Invesco High Yield Systematic Bond ETF

Invesco High Yield Systematic Bond ETF (GTOQ) is an actively managed fund that holds below-investment-grade, or "junk," bonds. A rules-based factor model picks the bonds; the fund doesn't track an index. Its 0.39% expense ratio is near the 0.42% peer average but well above index funds such as HYLB and SPHY at 0.05%. It pays monthly, with a trailing 12-month yield of 7.2% as of October 27, 2026.

• Over the year to Oct 27, 2026, GTOQ returned +1.5%, 6th of 8 among similar funds.
• Its 5-year annualized return was +3.5%.
• Its worst full calendar year was 2022 (-12.2%); its best was 2023 (+14.2%).
• The deepest fall in its price history was 16% (Sep 20, 2021 to Sep 30, 2022), recovered by Dec 27, 2023.

As of Jul 31, 2026, the fund held 467 securities; the ten largest made up 5.97% of assets, and 23.89% sat in cash and money-market holdings.

The bonds mature in 4.6 years on average (weighted by size), with an average coupon of 6.65%.

• Over the three months to Jul 31, 2026, investors added a net $19.2M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.76%, +0.35%, -0.19%.

GTOQ is actively managed and doesn't follow an index. Under normal conditions it puts at least 80% of net assets in high-yield bonds. These are bonds rated below BBB- by S&P or below Baa3 by Moody's, or derivatives that behave like them. The sub-adviser, Invesco Advisers, Inc., uses a factor-based system. It looks for measurable traits it believes earn more over market cycles: "value" bonds that pay extra yield compared with similar-quality bonds, low-volatility bonds, and "high carry" bonds with higher yields. Bonds that lose those traits are usually sold, which helps explain the fund's 70% portfolio turnover.

The managers use derivatives to offset side effects of those tilts, such as interest-rate sensitivity (duration) and sector concentration. Tools include interest-rate swaps, Treasury futures and credit default swaps, which work like insurance on a borrower's debt. As of July 31, 2026, the fund held Treasury futures and credit derivatives with Goldman Sachs International and JPMorgan Chase Bank.

The fund may also hold up to 20% in Treasury and agency securities, up to 10% in collateralized loan obligations (CLOs) and bank loans, and up to 10% in bonds not priced in US dollars. It can own distressed or defaulted bonds. It can also own Rule 144A securities, privately placed bonds that can be harder to sell when markets are under strain.

• GTOQ charges 0.39% a year, versus an average of 0.42% for the similar funds below (5th of 8, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $40 in the first year and $493 over 10 years (assuming a 5% annual return).

It holds junk bonds and pays monthly, with a 7.2% trailing yield as of October 27, 2026, but it carries more credit risk than core bond funds.

GTOQ could add monthly income. Its trailing 12-month yield was 7.2%, or $1.55 per share, as of October 27, 2026. That income comes with credit risk. The fund launched in December 2020, so it has no record from 2008 or the 2020 crash. In the 2022 bear market, its price fell 15.7%. Its official 2022 return of -11.86% is its worst calendar year. Its deepest drop, 16% from September 2021 to September 2022, took about 15 months to recover. Anyone drawing income in a year like that would have sold shares at low prices.

The fund costs 0.39% a year. In the SEC's standard example, that's $40 in the first year and $493 over 10 years on $10,000. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.

Matched by bond funds with the closest average maturity and issuer mix (N-PORT).