMorgan Global High Yield Index

$15,000

10,000

5,000

$13,922 $13,794

$11,861

0

 

 

 

 

 

 

 

 

 

 

 

|

|

|

|

|

|

|

 

 

|

 

11/8/13

2/28/14

2/28/15

2/29/16

2/28/17

2/28/18

2/28/19

2/29/20

*Effective February 28, 2020, the Fund changed its benchmark index from the JPMorgan Global High Yield Index to the Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Capped Index. These changes were made in connection with repositioning the Fund as a factor-based high yield bond fund.

5 INVESCO HIGH YIELD BOND FACTOR FUND

policy in China and the continued economic woes plaguing the European Union, drove interest rates lower across maturities.

Against this backdrop, the high yield market produced positive monthly returns in ten of the 12 months of the fiscal year. By quality, BB-rated bonds led the way during the fiscal year. By sector, housing and automotive had the strongest returns, while the energy sector had the weakest performance for the fiscal year.

During the fiscal year, the Fund benefited from its positioning in banking and paper sub- industries. The Fund's underweight allocation to energy was also beneficial to relative to the Fund's index performance during the fiscal year.

The largest detractors from the Fund's performance during the fiscal year were positions in technology and media and entertainment. Moreover, security selection in pharmaceuticals was a minor drag on relative to the Fund's index performance.

At the close of the fiscal year, despite the uptick in volatility experienced during this time, we believed solid company fundamentals and low defaults could provide a solid foundation for 2020. We note recent macroeconomic events, namely the coronavirus and the oil price war initiated by Saudi Arabia and Russia, have caused

a material widening in credit spreads. It is unclear when both issues will be resolved, but it is our view that they will both have

a negative effect on second-quarter gross domestic product. That said, we also firmly believe that central banks will provide liquidity in an effort to avoid stressed financial conditions in a macroeconomic environment where company level revenues may suffer

a short-term negative impact. In terms of new issue supply, many companies have already accessed the market to refinance, thereby pushing out maturities. We believe there may be an increase in default activity in challenged sectors like energy, but we also recognize many of the companies have attractive hedges in place through year end 2020, thereby providing good visibility into near term revenues. We expect continued challenges in the wireline and retail industries as fundamental challenges threaten many companies in each sector. Given current uncertainties surrounding company level revenues, we are likely to see companies focus on preserving the strength of their balance sheets, as opposed to deliberately adding new debt. While we remain cautious, it is our opinion that the recent credit spread widening will create investment opportunities that we have not seen during the last few months of the fiscal year.

On February 28, 2020, the Invesco Oppenheimer Global High Yield Fund was repositioned. The Fund was renamed the Invesco High Yield Bond Factor Fund with an investment goal to seek a total return by targeting securities with characteristics that research suggests will have higher returns over a market cycle while using a factor- based strategy. In practice, this means the

6 INVESCO HIGH YIELD BOND FACTOR FUND

Fund will have higher allocation than its benchmark to value bonds (bonds that have higher spreads relative to other securities of similar credit quality and sector); low volatility bonds (bonds that have lower levels of price volatility); and high carry bonds (bonds with higher spreads relative to the broad market). The Fund will invest primarily in high-yield, below-investment grade, fixed-income securities (also referred to as "junk" bonds).

1. Source: JP Morgan

2. Source: US Federal Reserve

3. Source: European Central Bank

Portfolio Managers: Jay Raol, James Ong, Noelle Corum and Sash Sarangi

7 INVESCO HIGH YIELD BOND FACTOR FUND

Top Holdings and Allocations

PORTFOLIO ALLOCATION

Non-Convertible Corporate Bonds

89.8%

and Notes

Investment Companies

7.5

Foreign Government Obligations

1.8

Asset-Backed Securities

0.8

Corporate Loans

0.1

Common Stocks

*

Preferred Stocks

*

* Represents a value of less than 0.05%.

Portfolio holdings and allocations are subject to change. Percentages are as of February 29, 2020, and are based on the total market value of investments.

For more current Fund holdings, please visit invesco.com.

TOP TEN GEOGRAPHICAL HOLDINGS

United States

57.9%

Brazil

6.0

Mexico

5.7

Canada

4.4

Netherlands

2.5

Ukraine

2.2

Ireland

2.0

China

1.7

Luxembourg

1.6

Portugal

1.5

Portfolio holdings and allocations are subject to change. Percentages are as of February 29, 2020, and are based on total market value of investments.

8 INVESCO HIGH YIELD BOND FACTOR FUND

REGIONAL ALLOCATION

U.S./Canada

62.3%

Latin & South America

14.0

Europe

12.1

Asia/Pacific

5.3

Middle East/Africa

4.1

Emerging Europe

2.2

Portfolio holdings and allocation are subject to change. Percentages are as of February 29, 2020, and are based on total market value of investments.

 

NRSRO

 

ONLY

CREDIT RATING BREAKDOWN

TOTAL

BBB

4.9%

BB

37.8

B

42.4

CCC

10.8

CC

0.1

D

0.4

Unrated

3.6

Total

100.0%

The percentages above are based on the market value of the Fund's securities as of February 29, 2020 and are subject to change. Except for securities labeled "Unrated," all securities have been rated by at least one Nationally Recognized Statistical Rating Organization ("NRSRO"), such as Standard & Poor's ("S&P"). For securities rated only by an NRSRO other than S&P, Invesco Advisers, Inc. (the "Adviser") converts that rating to the equivalent S&P rating. If two or more NRSROs have assigned a rating to a security, the highest S&P equivalent rating is used. For securities not rated by an NRSRO, the Adviser uses its own credit analysis to assign ratings in categories similar to those of S&P. The use of similar categories is not an indication that the Adviser's credit analysis process is consistent or comparable with any NRSRO's process were that NRSRO to rate the same security. Fund assets invested in Invesco Government & Agency Portfolio are assigned that fund's S&P rating, which is currently AAA. For the purposes of this table, "investment-grade" securities are securities rated within the NRSROs' four highest rating categories (AAA, AA, A and BBB). Unrated securities do not necessarily indicate low credit quality and may or may not be the equivalent of investment-grade. Please consult the Fund's prospectus and Statement of Additional Information for further information.

9 INVESCO HIGH YIELD BOND FACTOR FUND

Share Class Performance

AVERAGE ANNUAL TOTAL RETURNS WITHOUT SALES CHARGE AS OF 2/29/20

 

 

Inception

 

 

Since

 

 

Date

1-Year

5-Year

Inception

Class A (OGYAX)

11/8/13

5.11%

3.59%

3.45%

Class C (OGYCX)

11/8/13

4.26

2.85

2.72

Class R (OGYNX)

11/8/13

4.85

3.34

3.20

Class Y (OGYYX)

11/8/13

5.42

3.90

3.76

Class R5

(GBHYX)1

5/24/19

5.29

3.62

3.47

Class R6

(OGYIX)2

11/8/13

5.35

3.95

3.80

AVERAGE ANNUAL TOTAL RETURNS WITH SALES CHARGE AS OF 2/29/20

 

 

 

 

 

 

 

 

Inception

 

 

Since

 

 

Date

1-Year

5-Year

Inception

Class A (OGYAX)

11/8/13

0.64%

2.70%

2.74%

Class C (OGYCX)

11/8/13

3.26

2.85

2.72

Class R (OGYNX)

11/8/13

4.85

3.34

3.20

Class Y (OGYYX)

11/8/13

5.42

3.90

3.76

Class R5

(GBHYX)1

5/24/19

5.29

3.62

3.47

Class R6

(OGYIX)2

11/8/13

5.35

3.95

3.80

1.Class R5 shares' performance shown prior to the inception date is that of the predecessor fund's Class A shares at net asset value (NAV) and includes the 12b-1 fees applicable to Class A shares. Class A shares' performance reflects any applicable fee waivers and/or expense reimbursements.

2.Pursuant to the closing of the transaction described in the Notes to Consolidated Financial Statements, after the close of business on May 24, 2019, Class I shares were reorganized as Class R6 shares.

Performance quoted is past performance and cannot guarantee future results; current performance may be lower or higher. Visit invesco.com for the most recent month-end performance. Performance figures reflect reinvested distributions and changes in net asset value (NAV). Investment return and principal value will vary so that you may have a gain or a loss when you sell shares. Performance shown at NAV does not include the applicable front-end sales charge, which would have reduced the performance. The current maximum initial sales charge for Class A shares is 4.25%, and the contingent deferred sales charge for Class C shares is 1% for the 1-year period. Class R, Class Y, Class R5 and Class R6 shares have no sales charge; therefore, performance is at NAV. Effective after the close of business on May 24, 2019, Class A, Class C, Class I, Class R and Class Y shares of the predecessor fund were reorganized into Class A, Class C, Class R6, Class R and Class Y respectively, of the Fund. Class R5 shares' performance shown prior to the inception date is that of the predecessor fund's Class A shares at NAV and includes the 12b-1 fees applicable to Class A shares. Class A shares' performance reflects any applicable fee waivers and/or expense reimbursements. Returns shown for Class A, Class C, Class R, Class Y, Class R5, and Class R6 shares are blended returns of the predecessor fund and the Fund. Share class returns will differ from those of the predecessor fund because of different expenses. See Fund prospectuses and summary prospectuses for more information on share classes, sales charges and new fee agreements, if any. Fund literature is available at invesco.com.

10 INVESCO HIGH YIELD BOND FACTOR FUND

The Fund's performance is compared to the performance of the JPMorgan Global High Yield Index, which is designed to mirror the investable universe of the U.S. dollar global high yield corporate debt market, including domestic and international issues. Effective February 28, 2020, the Fund's new index is the Bloomberg Barclays benchmark because it more closely reflects the performance of the types of securities in which the Fund invests following its repositioning as a factor-based high yield bond fund. The Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Capped Index is an unmanaged index representative of the US high- yield, fixed-rate corporate bond market. Index weights for each issuer are capped at 2%. The Index is unmanaged and cannot be purchased directly by investors. While index comparisons may be useful to provide a benchmark for the Fund's performance, it must be noted that the Fund's investments are not limited to the investments comprising the Index. Index performance includes reinvestment of income, but does not reflect transaction costs, fees, expenses or taxes. Index performance is shown for illustrative purposes only as a benchmark for the Fund's performance and does not predict or depict performance of the Fund. The Fund's performance reflects the effects of the Fund's business and operating expenses.

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

Before investing, investors should carefully read the prospectus and/or summary prospectus and carefully consider the investment objectives, risks, charges and expenses. For this and more complete information about the fund(s), investors should ask their advisors for a prospectus/summary prospectus or visit invesco. com/fundprospectus.

Shares of Invesco funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

11 INVESCO HIGH YIELD BOND FACTOR FUND

Fund Expenses

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments and/or contingent deferred sales charges on redemptions; and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended February 29, 2020.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled "Expenses Paid During 6 Months Ended February 29, 2020" to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class 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 for the class of shares you hold 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 transactional costs, such as front-end or contingent deferred sales charges (loads). Therefore, the "hypothetical" section of the table 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 transactional costs were included, your costs would have been higher.

12 INVESCO HIGH YIELD BOND FACTOR FUND

 

Beginning

Ending

Expenses

 

Account

Account

Paid During

 

Value

Value

6 Months Ended

Actual

September 1, 2019

February 29, 2020

February 29, 2020

Class A

$ 1,000.00

$ 1,015.50

$

5.73

Class C

1,000.00

1,012.00

 

9.30

Class R

1,000.00

1,014.20

 

6.93

Class Y

1,000.00

1,017.00

 

4.37

Class R5

1,000.00

1,017.10

 

4.32

Class R6

1,000.00

1,016.20

 

4.17

Hypothetical

 

 

 

 

(5% return before expenses)

 

 

 

 

Class A

1,000.00

1,019.19

 

5.74

Class C

1,000.00

1,015.66

 

9.31

Class R

1,000.00

1,018.00

 

6.95

Class Y

1,000.00

1,020.54

 

4.38

Class R5

1,000.00

1,020.59

 

4.33

Class R6

1,000.00

1,020.74

 

4.18

Expenses are equal to the Fund's annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated funds, based on the 6-month period ended February 29, 2020 are as follows:

Class

Expense Ratios

Class A

1.14%

Class C

1.85

Class R

1.38

 

 

Class Y

0.87

Class R5

0.86

Class R6

0.83

The expense ratios reflect voluntary and/or contractual waivers and/or reimbursements of expenses by the Fund's Adviser. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund's prospectus. The "Consolidated Financial Highlights" tables in the Fund's financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

13 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED

SCHEDULE OF INVESTMENTS February 29, 2020

 

 

Principal Amount

 

Value

Asset-Backed Security—0.8%

 

 

 

 

Madison Park Funding XI Ltd., Series 2013-11A, Cl. DR,

 

 

 

 

5.18% [US0003M+325], 7/23/291,2 (Cost $244,425)

$

250,000

$

249,684

 

 

 

 

 

Foreign Government Obligations—1.8%

 

 

 

 

Argentine Republic, 6.875% Sr. Unsec. Nts., 1/26/27

 

300,000

 

129,422

Ghana Government International Bond, 7.875% Sr. Unsec.

 

 

 

 

Nts., 2/11/351

 

280,000

 

277,340

Ukraine, 7.75% Sr. Unsec. Nts., 9/1/201

 

205,000

 

208,853

Total Foreign Government Obligations (Cost $661,151)

 

 

 

615,615

 

 

 

 

 

Corporate Loans—0.1%

 

 

 

 

Claire's Stores, Inc., Sr. Sec., Term B, 8.421% [US0001M +

 

 

 

 

650] 12/18/263,4

 

12,581

 

12,135

Murray Energy Corp., Sr. Sec. Credit Facilities 1st Lien Term

 

 

 

 

Loan, Tranche B2, 9.354% [LIBOR4 + 725], 10/17/223,4,5

 

138,002

 

24,298

Total Corporate Loans (Cost $142,997)

 

 

 

36,433

 

 

 

 

 

Corporate Bonds and Notes—91.4%

 

 

 

 

Consumer Discretionary—19.4%

 

 

 

 

Auto Components—0.8%

 

 

 

 

Dana, Inc., 5.375% Sr. Unsec. Nts., 11/15/27

 

50,000

 

50,625

Loxam SAS, 5.75% Sr. Sub. Nts., 7/15/271

EUR

215,000

 

229,106

 

 

 

 

279,731

 

 

 

 

 

Automobiles—0.6%

 

 

 

 

JB Poindexter & Co., Inc., 7.125% Sr. Unsec. Nts., 4/15/261

 

185,000

 

195,805

 

 

 

 

 

Distributors—0.5%

 

 

 

 

Core & Main Holdings LP, 9.375% PIK Rate, 8.625% Cash

 

 

 

 

Rate, 8.625% Sr. Unsec. Nts., 9/15/241,6

 

165,000

 

171,669

 

 

 

 

 

Entertainment—1.2%

 

 

 

 

AMC Entertainment Holdings, Inc., 6.125% Sr. Sub. Nts.,

 

 

 

 

5/15/27

 

185,000

 

148,467

Netflix, Inc., 3.625% Sr. Unsec. Nts., 5/15/27

EUR

125,000

 

145,612

WMG Acquisition Corp., 3.625% Sr. Sec. Nts., 10/15/261

EUR

100,000

 

115,265

 

 

 

 

409,344

 

 

 

 

 

Hotels, Restaurants & Leisure—4.6%

 

 

 

 

Boyd Gaming Corp., 6.375% Sr. Unsec. Nts., 4/1/26

 

160,000

 

167,096

CEC Entertainment, Inc., 8.00% Sr. Unsec. Nts., 2/15/22

 

40,000

 

38,912

Downstream Development Authority of the Quapaw Tribe of

 

 

 

 

Oklahoma, 10.50% Sr. Sec. Nts., 2/15/231

 

90,000

 

91,162

ESH Hospitality, Inc., 4.625% Sr. Unsec. Nts., 10/1/271

 

140,000

 

136,759

Golden Nugget, Inc., 8.75% Sr. Sub. Nts., 10/1/251

 

95,000

 

95,637

Melco Resorts Finance Ltd., 5.625% Sr. Unsec. Nts., 7/17/271

 

235,000

 

246,344

MGM Resorts International:

 

 

 

 

6.00% Sr. Unsec. Nts., 3/15/23

 

125,000

 

134,792

14 INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

Principal Amount

 

 

Value

Hotels, Restaurants & Leisure (Continued)

 

 

 

 

 

 

MGM Resorts International: (Continued)

 

 

 

 

 

 

7.75% Sr. Unsec. Nts., 3/15/22

 

$

115,000

$

126,130

Penn National Gaming, Inc., 5.625% Sr. Unsec. Nts., 1/15/271

 

 

215,000

 

 

223,137

Scientific Games International, Inc.:

 

 

 

 

 

 

6.625% Sr. Sub. Nts., 5/15/21

 

 

65,000

 

 

65,107

8.25% Sr. Unsec. Nts., 3/15/261

 

 

65,000

 

 

67,234

Yum! Brands, Inc.:

 

 

 

 

 

 

3.875% Sr. Unsec. Nts., 11/1/23

 

 

70,000

 

 

72,022

4.75% Sr. Unsec. Nts., 1/15/301

 

 

60,000

 

 

62,368

 

 

 

 

 

 

1,526,700

 

 

 

 

 

 

 

Household Durables—2.1%

 

 

 

 

 

 

Beazer Homes USA, Inc., 6.75% Sr. Unsec. Nts., 3/15/25

 

 

70,000

 

 

71,779

Lennar Corp., 4.75% Sr. Unsec. Nts., 11/15/22

 

 

303,000

 

 

317,611

Mattamy Group Corp., 5.25% Sr. Unsec. Nts., 12/15/271

 

 

52,000

 

 

53,950

Taylor Morrison Communities, Inc.:

 

 

 

 

 

 

5.875% Sr. Unsec. Nts., 1/31/251

 

 

49,000

 

 

50,378

5.875% Sr. Unsec. Nts., 6/15/271

 

 

130,000

 

 

145,902

6.00% Sr. Unsec. Nts., 9/1/231

 

 

45,000

 

 

46,622

 

 

 

 

 

 

686,242

 

 

 

 

 

 

 

Interactive Media & Services—0.6%

 

 

 

 

 

 

Diamond Sports Group LLC/Diamond Sports Finance Co.:

 

 

 

 

 

 

5.375% Sr. Sec. Nts., 8/15/261

 

 

110,000

 

 

101,628

6.625% Sr. Unsec. Nts., 8/15/271

 

 

135,000

 

 

109,600

 

 

 

 

 

 

211,228

 

 

 

 

 

 

 

Media—6.0%

 

 

 

 

 

 

Affinion Group, Inc., 14% PIK Rate, 12.5% Cash Rate,

 

 

 

 

 

 

12.50% Sr. Unsec. Nts., 11/10/221,6

 

 

54,312

 

 

32,587

Altice Financing SA, 7.50% Sr. Sec. Nts., 5/15/261

 

 

265,000

 

 

279,416

Cablevision Systems Corp., 5.875% Sr. Unsec. Nts., 9/15/22

 

 

135,000

 

 

142,010

CCO Holdings LLC/CCO Holdings Capital Corp., 5.75% Sr.

 

 

 

 

 

 

Unsec. Nts., 2/15/261

 

 

175,000

 

 

182,271

Clear Channel Worldwide Holdings, Inc., 9.25% Sr. Sub. Nts.,

 

 

 

 

 

 

2/15/241

 

 

135,000

 

 

143,719

CSC Holdings LLC, 6.50% Sr. Unsec. Nts., 2/1/291

 

 

225,000

 

 

248,203

DISH DBS Corp.:

 

 

 

 

 

 

5.875% Sr. Unsec. Nts., 11/15/24

 

 

40,000

 

 

41,113

7.75% Sr. Unsec. Nts., 7/1/26

 

 

220,000

 

 

236,810

Hughes Satellite Systems Corp., 7.625% Sr. Unsec. Nts.,

 

 

 

 

 

 

6/15/21

 

 

125,000

 

 

131,860

iHeartCommunications, Inc.:

 

 

 

 

 

 

5.25% Sr. Sec. Nts., 8/15/271

 

 

125,000

 

 

129,144

8.375% Sr. Unsec. Nts., 5/1/27

 

 

64,671

 

 

70,349

IPD 3 BV, 4.50% [EUR003M+450] Sr. Sec. Nts., 7/15/221,2

EUR

 

170,000

 

 

188,537

Lamar Media Corp., 5.75% Sr. Unsec. Nts., 2/1/26

 

 

110,000

 

 

114,609

15 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Media (Continued)

 

 

 

 

 

Telenet Finance Luxembourg Notes Sarl, 5.50% Sr. Sec. Nts.,

 

 

 

 

 

3/1/281

$

70,000

$

74,270

 

 

 

 

 

2,014,898

 

 

 

 

 

 

Specialty Retail—2.6%

 

 

 

 

 

Capitol Investment Merger Sub 2 LLC, 10.00% Sec. Nts.,

 

 

 

 

 

8/1/241

 

135,000

 

 

135,731

Hillman Group, Inc. (The), 6.375% Sr. Unsec. Nts., 7/15/221

 

70,000

 

 

62,978

Lithia Motors, Inc., 5.25% Sr. Unsec. Nts., 8/1/251

 

135,000

 

 

141,131

Michaels Stores, Inc., 8.00% Sr. Unsec. Nts., 7/15/271

 

170,000

 

 

142,026

PetSmart, Inc.:

 

 

 

 

 

5.875% Sr. Sec. Nts., 6/1/251

 

111,000

 

 

111,977

8.875% Sr. Unsec. Nts., 6/1/251

 

140,000

 

 

139,650

Tendam Brands SAU, 5.25% [EUR003M+525] Sr. Sec. Nts.,

 

 

 

 

 

9/15/241,2

EUR

140,000

 

 

152,140

 

 

 

 

 

885,633

 

 

 

 

 

 

Textiles, Apparel & Luxury Goods—0.4%

 

 

 

 

 

Eagle Intermediate Global Holding BV/Ruyi US Finance LLC,

 

 

 

 

 

7.50% Sr. Sec. Nts., 5/1/251

 

175,000

 

 

123,010

 

 

 

 

 

 

Consumer Staples—5.3%

 

 

 

 

 

Beverages—0.9%

 

 

 

 

 

Darling Global Finance BV, 3.625% Sr. Unsec. Nts., 5/15/261

EUR

170,000

 

 

195,394

Sunshine Mid BV, 6.50% Sr. Sec. Nts., 5/15/261

EUR

100,000

 

 

109,152

 

 

 

 

 

304,546

 

 

 

 

 

 

Food & Staples Retailing—0.7%

 

 

 

 

 

Albertsons Cos., Inc./Safeway, Inc./New Albertsons LP/Albertson's LLC:

 

 

 

 

4.625% Sr. Unsec. Nts., 1/15/271

 

73,000

 

 

72,040

6.625% Sr. Unsec. Nts., 6/15/24

 

145,000

 

 

149,349

 

 

 

 

 

221,389

 

 

 

 

 

 

Food Products—2.2%

 

 

 

 

 

Albertsons Cos., Inc./Safeway, Inc./New Albertsons LP/

 

 

 

 

 

Albertson's LLC, 5.875% Sr. Unsec. Nts., 2/15/281

 

80,000

 

 

83,292

JBS USA LUX SA/JBS USA Food Co./JBS USA Finance, Inc.,

 

 

 

 

 

5.50% Sr. Unsec. Nts., 1/15/301

 

130,000

 

 

137,431

Pilgrim's Pride Corp., 5.875% Sr. Unsec. Nts., 9/30/271

 

140,000

 

 

145,341

Post Holdings, Inc.:

 

 

 

 

 

4.625% Sr. Unsec. Nts., 4/15/301

 

60,000

 

 

59,285

5.00% Sr. Unsec. Nts., 8/15/261

 

115,000

 

 

117,513

5.625% Sr. Unsec. Nts., 1/15/281

 

101,000

 

 

105,753

Simmons Foods, Inc., 7.75% Sr. Sec. Nts., 1/15/241

 

65,000

 

 

69,089

 

 

 

 

 

717,704

 

 

 

 

 

 

Household Products—0.6%

 

 

 

 

 

Energizer Holdings, Inc., 5.50% Sr. Unsec. Nts., 6/15/251

 

70,000

 

 

71,182

16 INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

Principal Amount

 

 

Value

Household Products (Continued)

 

 

 

 

 

 

Spectrum Brands, Inc., 5.75% Sr. Unsec. Nts., 7/15/25

$

140,000

$

143,849

 

 

 

 

 

 

215,031

 

 

 

 

 

 

 

Personal Products—0.2%

 

 

 

 

 

 

Edgewell Personal Care Co., 4.70% Sr. Unsec. Nts., 5/24/22

 

65,000

 

 

66,714

 

 

 

 

 

 

 

Tobacco—0.7%

 

 

 

 

 

 

Vector Group Ltd., 6.125% Sr. Sec. Nts., 2/1/25

 

243,000

 

 

233,885

 

 

 

 

 

 

 

Energy—12.0%

 

 

 

 

 

 

Energy Equipment & Services—1.5%

 

 

 

 

 

 

ADES International Holding plc, 8.625% Sr. Sec. Nts.,

 

 

 

 

 

4/24/241

 

 

350,000

 

 

360,500

Basic Energy Services, Inc., 10.75% Sr. Sec. Nts., 10/15/231

 

25,000

 

 

16,125

Calfrac Holdings LP, 10.875% Sec. Nts., 3/15/261

 

15,950

 

 

14,435

Diamond Offshore Drilling, Inc., 4.875% Sr. Unsec. Nts.,

 

 

 

 

 

11/1/43

 

 

25,000

 

 

10,164

Ensign Drilling, Inc., 9.25% Sr. Unsec. Nts., 4/15/241

 

70,000

 

 

63,088

SESI LLC, 7.75% Sr. Unsec. Nts., 9/15/24

 

 

50,000

 

 

24,271

Transocean, Inc., 7.50% Sr. Unsec. Nts., 4/15/31

 

20,000

 

 

11,951

 

 

 

 

 

 

500,534

 

 

 

 

 

 

Oil, Gas & Consumable Fuels—10.5%

 

 

 

 

 

Antero Midstream Partners LP/Antero Midstream Finance

 

 

 

 

 

Corp., 5.375% Sr. Unsec. Nts., 9/15/24

 

 

155,000

 

 

117,412

Ascent Resources Utica Holdings LLC/ARU Finance Corp.,

 

 

 

 

 

10.00% Sr. Unsec. Nts., 4/1/221

 

 

88,000

 

 

75,215

Calfrac Holdings LP, 8.50% Sr. Unsec. Nts., 6/15/261

 

31,000

 

 

8,293

California Resources Corp., 8.00% Sec. Nts., 12/15/221

 

32,000

 

 

7,440

Calumet Specialty Products Partners LP/Calumet Finance

 

 

 

 

 

Corp., 7.625% Sr. Unsec. Nts., 1/15/22

 

 

200,000

 

 

198,378

Centennial Resource Production LLC, 6.875% Sr. Unsec. Nts.,

 

 

 

 

 

4/1/271

 

 

80,000

 

 

71,786

Comstock Resources, Inc., 9.75% Sr. Unsec. Nts., 8/15/26

 

15,000

 

 

12,598

Cosan Luxembourg SA, 7.00% Sr. Unsec. Nts., 1/20/271

 

200,000

 

 

214,070

Denbury Resources, Inc.:

 

 

 

 

 

 

9.00% Sec. Nts., 5/15/211

 

 

35,000

 

 

30,704

9.25% Sec. Nts., 3/31/221

 

 

60,000

 

 

48,169

Energy Transfer Operating LP, 5.875% Sr. Unsec. Nts., 1/15/24

 

140,000

 

 

157,032

EP Energy LLC/Everest Acquisition Finance, Inc., 8.00% Sr.

 

 

 

 

 

Sec. Nts., 11/29/241

 

 

135,000

 

 

57,375

Geopark Ltd., 5.50% Sr. Unsec. Nts., 1/17/271

 

200,000

 

 

188,252

Gulfport Energy Corp., 6.375% Sr. Unsec. Nts., 5/15/25

 

135,000

 

 

43,256

HighPoint Operating Corp., 8.75% Sr. Unsec. Nts., 6/15/25

 

16,000

 

 

13,520

Hilcorp Energy I LP/Hilcorp Finance Co., 6.25% Sr. Unsec.

 

 

 

 

 

Nts., 11/1/28

 

 

325,000

 

 

237,369

Holly Energy Partners LP/Holly Energy Finance Corp., 5.00%

 

 

 

 

 

Sr. Unsec. Nts., 2/1/281

 

 

28,000

 

 

28,227

Murphy Oil USA, Inc., 4.75% Sr. Unsec. Nts., 9/15/29

 

84,000

 

 

88,255

17

INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

CONSOLIDATED

SCHEDULE OF INVESTMENTS Continued

 

 

 

Principal Amount

 

 

Value

Oil, Gas & Consumable Fuels (Continued)

 

 

 

 

 

 

Murray Energy Corp., 3% PIK Rate, 9% Cash Rate, 12.00%

 

 

 

 

 

 

Sec. Nts., 4/15/241,5,6

 

$

130,760

$

165

NAK Naftogaz Ukraine via Kondor Finance plc, 7.625% Sr.

 

 

 

 

 

 

Unsec. Nts., 11/8/261

 

 

200,000

 

 

210,830

Oasis Petroleum, Inc., 6.875% Sr. Unsec. Nts., 3/15/22

 

 

55,000

 

 

43,312

Parkland Fuel Corp., 6.00% Sr. Unsec. Nts., 4/1/261

 

 

195,000

 

 

204,136

Petrobras Global Finance BV:

 

 

 

 

 

 

7.25% Sr. Unsec. Nts., 3/17/44

 

 

85,000

 

 

105,156

8.375% Sr. Unsec. Nts., 5/23/21

 

 

370,000

 

 

395,863

Petroleos Mexicanos, 5.95% Sr. Unsec. Nts., 1/28/311

 

 

385,000

 

 

377,300

Puma International Financing SA, 5.00% Sr. Unsec. Nts.,

 

 

 

 

 

 

1/24/261

 

 

200,000

 

 

187,202

QEP Resources, Inc., 5.625% Sr. Unsec. Nts., 3/1/26

 

 

65,000

 

 

52,164

Range Resources Corp., 5.875% Sr. Unsec. Nts., 7/1/22

 

 

110,000

 

 

94,016

SM Energy Co., 6.625% Sr. Unsec. Nts., 1/15/27

 

 

45,000

 

 

34,980

Southwestern Energy Co., 7.75% Sr. Unsec. Nts., 10/1/27

 

 

40,000

 

 

30,401

Targa Resources Partners LP/Targa Resources Partners Finance

 

 

 

 

 

 

Corp., 5.875% Sr. Unsec. Nts., 4/15/26

 

 

125,000

 

 

128,997

Whiting Petroleum Corp.:

 

 

 

 

 

 

6.25% Sr. Unsec. Nts., 4/1/23

 

 

60,000

 

 

27,150

6.625% Sr. Unsec. Nts., 1/15/26

 

 

80,000

 

 

29,402

 

 

 

 

 

 

3,518,425

 

 

 

 

 

 

 

Financials—14.7%

 

 

 

 

 

 

Capital Markets—1.1%

 

 

 

 

 

 

RegionalCare Hospital Partners Holdings, Inc., 8.25% Sr. Sec.

 

 

 

 

 

 

Nts., 5/1/231

 

 

140,000

 

 

146,512

UBS Group AG, 5.75% [EUSA5+528.7] Jr. Sub. Perpetual

 

 

 

 

 

 

Bonds1,2,7

EUR

 

200,000

 

 

236,509

 

 

 

 

 

 

383,021

 

 

 

 

 

 

 

Commercial Banks—4.5%

 

 

 

 

 

 

Australia & New Zealand Banking Group Ltd. (United

 

 

 

 

 

 

Kingdom), 6.75% [USISDA05+516.8] Jr. Sub. Perpetual

 

 

 

 

 

 

Bonds1,2,7

 

 

40,000

 

 

45,183

Banco Comercial Portugues SA, 9.25% [EUSA5+941.4] Jr.

 

 

 

 

 

 

Sub. Perpetual Bonds1,2,7

EUR

 

200,000

 

 

243,776

Banco do Brasil SA (Cayman), 5.875% Sub. Nts., 1/26/221

 

 

260,000

 

 

272,163

Banco Mercantil del Norte SA (Grand Cayman), 7.50%

 

 

 

 

 

 

[H15T10Y+547] Jr. Sub. Perpetual Bonds1,2,7

 

 

160,000

 

 

181,002

BBVA Bancomer SA, 6.75% Sub. Nts., 9/30/221

 

 

245,000

 

 

265,894

Ibercaja Banco SA, 5.00% [EUSA5+455.1] Sub. Nts.,

 

 

 

 

 

 

7/28/251,2

EUR

 

200,000

 

 

224,302

Itau Unibanco Holding SA (Cayman Island), 5.65% Sub. Nts.,

 

 

 

 

 

 

3/19/221

 

 

255,000

 

 

266,036

 

 

 

 

 

 

1,498,356

18 INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

 

Principal Amount

 

 

Value

Consumer Finance—0.3%

 

 

 

 

 

 

 

Ally Financial, Inc., 4.125% Sr. Unsec. Nts., 3/30/20

 

$

110,000

$

110,331

 

 

 

 

 

 

 

 

Diversified Financial Services—5.6%

 

 

 

 

 

 

 

Alpha Holding SA de CV, 9.00% Sr. Unsec. Nts., 2/10/251

 

 

710,000

 

 

711,775

Caixa Geral de Depositos SA, 10.75% [EUSA5+1092.5] Jr.

 

 

 

 

 

 

Sub. Perpetual Bonds1,2,7

 

EUR

 

200,000

 

 

255,726

eG Global Finance plc, 4.375% Sr. Sec. Nts., 2/7/251

EUR

 

190,000

 

 

195,813

Greenko Mauritius Ltd., 6.25% Sr. Unsec. Nts., 2/21/231

 

 

250,000

 

 

257,746

LPL Holdings, Inc., 5.75% Sr. Unsec. Nts., 9/15/251

 

 

100,000

 

 

103,999

Operadora de Servicios Mega S.A. de CV Sofom ER, 8.25% Sr.

 

 

 

 

 

 

Unsec. Nts., 2/11/251

 

 

 

200,000

 

 

202,750

Tempo Acquisition LLC/Tempo Acquisition Finance Corp.,

 

 

 

 

 

 

6.75% Sr. Unsec. Nts., 6/1/251

 

 

 

140,000

 

 

139,693

 

 

 

 

 

 

 

1,867,502

 

 

 

 

 

 

 

Real Estate Investment Trusts (REITs)—1.5%

 

 

 

 

 

 

CoreCivic, Inc., 4.625% Sr. Unsec. Nts., 5/1/23

 

 

192,000

 

 

192,902

Equinix, Inc., 2.875% Sr. Unsec. Nts., 10/1/25

EUR

 

200,000

 

 

226,346

VICI Properties LP/VICI Note Co., Inc.:

 

 

 

 

 

 

 

3.50% Sr. Unsec. Nts., 2/15/251

 

 

 

27,000

 

 

27,093

3.75% Sr. Unsec. Nts., 2/15/271

 

 

 

27,000

 

 

26,848

4.125% Sr. Unsec. Nts., 8/15/301

 

 

 

27,000

 

 

27,084

 

 

 

 

 

 

 

500,273

 

 

 

 

 

 

 

Real Estate Management & Development—1.7%

 

 

 

 

 

 

Agile Group Holdings Ltd., 9.00% Sr. Sec. Nts., 5/21/201

 

 

150,000

 

 

152,255

ATF Netherlands BV, 3.75% [EUSA5+437.5] Jr. Sub. Perpetual

 

 

 

 

 

 

Bonds1,2,7

 

EUR

 

100,000

 

 

116,490

Times China Holdings Ltd., 7.85% Sr. Sec. Nts., 6/4/211

 

 

300,000

 

 

305,818

 

 

 

 

 

 

 

574,563

 

 

 

 

 

 

 

 

Health Care—5.5%

 

 

 

 

 

 

 

Health Care Providers & Services—3.9%

 

 

 

 

 

 

CHS/Community Health Systems, Inc., 8.00% Sr. Sec. Nts.,

 

 

 

 

 

 

3/15/261

 

 

 

85,000

 

 

87,939

Envision Healthcare Corp., 8.75% Sr. Unsec. Nts., 10/15/261

 

 

90,000

 

 

47,894

HCA, Inc.:

 

 

 

 

 

 

 

5.50% Sr. Sec. Nts., 6/15/47

 

 

 

65,000

 

 

77,378

5.875% Sr. Unsec. Nts., 2/15/26

 

 

 

65,000

 

 

73,497

7.50% Sr. Unsec. Nts., 2/15/22

 

 

 

250,000

 

 

276,745

MEDNAX, Inc., 6.25% Sr. Unsec. Nts., 1/15/27

 

 

186,000

 

 

179,020

MPH Acquisition Holdings LLC, 7.125% Sr. Unsec. Nts.,

 

 

 

 

 

 

6/1/241

 

 

 

75,000

 

 

69,953

Omnicare, Inc., 4.75% Sr. Unsec. Nts., 12/1/22

 

 

30,000

 

 

32,201

Polaris Intermediate Corp., 9.25% PIK Rate, 8.50% Cash

 

 

 

 

 

 

Rate, 8.50% Sr. Unsec. Nts., 12/1/221,6

 

 

 

75,000

 

 

63,945

Surgery Center Holdings, Inc., 10.00% Sr. Unsec. Nts.,

 

 

 

 

 

 

4/15/271

 

 

 

100,000

 

 

109,535

19

INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

CONSOLIDATED

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Health Care Providers & Services (Continued)

 

 

 

 

 

Tenet Healthcare Corp., 8.125% Sr. Unsec. Nts., 4/1/22

$

265,000

$

287,586

 

 

 

 

 

1,305,693

 

 

 

 

 

 

Pharmaceuticals—1.6%

 

 

 

 

 

Bausch Health Americas, Inc., 8.50% Sr. Unsec. Nts., 1/31/271

 

115,000

 

 

126,400

Bausch Health Cos., Inc.:

 

 

 

 

 

5.875% Sr. Unsec. Nts., 5/15/231

 

6,000

 

 

6,026

9.00% Sr. Unsec. Nts., 12/15/251

 

60,000

 

 

66,958

HLF Financing Sarl LLC/Herbalife International, Inc., 7.25% Sr.

 

 

 

 

 

Unsec. Nts., 8/15/261

 

70,000

 

 

70,787

Par Pharmaceutical, Inc., 7.50% Sr. Sec. Nts., 4/1/271

 

70,000

 

 

74,097

Teva Pharmaceutical Finance Netherlands II BV, 6.00% Sr.

 

 

 

 

 

Unsec. Nts., 1/31/251

EUR

100,000

 

 

115,499

Teva Pharmaceutical Finance Netherlands III BV, 4.10% Sr.

 

 

 

 

 

Unsec. Nts., 10/1/46

 

100,000

 

 

78,010

 

 

 

 

 

537,777

 

 

 

 

 

 

Industrials—11.5%

 

 

 

 

 

Aerospace & Defense—2.1%

 

 

 

 

 

Bombardier, Inc.:

 

 

 

 

 

5.75% Sr. Unsec. Nts., 3/15/221

 

70,000

 

 

71,525

7.875% Sr. Unsec. Nts., 4/15/271

 

140,000

 

 

139,303

8.75% Sr. Unsec. Nts., 12/1/211

 

165,000

 

 

175,027

Signature Aviation US Holdings, Inc., 5.375% Sr. Unsec. Nts.,

 

 

 

 

 

5/1/261

 

120,000

 

 

122,721

Spirit AeroSystems, Inc., 4.60% Sr. Unsec. Nts., 6/15/28

 

28,000

 

 

27,823

Triumph Group, Inc., 7.75% Sr. Unsec. Nts., 8/15/25

 

170,000

 

 

168,796

 

 

 

 

 

705,195

 

 

 

 

 

 

Airlines—0.6%

 

 

 

 

 

Air Canada, 7.75% Sr. Unsec. Nts., 4/15/211

 

180,000

 

 

188,172

 

 

 

 

 

 

Building Products—0.1%

 

 

 

 

 

Advanced Drainage Systems, Inc., 5.00% Sr. Unsec. Nts.,

 

 

 

 

 

9/30/271

 

17,000

 

 

17,622

 

 

 

 

 

 

Commercial Services & Supplies—1.5%

 

 

 

 

 

Brink's Co. (The), 4.625% Sr. Unsec. Nts., 10/15/271

 

100,000

 

 

102,732

Core & Main LP, 6.125% Sr. Unsec. Nts., 8/15/251

 

125,000

 

 

126,886

GFL Environmental, Inc., 5.625% Sr. Unsec. Nts., 5/1/221

 

130,000

 

 

131,991

Intrum AB, 2.75%, 7/15/221

EUR

90,000

 

 

98,779

Pitney Bowes, Inc., 5.20% Sr. Unsec. Nts., 4/1/23

 

28,000

 

 

28,082

 

 

 

 

 

488,470

 

 

 

 

 

 

Electrical Equipment—0.1%

 

 

 

 

 

EnerSys, 4.375% Sr. Unsec. Nts., 12/15/271

 

47,000

 

 

47,646

 

 

 

 

 

 

Machinery—3.7%

 

 

 

 

 

Cleaver-Brooks, Inc., 7.875% Sr. Sec. Nts., 3/1/231

 

150,000

 

 

148,187

20 INVESCO HIGH YIELD BOND FACTOR FUND

 

 

Principal Amount

 

 

Value

Machinery (Continued)

 

 

 

 

 

Colfax Corp.:

 

 

 

 

 

3.25% Sr. Unsec. Nts., 5/15/251

EUR

170,000

$

190,205

6.00% Sr. Unsec. Nts., 2/15/241

 

65,000

 

 

67,512

EnPro Industries, Inc., 5.75% Sr. Unsec. Nts., 10/15/26

145,000

 

 

154,476

IHS Netherlands Holdco BV, 8.00% Sr. Unsec. Nts., 9/18/271

200,000

 

 

216,176

Meritor, Inc., 6.25% Sr. Unsec. Nts., 2/15/24

165,000

 

 

169,424

Mueller Industries, Inc., 6.00% Sub. Nts., 3/1/27

165,000

 

 

167,120

Titan International, Inc., 6.50% Sr. Sec. Nts., 11/30/23

185,000

 

 

139,289

 

 

 

 

 

1,252,389

 

 

 

 

 

 

Road & Rail—0.4%

 

 

 

 

 

Kenan Advantage Group, Inc. (The), 7.875% Sr. Unsec. Nts.,

 

 

 

 

7/31/231

 

130,000

 

 

128,429

 

 

 

 

 

Trading Companies & Distributors—3.0%

 

 

 

 

AerCap Global Aviation Trust, 6.50% [US0003M+430] Jr. Sub.

