ETF Edge - Searching for a Bottom in Bond Funds & Passive vs. Active Update 06/06/22

Episode Date: June 6, 2022

CNBC’s Bob Pisani spoke with Jerome Schneider, Head of Short-Term Portfolio Management at PIMCO – along with Dan Wiener, editor of The Independent Adviser for Vanguard Investments and Chairman of Adviser Investments and Todd Rosenbluth, Director of Research at Vetta-Fi. They discussed ETF flows as bond funds finally experience a reversal in fortune and start to enjoy inflows again – following a dismal first half of 2022. Could this be the bottom investors have been waiting for? Plus, they weighed in the active vs. passive debate – as passive indexing overtakes active funds for the first time ever in the U.S. In the Markets ‘102’ portion of the podcast, Bob continues the conversation with Dan Wiener from Adviser Investments. Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com for information about our collection and use of personal data for advertising.

The ETF Edge podcast is sponsored by InvescoQQQ, Supporting the Innovators Changing the World, Investco Distributors, Inc. Welcome to ETF Edge, the podcast. If you're looking to learn the latest insights on all things exchanged traded funds, you're in the right place. Every week, we're bringing you interviews, market analysis, and breaking down what it all means for investors. I'm your host, Bob Pisani. Today on the show, our bond funds finally bottoming out. After a dismal first half of the year, high yield and treasury ETFs finally starting to get some love in the form of inflows again. Could this mark important bottom investors have been looking for? Plus, a new report shows passive indexing has surpassed active funds for the first time. We'll get more on the great debate between active and passive investing. Here's my conversation with Jerome Schneider, head of short-term portfolio management at PINCO, along with Dan Wiener, editor of the Independent Advisor for Vanguard Investments and Chairman of Advisor

Investments. And Todd Rosenbluth as well, he's the director of research at VETify. Jerome, let me start with you. All bond funds, bond ETFs have seen outflows this year, including yours, but that has changed a bit in the last few weeks. Bond prices are generally down, though, last week. They're down again today. Yields are up. Reconciled this for us. Why aren't these inflows just to pause, and why won't they turn into outflows again if the Fed is going to continue its hawkish policies? It's a great question, Bob. And honestly, the playing field has fundamentally changed since late last year and early this year.

We moved from an environment, clearly, where quantitative easing is moved to quantitative tightening. The path of least resistance was one of risk assets last year. Now it's one of de-risking and volatility management. And most importantly, with regard to bonds, we've actually seen yields move from the near-zero yields across the curve and flat yield curse to an environment whereby the Fed is growing increasingly concerned about the outlook and has responded by being a little bit more hawkish, which ultimately means that yields have risen. In some cases, the front end's risen by more than 200 basis points. So the starting point in the playing field is incredibly important to understand

why investors have pivoted in this environment toward one where bonds may have not been as attractive source of total return in the past, but are now an attractive source of carry and more importantly, a defensive posture for their overall portfolio allocations. Now, Dan, you have, you've written that bonds may be in a new trading rate. in the new newsletter, that rather than responding to the same catalyst that have driven stocks lower for much of the year, bonds are once again acting like shock absorbers. They're doing the opposite. Are you confident that's going to continue?

And why has that changed? Well, I mean, bond yields have, as we know, bond yields have risen, and the bond market has lost 9%. But yields are double now. The ag's yield has doubled since the beginning of the year. investors now are earning that higher yield. And, you know, we're watching the 10-year move. Today it was over three at one point. It was down in the two-nines.

But I feel like we have moved to a new plane. And, yes, every day we'll come into the, you know, you and I'll talk, we'll come in and we'll say, oh, you know what? Yields went up today, yields. But we are at a new, I wouldn't call it a plateau, but it's a whole new plane. And investors are benefiting big time by the. this because they are earning, you know, twice as much yield today as they did at the beginning

of the year. And you were talking about flows. I believe there's quite a lot of flow activity right now as people are taking losses. They're doing tax swaps so that they can book some of these losses. Because think about it, you can, you know, if you're down 9%, you can take a swap on that, you book that loss. Now you're buying something at a higher yield. Why not? Makes some sense. So Todd, You written recently, year today through May 25th, bond mutual funds incurred significant redemptions, $242 billion. In May, bond mutual funds, $90 billion in outflows, but bond ETFs had inflows. So bond mutual funds outflows still in May, but bond ETFs inflows. Does this support the idea that bonds are bottom, or is it just money just keeps going into the ETFs?

