Invesco’s ETF Business Shines as 2Q Flows Jump 9%

Invesco’s ETF Business Shines as 2Q Flows Jump 9%

QQQ, QQQM pull in assets with RSP, as other parts of Invesco’s business flagged.

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Reviewed by: Lisa Barr
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Edited by: Ron Day

Invesco, the fourth-biggest U.S. ETF issuer, said second-quarter net inflows to its exchange-traded funds business jumped 9% to $5.7 billion as new money poured into its big Nasdaq funds. 

The Invesco NASDAQ 100 ETF (QQQM), a less expensive version of Invesco’s biggest fund, the $209 billion Invesco QQQ Trust (QQQ), brought in $3.2 billion during the quarter, jumping from the first-quarter total of $1.9 billion. At the same time, QQQ brought in $1.4 billion, a reversal of the $2.1 billion in outflows during the first quarter. 

“The largest driver of growth in the quarter was our global ETF business,” CEO Andrew Schlossberg said on the company’s earnings call. Invesco’s ETF have had net inflows in 11 of the past 12 quarters. 

Investors poured money into Nasdaq funds, which had their best first half this year since 1983. Other stock funds gained assets, with the Invesco S&P 500 Equal Weight ETF (RSP) pulling in $2.6 billion. 

Invesco’s mutual fund business trailed the ETF unit, reflecting a migration of investor cash into the exchange-traded fund format from the older mutual fund category. Mutual funds and ETFs lumped together recorded $8.4 billion in net outflows, excluding money market funds, accelerating from the more than $2.5 billion in outflows in the first quarter, and still less than the $11.3 billion this time last year.  

Invesco Closes 26 ETFs

Money market funds saw $15.4 billion in inflows, tracking the overall trend, as U.S. money market funds have received inflows totaling about $600 billion in the first half of the year, according to Morningstar

Invesco’s total assets under management were $1.5 trillion, in line with the consensus of analysts surveyed by Bloomberg, and up from $1.4 trillion this time last year. 

ETF growth followed Invesco’s first-quarter adjustment to its ETF lineup, when it closed 26 ETFs, more than 10% of its total lineup. It currently has 217 ETFs with an aggregate $418 billion in assets under management. 

Invesco shares fell after the company reported its 31 cents in earnings per share was less than the 39 cents expected by analysts surveyed by Bloomberg. Adjusted revenue also came in slightly below expectations, at $1.09 billion compared to the $1.1 billion consensus estimate.  

Invesco’s shares are down more than 7% in afternoon trading.  

 

Contact Gabe Alpert at [email protected]         

Gabe Alpert is a former data reporter at etf.com with over seven years’ experience in financial journalism. He also previously contributed reporting and analysis to Barron’s Magazine, Investopedia and other publications.