 

 

 

 

Nts., 6/15/451,2

 

200,000

 

 

215,520

BMC East LLC, 5.50% Sr. Sec. Nts., 10/1/241

145,000

 

 

149,773

Fly Leasing Ltd., 5.25% Sr. Unsec. Nts., 10/15/24

245,000

 

 

251,839

Herc Holdings, Inc., 5.50% Sr. Unsec. Nts., 7/15/271

130,000

 

 

135,190

United Rentals North America, Inc., 6.50% Sr. Unsec. Nts.,

 

 

 

 

12/15/26

 

240,000

 

 

256,356

 

 

 

 

 

1,008,678

 

 

 

 

 

 

Information Technology—2.3%

 

 

 

 

 

Communications Equipment—0.3%

 

 

 

 

 

CommScope Technologies LLC, 6.00% Sr. Unsec. Nts.,

 

 

 

 

6/15/251

 

115,000

 

 

108,388

 

 

 

 

 

Electronic Equipment, Instruments, & Components—0.6%

 

 

 

 

Itron, Inc., 5.00% Sr. Unsec. Nts., 1/15/261

 

145,000

 

 

149,662

MTS Systems Corp., 5.75% Sr. Unsec. Nts., 8/15/271

50,000

 

 

51,017

 

 

 

 

 

200,679

 

 

 

 

 

 

IT Services—0.7%

 

 

 

 

 

Cardtronics, Inc./Cardtronics USA, Inc., 5.50% Sr. Unsec. Nts.,

 

 

 

 

5/1/251

 

220,000

 

 

226,141

 

 

 

 

 

Technology Hardware, Storage & Peripherals—0.7%

 

 

 

 

Everi Payments, Inc., 7.50% Sr. Unsec. Nts., 12/15/251

54,000

 

 

56,722

Western Digital Corp., 4.75% Sr. Unsec. Nts., 2/15/26

170,000

 

 

175,844

 

 

 

 

 

232,566

 

 

 

 

 

 

Materials—13.0%

 

 

 

 

 

Chemicals—2.1%

 

 

 

 

 

Braskem Idesa SAPI, 7.45% Sr. Sec. Nts., 11/15/291

200,000

 

 

200,348

OCI NV, 6.625% Sr. Sec. Nts., 4/15/231

 

200,000

 

 

207,900

PQ Corp., 6.75% Sr. Sec. Nts., 11/15/221

 

80,000

 

 

81,899

21

INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

CONSOLIDATED

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Chemicals (Continued)

 

 

 

 

 

Unigel Luxembourg SA, 8.75% Sr. Unsec. Nts., 10/1/261

$

200,000

$

200,475

 

 

 

 

 

690,622

 

 

 

 

 

 

Construction Materials—0.4%

 

 

 

 

 

Maxeda DIY Holding BV, 6.125% Sr. Sec. Nts., 7/15/221

EUR

130,000

 

 

128,933

 

 

 

 

 

 

Containers & Packaging—3.6%

 

 

 

 

 

Ardagh Packaging Finance plc/Ardagh Holdings USA, Inc.:

 

 

 

 

 

4.25% Sr. Sec. Nts., 9/15/22

 

200,000

 

 

199,803

6.00% Sr. Unsec. Nts., 2/15/251

 

265,000

 

 

276,925

Cascades, Inc./Cascades USA, Inc., 5.125% Sr. Unsec. Nts.,

 

 

 

 

 

1/15/261

 

243,000

 

 

252,112

OI European Group BV, 4.00% Sr. Unsec. Nts., 3/15/231

 

240,000

 

 

243,399

Trivium Packaging Finance BV, 5.50% Sr. Sec. Nts., 8/15/261

 

220,000

 

 

228,388

 

 

 

 

 

1,200,627

 

 

 

 

 

 

Metals & Mining—5.5%

 

 

 

 

 

Alcoa Nederland Holding BV, 6.125% Sr. Unsec. Nts.,

 

 

 

 

 

5/15/281

 

215,000

 

 

221,052

CSN Islands XI Corp., 6.75% Sr. Unsec. Nts., 1/28/281

 

400,000

 

 

363,100

First Quantum Minerals Ltd., 7.25% Sr. Unsec. Nts., 4/1/231

 

200,000

 

 

192,417

Freeport-McMoRan, Inc.:

 

 

 

 

 

3.55% Sr. Unsec. Nts., 3/1/22

 

222,000

 

 

224,371

5.40% Sr. Unsec. Nts., 11/14/34

 

70,000

 

 

68,438

Hudbay Minerals, Inc., 7.625% Sr. Unsec. Nts., 1/15/251

 

125,000

 

 

120,677

Metinvest BV, 7.75% Sr. Unsec. Nts., 10/17/291

 

320,000

 

 

323,168

SunCoke Energy Partners LP/SunCoke Energy Partners Finance

 

 

 

 

 

Corp., 7.50% Sr. Unsec. Nts., 6/15/251

 

155,000

 

 

139,886

Vedanta Resources Ltd., 8.25% Sr. Unsec. Nts., 6/7/211

 

200,000

 

 

202,036

 

 

 

 

 

1,855,145

 

 

 

 

 

 

Paper & Forest Products—1.4%

 

 

 

 

 

Norbord, Inc., 5.75% Sr. Sec. Nts., 7/15/271

 

70,000

 

 

73,524

Schweitzer-Mauduit International, Inc., 6.875% Sr. Unsec.

 

 

 

 

 

Nts., 10/1/261

 

150,000

 

 

161,302

Suzano Austria GmbH, 5.75% Sr. Unsec. Nts., 7/14/261

 

200,000

 

 

226,070

 

 

 

 

 

460,896

 

 

 

 

 

 

Telecommunication Services—5.8%

 

 

 

 

 

Diversified Telecommunication Services—2.4%

 

 

 

 

 

Altice France SA, 7.375% Sr. Sec. Nts., 5/1/261

 

75,000

 

 

78,791

CenturyLink, Inc., Series Y, 7.50% Sr. Unsec. Nts., 4/1/24

 

190,000

 

 

213,354

CommScope, Inc., 5.50% Sr. Sec. Nts., 3/1/241

 

80,000

 

 

81,325

Frontier Communications Corp., 10.50% Sr. Unsec. Nts.,

 

 

 

 

 

9/15/22

 

257,000

 

 

117,336

HTA Group Ltd. (Mauritius), 9.125% Sr. Unsec. Nts., 3/8/221

 

120,000

 

 

123,247

Intelsat Jackson Holdings SA, 9.75% Sr. Unsec. Nts., 7/15/251

 

70,000

 

 

62,096

Telecom Italia Capital SA:

 

 

 

 

 

7.20% Sr. Unsec. Nts., 7/18/36

 

50,000

 

 

62,043

22 INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

Principal Amount

 

 

Value

 

Diversified Telecommunication Services (Continued)

 

 

 

 

 

 

Telecom Italia Capital SA: (Continued)

 

 

 

 

 

 

7.721% Sr. Unsec. Nts., 6/4/38

$

55,000

$

71,368

 

 

 

 

 

 

809,560

 

 

 

 

 

 

 

Wireless Telecommunication Services—3.4%

 

 

 

 

 

Intelsat Jackson Holdings SA, 8.50% Sr. Unsec. Nts.,

 

 

 

 

 

10/15/241

 

155,000

 

 

135,948

Intelsat Luxembourg SA, 7.75% Sr. Unsec. Nts., 6/1/21

 

75,000

 

 

56,812

SoftBank Group Corp.:

 

 

 

 

 

4.00% Sr. Unsec. Nts., 4/20/231

EUR

180,000

 

 

210,726

5.00% Sr. Unsec. Nts., 4/15/281

EUR

100,000

 

 

121,495

Sprint Capital Corp.:

 

 

 

 

 

6.875% Sr. Unsec. Nts., 11/15/28

 

45,000

 

 

53,676

8.75% Sr. Unsec. Nts., 3/15/32

 

15,000

 

 

20,878

Sprint Corp., 7.625% Sr. Unsec. Nts., 2/15/25

 

145,000

 

 

168,563

T-Mobile USA, Inc., 6.375% Sr. Unsec. Nts., 3/1/25

 

360,000

 

 

370,877

 

 

 

 

 

 

1,138,975

 

 

 

 

 

 

 

Utilities—1.9%

 

 

 

 

 

Electric Utilities—0.1%

 

 

 

 

 

DPL, Inc., 4.35% Sr. Unsec. Nts., 4/15/291

 

44,000

 

 

41,156

 

 

 

 

 

 

Gas Utilities—0.5%

 

 

 

 

 

AmeriGas Partners LP/AmeriGas Finance Corp., 5.875% Sr.

 

 

 

 

 

Unsec. Nts., 8/20/26

 

165,000

 

 

171,496

 

 

 

 

 

Independent Power and Renewable Electricity Producers—1.3%

 

 

 

 

AES Corp., 4.50%, 3/15/23

 

188,000

 

 

187,456

YPF Energia Electrica SA, 10.00% Sr. Unsec. Nts., 7/25/261

 

275,000

 

 

242,655

 

 

 

 

 

 

430,111

Total Corporate Bonds and Notes (Cost $31,136,890)

 

 

 

 

30,591,900

 

 

 

Shares

 

 

 

 

Preferred Stock—0.0%

 

 

 

 

 

 

Claire's Holdings LLC, 0.00%, Series A8 (Cost $3,125)

 

5

 

 

875

 

 

 

 

 

 

 

Common Stocks—0.0%

 

 

 

 

 

Claire's Holdings LLC8

 

20

 

 

11,000

Quicksilver Resources, Inc.8,9

 

155,000

 

 

Total Common Stocks (Cost $138,389)

 

 

 

 

11,000

 

 

 

Units

 

 

 

 

Rights, Warrants and Certificates—0.0%

 

 

 

 

 

 

Agro Holdings, Inc. Wts., Exp. 4/10/248,9 (Cost $0)

 

39

 

 

 

 

 

Shares

 

 

 

 

Investment Companies—7.6%

 

 

 

 

 

 

Invesco Government & Agency Portfolio, Institutional Class, 1.50%10

2,423,448

 

 

2,423,448

23 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED

SCHEDULE OF INVESTMENTS Continued

 

Shares

 

Value

Investment Companies (Continued)

 

 

 

SPDR Bloomberg Barclays Short Term High Yield Bond ETF

5,000

$

132,350

Total Investment Companies (Cost $2,557,248)

 

 

2,555,798

 

 

 

 

Total Investments, at Value (Cost $34,884,225)

101.7%

 

34,061,305

Net Other Assets (Liabilities)

Net Assets

(1.7)

(574,179)

100.0% $

33,487,126

 

 

Footnotes to Consolidated Schedule of Investments

1.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 February 29, 2020 was $21,743,893, which represented 64.93% of the Fund's Net Assets.

2.Represents the current interest rate for a variable or increasing rate security, which may be fixed for a predetermined period. The interest rate is, or will be as of an established date, determined as [Referenced Rate + Basis-point spread].

3.Variable rate senior loan interests are, at present, not readily marketable, not registered under the Securities Act of 1933, as amended (the "1933 Act"), and may be subject to contractual and legal restrictions on sale. Variable rate senior loan interests in the Fund's portfolio generally have variable rates which adjust to a base, such as the London Interbank Offered Rate ("LIBOR"), on set dates, typically every 30 days but not greater than one year; and/ or have interest rates that float at a margin above a widely recognized base lending rate such as the Prime Rate of a designated U.S. bank.

4.Variable rate senior loan interests often require prepayments from excess cash flow or permit the borrower to repay at its election. The degree to which borrowers repay, whether as a contractual requirement or at their election, cannot be predicted with accuracy. As a result, the actual remaining maturity may be substantially less than the stated maturities shown. However, it is anticipated that the variable rate senior loan interests will have an expected average life of three to five year.

5.This security is not accruing income because its issuer has missed or is expected to miss interest and/or principal payments. The rate shown is the contractual interest rate.

6.Interest or dividend is paid-in-kind, when applicable.

7.This bond has no contractual maturity date, is not redeemable and contractually pays an indefinite stream of interest.

8.Non-income producing security.

9.The value of this security was determined using significant unobservable inputs. See Note 3 of the accompanying

Consolidated Notes.

10.The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the

7-day SEC standardized yield as of February 29, 2020.

The following issuer is or was an affiliate, as defined in the Investment Company Act of 1940, as amended, at or during the period, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. There were no affiliated securities held by the Fund at period end. Transactions during the period in which the issuer was an affiliate are as follows:

 

Shares

Gross

Gross

Shares

 

May 31, 2019

Additions

ReductionsFebruary 29, 2020

Common Stock

 

 

 

 

Hexion Holdings Corp., Cl. B

1,943

1,943

24 INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

Change in

 

 

Realized

Unrealized

Value

Income

Gain (Loss)

Gain (Loss)

Common Stock

 

 

 

 

 

 

Hexion Holdings Corp., Cl. B

$

— $

— $

(16,252)

$

Total

$

— $

— $

(16,252)

$

 

 

 

 

 

 

 

Distribution of investments representing geographic holdings, as a percentage of total investments at value, is as follows:

Geographic Holdings

 

Value

Percent

United States

$

19,711,747

57.9%

Brazil

 

2,042,932

6.0

Mexico

 

1,939,068

5.7

Canada

 

1,496,233

4.4

Netherlands

 

862,909

2.5

Ukraine

 

742,851

2.2

Ireland

 

667,162

2.0

China

 

581,083

1.7

Luxembourg

 

534,273

1.6

Portugal

 

499,502

1.5

India

 

459,782

1.3

Spain

 

376,442

1.1

Argentina

 

372,077

1.1

Saudi Arabia

 

360,500

1.1

Nigeria

 

339,423

1.0

Japan

 

332,221

1.0

France

 

307,897

0.9

Ghana

 

277,340

0.8

Cayman Islands

 

249,684

0.7

Hong Kong

 

246,344

0.7

Switzerland

 

236,509

0.7

United Kingdom

 

195,813

0.6

Israel

 

193,509

0.6

Zambia

 

192,417

0.6

Colombia

 

188,252

0.5

Singapore

 

187,202

0.5

Italy

 

133,411

0.4

Germany

 

116,490

0.3

Sweden

 

98,779

0.3

Belgium

 

74,270

0.2

Australia

 

45,183

0.1

Total

$

34,061,305

100.0%

 

 

 

 

 

Forward Currency Exchange Contracts as of February 29, 2020

 

 

 

 

Counter

Settlement

 

Currency

 

Currency Sold

 

Unrealized

 

Unrealized

-party

Month(s)

Purchased (000's)

 

(000's)

 

Appreciation

 

Depreciation

CITNA-B

05/2020

USD

273

CAD

367

$

64

$

RBC

05/2020

USD

3,592

EUR

3,243

 

 

(3,947)

 

 

 

25

INVESCO HIGH YIELD BOND FACTOR FUND

 

 

 

CONSOLIDATED

SCHEDULE OF INVESTMENTS Continued

Forward Currency Exchange Contracts (Continued)

 

 

 

 

 

 

Counter

Settlement

 

Currency

Currency Sold

 

Unrealized

 

Unrealized

-party

Month(s)

Purchased (000's)

(000's)

 

Appreciation

 

Depreciation

RBC

05/2020

USD

371 GBP

289

$

— $

(35)

Total Unrealized Appreciation and Depreciation

 

$

64

$

(3,982)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Futures Contracts as of February 29, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized

 

Expiration

NumberNotional Amount

 

 

 

 

Appreciation/

Description

Buy/Sell

Date

of Contracts

(000's)

 

Value

 

(Depreciation)

Euro-BOBL

Sell

3/6/20

3

EUR 445 $

 

449,286 $

 

(4,774)

Euro-BUND

Sell

3/6/20

2

EUR 382

 

391,814

 

 

(10,226)

Euro-Schatz

Sell

3/6/20

6

EUR 742

 

743,941

 

 

(2,294)

United States

 

 

 

 

 

 

 

 

 

Treasury Nts., 10 yr.

Buy

6/19/20

11

USD 1,464

 

1,482,250

 

 

17,938

United States

 

 

 

 

 

 

 

 

 

Treasury Nts., 5 yr.

Buy

6/30/20

15

USD 1,824

 

1,841,250

 

 

16,845

United States Ultra

 

 

 

 

 

 

 

 

 

Bonds, 10 yr.

Buy

6/19/20

2

USD 296

 

300,438

 

 

4,433

 

 

 

 

 

 

$

 

21,922

Glossary:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparty Abbreviations

 

 

 

 

 

 

 

 

CITNA-B

Citibank NA

 

 

 

 

 

 

 

 

RBC

RBC Dominion Securities

 

 

 

 

 

 

 

Currency abbreviations indicate amounts reporting in currencies

 

 

 

 

 

CAD

Canadian Dollar

 

 

 

 

 

 

 

EUR

Euro

 

 

 

 

 

 

 

 

GBP

British Pound Sterling

 

 

 

 

 

 

 

Definitions

 

 

 

 

 

 

 

 

 

BOBL

German Federal Obligation

 

 

 

 

 

 

BUND

German Federal Obligation

 

 

 

 

 

 

ETF

Exchange Traded Fund

 

 

 

 

 

 

 

EUR003M

Euro Interbank Offered Rate 3 Month ACT/360

 

 

 

 

 

EUSA5

EUR Swap Annual 5 Year

 

 

 

 

 

 

 

H15T10Y

US Treasury Yield Curve Rate T Note Constant Maturity 10 Year

 

 

 

 

 

LIBOR4

London Interbank Offered Rate-Quarterly

 

 

 

 

 

 

US0001M

Intercontinental Exchange London Interbank Offered Rate USD 1 Month

 

 

US0003M

Intercontinental Exchange London Interbank Offered Rate USD 3 Month

 

 

USISDA05

USD Intercontinental Exchange Swap Rate 11:00am NY 5 Year

 

 

 

 

 

See accompanying Notes to Consolidated Financial Statements.

26 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED STATEMENT OF

ASSETS AND LIABILITIES February 29, 2020

Assets

 

 

Investments, at value—see accompanying consolidated schedule of investments:

 

 

Unaffiliated companies (cost $32,460,777)

$

31,637,857

Affiliated companies (cost $2,423,448)

 

2,423,448

 

 

34,061,305

Cash

 

404,929

Cash—foreign currencies (cost $705,421)

 

698,945

Unrealized appreciation on forward currency exchange contracts

 

64

Receivables and other assets:

 

 

Interest and dividends

 

513,655

Shares of beneficial interest sold

 

182,263

Investments sold

 

82,111

Variation margin receivable - futures contracts

 

75,555

Other

 

92,498

Total assets

 

36,111,325

 

 

 

Liabilities

 

 

Unrealized depreciation on forward currency exchange contracts

 

3,982

Payables and other liabilities:

 

 

Investments purchased

 

2,186,025

Shares of beneficial interest redeemed

 

128,614

Shareholder communications

 

32,434

Transfer and shareholder servicing agent fees

 

24,766

Trustees' compensation

 

17,631

Distribution and service plan fees

 

10,239

Dividends

 

7,295

Advisory fees

 

859

Administration fees

 

39

Other

 

212,315

Total liabilities

 

2,624,199

 

 

 

Net Assets

$

33,487,126

 

 

 

 

 

 

Composition of Net Assets

 

 

Shares of beneficial interest

$

38,118,157

Total accumulated loss

 

(4,631,031)

Net Assets

$

33,487,126

 

 

 

27 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED STATEMENT OF

ASSETS AND LIABILITIES Continued

Net Asset Value Per Share

 

Class A Shares:

 

Net asset value and redemption price per share (based on net assets of $23,444,537 and

 

2,608,784 shares of beneficial interest outstanding)

$8.99

Maximum offering price per share (net asset value plus sales charge of 4.25% of offering price)

$9.39

 

 

Class C Shares:

 

Net asset value, redemption price (excludes applicable contingent deferred sales charge) and

 

offering price per share (based on net assets of $5,718,924 and 636,671 shares of beneficial

 

interest outstanding)

$8.98

 

 

Class R Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of

 

$3,098,398 and 344,696 shares of beneficial interest outstanding)

$8.99

 

 

Class Y Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of

 

$1,105,054 and 122,918 shares of beneficial interest outstanding)

$8.99

 

 

Class R5 Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of $9,966

 

and 1,109 shares of beneficial interest outstanding)

$8.99

 

 

Class R6 Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of $110,247

 

and 12,256 shares of beneficial interest outstanding)

$9.00

See accompanying Notes to Consolidated Financial Statements.

28 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED STATEMENT OF

OPERATIONS

 

 

Nine Months Ended

 

Year Ended

 

 

February 29, 2020

 

May 31, 2019

Investment Income

 

 

 

 

Interest (net of foreign withholding taxes of $3,864 and 2,520,

 

 

 

 

respectively)

$

1,438,240

$

2,558,169

Dividends:

 

 

 

 

Unaffiliated companies

 

2,297

 

1,473

Affiliated companies

 

35,929

 

32,607

 

 

 

 

 

Total investment income

 

1,476,466

 

2,592,249

 

 

 

 

 

Expenses

 

 

 

 

Advisory fees

 

186,758

 

291,828

Administration fees

 

3,604

 

51

Distribution and service plan fees:

 

 

 

 

Class A

 

40,766

 

50,671

Class C

 

43,820

 

64,517

Class R

 

11,204

 

11,890

Transfer and shareholder servicing agent fees:

 

 

 

 

Class A

 

64,806

 

37,266

Class C

 

16,210

 

11,193

Class R

 

8,298

 

4,216

Class Y

 

3,284

 

2,434

Class R5

 

3

 

Class R6

 

9

 

1,933

Shareholder communications:

 

 

 

 

Class A

 

22,038

 

20,561

Class C

 

5,483

 

7,779

Class R

 

2,840

 

6,459

Class Y

 

1,085

 

604

Class R5

 

10

 

Class R6

 

95

 

122

Legal, auditing and other professional fees

 

85,642

 

113,925

Registration fees

 

45,845

 

4,688

Custodian fees and expenses

 

45,666

 

59,221

Trustees' compensation

 

23,426

 

19,264

Borrowing fees

 

 

1,157

Other

 

29,377

 

1,406

Total expenses

 

640,269

 

711,185

Less waivers and reimbursements of expenses

 

(317,337)

 

(247,074)

Net expenses

 

322,932

 

464,111

 

 

 

 

 

Net Investment Income

 

1,153,534

 

2,128,138

29 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED STATEMENT OF

OPERATIONS Continued

 

 

Nine Months Ended

 

Year Ended

 

 

February 29, 2020

 

May 31, 2019

Realized and Unrealized Gain (Loss)

 

 

 

 

Net realized gain (loss) on:

 

 

 

 

Investment transactions in:

 

 

 

 

Unaffiliated companies

$

139,781

$

(1,166,379)

Affiliated companies

 

(16,252)

 

Futures contracts

 

92,875

 

Foreign currency transactions

 

(81,149)

 

Forward currency exchange contracts

 

926

 

Swap contracts

 

(7,497)

 

6,800

Swaption contracts written

 

2,465

 

Net realized gain (loss)

 

131,149

 

(1,159,579)

 

 

 

 

 

Net change in unrealized appreciation/(depreciation) on:

 

 

 

 

Investment transactions in unaffiliated companies

 

(22,225)

 

128,199

Translation of assets and liabilities denominated in foreign currencies

 

(6,432)

 

Forward currency exchange contracts

 

(3,918)

 

Futures contracts

 

21,922

 

Net change in unrealized appreciation/(depreciation)

 

(10,653)

 

128,199

 

 

 

 

 

Net Increase in Net Assets Resulting from Operations

$

1,274,030

$

1,096,758

 

 

 

 

 

See accompanying Notes to Consolidated Financial Statements.

30 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

 

Nine Months Ended

 

Year Ended

 

Year Ended

 

 

February 29, 2020

 

May 31, 2019

 

May 31, 2018

Operations

 

 

 

 

 

 

Net investment income

$

1,153,534

$

2,128,138

$

2,432,145

 

 

 

 

 

 

 

Net realized gain (loss)

 

131,149

 

(1,159,579)

 

7,914

 

 

 

 

 

 

 

Net change in unrealized appreciation/(depreciation)

 

(10,653)

 

128,199

 

(1,687,719)

Net increase in net assets resulting from operations

 

1,274,030

 

1,096,758

 

752,340

 

 

 

 

 

 

 

Dividends and/or Distributions to Shareholders

 

 

 

 

 

 

Distributions to shareholders from distributable

 

 

 

 

 

 

earnings:

 

 

 

 

 

 

Class A

 

(808,286)

 

(1,229,430)

 

(1,200,696)

Class C

 

(172,968)

 

(323,053)

 

(325,880)

Class R

 

(98,117)

 

(132,581)

 

(94,006)

Class Y

 

(43,829)

 

(84,453)

 

(109,242)

Class R5

 

(371)

 

(5)

 

Class R6

 

(3,852)

 

(391,557)

 

(723,071)

Total distributions from distributable earnings

 

 

 

 

 

 

 

(1,127,423)

 

(2,161,079)

 

(2,452,895)

 

 

 

 

 

 

 

Tax return of capital distribution:

 

 

 

 

 

 

Class A

 

(42,363)

 

 

Class C

 

(9,065)

 

 

Class R

 

(5,142)

 

 

Class Y

 

(2,297)

 

 

Class R5

 

(19)

 

 

Class R6

 

(202)

 

 

 

 

 

 

 

 

 

Total return of capital distribution

 

(59,088)

 

 

 

 

 

 

 

 

Beneficial Interest Transactions

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from

 

 

 

 

 

 

beneficial interest transactions:

 

 

 

 

 

 

Class A

 

611,835

 

1,660,139

 

(4,911,855)

Class C

 

(796,976)

 

(331,917)

 

173,441

Class R

 

254,611

 

703,228

 

716,623

Class Y

 

(408,281)

 

7,237

 

(636,985)

Class R5

 

 

10,000

 

Class R6

 

(13,627)

 

(12,756,849)

 

3,817,547

Total beneficial interest transactions

 

(352,438)

 

(10,708,162)

 

(841,229)

 

 

 

 

 

 

 

Net Assets

 

 

 

 

 

 

Total decrease

 

(264,919)

 

(11,772,483)

 

(2,541,784)

Beginning of period

 

33,752,045

 

45,524,528

 

48,066,312

End of period

 

 

 

 

 

 

$

33,487,126

$

33,752,045

$

45,524,528

 

 

 

 

 

 

 

See accompanying Notes to Consolidated Financial Statements.

31 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED FINANCIAL HIGHLIGHTS

 

Nine Months

 

 

 

 

 

 

Ended

Year Ended

Year Ended

Year Ended

Year Ended

Year Ended

Class A

February 29,

May 31,

May 31,

May 31,

May 31,

May 29,

2020

2019

2018

2017

2016

20151

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$8.96

$9.17

$9.51

$9.07

$9.75

$10.25

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income2

0.32

0.51

0.49

0.45

0.44

0.49

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.04

(0.21)

(0.34)

0.45

(0.67)

(0.50)

Total from investment

 

 

 

 

 

 

operations

0.36

0.30

0.15

0.90

(0.23)

(0.01)

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.31)

(0.51)

(0.49)

(0.46)

(0.45)

(0.49)

Tax return of capital

 

 

 

 

 

 

distribution

(0.02)

0.00

0.00

0.00

0.00

0.00

Total dividends and/or

 

 

 

 

 

 

distributions to shareholders

(0.33)

(0.51)

(0.49)

(0.46)

(0.45)

(0.49)

Net asset value, end of period

$8.99

$8.96

$9.17

$9.51

$9.07

$9.75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value3

4.04%

3.42%

1.61%

10.08%

(2.22)%

(0.07)%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$23,445

$22,791

$21,669

$27,376

$28,286

$31,973

Average net assets (in

 

 

 

 

 

 

thousands)

$23,415

$21,629

$22,936

$29,041

$28,307

$31,185

Ratios to average net assets:4

 

 

 

 

 

 

Net investment income

4.72%

5.61%

5.19%

4.85%

4.90%

4.94%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

2.40%

1.78%

1.68%

1.59%

1.56%

1.40%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%

Total expenses

2.40%6

1.78%6

1.68%6

1.59%6

1.56%6

1.40%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

1.15%

1.15%

1.06%

1.21%

1.24%

1.15%

Portfolio turnover rate7

127%

56%

71%

89%

54%

67%

32 INVESCO HIGH YIELD BOND FACTOR FUND

1.Represents the last business day of the Fund's reporting period.

2.Calculated based on the average shares outstanding during the period.

3.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.

4.Annualized for periods less than one full year.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Nine Months Ended February 29, 2020

2.41%

Year Ended May 31, 2019

1.78%

Year Ended May 31, 2018

1.68%

Year Ended May 31, 2017

1.59%

Year Ended May 31, 2016

1.57%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

See accompanying Notes to Consolidated Financial Statements.

33 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED FINANCIAL HIGHLIGHTS Continued

 

Nine Months

 

 

 

 

 

 

Ended

Year Ended

Year Ended

Year Ended

Year Ended

Year Ended

Class C

February 29,

May 31,

May 31,

May 31,

May 31,

May 29,

2020

2019

2018

2017

2016

20151

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$8.96

$9.16

$9.50

$9.06

$9.75

$10.25

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income2

0.27

0.44

0.42

0.39

0.38

0.42

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.03

(0.19)

(0.33)

0.44

(0.68)

(0.50)

Total from investment

 

 

 

 

 

 

operations

0.30

0.25

0.09

0.83

(0.30)

(0.08)

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.27)

(0.45)

(0.43)

(0.39)

(0.39)

(0.42)

Tax return of capital

 

 

 

 

 

 

distribution

(0.01)

0.00

0.00

0.00

0.00

0.00

Total dividends and/or

 

 

 

 

 

 

distributions to shareholders

(0.28)

(0.45)

(0.43)

(0.39)

(0.39)

(0.42)

Net asset value, end of period

$8.98

$8.96

$9.16

$9.50

$9.06

$9.75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value3

3.39%

2.81%

0.90%

9.33%

(3.00)%

(0.76)%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$5,719

$6,484

$6,972

$7,070

$4,458

$3,876

Average net assets (in

 

 

 

 

 

 

thousands)

$5,850

$6,498

$7,161

$6,056

$4,083

$2,632

Ratios to average net assets:4

 

 

 

 

 

 

Net investment income

4.02%

4.91%

4.50%

4.18%

4.21%

4.24%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

3.17%

2.57%

2.47%

2.55%

2.59%

2.56%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%

Total expenses

3.17%6

2.57%6

2.47%6

2.55%6

2.59%6

2.56%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

1.86%

1.85%

1.76%

1.91%

1.94%

1.85%

Portfolio turnover rate7

127%

56%

71%

89%

54%

67%

34 INVESCO HIGH YIELD BOND FACTOR FUND

1.Represents the last business day of the Fund's reporting period.

2.Calculated based on the average shares outstanding during the period.

3.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.

4.Annualized for periods less than one full year.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Nine Months Ended February 29, 2020

3.18%

Year Ended May 31, 2019

2.57%

Year Ended May 31, 2018

2.47%

Year Ended May 31, 2017

2.55%

Year Ended May 31, 2016

2.60%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

See accompanying Notes to Consolidated Financial Statements.

35 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED FINANCIAL HIGHLIGHTS Continued

 

Nine Months

 

 

 

 

 

 

Ended

Year Ended

Year Ended

Year Ended

Year Ended

Year Ended

Class R

February 29,

May 31,

May 31,

May 31,

May 31,

May 29,

2020

2019

2018

2017

2016

20151

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$8.96

$9.17

$9.51

$9.07

$9.75

$10.25

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income2

0.31

0.48

0.47

0.44

0.42

0.46

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.03

(0.20)

(0.34)

0.43

(0.67)

(0.50)

Total from investment

 

 

 

 

 

 

operations

0.34

0.28

0.13

0.87

(0.25)

(0.04)

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.29)

(0.49)

(0.47)

(0.43)

(0.43)

(0.46)

Tax return of capital

 

 

 

 

 

 

distribution

(0.02)

0.00

0.00

0.00

0.00

0.00

Total dividends and/or

 

 

 

 

 

 

distributions to shareholders

(0.31)

(0.49)

(0.47)

(0.43)

(0.43)

(0.46)

Net asset value, end of period

$8.99

$8.96

$9.17

$9.51

$9.07

$9.75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value3

3.85%

3.17%

1.36%

9.81%

(2.46)%

(0.31)%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$3,098

$2,839

$2,185

$1,542

$554

$379

Average net assets (in

 

 

 

 

 

 

thousands)

$3,001

$2,445

$1,873

$908

$447

$234

Ratios to average net assets:4

 

 

 

 

 

 

Net investment income

4.48%

5.36%

4.96%

4.66%

4.65%

4.68%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

2.67%

2.20%

2.07%

2.39%

2.37%

2.45%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%

Total expenses

2.67%6

2.20%6

2.07%6

2.39%6

2.37%6

2.45%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

1.40%

1.40%

1.31%

1.46%

1.49%

1.39%

Portfolio turnover rate7

127%

56%

71%

89%

54%

67%

E on

36 INVESCO HIGH YIELD BOND FACTOR FUND

1.Represents the last business day of the Fund's reporting period.

2.Calculated based on the average shares outstanding during the period.

3.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.

4.Annualized for periods less than one full year.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Nine Months Ended February 29, 2020

2.68%

Year Ended May 31, 2019

2.20%

Year Ended May 31, 2018

2.07%

Year Ended May 31, 2017

2.39%

Year Ended May 31, 2016

2.38%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

See accompanying Notes to Consolidated Financial Statements.

37 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED FINANCIAL HIGHLIGHTS Continued

 

Nine Months

 

 

 

 

 

 

Ended

Year Ended

Year Ended

Year Ended

Year Ended

Year Ended

Class Y

February 29,

May 31,

May 31,

May 31,

May 31,

May 29,

2020

2019

2018

2017

2016

20151

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$8.97

$9.17

$9.51

$9.07

$9.75

$10.25

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income2

0.34

0.53

0.52

0.48

0.47

0.52

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.03

(0.19)

(0.34)

0.45

(0.67)

(0.50)

Total from investment

 

 

 

 

 

 

operations

0.37

0.34

0.18

0.93

(0.20)

0.02

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.33)

(0.54)

(0.52)

(0.49)

(0.48)

(0.52)

Tax return of capital

 

 

 

 

 

 

distribution

(0.02)

0.00

0.00

0.00

0.00

0.00

Total dividends and/or

 

 

 

 

 

 

distributions to shareholders

(0.35)

(0.54)

(0.52)

(0.49)

(0.48)

(0.52)

Net asset value, end of period

$8.99

$8.97

$9.17

$9.51

$9.07

$9.75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value3

4.16%

3.85%

1.92%

10.41%

(1.92)%

0.23%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$1,105

$1,505

$1,534

$2,235

$657

$1,132

Average net assets (in

 

 

 

 

 

 

thousands)

$1,185

$1,411

$1,976

$1,068

$707

$724

Ratios to average net assets:4

 

 

 

 

 

 

Net investment income

5.01%

5.91%

5.50%

5.18%

5.18%

5.25%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

2.17%

1.50%

1.44%

1.42%

1.50%

1.50%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%

Total expenses

2.17%6

1.50%6

1.44%6

1.42%6

1.50%6

1.50%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

0.87%

0.85%

0.76%

0.91%

0.94%

0.84%

Portfolio turnover rate7

127%

56%

71%

89%

54%

67%

38 INVESCO HIGH YIELD BOND FACTOR FUND

1.Represents the last business day of the Fund's reporting period.

2.Calculated based on the average shares outstanding during the period.

3.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.

4.Annualized for periods less than one full year.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Nine Months Ended February 29, 2020

2.18%

Year Ended May 31, 2019

1.50%

Year Ended May 31, 2018

1.44%

Year Ended May 31, 2017

1.42%

Year Ended May 31, 2016

1.51%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

See accompanying Notes to Consolidated Financial Statements.

39 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED FINANCIAL HIGHLIGHTS Continued

 

Nine Months

 

 

Ended

Period

Class R5

February 29,

Ended

2020 May 31, 20191

Per Share Operating Data

 

 

Net asset value, beginning of

 

 

period

$8.97

$9.02

Income (loss) from investment

 

 

operations:

 

 

Net investment income2

0.34

0.01

Net realized and unrealized

 

 

gain (loss)

0.03

(0.06)

Total from investment

 

 

operations

0.37

(0.05)

Dividends and/or distributions

 

 

to shareholders:

 

 

Dividends from net investment

 

 

income

(0.33)

(0.00)3

Tax return of capital

 

 

distribution

(0.02)

0.00

Total dividends and/or

 

 

distributions to shareholders

(0.35)

(0.00)3

Net asset value, end of period

$8.99

$8.97

 

 

 

 

 

 

Total Return, at Net Asset

 

 

Value4

4.16%

3.48%

 

 

 

Ratios/Supplemental Data

 

 

Net assets, end of period (in

 

 

thousands)

$10

$10

Average net assets (in

 

 

thousands)

$10

$10

Ratios to average net assets:5

 

 

Net investment income

5.02%

5.91%

Expenses excluding specific

 

 

expenses listed below

1.84%

1.22%

Interest and fees from

 

 

borrowings

0.00%

0.00%

Total expenses6

1.84%

1.22%

Expenses after payments,

 

 

waivers and/or

 

 

reimbursements and reduction

 

 

to custodian expenses

0.85%

0.85%

Portfolio turnover rate7

127%

56%

40 INVESCO HIGH YIELD BOND FACTOR FUND

1.For the period from after the close of business on May 24, 2019 (inception of offering) to May 31, 2019.

2.Calculated based on the average shares outstanding during the period.

3.Less than $0.005 per share.

4.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.

5.Annualized for periods less than one full year.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Nine Months Ended February 29, 2020

1.85%

Period Ended May 31, 2019

1.22%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

See accompanying Notes to Consolidated Financial Statements.

41 INVESCO HIGH YIELD BOND FACTOR FUND

CONSOLIDATED FINANCIAL HIGHLIGHTS Continued

 

Nine Months

 

 

 

 

 

 

Ended

Year Ended

Year Ended

Year Ended

Year Ended

Year Ended

Class R6

February 29,

May 31,

May 31,

May 31,

May 31,

May 29,

2020

2019

2018

2017

2016

20151

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$8.97

$9.16

$9.50

$9.07

$9.75

$10.25

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income2

0.35

0.54

0.52

0.48

0.47

0.49

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.04

(0.19)

(0.33)

0.44

(0.67)

(0.47)

Total from investment

 

 

 

 

 

 

operations

0.39

0.35

0.19

0.92

(0.20)

0.02

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.34)

(0.54)

(0.53)

(0.49)

(0.48)

(0.52)

Tax return of capital

 

 

 

 

 

 

distribution

(0.02)

0.00

0.00

0.00

0.00

0.00

Total dividends and/or

 

 

 

 

 

 

distributions to shareholders

(0.36)

(0.54)

(0.53)

(0.49)

(0.48)

(0.52)

Net asset value, end of period

$9.00

$8.97

$9.16

$9.50

$9.07

$9.75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value3

4.32%

3.98%

1.97%

10.34%

(1.87)%

0.28%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$110

$123

$13,165

$9,843

$22,186

$15,272

Average net assets (in

 

 

 

 

 

 

thousands)

$103

$6,395

$12,892

$16,472

$20,034

$7,400

Ratios to average net assets:4

 

 

 

 

 

 

Net investment income

5.05%

5.96%

5.56%

5.12%

5.26%

5.13%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

1.81%

1.31%

1.24%

1.18%

1.27%

1.07%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%

Total expenses

1.81%6

1.31%6

1.24%6

1.18%6

1.27%6

1.07%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

0.82%

0.80%

0.71%

0.86%

0.89%

0.80%

Portfolio turnover rate7

127%

56%

71%

89%

54%

67%

42 INVESCO HIGH YIELD BOND FACTOR FUND

1.Represents the last business day of the Fund's reporting period.