So I think it's a trend that's going on where advisors are embracing the ETFs. structure. We've seen advisors move towards mutual funds away from equity strategies into index-based ETFs. We're seeing that trend continue now within fixed income. It's really a trend where we're seeing people, younger investors are more comfortable with the ETF structure than they are, the mutual funds. You're getting some of the benefits of liquidity and tax efficiency through ETFs. And now there's a whole host of these actively managed ETFs. PIMCO has been a leader in that space. There's other firms as well. Fidelity. to your price. But we're really seeing investors have more comfort in the choices they have

within the ETF structure than they ever did beforehand. The liquidity is so much stronger if you want to be able to be more tactical with fixed income ETFs than you could with fixed income mutual funds. I'm just impressed. I'm looking across the board of bond ETF inflows. There's inflows in Muni bonds, MUB, the Vanguard short-term bond fund had inflows, high yield had inflows, short-term treasury. Is that a pretty wide swath of the the market, the treasury market,

the overall bond market, actually? I agree with Todd about the fact that younger investors are accepting ETFs. They understand them. But are they also trading them? Are they trading them too much? I mean, is the bond ETF the new

meme stock, right? It's too easy to trade them. And are they going to make any money doing it? My heavens. This is is what Jack Bogle's old argument was 20 years ago. He was unhappy with it and Vanguard basically ignored his concerns. You really think people are actively trading Bond DTS on a daily basis? Absolutely. I'm sure they are. I mean, yeah, people have tried to guess which way interest rates are going since, you know, the dawn of time.

Yeah. But with, but with, what advisors are doing and can do is they can shorten their duration using Bond ETF. She mentioned the Vanguard short term bond ETF being one of the the more popular ones this year. So you could take your core portfolio, make it less interest rate sensitive than beforehand, and be able to do that, whereas with mutual funds, it's a lot harder to be able to do. You can be strategic, but with a tilt to the portfolio, and then when you get more comfort that the Fed is not going to be raising interest rates, you could be able to rotate back as appropriate. The Vanguard, the Vanguard, the short-term bond ETF has an open-end traditional mutual fund structure fund as well. So it's really, you know, the question is,

do you want to change the duration on your portfolio at 237 in the afternoon? I mean, is it very important to do it at 237? Or do you just do it at the end of the day, right? You trade it at the end of the day, because that's the only difference. The costs are the same. The tax efficiency is the same. At least when you're talking to Vanguard. I would have to point out, Vanguard is a little bit unique in the way that's structured. Essentially, the funds, the ETF and the mutual fund, is just part of the same share. It's a different share class, same fund. That's a unique structure for Vanguard. I think it's a tremendous structure for them. Jerome, let me move on here, because something caught my eye over the weekend. According to the Investment Company Institute,

passive index funds have overtaken active funds for the very first time. This is the ICI's Daniel report, 16% of U.S. market capitalization was controlled by passive funds at the end of 2021, 14% for active funds. This is the first time passive has got a stronger market share than active. You run one of the biggest active bond funds in the U.S. How do you feel about this relentless flow of money into passive funds? Well, you know, it's really driven by two things. One is tax loss harvesting, as we mentioned at the outset. There's a tremendous amount of mutual fund money that is being simply creating tax losses that's rotating out into other fixed income investments that are more generic. Frankly, you're seeing a lot of inflows into government bond funds of

all different types of durations. And so that in of itself is part of that tactical nature. But what's inevitably happened in periods of uncertainty in the past is those initial allocations get redeployed. And the risk of those allocations gets underappreciated, given the uncertain environments that we're in. And we typically see that those active strategies start to bring in and create a magnet effect for new inflows when that uncertainty emerges. And more importantly, as we get later on in the rate hiking cycle that we've typically seen with the Fed. So the maneuverability of active management and fixed income is unequivocal at this point. But the reality is we're having people make a tactical decision at this point to realize tax loss harvesting, and then going

into various strategies which they deem to be more liquid over periods of time. The next step of that is how they choose to manage the more myopic focus of their views of risk. And that's yet to be determined. But we've seen that time and time again over the past four to five decades. We think it's certainly going to happen this time around. I think also though, Bob, we need to contextualize this broad conversation. One where is more tactical, meaning over the next six to 12 months, which is yields have increased in terms of where the relative opportunities are and how to play defense against broader market volatility. And then one, the secular trend or multi-secular trend,

