Important Information:

• The Fund invests primarily in debt securities whose issuers, guarantors and/or domiciled countries could or would directly or indirectly benefit from China’s Belt and Road vision of increasing land and sea paths to connect Asia, Europe, Middle East and Africa and their adjacent seas for closer economic co-operation.
• Investors should note the general investment risk, risk of misalignment between the Fund’s investment theme and the Belt and Road vision, risks of investing in companies related to the Belt and Road Initiative, emerging markets, liquidity risk, sovereign debt risk, portfolio turnover risk, Eurozone risk, hedged unit classes risk, RMB class(es) related risk, counterparty risk, and currency and foreign exchange risk.
• Debt Securities are subject to (a) interest rate risk; (b) credit risk (including default risk, credit rating risk, credit rating downgrading risk and liquidity risk); (c) risks relating to below investment grade and unrated securities; and (d) valuation risk.
• Financial derivative instruments may be used for hedging. The use of derivatives may become ineffective and the Fund may suffer significant losses.
• For Monthly Distribution-1 unit class (MD1), (a) the Fund Manager may at discretion pay distributions out of the capital and/or effectively out of capital amounts to a return or withdrawal of part of an investor’s original investment or from any capital gains attributable to that original investment. Any such distributions may result in an immediate reduction of the net asset value per unit in respect of such unit class after the distribution date; (b) Investments in MD1 are not an alternative to a savings account or fixed-interest paying investment, investors may not be able to get back the original investment amount; and (c) The fixed amount of distributions per month is subject to risk of exchange rate fluctuations.
• In addition, investors of MD-1 that are currency hedged (MD1 hedged) should be aware of the uncertainty of relative interest rates. The net asset value of the MD1 hedged may fluctuate and may significantly differ from other unit class due to fluctuation of the interest rate differential between the currency in which the MD1 hedged is denominated and the base currency of the Fund and may result in a greater erosion of capital than other non-hedged unit class.
• The value of the Fund can be volatile and could go down substantially.
• Investors should not base their investment decision on this material alone.

Hong Kong, March 1, 2018 - Invesco today launched the Invesco Belt and Road Fund (“the Fund”), providing a timely and an attractive platform for investors to capture investment opportunities driven by the “Belt and Road” (“B&R”) initiative. 

B&R is a systemic initiative and significant development strategy launched by the Chinese government to promote the land and sea connectivity along Asia, Europe, Middle East, and Africa and their adjacent seas (“the B&R region”), establishing and strengthening economic partnerships and cooperation along countries in these regions¹.

“We are proud to be first to the market with a fixed income mutual fund that provides investors direct exposure to the Belt & Road investment theme,” said Terry Pan, Chief Executive Officer Greater China, Southeast Asia and Korea at Invesco. “This transformational program will impact a variety of industries across developed and developing markets, and we believe the Fund could be a suitable fit for investors seeking long-term potential capital growth and sustainable income.”

The Fund is a thematic portfolio which aims to achieve long-term total returns, both in terms of income and capital growth, by investing primarily in debt securities whose issuers, guarantors and/or domiciled countries could directly or indirectly benefit from the B&R vision. 

The vision for the B&R initiative was first officially outlined in September 2013 by China President Xi Jinping to increase the linkages between China and Central Asia, harkening back to the mutual economic development generated by the ancient Silk Road. Plans have since expanded to include 100 signed cooperation agreements with 86 countries and international organizations².

More recently, the B&R initiative was written into the Chinese Constitution during the 19th Communist Party of China National Congress meeting in October 2017. This ensures it will remain a long-term priority for government authorities and private enterprises.

“The growing outward direct investment of China is expected to flow to B&R countries, which leads to stronger economic co-operations and productivity growth in the B&R region. The solvency and liquidity of most of the B&R countries will tend to improve, paving the way for an upgrade trend of their sovereign credit ratings. This trend would also benefit the credit profiles of banking systems, state-owned enterprises and private-enterprises in B&R countries, making their bonds more compelling,” said Ken Hu, Chief Investment Officer, Fixed Income, Asia Pacific at Invesco.

Ken Hu added: “More than US$600 billion of B&R related financial commitments have been announced by major Chinese institutions. We forecast US$150-200 billion will be invested annually from China into B&R countries over at least the next five years. With rising economic activity in the B&R region, both government and non-government issuers will need to issue more bonds for financing. As such, selective new issues of bonds in the B&R region will provide higher yields than bonds with similar credit ratings and maturities in traditional bond markets. In general, we expect B&R bonds to provide attractive investment opportunities in terms of favorable yields and capital gain potential.”

The Fund will invest primarily in government bonds of developing countries along the B&R region and non-government bonds of both developed and developing countries along the B&R region, creating a diversified portfolio of sovereign, quasi-government and corporate bonds. For better liquidity, the Fund will focus on bonds denominated in major currencies traded in international bond markets.

Managing over US$311 billion, Invesco’s fixed income team is one of the world's leading fixed income managers with over 170 fixed income investment professionals and offices in North America, Europe and Asia, all singularly focused on uncovering and delivering value for clients.

¹National Development and Reform Commission, March 2015; HKTDC Research “The Belt and Road Initiative”, September 2017.

²“China signs cooperation agreements with 86 entities under Belt and Road.” Xinhua 23 December 2017.

About Invesco Ltd.

Invesco is an independent investment management firm dedicated to delivering an investment experience that helps people get more out of life. NYSE: IVZ; www.invesco.com.

Important information

All data are sourced from Invesco dated December 31, 2017, unless otherwise stated.

Investment involves risks. Investors should read the relevant prospectus for details, including the risk factors and product features. This document has not been reviewed by the Securities and Futures Commission of Hong Kong and is issued by Invesco Hong Kong Limited（景順投資管理有限公司）.

Where Terry Pan and Ken Hu has expressed opinions, they are based on current market conditions and are subject to change without notice. These opinions may differ from those of other Invesco investment professionals.