2.Calculated based on the average shares outstanding during the period.

3.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.

4.Annualized for periods less than one full year.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Nine Months Ended February 29, 2020

1.82%

Year Ended May 31, 2019

1.31%

Year Ended May 31, 2018

1.24%

Year Ended May 31, 2017

1.18%

Year Ended May 31, 2016

1.28%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

See accompanying Notes to Consolidated Financial Statements.

43 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS February 29, 2020

Note 1 - Significant Accounting Policies

Invesco High Yield Bond Factor Fund (the "Fund"), formerly Invesco Oppenheimer Global High Yield Fund is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities 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 consolidated financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of such Fund or each class.

Prior to the close of business on May 24, 2019, the Fund operated as Oppenheimer Global High Yield Fund (the "Acquired Fund" or "Predecessor Fund"). The Acquired Fund was reorganized after the close of business on May 24, 2019 (the "Reorganization Date") through the transfer of all of its assets and liabilities to the Fund (the "Reorganization").

Prior to February 28, 2020, the Fund sought to gain exposure to Regulation S securities primarily through investments in the Invesco Oppenheimer Global High Yield Fund (Cayman) Ltd. (the "Subsidiary"), a wholly-owned and controlled subsidiary by the Fund organized under the laws of the Cayman Islands. The Subsidiary was organized by the Fund to invest in Regulation S securities. The Fund may invest up to 25% of its total assets in the Subsidiary under its previous strategy. Effective February 28, 2020 the Fund no longer invests in Regulation S securities or the Subsidiary, and the Subsidiary was liquidated.

Effective August 31, 2019 the Fund's fiscal year end changed from May 31 to the last day of February.

The Fund's investment objective is to seek total return.

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 and 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.

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 consolidated financial statements.

A. Security Valuations - Securities, including restricted securities, are valued according to the following policy.

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

44 INVESCO HIGH YIELD BOND FACTOR FUND

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.

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.

Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.

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

45 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

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 economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the consolidated 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 the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Paydown gains and losses on mortgage and asset-backed securities are recorded as adjustments to interest income. Dividend

46 INVESCO HIGH YIELD BOND FACTOR FUND

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 Consolidated 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 transactions reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Consolidated 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 Consolidated Statement of Operations and the Consolidated 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 Consolidated 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 Consolidated 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.

D. Distributions - Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from accounting principles generally accepted in the United States of America ("GAAP"), are recorded on the ex-dividend date. Income distributions, if any, are declared and paid monthly. Capital gain distributions, if any, are declared and paid annually or at other times as determined necessary by the Adviser.

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 consolidated financial statements.

The Fund recognizes the tax benefits of uncertain tax positions only when the position is

47 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

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 Subsidiary is classified as a controlled foreign corporation under Subchapter N of the Internal Revenue Code. Therefore, the Fund is required to increase its taxable income by its share of the Subsidiary's income. Net investment losses of the Subsidiary cannot be deducted by the Fund in the current period nor carried forward to offset taxable income in future periods.

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 consolidated financial statements are prepared on a basis in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated 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. The accompanying consolidated financial statements reflect the financial position of the Fund and its Subsidiary and the results of operations on a consolidated basis. All inter-company accounts and transactions have been eliminated in consolidation. 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 consolidated financial statements are released to print.

H. Indemnifications - Under the Trust's organizational documents, each Trustee, officer, employee or other agent of the Trust, and under the Subsidiary's organizational documents, the directors and officers of the Subsidiary, are indemnified against certain liabilities

that may arise out of the performance of their duties to the Fund and/or the Subsidiary, respectively. 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

48 INVESCO HIGH YIELD BOND FACTOR FUND

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 Consolidated 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 Consolidated 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 Consolidated 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 Consolidated Statement of

Assets and Liabilities.

K.Futures - The Fund may enter into futures contracts to manage exposure to interest

49 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

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 Consolidated 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 Consolidated 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 Consolidated Statement of Assets and Liabilities.

L. 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

50 INVESCO HIGH YIELD BOND FACTOR FUND

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 Consolidated Schedule of Investments and cash deposited is recorded on the Consolidated 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 Consolidated 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 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

51 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

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.

Changes in the value of centrally cleared and OTC swap agreements are recognized as unrealized gains (losses) in the Consolidated 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 Consolidated 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 Consolidated Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Consolidated 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 Consolidated 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 Consolidated 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. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund's exposure is unlimited.

M. Put Options Purchased and Written - The Fund may purchase and write put options including options on securities indexes, or foreign currency and/or futures contracts. By purchasing a put option, the Fund obtains the right (but not the obligation) to sell the option's underlying instrument at a fixed strike price. In return for this right, the Fund pays an option premium. The option's underlying instrument may be a security, securities index, or a futures contract.

52 INVESCO HIGH YIELD BOND FACTOR FUND

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.

Put options may be used by the Fund to hedge securities it owns by locking in a minimum price at which the Fund can sell. If security prices fall, the put option could be exercised to offset all or a portion of the Fund's resulting losses. At the same time, because the maximum the Fund has at risk is the cost of the option, purchasing put options does not eliminate the potential for the Fund to profit from an increase in the value of the underlying portfolio securities. The Fund may write put options to earn additional income in the form of option premiums if it expects the price of the underlying instrument to remain stable

or rise during the option period so that the option will not be exercised. The risk in this strategy is that the price of the underlying securities may decline by an amount greater than the premium received. Put options written are reported as a liability in the Consolidated Statement of Assets and Liabilities. Realized and unrealized gains and losses on put options purchased and put options written are included in the Consolidated Statement

of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities and Option contracts written, respectively. 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.

N. 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 Consolidated 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

53 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

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 Consolidated 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 Consolidated 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 Consolidated 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.

O. Securities on a When-Issued or Delayed Delivery Basis - The Fund may purchase securities on a "when-issued" basis, and may purchase or sell securities on a "delayed delivery" basis, with payment and delivery scheduled for a future date. No income accrues to the Fund on the securities in connection with such transactions prior to the date the Fund actually takes delivery of the securities. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention on acquiring such securities, they may sell such securities prior to the settlement date.

P. Other Risks - The Fund may invest in lower-quality debt securities, i.e., "junk bonds". Investments in lower-rated securities or unrated securities of comparable quality tend to be more sensitive to economic conditions than higher rated securities. Junk bonds involve a greater risk of default by the issuer because such securities are generally unsecured and are often subordinated to other creditors' claim. Prior to its repositioning, the Fund gained exposure to Regulation S securities primarily through an investment in the Subsidiary. Regulation S securities may be relatively less liquid as a result of legal or contractual restrictions on resale. The Fund is indirectly exposed to the risks associated with the Subsidiary's investments.

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.

54 INVESCO HIGH YIELD BOND FACTOR FUND

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:

Fee Schedule Through February 29, 2020*

 

Fee Schedule Effective February 28, 2020*

Up to $500 million

0.75%

 

Up to $2 billion

0.37%

Next $500 million

0.70

 

Over $2 billion

0.35

Next $3 billion

0.65

 

 

 

Over $4 billion

0.60

 

 

 

*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 nine months ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.74%.

The Subsidiary entered into a separate contract with the Adviser whereby the Adviser provided investment advisory and other services to the Subsidiary. In consideration of these services, the Subsidiary paid an advisory fee to the Adviser based on the annual rate of the Subsidiary's average daily net assets as set forth in the table above through February 28, 2020. Effective February 28, 2020 the contract between the Subsidiary and the Adviser was terminated.

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.

Effective on the Reorganization Date, 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 1.15%, 1.85%, 1.40%, 0.85%, 0.85% and 0.80%, respectively, of the Fund's average daily net assets (the "expense limits"). Effective February 28, 2020, the Fund's expense limitation agreement was amended to reflect a reduction to the Fund's existing expense limits. Under the amended expense limitation agreement, the Adviser has contractually agreed to waive advisory fees and/or reimburse expenses to the extent necessary to limit the Fund's Total Annual Fund Operating Expenses After Fee Waiver and/or

55 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

Expense Reimbursement of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 0.64%, 1.39%, 0.89%, 0.39%, 0.39% and 0.39%, respectively, of the Fund's average daily net assets (the "expense limits") from February 28, 2020 through May 31, 2021. 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; (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 on May 31, 2021. 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, 2021, 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 nine months ended February 29, 2020, the Adviser waived advisory fees of $4,496 and reimbursed fund expenses of $215,889, $56,625, $28,168, $11,337, $74 and $748 for Class A, Class C, Class R, Class Y, Class R5 and Class R6, 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 nine months ended February 29, 2020, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Administration fees. Additionally, Invesco has entered into service agreements whereby JPMorgan Chase Bank serves as custodian to the Fund. Prior to the Reorganization, the Acquired Fund paid administrative fees to OFI Global Asset Management, Inc.

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 nine months ended February 29, 2020, expenses incurred under these agreements are shown in the Consolidated Statement of Operations as Transfer and shareholder servicing 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 "Plan"). The Fund, pursuant to the Class A Plan, reimbursed IDI in an amount up to an 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

56 INVESCO HIGH YIELD BOND FACTOR FUND

assets of Class C 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 Plan 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 plans. Prior to the Reorganization, the Acquired Fund paid distribution fees to OppenheimerFunds Distributor, Inc. For the nine months ended February 29, 2020, expenses incurred under the plans are shown in the Consolidated Statement of Operations as Distribution and service plan 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 nine months ended February 29, 2020, IDI advised the Fund that IDI retained $5,174 in front-end sales commissions from the sale of Class A shares and $153 from Class C shares for CDSC imposed on 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.

57 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

The following is a summary of the tiered valuation input levels, as of February 29, 2020. 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 consolidated financial statements may materially differ from the value received upon actual sale of those investments.

 

 

 

 

 

 

Level 3—

 

 

 

Level 1—

 

Level 2—

 

Significant

 

 

 

Unadjusted

 

Other Significant

 

Unobservable

 

 

 

Quoted Prices

 

Observable Inputs

 

Inputs

Value

Assets Table

 

 

 

 

 

 

 

Investments, at Value:

 

 

 

 

 

 

 

Asset-Backed Security

$

— $

249,684

$

— $

249,684

Foreign Government Obligations

 

 

615,615

 

615,615

Corporate Loans

 

 

36,433

 

36,433

Corporate Bonds and Notes

 

 

30,591,900

 

30,591,900

Preferred Stock

 

 

875

 

875

Common Stocks

 

 

11,000

 

11,000

Rights, Warrants and Certificates

 

 

 

Investment Companies

 

2,555,798

 

 

2,555,798

Total Investments, at Value

 

2,555,798

 

31,505,507

 

34,061,305

Other Financial Instruments:

 

 

 

 

 

 

 

Futures contracts

 

39,216

 

 

39,216

Forward currency exchange contracts

 

 

64

 

64

Total Assets

$

2,595,014

$

31,505,571

$

— $

34,100,585

Liabilities Table

 

 

 

 

 

 

 

Other Financial Instruments:

 

 

 

 

 

 

 

Futures contracts

$

(17,294)

$

— $

— $

(17,294)

Forward currency exchange contracts

 

 

(3,982)

 

(3,982)

Total Liabilities

$

(17,294)

$

(3,982)

$

— $

(21,276)

Forward currency exchange contracts and futures contracts, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract's value from trade date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

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 Consolidated Statement of Assets and Liabilities.

58 INVESCO HIGH YIELD BOND FACTOR FUND

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 asset transactions as of February 29, 2020:

 

 

 

Gross Amounts Not Offset in the Consolidated

 

 

 

 

 

Statement of Assets & Liabilities

 

 

 

Gross Amounts

 

 

 

 

 

 

 

Not Offset in the

 

 

 

 

 

 

 

 

Consolidated

 

Financial

Financial

 

 

 

 

 

Statement

 

Instruments

Instruments

 

 

 

 

 

of Assets &

 

Available for

Collateral Cash Collateral

 

Counterparty

 

Liabilities*

 

Offset

Received**

Received**

Net Amount

Citibank NA.

$

64

$

– $

– $

– $

64

*OTC derivatives are reported gross on the Consolidated Statement of Assets and Liabilities. Exchange traded options and margin related to centrally cleared swaps and futures, if any, are excluded from these reported amounts. **Reported collateral posted for the benefit of the Fund within this table is limited to the net outstanding amount due from an individual counterparty. The collateral posted for the benefit of the Fund may exceed these amounts.

The table below reflects the Fund's exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative liability transactions as of February 29, 2020:

 

 

 

Gross Amounts Not Offset in the Consolidated

 

 

 

 

 

Statement of Assets & Liabilities

 

 

 

Gross Amounts

 

 

 

 

 

 

 

Not Offset in the

 

 

 

 

 

 

 

 

Consolidated

 

Financial

Financial

 

 

 

 

 

Statement

 

Instruments

Instruments

 

 

 

 

 

of Assets &

 

Available for

Collateral Cash Collateral

 

Counterparty

 

Liabilities*

 

Offset

Pledged**

Pledged**

Net Amount

RBC Dominion

 

 

 

 

 

 

 

 

Securities

$

(3,982)

$

– $

– $

– $

(3,982)

*OTC derivatives are reported gross on the Consolidated Statement of Assets and Liabilities. Exchange traded options and margin related to centrally cleared swaps and futures, if any, are excluded from these reported amounts. **Reported collateral pledged within this table is limited to the net outstanding amount due from the Fund. The securities pledged as collateral by the Fund as reported on the Consolidated Schedule of Investments may exceed these amounts.

Value of Derivative Instruments at Period-End

The table below summarizes the value of the Fund's derivative investments, detailed by primary risk exposure, held as of February 29, 2020:

59 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

 

Asset Derivatives

 

 

 

Liability Derivatives

 

 

 

Consolidated

 

 

 

Consolidated

 

 

 

Statement of Assets

 

 

 

Statement of Assets

 

 

 

and Liabilities Location

 

Value

 

and Liabilities Location

 

Value

Interest rate contracts Futures contracts

$

39,216*

 

Futures contracts

$

17,294*

 

Unrealized appreciation on

 

 

 

Unrealized depreciation on

 

 

Forward currency

forward currency exchange

 

 

 

forward currency exchange

 

 

exchange contracts

contracts

 

64

 

contracts

 

3,982

Derivative Assets/

 

 

 

 

 

 

 

Liabilities not subject

 

 

 

 

 

 

 

to master netting

 

 

 

 

 

 

 

agreements

 

 

(39,216)

 

 

 

(17,294)

Total Derivative

 

 

 

 

 

 

 

Assets/Liabilities

 

 

 

 

 

 

 

subject to master

 

$

64

 

 

$

3,982

netting agreements

 

 

 

 

 

 

 

 

 

 

 

*Includes only the current day's variation margin. Prior variation margin movements have been reflected in cash on the Consolidated Statement of Assets and Liabilities upon receipt or payment.

Effect of Derivative Investments for the Nine Months Ended February 29, 2020

The tables below summarize the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:

Amount of Realized Gain or (Loss) Recognized on Derivatives

Derivatives

 

 

 

Investment

 

 

 

 

Not Accounted

 

 

 

transactions

 

Swaption

 

 

for as Hedging

 

 

 

in unaffiliated

 

contracts

 

Futures

Instruments

 

 

 

companies*

 

written

 

contracts

Credit contracts

$

(5,365)

$

2,465

$

Forward currency

 

 

 

 

 

 

 

 

exchange contracts

 

 

 

 

 

Interest rate contracts

 

 

 

 

 

92,875

Total

$

(5,365)

$

2,465

$

92,875

 

 

 

 

 

 

 

 

 

 

 

 

 

Amount of Realized Gain or (Loss) Recognized on Derivatives

 

 

Derivatives

 

 

 

Forward

 

 

 

 

Not Accounted

 

 

 

currency

 

 

 

 

for as Hedging

 

 

 

exchange

 

 

 

 

Instruments

 

 

 

contracts Swap contracts

 

Total

Credit contracts

$

$

(7,497)

$

(10,397)

Forward currency

 

 

 

 

 

 

 

 

exchange contracts

 

 

 

926

 

 

926

Interest rate contracts

 

 

 

 

 

92,875

Total

$

926

$

(7,497)

$

83,404

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

60 INVESCO HIGH YIELD BOND FACTOR FUND

Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives

Derivatives

 

 

 

Forward

 

 

Not Accounted

 

 

 

currency

 

 

for as Hedging

 

Futures

 

exchange

 

 

Instruments

 

contracts

 

contracts

 

Total

Forward currency

 

 

 

 

 

 

exchange contracts

$

$

(3,918)

$

(3,918)

Interest rate contracts

 

21,922

 

 

21,922

Total

$

21,922

$

(3,918)

$

18,004

 

 

 

 

 

 

 

*Includes purchased option contracts and purchased swaption contracts, if any.

The table below summarizes the two months ended average notional value of forward foreign currency contracts, five months ended average notional value of futures contracts, four months ended average notional value of swap agreements and the three months ended average notional value of swaptions purchased and written during the period.

 

 

Forward

 

 

 

 

 

 

 

 

 

 

foreign

 

 

 

 

 

 

 

 

 

 

currency

 

Futures

 

 

 

Swaptions

 

Swaptions

 

 

contracts

 

contracts

 

Swaps

 

written

 

purchased

Average notional

$

 

 

 

 

 

 

 

 

2,900,000

amount

2,186,914

$

5,254,496

$

917,250

$

2,900,000

$

Note 5 - Trustee and Officer Fees and Benefits

Certain Trustees have executed Deferred Compensation Agreement(s) pursuant to which they have the option to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from the Fund. For purposes of determining the amount owed to the Trustees under the plan(s), deferred amounts are treated as though equal dollar amounts had been invested in shares of the Fund or in other Invesco and/or Invesco Oppenheimer funds selected by the Trustees. The Fund purchases shares of the funds selected for deferral by the Trustees in amounts equal to his or her deemed investment, resulting in a Fund asset equal to the deferred compensation liability. Such assets are included as a component of "Other" within the asset section of the Consolidated Statement of Assets and Liabilities. Deferral

of Trustees' fees under the plan(s) will not affect the net assets of the Fund and will not materially affect the Fund's assets, liabilities or net investment income per share. Amounts will be deferred until distributed in accordance with the Deferred Compensation Agreement(s).

Note 6 - Cash Balances

The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with JPMorgan Chase Bank, the custodian bank. Such balances, if any at period-end, are shown in the Consolidated 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

61 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

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.

Note 7 - Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders for the Nine Months Ended February 29, 2020 and the Fiscal Years Ended May 31, 2019 and May 31, 2018:

 

 

February 29,

 

 

 

 

 

 

2020

 

May 31, 2019

 

May 31, 2018

Ordinary income

$

1,127,423

$

2,161,079

$

2,452,895

Return of capital

 

59,088

 

 

Total

$

1,186,511

$

2,161,079

$

2,452,895

 

 

 

 

 

 

 

Tax Components of Net Assets at Period-End:

 

 

2020

Net unrealized appreciation (depreciation) - investments

$

(854,751)

Net unrealized appreciation (depreciation) - foreign currencies

 

(6,476)

Temporary book/tax differences

 

(12,329)

Capital loss carryforward

 

(3,757,474)

Shares of beneficial interest

 

38,118,156

Total net assets

$

33,487,126

 

 

 

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to derivative investments, wash sales and paid-in-kind securities.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.

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 has a capital loss carryforward as of February 29, 2020, which expires as follows:

Capital Loss Carryforward*

Expiration

Short-Term

 

Long-Term

 

Total

Not subject to expiration $

1,134,049

$

2,623,425

$

3,757,474

*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.

62 INVESCO HIGH YIELD BOND FACTOR FUND

Note 8 - Investment Transactions

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the nine months ended February 29, 2020 was $40,569,384 and $40,082,447, 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

$

447,411

Aggregate unrealized (depreciation) of investments

 

(1,308,638)

Net unrealized depreciation of investments

$

(861,227)

 

 

 

Cost of investments for tax purposes is $37,656,501.

Note 9 - Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of foreign currency transactions, income from the subsidiary, return of capital distributions and swap agreements income, on February 29, 2020, undistributed net investment loss was decreased by $67,456, undistributed net realized loss was decreased by $10,506 and shares of beneficial interest was decreased by $77,962. This reclassification had no effect on the net assets of the Fund.

Note 10 - Share Information

Transactions in shares of beneficial interest were as follows:

 

Nine Months Ended

Year Ended May 31, 20192

Year Ended May 31, 2018

 

February 29, 20201

 

 

 

 

 

 

 

 

Shares

 

Amount

Shares

 

Amount

Shares

 

Amount

Class A

 

 

 

 

 

 

 

 

 

Sold

422,846

$

3,857,665

729,132

$

6,596,376

857,228

$

8,111,482

Automatic

 

 

 

 

 

 

 

 

 

Conversion

 

 

 

 

 

 

 

 

 

Class C

 

 

 

 

 

 

 

 

 

to Class A

 

 

 

 

 

 

 

 

 

Shares

88,060

 

804,928

 

 

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

84,797

 

771,421

127,447

 

1,146,812

111,259

 

1,046,849

Redeemed

(529,837)

 

(4,822,179)

(677,300)

 

(6,083,049)

(1,484,461)

 

(14,070,186)

Net increase

65,866

$

611,835

179,279

$

1,660,139

(515,974)

$

(4,911,855)

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

63 INVESCO HIGH YIELD BOND FACTOR FUND

NOTES TO

CONSOLIDATED FINANCIAL STATEMENTS Continued

 

Nine Months Ended

Year Ended May 31, 20192

Year Ended May 31, 2018

 

February 29, 20201

 

 

 

 

 

 

 

 

Shares

 

Amount

Shares

 

Amount

Shares

 

Amount

Class C

 

 

 

 

 

 

 

 

 

Sold

95,431

$

869,158

244,929

$

2,206,607

247,079

$

2,333,787

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

19,060

 

173,379

34,682

 

312,156

33,599

 

315,893

Automatic

 

 

 

 

 

 

 

 

 

Conversion

(88,146)

 

(804,928)

 

 

Class C

 

 

 

to Class A

 

 

 

 

 

 

 

 

 

Shares

 

 

 

 

 

 

 

 

 

Redeemed

(113,532)

 

(1,034,585)

(316,686)

 

(2,850,680)

(263,832)

 

(2,476,239)

Net increase

(87,187)

$

(796,976)

(37,075)

$

(331,917)

16,846

$

173,441

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class R

 

 

 

 

 

 

 

 

 

Sold

78,933

$

719,034

111,688

$

1,004,611

108,686

$

1,023,948

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

11,232

 

102,255

14,608

 

131,453

9,869

 

92,780

Redeemed

(62,196)

 

(566,678)

(47,888)

 

(432,836)

(42,489)

 

(400,105)

Net increase

27,969

$

254,611

78,408

$

703,228

76,066

$

716,623

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class Y

 

 

 

 

 

 

 

 

 

Sold

39,704

$

362,919

48,786

$

440,005

121,034

$

1,149,347

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

4,971

 

45,278

9,355

 

84,298

11,527

 

108,676

Redeemed

(89,562)

 

(816,478)

(57,586)

 

(517,066)

(200,347)

 

(1,895,008)

Net increase

(44,887)

$

(408,281)

555

$

7,237

(67,786)

$

(636,985)

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class R53

 

 

 

 

 

 

 

 

 

Sold

$

1,109

$

10,000

$

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

 

 

 

Redeemed

 

 

 

Net increase

$

1,109

$

10,000

$

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

64 INVESCO HIGH YIELD BOND FACTOR FUND

 

Nine Months Ended

Year Ended May 31, 20192

Year Ended May 31, 2018

 

February 29, 20201

 

 

 

 

 

 

 

 

Shares

 

Amount

Shares

 

Amount

Shares

 

Amount

Class R6

 

 

 

 

 

 

 

 

 

Sold

5,734

$

52,385

13,344

$

121,038

399,752

$

3,793,311

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

445

 

4,054

41,562

 

373,633

76,854

 

722,544

Redeemed

(7,678)

 

(70,066)

(1,477,674)

 

(13,251,520)

(75,738)

 

(698,308)

Net increase

(1,499)

$

(13,627)

(1,422,768)

$

(12,756,849)

400,868

$

3,817,547

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.There are entities that are record owners of more than 5% of the outstanding shares of the Fund and own 21% 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.

2.There are entities that are record owners of more than 5% of the outstanding shares of the Fund and own 21% 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.

3.Commencement date after the close of business on May 24, 2019.

Note 11 - Subsequent Event

During the first quarter of 2020, the World Health Organization declared the Coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Funds' ability to achieve their investment objectives. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Act is a $2 trillion stimulus package to help individuals, businesses and hospitals in response to the economic distress caused by the COVID-19 crisis. The Adviser is assessing the components of the Act and the impacts to the Fund should be immaterial.

65 INVESCO HIGH YIELD BOND FACTOR FUND

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco High Yield Bond Factor Fund

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statement of assets and liabilities, including the consolidated schedule of investments, of Invesco High Yield Bond Factor Fund and its subsidiary, formerly Invesco Oppenheimer Global High Yield Fund, (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), referred to hereafter as the "Fund") as of February 29, 2020, the related consolidated statements of operations and of changes in net assets, including the related notes, and the consolidated financial highlights for each of the periods indicated in the table below (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations, the changes in its net assets and the financial highlights for each of the periods indicated in the table below, in conformity with accounting principles generally accepted in the United States of America.

Consolidated Statement of Operations and

 

Consolidated Statement of Changes in Net

 

Assets

Consolidated Financial Highlights

 

 

For the period from June 1, 2019 through February

For the period from June 1, 2019 through February

29, 2020 and the year ended May 31, 2019

29, 2020 and the year ended May 31, 2019 for

 

Class A, Class C, Class R, Class Y and Class R6

 

For the period from June 1, 2019 through February

 

29, 2020 and the period from May 24, 2019

 

(inception of offering) through May 31, 2019 for

 

Class R5

The consolidated financial statements of Invesco High Yield Bond Factor Fund (formerly Oppenheimer Global High Yield Fund) as of and for the year ended May 31, 2018 and the consolidated financial highlights for each of the periods ended on or prior to May 31, 2018 (not presented herein, other than the consolidated statement of changes in net assets and the consolidated financial highlights) were audited by other auditors whose report dated July 25, 2018 expressed an unqualified opinion on those consolidated financial statements and consolidated financial highlights.

Basis for Opinion

These consolidated financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable

66 INVESCO HIGH YIELD BOND FACTOR FUND

assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP Houston, Texas

April 28, 2020

We have served as the auditor of one or more investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

67 INVESCO HIGH YIELD BOND FACTOR FUND

TAX INFORMATION Unaudited

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its nine months ended February 29, 2020:

Federal and State Income Tax

 

Qualified Dividend Income*

0.81 %

Corporate Dividends Received Deduction*

0.13 %

Qualified Business Income

0.00 %

U.S. Treasury Obligations*

0.00 %

Tax-Exempt Interest Dividends*

0.00 %

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

68 INVESCO HIGH YIELD BOND FACTOR FUND

PORTFOLIO PROXY VOTING POLICIES AND GUIDELINES; UPDATES TO SCHEDULE OF INVESTMENTS Unaudited

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 holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 Forms N-PORT on the SEC website at sec.gov.

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/proxyguidelines. 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. The 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.

69 INVESCO HIGH YIELD BOND FACTOR FUND

TRUSTEES AND OFFICERS Unaudited

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

INTERESTED TRUSTEE

 

 

 

 

 

 

 

 

 

Martin L. Flanagan 1 — 1960

2007

Executive Director, Chief Executive Officer and

229

None

Trustee and Vice Chair

 

President, Invesco Ltd. (ultimate parent of

 

 

 

 

Invesco and a global investment management

 

 

 

 

firm); Trustee and Vice Chair, The Invesco

 

 

 

 

Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board,

 

 

 

 

SMU Cox School of Business

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer, Invesco Advisers, Inc. (registered investment adviser); Director, Chairman, Chief Executive Officer and President, Invesco Holding Company (US), Inc. (formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service provider) and Invesco North American Holdings, Inc. (holding company); Director, Chief Executive Officer and President, Invesco Holding Company Limited (parent of Invesco and a global investment management firm); Director, Invesco Ltd.; Chairman, Investment Company Institute and President, Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief Financial Officer, Franklin Resources, Inc. (global investment management organization)

1 Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

70 INVESCO HIGH YIELD BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

INDEPENDENT TRUSTEES

Bruce L. Crockett – 1944

2003 Chairman, Crockett Technologies Associates

Trustee and Chair

(technology consulting company)

 

Formerly: Director, Captaris (unified

 

messaging provider); Director, President and

 

Chief Executive Officer, COMSAT Corporation;

 

Chairman, Board of Governors of INTELSAT

 

(international communications company); ACE

 

Limited (insurance company); Independent

 

Directors Council and Investment Company

 

Institute: Member of the Audit Committee,

 

Investment Company Institute; Member of

 

the Executive Committee and Chair of the

 

Governance Committee, Independent Directors

 

Council

229Director and

Chairman of the

Audit Committee,

ALPS (Attorneys

Liability Protection Society) (insurance company); Director and Member of the Audit Committee and Compensation

Committee, Ferroglobe

PLC (metallurgical

company)

David C. Arch – 1945

2010 Chairman of Blistex Inc. (consumer health

229

Board member of the

Trustee

care products manufacturer); Member, World

 

Illinois Manufacturers'

 

Presidents' Organization

 

Association

 

 

 

 

Beth Ann Brown – 1968

2019 Independent Consultant

229

Director, Board of

Trustee

Formerly: Head of Intermediary Distribution,

 

Directors of Caron

 

 

Engineering Inc.;

 

Managing Director, Strategic Relations,

 

Advisor, Board of

 

Managing Director, Head of National

 

Advisors of Caron

 

Accounts, Senior Vice President, National

 

Engineering Inc.;

 

Account Manager and Senior Vice President,

 

President and

 

Key Account Manager, Columbia Management

 

Director, of Acton

 

Investment Advisers LLC; Vice President, Key

 

Shapleigh Youth

 

Account Manager, Liberty Funds Distributor,

 

Conservation Corps

 

Inc.; and Trustee of certain Oppenheimer

 

(non -profit); and

 

Funds

 

President and Director

 

 

 

of Grahamtastic

 

 

 

Connection (non-

 

 

 

profit)

Jack M. Fields – 1952

2003 Chief Executive Officer, Twenty First Century

Trustee

Group, Inc. (government affairs company);

 

and Chairman, Discovery Learning Alliance

 

(non-profit)

 

Formerly: Owner and Chief Executive Officer,

 

Dos Angeles Ranch L.P. (cattle, hunting,

 

corporate entertainment); Director, Insperity,

 

Inc. (formerly known as Administaff) (human

 

resources provider); Chief Executive Officer,

 

Texana Timber LP (sustainable forestry

 

company); Director of Cross Timbers Quail

 

Research Ranch (non-profit); and member of

 

the U.S. House of Representatives

229Member, Board of Directors of Baylor

College of Medicine

71 INVESCO HIGH YIELD BOND FACTOR FUND

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

INDEPENDENT TRUSTEES (CONTINUED)

Cynthia Hostetler —1962

2017 Non-Executive Director and Trustee of a

Trustee

number of public and private business

 

corporations

 

Formerly: Director, Aberdeen Investment

 

Funds (4 portfolios); Head of Investment

 

Funds and Private Equity, Overseas Private

 

Investment Corporation; President, First

 

Manhattan Bancorporation, Inc.; Attorney,

 

Simpson Thacher & Bartlett LLP

229Vulcan Materials

Company

(construction materials

company); Trilinc Global Impact Fund; Genesee & Wyoming, Inc. (railroads); Artio Global Investment LLC (mutual

fund complex);

Edgen Group, Inc. (specialized energy and infrastructure products distributor); Investment Company Institute (professional organization); Independent Directors Council (professional organization)

Eli Jones – 1961

2016 Professor and Dean, Mays Business School -

229

Insperity, Inc. (formerly

Trustee

Texas A&M University

 

known as Administaff)

 

Formerly: Professor and Dean, Walton College

 

(human resources

 

 

provider)

 

of Business, University of Arkansas and E.J.

 

 

 

Ourso College of Business, Louisiana State

 

 

 

University; Director, Arvest Bank

 

 

Elizabeth Krentzman – 1959

2019 Formerly: Principal and Chief Regulatory

Trustee

Advisor for Asset Management Services and

 

U.S. Mutual Fund Leader of Deloitte & Touche

 

LLP; General Counsel of the Investment

 

Company Institute (trade association);

 

National Director of the Investment

 

Management Regulatory Consulting Practice,

 

Principal, Director and Senior Manager of

 

Deloitte & Touche LLP; Assistant Director of

 

the Division of Investment Management -

 

Office of Disclosure and Investment Adviser

 

Regulation of the U.S. Securities and Exchange

 

Commission and various positions with the

 

Division of Investment Management – Office

 

of Regulatory Policy of the U.S. Securities and

 

Exchange Commission; Associate at Ropes &

 

Gray LLP.; and Trustee of certain Oppenheimer

 

Funds

229Trustee of the

University of Florida

National Board

Foundation; Member of the Cartica Funds Board of Directors (private investment funds); Member of the University of Florida Law Center

Association, Inc. Board

of Trustees and Audit

Committee Member

72 INVESCO HIGH YIELD BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

INDEPENDENT TRUSTEES (CONTINUED)

Anthony J. LaCava, Jr. – 1956 2019

Formerly: Director and Member of the Audit

Trustee

Committee, Blue Hills Bank (publicly traded

 

financial institution) and Managing Partner,

 

KPMG LLP

229Blue Hills Bank;

Chairman of Bentley University; Member, Business School Advisory Council; and Nominating

Committee, KPMG LLP

Prema Mathai-Davis – 1950 2003 Retired229None Trustee

Formerly; Co-Founder & Partner of Quantalytics Research, LLC, (a FinTech Investment Research Platform for the Self- Directed Investor)

Joel W. Motley – 1952

2019 Director of Office of Finance, Federal Home

Trustee

Loan Bank System; Member of the Vestry

 

of Trinity Wall Street; Managing Director of

 

Carmona Motley Hoffman, Inc. (privately held

 

financial advisor); Member of the Council

 

on Foreign Relations and its Finance and

 

Budget Committee; Chairman Emeritus of

 

Board of Human Rights Watch and Member

 

of its Investment Committee; and Member

 

of Investment Committee and Board of

 

Historic Hudson Valley (non-profit cultural

 

organization).

 

Formerly: Managing Director of Public Capital

 

Advisors, LLC (privately held financial advisor);

 

Managing Director of Carmona Motley

 

Hoffman, Inc. (privately held financial advisor);

 

Trustee of certain Oppenheimer Funds; and

 

Director of Columbia Equity Financial Corp.

 

(privately held financial advisor)

229Member of Board of Greenwall Foundation (bioethics research foundation) and

its Investment

Committee; Member of Board of Friends of the LRC (non-profit legal advocacy); Board Member and Investment Committee Member of Pulitzer Center for Crisis

Reporting (non-profit

journalism)

Teresa M. Ressel — 1962

2017 Non-executive director and trustee of a

Trustee

number of public and private business

 

corporations

 

Formerly: Chief Financial Officer, Olayan

 

America, The Olayan Group (international

 

investor/commercial/industrial); Chief

 

Executive Officer, UBS Securities LLC; Group

 

Chief Operating Officer, Americas, UBS AG;

 

Assistant Secretary for Management & Budget

 

and CFO, US Department of the Treasury

229Atlantic Power

Corporation (power

generation company); ON Semiconductor Corp. (semiconductor supplier)

73 INVESCO HIGH YIELD BOND FACTOR FUND

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

INDEPENDENT TRUSTEES

 

 

 

 

(CONTINUED)

 

 

 

 

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston

229

Federal Reserve Bank

Trustee

 

Endowment Inc. (private philanthropic

 

of Dallas

 

 

institution)

 

 

 

 

Formerly: Executive Vice President and

 

 

 

 

General Counsel, Texas Children's Hospital;

 

 

 

 

Attorney, Beck, Redden and Secrest, LLP;

 

 

 

 

Business Law Instructor, University of St.

 

 

 

 

Thomas; Attorney, Andrews & Kurth LLP

 

 

 

 

 

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of

 

 

 

 

 

 

 

 

Denver – Daniels College of Business, Senior

 

 

 

 

Partner, KPMG LLP

 

 

Daniel S. Vandivort –1954

2019 Treasurer, Chairman of the Audit and Finance

Trustee

Committee, and Trustee, Board of Trustees,

 

Huntington Disease Foundation of America;

 

and President, Flyway Advisory Services LLC

 

(consulting and property management).

 

Formerly: Trustee and Governance Chair, of

 

certain Oppenheimer Funds

229Chairman and Lead Independent Director, Chairman of the Audit Committee, and Director, Board of Directors, Value Line Funds

James D. Vaughn – 1945

2019 Retired

Trustee

Formerly: Managing Partner, Deloitte & Touche

 

 

LLP; Trustee and Chairman of the Audit

 

Committee, Schroder Funds; Board Member,

 

Mile High United Way, Boys and Girls Clubs,

 

Boy Scouts, Colorado Business Committee

 

for the Arts, Economic Club of Colorado

 

and Metro Denver Network (economic

 

development corporation); and Trustee of

 

certain Oppenheimer Funds

229Board member

and Chairman of Audit Committee

of AMG National Trust Bank; Trustee and Investment Committee member, University of South Dakota Foundation; Board member, Audit Committee Member and past Board Chair, Junior Achievement (non-profit)

Christopher L. Wilson –

2017 Retired

1957

Formerly: Director, TD Asset Management USA

Trustee, Vice Chair and Chair

Designate

Inc. (mutual fund complex) (22 portfolios);

 

Managing Partner, CT2, LLC (investing and

 

consulting firm); President/Chief Executive

 

Officer, Columbia Funds, Bank of America

 

Corporation; President/Chief Executive Officer,

 

CDC IXIS Asset Management Services, Inc.;

229ISO New England,

Inc. (non-profit

organization

managing regional electricity market)

74 INVESCO HIGH YIELD BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

 

 

 

 

Since

 

 

 

 

 

 

 

 

INDEPENDENT TRUSTEES

 

 

 

 

(CONTINUED)

 

 

 

 

 

 

 

 

 

Christopher L. Wilson

 

Principal & Director of Operations, Scudder

 

 

Continued

 

Funds, Scudder, Stevens & Clark, Inc.; Assistant

 

 

 

 

Vice President, Fidelity Investments

 

 

 

 

 

 

 

75 INVESCO HIGH YIELD BOND FACTOR FUND

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS

 

 

 

 

 

 

 

 

 

Sheri Morris — 1964

2003

Head of Global Fund Services, Invesco Ltd.;

N/A

N/A

President, Principal Executive

 

President, Principal Executive Officer and

 

 

Officer and Treasurer

 

Treasurer, The Invesco Funds; Vice President,

 

 

 

 

Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust,

 

 

 

 

Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-

 

 

 

 

Traded Self-Indexed Fund Trust, and Vice

 

 

 

 

President, OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal

 

 

 

 

Financial Officer, The Invesco Funds; Vice

 

 

 

 

President, Invesco AIM Advisers, Inc., Invesco

 

 

 

 

AIM Capital Management, Inc. and Invesco

 

 

 

 

AIM Private Asset Management, Inc.; Assistant

 

 

 

 

Vice President and Assistant Treasurer, The

 

 

 

 

Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital

 

 

 

 

Management, Inc. and Invesco AIM Private

 

 

 

 

Asset Management, Inc.; and Treasurer,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco

 

 

 

 

Actively Managed Exchange-Traded Fund Trust

 

 

 

 

 

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The

N/A

N/A

Senior Vice President and

 

Invesco Funds

 

 

Senior Officer

 

 

 

 

 

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco

N/A

N/A

Senior Vice President, Chief

 

Ltd.; Senior Vice President and Secretary,

 

 

Legal Officer and Secretary

 

Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President

 

 

 

 

and Secretary, Invesco Distributors, Inc.

 

 

 

 

(formerly known as Invesco AIM Distributors,

 

 

 

 

Inc.); Vice President and Secretary, Invesco

 

 

 

 

Investment Services, Inc. (formerly known

 

 

 

 

as Invesco AIM Investment Services, Inc.)

 

 

 

 

Senior Vice President, Chief Legal Officer and

 

 

 

 

Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers

 

 

 

 

LLC (formerly known as Van Kampen Asset

 

 

 

 

Management); Secretary and General Counsel,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

 

 

 

76 INVESCO HIGH YIELD BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

Jeffrey H. Kupor (Continued)

 

Officer, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco

 

 

 

 

India Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-

 

 

 

 

Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L.

