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PowerShares VRDO Tax-Free Weekly Portfolio passes USD1bn in AUM


Invesco PowerShares, a provider of exchange-traded funds, says the PowerShares VRDO Tax-Free Weekly Portfolio has surpassed USD1bn in assets under management.

Launched in November 2007, the PowerShares VRDO Tax-Free Weekly Portfolio was the first ETF to provide investors access to the variable rate demand obligation market. VRDOs are floating-rate municipal bonds that offer investors tax-exempt income in a short-term time frame.

Historically, the VRDO market has generally been accessible only by institutional investors. Large trading denominations (generally starting at USD100,000) created a barrier between VRDOs and the average investor. Invesco PowerShares took strides to eliminate that barrier by launching PVI.

“Invesco PowerShares has strived to provide investors access to markets that have traditionally been difficult to invest in, and we are very pleased with the success of PVI,” says Bruce Bond, president and chief executive of Invesco PowerShares. “The PowerShares VRDO Tax-Free Weekly Portfolio epitomizes our commitment to providing innovative investment products that feature the tax efficiency, transparency, and liquidity benefits inherent to the ETF structure.”

The portfolio is based on the Thomson Municipal Market Data VRDO Index. The fund will normally invest at least 90 per cent of its total assets in securities that comprise the index. The index is designed to track the performance of a pool of tax-exempt VRDOs issued by municipalities in the US on which the yields generally reset on a weekly basis.

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