which is we're finding new avenues of people who want to think about fixed income since bonds are different. And that is an inviting base of people who really haven't been focused on, you know, looking away from typical risk assets, including equities, high-yield, emerging markets, that really affords them opportunities and avenues to take advantage of the ETF vehicle, something that has been sort of evolving since the category,

killers like the ultra-short funds more than a decade ago. So this is just the natural evolution of the ETF landscape, which is inviting a new clientele into the marketplace. And we're beginning to see that continue, as we have for the past decade, into the next decade. So the growth is going to be tremendous, especially if we find ourselves in a more higher yield environment, similar to where we are today. And more importantly, we're able to differentiate those risks along the way. There was a, it's certainly true that there's a, there are new elements, new investors coming into the ETF space. That's certainly good news. The problem I have is with this whole active argument. We've been hearing for the dawn, since the dawn of time, wait till things get

really messy, and that's when the active guys are going to outperform. The academic literature indicates it's not true. Now, Dan, you have been a very vociferous defender. No, that's not true. I think it to be very, very clear about the difference between active equity, active equities and active fixed income. Active equities, actually, we would agree with that statement that the active underperforms over periods of time, especially when you calculate fees. But undoubtedly, when you look at the fixed income dynamics, whether it's a mutual fund or ETF, active fixed income does outperform in those environments because of its degree of freedoms and maneuverability to manage interest rate exposure, credit exposure, etc.

All you have to do is look back to the global financial crisis to see that relative outperformance across all different types of bond funds in that context. And that, you know, there's plenty of data that supports that. You can simply go to 2028.com and find much of them. The whole active, passive argument is built on averages. And if you want to buy the average fund manager, then you're in trouble. You're not going to do well. But if you do your homework, you do your research, you find the really good active managers,

whether it's in bond funds, whether it's in stock funds. You can't outperform. They do outperform. I mean, Bob, you've been reading my newsletter for over 20 years. You've seen what happens, all right? You've gone. Well, you have been a very vociferous defender of Vanguard's active management in that period. Indeed, so was Jack Bogle, who said time after time, the average person is better off in a passive index fund, time after time, and then was instrumental in creating active bond.

And equity ETFs, he created prime cap, he created Wellington. He never had a problem with the idea, but he insisted that the average person is better off in a passive. Well, his largest holding for years and years was Windsor Fund. It was John Neff's fun. It wasn't the 500 index fund. So, you know, Jack Bogle, who, you know, I had many conversations with, he sort of, he could talk the game out of both sides of his mouth. then what happened, Vanguard grew to be as big as it is because, you know, if you bought the active, you went that way. If you bought passive, you went that way. So you're certain,

Jerome is insisting on active bond management can outperform during periods of high volatility. Where do you come down on all of this? So what we've seen is that active managers can add some value by taking on credit risk relative to the broader marketplace, and advisors are embracing that. So at VETI, we've done some surveys and done webcasts that talk to advisors to be able to understand it. And what they're telling us is they want an active strategy that can help navigate this environment that we're in, where it's rising interest rates, whether they're worried about credit spreads. They're visiting our VETify website and being able to learn more about these tools. And they're embracing these active strategies from PIMCO, among

others. They're really punching above their weight this year. We're running a tactical, high-yield portfolio advisor investments with a couple of different sleeves. And it's a very interesting way to approach the high-yield market because obviously the spreads change so quickly. And we were talking about that Vanguard, that's the one area that Vanguard does not have an index-based approach within the ETF structure. They've got actively managed mutual funds within high-yield. But we're seeing advisors embracing high-yield again.