 

 

 

 

Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President,

 

 

 

 

Jemstep, Inc.; Head of Legal, Worldwide

 

 

 

 

Institutional, Invesco Ltd.; Secretary and

 

 

 

 

General Counsel, INVESCO Private Capital

 

 

 

 

Investments, Inc.; Senior Vice President,

 

 

 

 

Secretary and General Counsel, Invesco

 

 

 

 

Management Group, Inc. (formerly known

 

 

 

 

as Invesco AIM Management Group,

 

 

 

 

Inc.); Assistant Secretary, INVESCO Asset

 

 

 

 

Management (Bermuda) Ltd.; Secretary and

 

 

 

 

General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel,

 

 

 

 

INVESCO Realty, Inc.; Secretary and General

 

 

 

 

Counsel, Invesco Senior Secured Management,

 

 

 

 

Inc.; and Secretary, Sovereign G./P. Holdings

 

 

 

 

Inc.

 

 

 

 

 

 

 

Andrew R. Schlossberg –

2019

Head of the Americas and Senior Managing

N/A

N/A

1974

 

Director, Invesco Ltd.; Director and Senior

 

 

Senior Vice President

 

Vice President, Invesco Advisers, Inc. (formerly

 

 

 

 

known as Invesco Institutional (N.A.), Inc.)

 

 

 

 

(registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) (registered transfer agent);

 

 

 

 

Senior Vice President, The Invesco Funds;

 

 

 

 

Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset

 

 

 

 

Management); Director, President and

 

 

 

 

Chairman, Invesco Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited;

 

 

 

 

Director and Chief Executive, Invesco Asset

 

 

 

 

Management Limited and Invesco Fund

 

 

 

 

Managers Limited; Assistant Vice President,

 

 

 

 

The Invesco Funds; Senior Vice President,

 

 

 

 

Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Director and Chief

 

 

 

 

Executive, Invesco Administration Services

 

 

 

 

 

 

 

77 INVESCO HIGH YIELD BOND FACTOR FUND

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

Andrew R. Schlossberg

 

Limited and Invesco Global Investment

 

 

(Continued)

 

Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President,

 

 

 

 

Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco

 

 

 

 

India Exchange-Traded Fund Trust; Managing

 

 

 

 

Director and Principal Executive Officer,

 

 

 

 

Invesco Capital Management LLC

 

 

 

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas;

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional

 

 

 

 

(N.A.), Inc.) (registered investment adviser);

 

 

 

 

Senior Vice President, Invesco Distributors, Inc.

 

 

 

 

(formerly known as Invesco AIM Distributors,

 

 

 

 

Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as

 

 

 

 

Invesco AIM Investment Services, Inc.) Senior

 

 

 

 

Vice President, The Invesco Funds; Managing

 

 

 

 

Director, Invesco Capital Management LLC;

 

 

 

 

Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset

 

 

 

 

Management); Senior Vice President, Invesco

 

 

 

 

Capital Markets, Inc. (formerly known as

 

 

 

 

Van Kampen Funds Inc.); Manager, Invesco

 

 

 

 

Indexing LLC; Manager, Invesco Specialized

 

 

 

 

Products, LLC; Director and Senior Vice

 

 

 

 

President, Invesco Insurance Agency, Inc.;

 

 

 

 

Member, Invesco Canada Funds Advisory

 

 

 

 

Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate

 

 

 

 

mutual fund company); and Director,

 

 

 

 

Chairman, President and Chief Executive

 

 

 

 

Officer, Invesco Canada Ltd. (formerly known

 

 

 

 

as Invesco Trimark Ltd./Invesco Trimark Ltèe)

 

 

 

 

(registered investment adviser and registered

 

 

 

 

transfer agent)

 

 

 

 

Formerly: Director and Senior Vice President,

 

 

 

 

Invesco Management Group, Inc. (formerly

 

 

 

 

known as Invesco AIM Management Group,

 

 

 

 

Inc.); Secretary and General Counsel, Invesco

 

 

 

 

Management Group, Inc. (formerly known

 

 

 

 

as Invesco AIM Management Group, Inc.);

 

 

 

 

Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.); Chief Legal Officer and

 

 

 

 

 

 

 

78 INVESCO HIGH YIELD BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

John M. Zerr (Continued)

 

Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers

 

 

 

 

LLC (formerly known as Van Kampen Asset

 

 

 

 

Management); Secretary and General Counsel,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco

 

 

 

 

India Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-

 

 

 

 

Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Director,

 

 

 

 

Secretary, General Counsel and Senior Vice

 

 

 

 

President, Van Kampen Exchange Corp.;

 

 

 

 

Director, Vice President and Secretary, IVZ

 

 

 

 

Distributors, Inc. (formerly known as INVESCO

 

 

 

 

Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice

 

 

 

 

President, Van Kampen Advisors Inc.; Director,

 

 

 

 

Vice President, Secretary and General Counsel,

 

 

 

 

Van Kampen Investor Services Inc.; Director

 

 

 

 

and Secretary, Invesco Distributors, Inc.

 

 

 

 

(formerly known as Invesco AIM Distributors,

 

 

 

 

Inc.); Director, Senior Vice President, General

 

 

 

 

Counsel and Secretary, Invesco AIM Advisers,

 

 

 

 

Inc. and Van Kampen Investments Inc.;

 

 

 

 

Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice

 

 

 

 

President, Secretary, General Counsel and Vice

 

 

 

 

President, Invesco AIM Capital Management,

 

 

 

 

Inc.; Chief Operating Officer and General

 

 

 

 

Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

 

 

 

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.;

N/A

N/A

Senior Vice President

 

Director, Chairman, President, and Chief

 

 

 

 

Executive Officer, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional

 

 

 

 

(N.A.), Inc.) (registered investment adviser);

 

 

 

 

Director, Invesco Mortgage Capital, Inc. and

 

 

 

 

Invesco Senior Secured Management, Inc.;

 

 

 

 

and Senior Vice President, The Invesco Funds;

 

 

 

 

and President, SNW Asset Management

 

 

 

 

Corporation and Invesco Managed Accounts,

 

 

 

 

LLC

 

 

 

 

Formerly: Senior Vice President, Invesco

 

 

 

 

 

 

 

79 INVESCO HIGH YIELD BOND FACTOR FUND

TRUSTEES AND OFFICERS Unaudited / Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

Gregory G. McGreevey

 

Management Group, Inc. and Invesco Advisers,

 

 

(Continued)

 

Inc.; Assistant Vice President, The Invesco

 

 

 

 

Funds

 

 

 

 

 

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer

N/A

N/A

Vice President, Principal

 

– Investments Pool, Invesco Specialized

 

 

Financial Officer and Assistant

 

Products, LLC; Vice President, Principal

 

 

Treasurer

 

Financial Officer and Assistant Treasurer,

 

 

 

 

The Invesco Funds; Principal Financial and

 

 

 

 

Accounting Officer – Pooled Investments,

 

 

 

 

Invesco Capital Management LLC; Vice

 

 

 

 

President and Treasurer, Invesco Exchange-

 

 

 

 

Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund

 

 

 

 

Trust and Invesco Exchange-Traded Self-

 

 

 

 

Indexed Fund Trust; Vice President, Invesco

 

 

 

 

Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco

 

 

 

 

Specialized Products, LLC; Assistant Treasurer,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust,

 

 

 

 

Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-

 

 

 

 

Traded Self-Indexed Fund Trust; Assistant

 

 

 

 

Treasurer, Invesco Capital Management LLC;

 

 

 

 

Assistant Vice President, The Invesco Funds

 

 

 

 

 

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance

N/A

N/A

Anti-Money Laundering

 

Officer for Invesco U.S. entities including;

 

 

Compliance Officer

 

Invesco Advisers, Inc. and its affiliates, Invesco

 

 

 

 

Capital Markets, Inc., Invesco Distributors, Inc.,

 

 

 

 

Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC,

 

 

 

 

Invesco Trust Company; and Fraud Prevention

 

 

 

 

Manager for Invesco Investment Services, Inc.

 

 

 

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers,

N/A

N/A

Chief Compliance Officer

 

Inc. (registered investment adviser); and Chief

 

 

 

 

Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam

 

 

 

 

Investments and the Putnam Funds

 

 

 

 

 

 

 

80 INVESCO HIGH YIELD BOND FACTOR FUND

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza,

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers

Suite 1000

1555 Peachtree Street, N.E.

11 Greenway Plaza,

LLP

Houston, TX 77046-1173

Atlanta, GA 30309

Suite 1000

1000 Louisiana Street,

 

 

Houston, TX

Suite 5800

 

 

77046-1173

Houston, TX 77002-5021

Counsel to the Fund

Counsel to the

Transfer Agent

Custodian

Stradley Ronon Stevens & Young,

Independent Trustees

Invesco Investment

JPMorgan Chase Bank

LLP

Goodwin Procter LLP

Services, Inc.

4 Chase Metro Tech

2005 Market Street,

901 New York Avenue, N.W.

11 Greenway Plaza,

Center

Suite 2600

Washington, D.C. 20001

Suite 1000

Brooklyn, NY 11245

Philadelphia, PA 19103-7018

 

Houston, TX

 

 

 

77046-1173

 

81 INVESCO HIGH YIELD BOND FACTOR FUND

INVESCO PRIVACY NOTICE

Invesco recognizes the importance of protecting your personal and financial information when you visit our website located at www.invesco.com (the "Website"). The following information is designed to help you understand the information collection practices at this Website. We will not sell, share or rent your personally identifiable information to others in contravention of this Privacy Policy. When we refer to ourselves as "we" or "Invesco" in this Privacy Policy, we mean our entire company including our affiliates, such as subsidiaries.

By visiting this Website, you are accepting the practices described in this Privacy Policy. If you do not agree to this policy, you may not use this Website. This Privacy Policy is subject to change without notice, from time to time in our sole discretion. You acknowledge that by accessing the Website after we have posted changes to this Privacy Policy, you are agreeing to this Privacy Policy as modified. Please review

the Terms of Use1 to learn of other terms and conditions applicable to your use of the Website.

Please note that this Privacy Policy is not an exclusive statement of our privacy principles across all products and services. Other privacy principles or policies may apply depending on the products or services you obtain from Invesco, or the jurisdiction in which you transact with Invesco.

This Privacy Policy was last updated on May 6, 2018.

Information We Collect and Use

We collect personal information you choose to submit to the Website in order to process transactions requested by you and meet our contractual obligations. For example, you can choose to provide your name, contact information, social security number, or tax identification number in connection with accessing your account, or you can choose to provide your personal information when you fill out a secure account question form. Any information collected about you from the Website can, from time to time, be associated with other identifying information we have about you.

In addition, we may gather information about you automatically through your use of the Website, e.g. your IP address, how you navigate the Website, the organization from which you are accessing the Website, and the websites that you access before and after you visit the Website.

When you access the Website, we may also collect information such as unique device identifiers, your screen resolution and other device settings, information about your location, and analytical information about how you use the device from which you are viewing the Website. Where applicable, we may ask your permission before collecting certain information, such as precise geolocation information.

From time to time, we use or augment the personal information we have about you with information obtained from third parties. For example, we use third party information to confirm contact or financial information or to better understand your interests by associating demographic information from third parties with the information you have provided.

How We Use Personal Information

We use your personal information to respond to your inquiries and provide the products and services you request. We also use your information from time to time to deliver the content and services we believe

1NTD

82 INVESCO HIGH YIELD BOND FACTOR FUND

you will find the most relevant and to provide customer service and support.

We also use the information you provide to further develop and improve our products and services. We aggregate and/or de-identify data about visitors to the Website for various business purposes including product and service development and improvement activities.

How We Share Personal Information

We collaborate with other companies and individuals to perform services for us and on our behalf and we collaborate with our affiliates, other companies and individuals with respect to particular products or services ("Providers"). Examples of Providers include data analysis firms, customer service and support providers, email and SMS vendors, and web-hosting and development companies. Some Providers collect information for us or on our behalf on our Website. These Providers can be provided with access to personal information needed to perform their functions.

We reserve the right to disclose your personal information as required by law, when we believe disclosure is necessary to comply with a regulatory requirement, judicial proceeding, court order or legal process served on us, to protect the safety, rights or property of our customers, the public or Invesco or to enforce the Terms of Use.

If we sell or transfer a business unit (such as a subsidiary) or an asset (such as a website) to another company, we will share your personal information with such company. You will receive notice of such an event and the new entity will inform you of any changes to the practices in this Privacy Policy. If the new entity wishes to make additional use of your information, you have the right to decline such use at that time.

We occasionally disclose aggregate or de-identified data that is not personally identifiable with third parties.

Cookies and Other Tools

Invesco and its Providers collect information about you by using cookies, tracking pixels and other technologies. We use this information to better understand, customize and improve user experience with our websites, services and offerings as well as to manage our advertising. For example, we use web analytics services that use these technologies to gather information to help us understand how visitors engage with and navigate our Website, e.g., how and when pages in a site are visited and by how many visitors. We are also able to offer our visitors a more customized, relevant experience on our sites using these technologies by delivering content and functionality based on your preferences and interests.

Depending on their purpose, some cookies will only operate for the length of a single browsing session, while others have a longer life span to ensure that they fulfill their longer-term purposes. Your web browser can be set to allow you to control whether you will accept cookies or reject cookies, to notify you each time a cookie is sent to your browser, or to delete cookies that have already been set. If your browser is set to reject cookies, certain aspects of the Website that are cookie-enabled will not recognize you when you return to the website, and some Website functionality may be lost. The "Help" section of your browser may tell you how to prevent your browser from accepting cookies. To find out more about cookies, visit www.aboutcookies.org.

83 INVESCO HIGH YIELD BOND FACTOR FUND

INVESCO PRIVACY NOTICE Continued

Security

No data transmission over the internet can be 100% secure, so Invesco cannot ensure or warrant the security of any information you submit to us on this Website. However, Invesco seeks to protect your personal information from unauthorized access or use when you transact business on our Website using technical, administrative and procedural measures. Invesco makes no representation as to the reasonableness, efficacy, or appropriateness of the measures we use to safeguard such information.

Users are responsible for maintaining the secrecy of their own passwords. If you have reason to believe that your interaction with us is no longer secure (for example, if you feel that the security of any account you might have with us has been compromised), please immediately notify us by contacting us as specified below.

Transfer of Data to Other Countries

Any information you provide to Invesco through use of the Website may be stored and processed, transferred between and accessed from the United States, Canada and other countries which do not guarantee the same level of protection of personal information as the one in which you reside. However, Invesco will handle your personal information in accordance with this Privacy Policy regardless of where your personal information is stored/accessed.

Children's Privacy

We are committed to protecting the privacy of children. We do not knowingly collect personal information from children under the age of 18. If you are under the age of 18, do not provide us with any personal information.

Contact Us

Please contact us if you have any questions or concerns about your personal information or require assistance in managing your choices.

Invesco Ltd.

1555 Peachtree St. NE Atlanta, GA 30309 By phone:

(404)439-3236 By fax:

(404)962-8288 By email: Anne.Gerry@invesco.com

Please update your account information by logging in or contact us by email or telephone as specified above to update your account information whenever such information ceases to be complete or accurate.

You may also contact us to:

84 INVESCO HIGH YIELD BOND FACTOR FUND

Request that we amend, rectify, delete or update the personal data we hold about you;

Where possible (e.g. in relation to marketing) amend or update your choices around processing;

Request a copy of personal data held by us.

Disclaimer

Where the Website contains links to third-party websites/content/services that are not owned or controlled by Invesco, Invesco is not responsible for how these properties operate or treat your personal information so we recommend that you read the privacy policies and terms associated with these third party properties carefully.

85 INVESCO HIGH YIELD BOND FACTOR FUND

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Explore High-Conviction Investing with Invesco

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

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￿Daily confirmations

￿Tax forms

Invesco mailing information

Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Invesco Distributors, Inc.

O-GLHY-AR-1 04272020

Shareholder Report for the

Seven Months Ended 2/29/2020

Invesco

Intermediate Bond

Factor Fund*

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund's shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund's website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by enrolling at invesco. com/edelivery.

You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call 800 959 4246 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with your financial intermediary or all funds held with the fund complex if you invest directly with the Fund.

*Prior to the close of business on February 28, 2020, the Fund's name was Invesco Oppenheimer Intermediate Income Fund, and prior to the close of business on May 24, 2019, the Fund's name was Oppenheimer Intermediate Income Fund. See Important Update on the following page for more information.

Important Update

On October 18, 2018, Massachusetts Mutual Life Insurance Company, an indirect corporate parent of OppenheimerFunds, Inc. and its subsidiaries OFI Global Asset Management, Inc., OFI SteelPath, Inc. and OFI Advisors, LLC, announced that it had entered into an agreement whereby Invesco Ltd., a global investment management company would acquire OppenheimerFunds and its subsidiaries (together, "OppenheimerFunds"). After the close of business on May 24, 2019 Invesco Ltd. completed the acquisition of OppenheimerFunds. This Fund was included in that acquisition and as of that date, became part of the Invesco family of funds. Please visit invesco.com for more information or call Invesco's Client Services team at 800-959-4246.

Table of Contents

 

Fund Performance Discussion

5

Top Holdings and Allocations

7

Fund Expenses

10

Schedule of Investments

12

Statement of Assets and Liabilities

28

Statement of Operations

30

Statement of Changes in Net Assets

32

Financial Highlights

33

Notes to Financial Statements

44

Report of Independent Registered Public Accounting Firm

62

Tax Information

64

Portfolio Proxy Voting Policies and Guidelines; Updates to

 

Schedule of Investments

65

Trustees and Officers

66

Invesco's Privacy Notice

78

Class A Shares

AVERAGE ANNUAL TOTAL RETURNS AT 2/29/20

 

 

 

 

 

 

Class A Shares of the Fund

 

 

 

 

Bloomberg Barclays

 

Without Sales Charge

With Sales Charge

U.S. Aggregate Bond

 

 

 

Index

1-Year

11.39%

6.67%

11.68%

5-Year

3.34

2.45

3.58

Since Inception (8/2/10)

5.02

4.55

3.66

Performance quoted is past performance and cannot guarantee comparable future results; current performance may be lower or higher. Visit invesco.com for the most recent month-end performance. Performance figures reflect reinvested distributions and changes in net asset value (NAV). Investment return and principal value will vary so that you may have a gain or a loss when you sell shares. Fund returns include changes in share price, reinvested distributions and a 4.25% maximum applicable sales charge except where "without sales charge" is indicated. As the result of a reorganization after the close of business on May 24, 2019, the returns of the Fund for periods on or prior to May 24, 2019 reflect performance of the Oppenheimer predecessor fund. Share class returns will differ from those of the predecessor fund because they have different expenses. Returns for periods of less than one year are not annualized. Returns do not consider capital gains or income taxes on an individual's investment. See Fund prospectus and

3 INVESCO INTERMEDIATE BOND FACTOR FUND

summary prospectus for more information on share classes, sales charges and new fee agreements, if any. Fund literature is available at invesco.com.

4 INVESCO INTERMEDIATE BOND FACTOR FUND

Fund Performance Discussion

MARKET OVERVIEW

During the fiscal year ended February 29, 2020, US Treasury yields fell considerably, especially in February as concerns regarding the spread of the coronavirus took hold. The US credit market performed strongly over the fiscal year, with returns above 15%. Investment grade credit spreads tightened for most of the fiscal year, but with worries stemming from the coronavirus, spreads widened in the last two months of the fiscal year. With spreads roughly unchanged over the past 12 months, the primary driver of performance was the decline in US Treasury yields. In particular, the 10-year US Treasury fell to 1.13% at the end of the fiscal year from 2.73% in February 2019.

Over the past 12 months, the US Federal Reserve (the Fed) cut interest rates three times: in July, September and October 2019 -- for a total of 75 basis points. (A basis point is one one-hundredth of a percentage point.) As a result, the federal funds target rate stood at a range of 1.50% to 1.75% as of October 31, 2019, as well as at the end of the fiscal year. Moreover, US Treasury rates fell across all maturities. The out-of-benchmark US high yield sector posted a positive return for the fiscal year, as did emerging markets credit.

COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:

Invesco Intermediate Bond Factor Fund (Class A shares with sales charge)

Bloomberg Barclays U.S. Aggregate Bond Index

$20,000

15,000

 

 

 

 

 

 

 

 

 

$15,309

 

 

 

 

 

 

 

 

 

$14,105

 

 

 

 

 

 

 

 

 

 

10,000

 

 

 

 

 

 

 

 

 

 

5,000

 

 

 

 

 

 

 

 

 

 

0 |

|

|

|

|

|

|

|

|

|

|

8/2/10

2/28/11

2/29/12

2/28/13

2/28/14

2/28/15

2/29/16

2/28/17

2/28/18

2/28/19

2/29/20

5 INVESCO INTERMEDIATE BOND FACTOR FUND

FUND REVIEW

Against this backdrop, the Fund's Class A shares (without sales charge) produced a return of 11.39% this reporting period, underperforming the Bloomberg Barclays U.S. Aggregate Bond Index's (the "Index") return of 11.68%.

During the year, the Fund performed well due to its exposure to corporate bonds, including investment grade as well as an off-benchmark position in high yield. The allocation to structured securities was a minor drag due to the lower duration associated with these positions

On February 28, 2020, the Invesco Oppenheimer Intermediate Income Fund was repositioned. The Fund was renamed the Invesco Intermediate Bond Factor Fund with an investment goal to seek a total return by targeting securities with characteristics that research suggests will have higher returns over a market cycle while using a factor- based strategy. In practice, this means the Fund will have higher allocation than its benchmark to value bonds (bonds that have higher spreads relative to other securities of similar credit quality and/or sector); low volatility bonds (bonds that have lower levels of price volatility); and high carry bonds (bonds with higher absolute yield or spread). The Fund may invest in investment grade debt securities, including corporate and government bonds, mortgage-related securities, asset-backed securities, notes and debentures and other types of debt securities.

It may also invest a portion of its assets in foreign debt securities.

Portfolio Managers: Jay Raol, James Ong, Noelle Corum and Sash Sarangi

6 INVESCO INTERMEDIATE BOND FACTOR FUND

Top Holdings and Allocations

CORPORATE BONDS & NOTES - TOP TEN INDUSTRIES

Commercial Banks

8.1%

Oil, Gas & Consumable Fuels

4.5

Capital Markets

3.3

Electric Utilities

2.9

Real Estate Investment Trusts

1.9

(REITs)

 

Media

1.8

Food Products

1.8

Automobiles

1.7

Insurance

1.7

Beverages

1.6

Holdings and allocations are subject to change and are not buy/sell recommendations. Percentages are as of February 29, 2020, and are based on net assets.

For more current Fund holdings, please visit invesco.com.

PORTFOLIO ALLOCATION

Non-Convertible Corporate Bonds

49.9%

and Notes

U.S. Government Obligations

21.3

Investment Companies

18.6

Mortgage-Backed Obligations

 

Agency

1.9

CMOs

3.1

Non-Agency

2.8

Preferred Stocks

1.9

Asset-Backed Securities

0.5

Portfolio holdings and allocations are subject to change. Percentages are as of February 29, 2020, and are based on the total market value of investments.

7 INVESCO INTERMEDIATE BOND FACTOR FUND

Share Class Performance

AVERAGE ANNUAL TOTAL RETURNS WITHOUT SALES CHARGE AS OF 2/29/20

 

 

 

 

 

 

 

 

 

Inception

 

 

Since

 

 

Date

1-Year

5-Year

Inception

Class A (OFIAX)

8/2/10

11.39%

3.34%

5.02%

Class C (OFICX)

8/2/10

10.33

2.54

4.18

Class R (OFINX)

8/2/10

10.87

3.05

4.71

Class Y (OFIYX)

8/2/10

11.78

3.64

5.26

Class R5

(IOTEX)1

5/24/19

11.51

3.36

5.03

Class R6

(OFIIX)2

11/28/12

11.76

3.78

4.16

AVERAGE ANNUAL TOTAL RETURNS WITH SALES CHARGE AS OF 2/29/20

 

 

 

 

 

 

 

 

 

Inception

 

 

Since

 

 

Date

1-Year

5-Year

Inception

Class A (OFIAX)

8/2/10

6.67%

2.45%

4.55%

Class C (OFICX)

8/2/10

9.33

2.54

4.18

Class R (OFINX)

8/2/10

10.87

3.05

4.71

Class Y (OFIYX)

8/2/10

11.78

3.64

5.26

Class R5

(IOTEX)1

5/24/19

11.51

3.36

5.03

Class R6

(OFIIX)2

11/28/12

11.76

3.78

4.16

1.Class R5 shares' performance shown prior to the inception date is that of the predecessor fund's Class A shares at net asset value (NAV) and includes the 12b-1 fees applicable to Class A shares. Class A shares' performance reflects any applicable fee waivers and/or expense reimbursements.

2.Pursuant to the closing of the transaction described in the Notes to Financial Statements, after the close of business on May 24, 2019, Class I shares were reorganized as Class R6 shares.

Performance quoted is past performance and cannot guarantee comparable future results; current performance may be lower or higher. Visit invesco.com for the most recent month-end performance. Performance figures reflect reinvested distributions and changes in net asset value (NAV). Investment return and principal value will vary so that you may have a gain or a loss when you sell shares. Performance shown at NAV does not include the applicable front-end sales charge, which would have reduced the performance. The current maximum initial sales charge for Class A shares is 4.25%, and the contingent deferred sales charge for Class C shares is 1% for the 1-year period. Class R, Class Y, Class R5 and Class R6 shares have no sales charge; therefore, performance is at NAV. Effective after the close of business on May 24, 2019, Class A, Class C, Class R, Class Y, and Class I shares of the predecessor fund were reorganized into Class A, Class C, Class R, Class Y, and Class R6 shares, respectively, of the Fund. Class R5 shares' performance shown prior to the inception date is that of the predecessor fund's Class A shares at NAV and includes the 12b-1 fees applicable to Class A shares. Class A shares' performance reflects any applicable fee waivers and/or expense reimbursements. Returns shown for Class A, Class C, Class R, Class Y, Class R5, and Class R6 shares are blended returns of the predecessor fund and the Fund. Share class returns will differ from those of the predecessor fund because of different expenses. See Fund prospectuses and summary prospectuses for more information on share classes, sales charges and new fee agreements, if any. Fund literature is available at invesco.com.

8 INVESCO INTERMEDIATE BOND FACTOR FUND

The Bloomberg Barclays U.S. Aggregate Bond Index is an index of U.S dollar-denominated, investment-grade U.S. corporate government and mortgage-backed securities The Index

is unmanaged and cannot be purchased directly by investors. While index comparisons may be useful to provide a benchmark for the Fund's performance, it must be noted that the Fund's investments are not limited to the investments comprising the Index. Index performance includes reinvestment of income, but does not reflect transaction costs, fees, expenses or taxes. Index performance is shown for illustrative purposes only as a benchmark for the Fund's performance, and does not predict or depict performance of the Fund. The Fund's performance reflects the effects of the Fund's business and operating expenses.

The views and opinions expressed in management's discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

Before investing, investors should carefully read the prospectus and/or summary prospectus and carefully consider the investment objectives, risks, charges and expenses. For this and more complete information about the fund(s), investors should ask their advisors for a prospectus/summary prospectus or visit invesco. com/fundprospectus.

Shares of Invesco funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

9 INVESCO INTERMEDIATE BOND FACTOR FUND

Fund Expenses

Fund Expenses. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments and/or contingent deferred sales charges on redemptions; and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended February 29, 2020.

Actual Expenses. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled "Expenses Paid During 6 Months Ended February 29, 2020" to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class 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 for the class of shares you hold 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 transactional costs, such as front-end or contingent deferred sales charges (loads). Therefore, the "hypothetical" section of the table 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 transactional costs were included, your costs would have been higher.

10 INVESCO INTERMEDIATE BOND FACTOR FUND

 

Beginning

Ending

Expenses

 

Account

Account

Paid During

 

Value

Value

6 Months Ended

Actual

September 1, 2019

February 29, 2020

February 29, 2020

Class A

$ 1,000.00

$ 1,029.70

$

3.69

Class C

1,000.00

1,026.00

 

8.24

Class R

1,000.00

1,028.60

 

5.72

Class Y

1,000.00

1,032.10

 

2.17

Class R5

1,000.00

1,031.10

 

2.22

Class R6

1,000.00

1,031.40

 

1.97

Hypothetical

 

 

 

 

(5% return before expenses)

 

 

 

 

Class A

1,000.00

1,021.23

 

3.68

Class C

1,000.00

1,016.76

 

8.21

Class R

1,000.00

1,019.24

 

5.69

Class Y

1,000.00

1,022.73

 

2.16

Class R5

1,000.00

1,022.68

 

2.22

Class R6

1,000.00

1,022.92

 

1.96

Expenses are equal to the Fund's annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated funds, based on the 6-month period ended February 29, 2020 are as follows:

Class

Expense Ratios

Class A

0.73%

Class C

1.63

Class R

1.13

 

 

Class Y

0.43

Class R5

0.44

Class R6

0.39

The expense ratios reflect voluntary and/or contractual waivers and/or reimbursements of expenses by the Fund's Adviser. Some of these undertakings may be modified or terminated at any time, as indicated in the Fund's prospectus. The "Financial Highlights" tables in the Fund's financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable.

11 INVESCO INTERMEDIATE BOND FACTOR FUND

SCHEDULE OF INVESTMENTS February 29, 2020

AL

 

 

 

Principal Amount

 

 

Value

Asset-Backed Securities—0.5%

 

 

 

 

 

 

DT Auto Owner Trust, Series 2017-1A, Cl. E, 5.79%, 2/15/241

$

750,000

$

776,590

Navistar Financial Dealer Note Master Owner Trust II:

 

 

 

 

 

Series 2019-1, Cl. C, 2.577% [US0001M+95], 5/25/241,2

 

70,000

 

 

70,150

Series 2019-1, Cl. D, 3.077% [US0001M+145], 5/25/241,2

 

65,000

 

 

65,111

Total Asset-Backed Securities (Cost $897,952)

 

 

 

 

911,851

 

 

 

 

 

 

Mortgage-Backed Obligations—8.0%

 

 

 

 

 

Banc of America Mortgage Trust, Series 2007-1, Cl. 1A24,

 

 

 

 

 

6.00%, 3/25/37

 

 

24,628

 

 

24,801

BANK, Interest-Only Stripped Mtg.-Backed Security, Series

 

 

 

 

 

2019-BN16, Cl. XA, 10.962%, 2/15/523

 

 

2,387,423

 

 

171,417

Citigroup Commercial Mortgage Trust, Interest-Only

 

 

 

 

 

Commercial Mtg. Pass-Through Certificates, Series 2017-C4,

 

 

 

 

 

Cl. XA, 0.00%, 10/12/503,4

 

 

6,408,289

 

 

408,002

COMM Mortgage Trust:

 

 

 

 

 

 

Series 2014-UBS4, Cl. AM, 3.968%, 8/10/47

 

407,000

 

 

441,391

Series 2014-UBS6, Cl. AM, 4.048%, 12/10/47

 

900,000

 

 

975,813

Connecticut Avenue Securities:

 

 

 

 

 

 

Series 2013-C01, Cl. M2, 6.877% [US0001M+525],

 

 

 

 

 

10/25/232

 

 

464,838

 

 

512,280

Series 2014-C01, Cl. M2, 6.027% [US0001M+440], 1/25/242

 

786,169

 

 

849,324

Series 2014-C02, Cl. 1M2, 4.227% [US0001M+260],

 

 

 

 

 

5/25/242

 

 

340,089

 

 

352,697

Series 2014-C03, Cl. 1M2, 4.627% [US0001M+300],

 

 

 

 

 

7/25/242

 

 

739,594

 

 

778,545

Series 2014-C03, Cl. 2M2, 4.527% [US0001M+290],

 

 

 

 

 

7/25/242

 

 

94,629

 

 

98,379

Series 2014-C04, Cl. 2M2, 6.627% [US0001M+500],

 

 

 

 

 

11/25/242

 

 

340,313

 

 

365,562

Series 2016-C01, Cl. 1M2, 8.377% [US0001M+675],

 

 

 

 

 

8/25/282

 

 

205,194

 

 

224,772

Series 2016-C02, Cl. 1M2, 7.627% [US0001M+600],

 

 

 

 

 

9/25/282

 

 

368,462

 

 

397,762

Series 2016-C05, Cl. 2M2, 6.077% [US0001M+445],

 

 

 

 

 

1/25/292

 

 

254,118

 

 

267,828

Series 2016-C06, Cl. 1M2, 5.877% [US0001M+425],

 

 

 

 

 

4/25/292

 

 

360,000

 

 

382,200

Connecticut Avenue Securities Trust:

 

 

 

 

 

 

Series 2018-R07, Cl. 1M2, 4.027% [US0001M+240],

 

 

 

 

 

4/25/311,2

 

 

384,182

 

 

387,344

Series 2019-R01, Cl. 2M1, 2.477% [US0001M+85],

 

 

 

 

 

7/25/311,2

 

 

32,218

 

 

32,221

Series 2019-R02, Cl. 1M2, 3.927% [US0001M+230],

 

 

 

 

 

8/25/311,2

 

 

192,228

 

 

193,626

Series 2019-R03, Cl. 1M2, 3.777% [US0001M+215],

 

 

 

 

 

9/25/311,2

 

 

190,417

 

 

191,521

Federal Home Loan Mortgage Corp., Interest-Only Stripped

 

 

 

 

 

Mtg.-Backed Security, Series 304, Cl. C45, 9.092%, 12/15/273

 

163,878

 

 

10,510

12

INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

 

 

 

Principal Amount

 

Value

Mortgage-Backed Obligations (Continued)

 

 

 

 

Federal Home Loan Mortgage Corp., Multifamily Structured Pass-Through Certificates, Interest-Only Stripped Mtg.-

Backed Security:

 

 

 

 

 

Series K093, Cl. X1, 0.00%, 5/25/293,4

 

$

2,557,008

$

198,206

Series K734, Cl. X1, 0.00%, 2/25/263,4

 

 

3,067,733

 

105,252

Series K735, Cl. X1, 0.00%, 5/25/263,4

 

 

3,238,215

 

175,223

Series KC03, Cl. X1, 0.00%, 11/25/243,4

 

 

4,164,922

 

89,398

Federal Home Loan Mortgage Corp., Real Estate Mtg.

 

 

 

 

Investment Conduit Multiclass Pass-Through Certificates,

 

 

 

 

Interest-Only Stripped Mtg.-Backed Security, Series 4316, Cl.

 

 

 

 

JS, 0.00%, 1/15/443,4

 

 

431,006

 

50,436

Federal Home Loan Mortgage Corp., STACR Trust:

 

 

 

 

Series 2019-HQA1, Cl. M1, 2.527% [US0001M+90],

 

 

 

 

2/25/491,2

 

 

13,361

 

13,363

Series 2019-HRP1, Cl. M2, 3.027% [US0001M+140],

 

 

 

 

2/25/491,2

 

 

190,000

 

189,588

Federal National Mortgage Assn., Alternative Credit

 

 

 

 

Enhancement Securities, Interest-Only Stripped Mtg.-Backed

 

 

 

 

Security, Series 2012-M18, Cl. X, 0.00%, 12/25/223,4

 

20,993,233

 

127,712

Federal National Mortgage Assn., Real Estate Mtg. Investment Conduit Multiclass Pass-Through Certificates, Interest-

Only Stripped Mtg.-Backed Security:

 

 

 

 

 

Series 2015-57, Cl. LI, 6.038%, 8/25/353

 

435,512

 

54,582

Series 2016-45, Cl. MI, 7.867%, 7/25/463

 

119,617

 

22,642

Series 2017-60, Cl. LI, 0.00%, 8/25/473,4

 

259,924

 

18,238

Series 2017-66, Cl. AS, 2.92%, 9/25/473

 

 

1,517,577

 

212,791

FREMF Mortgage Trust:

 

 

 

 

 

Series 2012-K23, Cl. C, 3.656%, 10/25/451,5

 

395,000

 

410,659

Series 2013-K28, Cl. C, 3.49%, 6/25/461,5

 

390,000

 

408,384

Series 2013-K29, Cl. C, 3.476%, 5/25/461,5

 

220,000

 

230,345

Series 2013-K32, Cl. C, 3.537%, 10/25/461,5

 

450,000

 

472,445

Series 2014-K36, Cl. C, 4.364%, 12/25/461,5

 

500,000

 

535,106

Series 2014-K38, Cl. B, 4.222%, 6/25/471,5

 

280,000

 

306,282

Series 2014-K714, Cl. C, 3.909%, 1/25/471,5

 

215,000

 

217,316

Series 2016-K54, Cl. C, 4.051%, 4/25/481,5

 

290,000

 

310,854

Government National Mortgage Assn., Interest-Only Stripped

 

 

 

 

Mtg.-Backed Security, Series 2017-149, Cl. GS, 4.264%,

 

 

 

 

10/16/473

 

 

832,829

 

134,630

JPMBB Commercial Mortgage Securities Trust, Series 2014-

 

 

 

 

C24, Cl. AS, 3.914%, 11/15/475

 

 

200,000

 

215,976

Morgan Stanley Bank of America Merrill Lynch Trust, Series

 

 

 

 

2013-C9, Cl. AS, 3.456%, 5/15/46

 

 

770,000

 

811,348

STACR Trust, Series 2018-HRP1, Cl. M2, 3.277%

 

 

 

 

[US0001M+165], 4/25/431,2

 

 

556,403

 

557,602

Structured Agency Credit Risk Debt Nts.:

 

 

 

 

 

Series 2013-DN2, Cl. M2, 5.877% [US0001M+425],

 

 

 

 

11/25/232

 

 

348,714

 

377,949

Series 2014-DN2, Cl. M3, 5.227% [US0001M+360],

 

 

 

 

4/25/242

 

 

515,000

 

545,790

Series 2014-DN3, Cl. M3, 5.627% [US0001M+400],

 

 

 

 

8/25/242

 

 

468,010

 

497,316

13

INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Mortgage-Backed Obligations (Continued)

 

 

 

 

 

Structured Agency Credit Risk Debt Nts.: (Continued)

 

 

 

 

 

Series 2016-DNA2, Cl. M3, 6.277% [US0001M+465],

 

 

 

 

 

10/25/282

$

222,682

$

237,825

Series 2018-HQA1, Cl. M2, 3.927% [US0001M+230],

 

 

 

 

 

9/25/302

 

175,000

 

 

176,819

WaMu Mortgage Pass-Through Certificates Trust, Series 2005-

 

 

 

 

 

AR14, Cl. 1A4, 3.838%, 12/25/355

 

37,682

 

 

38,316

WF-RBS Commercial Mortgage Trust, Series 2014-LC14, Cl.

 

 

 

 

 

AS, 4.351%, 3/15/475

 

450,000

 

 

489,335

Total Mortgage-Backed Obligations (Cost $14,997,623)

 

 

 

 

15,297,723

 

 

 

 

 

 

U.S. Government Obligations—22.0%

 

 

 

 

 

United States Treasury Bond, 2.375%, 11/15/49

 

1,037,600

 

 

1,211,540

United States Treasury Nts.:

 

 

 

 

 

1.125%, 2/28/22

 

9,800,000

 

 

9,845,937

1.375%, 1/31/22-1/31/25

 

16,902,000

 

 

17,263,103

1.50%, 8/15/26-2/15/30

 

13,091,400

 

 

13,486,381

Total U.S. Government Obligations (Cost $40,680,261)

 

 

 

 

41,806,961

 

 

 

 

 

 

Corporate Bonds and Notes—51.3%

 

 

 

 

 

Consumer Discretionary—7.8%

 

 

 

 

 

Auto Components—0.3%

 

 

 

 

 

Goodyear Tire & Rubber Co. (The), 5.125% Sr. Unsec. Nts.,

 

 

 

 

 

11/15/23

 

495,000

 

 

492,372

 

 

 

 

 

 

Automobiles—1.7%

 

 

 

 

 

Daimler Finance North America LLC, 2.55% Sr. Unsec. Nts.,

 

 

 

 

 

8/15/221

 

481,000

 

 

489,521

Ford Motor Credit Co. LLC:

 

 

 

 

 

3.087% Sr. Unsec. Nts., 1/9/23

 

385,000

 

 

386,275

5.584% Sr. Unsec. Nts., 3/18/24

 

325,000

 

 

347,944

General Motors Co., 6.25% Sr. Unsec. Nts., 10/2/43

 

403,000

 

 

458,598

General Motors Financial Co., Inc., 4.20% Sr. Unsec. Nts.,

 

 

 

 

 

11/6/21

 

262,000

 

 

270,818

Harley-Davidson Financial Services, Inc., 2.55% Sr. Unsec.

 

 

 

 

 

Nts., 6/9/221

 

475,000

 

 

483,697

Hyundai Capital America, 4.30% Sr. Unsec. Nts., 2/1/241

 

350,000

 

 

377,145

Volkswagen Group of America Finance LLC, 4.00% Sr. Unsec.

