Invesco Bloomberg Enhanced Fallen Angels ETF

Invesco Bloomberg Enhanced Fallen Angels ETF (IFLN) holds "fallen angels." These are corporate bonds that were once rated investment grade and were later cut to high-yield, or "junk," status. It tracks the Bloomberg U.S. High Yield Enhanced Fallen Angels Index, which gives the most weight to bonds downgraded within the last 12 months. The fund charges 0.23% a year and pays monthly, with a trailing yield of 6.27% as of October 27, 2026.

• Over the year to Oct 27, 2026, IFLN returned -1.1%.
• Its 5-year annualized return was +2.9% and its 10-year +3.8%.
• In the 2020 COVID crash it fell 21.5% and regained its old high 4.5 months after the low.
• Its worst full calendar year was 2008 (-30.1%); its best was 2009 (+23.6%).
• The deepest fall in its price history was 44.8% (Dec 11, 2007 to Oct 10, 2008), recovered by Dec 29, 2011.

As of Aug 31, 2026, the fund held 114 securities; the ten largest made up 24.3% of assets, and 27.49% sat in cash and money-market holdings.

The bonds mature in 9.2 years on average (weighted by size), with an average coupon of 5.4%.

• Over the three months to Aug 31, 2026, investors withdrew a net $16.4M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.43%, -0.60%, +0.93%.

The fund tracks the Bloomberg U.S. High Yield Enhanced Fallen Angels Index, which Bloomberg Index Services Limited builds and maintains. The fund generally invests at least 80% of its total assets in the index's bonds. To qualify, a bond must be a fixed-rate corporate bond in U.S. dollars from a company based in a developed-market country. It needs at least $300 million outstanding and at least one year left before it matures. It must once have been rated investment grade and now sit in the upper tiers of high yield, from BB+ down to B+ (Ba1 to B1 at Moody's). The index provider bases this on ratings from Moody's, S&P and Fitch. Privately placed Rule 144A bonds can qualify.

The "enhanced" part is the weighting. Bonds downgraded within the last 12 months get the highest weights, and bonds downgraded 24 or more months ago get the lowest. This tilts the fund toward the newest fallen angels. Any issuer weighing 4.75% or more counts toward a 24% combined cap, and the excess is spread across other issuers.

The fund uses sampling, which means it holds a representative selection of the index's bonds rather than every one. It held 116 positions as of August 31, 2026, and portfolio turnover was 47% in the latest prospectus year. The fund concentrates in an industry only when the index does. As of December 31, 2025, the index had significant exposure to industrials.

• IFLN charges 0.23% a year.
• Using the prospectus's standard example, $10,000 invested would cost about $24 in the first year and $294 over 10 years (assuming a 5% annual return).

IFLN pays monthly from a portfolio of junk-rated corporate bonds, so its main draw is a yield above that of investment-grade bonds, with more credit risk.

IFLN could add a monthly income stream to the bond side of a portfolio. Its trailing 12-month yield was 6.27% as of October 27, 2026. It costs 0.23% a year, or about $24 in the first year on $10,000 under the SEC's standard example. That income comes with real credit risk. The fund fell 21.5% in the 2020 COVID crash and took about 4.5 months to recover. In 2022 it dropped 13.4% and needed about 14.5 months to recover. Its worst calendar year was 2008, with a 30.1% loss. Its deepest drop, 44.8% from December 2007 to October 2008, took about 38.6 months to recover. Anyone who needs to sell shares or draw income during a stretch like that may lock in losses. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.

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