You showed earlier. where HYG was one of the more popular funds in the data that we have at VETIF, and we're seeing that investors are embracing these fixed income ETFs and comfortable taking on a more active approach using these products. So what happens now if we continue to see days like today? We're over 3% on the 10-year at this point. Will there still be, will this still result in bond outflows, fund outflows if this continues? So from an ETF perspective, we're going to see,

we think we're going to continue to see investors embrace the structure. From a mutual fund standpoint, I think if you've got losses that are around 9% in the ag, the average bond mutual fund, you're going to likely look to take that tax loss harvesting that Dan was talking about earlier and be able to benefit from a lower cost, more liquid alternative that you can find through the ETF structure. Jerome, now you have said before 25%, you think, of fixed income flows will likely go to active strategies this year. You're talking about four to five trillion going into bond ETS over the next eight to ten years, so 25 percent is a pretty good number. Yeah, and I think it goes with

the evolution and education of the value of the bond ETF and the bond landscape. Remember, you know, here at PEMCO, we're really vehicle agnostic in many ways. What we're looking for is to try to find ways to differentiate and accentuate risk parameters, which effectively bring total return to clients, and that is active management. So what we're ultimately saying here is that over the next few years, the new people, the new advisors, the new clientele who are utilizing the fixed income approach via the active ETFs are going to quickly see the differentiation that comes from being in a passive versus being in an active. That takes time. So first point, there is tremendous growth. There's $4 to $5 trillion over the next eight to 10 years that will find its way into that fixed income ETF landscape.

And we think a substantive portion of that will ultimately find its way into the active landscape as folks look for differentiation to outperform an economic cycle. Dan, I want to let me just throw out to the group as a whole. Maybe, Jerome, you can comment on this. I've heard it said often there's no Fed put in equities anymore, that there is, or maybe if there is, it's very, very low. But the Fed's not going to come to the rescue of the stock market if it's down significantly. But I've heard people say there is a Fed put in the bond market, that the Fed cannot allow the bond market to fall apart, yields to go too high, because the funding costs to the U.S. government will be so astronomical. You see different numbers of the cost. If it's 5%, 10-year, 6%, whatever, but whatever, the federal government will be very uncomfortable with yields, you know, in the mid-single digits and the high single digits at this point.

Is there such a thing as a Fed? I don't know if there's a Fed put on bonds, but if you think about 2008, I mean, what was going on in the bond market and the liquidity problems, nobody wants to see that happen again. I mean, the bond market locked up, the cash market locked up. So, you know, is there a Fed put? I think they're very concerned. Look, what are the issues today? inflation, recession, COVID. I mean, it hasn't changed.

It's been going on since the beginning of the year. And that's what the Fed is going to be looking at. I think what we're seeing is advisors are reading their tea leaves from the Fed, being able to give an indication as to whether or not they're more comfortable being hawkish or dovish. And it's something that we're seeing when we talk to advisors at VETI. They're watching what's going on from the Fed and week to week month to month. they're shifting their exposure and their comfort from taking on interest rate sensitivity or not based on whether or not the Fed is going to take more aggressive action.

So, Jerome, is there a Fed put in bonds? Is there a reason why the Fed should be uncomfortable if yields really start moving up for funding purposes for the U.S. deficit? Well, I think what we need to be clear here is the initial discussion of liquidity of markets. And the Fed clearly has cut off the tails of the liquidity markets in regard to making sure that fundamental liquidity is available in the repo market and more importantly, trying to create mechanisms to make sure primary dealers are going to still be incentivized to take down primary issuance. So that's been the real focal point of the Fed, really, and it's been highlighted since 2018, 2020, and even more recently. The Fed is very involved in terms of how the market will conduct itself and make sure there's ample liquidity to do so. However, what you're suggesting, though, is that the Federal Reserve will act in conjunction with the Treasury Department being concerned about overall debt financing as a percentage of GDP, perhaps. And that seems unlikely. Their job is to be two, perhaps three mandates, growth, inflation, and maybe financial conditions, if you want to throw the third one in there unofficially.

But the point is, is the only way they get to that mid-single-digit of rates that you're suggesting is if one of those becomes vastly unhinged, much beyond expectations. And that I would suggest would probably be inflation of anything, although that's a low probability event from where we sit right here. So the real concern in the pivot, the inertia that we're seeing with a pivot right now, really has to do with the context of financial conditions moving from easy to tighter and naturally right now in a historical basis is sort of at the median. And so there's a long way for the Fed actually to continue, quote, tightening,

and that's probably going to have more of an effect on the equity market, creating more uncertainty in terms of risk assets, which pivots people more into the fixed income markets. So right now, advisors, risk takers, practitioners are really focused on, if you will, the economics and the cycle as it relates to risk assets and not necessarily bond yields. Yeah. I think that you've made an important distinction between those. the Fed and the Treasury Department and what their various interests are. However, in the back of the