 

 

 

 

 

Nts., 11/12/211

 

482,000

 

 

501,979

 

 

 

 

 

3,315,977

 

 

 

 

 

 

Diversified Consumer Services—0.3%

 

 

 

 

 

Service Corp. International, 4.625% Sr. Unsec. Nts., 12/15/27

 

492,000

 

 

516,513

 

 

 

 

 

 

Entertainment—0.4%

 

 

 

 

 

Discovery Communications LLC, 4.125% Sr. Unsec. Nts.,

 

 

 

 

 

5/15/29

 

289,000

 

 

318,029

14 INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

Principal Amount

 

 

Value

Entertainment (Continued)

 

 

 

 

 

Netflix, Inc., 5.50% Sr. Unsec. Nts., 2/15/22

$

484,000

$

508,660

 

 

 

 

 

826,689

 

 

 

 

 

 

Hotels, Restaurants & Leisure—0.6%

 

 

 

 

 

Aramark Services, Inc., 5.00% Sr. Unsec. Nts., 4/1/251

 

479,000

 

 

495,760

International Game Technology plc, 6.50% Sr. Sec. Nts.,

 

 

 

 

 

2/15/251

 

470,000

 

 

509,945

McDonald's Corp., 3.625% Sr. Unsec. Nts., 9/1/49

 

111,000

 

 

119,833

 

 

 

 

 

1,125,538

 

 

 

 

 

 

Household Durables—0.9%

 

 

 

 

 

Lennar Corp., 4.75% Sr. Unsec. Nts., 5/30/25

 

413,000

 

 

447,161

MDC Holdings, Inc., 3.85% Sr. Unsec. Nts., 1/15/30

 

369,000

 

 

369,692

Toll Brothers Finance Corp.:

 

 

 

 

 

4.375% Sr. Unsec. Nts., 4/15/23

 

619,000

 

 

645,564

4.875% Sr. Unsec. Nts., 3/15/27

 

175,000

 

 

191,413

 

 

 

 

 

1,653,830

 

 

 

 

 

 

Internet & Catalog Retail—0.4%

 

 

 

 

 

QVC, Inc., 4.45% Sr. Sec. Nts., 2/15/25

 

825,000

 

 

839,541

 

 

 

 

 

 

Media—1.8%

 

 

 

 

 

Charter Communications Operating LLC/Charter

 

 

 

 

 

Communications Operating Capital, 5.125% Sr. Sec. Nts.,

 

 

 

 

 

7/1/49

 

130,000

 

 

146,472

Comcast Corp., 2.65% Sr. Unsec. Nts., 2/1/30

 

135,000

 

 

141,728

Interpublic Group of Cos., Inc. (The), 4.20% Sr. Unsec. Nts.,

 

 

 

 

 

4/15/24

 

534,000

 

 

586,813

Lamar Media Corp., 5.75% Sr. Unsec. Nts., 2/1/26

 

460,000

 

 

479,274

Time Warner Cable LLC, 4.50% Sr. Sec. Nts., 9/15/42

 

420,000

 

 

437,950

ViacomCBS, Inc.:

 

 

 

 

 

4.20% Sr. Unsec. Nts., 6/1/29

 

239,000

 

 

268,317

4.375% Sr. Unsec. Nts., 3/15/43

 

500,000

 

 

538,234

WPP Finance 2010, 3.75% Sr. Unsec. Nts., 9/19/24

 

840,000

 

 

904,144

 

 

 

 

 

3,502,932

 

 

 

 

 

 

Specialty Retail—1.1%

 

 

 

 

 

Advance Auto Parts, Inc., 4.50% Sr. Unsec. Nts., 12/1/23

 

450,000

 

 

494,849

Gap, Inc. (The), 5.95% Sr. Unsec. Nts., 4/12/21

 

470,000

 

 

478,812

Home Depot, Inc. (The), 2.95% Sr. Unsec. Nts., 6/15/29

 

280,000

 

 

302,929

Ross Stores, Inc., 3.375% Sr. Unsec. Nts., 9/15/24

 

697,000

 

 

749,738

 

 

 

 

 

2,026,328

 

 

 

 

 

 

Textiles, Apparel & Luxury Goods—0.3%

 

 

 

 

 

Hanesbrands, Inc., 4.875% Sr. Unsec. Nts., 5/15/261

 

515,000

 

 

540,415

15 INVESCO INTERMEDIATE BOND FACTOR FUND

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Consumer Staples—4.1%

 

 

 

 

 

Beverages—1.6%

 

 

 

 

 

Anheuser-Busch InBev Worldwide, Inc., 8.20% Sr. Unsec. Nts.,

 

 

 

 

 

1/15/39

$

650,000

$

1,071,820

Bacardi Ltd., 4.70% Sr. Unsec. Nts., 5/15/281

 

811,000

 

 

928,895

Keurig Dr Pepper, Inc., 4.597% Sr. Unsec. Nts., 5/25/28

 

805,000

 

 

929,408

Molson Coors Beverage Co., 4.20% Sr. Unsec. Nts., 7/15/46

 

140,000

 

 

145,659

 

 

 

 

 

3,075,782

 

 

 

 

 

 

Food & Staples Retailing—0.2%

 

 

 

 

 

Kroger Co. (The), 4.45% Sr. Unsec. Nts., 2/1/47

 

350,000

 

 

397,260

 

 

 

 

 

 

Food Products—1.8%

 

 

 

 

 

Bunge Ltd. Finance Corp., 3.25% Sr. Unsec. Nts., 8/15/26

 

810,000

 

 

838,516

Conagra Brands, Inc., 5.40% Sr. Unsec. Nts., 11/1/48

 

400,000

 

 

506,862

Experian Finance plc, 2.75% Sr. Unsec. Nts., 3/8/301

 

497,000

 

 

525,477

Lamb Weston Holdings, Inc., 4.875% Sr. Unsec. Nts., 11/1/261

 

489,000

 

 

508,266

Smithfield Foods, Inc.:

 

 

 

 

 

3.35% Sr. Unsec. Nts., 2/1/221

 

287,000

 

 

292,864

5.20% Sr. Unsec. Nts., 4/1/291

 

377,000

 

 

430,500

Tyson Foods, Inc., 5.10% Sr. Unsec. Nts., 9/28/48

 

261,000

 

 

340,828

 

 

 

 

 

3,443,313

 

 

 

 

 

 

Tobacco—0.5%

 

 

 

 

 

Altria Group, Inc., 3.875% Sr. Unsec. Nts., 9/16/46

 

355,000

 

 

346,055

BAT Capital Corp., 3.557% Sr. Unsec. Nts., 8/15/27

 

485,000

 

 

512,393

 

 

 

 

 

858,448

 

 

 

 

 

 

Energy—4.7%

 

 

 

 

 

Energy Equipment & Services—0.2%

 

 

 

 

 

Enterprise Products Operating LLC, 4.20% Sr. Unsec. Nts.,

 

 

 

 

 

1/31/50

 

173,000

 

 

184,468

Plains All American Pipeline LP/PAA Finance Corp., 3.55% Sr.

 

 

 

 

 

Unsec. Nts., 12/15/29

 

231,000

 

 

227,718

 

 

 

 

 

412,186

 

 

 

 

 

 

Oil, Gas & Consumable Fuels—4.5%

 

 

 

 

 

Apache Corp., 4.375% Sr. Unsec. Nts., 10/15/28

 

382,000

 

 

402,080

Boardwalk Pipelines LP, 4.95% Sr. Unsec. Nts., 12/15/24

 

445,000

 

 

487,660

Cenovus Energy, Inc., 4.25% Sr. Unsec. Nts., 4/15/27

 

285,000

 

 

305,737

Cimarex Energy Co., 4.375% Sr. Unsec. Nts., 3/15/29

 

236,000

 

 

245,154

Continental Resources, Inc., 4.375% Sr. Unsec. Nts., 1/15/28

 

265,000

 

 

257,659

DCP Midstream Operating LP, 5.125% Sr. Unsec. Nts.,

 

 

 

 

 

5/15/29

 

475,000

 

 

467,566

Devon Energy Corp., 4.75% Sr. Unsec. Nts., 5/15/42

 

170,000

 

 

171,782

Energy Transfer Operating LP:

 

 

 

 

 

4.25% Sr. Unsec. Nts., 3/15/23

 

435,000

 

 

460,993

5.30% Sr. Unsec. Nts., 4/15/47

 

389,000

 

 

404,125

6.625% [US0003M+415.5] Jr. Sub. Perpetual Bonds2,6

 

97,000

 

 

86,742

EnLink Midstream LLC, 5.375% Sr. Unsec. Nts., 6/1/29

 

500,000

 

 

432,601

16 INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

Principal Amount

 

 

Value

Oil, Gas & Consumable Fuels (Continued)

 

 

 

 

 

Enterprise Products Operating LLC, 3.95% Sr. Unsec. Nts.,

 

 

 

 

 

1/31/60

 

$

81,000

$

79,694

EQT Corp., 3.00% Sr. Unsec. Nts., 10/1/22

 

267,000

 

 

224,280

Kinder Morgan, Inc., 5.20% Sr. Unsec. Nts., 3/1/48

 

242,000

 

 

287,239

Marathon Petroleum Corp., 4.50% Sr. Unsec. Nts., 4/1/48

 

105,000

 

 

120,026

MPLX LP:

 

 

 

 

 

 

2.985% [US0003M+110] Sr. Unsec. Nts., 9/9/222

 

225,000

 

 

225,847

4.25% Sr. Unsec. Nts., 12/1/271

 

 

239,000

 

 

260,467

Newfield Exploration Co., 5.625% Sr. Unsec. Nts., 7/1/24

 

425,000

 

 

462,960

Occidental Petroleum Corp.:

 

 

 

 

 

 

2.90% Sr. Unsec. Nts., 8/15/24

 

 

519,000

 

 

526,359

3.50% Sr. Unsec. Nts., 8/15/29

 

 

237,000

 

 

239,319

4.50% Sr. Unsec. Nts., 7/15/44

 

 

226,000

 

 

216,156

ONEOK, Inc., 4.35% Sr. Unsec. Nts., 3/15/29

 

236,000

 

 

263,396

Rockies Express Pipeline LLC, 4.95% Sr. Unsec. Nts., 7/15/291

 

244,000

 

 

242,683

Sabine Pass Liquefaction LLC, 4.20% Sr. Sec. Nts., 3/15/28

 

705,000

 

 

745,444

Targa Resources Partners LP/Targa Resources Partners Finance

 

 

 

 

 

Corp., 6.50% Sr. Unsec. Nts., 7/15/27

 

 

500,000

 

 

521,250

Valero Energy Corp., 4.00% Sr. Unsec. Nts., 4/1/29

 

230,000

 

 

250,220

Western Midstream Operating LP, 3.10% Sr. Unsec. Nts.,

 

 

 

 

 

2/1/25

 

 

164,000

 

 

164,076

 

 

 

 

 

 

8,551,515

 

 

 

 

 

 

 

Financials—16.5%

 

 

 

 

 

 

Capital Markets—3.3%

 

 

 

 

 

 

Apollo Management Holdings LP, 4.95% [H15T5Y+326.6]

 

 

 

 

 

Sub. Nts., 1/14/501,2

 

 

350,000

 

 

352,293

Brookfield Asset Management, Inc., 4.00% Sr. Unsec. Nts.,

 

 

 

 

 

1/15/25

 

 

96,000

 

 

105,368

Carlyle Finance Subsidiary LLC, 3.50% Sr. Unsec. Nts.,

 

 

 

 

 

9/19/291

 

 

238,000

 

 

256,054

Charles Schwab Corp. (The), 5.00% [US0003M+257.5] Jr.

 

 

 

 

 

Sub. Perpetual Bonds2,6

 

 

200,000

 

 

209,163

Credit Suisse Group AG:

 

 

 

 

 

 

3.869% [US0003M+141] Sr. Unsec. Nts., 1/12/291,2

 

189,000

 

 

205,566

7.125% [USSW5+510.8] Jr. Sub. Perpetual Bonds1,2,6

 

200,000

 

 

211,348

Goldman Sachs Group, Inc. (The):

 

 

 

 

 

 

2.60% Sr. Unsec. Nts., 2/7/30

 

 

2,000,000

 

 

2,037,269

3.50% Sr. Unsec. Nts., 11/16/26

 

 

301,000

 

 

323,840

5.00% [US0003M+287.4] Jr. Sub. Perpetual Bonds2,6

 

150,000

 

 

147,489

5.15% Sub. Nts., 5/22/45

 

 

200,000

 

 

258,412

Macquarie Group Ltd., 3.763% [US0003M+137.2] Sr. Unsec.

 

 

 

 

 

Nts., 11/28/281,2

 

 

251,000

 

 

276,859

Morgan Stanley:

 

 

 

 

 

 

3.875% Sr. Unsec. Nts., 1/27/26

 

 

415,000

 

 

459,302

5.00% Sub. Nts., 11/24/25

 

 

424,000

 

 

489,560

Northern Trust Corp., 3.375% [US0003M+113.1] Sub. Nts.,

 

 

 

 

 

5/8/322

 

 

137,000

 

 

148,060

17

INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Capital Markets (Continued)

 

 

 

 

 

Raymond James Financial, Inc., 3.625% Sr. Unsec. Nts.,

 

 

 

 

 

9/15/26

$

195,000

$

215,044

State Street Corp., 5.625% [US0003M+253.9] Jr. Sub.

 

 

 

 

 

Perpetual Bonds2,6

 

135,000

 

 

141,311

UBS Group AG:

 

 

 

 

 

4.125% Sr. Unsec. Nts., 9/24/251

 

250,000

 

 

278,807

7.00% [USSW5+434.4] Jr. Sub. Perpetual Bonds1,2,6

 

125,000

 

 

133,837

 

 

 

 

 

6,249,582

 

 

 

 

 

 

Commercial Banks—8.1%

 

 

 

 

 

Australia & New Zealand Banking Group Ltd., 2.95%

 

 

 

 

 

[H15T5Y+128.8] Sub. Nts., 7/22/301,2

 

233,000

 

 

238,327

Bank of America Corp.:

 

 

 

 

 

4.271% [US0003M+131] Sr. Unsec. Nts., 7/23/292

 

188,000

 

 

216,487

6.30% [US0003M+455.3] Jr. Sub. Perpetual Bonds2,6

 

257,000

 

 

290,195

7.75% Sub. Nts., 5/14/38

 

271,000

 

 

438,816

Bank of Ireland Group plc, 4.50% Sr. Unsec. Nts., 11/25/231

 

239,000

 

 

258,901

Bank of Montreal, Series E, 3.30% Sr. Unsec. Nts., 2/5/24

 

299,000

 

 

318,666

Barclays plc:

 

 

 

 

 

7.875% [USSW5+677.2] Jr. Sub. Perpetual Bonds1,2,6

 

75,000

 

 

79,346

8.00% [H15T5Y+567.2] Jr. Sub. Perpetual Bonds2,6

 

94,000

 

 

103,465

BBVA USA, 2.50% Sr. Unsec. Nts., 8/27/24

 

388,000

 

 

397,061

BNP Paribas SA:

 

 

 

 

 

4.375% [USSW5+148.3] Sub. Nts., 3/1/331,2

 

205,000

 

 

226,758

7.625% [USSW5+631.4] Jr. Sub. Perpetual Bonds1,2,6

 

260,000

 

 

269,587

BPCE SA, 4.50% Sub. Nts., 3/15/251

 

195,000

 

 

212,350

CIT Group, Inc., 5.80% [US0003M+397.2] Jr. Sub. Perpetual

 

 

 

 

 

Bonds2,6

 

185,000

 

 

183,207

Citigroup, Inc.:

 

 

 

 

 

3.668% [US0003M+139] Sr. Unsec. Nts., 7/24/282

 

300,000

 

 

328,823

4.45% Sub. Nts., 9/29/27

 

300,000

 

 

339,296

5.00% [SOFRRATE+381.3] Jr. Sub. Perpetual Bonds2,6

 

373,000

 

 

382,398

5.95% [US0003M+390.5] Jr. Sub. Perpetual Bonds2,6

 

225,000

 

 

242,594

Citizens Bank NA (Providence RI), 2.65% Sr. Unsec. Nts.,

 

 

 

 

 

5/26/22

 

232,000

 

 

238,329

Citizens Financial Group, Inc., 6.00% [US0003M+300.3] Jr.

 

 

 

 

 

Sub. Perpetual Bonds2,6

 

91,000

 

 

92,428

Cooperatieve Rabobank UA, 2.75% Sr. Unsec. Nts., 1/10/23

 

330,000

 

 

342,719

Credit Agricole SA:

 

 

 

 

 

4.375% Sub. Nts., 3/17/251

 

355,000

 

 

388,244

8.125% [USSW5+618.5] Jr. Sub. Perpetual Bonds1,2,6

 

257,000

 

 

304,130

Danske Bank AS, 3.244% [US0003M+159.1] Sr. Unsec. Nts.,

 

 

 

 

 

12/20/251,2

 

206,000

 

 

216,614

Fifth Third Bancorp, 5.10% [US0003M+303.33] Jr. Sub.

 

 

 

 

 

Perpetual Bonds2,6

 

95,000

 

 

94,238

Fifth Third Bank (Cincinnati OH), 3.85% Sub. Nts., 3/15/26

 

150,000

 

 

165,227

HSBC Holdings plc:

 

 

 

 

 

3.95% [US0003M+98.72] Sr. Unsec. Nts., 5/18/242

 

100,000

 

 

106,519

4.583% [US0003M+153.46] Sr. Unsec. Nts., 6/19/292

 

165,000

 

 

187,543

18 INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

Principal Amount

 

 

Value

Commercial Banks (Continued)

 

 

 

 

 

 

Huntington Bancshares, Inc., 5.70% [US0003M+288] Jr. Sub.

 

 

 

 

 

Perpetual Bonds2,6

 

$

95,000

$

95,284

ING Groep NV, 6.875% [USSW5+512.4] Jr. Sub. Perpetual

 

 

 

 

 

Bonds1,2,6

 

 

270,000

 

 

283,838

JPMorgan Chase & Co.:

 

 

 

 

 

 

3.54% [US0003M+138] Sr. Unsec. Nts., 5/1/282

 

263,000

 

 

287,561

3.782% [US0003M+133.7] Sr. Unsec. Nts., 2/1/282

 

524,000

 

 

580,559

3.797% [US0003M+89] Sr. Unsec. Nts., 7/23/242

 

258,000

 

 

275,919

6.10% [US0003M+333] Jr. Sub. Perpetual Bonds2,6

 

135,000

 

 

144,356

6.125% [US0003M+333] Jr. Sub. Perpetual Bonds2,6

 

223,000

 

 

238,626

KeyBank NA (Cleveland OH), 3.40% Sub. Nts., 5/20/26

 

230,000

 

 

248,457

Lloyds Bank plc, 2.25% Sr. Unsec. Nts., 8/14/22

 

385,000

 

 

390,641

Lloyds Banking Group plc, 6.657% [US0003M+127] Jr. Sub.

 

 

 

 

 

Perpetual Bonds1,2,6

 

 

445,000

 

 

551,660

Macquarie Bank Ltd. (London), 6.125% [USSW5+370.3] Jr.

 

 

 

 

 

Sub. Perpetual Bonds1,2,6

 

 

220,000

 

 

232,559

Mitsubishi UFJ Financial Group, Inc., 3.741% Sr. Unsec. Nts.,

 

 

 

 

 

3/7/29

 

 

291,000

 

 

326,521

National Australia Bank Ltd., 3.933% [H15T5Y+188] Sub.

 

 

 

 

 

Nts., 8/2/341,2

 

 

230,000

 

 

251,617

Nordea Bank Abp:

 

 

 

 

 

 

4.625% [USSW5+169] Sub. Nts., 9/13/331,2

 

205,000

 

 

234,717

6.625% [H15T5Y+411] Jr. Sub. Perpetual Bonds1,2,6

 

200,000

 

 

221,667

PNC Bank NA, 4.05% Sub. Nts., 7/26/28

 

438,000

 

 

497,750

Royal Bank of Canada, 3.70% Sr. Unsec. Nts., 10/5/23

 

306,000

 

 

329,030

Santander Holdings USA, Inc., 3.50% Sr. Unsec. Nts., 6/7/24

 

388,000

 

 

408,270

Societe Generale SA:

 

 

 

 

 

 

3.875% Sr. Unsec. Nts., 3/28/241

 

 

374,000

 

 

401,238

7.375% [USSW5+623.8] Jr. Sub. Perpetual Bonds1,2,6

 

265,000

 

 

277,528

Synovus Financial Corp., 3.125% Sr. Unsec. Nts., 11/1/22

 

185,000

 

 

189,931

Truist Bank:

 

 

 

 

 

 

2.636% [H15T5Y+115] Sub. Nts., 9/17/292

 

584,000

 

 

593,971

3.30% Sub. Nts., 5/15/26

 

 

115,000

 

 

124,370

4.05% Sr. Unsec. Nts., 11/3/25

 

 

144,000

 

 

162,237

Truist Financial Corp., 5.125% [US0003M+278.6] Jr. Sub.

 

 

 

 

 

Perpetual Bonds2,6

 

 

191,000

 

 

198,796

US Bancorp, 3.10% Sub. Nts., 4/27/26

 

 

160,000

 

 

172,621

Wachovia Capital Trust III, 5.57% [US0003M+93] Jr. Sub.

 

 

 

 

 

Perpetual Bonds2,6

 

 

190,000

 

 

190,526

Wells Fargo & Co.:

 

 

 

 

 

 

3.584% [US0003M+131] Sr. Unsec. Nts., 5/22/282

 

223,000

 

 

242,607

4.75% Sub. Nts., 12/7/46

 

 

183,000

 

 

230,201

5.90% [US0003M+311] Jr. Sub. Perpetual Bonds, Series S2,6

 

185,000

 

 

198,515

Zions Bancorp NA, 3.25% Sub. Nts., 10/29/29

 

265,000

 

 

277,952

 

 

 

 

 

 

15,521,793

 

 

 

 

 

 

 

Consumer Finance—0.9%

 

 

 

 

 

 

American Express Co.:

 

 

 

 

 

 

3.125% Sr. Unsec. Nts., 5/20/26

 

 

289,000

 

 

314,147

19

INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Consumer Finance (Continued)

 

 

 

 

 

American Express Co.: (Continued)

 

 

 

 

 

4.90% [US0003M+328.5] Jr. Sub. Perpetual Bonds2,6

$

374,000

$

372,553

Capital One Financial Corp.:

 

 

 

 

 

3.20% Sr. Unsec. Nts., 2/5/25

 

130,000

 

 

137,582

3.80% Sr. Unsec. Nts., 1/31/28

 

135,000

 

 

147,424

Credit Acceptance Corp., 5.125% Sr. Unsec. Nts., 12/31/241

 

120,000

 

 

123,900

Discover Financial Services, 3.75% Sr. Unsec. Nts., 3/4/25

 

142,000

 

 

152,889

Synchrony Financial, 4.25% Sr. Unsec. Nts., 8/15/24

 

360,000

 

 

387,260

 

 

 

 

 

1,635,755

 

 

 

 

 

 

Diversified Financial Services—0.5%

 

 

 

 

 

Avolon Holdings Funding Ltd., 3.25% Sr. Unsec. Nts.,

 

 

 

 

 

2/15/271

 

265,000

 

 

266,145

Blackstone Holdings Finance Co. LLC, 3.15% Sr. Unsec. Nts.,

 

 

 

 

 

10/2/271

 

125,000

 

 

134,863

Credit Suisse Group Funding Guernsey Ltd., 3.80% Sr. Unsec.

 

 

 

 

 

Nts., 6/9/23

 

300,000

 

 

318,913

Equitable Holdings, Inc., 4.35% Sr. Unsec. Nts., 4/20/28

 

171,000

 

 

192,431

 

 

 

 

 

912,352

 

 

 

 

 

 

Insurance—1.7%

 

 

 

 

 

Athene Global Funding, 2.95% Sec. Nts., 11/12/261

 

455,000

 

 

479,594

Brighthouse Financial, Inc., 3.70% Sr. Unsec. Nts., 6/22/27

 

246,000

 

 

250,305

CNA Financial Corp., 3.45% Sr. Unsec. Nts., 8/15/27

 

252,000

 

 

273,267

Hartford Financial Services Group, Inc. (The), 3.817%

 

 

 

 

 

[US0003M+212.5] Jr. Sub. Nts., 2/12/471,2

 

108,000

 

 

102,789

Lincoln National Corp., 3.80% Sr. Unsec. Nts., 3/1/28

 

198,000

 

 

221,950

Manulife Financial Corp., 4.061% [USISDA05+164.7] Sub.

 

 

 

 

 

Nts., 2/24/322

 

167,000

 

 

179,770

Marsh & McLennan Cos., Inc., 4.35% Sr. Unsec. Nts., 1/30/47

 

121,000

 

 

147,385

MetLife, Inc., 5.875% [US0003M+295.9] Jr. Sub. Perpetual

 

 

 

 

 

Bonds2,6

 

100,000

 

 

111,582

Principal Financial Group, Inc., 3.70% Sr. Unsec. Nts., 5/15/29

 

284,000

 

 

323,338

Prudential Financial, Inc.:

 

 

 

 

 

3.70% Sr. Unsec. Nts., 3/13/51

 

224,000

 

 

237,417

5.20% [US0003M+304] Jr. Sub. Nts., 3/15/442

 

225,000

 

 

240,553

5.375% [US0003M+303.1] Jr. Sub. Nts., 5/15/452

 

135,000

 

 

147,639

Reliance Standard Life Global Funding II, 2.75% Sec. Nts.,

 

 

 

 

 

1/21/271

 

441,000

 

 

460,894

Willis North America, Inc., 3.875% Sr. Unsec. Nts., 9/15/49

 

113,000

 

 

121,588

 

 

 

 

 

3,298,071

 

 

 

 

 

 

Real Estate Investment Trusts (REITs)—1.9%

 

 

 

 

 

American Tower Corp., 3.60% Sr. Unsec. Nts., 1/15/28

 

830,000

 

 

897,608

Brixmor Operating Partnership LP, 4.125% Sr. Unsec. Nts.,

 

 

 

 

 

5/15/29

 

244,000

 

 

272,644

Equinix, Inc., 3.20% Sr. Unsec. Nts., 11/18/29

 

160,000

 

 

167,758

Essex Portfolio LP, 3.00% Sr. Unsec. Nts., 1/15/30

 

223,000

 

 

236,643

20 INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

Principal Amount

 

 

Value

Real Estate Investment Trusts (REITs) (Continued)

 

 

 

 

 

Healthcare Trust of America Holdings LP, 3.50% Sr. Unsec.

 

 

 

 

 

Nts., 8/1/26

$

329,000

$

356,767

Healthpeak Properties, Inc., 3.00% Sr. Unsec. Nts., 1/15/30

 

306,000

 

 

321,939

Host Hotels & Resorts LP, 3.375% Sr. Unsec. Nts., 12/15/29

 

75,000

 

 

78,190

Kite Realty Group LP, 4.00% Sr. Unsec. Nts., 10/1/26

 

326,000

 

 

338,917

Regency Centers LP, 2.95% Sr. Unsec. Nts., 9/15/29

 

340,000

 

 

360,680

Spirit Realty LP, 3.20% Sr. Unsec. Nts., 1/15/27

 

314,000

 

 

330,774

Welltower, Inc., 2.70% Sr. Unsec. Nts., 2/15/27

 

210,000

 

 

218,269

 

 

 

 

 

3,580,189

 

 

 

 

 

 

Thrifts & Mortgage Finance—0.1%

 

 

 

 

 

Nationwide Building Society, 3.96% [US0003M+185.5] Sr.

 

 

 

 

 

Unsec. Nts., 7/18/301,2

 

229,000

 

 

253,581

 

 

 

 

 

 

Health Care—3.1%

 

 

 

 

 

Biotechnology—0.9%

 

 

 

 

 

AbbVie, Inc.:

 

 

 

 

 

2.95% Sr. Unsec. Nts., 11/21/261

 

117,000

 

 

122,757

3.20% Sr. Unsec. Nts., 11/21/291

 

553,000

 

 

584,461

3.60% Sr. Unsec. Nts., 5/14/25

 

383,000

 

 

413,406

4.05% Sr. Unsec. Nts., 11/21/391

 

133,000

 

 

147,143

4.875% Sr. Unsec. Nts., 11/14/48

 

205,000

 

 

252,655

Amgen, Inc., 4.563% Sr. Unsec. Nts., 6/15/48

 

140,000

 

 

167,436

 

 

 

 

 

1,687,858

 

 

 

 

 

 

Health Care Equipment & Supplies—0.4%

 

 

 

 

 

Becton Dickinson & Co., 3.70% Sr. Unsec. Nts., 6/6/27

 

267,000

 

 

295,114

Hologic, Inc., 4.375% Sr. Unsec. Nts., 10/15/251

 

508,000

 

 

518,432

 

 

 

 

 

813,546

 

 

 

 

 

 

Health Care Providers & Services—0.9%

 

 

 

 

 

Cigna Corp., 4.375% Sr. Unsec. Nts., 10/15/28

 

378,000

 

 

430,286

CVS Health Corp., 5.05% Sr. Unsec. Nts., 3/25/48

 

302,000

 

 

372,219

Fresenius Medical Care US Finance II, Inc., 5.875% Sr. Unsec.

 

 

 

 

 

Nts., 1/31/221

 

425,000

 

 

456,575

HCA, Inc., 5.375% Sr. Unsec. Nts., 2/1/25

 

460,000

 

 

509,489

 

 

 

 

 

1,768,569

 

 

 

 

 

 

Life Sciences Tools & Services—0.3%

 

 

 

 

 

IQVIA, Inc., 5.00% Sr. Unsec. Nts., 10/15/261

 

490,000

 

 

506,625

 

 

 

 

 

 

Pharmaceuticals—0.6%

 

 

 

 

 

Elanco Animal Health, Inc., 5.65% Sr. Unsec. Nts., 8/28/28

 

356,000

 

 

408,078

Mylan, Inc., 3.125% Sr. Unsec. Nts., 1/15/231

 

470,000

 

 

487,666

Takeda Pharmaceutical Co. Ltd., 5.00% Sr. Unsec. Nts.,

 

 

 

 

 

11/26/28

 

247,000

 

 

300,936

 

 

 

 

 

1,196,680

21 INVESCO INTERMEDIATE BOND FACTOR FUND

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Industrials—4.1%

 

 

 

 

 

Aerospace & Defense—0.8%

 

 

 

 

 

BAE Systems Holdings, Inc., 3.85% Sr. Unsec. Nts., 12/15/251

$

373,000

$

410,401

Northrop Grumman Corp., 4.75% Sr. Unsec. Nts., 6/1/43

 

450,000

 

 

584,987

United Technologies Corp., 4.625% Sr. Unsec. Nts., 11/16/48

 

405,000

 

 

544,614

 

 

 

 

 

1,540,002

 

 

 

 

 

 

Airlines—0.4%

 

 

 

 

 

Delta Air Lines, Inc., 2.90% Sr. Unsec. Nts., 10/28/24

 

615,000

 

 

620,340

United Airlines Pass Through Trust, Series 2019-2, 2.70%,

 

 

 

 

 

5/1/32

 

224,000

 

 

240,218

 

 

 

 

 

860,558

 

 

 

 

 

 

Building Products—0.4%

 

 

 

 

 

Fortune Brands Home & Security, Inc.:

 

 

 

 

 

3.25% Sr. Unsec. Nts., 9/15/29

 

231,000

 

 

244,372

4.00% Sr. Unsec. Nts., 9/21/23

 

473,000

 

 

512,257

 

 

 

 

 

756,629

 

 

 

 

 

 

Industrial Conglomerates—0.4%

 

 

 

 

 

GE Capital International Funding Co. Unlimited Co., 3.373%

 

 

 

 

 

Sr. Unsec. Nts., 11/15/25

 

252,000

 

 

268,823

General Electric Co., 2.70% Sr. Unsec. Nts., 10/9/22

 

480,000

 

 

490,708

 

 

 

 

 

759,531

 

 

 

 

 

 

Machinery—0.5%

 

 

 

 

 

nVent Finance Sarl, 4.55% Sr. Unsec. Nts., 4/15/28

 

832,000

 

 

916,549

 

 

 

 

 

 

Professional Services—0.2%

 

 

 

 

 

IHS Markit Ltd., 4.125% Sr. Unsec. Nts., 8/1/23

 

326,000

 

 

349,462

 

 

 

 

 

 

Road & Rail—0.7%

 

 

 

 

 

Penske Truck Leasing Co. LP/PTL Finance Corp., 3.40% Sr.

 

 

 

 

 

Unsec. Nts., 11/15/261

 

759,000

 

 

802,823

United Rentals North America, Inc., 4.625% Sr. Unsec. Nts.,

 

 

 

 

 

10/15/25

 

515,000

 

 

522,939

 

 

 

 

 

1,325,762

 

 

 

 

 

 

Trading Companies & Distributors—0.7%

 

 

 

 

 

AerCap Ireland Capital DAC/AerCap Global Aviation Trust,

 

 

 

 

 

3.50% Sr. Unsec. Nts., 5/26/22

 

443,000

 

 

455,580

Air Lease Corp., 3.00% Sr. Unsec. Nts., 2/1/30

 

560,000

 

 

554,005

GATX Corp., 3.50% Sr. Unsec. Nts., 3/15/28

 

249,000

 

 

266,186

 

 

 

 

 

1,275,771

 

 

 

 

 

 

Information Technology—2.7%

 

 

 

 

 

Communications Equipment—0.5%

 

 

 

 

 

Motorola Solutions, Inc., 4.60% Sr. Unsec. Nts., 2/23/28

 

799,000

 

 

902,990

22 INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

Principal Amount

 

 

Value

Electronic Equipment, Instruments, & Components—0.3%

 

 

 

 

 

Corning, Inc., 5.35% Sr. Unsec. Nts., 11/15/48

$

400,000

$

517,359

 

 

 

 

 

 

 

IT Services—1.0%

 

 

 

 

 

 

DXC Technology Co., 4.75% Sr. Unsec. Nts., 4/15/27

 

379,000

 

 

414,996

Fiserv, Inc., 3.50% Sr. Unsec. Nts., 7/1/29

 

347,000

 

 

380,014

Global Payments, Inc., 3.20% Sr. Unsec. Nts., 8/15/29

 

230,000

 

 

244,623

ILFC E-Capital Trust I, 3.90% [30YR CMT+155], 12/21/651,2

 

185,000

 

 

146,473

VeriSign, Inc.:

 

 

 

 

 

 

4.75% Sr. Unsec. Nts., 7/15/27

 

 

495,000

 

 

516,547

5.25% Sr. Unsec. Nts., 4/1/25

 

 

271,000

 

 

294,329

 

 

 

 

 

 

1,996,982

 

 

 

 

 

 

Semiconductors & Semiconductor Equipment—0.2%

 

 

 

 

 

NXP BV/NXP Funding LLC/NXP USA, Inc., 4.30% Sr. Unsec.

 

 

 

 

 

Nts., 6/18/291

 

 

370,000

 

 

415,242

 

 

 

 

 

 

 

Software—0.4%

 

 

 

 

 

 

Autodesk, Inc., 4.375% Sr. Unsec. Nts., 6/15/25

 

430,000

 

 

485,969

VMware, Inc., 3.90% Sr. Unsec. Nts., 8/21/27

 

251,000

 

 

270,194

 

 

 

 

 

 

756,163

 

 

 

 

 

 

Technology Hardware, Storage & Peripherals—0.3%

 

 

 

 

 

Dell International LLC/EMC Corp., 5.30% Sr. Sec. Nts.,

 

 

 

 

 

10/1/291

 

 

467,000

 

 

538,414

 

 

 

 

 

 

 

Materials—3.3%

 

 

 

 

 

 

Chemicals—0.3%

 

 

 

 

 

 

CF Industries, Inc., 3.45% Sr. Unsec. Nts., 6/1/23

 

139,000

 

 

141,086

Dow Chemical Co. (The), 3.625% Sr. Unsec. Nts., 5/15/26

 

316,000

 

 

344,265

Nutrien Ltd., 5.00% Sr. Unsec. Nts., 4/1/49

 

126,000

 

 

157,053

 

 

 

 

 

 

642,404

 

 

 

 

 

 

 

Construction Materials—0.5%

 

 

 

 

 

 

Martin Marietta Materials, Inc., 3.50% Sr. Unsec. Nts.,

 

 

 

 

 

12/15/27

 

 

771,000

 

 

846,062

 

 

 

 

 

 

 

Containers & Packaging—1.4%

 

 

 

 

 

 

Ball Corp., 4.875% Sr. Unsec. Nts., 3/15/26

 

485,000

 

 

534,397

International Paper Co., 4.80% Sr. Unsec. Nts., 6/15/44

 

280,000

 

 

333,729

Packaging Corp. of America, 3.65% Sr. Unsec. Nts., 9/15/24

 

223,000

 

 

241,961

Sealed Air Corp., 5.50% Sr. Unsec. Nts., 9/15/251

 

425,000

 

 

466,614

Silgan Holdings, Inc., 4.75% Sr. Unsec. Nts., 3/15/25

 

660,000

 

 

669,626

WRKCo, Inc., 3.90% Sr. Unsec. Nts., 6/1/28

 

289,000

 

 

318,532

 

 

 

 

 

 

2,564,859

 

 

 

 

 

 

 

Metals & Mining—0.7%

 

 

 

 

 

 

Anglo American Capital plc, 3.625% Sr. Unsec. Nts., 9/11/241

 

356,000

 

 

380,786

ArcelorMittal SA, 4.25% Sr. Unsec. Nts., 7/16/29

 

240,000

 

 

250,105

Newmont Corp., 2.80% Sr. Unsec. Nts., 10/1/29

 

231,000

 

 

240,686

23

INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

SCHEDULE OF INVESTMENTS Continued

 

 

Principal Amount

 

 

Value

Metals & Mining (Continued)

 

 

 

 

 

Steel Dynamics, Inc., 4.125% Sr. Unsec. Nts., 9/15/25

$

524,000

$

538,061

 

 

 

 

 

1,409,638

 

 

 

 

 

 

Paper & Forest Products—0.4%

 

 

 

 

 

Louisiana-Pacific Corp., 4.875% Sr. Unsec. Nts., 9/15/24

 

811,000

 

 

829,584

 

 

 

 

 

 

Telecommunication Services—1.5%

 

 

 

 

 

Diversified Telecommunication Services—1.3%

 

 

 

 

 

AT&T, Inc., 4.50% Sr. Unsec. Nts., 3/9/48

 

545,000

 

 

622,316

Qwest Corp., 6.75% Sr. Unsec. Nts., 12/1/21

 

470,000

 

 

497,171

T-Mobile USA, Inc., 6.50% Sr. Unsec. Nts., 1/15/26

 

445,000

 

 

469,319

Verizon Communications, Inc., 4.522% Sr. Unsec. Nts.,

 

 

 

 

 

9/15/48

 

717,000

 

 

925,634

 

 

 

 

 

2,514,440

 

 

 

 

 

 

Wireless Telecommunication Services—0.2%

 

 

 

 

 

Vodafone Group plc:

 

 

 

 

 

6.15% Sr. Unsec. Nts., 2/27/37

 

150,000

 

 

202,934

7.00% [USSW5+487.3] Jr. Sub. Nts., 4/4/792

 

217,000

 

 

250,806

 

 

 

 

 

453,740

 

 

 

 

 

 

Utilities—3.5%

 

 

 

 

 

Electric Utilities—2.9%

 

 

 

 

 

AEP Texas, Inc., 3.95% Sr. Unsec. Nts., 6/1/281

 

806,000

 

 

920,720

Berkshire Hathaway Energy Co., 3.80% Sr. Unsec. Nts.,

 

 

 

 

 

7/15/48

 

368,000

 

 

423,216

EDP Finance BV, 3.625% Sr. Unsec. Nts., 7/15/241

 

349,000

 

 

372,980

Exelon Corp., 4.45% Sr. Unsec. Nts., 4/15/46

 

146,000

 

 

177,119

FirstEnergy Corp., 3.90% Sr. Unsec. Nts., 7/15/27

 

560,000

 

 

620,636

Fortis, Inc., 3.055% Sr. Unsec. Nts., 10/4/26

 

186,000

 

 

197,515

ITC Holdings Corp., 5.30% Sr. Unsec. Nts., 7/1/43

 

323,000

 

 

438,453

NextEra Energy Capital Holdings, Inc., 5.65%

 

 

 

 

 

[US0003M+315.6] Jr. Sub. Nts., 5/1/792

 

403,000

 

 

458,130

NextEra Energy Operating Partners LP, 4.25% Sr. Unsec. Nts.,

 

 

 

 

 

9/15/241

 

514,000

 

 

518,515

PPL WEM Ltd./Western Power Distribution plc, 5.375% Sr.

