Invesco Indexing Consultation on Proposed Change to the Free Float Eligibility Requirements of the Invesco Indexing Investable Equity Universe

Invesco Indexing is initiating a consultation regarding a potential change to the free float eligibility requirements of the Invesco Indexing Investable (III) Equity Universe. Currently, for an equity security to be newly eligible for the III Equity Universe, at least 20% of its shares outstanding must qualify as free float (see the III Equity Universe: Liquidity section of the III Universe Methodology for details). For an existing constituent of the III Equity Universe to remain eligible, at least 15% of its shares outstanding must qualify as free float.

Invesco Indexing is proposing supplementary free float eligibility criteria that would be applied after the constituents of the III Equity Universe are determined through the application of the complete, existing III Equity Universe methodology. Specifically, if a security meets both of the following criteria, in addition to all other eligibility criteria, it would be added to the list of III Equity Universe constituents:

1. The company’s market capitalization is greater than or equal to twice the company market capitalization of the smallest security that newly qualified for the Mid Cap size segment as of the most recent June rebalance.
2. The security’s float-adjusted market capitalization is greater than or equal to the company market capitalization of the smallest security that newly qualified for the Mid Cap size segment as of the most recent June rebalance.

The supplementary liquidity criteria would be applied during each quarterly rebalance (March, September, December) as well as the annual reconstitution (June) of the III Equity Universe.We invite interested stakeholders to tell us whether they would like to adopt the change as proposed or keep the current free float eligibility criteria by contacting us at IndexSupport@Invesco.com. The deadline to respond to this consultation is April 25, 2022.