The Invesco Indexing Investable (III) universe is global in scale — comprising securities issued in both developed and emerging markets. We use a fully transparent, systematic approach to securities selection to produce a comprehensive set of equity and fixed income securities eligible for Invesco indexes.
The III Equity Universe is updated four times per year, including an annual reconstitution which resets the overall global equity universe. Quarterly rebalancing helps ensure that holdings remain relevant to the index universe, with the most illiquid securities being eliminated. As part of the reconstitution process, markets are analyzed annually — a rigorous process that considers a country’s inflation, national income, sovereign debt rating, openness to foreign investment, and equity market maturity.
The III Bond Universe is updated monthly. Monthly updates account for the bond market’s more dynamic nature, reflected in frequent new issuances and changes to bond features. The monthly updates ensure the universe remains relevant by including any new securities that meet the universe eligibility criteria while eliminating those that fall outside of these requirements.
The III Equity Universe captures the investable segment of the global equity market. Publicly listed equity securities and securities that exhibit equity-like characteristics are eligible for inclusion. We carefully consider the liquidity of universe constituents — including company size, trading activity and any limitation to ownership that reduces security free float.
The III Bond Universe captures a broad and diverse opportunity set of the global bond market. Eligible securities are selected if they meet a number of strict requirements including coupon type, credit rating, and maturity. These criteria seek to ensure that the universe properly encompasses the broad and diverse global bond market.
Both universes are designed with an eye toward customization in index design. Inclusion criteria for equity and fixed income securities are chosen to assist in delivering highly customizable solutions across both developed and emerging markets.