 

 

 

 

 

Unsec. Nts., 5/1/211

 

500,000

 

 

516,045

Virginia Electric & Power Co., 4.45% Sr. Unsec. Nts., 2/15/44

 

325,000

 

 

402,861

Vistra Operations Co. LLC, 5.625% Sr. Unsec. Nts., 2/15/271

 

460,000

 

 

472,351

 

 

 

 

 

5,518,541

 

 

 

 

 

 

Independent Power and Renewable Electricity Producers—0.1%

 

 

 

 

 

NRG Energy, Inc., 4.45% Sr. Sec. Nts., 6/15/291

 

242,000

 

 

261,845

 

 

 

 

 

 

Multi-Utilities—0.5%

 

 

 

 

 

Ameren Corp., 2.50% Sr. Unsec. Nts., 9/15/24

 

314,000

 

 

323,683

CenterPoint Energy, Inc., 4.25% Sr. Unsec. Nts., 11/1/28

 

215,000

 

 

246,324

24 INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

Principal Amount

 

 

Value

Multi-Utilities (Continued)

 

 

 

 

 

 

Sempra Energy, 3.40% Sr. Unsec. Nts., 2/1/28

$

265,000

$

286,067

 

 

 

 

 

 

856,074

Total Corporate Bonds and Notes (Cost $90,334,228)

 

 

 

 

97,811,841

 

 

 

Shares

 

 

 

Preferred Stocks—2.0%

 

 

 

 

 

 

Allstate Corp. (The), 5.625% Non-Cum., Series G, Non-Vtg.

 

4,150

 

 

108,688

American Homes 4 Rent, 6.35% Cum., Non-Vtg.

 

3,600

 

 

93,168

Arch Capital Group Ltd., 5.25% Non-Cum., Non-Vtg.

 

4,025

 

 

100,665

AT&T, Inc., 5.625% Sr. Unsec.

 

 

3,625

 

 

94,395

Citigroup Capital XIII, 8.14% Cum., Non-Vtg.,

 

 

 

 

 

[US0003M+637]2

 

 

6,850

 

 

185,840

Citizens Financial Group, Inc., 6.35% Non-Cum., Series D,

 

 

 

 

 

Non-Vtg., [US0003M+364.2]2

 

 

5,689

 

 

153,091

CMS Energy Corp., 5.875% Jr. Sub.

 

 

3,600

 

 

94,248

Digital Realty Trust, Inc., 5.25% Cum., Series J, Non-Vtg.

 

4,450

 

 

112,451

DTE Energy Co., 5.375% Jr. Sub., Non-Vtg.

 

3,725

 

 

93,311

Duke Energy Corp., 5.125% Jr. Sub.

 

 

3,775

 

 

94,677

eBay, Inc., 6.00% Sr. Unsec.

 

 

3,500

 

 

90,265

Entergy Louisiana LLC , 5.25% Sec.

 

 

3,750

 

 

93,450

Entergy Texas, Inc., 5.625% First Mortgage Sec.

 

3,550

 

 

90,205

Fifth Third Bancorp, 6.625% Non-Cum., Non-Vtg.

 

 

 

 

 

[US0003M+371]2

 

 

3,325

 

 

89,775

GMAC Capital Trust I, 7.477% Jr. Sub., Non-Vtg.,[US000

 

 

 

 

 

3M+578.5]2

 

 

7,150

 

 

182,325

Goldman Sachs Group, Inc. (The), 6.30% Non-Cum., Series

 

 

 

 

 

N, Non-Vtg.

 

 

7,000

 

 

180,670

Huntington Bancshares, Inc., 6.25% Non-Cum., Non-Vtg.

 

5,500

 

 

141,570

JPMorgan Chase & Co., 6.00% Non-Cum., Series EE,

 

 

 

 

 

Non-Vtg.

 

 

3,900

 

 

104,286

KeyCorp, 6.125% Non-Cum., Series E, Non-Vtg.

 

 

 

 

 

[US0003M+389.2]2

 

 

5,300

 

 

141,563

Morgan Stanley, 5.85% Non-Cum., Non-Vtg.

 

 

 

 

 

[US0003M+349.1]2

 

 

4,475

 

 

118,856

Morgan Stanley, 6.375% Non-Cum., Non-Vtg.

 

 

 

 

 

[US0003M+370.8]2

 

 

6,850

 

 

186,183

NiSource, Inc., 6.50% Cum., Series B, Non-Vtg.

 

 

 

 

 

[H15T5Y+363.2]2

 

 

3,575

 

 

93,987

PNC Financial Services Group, Inc. (The), 6.125% Non-Cum.,

 

 

 

 

 

Series P, Non-Vtg. [US0003M+406.7]2

 

 

5,200

 

 

138,268

PPL Capital Funding, Inc., 5.90% Jr. Sub., Series B

 

3,650

 

 

91,287

Prudential Financial, Inc., 5.75% Jr. Sub.

 

 

3,750

 

 

95,100

Public Storage, 5.20% Cum., Series X, Non-Vtg.

 

4,350

 

 

109,838

Qwest Corp., 7.00% Sr. Unsec.

 

 

4,250

 

 

110,160

Regions Financial Corp., 5.70% Non-Cv., Series C, Non-Vtg.

 

 

 

 

 

[US0003M+314.8]2

 

 

3,700

 

 

101,454

Synovus Financial Corp., 5.875% Non-Cum., Series E, Non-

 

 

 

 

 

Vtg., 5.875% [H15T5Y+412.7]2

 

 

3,900

 

 

101,283

Synovus Financial Corp., 6.30% Non-Cum., Series D, Non-

 

 

 

 

 

Vtg., [US0003M+335.2]2

 

 

3,675

 

 

95,183

25

INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

SCHEDULE OF INVESTMENTS Continued

 

Shares

 

 

Value

Preferred Stocks (Continued)

 

 

 

 

US Bancorp, 6.50% Non-Cum., Series F, Non-Vtg.

 

 

 

 

[US0003M+446.8]2

6,825

$

181,204

Vornado Realty Trust, 5.70% Cum., Series B, Non-Vtg.

3,700

 

 

93,092

Wells Fargo & Co., 6.625% Non-Cum., Non-Vtg.

 

 

 

 

[US0003M+369]2

3,350

 

 

91,891

Total Preferred Stocks (Cost $3,819,229)

 

 

 

3,852,429

 

 

 

 

 

Investment Companies—19.1%

 

 

 

 

Invesco Liquid Assets Portfolio, Institutional Class, 1.64%7 (Cost

 

 

 

 

$36,479,123)

36,463,571

 

 

36,463,571

Total Investments, at Value (Cost $187,208,416)

102.9%

 

 

196,144,376

Net Other Assets (Liabilities)

(2.9)

 

 

(5,455,760)

Net Assets

100.0%

$

190,688,616

 

 

 

 

 

Footnotes to Schedule of Investments

1.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 February 29, 2020 was $29,188,598, which represented 15.31% of the Fund's Net Assets.

2.Represents the current interest rate for a variable or increasing rate security, which may be fixed for a predetermined period. The interest rate is, or will be as of an established date, determined as [Referenced Rate + Basis-point spread].

3.Interest-Only Strips represent the right to receive the monthly interest payments on an underlying pool of mortgage loans. These securities typically decline in price as interest rates decline. Most other fixed income securities increase in price when interest rates decline. The principal amount of the underlying pool represents the notional amount on which current interest is calculated. The price of these securities is typically more sensitive to changes in prepayment rates than traditional mortgage-backed securities (for example, GNMA pass-throughs). Interest rates disclosed represent current yields based upon the current cost basis and estimated timing and amount of future cash flows. These securities amount to $1,779,040 or 0.93% of the Fund's net assets at period end.

4.Interest rate is less than 0.0005%.

5.This interest rate resets periodically. Interest rate shown reflects the rate in effect at period end. The rate on this variable rate security is not based on a published reference rate and spread but is determined by the issuer or agent based on current market conditions.

6.This bond has no contractual maturity date, is not redeemable and contractually pays an indefinite stream of interest.

7.The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the

7-day SEC standardized yield as of February 29, 2020.

This security was an affiliate, as defined in the Investment Company Act of 1940, as amended, at or during the reporting period, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. There were no affiliate securities held by the Fund at period end. Transactions during the reporting period in which the issuer was an affiliate are as follows:

26 INVESCO INTERMEDIATE BOND FACTOR FUND

Footnotes to Schedule of Investments (Continued)

 

 

 

 

Shares

 

Shares

Gross

Gross

February 29,

 

July 31, 2019

Additions

Reductions

2020

Investment Company

 

 

 

 

Invesco Oppenheimer Master Loan

 

 

 

 

Fund

590,695

2,817

593,512

 

 

 

 

 

 

 

 

 

Change in

 

 

 

 

Investment

 

Realized

 

 

Unrealized

 

 

 

Value

Income

Gain (Loss)

 

 

Gain (Loss)

Investment Company

 

 

 

 

 

 

 

 

 

Invesco Oppenheimer Master Loan

$

— $

 

 

 

 

 

 

 

Fund

 

232,679

$

(341,755)

$

 

(332,931)

 

 

 

 

 

 

 

 

 

Futures Contracts as of February 29, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized

 

 

Expiration

Number Notional Amount

 

 

 

Appreciation/

Description

Buy/Sell

Date

of Contracts

(000's)

Value

(Depreciation)

United States

 

 

 

 

 

 

 

 

 

 

Treasury Long

 

 

 

 

 

 

 

 

 

 

Bonds

Buy

6/19/20

173

USD 28,864

29,453,250

 

588,906

 

United States

 

 

 

 

 

 

 

 

 

 

Treasury Nts., 10 yr.

Sell

6/19/20

229

USD 30,503

30,857,750

 

(355,097)

 

United States

 

 

 

 

 

 

 

 

 

 

Treasury Nts., 2 yr.

Buy

6/30/20

115

USD 24,984

25,107,734

 

123,758

 

United States

 

 

 

 

 

 

 

 

 

 

Treasury Nts., 5 yr.

Sell

6/30/20

10

USD 1,216

1,227,500

 

(11,504)

 

United States Ultra

 

 

 

 

 

 

 

 

 

 

Bonds

Buy

6/19/20

14

USD 2,828

2,905,000

 

76,750

 

 

 

 

 

 

 

 

$

422,813

 

Definitions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30YR CMT

30 Year Constant Maturity Treasury

 

 

 

 

 

 

 

H15T5Y

US Treasury Yield Curve Rate T Note Constant Maturity 5 Year

 

 

 

 

 

ICE LIBOR

Intercontinental Exchange London Interbank Offered Rate

 

 

 

 

 

SOFRRATE

United States Overnight Secured Financing

 

 

 

 

 

 

 

US0001M

ICE LIBOR USD 1 Month

 

 

 

 

 

 

 

 

US0003M

ICE LIBOR USD 3 Month

 

 

 

 

 

 

 

 

USISDA05

USD ICE Swap Rate 11:00am NY 5 Year

 

 

 

 

 

 

 

USSW5

USD Swap Semi 30/360 5 Year

 

 

 

 

 

 

 

See accompanying Notes to Financial Statements.

27 INVESCO INTERMEDIATE BOND FACTOR FUND

STATEMENT OF ASSETS AND LIABILITIES February 29, 2020

Assets

 

 

Investments, at value—see accompanying schedule of investments:

 

 

Unaffiliated companies (cost $150,729,293)

$

159,680,805

Affiliated companies (cost $36,479,123)

 

36,463,571

 

 

196,144,376

Cash

 

500,004

Receivables and other assets:

 

 

Shares of beneficial interest sold

 

2,757,138

Interest and dividends

 

1,232,414

Variation margin receivable - futures contracts

 

796,305

Other

 

133,998

Total assets

 

201,564,235

 

 

 

Liabilities

 

 

Payables and other liabilities:

 

 

Investments purchased

 

9,847,828

Shares of beneficial interest redeemed

 

583,766

Transfer and shareholder servicing agent fees

 

101,886

Advisory fees

 

57,401

Distribution and service plan fees

 

49,200

Shareholder communications

 

38,599

Trustees' compensation

 

28,333

Administration fees

 

2,276

Dividends

 

1,211

Other

 

165,119

Total liabilities

 

10,875,619

 

 

 

Net Assets

$

190,688,616

 

 

 

 

 

 

Composition of Net Assets

 

 

Shares of beneficial interest

$

182,615,502

Total distributable earnings

 

8,073,114

Net Assets

$

190,688,616

 

 

 

28 INVESCO INTERMEDIATE BOND FACTOR FUND

Net Asset Value Per Share

Class A Shares:

 

Net asset value and redemption price per share (based on net assets of $122,371,141 and

 

10,861,035 shares of beneficial interest outstanding)

$11.27

Maximum offering price per share (net asset value plus sales charge of 4.25% of offering price)

$11.77

 

 

Class C Shares:

 

Net asset value, redemption price (excludes applicable contingent deferred sales charge)

 

and offering price per share (based on net assets of $23,113,955 and 2,052,635 shares of

 

beneficial interest outstanding)

$11.26

 

 

Class R Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of

 

$20,366,326 and 1,806,681 shares of beneficial interest outstanding)

$11.27

 

 

Class Y Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of

 

$19,031,887 and 1,690,126 shares of beneficial interest outstanding)

$11.26

 

 

Class R5 Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of $10,559

 

and 937 shares of beneficial interest outstanding)

$11.27

 

 

Class R6 Shares:

 

Net asset value, redemption price and offering price per share (based on net assets of

 

$5,794,748 and 514,354 shares of beneficial interest outstanding)

$11.27

See accompanying Notes to Financial Statements.

29 INVESCO INTERMEDIATE BOND FACTOR FUND

STATEMENT

OF OPERATIONS

 

Seven Months Ended

 

Year Ended

 

 

February 29, 2020

 

July 31, 2019

Investment Income

 

 

 

 

Interest:

 

 

 

 

Unaffiliated companies

$

3,483,958

$

7,030,711

Affiliated companies

 

145,599

 

Dividends:

 

 

 

 

Unaffiliated companies

 

130,176

 

89,144

Affiliated companies

 

160,614

 

235,865

 

 

 

 

 

Total investment income

 

3,920,347

 

7,355,720

 

 

 

 

 

Expenses

 

 

 

 

Advisory fees

 

427,133

 

812,097

Administration fees

 

16,017

 

2,259

Distribution and service plan fees:

 

 

 

 

Class A

 

169,255

 

277,311

Class C

 

133,709

 

280,803

Class R

 

60,189

 

98,368

Transfer and shareholder servicing agent fees:

 

 

 

 

Class A

 

184,173

 

213,539

Class C

 

35,010

 

52,327

Class R

 

31,522

 

37,360

Class Y

 

31,356

 

43,583

Class R5

 

4

 

1

Class R6

 

1,223

 

2,188

Shareholder communications:

 

 

 

 

Class A

 

28,531

 

23,378

Class C

 

5,397

 

6,654

Class R

 

4,878

 

4,679

Class Y

 

4,800

 

6,893

Class R5

 

2

 

1

Class R6

 

1,392

 

1,019

Legal, auditing and other professional fees

 

38,357

 

105,184

Custodian fees and expenses

 

19,740

 

30,304

Trustees' compensation

 

10,283

 

14,147

Borrowing fees

 

 

4,561

Other

 

50,010

 

20,039

Total expenses

 

1,252,981

 

2,036,695

Less waivers and reimbursements of expenses

 

(319,953)

 

(347,536)

Net expenses

 

933,028

 

1,689,159

 

 

 

 

 

Net Investment Income

 

2,987,319

 

5,666,561

30 INVESCO INTERMEDIATE BOND FACTOR FUND

 

Seven Months Ended

 

Year Ended

 

 

February 29, 2020

 

July 31, 2019

Realized and Unrealized Gain (Loss)

 

 

 

 

Net realized gain (loss) on:

 

 

 

 

Investment transactions in:

 

 

 

 

Unaffiliated companies

$

2,036,454

$

(2,238,072)

Affiliated companies

 

(342,008)

 

(259,077)

Futures contracts

 

2,570,477

 

697,947

Swap contracts

 

(803,274)

 

55,232

Net realized gain (loss)

 

3,461,649

 

(1,743,970)

 

 

 

 

 

Net change in unrealized appreciation/(depreciation) on:

 

 

 

 

Investment transactions in:

 

 

 

 

Unaffiliated companies

 

3,363,532

 

8,975,554

Affiliated companies

 

(348,483)

 

543,799

Futures contracts

 

(367,064)

 

622,145

Swap contracts

 

632,630

 

(632,630)

Net change in unrealized appreciation/(depreciation)

 

3,280,615

 

9,508,868

 

 

 

 

 

Net Increase in Net Assets Resulting from Operations

$

9,729,583

$

13,431,459

 

 

 

 

 

See accompanying Notes to Financial Statements.

31 INVESCO INTERMEDIATE BOND FACTOR FUND

STATEMENT OF CHANGES IN NET ASSETS

 

 

Seven Months

 

 

 

 

 

 

Ended

 

Year Ended

 

Year Ended

 

 

February 29, 2020

 

July 31, 2019

 

July 31, 2018

Operations

 

 

 

 

 

 

Net investment income

$

2,987,319

$

5,666,561

$

5,872,996

 

 

 

 

 

 

 

Net realized gain (loss)

 

3,461,649

 

(1,743,970)

 

(343,007)

 

 

 

 

 

 

 

Net change in unrealized appreciation/(depreciation)

 

3,280,615

 

9,508,868

 

(9,492,140)

Net increase (decrease) in net assets resulting from

 

 

 

 

 

 

operations

 

9,729,583

 

13,431,459

 

(3,962,151)

 

 

 

 

 

 

 

Dividends and/or Distributions to Shareholders

 

 

 

 

 

 

Distributions to shareholders from distributable

 

 

 

 

 

 

earnings:

 

 

 

 

 

 

Class A

 

(2,103,408)

 

(3,454,780)

 

(3,761,706)

Class C

 

(268,610)

 

(618,547)

 

(711,506)

Class R

 

(296,036)

 

(537,255)

 

(480,402)

Class Y

 

(408,127)

 

(780,401)

 

(749,702)

Class R5

 

(189)

 

(57)

 

Class R6

 

(114,051)

 

(240,155)

 

(186,507)

Total distributions from distributable earnings

 

 

 

 

 

 

 

(3,190,421)

 

(5,631,195)

 

(5,889,823)

 

 

 

 

 

 

 

Beneficial Interest Transactions

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from

 

 

 

 

 

 

beneficial interest transactions:

 

 

 

 

 

 

Class A

 

(1,109,919)

 

(4,592,048)

 

(4,812,097)

Class C

 

(1,180,162)

 

(8,897,146)

 

(637,324)

Class R

 

(866,522)

 

251,717

 

4,944,820

Class Y

 

(2,535,892)

 

(7,267,938)

 

10,822,468

Class R5

 

 

10,000

 

Class R6

 

(67,919)

 

(2,393,472)

 

5,873,003

Total beneficial interest transactions

 

 

 

 

 

 

 

(5,760,414)

 

(22,888,887)

 

16,190,870

 

 

 

 

 

 

 

Net Assets

 

 

 

 

 

 

Total increase (decrease)

 

778,748

 

(15,088,623)

 

6,338,896

 

 

 

 

 

 

 

Beginning of period

 

189,909,868

 

204,998,491

 

198,659,595

End of period

 

 

 

 

 

 

$

190,688,616

$

189,909,868

$

204,998,491

 

 

 

 

 

 

 

See accompanying Notes to Financial Statements.

32 INVESCO INTERMEDIATE BOND FACTOR FUND

FINANCIAL HIGHLIGHTS

Class A

Seven Months Ended

February 29, Year Ended Year Ended Year Ended Year Ended Year Ended 2020 July 31, 2019 July 31, 2018 July 31, 2017 July 31, 2016 July 31, 2015

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$10.88

$10.43

$10.92

$11.03

$10.66

$10.90

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income1

0.18

0.32

0.31

0.29

0.30

0.33

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.40

0.45

(0.49)

(0.10)

0.37

(0.24)

Total from investment

 

 

 

 

 

 

operations

0.58

0.77

(0.18)

0.19

0.67

0.09

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.19)

(0.32)

(0.31)

(0.30)

(0.30)

(0.33)

Net asset value, end of period

$11.27

$10.88

$10.43

$10.92

$11.03

$10.66

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value2

5.39%

7.52%

(1.67)%

1.82%

6.45%

0.84%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$122,371

$119,300

$119,119

$129,985

$139,018

$103,315

Average net assets (in

 

 

 

 

 

 

thousands)

$120,943

$113,850

$129,767

$132,043

$125,116

$101,748

Ratios to average net assets:3,4

 

 

 

 

 

 

Net investment income

2.80%

3.07%

2.89%

2.68%

2.83%

3.07%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

1.05%

0.97%

0.97%

1.00%

1.02%

1.01%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%5

Total expenses6

1.05%

0.97%

0.97%

1.00%

1.02%

1.01%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

0.73%

0.75%

0.95%

0.97%

1.00%

1.00%

Portfolio turnover rate7

64%8

108%8

57%

80%

73%

100%

33 INVESCO INTERMEDIATE BOND FACTOR FUND

FINANCIAL HIGHLIGHTS Continued

1.Calculated based on the average shares outstanding during the period.

2.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.

3.Annualized for periods less than one full year.

4.Includes the Fund's share of the allocated expenses and/or net investment income from the master funds.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Seven Months Ended February 29, 2020

1.07%

Year Ended July 31, 2019

0.99%

Year Ended July 31, 2018

0.99%

Year Ended July 31, 2017

1.02%

Year Ended July 31, 2016

1.03%

Year Ended July 31, 2015

1.02%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

8.The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

 

Purchase Transactions

Sale Transactions

Seven Months Ended February 29, 2020

$11,531,839

$13,476,801

Year Ended July 31, 2019

$129,169,490

$127,412,648

See accompanying Notes to Financial Statements.

34 INVESCO INTERMEDIATE BOND FACTOR FUND

Class C

Seven Months Ended

February 29, Year Ended Year Ended Year Ended Year Ended Year Ended 2020 July 31, 2019 July 31, 2018 July 31, 2017 July 31, 2016 July 31, 2015

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$10.87

$10.43

$10.91

$11.03

$10.65

$10.89

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income1

0.12

0.23

0.23

0.21

0.22

0.25

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.40

0.44

(0.48)

(0.11)

0.38

(0.24)

Total from investment

 

 

 

 

 

 

operations

0.52

0.67

(0.25)

0.10

0.60

0.01

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.13)

(0.23)

(0.23)

(0.22)

(0.22)

(0.25)

Net asset value, end of period

$11.26

$10.87

$10.43

$10.91

$11.03

$10.65

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value2

4.80%

6.52%

(2.32)%

0.97%

5.76%

0.08%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$23,114

$23,487

$31,250

$33,420

$38,261

$27,706

Average net assets (in

 

 

 

 

 

 

thousands)

$22,977

$28,132

$33,138

$35,836

$31,800

$24,595

Ratios to average net assets:3,4

 

 

 

 

 

 

Net investment income

1.90%

2.17%

2.14%

1.92%

2.07%

2.32%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

1.81%

1.72%

1.72%

1.75%

1.77%

1.78%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%5

Total expenses6

1.81%

1.72%

1.72%

1.75%

1.77%

1.78%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

1.63%

1.65%

1.70%

1.72%

1.75%

1.75%

Portfolio turnover rate7

64%8

108%8

57%

80%

73%

100%

35 INVESCO INTERMEDIATE BOND FACTOR FUND

FINANCIAL HIGHLIGHTS Continued

1.Calculated based on the average shares outstanding during the period.

2.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.

3.Annualized for periods less than one full year.

4.Includes the Fund's share of the allocated expenses and/or net investment income from the master funds.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Seven Months Ended February 29, 2020

1.83%

Year Ended July 31, 2019

1.74%

Year Ended July 31, 2018

1.74%

Year Ended July 31, 2017

1.77%

Year Ended July 31, 2016

1.78%

Year Ended July 31, 2015

1.79%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

8.The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

 

Purchase Transactions

Sale Transactions

Seven Months Ended February 29, 2020

$11,531,839

$13,476,801

Year Ended July 31, 2019

$129,169,490

$127,412,648

See accompanying Notes to Financial Statements.

36 INVESCO INTERMEDIATE BOND FACTOR FUND

Class R

Seven Months Ended

February 29, Year Ended Year Ended Year Ended Year Ended Year Ended 2020 July 31, 2019 July 31, 2018 July 31, 2017 July 31, 2016 July 31, 2015

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$10.88

$10.44

$10.93

$11.04

$10.66

$10.90

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income1

0.15

0.28

0.28

0.26

0.27

0.31

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.40

0.44

(0.49)

(0.09)

0.39

(0.24)

Total from investment

 

 

 

 

 

 

operations

0.55

0.72

(0.21)

0.17

0.66

0.07

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.16)

(0.28)

(0.28)

(0.28)

(0.28)

(0.31)

Net asset value, end of period

$11.27

$10.88

$10.44

$10.93

$11.04

$10.66

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value2

5.09%

7.06%

(1.91)%

1.58%

6.29%

0.59%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$20,366

$20,511

$19,416

$15,318

$11,736

$6,189

Average net assets (in

 

 

 

 

 

 

thousands)

$20,690

$19,919

$18,041

$13,530

$8,432

$5,572

Ratios to average net assets:3,4

 

 

 

 

 

 

Net investment income

2.40%

2.67%

2.65%

2.45%

2.55%

2.82%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

1.31%

1.22%

1.21%

1.25%

1.27%

1.27%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%5

Total expenses6

1.31%

1.22%

1.21%

1.25%

1.27%

1.27%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

1.13%

1.15%

1.19%

1.22%

1.25%

1.25%

Portfolio turnover rate7

64%8

108%8

57%

80%

73%

100%

37 INVESCO INTERMEDIATE BOND FACTOR FUND

FINANCIAL HIGHLIGHTS Continued

1.Calculated based on the average shares outstanding during the period.

2.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.

3.Annualized for periods less than one full year.

4.Includes the Fund's share of the allocated expenses and/or net investment income from the master funds.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Seven Months Ended February 29, 2020

1.33%

Year Ended July 31, 2019

1.24%

Year Ended July 31, 2018

1.23%

Year Ended July 31, 2017

1.27%

Year Ended July 31, 2016

1.28%

Year Ended July 31, 2015

1.28%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

8.The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

 

Purchase Transactions

Sale Transactions

Seven Months Ended February 29, 2020

$11,531,839

$13,476,801

Year Ended July 31, 2019

$129,169,490

$127,412,648

See accompanying Notes to Financial Statements.

38 INVESCO INTERMEDIATE BOND FACTOR FUND

Class Y

Seven Months Ended

February 29, Year Ended Year Ended Year Ended Year Ended Year Ended 2020 July 31, 2019 July 31, 2018 July 31, 2017 July 31, 2016 July 31, 2015

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$10.88

$10.43

$10.91

$11.03

$10.65

$10.89

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income1

0.20

0.35

0.33

0.32

0.32

0.36

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.40

0.45

(0.47)

(0.11)

0.39

(0.24)

Total from investment

 

 

 

 

 

 

operations

0.60

0.80

(0.14)

0.21

0.71

0.12

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.22)

(0.35)

(0.34)

(0.33)

(0.33)

(0.36)

Net asset value, end of period

$11.26

$10.88

$10.43

$10.91

$11.03

$10.65

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value2

5.55%

7.81%

(1.35)%

1.98%

6.82%

1.09%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$19,032

$20,940

$27,430

$17,748

$11,013

$5,413

Average net assets (in

 

 

 

 

 

 

thousands)

$20,480

$23,481

$23,728

$12,709

$6,857

$4,275

Ratios to average net assets:3,4

 

 

 

 

 

 

Net investment income

3.09%

3.37%

3.14%

2.95%

3.04%

3.35%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

0.81%

0.73%

0.72%

0.75%

0.77%

0.77%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%5

Total expenses6

0.81%

0.73%

0.72%

0.75%

0.77%

0.77%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

0.43%

0.45%

0.70%

0.72%

0.75%

0.75%

Portfolio turnover rate7

64%8

108%8

57%

80%

73%

100%

39 INVESCO INTERMEDIATE BOND FACTOR FUND

FINANCIAL HIGHLIGHTS Continued

1.Calculated based on the average shares outstanding during the period.

2.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.

3.Annualized for periods less than one full year.

4.Includes the Fund's share of the allocated expenses and/or net investment income from the master funds.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Seven Months Ended February 29, 2020

0.83%

Year Ended July 31, 2019

0.75%

Year Ended July 31, 2018

0.74%

Year Ended July 31, 2017

0.77%

Year Ended July 31, 2016

0.78%

Year Ended July 31, 2015

0.78%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

8.The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

 

Purchase Transactions

Sale Transactions

Seven Months Ended February 29, 2020

$11,531,839

$13,476,801

Year Ended July 31, 2019

$129,169,490

$127,412,648

See accompanying Notes to Financial Statements.

40 INVESCO INTERMEDIATE BOND FACTOR FUND

 

Seven Months

 

 

Ended

Period

Class R5

February 29,

Ended

2020 July 31, 20191

Per Share Operating Data

 

 

Net asset value, beginning of period

$10.87

$10.67

Income (loss) from investment operations:

 

 

Net investment income2

0.20

0.07

Net realized and unrealized gain

0.40

0.19

Total from investment operations

0.60

0.26

Dividends and/or distributions to shareholders:

 

 

Dividends from net investment income

(0.20)

(0.06)

Net asset value, end of period

$11.27

$10.87

 

 

 

 

 

 

Total Return, at Net Asset Value3

5.59%

2.44%

 

 

 

Ratios/Supplemental Data

 

 

Net assets, end of period (in thousands)

$11

$10

Average net assets (in thousands)

$10

$10

Ratios to average net assets:4,5

 

 

Net investment income

3.09%

3.39%

Expenses excluding specific

 

 

expenses listed below

0.60%

0.62%

Interest and fees from

 

 

borrowings

0.00%

0.00%

Total expenses6

0.60%

0.62%

Expenses after payments,

 

 

waivers and/or

 

 

reimbursements and reduction

 

 

to custodian expenses

0.44%

0.43%

Portfolio turnover rate7,8

64%

108%

1.For the period from after the close of business on May 24, 2019 (inception of offering) to July 31, 2019.

2.Calculated based on the average shares outstanding during the period.

3.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.

4.Annualized for periods less than one full year.

5.Includes the Fund's share of the allocated expenses and/or net investment income from the master funds.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Seven Months Ended February 29, 2020

0.62%

Period Ended July 31, 2019

0.64%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

8.The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

 

Purchase Transactions

Sale Transactions

Seven Months Ended February 29, 2020

$11,531,839

$13,476,801

Year Ended July 31, 2019

$129,169,490

$127,412,648

See accompanying Notes to Financial Statements.

41 INVESCO INTERMEDIATE BOND FACTOR FUND

FINANCIAL HIGHLIGHTS Continued

Class R6

Seven Months Ended

February 29, Year Ended Year Ended Year Ended Year Ended Year Ended 2020 July 31, 2019 July 31, 2018 July 31, 2017 July 31, 2016 July 31, 2015

Per Share Operating Data

 

 

 

 

 

 

Net asset value, beginning of

 

 

 

 

 

 

period

$10.88

$10.44

$10.92

$11.03

$10.65

$10.89

Income (loss) from investment

 

 

 

 

 

 

operations:

 

 

 

 

 

 

Net investment income1

0.20

0.36

0.35

0.35

0.35

0.38

Net realized and unrealized

 

 

 

 

 

 

gain (loss)

0.40

0.43

(0.48)

(0.11)

0.38

(0.24)

Total from investment

 

 

 

 

 

 

operations

0.60

0.79

(0.13)

0.24

0.73

0.14

Dividends and/or distributions

 

 

 

 

 

 

to shareholders:

 

 

 

 

 

 

Dividends from net investment

 

 

 

 

 

 

income

(0.21)

(0.35)

(0.35)

(0.35)

(0.35)

(0.38)

Net asset value, end of period

$11.27

$10.88

$10.44

$10.92

$11.03

$10.65

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Return, at Net Asset

 

 

 

 

 

 

Value2

5.60%

7.80%

(1.18)%

2.27%

7.03%

1.29%

 

 

 

 

 

 

 

Ratios/Supplemental Data

 

 

 

 

 

 

Net assets, end of period (in

 

 

 

 

 

 

thousands)

$5,795

$5,662

$7,783

$2,189

$80

$110

Average net assets (in

 

 

 

 

 

 

thousands)

$5,884

$7,053

$5,612

$563

$110

$105

Ratios to average net assets:3,4

 

 

 

 

 

 

Net investment income

3.14%

3.41%

3.30%

3.23%

3.28%

3.52%

Expenses excluding specific

 

 

 

 

 

 

expenses listed below

0.58%

0.56%

0.56%

0.56%

0.57%

0.56%

Interest and fees from

 

 

 

 

 

 

borrowings

0.00%

0.00%5

0.00%5

0.00%5

0.00%5

0.00%5

Total expenses6

0.58%

0.56%

0.56%

0.56%

0.57%

0.56%

Expenses after payments,

 

 

 

 

 

 

waivers and/or

 

 

 

 

 

 

reimbursements and reduction

 

 

 

 

 

 

to custodian expenses

0.39%

0.41%

0.54%

0.54%

0.55%

0.55%

Portfolio turnover rate7

64%8

108%8

57%

80%

73%

100%

42 INVESCO INTERMEDIATE BOND FACTOR FUND

1.Calculated based on the average shares outstanding during the period.

2.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.

3.Annualized for periods less than one full year.

4.Includes the Fund's share of the allocated expenses and/or net investment income from the master funds.

5.Less than 0.005%.

6.Total expenses including indirect expenses from fund fees and expenses were as follows:

Seven Months Ended February 29, 2020

0.60%

Year Ended July 31, 2019

0.58%

Year Ended July 31, 2018

0.58%

Year Ended July 31, 2017

0.58%

Year Ended July 31, 2016

0.58%

Year Ended July 31, 2015

0.57%

7.Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable.

8.The portfolio turnover rate excludes purchase and sale transactions of To Be Announced (TBA) mortgage-related securities as follows:

 

Purchase Transactions

Sale Transactions

Seven Months Ended February 29, 2020

$11,531,839

$13,476,801

Year Ended July 31, 2019

$129,169,490

$127,412,648

See accompanying Notes to Financial Statements.

43 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS February 29, 2020

Note 1 - Significant Accounting Policies

Invesco Intermediate Bond Factor Fund (the "Fund"), formerly Invesco Oppenheimer Intermediate Income Fund, is a series portfolio of AIM Investment Securities Funds (Invesco Investment Securities 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 such Fund or each class.

Prior to the close of business on May 24, 2019, the Fund operated as Oppenheimer Intermediate Income Fund (the "Acquired Fund" or "Predecessor Fund"). The Acquired Fund was reorganized after the close of business on May 24, 2019 (the "Reorganization Date") through the transfer of all of its assets and liabilities to the Fund (the "Reorganization").

Upon closing of the Reorganization, holders of the Acquired Fund's Class A, Class C, Class R, and Class Y shares received the corresponding class of shares of the Fund and holders of the Acquired Fund's Class I shares received Class R6 shares of the Fund. Information for the Acquired Fund's Class I shares prior to the Reorganization is included with Class R6 shares throughout this report. Class R5 shares commenced operations on the Reorganization Date.

Effective August 31, 2019, the Fund's fiscal year end changed from July 31 to the last day in February.

The Fund's investment objective is to seek total return.

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 and 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.

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.

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),

44 INVESCO INTERMEDIATE BOND FACTOR FUND

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.

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.

Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.

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

45 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

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 economic conditions, interest rates, investor perceptions 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 the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Paydown gains and losses on mortgage and asset-backed securities are recorded as adjustments to interest income. 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,

46 INVESCO INTERMEDIATE BOND FACTOR FUND

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 transactions 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.

D. Distributions - Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from accounting principles generally accepted in the United States of America ("GAAP"), are recorded on the ex-dividend date. Income distributions, if any, are declared and paid monthly. Capital gain distributions, if any, are declared and paid annually or at other times as determined necessary by the Adviser.

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

47 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

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 financial statements are prepared on a basis in conformity with GAAP, which 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. Dollar Rolls and Forward Commitment Transactions - The Fund may enter into dollar roll transactions to enhance the Fund's performance. The Fund executes its dollar roll transactions in the to be announced ("TBA") market whereby the Fund makes a forward commitment to purchase a security and, instead of accepting delivery, the position is offset by the sale of the security with a simultaneous agreement to repurchase at a future date.

The Fund accounts for dollar roll transactions as purchases and sales and realizes gains and losses on these transactions. The Fund will segregate liquid assets in an amount equal to its dollar roll commitments. Dollar roll transactions involve the risk that a Counterparty to the transaction may fail to complete the transaction. If this occurs, the Fund may lose the opportunity to purchase or sell the security at the agreed upon price. Dollar roll transactions also involve the risk that the value of the securities retained by the Fund may decline below the price of the securities that the Fund has sold but is obligated to purchase under the agreement. Dollar roll transactions covered in this manner are not treated as senior

48 INVESCO INTERMEDIATE BOND FACTOR FUND

securities for purposes of a Fund's fundamental investment limitation on senior securities and borrowings.

J. 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.

K. 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

49 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

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

50 INVESCO INTERMEDIATE BOND FACTOR FUND

recovery in 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.

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. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund's exposure is unlimited.

Note 2 - Advisory Fees and Other Fees Paid to Affiliates

51 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

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:

Fee Schedule Through February 28, 2020*

 

Fee Schedule Effective February 29, 2020*

Up to $500 million

0.40%

 

Up to $2 billion

0.25%

Next $500 million

0.35

 

Over $2 billion

0.23

Next $4 billion

0.33

 

 

 

Over $5 billion

0.31

 

 

 

*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 seven months ended February 29, 2020, the effective advisory fee rate incurred by the Fund was 0.38%.

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.

Effective on the Reorganization Date, 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 0.75%, 1.65%, 1.15%, 0.45%, 0.46% and 0.41%, respectively, of the Fund's average daily net assets. Effective February 28, 2020, the Fund's expense limitation agreement was amended to reflect a reduction to the Fund's existing expense limits. Under the amended expense limitation agreement, the Adviser has contractually agreed to waive advisory fees and/or reimburse expenses to the extent necessary to limit the Fund's Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 0.52%, 1.27%, 0.77%, 0.27%, 0.27% and 0.27%, respectively, of the Fund's average daily net assets (the "expense limits") through May 31, 2021. 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; (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

52 INVESCO INTERMEDIATE BOND FACTOR FUND

offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on May 31, 2021. 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, 2021, 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 seven months ended February 29, 2020, the Adviser waived advisory fees of $18,870 and reimbursed fund expenses of $211,474, $21,536, $19,417, $42,716, $9, and $5,931 for Class A, Class C, Class R, Class Y, Class R5 and Class R6, 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 seven months ended February 29, 2020, expenses incurred under the agreement are shown in the Statement of Operations as Administration fees. Additionally, Invesco has entered into service agreements whereby JPMorgan Chase Bank serves as custodian to the Fund. Prior to the Reorganization, the Acquired Fund paid administrative fees to OFI Global Asset Management, Inc.

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. Prior to the Reorganization, the Acquired Fund paid transfer agent fees to OFI Global Asset Management, Inc. and Shareholder Services, Inc. For the seven months ended February 29, 2020, expenses incurred under these agreements are shown in the Statement of Operations as Transfer and shareholder servicing 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 "Plan"). The Fund, pursuant to the Class A Plan, reimbursed IDI in an amount up to an 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 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 Plan 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 plans. Prior to

53 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

the Reorganization, the Acquired Fund paid distribution fees to OppenheimerFunds Distributor, Inc. For the seven months ended February 29, 2020, expenses incurred under the plans are shown in the Statement of Operations as Distribution and service plan 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 seven months ended February 29, 2020, IDI advised the Fund that IDI retained $14,289 in front-end sales commissions from the sale of Class A shares and $1,662 and $339 from Class A and Class C shares, respectively, for CDSC imposed on 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 February 29, 2020. 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.

54 INVESCO INTERMEDIATE BOND FACTOR FUND

 

 

 

 

 

 

Level 3—

 

 

 

Level 1—

 

Level 2—

 

Significant

 

 

 

Unadjusted

 

Other Significant

 

Unobservable

 

 

 

Quoted Prices

 

Observable Inputs

 

Inputs

Value

Assets Table

 

 

 

 

 

 

 

Investments, at Value:

 

 

 

 

 

 

 

Asset-Backed Securities

$

— $

911,851

$

— $

911,851

Mortgage-Backed Obligations

 

 

15,297,723

 

15,297,723

U.S. Government Obligations

 

 

41,806,961

 

41,806,961

Corporate Bonds and Notes

 

 

97,811,841

 

97,811,841

Preferred Stocks

 

3,852,429

 

 

3,852,429

Investment Companies

 

36,463,571

 

 

36,463,571

Total Investments, at Value

 

40,316,000

 

155,828,376

 

196,144,376

Other Financial Instruments:

 

 

 

 

 

 

 

Futures contracts

 

789,414

 

 

789,414

Total Assets

$

41,105,414

$

155,828,376

$

— $

196,933,790

Liabilities Table

 

 

 

 

 

 

 

Other Financial Instruments:

 

 

 

 

 

 

 

Futures contracts

$

(366,601)

$

— $

— $

(366,601)

Total Liabilities

$

(366,601)

$

— $

— $

(366,601)

Forward currency exchange contracts and futures contracts, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract's value from trade date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

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 Instruments at Period-End

The table below summarizes the value of the Fund's derivative investments, detailed by primary risk exposure, held as of February 29, 2020:

 

Asset Derivatives

 

 

 

Liability Derivatives

 

 

 

Statement of Assets

 

 

 

Statement of Assets

 

 

 

and Liabilities Location

 

Value

 

and Liabilities Location

 

Value

Interest rate contracts Futures contracts

$

789,4141

 

Futures contracts

$

366,601 1

55 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

 

Asset Derivatives

 

 

Liability Derivatives

 

Derivative Assets/

 

 

 

 

 

Liabilities not subject

 

 

 

 

 

to master netting

 

 

 

 

 

agreements

$

(789,414)

$

(366,601)

Total Derivative

 

 

 

 

 

Assets/Liabilities not

 

 

 

 

 

subject to master

 

 

 

 

 

netting agreements

$

$

1.The daily variation margin receivable (payable) at period end is recorded in the Statement of Assets and Liabilities.