Fed's mind, I'm sure that that issue does live there, even if it's not officially part of the mandate here. Now it's time to round out the conversation with some analysis and perspective to help you better understand ETS. This is the Market's 102 portion of a podcast. Today we'll be continuing the conversation with Dan Weiner from Investors and also the editor of a terrific newsletter for Vanguard investors. I've been reading for many years. Dan, I want to get your general take on the market, but you had a very interesting point in the newsletter

about what you call the negative 3.5% solution, and that is it is a rare day when the S&P is down 3.5%. And this happened three times this year. Those are remarkable swings. On average, the S&P swung, I don't know how many years, average of about 0.7% a day. Correct, right. This year it's swung 1.2%.

on an average on a daily basis, which is a remarkable difference. And there have been three days where it swung three and a half percent. And your point here is on the rare days where this has happened. And I think we have, what? 25, 30 that we've counted over the years. Yeah. Yeah. So your point is in the year after when this tends to happen,

the returns are invariably, almost invariably higher. If you're an investor and you see a day, when the market goes down three and a half percent, you should buy. Because more often than not, you not only make money, you make a lot of money. I think the average return over that 12-month period was over 20 percent. You know, it's one of those great buy, low, sell high rules. Look for a day when the market's down three and a half percent. Now somebody's going to call you up and say, oh yeah, but maybe I don't see it until after it's already happened. Well, Jeff DeMaso, my director of research,

took a look at what happened if you bought the day after the 3.5% decline, you still made a lot of money, still big returns. So you don't have to worry about that, but you have to be an investor, not a trader. You have to get in there and say, this is a unique day. This is something we don't see too often. Three and a half percent decline in the market.

I'm going to buy. Yeah. Well, it does make sense because on those days, volatility tends to pop up. You get, you know, what's the long-term average on the VIX 20? It goes up. One standard deviation might be 28. Another might be, I think, 36, 37. So you get a two standard deviation day.

Usually when you're down 3.5%. The VIX is between 35 and 40. So you're already two standard deviations away. And we've done a lot of looking at the swings. You were talking about it earlier. swings in the market. You know, I'm sure anybody who spends any time watching it, this has watched it this year, you know, the day opens, the market's up three, 400 points on the Dow, you know, a few minutes later. It's, well, like now, it's up 14, right? And sometimes

it's down 20 or down 200. The intraday range has just been enormous. Yeah. So just to put the context here, and this is, from Dan's newsletter, between June 83 and March 22, the S&P fell three and a half percent or more on 65 separate days. 65. Yeah. And the average return one year later for those 65 days was 25 percent higher. The S&P was 25 percent higher on average on those 65 days.

It was down three and a half percent or more. And it was positive 55 out of 65 times. Right. So. I mean, you don't get the. these days that often, but when they come along, you know, you should be ringing the opportunity bell, right? This is an opportunity. You should go for it. You often had several growth funds in your recommended portfolios. Yep. And it's been a tough year for them. Is your

advice still to hang on? What are you telling me with the program? Well, you know, we don't buy, I've never been a believer in buying funds. I'm a believer in buying funds. I'm a believer in buying. managers. And the managers that we have, that I've been recommending for years are, you know, they're going to do just fine. I mean, they are going to have years when they don't do well, years when they do well. But, you know, Don Kilbride, who runs Vanguard's dividend growth fund, the prime cap team that run the capital opportunity and the various odyssey aggressive, you know, prime cap odyssey funds. I mean, These guys are professionals.

They've been doing this for a very long time. I have a lot of confidence that they know how to maneuver in these various markets. But you don't take a state on the growth versus value. I mean, for years, you've recommended capital opportunity. Capital opportunity is a big growth fund. International growth, another one, with a growth. Well, I mean, capital opportunity, you say is a big growth fund, but actually the strategy of the managers there is what I call growth at a real growth.

reasonable price or GARP. You know, they are buying growth companies. If you just look at the portfolio, you'd say, yeah, these are growth companies. But what did they pay for them? When did they buy them? They bought them when they didn't look like growth companies. They bought them when they weren't doing well, when they thought that there might be a catalyst, something coming down the road that would spur their price, their earnings, what have you.