Effect of Derivative Investments for the Seven Months Ended February 29, 2020

The tables below summarize the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:

Amount of Realized Gain or (Loss) Recognized on Derivatives

Derivatives

 

 

 

 

 

 

 

Not Accounted

 

 

 

 

 

 

 

for as Hedging

 

Futures

 

 

 

 

 

Instruments

 

contracts Swap contracts

 

Total

Credit contracts

$

$

(803,274)

$

(803,274)

 

Interest rate contracts

 

2,570,477

 

 

2,570,477

 

Total

$

2,570,477

$

(803,274)

$

1,767,203

 

 

 

 

 

Amount of Change in Unrealized Gain or (Loss) Recognized on Derivatives

 

 

Derivatives

 

 

 

 

 

 

 

Not Accounted

 

 

 

 

 

 

 

for as Hedging

 

Futures

 

 

 

 

 

Instruments

 

contracts Swap contracts

 

Total

Credit contracts

$

$

632,630

$

632,630

 

Interest rate contracts

 

(367,064)

 

 

(367,064)

 

Total

$

(367,064)

$

632,630

$

265,566

 

 

 

 

 

 

 

 

 

The table below summarizes the seven month ended average notional value of futures contracts and one month ended average notional value of swap agreements during the period.

 

 

Futures

 

Swap

 

 

contracts

 

Arrangements

 

 

 

 

 

Average notional

 

 

 

7,847,680

amount

$

92,863,192

$

Note 5 - Trustee and Officer Fees and Benefits

Certain Trustees have executed Deferred Compensation Agreement(s) pursuant to which they have the option to elect to defer receipt of all or a portion of the annual compensation they

56 INVESCO INTERMEDIATE BOND FACTOR FUND

are entitled to receive from the Fund. For purposes of determining the amount owed to the Trustees under the plan(s), deferred amounts are treated as though equal dollar amounts had been invested in shares of the Fund or in other Invesco and/or Invesco Oppenheimer funds selected by the Trustees. The Fund purchases shares of the funds selected for deferral by the Trustees in amounts equal to his or her deemed investment, resulting in a Fund asset equal to the deferred compensation liability. Such assets are included as a component of "Other" within the asset section of the Statement of Assets and Liabilities. Deferral of Trustees' fees under the plan(s) will not affect the net assets of the Fund and will not materially affect the Fund's assets, liabilities or net investment income per share. Amounts will be deferred until distributed in accordance with the Deferred Compensation Agreement(s).

Note 6 - Cash Balances

The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with JPMorgan Chase Bank, 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.

Note 7 - Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders for the Seven Months Ended February 29, 2020 and the Fiscal Years Ended July 31, 2019 and July 31, 2018:

 

 

2020

 

2019

 

2018

Ordinary income

$

3,190,421

$

5,631,195

$

5,889,823

Tax Components of Net Assets at Period-End:

 

 

2020

Undistributed ordinary income

$

533,176

Net unrealized appreciation - investments

 

8,875,821

Temporary book/tax differences

 

(25,371)

Capital loss carryforward

 

(1,310,512)

Shares of beneficial interest

 

182,615,502

Total net assets

$

190,688,616

The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to futures contracts.

The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the

57 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

result of the trustee deferral of compensation and retirement plan benefits.

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. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. 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 has a capital loss carryforward as of February 29, 2020, which expires as follows:

Capital Loss Carryforward*

Expiration

Short-Term

 

Long-Term

 

Total

Not subject to expiration $

1,302,983

$

7,529

$

1,310,512

*Capital loss carryforward as of the date listed above 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. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the seven months ended February 29, 2020 was $43,674,834 and $87,462,621, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $67,942,650 and $36,957,982, 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

$

9,545,302

Aggregate unrealized (depreciation) of investments

 

(669,481)

Net unrealized appreciation of investments

$

8,875,821

Cost of investments for tax purposes is $212,649,290.

Note 9 - Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of partnership transactions, on February 29, 2020, undistributed net investment income was increased by $446,604, undistributed net realized loss was increased by $337,530 and shares of beneficial interest was decreased by $109,074. This reclassification had no effect on the net assets of the Fund.

58 INVESCO INTERMEDIATE BOND FACTOR FUND

Note 10 - Share Information

Transactions in shares of beneficial interest were as follows:

 

Seven Months Ended

Year Ended July 31, 20192

Year Ended July 31, 2018

 

February 29, 20201

 

 

 

 

 

 

 

 

Shares

 

Amount

Shares

 

Amount

Shares

 

Amount

Class A

 

 

 

 

 

 

 

 

 

Sold

1,037,571

$

11,455,611

2,475,679

$

25,977,722

3,081,751

$

33,249,682

Automatic

 

 

 

 

 

 

 

 

 

Conversion

 

 

 

 

 

 

 

 

 

Class C

 

 

 

 

 

 

 

 

 

to Class A

 

 

 

 

 

 

 

 

 

Shares

29,570

 

327,243

 

 

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

188,737

 

2,087,920

327,284

 

3,426,438

347,885

 

3,718,015

Redeemed

(1,357,418)

 

(14,980,693)

(3,256,200)

 

(33,996,208)

(3,916,504)

 

(41,779,794)

Net increase

(101,540)

$

(1,109,919)

(453,237)

$

(4,592,048)

(486,868)

$

(4,812,097)

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class C

 

 

 

 

 

 

 

 

 

Sold

277,867

$

3,072,852

445,362

$

4,635,606

761,628

$

8,205,750

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

23,926

 

264,633

58,108

 

606,705

65,858

 

703,140

Automatic

 

 

 

 

 

 

 

 

 

Conversion

 

 

 

 

 

 

 

 

 

Class C

 

 

 

 

 

 

 

 

 

to Class A

 

 

 

 

 

 

 

 

 

Shares

(29,586)

 

(327,243)

 

 

Redeemed

(380,085)

 

(4,190,404)

(1,339,404)

 

(14,139,457)

(893,084)

 

(9,546,214)

Net increase

(107,878)

$

(1,180,162)

(835,934)

$

(8,897,146)

(65,598)

$

(637,324)

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class R

 

 

 

 

 

 

 

 

 

Sold

257,804

$

2,845,463

486,574

$

5,075,703

805,312

$

8,642,719

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

26,491

 

289,089

50,674

 

530,456

44,376

 

473,617

Redeemed

(362,485)

 

(4,001,074)

(512,103)

 

(5,354,442)

(391,867)

 

(4,171,516)

Net increase

(78,190)

$

(866,522)

25,145

$

251,717

457,821

$

4,944,820

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class Y

 

 

 

 

 

 

 

 

 

Sold

683,759

$

7,590,469

2,309,644

$

23,802,066

2,173,981

$

23,259,291

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

36,654

 

405,459

74,462

 

777,216

70,154

 

746,080

Redeemed

(954,407)

 

(10,531,820)

(3,090,351)

 

(31,847,220)

(1,240,110)

 

(13,182,903)

59 INVESCO INTERMEDIATE BOND FACTOR FUND

NOTES TO FINANCIAL STATEMENTS Continued

 

Seven Months Ended

Year Ended July 31, 20192

Year Ended July 31, 2018

 

February 29, 20201

 

 

 

 

 

 

 

 

Shares

 

Amount

Shares

 

Amount

Shares

 

Amount

Net increase

(233,994)

$

(2,535,892)

(706,245)

$

(7,267,938)

1,004,025

$

10,822,468

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class R53

 

 

 

 

 

 

 

 

 

Sold

$

937

$

10,000

$

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

 

 

 

Redeemed

 

 

 

Net increase

$

937

$

10,000

$

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Class R6

 

 

 

 

 

 

 

 

 

Sold

126,736

$

1,393,303

238,957

$

2,496,305

682,796

$

7,331,314

Dividends

 

 

 

 

 

 

 

 

 

and/or

 

 

 

 

 

 

 

 

 

distributions

 

 

 

 

 

 

 

 

 

reinvested

9,987

 

110,563

22,775

 

238,146

17,497

 

185,853

Redeemed

(142,659)

 

(1,571,785)

(487,266)

 

(5,127,923)

(154,954)

 

(1,644,164)

Net increase

(5,936)

$

(67,919)

(225,534)

$

(2,393,472)

545,339

$

5,873,003

(decrease)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.There are entities that are record owners of more than 5% of the outstanding shares of the Fund and own 13% 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.

2.There are entities that are record owners of more than 5% of the outstanding shares of the Fund and own 12% 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.

3.Commencement date after the close of business on May 24, 2019.

Note 11 - Borrowings

Joint Credit Facility. A number of mutual funds managed by the Adviser participated in a $1.95 billion revolving credit facility (the "Facility") intended to provide short-term financing, if necessary, subject to certain restrictions in connection with atypical redemption activity. Expenses and fees related to the Facility are paid by the participating funds and are disclosed separately or as other expenses on the Statement of Operations. The Fund did not utilize the Facility during the reporting period. The Facility terminated May 24, 2019.

Note 12 - Subsequent Event

60 INVESCO INTERMEDIATE BOND FACTOR FUND

During the first quarter of 2020, the World Health Organization declared the coronavirus (COVID-19) to be a public health emergency. COVID-19 has led to increased short-term market volatility and may have adverse long-term effects on U.S. and world economies and markets in general. COVID-19 may adversely impact the Fund's ability to achieve its investment objective. Because of the uncertainties on valuation, the global economy and business operations, values reflected in these financial statements may materially differ from the value received upon actual sales of those investments.

The Coronavirus Aid, Relief, and Economic Security Act, commonly referred to as the "CARES Act," was signed into law on March 27, 2020 by President Trump. The Act is a $2 trillion stimulus package to help individuals, businesses and hospitals in response to the economic distress caused by the COVID-19 crisis. The Adviser is assessing the components of the Act and the impacts to the Fund should be immaterial.

61 INVESCO INTERMEDIATE BOND FACTOR FUND

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Trustees of AIM Investment Securities Funds (Invesco Investment Securities Funds) and Shareholders of Invesco Intermediate Bond Factor Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Intermediate Bond Factor Fund, formerly Invesco Oppenheimer Intermediate Income Fund, (one of the funds constituting AIM Investment Securities Funds (Invesco Investment Securities Funds), referred to hereafter as the "Fund") as of February 29, 2020, the related statements of operations and of changes in net assets, including the related notes, and the financial highlights for each of the periods indicated in the table below (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 29, 2020, the results of its operations, the changes in its net assets and the financial highlights for each of the periods indicated in the table below, in conformity with accounting principles generally accepted in the United States of America.

Statement of Operations and Statement of

 

Changes in Net Assets

Financial Highlights

 

 

For the period from August 1, 2019 through

For the period from August 1, 2019 through

February 29, 2020 and the year ended July 31,

February 29, 2020 and the year ended July 31,

2019

2019 for Class A, Class C, Class R, Class Y and

 

Class R6

 

For the period from August 1, 2019 through

 

February 29, 2020 and the period from May 24,

 

2019 (inception of offering) through July 31,

 

2019 for Class R5

 

 

The financial statements of Invesco Intermediate Bond Factor Fund (formerly Oppenheimer Intermediate Income Fund) as of and for the year ended July 31, 2018 and the financial highlights for each of the periods ended on or prior to July 31, 2018 (not presented herein, other than the statement of changes in net assets and the financial highlights) were audited by other auditors whose report dated September 26, 2018 expressed an unqualified opinion on those financial statements and financial highlights.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

62 INVESCO INTERMEDIATE BOND FACTOR FUND

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 29, 2020 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP Houston, Texas

April 28, 2020

We have served as the auditor of one or more investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

63 INVESCO INTERMEDIATE BOND FACTOR FUND

TAX INFORMATION

Form 1099-DIV, Form 1042-S and other year–end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its seven month ended February 29, 2020:

Federal and State Income Tax

 

Qualified Dividend Income*

7.11 %

Corporate Dividends Received Deduction*

1.84 %

Qualified Business Income

0.00 %

U.S. Treasury Obligations*

6.21 %

Tax-Exempt Interest Dividends*

0.00 %

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund's fiscal year.

64 INVESCO INTERMEDIATE BOND FACTOR FUND

PORTFOLIO PROXY VOTING POLICIES AND GUIDELINES; UPDATES TO SCHEDULE OF INVESTMENTS

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 holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund's semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists 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 Forms N-PORT on the SEC website at sec.gov.

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/proxyguidelines. 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. The 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.

65 INVESCO INTERMEDIATE BOND FACTOR FUND

TRUSTEES AND OFFICERS

The address of each trustee and officer is AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Trust"), 11 Greenway Plaza, Suite 1000, Houston, Texas 77046-1173. The trustees serve for the life of the Trust, subject to their earlier death, incapacitation, resignation, retirement or removal as more specifically provided in the Trust's organizational documents. Each officer serves for a one year term or until their successors are elected and qualified. Column two below includes length of time served with predecessor entities, if any.

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

INTERESTED TRUSTEE

 

 

 

 

 

 

 

 

 

Martin L. Flanagan 1 — 1960

2007

Executive Director, Chief Executive Officer and

229

None

Trustee and Vice Chair

 

President, Invesco Ltd. (ultimate parent of

 

 

 

 

Invesco and a global investment management

 

 

 

 

firm); Trustee and Vice Chair, The Invesco

 

 

 

 

Funds; Vice Chair, Investment Company

 

 

 

 

Institute; and Member of Executive Board,

 

 

 

 

SMU Cox School of Business

 

 

Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer, Invesco Advisers, Inc. (registered investment adviser); Director, Chairman, Chief Executive Officer and President, Invesco Holding Company (US), Inc. (formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service provider) and Invesco North American Holdings, Inc. (holding company); Director, Chief Executive Officer and President, Invesco Holding Company Limited (parent of Invesco and a global investment management firm); Director, Invesco Ltd.; Chairman, Investment Company Institute and President, Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief Financial Officer, Franklin Resources, Inc. (global investment management organization)

1 Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser.

66 INVESCO INTERMEDIATE BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

INDEPENDENT TRUSTEES

Bruce L. Crockett – 1944

2003 Chairman, Crockett Technologies Associates

Trustee and Chair

(technology consulting company)

 

Formerly: Director, Captaris (unified

 

messaging provider); Director, President and

 

Chief Executive Officer, COMSAT Corporation;

 

Chairman, Board of Governors of INTELSAT

 

(international communications company); ACE

 

Limited (insurance company); Independent

 

Directors Council and Investment Company

 

Institute: Member of the Audit Committee,

 

Investment Company Institute; Member of

 

the Executive Committee and Chair of the

 

Governance Committee, Independent Directors

 

Council

229Director and

Chairman of the

Audit Committee,

ALPS (Attorneys

Liability Protection Society) (insurance company); Director and Member of the Audit Committee and Compensation

Committee, Ferroglobe

PLC (metallurgical

company)

David C. Arch – 1945

2010 Chairman of Blistex Inc. (consumer health

229

Board member of the

Trustee

care products manufacturer); Member, World

 

Illinois Manufacturers'

 

Presidents' Organization

 

Association

 

 

 

 

Beth Ann Brown – 1968

2019 Independent Consultant

229

Director, Board of

Trustee

Formerly: Head of Intermediary Distribution,

 

Directors of Caron

 

 

Engineering Inc.;

 

Managing Director, Strategic Relations,

 

Advisor, Board of

 

Managing Director, Head of National

 

Advisors of Caron

 

Accounts, Senior Vice President, National

 

Engineering Inc.;

 

Account Manager and Senior Vice President,

 

President and

 

Key Account Manager, Columbia Management

 

Director, of Acton

 

Investment Advisers LLC; Vice President, Key

 

Shapleigh Youth

 

Account Manager, Liberty Funds Distributor,

 

Conservation Corps

 

Inc.; and Trustee of certain Oppenheimer

 

(non -profit); and

 

Funds

 

President and Director

 

 

 

of Grahamtastic

 

 

 

Connection (non-

 

 

 

profit)

Jack M. Fields – 1952

2003 Chief Executive Officer, Twenty First Century

Trustee

Group, Inc. (government affairs company);

 

and Chairman, Discovery Learning Alliance

 

(non-profit)

 

Formerly: Owner and Chief Executive Officer,

 

Dos Angeles Ranch L.P. (cattle, hunting,

 

corporate entertainment); Director, Insperity,

 

Inc. (formerly known as Administaff) (human

 

resources provider); Chief Executive Officer,

 

Texana Timber LP (sustainable forestry

 

company); Director of Cross Timbers Quail

 

Research Ranch (non-profit); and member of

 

the U.S. House of Representatives

229Member, Board of Directors of Baylor

College of Medicine

67 INVESCO INTERMEDIATE BOND FACTOR FUND

TRUSTEES AND OFFICERS Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

INDEPENDENT TRUSTEES (CONTINUED)

Cynthia Hostetler —1962

2017 Non-Executive Director and Trustee of a

Trustee

number of public and private business

 

corporations

 

Formerly: Director, Aberdeen Investment

 

Funds (4 portfolios); Head of Investment

 

Funds and Private Equity, Overseas Private

 

Investment Corporation; President, First

 

Manhattan Bancorporation, Inc.; Attorney,

 

Simpson Thacher & Bartlett LLP

229Vulcan Materials

Company

(construction materials

company); Trilinc Global Impact Fund; Genesee & Wyoming, Inc. (railroads); Artio Global Investment LLC (mutual

fund complex);

Edgen Group, Inc. (specialized energy and infrastructure products distributor); Investment Company Institute (professional organization); Independent Directors Council (professional organization)

Eli Jones – 1961

2016 Professor and Dean, Mays Business School -

229

Insperity, Inc. (formerly

Trustee

Texas A&M University

 

known as Administaff)

 

Formerly: Professor and Dean, Walton College

 

(human resources

 

 

provider)

 

of Business, University of Arkansas and E.J.

 

 

 

Ourso College of Business, Louisiana State

 

 

 

University; Director, Arvest Bank

 

 

Elizabeth Krentzman – 1959

2019 Formerly: Principal and Chief Regulatory

Trustee

Advisor for Asset Management Services and

 

U.S. Mutual Fund Leader of Deloitte & Touche

 

LLP; General Counsel of the Investment

 

Company Institute (trade association);

 

National Director of the Investment

 

Management Regulatory Consulting Practice,

 

Principal, Director and Senior Manager of

 

Deloitte & Touche LLP; Assistant Director of

 

the Division of Investment Management -

 

Office of Disclosure and Investment Adviser

 

Regulation of the U.S. Securities and Exchange

 

Commission and various positions with the

 

Division of Investment Management – Office

 

of Regulatory Policy of the U.S. Securities and

 

Exchange Commission; Associate at Ropes &

 

Gray LLP.; and Trustee of certain Oppenheimer

 

Funds

229Trustee of the

University of Florida

National Board

Foundation; Member of the Cartica Funds Board of Directors (private investment funds); Member of the University of Florida Law Center

Association, Inc. Board

of Trustees and Audit

Committee Member

68 INVESCO INTERMEDIATE BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

INDEPENDENT TRUSTEES (CONTINUED)

Anthony J. LaCava, Jr. – 1956 2019

Formerly: Director and Member of the Audit

Trustee

Committee, Blue Hills Bank (publicly traded

 

financial institution) and Managing Partner,

 

KPMG LLP

229Blue Hills Bank;

Chairman of Bentley University; Member, Business School Advisory Council; and Nominating

Committee, KPMG LLP

Prema Mathai-Davis – 1950 2003 Retired229None Trustee

Formerly; Co-Founder & Partner of Quantalytics Research, LLC, (a FinTech Investment Research Platform for the Self- Directed Investor)

Joel W. Motley – 1952

2019 Director of Office of Finance, Federal Home

Trustee

Loan Bank System; Member of the Vestry

 

of Trinity Wall Street; Managing Director of

 

Carmona Motley Hoffman, Inc. (privately held

 

financial advisor); Member of the Council

 

on Foreign Relations and its Finance and

 

Budget Committee; Chairman Emeritus of

 

Board of Human Rights Watch and Member

 

of its Investment Committee; and Member

 

of Investment Committee and Board of

 

Historic Hudson Valley (non-profit cultural

 

organization).

 

Formerly: Managing Director of Public Capital

 

Advisors, LLC (privately held financial advisor);

 

Managing Director of Carmona Motley

 

Hoffman, Inc. (privately held financial advisor);

 

Trustee of certain Oppenheimer Funds; and

 

Director of Columbia Equity Financial Corp.

 

(privately held financial advisor)

229Member of Board of Greenwall Foundation (bioethics research foundation) and

its Investment

Committee; Member of Board of Friends of the LRC (non-profit legal advocacy); Board Member and Investment Committee Member of Pulitzer Center for Crisis

Reporting (non-profit

journalism)

Teresa M. Ressel — 1962

2017 Non-executive director and trustee of a

Trustee

number of public and private business

 

corporations

 

Formerly: Chief Financial Officer, Olayan

 

America, The Olayan Group (international

 

investor/commercial/industrial); Chief

 

Executive Officer, UBS Securities LLC; Group

 

Chief Operating Officer, Americas, UBS AG;

 

Assistant Secretary for Management & Budget

 

and CFO, US Department of the Treasury

229Atlantic Power

Corporation (power

generation company); ON Semiconductor Corp. (semiconductor supplier)

69 INVESCO INTERMEDIATE BOND FACTOR FUND

TRUSTEES AND OFFICERS Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

INDEPENDENT TRUSTEES

 

 

 

 

(CONTINUED)

 

 

 

 

 

 

 

 

 

Ann Barnett Stern – 1957

2017

President and Chief Executive Officer, Houston

229

Federal Reserve Bank

Trustee

 

Endowment Inc. (private philanthropic

 

of Dallas

 

 

institution)

 

 

 

 

Formerly: Executive Vice President and

 

 

 

 

General Counsel, Texas Children's Hospital;

 

 

 

 

Attorney, Beck, Redden and Secrest, LLP;

 

 

 

 

Business Law Instructor, University of St.

 

 

 

 

Thomas; Attorney, Andrews & Kurth LLP

 

 

 

 

 

 

 

Robert C. Troccoli – 1949

2016

Retired

229

None

Trustee

 

Formerly: Adjunct Professor, University of

 

 

 

 

 

 

 

 

Denver – Daniels College of Business, Senior

 

 

 

 

Partner, KPMG LLP

 

 

Daniel S. Vandivort –1954

2019 Treasurer, Chairman of the Audit and Finance

Trustee

Committee, and Trustee, Board of Trustees,

 

Huntington Disease Foundation of America;

 

and President, Flyway Advisory Services LLC

 

(consulting and property management).

 

Formerly: Trustee and Governance Chair, of

 

certain Oppenheimer Funds

229Chairman and Lead Independent Director, Chairman of the Audit Committee, and Director, Board of Directors, Value Line Funds

James D. Vaughn – 1945

2019 Retired

Trustee

Formerly: Managing Partner, Deloitte & Touche

 

 

LLP; Trustee and Chairman of the Audit

 

Committee, Schroder Funds; Board Member,

 

Mile High United Way, Boys and Girls Clubs,

 

Boy Scouts, Colorado Business Committee

 

for the Arts, Economic Club of Colorado

 

and Metro Denver Network (economic

 

development corporation); and Trustee of

 

certain Oppenheimer Funds

229Board member

and Chairman of Audit Committee

of AMG National Trust Bank; Trustee and Investment Committee member, University of South Dakota Foundation; Board member, Audit Committee Member and past Board Chair, Junior Achievement (non-profit)

Christopher L. Wilson –

2017 Retired

1957

Formerly: Director, TD Asset Management USA

Trustee, Vice Chair and Chair

Designate

Inc. (mutual fund complex) (22 portfolios);

 

Managing Partner, CT2, LLC (investing and

 

consulting firm); President/Chief Executive

 

Officer, Columbia Funds, Bank of America

 

Corporation; President/Chief Executive Officer,

 

CDC IXIS Asset Management Services, Inc.;

229ISO New England,

Inc. (non-profit

organization

managing regional electricity market)

70 INVESCO INTERMEDIATE BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

 

 

 

 

Since

 

 

 

 

 

 

 

 

INDEPENDENT TRUSTEES

 

 

 

 

(CONTINUED)

 

 

 

 

 

 

 

 

 

Christopher L. Wilson

 

Principal & Director of Operations, Scudder

 

 

Continued

 

Funds, Scudder, Stevens & Clark, Inc.; Assistant

 

 

 

 

Vice President, Fidelity Investments

 

 

 

 

 

 

 

71 INVESCO INTERMEDIATE BOND FACTOR FUND

TRUSTEES AND OFFICERS Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS

 

 

 

 

 

 

 

 

 

Sheri Morris — 1964

2003

Head of Global Fund Services, Invesco Ltd.;

N/A

N/A

President, Principal Executive

 

President, Principal Executive Officer and

 

 

Officer and Treasurer

 

Treasurer, The Invesco Funds; Vice President,

 

 

 

 

Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); and Vice President,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust,

 

 

 

 

Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-

 

 

 

 

Traded Self-Indexed Fund Trust, and Vice

 

 

 

 

President, OppenheimerFunds, Inc.

 

 

 

 

Formerly: Vice President and Principal

 

 

 

 

Financial Officer, The Invesco Funds; Vice

 

 

 

 

President, Invesco AIM Advisers, Inc., Invesco

 

 

 

 

AIM Capital Management, Inc. and Invesco

 

 

 

 

AIM Private Asset Management, Inc.; Assistant

 

 

 

 

Vice President and Assistant Treasurer, The

 

 

 

 

Invesco Funds and Assistant Vice President,

 

 

 

 

Invesco Advisers, Inc., Invesco AIM Capital

 

 

 

 

Management, Inc. and Invesco AIM Private

 

 

 

 

Asset Management, Inc.; and Treasurer,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust and Invesco

 

 

 

 

Actively Managed Exchange-Traded Fund Trust

 

 

 

 

 

 

 

Russell C. Burk — 1958

2005

Senior Vice President and Senior Officer, The

N/A

N/A

Senior Vice President and

 

Invesco Funds

 

 

Senior Officer

 

 

 

 

 

 

 

 

 

Jeffrey H. Kupor – 1968

2018

Head of Legal of the Americas, Invesco

N/A

N/A

Senior Vice President, Chief

 

Ltd.; Senior Vice President and Secretary,

 

 

Legal Officer and Secretary

 

Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Senior Vice President

 

 

 

 

and Secretary, Invesco Distributors, Inc.

 

 

 

 

(formerly known as Invesco AIM Distributors,

 

 

 

 

Inc.); Vice President and Secretary, Invesco

 

 

 

 

Investment Services, Inc. (formerly known

 

 

 

 

as Invesco AIM Investment Services, Inc.)

 

 

 

 

Senior Vice President, Chief Legal Officer and

 

 

 

 

Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers

 

 

 

 

LLC (formerly known as Van Kampen Asset

 

 

 

 

Management); Secretary and General Counsel,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.) and Chief Legal

 

 

 

 

 

 

 

72 INVESCO INTERMEDIATE BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

Jeffrey H. Kupor (Continued)

 

Officer, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco

 

 

 

 

India Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-

 

 

 

 

Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Secretary, W.L.

 

 

 

 

Ross & Co., LLC

 

 

 

 

Formerly: Secretary and Vice President,

 

 

 

 

Jemstep, Inc.; Head of Legal, Worldwide

 

 

 

 

Institutional, Invesco Ltd.; Secretary and

 

 

 

 

General Counsel, INVESCO Private Capital

 

 

 

 

Investments, Inc.; Senior Vice President,

 

 

 

 

Secretary and General Counsel, Invesco

 

 

 

 

Management Group, Inc. (formerly known

 

 

 

 

as Invesco AIM Management Group,

 

 

 

 

Inc.); Assistant Secretary, INVESCO Asset

 

 

 

 

Management (Bermuda) Ltd.; Secretary and

 

 

 

 

General Counsel, Invesco Private Capital, Inc.;

 

 

 

 

Assistant Secretary and General Counsel,

 

 

 

 

INVESCO Realty, Inc.; Secretary and General

 

 

 

 

Counsel, Invesco Senior Secured Management,

 

 

 

 

Inc.; and Secretary, Sovereign G./P. Holdings

 

 

 

 

Inc.

 

 

 

 

 

 

 

Andrew R. Schlossberg –

2019

Head of the Americas and Senior Managing

N/A

N/A

1974

 

Director, Invesco Ltd.; Director and Senior

 

 

Senior Vice President

 

Vice President, Invesco Advisers, Inc. (formerly

 

 

 

 

known as Invesco Institutional (N.A.), Inc.)

 

 

 

 

(registered investment adviser); Director and

 

 

 

 

Chairman, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.) (registered transfer agent);

 

 

 

 

Senior Vice President, The Invesco Funds;

 

 

 

 

Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset

 

 

 

 

Management); Director, President and

 

 

 

 

Chairman, Invesco Insurance Agency, Inc.

 

 

 

 

Formerly: Director, Invesco UK Limited;

 

 

 

 

Director and Chief Executive, Invesco Asset

 

 

 

 

Management Limited and Invesco Fund

 

 

 

 

Managers Limited; Assistant Vice President,

 

 

 

 

The Invesco Funds; Senior Vice President,

 

 

 

 

Invesco Advisers, Inc. (formerly known as

 

 

 

 

Invesco Institutional (N.A.), Inc.) (registered

 

 

 

 

investment adviser); Director and Chief

 

 

 

 

Executive, Invesco Administration Services

 

 

 

 

 

 

 

73 INVESCO INTERMEDIATE BOND FACTOR FUND

TRUSTEES AND OFFICERS Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

Andrew R. Schlossberg

 

Limited and Invesco Global Investment

 

 

(Continued)

 

Funds Limited; Director, Invesco Distributors,

 

 

 

 

Inc.; Head of EMEA, Invesco Ltd.; President,

 

 

 

 

Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II and Invesco

 

 

 

 

India Exchange-Traded Fund Trust; Managing

 

 

 

 

Director and Principal Executive Officer,

 

 

 

 

Invesco Capital Management LLC

 

 

 

 

 

 

 

John M. Zerr — 1962

2006

Chief Operating Officer of the Americas;

N/A

N/A

Senior Vice President

 

Senior Vice President, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional

 

 

 

 

(N.A.), Inc.) (registered investment adviser);

 

 

 

 

Senior Vice President, Invesco Distributors, Inc.

 

 

 

 

(formerly known as Invesco AIM Distributors,

 

 

 

 

Inc.); Director and Vice President, Invesco

 

 

 

 

Investment Services, Inc. (formerly known as

 

 

 

 

Invesco AIM Investment Services, Inc.) Senior

 

 

 

 

Vice President, The Invesco Funds; Managing

 

 

 

 

Director, Invesco Capital Management LLC;

 

 

 

 

Director, Invesco Investment Advisers LLC

 

 

 

 

(formerly known as Van Kampen Asset

 

 

 

 

Management); Senior Vice President, Invesco

 

 

 

 

Capital Markets, Inc. (formerly known as

 

 

 

 

Van Kampen Funds Inc.); Manager, Invesco

 

 

 

 

Indexing LLC; Manager, Invesco Specialized

 

 

 

 

Products, LLC; Director and Senior Vice

 

 

 

 

President, Invesco Insurance Agency, Inc.;

 

 

 

 

Member, Invesco Canada Funds Advisory

 

 

 

 

Board; Director, President and Chief Executive

 

 

 

 

Officer, Invesco Corporate Class Inc. (corporate

 

 

 

 

mutual fund company); and Director,

 

 

 

 

Chairman, President and Chief Executive

 

 

 

 

Officer, Invesco Canada Ltd. (formerly known

 

 

 

 

as Invesco Trimark Ltd./Invesco Trimark Ltèe)

 

 

 

 

(registered investment adviser and registered

 

 

 

 

transfer agent)

 

 

 

 

Formerly: Director and Senior Vice President,

 

 

 

 

Invesco Management Group, Inc. (formerly

 

 

 

 

known as Invesco AIM Management Group,

 

 

 

 

Inc.); Secretary and General Counsel, Invesco

 

 

 

 

Management Group, Inc. (formerly known

 

 

 

 

as Invesco AIM Management Group, Inc.);

 

 

 

 

Secretary, Invesco Investment Services, Inc.

 

 

 

 

(formerly known as Invesco AIM Investment

 

 

 

 

Services, Inc.); Chief Legal Officer and

 

 

 

 

 

 

 

74 INVESCO INTERMEDIATE BOND FACTOR FUND

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

John M. Zerr (Continued)

 

Secretary, The Invesco Funds; Secretary and

 

 

 

 

General Counsel, Invesco Investment Advisers

 

 

 

 

LLC (formerly known as Van Kampen Asset

 

 

 

 

Management); Secretary and General Counsel,

 

 

 

 

Invesco Capital Markets, Inc. (formerly known

 

 

 

 

as Van Kampen Funds Inc.); Chief Legal

 

 

 

 

Officer, Invesco Exchange-Traded Fund Trust,

 

 

 

 

Invesco Exchange-Traded Fund Trust II, Invesco

 

 

 

 

India Exchange-Traded Fund Trust, Invesco

 

 

 

 

Actively Managed Exchange-Traded Fund

 

 

 

 

Trust, Invesco Actively Managed Exchange-

 

 

 

 

Traded Commodity Fund Trust and Invesco

 

 

 

 

Exchange-Traded Self-Indexed Fund Trust;

 

 

 

 

Secretary, Invesco Indexing LLC; Director,

 

 

 

 

Secretary, General Counsel and Senior Vice

 

 

 

 

President, Van Kampen Exchange Corp.;

 

 

 

 

Director, Vice President and Secretary, IVZ

 

 

 

 

Distributors, Inc. (formerly known as INVESCO

 

 

 

 

Distributors, Inc.); Director and Vice President,

 

 

 

 

INVESCO Funds Group, Inc.; Director and Vice

 

 

 

 

President, Van Kampen Advisors Inc.; Director,

 

 

 

 

Vice President, Secretary and General Counsel,

 

 

 

 

Van Kampen Investor Services Inc.; Director

 

 

 

 

and Secretary, Invesco Distributors, Inc.

 

 

 

 

(formerly known as Invesco AIM Distributors,

 

 

 

 

Inc.); Director, Senior Vice President, General

 

 

 

 

Counsel and Secretary, Invesco AIM Advisers,

 

 

 

 

Inc. and Van Kampen Investments Inc.;

 

 

 

 

Director, Vice President and Secretary, Fund

 

 

 

 

Management Company; Director, Senior Vice

 

 

 

 

President, Secretary, General Counsel and Vice

 

 

 

 

President, Invesco AIM Capital Management,

 

 

 

 

Inc.; Chief Operating Officer and General

 

 

 

 

Counsel, Liberty Ridge Capital, Inc. (an

 

 

 

 

investment adviser)

 

 

 

 

 

 

 

Gregory G. McGreevey - 1962

2012

Senior Managing Director, Invesco Ltd.;

N/A

N/A

Senior Vice President

 

Director, Chairman, President, and Chief

 

 

 

 

Executive Officer, Invesco Advisers, Inc.

 

 

 

 

(formerly known as Invesco Institutional

 

 

 

 

(N.A.), Inc.) (registered investment adviser);

 

 

 

 

Director, Invesco Mortgage Capital, Inc. and

 

 

 

 

Invesco Senior Secured Management, Inc.;

 

 

 

 

and Senior Vice President, The Invesco Funds;

 

 

 

 

and President, SNW Asset Management

 

 

 

 

Corporation and Invesco Managed Accounts,

 

 

 

 

LLC

 

 

 

 

Formerly: Senior Vice President, Invesco

 

 

 

 

 

 

 

75 INVESCO INTERMEDIATE BOND FACTOR FUND

TRUSTEES AND OFFICERS Continued

Name, Year of Birth and

Trustee

Principal Occupation(s)

Number of Funds

Other Directorship(s)

Position(s) Held with the Trust

and/or

During Past 5 Years

in Fund Complex

Held by Trustee During

 

Officer

 

Overseen by Trustee

Past 5 Years

 

Since

 

 

 

 

 

 

 

 

OFFICERS (CONTINUED)

 

 

 

 

 

 

 

 

 

Gregory G. McGreevey

 

Management Group, Inc. and Invesco Advisers,

 

 

(Continued)

 

Inc.; Assistant Vice President, The Invesco

 

 

 

 

Funds

 

 

 

 

 

 

 

Kelli Gallegos – 1970

2008

Principal Financial and Accounting Officer

N/A

N/A

Vice President, Principal

 

– Investments Pool, Invesco Specialized

 

 

Financial Officer and Assistant

 

Products, LLC; Vice President, Principal

 

 

Treasurer

 

Financial Officer and Assistant Treasurer,

 

 

 

 

The Invesco Funds; Principal Financial and

 

 

 

 

Accounting Officer – Pooled Investments,

 

 

 

 

Invesco Capital Management LLC; Vice

 

 

 

 

President and Treasurer, Invesco Exchange-

 

 

 

 

Traded Fund Trust, Invesco Exchange-Traded

 

 

 

 

Fund Trust II, Invesco India Exchange-Traded

 

 

 

 

Fund Trust, Invesco Actively Managed

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Commodity Fund

 

 

 

 

Trust and Invesco Exchange-Traded Self-

 

 

 

 

Indexed Fund Trust; Vice President, Invesco

 

 

 

 

Advisers, Inc.

 

 

 

 

Formerly: Assistant Treasurer, Invesco

 

 

 

 

Specialized Products, LLC; Assistant Treasurer,

 

 

 

 

Invesco Exchange-Traded Fund Trust, Invesco

 

 

 

 

Exchange-Traded Fund Trust II, Invesco India

 

 

 

 

Exchange-Traded Fund Trust, Invesco Actively

 

 

 

 

Managed Exchange-Traded Fund Trust,

 

 

 

 

Invesco Actively Managed Exchange-Traded

 

 

 

 

Commodity Fund Trust and Invesco Exchange-

 

 

 

 

Traded Self-Indexed Fund Trust; Assistant

 

 

 

 

Treasurer, Invesco Capital Management LLC;

 

 

 

 

Assistant Vice President, The Invesco Funds

 

 

 

 

 

 

 

Crissie M. Wisdom – 1969

2013

Anti-Money Laundering and OFAC Compliance

N/A

N/A

Anti-Money Laundering

 

Officer for Invesco U.S. entities including;

 

 

Compliance Officer

 

Invesco Advisers, Inc. and its affiliates, Invesco

 

 

 

 

Capital Markets, Inc., Invesco Distributors, Inc.,

 

 

 

 

Invesco Investment Services, Inc., The Invesco

 

 

 

 

Funds, Invesco Capital Management, LLC,

 

 

 

 

Invesco Trust Company; and Fraud Prevention

 

 

 

 

Manager for Invesco Investment Services, Inc.

 

 

 

 

 

 

 

Robert R. Leveille – 1969

2016

Chief Compliance Officer, Invesco Advisers,

N/A

N/A

Chief Compliance Officer

 

Inc. (registered investment adviser); and Chief

 

 

 

 

Compliance Officer, The Invesco Funds

 

 

 

 

Formerly: Chief Compliance Officer, Putnam

 

 

 

 

Investments and the Putnam Funds

 

 

 

 

 

 

 

76 INVESCO INTERMEDIATE BOND FACTOR FUND

The Statement of Additional Information of the Trust includes additional information about the Fund's Trustees and is available upon request, without charge, by calling 1.800.959.4246. Please refer to the Fund's Statement of Additional Information for information on the Fund's sub-advisers.

Office of the Fund

Investment Adviser

Distributor

Auditors

11 Greenway Plaza,

Invesco Advisers, Inc.

Invesco Distributors, Inc.

PricewaterhouseCoopers

Suite 1000

1555 Peachtree Street, N.E.

11 Greenway Plaza,

LLP

Houston, TX 77046-1173

Atlanta, GA 30309

Suite 1000

1000 Louisiana Street,

 

 

Houston, TX

Suite 5800

 

 

77046-1173

Houston, TX 77002-5021

Counsel to the Fund

Counsel to the

Transfer Agent

Custodian

Stradley Ronon Stevens & Young,

Independent Trustees

Invesco Investment

JPMorgan Chase Bank

LLP

Goodwin Procter LLP

Services, Inc.

4 Chase Metro Tech

2005 Market Street,

901 New York Avenue, N.W.

11 Greenway Plaza,

Center

Suite 2600

Washington, D.C. 20001

Suite 1000

Brooklyn, NY 11245

Philadelphia, PA 19103-7018

 

Houston, TX

 

 

 

77046-1173

 

77 INVESCO INTERMEDIATE BOND FACTOR FUND

INVESCO'S PRIVACY NOTICE

Invesco recognizes the importance of protecting your personal and financial information when you visit our website located at www.invesco.com (the "Website"). The following information is designed to help you understand the information collection practices at this Website. We will not sell, share or rent your personally identifiable information to others in contravention of this Privacy Policy. When we refer to ourselves as "we" or "Invesco" in this Privacy Policy, we mean our entire company including our affiliates, such as subsidiaries.

By visiting this Website, you are accepting the practices described in this Privacy Policy. If you do not agree to this policy, you may not use this Website. This Privacy Policy is subject to change without notice, from time to time in our sole discretion. You acknowledge that by accessing the Website after we have posted changes to this Privacy Policy, you are agreeing to this Privacy Policy as modified. Please review

the Terms of Use1 to learn of other terms and conditions applicable to your use of the Website.

Please note that this Privacy Policy is not an exclusive statement of our privacy principles across all products and services. Other privacy principles or policies may apply depending on the products or services you obtain from Invesco, or the jurisdiction in which you transact with Invesco.

This Privacy Policy was last updated on May 6, 2018.

Information We Collect and Use

We collect personal information you choose to submit to the Website in order to process transactions requested by you and meet our contractual obligations. For example, you can choose to provide your name, contact information, social security number, or tax identification number in connection with accessing your account, or you can choose to provide your personal information when you fill out a secure account question form. Any information collected about you from the Website can, from time to time, be associated with other identifying information we have about you.

In addition, we may gather information about you automatically through your use of the Website, e.g. your IP address, how you navigate the Website, the organization from which you are accessing the Website, and the websites that you access before and after you visit the Website.

When you access the Website, we may also collect information such as unique device identifiers, your screen resolution and other device settings, information about your location, and analytical information about how you use the device from which you are viewing the Website. Where applicable, we may ask your permission before collecting certain information, such as precise geolocation information.

From time to time, we use or augment the personal information we have about you with information obtained from third parties. For example, we use third party information to confirm contact or financial information or to better understand your interests by associating demographic information from third parties with the information you have provided.

How We Use Personal Information

We use your personal information to respond to your inquiries and provide the products and services you request. We also use your information from time to time to deliver the content and services we believe

1NTD

78 INVESCO INTERMEDIATE BOND FACTOR FUND

you will find the most relevant and to provide customer service and support.

We also use the information you provide to further develop and improve our products and services. We aggregate and/or de-identify data about visitors to the Website for various business purposes including product and service development and improvement activities.

How We Share Personal Information

We collaborate with other companies and individuals to perform services for us and on our behalf and we collaborate with our affiliates, other companies and individuals with respect to particular products or services ("Providers"). Examples of Providers include data analysis firms, customer service and support providers, email and SMS vendors, and web-hosting and development companies. Some Providers collect information for us or on our behalf on our Website. These Providers can be provided with access to personal information needed to perform their functions.

We reserve the right to disclose your personal information as required by law, when we believe disclosure is necessary to comply with a regulatory requirement, judicial proceeding, court order or legal process served on us, to protect the safety, rights or property of our customers, the public or Invesco or to enforce the Terms of Use.

If we sell or transfer a business unit (such as a subsidiary) or an asset (such as a website) to another company, we will share your personal information with such company. You will receive notice of such an event and the new entity will inform you of any changes to the practices in this Privacy Policy. If the new entity wishes to make additional use of your information, you have the right to decline such use at that time.

We occasionally disclose aggregate or de-identified data that is not personally identifiable with third parties.

Cookies and Other Tools

Invesco and its Providers collect information about you by using cookies, tracking pixels and other technologies. We use this information to better understand, customize and improve user experience with our websites, services and offerings as well as to manage our advertising. For example, we use web analytics services that use these technologies to gather information to help us understand how visitors engage with and navigate our Website, e.g., how and when pages in a site are visited and by how many visitors. We are also able to offer our visitors a more customized, relevant experience on our sites using these technologies by delivering content and functionality based on your preferences and interests.

Depending on their purpose, some cookies will only operate for the length of a single browsing session, while others have a longer life span to ensure that they fulfill their longer-term purposes. Your web browser can be set to allow you to control whether you will accept cookies or reject cookies, to notify you each time a cookie is sent to your browser, or to delete cookies that have already been set. If your browser is set to reject cookies, certain aspects of the Website that are cookie-enabled will not recognize you when you return to the website, and some Website functionality may be lost. The "Help" section of your browser may tell you how to prevent your browser from accepting cookies. To find out more about cookies, visit www.aboutcookies.org.

79 INVESCO INTERMEDIATE BOND FACTOR FUND

INVESCO'S PRIVACY NOTICE Continued

Security

No data transmission over the internet can be 100% secure, so Invesco cannot ensure or warrant the security of any information you submit to us on this Website. However, Invesco seeks to protect your personal information from unauthorized access or use when you transact business on our Website using technical, administrative and procedural measures. Invesco makes no representation as to the reasonableness, efficacy, or appropriateness of the measures we use to safeguard such information.

Users are responsible for maintaining the secrecy of their own passwords. If you have reason to believe that your interaction with us is no longer secure (for example, if you feel that the security of any account you might have with us has been compromised), please immediately notify us by contacting us as specified below.

Transfer of Data to Other Countries

Any information you provide to Invesco through use of the Website may be stored and processed, transferred between and accessed from the United States, Canada and other countries which do not guarantee the same level of protection of personal information as the one in which you reside. However, Invesco will handle your personal information in accordance with this Privacy Policy regardless of where your personal information is stored/accessed.

Children's Privacy

We are committed to protecting the privacy of children. We do not knowingly collect personal information from children under the age of 18. If you are under the age of 18, do not provide us with any personal information.

Contact Us

Please contact us if you have any questions or concerns about your personal information or require assistance in managing your choices.

Invesco Ltd.

1555 Peachtree St. NE Atlanta, GA 30309 By phone:

(404)439-3236 By fax:

(404)962-8288 By email: Anne.Gerry@invesco.com

Please update your account information by logging in or contact us by email or telephone as specified above to update your account information whenever such information ceases to be complete or accurate.

You may also contact us to:

80 INVESCO INTERMEDIATE BOND FACTOR FUND

Request that we amend, rectify, delete or update the personal data we hold about you;

Where possible (e.g. in relation to marketing) amend or update your choices around processing;

Request a copy of personal data held by us.

Disclaimer

Where the Website contains links to third-party websites/content/services that are not owned or controlled by Invesco, Invesco is not responsible for how these properties operate or treat your personal information so we recommend that you read the privacy policies and terms associated with these third party properties carefully.

81 INVESCO INTERMEDIATE BOND FACTOR FUND

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Invesco mailing information

Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Invesco Distributors, Inc.

O-INTI-AR-1 04302020

ITEM 2. CODE OF ETHICS.

There were no amendments to the Code of Ethics (the "Code") that applies to the Registrant's Principal Executive Officer ("PEO") and Principal Financial Officer ("PFO") during the period covered by the report. The Registrant did not grant any waivers, including implicit waivers, from any provisions of the Code to the PEO or PFO during the period covered by this report.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

The Board of Trustees has determined that the Registrant has at least one audit committee financial expert serving on its Audit Committee. The Audit Committee financial experts are David C. Arch, Bruce L. Crockett, Cynthia Hostetler, Elizabeth Krentzman, Anthony J. LaCava, Jr., Teresa M. Ressel, Jr., Robert C. Troccoli and James Vaughn. David C. Arch, Bruce L. Crockett, Cynthia Hostetler, Elizabeth Krentzman, Anthony J. LaCava, Jr., Teresa M. Ressel, Jr., Robert C. Troccoli and James Vaughn are "independent" within the meaning of that term as used in Form N-CSR.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

During the reporting period, PricewaterhouseCoopers LLC ("PwC") advised the Audit Committee of the following matters for consideration under the SEC's auditor independence rules. PwC advised the Audit Committee that a PwC Director, a PwC Manager and a PwC Senior Associate each held financial interests in investment companies within the Invesco Fund Complex that were inconsistent with the requirements of Rule 2-01(c)(1) of Regulation S-X. PwC noted, among other things, that during the time of its audit, the engagement team was not aware of the investments, (or with respect to the PwC Senior Associate was not aware until after the investments were confirmed as SEC exceptions), the individuals were not in the chain of command of the audit or the audit partners of Invesco or the affiliate of the Registrant, the services each individual provided were not relied upon by the audit engagement team with respect to the audit of the Registrant or its affiliates (or with respect to the PwC Senior Associate, the services were performed by an individual who did not have decision-making responsibility for matters that materially affected the audit and were reviewed by team members at least two levels higher than the PwC Senior Associate), and the investments were not material to the net worth of each individual or their respective immediate family members which PwC considered in reaching its conclusion. PwC advised the Audit Committee that it believes its objectivity and impartiality had not been adversely affected by these matters as they related to the audit of the Registrant.

On May 24, 2019, certain investment advisor subsidiaries of Invesco Ltd. assumed management responsibility from Oppenheimer Funds, Inc. ("OFI") for 83 open-end mutual funds and 20 exchange- traded funds (collectively, the "Oppenheimer Funds"). Assumption of management responsibility for the Oppenheimer Funds was accomplished through the reorganization of each Oppenheimer Fund into a new Invesco shell fund (collectively, the "New Invesco Funds") that did not have pre-existing assets (together, the "Reorganizations"). The Reorganizations were part of the acquisition by Invesco Ltd. (together with its subsidiaries, "Invesco") of the asset management business of OFI (including the Oppenheimer Funds) from Massachusetts Mutual Life Insurance Company ("MassMutual"), which was also consummated on May 24, 2019 (the "Acquisition"). Subsequent to the Acquisition, MassMutual became a significant shareholder of Invesco, and the Invesco Ltd. board of directors expanded by one director with the addition of a director selected by MassMutual.

Prior to the consummation of the Acquisition and the Reorganizations on May 24, 2019, PwC completed an independence assessment to evaluate the services and relationships with OFI and its affiliates, which became affiliates of Invesco upon the closing of the Acquisition. The assessment identified the following relationship and services that are inconsistent with the auditor independence rules under Rule 2-01 of

 

Regulation S-X ("Rule 2-01") if provided to an affiliate of an audit client. A retired PwC partner who receives a benefit from PwC that is not fully funded, served as a member of Audit Committee of the Boards of Trustees of certain Oppenheimer Funds prior to the Acquisition (the "Pre-Reorganization Relationship"). Additionally, PwC provided certain non-audit services including, expert legal services to one Oppenheimer Fund, custody of client assets in connection with payroll services, a non-audit service performed pursuant to a success-based fee, non-audit services in which PwC acted as an advocate on behalf of a MassMutual foreign affiliate and certain employee activities undertaken in connection with the provision of non-audit services for MassMutual and certain MassMutual foreign affiliates (collectively, the "Pre-Reorganization Services").

PwC and the Audit Committees of the New Invesco Funds each considered the impact that the Pre- Reorganization Relationship and Services have on PwC's independence with respect to the New Invesco Funds. On the basis of the nature of the relationship and services performed, and in particular the mitigating factors described below, PwC concluded that a reasonable investor, possessing knowledge of all the relevant facts and circumstances regarding the Pre-Reorganization Relationship and Services, would conclude that the Pre-Reorganization Relationship and Services do not impair PwC's ability to exhibit the requisite objectivity and impartiality to report on the financial statements of the New Invesco Funds for the years ending May 31, 2019 – April 30, 2020 ("PwC's Conclusion").

The Audit Committees of the Boards of Trustees of the New Invesco Funds, based upon PwC's Conclusion and the concurrence of Invesco, considered the relevant facts and circumstances including the mitigating factors described below and, after careful consideration, concluded that PwC is capable of exercising objective and impartial judgment in connection with its audits of the financial statements of the New Invesco Funds that the respective Boards of Trustees oversees.

Mitigating factors that PwC and the Audit Committees considered in reaching their respective conclusions included, among others, the following factors:

none of the Pre-Reorganization Relationship or Services created a mutuality of interest between PwC and the New Invesco Funds;

PwC will not act in a management or employee capacity for the New Invesco Funds or their affiliates during any portion of PwC's professional engagement period;

other than the expert legal services, Pre-Reorganization Services that have been provided to OFI, MassMutual and their affiliates do not have any impact on the financial statements of the New Invesco Funds;

as it relates to the expert legal services, while the service provided by PwC related to litigation involving one Oppenheimer Fund, the impact of the litigation on the Oppenheimer Fund's financial statements was based upon OFI's decision, and OFI management represented that the PwC service was not considered a significant component of its decision;

while certain employees of OFI who were involved in the financial reporting process of the Oppenheimer Funds will be employed by Invesco subsequent to the Reorganizations, existing officers of other Invesco Funds will serve as Principal Executive Officer and Principal Financial Officer or equivalent roles for the New Invesco Funds, and are ultimately responsible for the accuracy of all financial statement assertions for the entirety of the financial reporting periods for the New Invesco Funds;

the Pre-Reorganization Services giving rise to the lack of independence were provided to, or entered into with, OFI, MassMutual and their affiliates at a time when PwC had no independence restriction with respect to these entities;

 

with the exception of the expert legal service provided to one Oppenheimer Fund, none of the Pre- Reorganization Services affected the operations or financial reporting of the New Invesco Funds;

the Pre-Reorganization Services provided by PwC to OFI, MassMutual and their affiliates were performed by persons who were not, and will not be, part of the audit engagement team for the New Invesco Funds; and

the fees associated with the Pre-Reorganization Services were not material to MassMutual, Invesco or PwC.

(a) to (d)

Fees Billed by PwC Related to the Registrant

PwC billed the Registrant aggregate fees for services rendered to the Registrant for the last two fiscal years as shown in the following table. The Audit Committee pre-approved all audit and non-audit services provided to the Registrant.

 

 

 

Fees Billed for

Fees Billed for

 

Services Rendered to

Services Rendered to

 

 

the Registrant for

the Registrant for

 

fiscal year end 2020

fiscal year end 2019

Audit Fees

$

376,805

$

293,575

Audit-Related Fees(1)

$

6,200

$

0

 

Tax Fees(2)

$

219,598

$

60,350

All Other Fees

 

$

0

 

 

$

0

 

 

 

 

 

 

 

 

 

Total Fees

 

$

602,603

$

353,925

(1)Audit-Related Fees for the fiscal year end February 29, 2020 includes fees billed for reviewing regulatory filings.

(2)Tax Fees for the fiscal year end February 29, 2020 includes fees billed for preparation of U.S. Tax Returns and Taxable Income calculations, including excise tax and year-to-date estimates for various book-to-tax differences. Tax fees for fiscal year end February 28, 2019 includes fees billed for reviewing tax returns and/or services related to tax compliance.

Fees Billed by PwC Related to Invesco and Invesco Affiliates

PwC billed Invesco Advisers, Inc. ("Invesco"), the Registrant's adviser, and any entity controlling, controlled by or under common control with Invesco that provides ongoing services to the Registrant ("Invesco Affiliates") aggregate fees for pre-approved non-audit services rendered to Invesco and Invesco Affiliates for the last two fiscal years as shown in the following table. The Audit Committee pre-approved all non-audit services provided to Invesco and Invesco Affiliates that were required to be pre-approved.

 

 

Fees Billed for Non-

 

 

 

 

 

Audit Services

Fees Billed for Non-Audit

 

Rendered to Invesco

Services Rendered to

 

and Invesco Affiliates

Invesco and Invesco

 

for fiscal year end

Affiliates for fiscal year

 

2020 That Were

end 2019 That Were

 

 

 

Required

 

 

Required

 

to be Pre-Approved

to be Pre-Approved

 

by the Registrant's

by the Registrant's

 

Audit Committee

Audit Committee

 

 

 

 

 

 

 

 

 

Audit-Related Fees(1)

$

690,000

$

690,000

 

Tax Fees

$

0

 

$

0

All Other Fees

 

$

0

 

 

$

0

 

 

 

 

 

 

 

 

 

Total Fees

$

690,000

$

690,000

(1)Audit-Related Fees for the fiscal years ended 2020 and 2019 include fees billed related to reviewing controls at a service organization.

(e)(1)

PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES

POLICIES AND PROCEDURES As adopted by the Audit Committees of the Invesco Funds (the "Funds")

Last Amended March 29, 2017

I.Statement of Principles

The Audit Committees (the "Audit Committee") of the Boards of Trustees of the Funds (the "Board") have adopted these policies and procedures (the "Procedures") with respect to the pre- approval of audit and non-audit services to be provided by the Funds' independent auditor (the "Auditor") to the Funds, and to the Funds' investment adviser(s) and any entity controlling, controlled by, or under common control with the investment adviser(s) that provides ongoing services to the Funds (collectively, "Service Affiliates").

Under Section 202 of the Sarbanes-Oxley Act of 2002, all audit and non-audit services provided to the Funds by the Auditor must be preapproved by the Audit Committee. Rule 2-01 of Regulation S-X requires that the Audit Committee also pre-approve a Service Affiliate's engagement of the Auditor for non-audit services if the engagement relates directly to the operations and financial reporting of the Funds (a "Service Affiliate's Covered Engagement").

These Procedures set forth the procedures and the conditions pursuant to which the Audit Committee may pre-approve audit and non-audit services for the Funds and a Service Affiliate's Covered Engagement pursuant to rules and regulations of the Securities and Exchange Commission ("SEC") and other organizations and regulatory bodies applicable to the Funds

 

("Applicable Rules").1 They address both general pre-approvals without consideration of specific case-by-case services ("general pre-approvals") and pre-approvals on a case-by-case basis ("specific pre-approvals"). Any services requiring pre-approval that are not within the scope of general pre-approvals hereunder are subject to specific pre-approval. These Procedures also address the delegation by the Audit Committee of pre-approval authority to the Audit Committee Chair or Vice Chair.

II.Pre-Approval of Fund Audit Services

The annual Fund audit services engagement, including terms and fees, is subject to specific pre- approval by the Audit Committee. Audit services include the annual financial statement audit and other procedures required to be performed by an independent auditor to be able to form an opinion on the Funds' financial statements. The Audit Committee will receive, review and consider sufficient information concerning a proposed Fund audit engagement to make a reasonable evaluation of the Auditor's qualifications and independence. The Audit Committee will oversee the Fund audit services engagement as necessary, including approving any changes in terms, audit scope, conditions and fees.

In addition to approving the Fund audit services engagement at least annually and specifically approving any changes, the Audit Committee may generally or specifically pre-approve engagements for other audit services, which are those services that only an independent auditor reasonably can provide. Other audit services may include services associated with SEC registration statements, periodic reports and other documents filed with the SEC.

III.General and Specific Pre-Approval of Non-Audit Fund Services

The Audit Committee will consider, at least annually, the list of General Pre-Approved Non- Audit Services which list may be terminated or modified at any time by the Audit Committee. To inform the Audit Committee's review and approval of General Pre-Approved Non-Audit Services, the Funds' Treasurer (or his or her designee) and Auditor shall provide such information regarding independence or other matters as the Audit Committee may request.

Any services or fee ranges that are not within the scope of General Pre-Approved Non-Audit Services have not received general pre-approval and require specific pre-approval. Each request for specific pre-approval by the Audit Committee for services to be provided by the Auditor to the Funds must be submitted to the Audit Committee by the Funds' Treasurer (or his or her designee) and must include detailed information about the services to be provided, the fees or fee ranges to be charged, and other relevant information sufficient to allow the Audit Committee to consider whether to pre-approve such engagement, including evaluating whether the provision of such services will impair the independence of the Auditor and is otherwise consistent with Applicable Rules.

1Applicable Rules include, for example, New York Stock Exchange ("NYSE") rules applicable to closed-end funds managed by Invesco and listed on NYSE.

 

IV. Non-Audit Service Types

The Audit Committee may provide either general or specific pre-approval of audit-related, tax or other services, each as described in more detail below.

a.Audit-Related Services

"Audit-related services" are assurance and related services that are reasonably related to the performance of the audit or review of the Fund's financial statements or that are traditionally performed by an independent auditor. Audit-related services include, among others, accounting consultations related to accounting, financial reporting or disclosure matters not classified as "Audit services"; assistance with understanding and implementing new accounting and financial reporting guidance from rulemaking authorities; services related to mergers, acquisitions or dispositions; compliance with ratings agency requirements and interfund lending activities; and assistance with internal control reporting requirements.

b.Tax Services

"Tax services" include, but are not limited to, the review and signing of the Funds' federal tax returns, the review of required distributions by the Funds and consultations regarding tax matters such as the tax treatment of new investments or the impact of new regulations. The Audit Committee will not approve proposed services of the Auditor which the Audit Committee believes are to be provided in connection with a service or transaction initially recommended by the Auditor, the sole business purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Internal Revenue Code and related regulations. The Audit Committee will consult with the Funds' Treasurer (or his or her designee) and may consult with outside counsel or advisers as necessary to ensure the consistency of tax services rendered by the Auditor with the foregoing policy. The Auditor shall not represent any Fund or any Service Affiliate before a tax court, district court or federal court of claims.

Each request to provide tax services under either the general or specific pre-approval of the Audit Committee will include a description from the Auditor in writing of (i) the scope of the service, the fee structure for the engagement, and any side letter or other amendment to the engagement letter, or any other agreement (whether oral, written, or otherwise) between the Auditor and the Funds, relating to the service; and (ii) any compensation arrangement or other agreement, such as a referral agreement, a referral fee or fee-sharing arrangement, between the Auditor (or an affiliate of the Auditor) and any person (other than the Funds or Service Affiliates receiving the services) with respect to the promoting, marketing, or recommending of a transaction covered by the service. The Auditor will also discuss with the Audit Committee the potential effects of the services on the independence of the Auditor, and document the substance of its discussion with the Audit Committee.

c.Other Services

The Audit Committee may pre-approve other non-audit services so long as the Audit Committee believes that the service will not impair the independence of the Auditor. Appendix I includes a list of services that the Auditor is prohibited from performing by the SEC rules. Appendix I also

 

includes a list of services that would impair the Auditor's independence unless the Audit Committee reasonably concludes that the results of the services will not be subject to audit procedures during an audit of the Funds' financial statements.

V.Pre-Approval of Service Affiliate's Covered Engagements

Rule 2-01 of Regulation S-X requires that the Audit Committee pre-approve a Service Affiliate's engagement of the Auditor for non-audit services if the engagement relates directly to the operations and financial reporting of the Funds, defined above as a "Service Affiliate's Covered Engagement".

The Audit Committee may provide either general or specific pre-approval of any Service Affiliate's Covered Engagement, including for audit-related, tax or other services, as described above, if the Audit Committee believes that the provision of the services to a Service Affiliate will not impair the independence of the Auditor with respect to the Funds. Any Service Affiliate's Covered Engagements that are not within the scope of General Pre-Approved Non- Audit Services have not received general pre-approval and require specific pre-approval.

Each request for specific pre-approval by the Audit Committee of a Service Affiliate's Covered Engagement must be submitted to the Audit Committee by the Funds' Treasurer (or his or her designee) and must include detailed information about the services to be provided, the fees or fee ranges to be charged, a description of the current status of the pre-approval process involving other audit committees in the Invesco investment company complex (as defined in Rule 2-201 of Regulation S-X) with respect to the proposed engagement, and other relevant information sufficient to allow the Audit Committee to consider whether the provision of such services will impair the independence of the Auditor from the Funds. Additionally, the Funds' Treasurer (or his or her designee) and the Auditor will provide the Audit Committee with a statement that the proposed engagement requires pre-approval by the Audit Committee, the proposed engagement, in their view, will not impair the independence of the Auditor and is consistent with Applicable Rules, and the description of the proposed engagement provided to the Audit Committee is consistent with that presented to or approved by the Invesco audit committee.

Information about all Service Affiliate engagements of the Auditor for non-audit services, whether or not subject to pre-approval by the Audit Committee, shall be provided to the Audit Committee at least quarterly, to allow the Audit Committee to consider whether the provision of such services is compatible with maintaining the Auditor's independence from the Funds. The Funds' Treasurer and Auditor shall provide the Audit Committee with sufficiently detailed information about the scope of services provided and the fees for such services, to ensure that the Audit Committee can adequately consider whether the provision of such services is compatible with maintaining the Auditor's independence from the Funds.

VI. Pre-Approved Fee Levels or Established Amounts

Pre-approved fee levels or ranges for audit and non-audit services to be provided by the Auditor to the Funds, and for a Service Affiliate's Covered Engagement, under general pre-approval or specific pre-approval will be set periodically by the Audit Committee. Any proposed fees

 

exceeding 110% of the maximum pre-approved fee levels or ranges for such services or engagements will be promptly presented to the Audit Committee and will require specific pre- approval by the Audit Committee before payment of any additional fees is made.

VII. Delegation

The Audit Committee hereby delegates, subject to the dollar limitations set forth below, specific authority to its Chair, or in his or her absence, Vice Chair, to pre-approve audit and non-audit services proposed to be provided by the Auditor to the Funds and/or a Service Affiliate's Covered Engagement, between Audit Committee meetings. Such delegation does not preclude the Chair or Vice Chair from declining, on a case by case basis, to exercise his or her delegated authority and instead convening the Audit Committee to consider and pre-approve any proposed services or engagements.

Notwithstanding the foregoing, the Audit Committee must pre-approve: (a) any non-audit services to be provided to the Funds for which the fees are estimated to exceed $500,000; (b) any Service Affiliate's Covered Engagement for which the fees are estimated to exceed $500,000; or

(c)any cost increase to any previously approved service or engagement that exceeds the greater of $250,000 or 50% of the previously approved fees up to a maximum increase of $500,000.

VIII. Compliance with Procedures

Notwithstanding anything herein to the contrary, failure to pre-approve any services or engagements that are not required to be pre-approved pursuant to the de minimis exception provided for in Rule 2-01(c)(7)(i)(C) of Regulation S-X shall not constitute a violation of these Procedures. The Audit Committee has designated the Funds' Treasurer to ensure services and engagements are pre-approved in compliance with these Procedures. The Funds' Treasurer will immediately report to the Chair of the Audit Committee, or the Vice Chair in his or her absence, any breach of these Procedures that comes to the attention of the Funds' Treasurer or any services or engagements that are not required to be pre-approved pursuant to the de minimis exception provided for in Rule 2-01(c)(7)(i)(C) of Regulation S-X.

On at least an annual basis, the Auditor will provide the Audit Committee with a summary of all non-audit services provided to any entity in the investment company complex (as defined in section 2-01(f)(14) of Regulation S-X, including the Funds and Service Affiliates) that were not pre-approved, including the nature of services provided and the associated fees.

IX. Amendments to Procedures

All material amendments to these Procedures must be approved in advance by the Audit Committee. Non-material amendments to these Procedures may be made by the Legal and Compliance Departments and will be reported to the Audit Committee at the next regularly scheduled meeting of the Audit Committee.

 

Appendix I

Non-Audit Services That May Impair the Auditor's Independence

The Auditor is not independent if, at any point during the audit and professional engagement, the Auditor provides the following non-audit services:

Management functions;

Human resources;

Broker-dealer, investment adviser, or investment banking services ;

Legal services;

Expert services unrelated to the audit;

Any service or product provided for a contingent fee or a commission;

Services related to marketing, planning, or opining in favor of the tax treatment of confidential transactions or aggressive tax position transactions, a significant purpose of which is tax avoidance;

Tax services for persons in financial reporting oversight roles at the Fund; and

Any other service that the Public Company Oversight Board determines by regulation is impermissible.

An Auditor is not independent if, at any point during the audit and professional engagement, the Auditor provides the following non-audit services unless it is reasonable to conclude that the results of the services will not be subject to audit procedures during an audit of the Funds' financial statements:

Bookkeeping or other services related to the accounting records or financial statements of the audit client;

Financial information systems design and implementation;

Appraisal or valuation services, fairness opinions, or contribution-in-kind reports;

Actuarial services; and

Internal audit outsourcing services.

(e)(2) There were no amounts that were pre-approved by the Audit Committee pursuant to the de minimus exception under Rule 2-01 of Regulation S-X.

(f)Not applicable.

(g)In addition to the amounts shown in the tables above, PwC billed Invesco and Invesco Affiliates aggregate fees of $4,089,000 for the fiscal year ended February 29, 2020 and $3,550,000 for the fiscal year ended February 28, 2019 for non-audit services not required to be pre-approved by the Registrant's Audit Committee. In total, PwC billed the Registrant, Invesco and Invesco Affiliates aggregate non-audit fees of $4,998,598 for the fiscal year ended February 29, 2020 and $4,300,350 for the fiscal year ended February 28, 2019.

PwC provided audit services to the Investment Company complex of approximately $33 million.

 

(h)The Audit Committee also has considered whether the provision of non-audit services that were rendered to Invesco and Invesco Affiliates that were not required to be pre-approved pursuant to SEC regulations, if any, is compatible with maintaining PwC's independence.

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 April 14, 2020, 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 April 14, 2020, 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)

Code of Ethics.

13(a) (2)

Certifications of principal executive officer and principal financial officer as required by

 

Rule 30a-2(a) under the Investment Company Act of 1940 and Section 302 of the

 

Sarbanes-Oxley Act of 2002.

13(a) (3)

Not applicable.

13(a) (4)

Not applicable.

13(b)

Certifications of principal executive officer and principal financial officer as required by

 

Rule 30a-2(b) under the Investment Company Act of 1940 and Section 906 of the

 

Sarbanes-Oxley Act of 2002.

 

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 Investment Securities Funds (Invesco Investment Securities Funds)

By:

/s/ Sheri Morris

 

Sheri Morris

 

Principal Executive Officer

Date:

May 6, 2020

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:

May 6, 2020

By:

/s/ Kelli Gallegos

 

Kelli Gallegos

 

Principal Financial Officer

Date:

May 6, 2020

THE INVESCO FUNDS CODE OF ETHICS FOR COVERED OFFICERS

I.Introduction

The Boards of Trustees ("Board") of the Invesco Funds (the "Funds") have adopted this code of ethics (this "Code") applicable to their Principal Executive Officer and Principal Financial Officer (or persons performing similar functions) (collectively, the "Covered Officers") to promote:

honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

full, fair, accurate, timely and understandable disclosure in reports and documents filed with, or submitted to, the Securities and Exchange Commission ("SEC") and in other public communications made by the Funds;

compliance with applicable governmental laws, rules and regulations;

the prompt internal reporting of violations to the Code to an appropriate person or persons identified in the Code; and

accountability for adherence to the Code.

II. Covered Officers Should Act Honestly and Candidly

Each Covered Officer named in Exhibit A to this Code owes a duty to the Funds to act with integrity. Integrity requires, among other things, being honest and candid. Deceit and subordination of principle are inconsistent with integrity.

Each Covered Officer must:

act with integrity, including being honest and candid while still maintaining the confidentiality of information where required by law or the Funds' policies;

observe both the form and spirit of laws and governmental rules and regulations, accounting standards and policies of the Funds;

adhere to a high standard of business ethics; and

place the interests of the Funds and their shareholders before the Covered Officer's own personal interests.

Business practices Covered Officers should be guided by and adhere to these fiduciary standards.

III.Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest

Guiding Principles. A "conflict of interest" occurs when an individual's personal interest actually or potentially interferes with the interests of the Funds or their shareholders. A conflict of interest can arise when a Covered Officer takes actions or has interests that may make it difficult to perform his or her duties as a Fund officer objectively and effectively. For example, a conflict of interest would arise if a Covered Officer, or a member of his or her family, receives improper personal benefits as a result of his or her position as a Fund officer. In addition, investment companies should be sensitive to situations that create apparent, but not actual, conflicts of interest. Service to the Funds should never be subordinated to personal gain an advantage.

Certain conflicts of interest covered by this Code arise out of the relationships between Covered Officers and the Funds that already are subject to conflict of interest provisions in the Investment Company Act of 1940, as amended and the Investment Advisers Act of 1940, as amended. For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Funds because of their status as "affiliated persons" of the Funds. Therefore, as to the existing statutory and regulatory prohibitions on individual behavior, they will be deemed to be incorporated in this Code and therefore any material violation will also be deemed a violation of this Code. Covered Officers must in all cases comply with applicable statutes and regulations.

In addition, the Funds and their investment adviser have adopted Codes of Ethics designed to prevent, identify and/or correct violations of these statutes and regulations. This Code does not, and is not intended to, repeat or replace such Codes of Ethics.

As to conflicts arising from, or as a result of the contractual relationship between, the Funds and the investment adviser of which the Covered Officers are also officers or employees, it is recognized by the Board that, subject to the adviser's fiduciary duties to the Funds, the Covered Officers will in the normal course of their duties (whether formally for the Funds or for the adviser, or for both) be involved in establishing policies and implementing decisions which will have different effects on the adviser and the Funds. The Board recognizes that the participation of the Covered Officers in such activities is inherent in the contractual relationship between the Funds and the adviser and is consistent with the expectation of the Board of the performance by the Covered Officers of their duties as officers of the Funds. In addition, it is recognized by the Board that the Covered Officers may also be officers or employees of other investment companies advised or serviced by the same adviser and the codes which apply to senior officers of those investment companies will apply to the Covered Officers acting in those distinct capacities.

Each Covered Officer must:

avoid conflicts of interest wherever possible;

handle any actual or apparent conflict of interest ethically;

not use his or her personal influence or personal relationships to influence investment decisions or financial reporting by an investment company whereby the Covered Officer would benefit personally to the detriment of any of the Funds;

not cause an investment company to take action, or fail to take action, for the personal benefit of the Covered Officer rather than the benefit of such company;

not use knowledge of portfolio transactions made or contemplated for an investment company to profit or cause others to profit, by the market effect of such transactions; and

as described in more detail below, discuss any material transaction or relationship that could reasonably be expected to give rise to a conflict of interest with the Chief Compliance Officer of the Funds (the "CCO").

Some conflict of interest situations that should always be discussed with the CCO, if material, include the following:

any outside business activity that detracts from an individual's ability to devote appropriate time and attention to his or her responsibilities with the Funds;

being in the position of supervising, reviewing or having any influence on the job evaluation, pay or benefit of any immediate family member;

any direct ownership interest in, or any consulting or employment relationship with, any of the

Funds' service providers, other than its investment adviser, distributor or other Invesco Ltd. affiliated entities and other than a de minimis ownership interest (for purposes of this section of the Code an ownership interest of 1% or less shall constitute a de minimis ownership interest, and an ownership interest of more than 1% creates a rebuttable presumption that there may be a material conflict of interest); and

a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Funds for effecting portfolio transactions or for selling or redeeming shares, other than an interest arising from the Covered Officer's employment with Invesco, its subsidiaries, its parent organizations and any affiliates or subsidiaries thereof, such as compensation or equity ownership, and other than an interest arising from a de minimis ownership interest in a company with which the Funds execute portfolios transactions or a company that receives commissions or other fees related to its sales and redemptions of shares of the Funds (for purposes of this section of the Code an ownership interest of 1% or less shall constitute a de minimis ownership interest, and an ownership interest of more than 1% creates a rebuttable presumption that there may be a material conflict of interest).

IV. Disclosure

Each Covered Officer is required to be familiar, and comply, with the Funds' disclosure controls and procedures so that the Funds' subject reports and documents filed with the SEC comply in all material respects with the applicable federal securities laws and SEC rules. In addition, each Covered Officer having direct or supervisory authority regarding these SEC filings or the Funds' other public communications should, to the extent appropriate within his area of responsibility, consult with other officers and employees of the Funds and take other appropriate steps regarding these disclosures with the goal of making full, fair, accurate, timely and understandable disclosure.

Each Covered Officer must:

familiarize himself/herself with the disclosure requirements applicable to the Funds as well as the business and financial operations of the Funds; and

not knowingly misrepresent, or cause others to misrepresent, facts about the Funds to others, whether within or outside the Funds, including representations to the Funds' internal auditors, independent Directors/Trustees, independent auditors, and to governmental regulators and self-regulatory organizations.

V.Compliance

It is the Funds' policy to comply in all material respects with all applicable governmental laws, rules and regulations. It is the personal responsibility of each Covered Officer to adhere to the standards and restrictions imposed by those laws, rules and regulations, including those relating to affiliated transactions, accounting and auditing matters.

VI.

Reporting and Accountability

Each Covered Officer must:

upon becoming a Covered Officer and receipt of this Code, sign and submit to the CCO of the Funds (or the CCO's designee) an acknowledgement stating that he or she has received, read, and understands this Code.

annually thereafter submit a form to the CCO of the Funds (or the CCO's designee) confirming that he or she has received, read and understands this Code and has complied with the requirements of this Code.

not retaliate against any employee or other Covered Officer for reports of potential violations that are made in good faith.

notify the CCO promptly if he becomes aware of any existing or potential violation of this Code. Failure to do so is itself a violation of this Code.

Except as described otherwise below, the CCO is responsible for applying this Code to specific situations in which questions are presented to him or her and has the authority to interpret this Code in any particular situation. The CCO shall take all action he or she considers appropriate to investigate any actual or potential violations reported to him or her.

The CCO is authorized to consult, as appropriate, with the Chairman of the Audit Committees of the Board, counsel to the Funds and counsel to the Board members who are not "interested persons" of the Funds as defined in the 1940 Act ("Independent Trustees"), and is encouraged to do so.

The CCO is responsible for granting waivers and determining sanctions, as appropriate. In addition, approvals, interpretations, or waivers sought by the Covered Officers may also be considered by the Chairman of the Audit Committees of the Board.

The Funds will follow these procedures in investigating and enforcing this Code, and in reporting on the Code:

the CCO will take all appropriate action to investigate any potential violations reported to him or her;

any matter that the CCO believes is a violation or potential violation will be reported to the Chairman of the Audit Committees of the Board after such investigation;

if the Chairman of the Audit Committees concurs that a violation has occurred, he or she will inform the Board, which will take all appropriate disciplinary or preventive action;

appropriate disciplinary or preventive action may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered Officer; a letter of censure, suspension, dismissal; or, in the event of criminal or other serious violations of law, notification to the SEC or other appropriate law enforcement authorities;

the CCO will be responsible for granting waivers of this Code, as appropriate; and

any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules.

VII.

Other Policies and Procedures

The Funds' and the Advisers' and Principal Underwriters' codes of ethics under Rule 17j-1 under the Investment Company Act and the Advisers' more detailed policies and procedures set forth in its Compliance and Supervisory Procedures Manual are separate requirements applying to Covered Officers and others, and are not part of this Code.

VIII. Amendments

Any material amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the Funds' Board, including a majority of Independent Trustees.

IX. Confidentiality

All reports and records prepared or maintained pursuant to this Code shall be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the members of the Funds' Board, counsel to the Funds, counsel to the Independent Trustees.

Exhibit A

Persons Covered by this Code of Ethics:

Sheri Morris – Principal Executive Officers

Kelli Gallegos – Principal Financial Officer

INVESCO FUNDS

CODE OF ETHICS FOR COVERED OFFICERS--ACKNOWLEDGEMENT

I hereby acknowledge that I am a Principal Officer of the Funds and I am aware of and subject to the Funds' Code of Ethics for Covered Officers. Accordingly, I have read and understood the requirements of the Code of Ethics for Covered Officers and I am committed to fully comply with the Code of Ethics for Covered Officers

I also recognize my obligation to promote:

1.Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

2.Full, fair, accurate, timely, and understandable disclosure in reports and documents that the Funds file with, or submit to, the Commission and in other public communications made by the Funds; and

3.Compliance with applicable governmental laws, rules, and regulations.

4.The prompt internal reporting of violations to the Code to an appropriate person or persons identified in the Code; and

5.Accountability for adherence to the Code.

Date

 

Name:

 

 

Title:

I, Sheri Morris, Principal Executive Officer, certify that:

1.I have reviewed this report on Form N-CSR of AIM Investment Securities Funds (Invesco Investment Securities Funds);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of trustees (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 6, 2020

/s/ Sheri Morris

 

Sheri Morris, Principal Executive Officer

I, Kelli Gallegos, Principal Financial Officer, certify that:

1.I have reviewed this report on Form N-CSR of AIM Investment Securities Funds (Invesco Investment Securities Funds);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of trustees (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 6, 2020

/s/ Kelli Gallegos

 

Kelli Gallegos, Principal Financial Officer

CERTIFICATION OF SHAREHOLDER REPORT

In connection with the Certified Shareholder Report of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Company") on Form N-CSR for the period ended February 29, 2020, as filed with the Securities and Exchange Commission (the "Report"), I, Sheri Morris, Principal Executive Officer of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 6, 2020

/s/ Sheri Morris

 

Sheri Morris, Principal Executive Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided by the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

CERTIFICATION OF SHAREHOLDER REPORT

In connection with the Certified Shareholder Report of AIM Investment Securities Funds (Invesco Investment Securities Funds) (the "Company") on Form N-CSR for the period ended February 29, 2020, as filed with the Securities and Exchange Commission (the "Report"), I, Kelli Gallegos, Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 6, 2020

/s/ Kelli Gallegos

 

Kelli Gallegos, Principal Financial Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided by the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.