So I don't buy that capital opportunity is just a quote-unquote growth fund. By the same token, Vanguard's dividend growth fund, which is most people would say is a value fund. I mean, one of his biggest positions a while back was Microsoft. I don't think anybody would have thought that Microsoft was a value stock per se. Yeah. You don't really talk much about small-cap funds at all. And, you know, despite academic evidence that over long periods of time, small cap outperforms and value outperforms. And small cap value does better than everybody.

But the problem is, you never talk about that. Well, the problem is that Vanguard doesn't have any good small cap funds. I mean, they have index funds, but their small cap funds have really been lousy. You mean to actively manage? The actively managed ones. And, yeah, we could add some ETFs or ETFs. index funds into the mix. I mean, right now, I think people, I'm very happy owning a big slug of dividend growth

because Kilbride is buying companies where they have battleship balance sheets, where he is able to talk to the management and get a sense of what they're planning to do in terms of raising dividends over time. It's not a yield fund, it's a growth fund. But, you know, it's a dividend growth fund. Yeah. So your message, and this was right. in the newsletter. I'm literally reading from it. Stick with it. You won't be disappointed.

It's basically the message. No. I mean, you and I've been in this business a long time, and I dare say that sticking with it has been very profitable for both of us. It's the hardest thing to do. It's my 32nd year at CNBC covering financial issues. 25 years is the stocks correspondent. And the hardest single thing is to tell people, if you are thinking long-term, one year is not going to make a difference. And even if this is a down-year, and it looks like it's a down-year, it's not going to make a difference long-term. But that's very hard.

One year's a rounding error. One year's a rounding error. You know, if you're an – I say you're either a trader or an investor. If you're an investor, you have to take a long-term view. You look for great managers, which we do. The Bailey Gifford team, the prime cap team, Don Kilbride at Wellington Management. these are excellent. But what do you do, and I don't want to belabor this point,

but what do you do when you get a multiple compression like we're seeing here? It doesn't matter whether Bailey Giffords. And I agree. Bailey Giffrit's great. They're a big manager in the Vanguard International funds. But I don't have any dispute with you at all on that. But what happens when there's just a general multiple compression that we're seeing? When you have a multiple compression, what you're hoping is that the managers are looking around and saying,

gee, is there something better to put in the portfolio than what we have now? You know, are we able to, look, multiples are going to go up, multiples are going to go down. But the bottom line is, are these companies building products, providing services, you know, are they number one in their class? Are they leaders in their industries? If they are, you're going to do just fine. Yeah, I would agree with that. It's just tough to get people to understand. the difference between multiple compression that we're seeing, dramatic earnings decline,

which we are not seeing in most of the really big, high quality, high quality in general, is not seeing dramatic earnings. Well, investors have, and traders have become enamored of things that move fast and, you know, give you a gain tomorrow, right? They don't take a long view. And I just think it's real important to say, I'm an investor. I take a long view. I'm not trying to, you know, I mean, look at all the people in the cryptos who thought they were on the next rocket ship.

And the cryptos have just fallen out of bed. I mean, I got a call recent, not too long ago from someone who said, I'm buying Bitcoin at $40,000. I said, why? It's a speculation. What's the point? You know, and of course, now it's what? at 30, that's not investing. That's speculation.

And unfortunately, the noise around crypto, you know, Scott Minard with his call for $400,000, $600,000, and then at Davos, he said, no, $8,000. This is Scott minored at Guggenheim. Yeah. Yeah. Yeah. Yeah. It's a long, it's a different story getting into crypto and blockchain.

I'm a big backer of blockchain, D5, smart contracts. I'm with you on Bitcoin. I'm completely neutral on it. There's no way you're going to value it, so I have no opinion. I don't predict it. I'm very big on the technology. The blockchain technology, I'm with you. The blockchain technology is remarkable,

and it has its uses. But, you know, how many cryptocurrencies are there now? Everybody in their brother can start a cryptocurrency. Yeah, it's a tough one. It's a story for another day and a discussion for another day. But Dan, I'm going to have to leave it there. Dan Wiener is the editor of the independent advisor for Vanguard Investments

and the chairman of advisor investments. Dan, thank you for joining us. And thank you, everyone, for listening to the ETF Edge podcast. Inves QQQQ believes new innovations create new opportunities. Become an agent of innovation. Invesco QQQQ, Invesco Distributors, Inc.