| Summary Prospectus |
April 28, 2023 |
Invesco Small Cap Equity Fund
Class: A (SMEAX), C (SMECX), R (SMERX), Y (SMEYX), R5 (SMEIX), R6 (SMEFX)
Before you invest, you may want to
review the Fund’s prospectus, which contains more information about the Fund and its risks. You can find the Fund’s prospectus, reports to shareholders, and other
information about the Fund online at www.invesco.com/prospectus. You can also get this information at no cost by calling (800) 959-4246 or by sending an e-mail request to
ProspectusRequest@invesco.com. The Fund’s prospectus and statement of additional information, both dated April 28, 2023 (as each may be amended or supplemented), are
incorporated by reference into this Summary Prospectus and may be obtained, free of charge, at the website, phone number or e-mail address noted above.
Investment Objective(s)
The
Fund’s investment objective is long-term growth of capital.
Fees and Expenses of
the Fund
This table describes the fees and expenses that you may pay if you buy, hold and sell shares of the Fund.
The table and Examples below do not reflect any transaction
fees that may be charged by financial intermediaries or
commissions that a shareholder may be required to pay directly
to its financial intermediary when buying or selling Class Y or
Class R6 shares. You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least
$50,000 in the Invesco Funds. More
information about these and other discounts is available from your financial professional and in the section “Shareholder Account Information – Initial Sales Charges (Class A Shares Only)” on page A-3 of the prospectus and the
section “Purchase, Redemption and Pricing of Shares – Purchase and Redemption of Shares” on page L-1 of the statement of additional information (SAI).
Shareholder Fees (fees paid directly from your investment)
| Class: |
A |
C |
R |
Y |
R5 |
R6 |
| Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) |
5.50% |
None |
None |
None |
None |
None |
| | ||||||
| Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) |
None1 |
1.00% |
None |
None |
None |
None |
| | ||||||
Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment)
| Class: |
A |
C |
R |
Y |
R5 |
R6 |
| Management Fees |
0.73% |
0.73% |
0.73% |
0.73% |
0.73% |
0.73% |
| | ||||||
| Distribution and/or Service (12b-1) Fees |
0.25 |
1.00 |
0.50 |
None |
None |
None |
| | ||||||
| Other Expenses |
0.28 |
0.28 |
0.28 |
0.28 |
0.14 |
0.07 |
| | ||||||
| Total Annual Fund Operating Expenses |
1.26 |
2.01 |
1.51 |
1.01 |
0.87 |
0.80 |
| | ||||||
1
A contingent deferred sales charge may apply in some cases. See “Shareholder Account
Information-Contingent Deferred Sales Charges (CDSCs).”
Example.
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing
in other mutual funds.
The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. This Example does not include
commissions and/or other forms of
compensation that investors may pay on transactions in Class Y and Class R6 shares. The Example also assumes that your
investment has a 5% return each year and that the Fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions, your costs would be:
| |
1 Year |
3 Years |
5 Years |
10 Years |
| Class A |
$671 |
$928 |
$1,204 |
$1,989 |
| | ||||
| Class C |
$304 |
$630 |
$1,083 |
$2,144 |
| | ||||
| Class R |
$154 |
$477 |
$824 |
$1,802 |
| | ||||
| Class Y |
$103 |
$322 |
$558 |
$1,236 |
| | ||||
| Class R5 |
$89 |
$278 |
$482 |
$1,073 |
| | ||||
| Class R6 |
$82 |
$255 |
$444 |
$990 |
| | ||||
You would pay the following expenses if you did not redeem your shares:
| |
1 Year |
3 Years |
5 Years |
10 Years |
| Class A |
$671 |
$928 |
$1,204 |
$1,989 |
| | ||||
| Class C |
$204 |
$630 |
$1,083 |
$2,144 |
| | ||||
| Class R |
$154 |
$477 |
$824 |
$1,802 |
| | ||||
| Class Y |
$103 |
$322 |
$558 |
$1,236 |
| | ||||
| Class R5 |
$89 |
$278 |
$482 |
$1,073 |
| | ||||
| Class R6 |
$82 |
$255 |
$444 |
$990 |
| | ||||
Portfolio Turnover. The Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover
rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund’s
performance. During the most recent fiscal year, the Fund’s portfolio turnover rate was 33% of the average value of its portfolio.
Principal Investment Strategies of the Fund
The Fund invests, under normal circumstances, at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of small-capitalization issuers. The principal
type of equity securities in which the Fund invests is common stock.
The Fund considers an issuer to be a small-capitalization issuer if it has a market capitalization, at
the time of purchase, no larger than the market capitalization of the largest capitalized issuer included in the Russell 2000® Index during the most recent 11-month period (based on month-end data)
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plus the most recent data during the current month. An issuer’s “market capitalization” is the value
of its outstanding stock.
The Fund may invest up to 15% of its net assets in real estate investment trusts (REITs).
The Fund may also invest up to 25% of its net assets in foreign securities.
In selecting investments, the portfolio managers utilize a disciplined portfolio construction process that is informed by the composition of the Russell 2000® Index, which the portfolio managers believe represents the small cap core asset class. The Fund uses this index as a guide in structuring the portfolio, but the Fund is not an
index fund. The security selection process is based on a three-step process that includes fundamental,
valuation and timeliness analysis.
◾
Fundamental analysis involves building a series of financial models, as well as conducting in-depth interviews with management. The goal is to find high quality, fundamentally sound issuers
operating in an attractive industry.
◾
Valuation analysis focuses on identifying attractively valued securities given their growth potential over a one- to two-year horizon.
◾
Timeliness analysis is used to help identify the “timeliness” of a purchase. In this step, relative price strength, trading volume characteristics, and trend analysis are reviewed for
signs of deterioration. If a security shows signs of deterioration, it will not be considered as a
candidate for the portfolio.
The portfolio managers consider selling a security if the investment thesis for owning the security is
no longer valid, the stock reaches its price target or timeliness factors indicate that the risk/return characteristics of the stock as viewed in the market are no longer attractive.
Principal Risks of Investing in the Fund
As with any mutual fund investment, loss of money is a risk of investing. An investment in the Fund is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. The risks associated with an investment in the Fund can increase during times of significant market volatility. The
principal risks of investing in the Fund are:
Market Risk. The market values of the Fund’s investments, and therefore the value of the Fund’s shares, will go up and
down, sometimes rapidly or unpredictably. Market risk may affect a single issuer, industry or section of
the economy, or it may affect the market as a whole. The value of the Fund’s investments may go up or down due to general market conditions that are not specifically related to the particular issuer, such as real or perceived adverse economic
conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health
issues, war, military conflict, acts of terrorism, economic crisis or adverse investor sentiment generally. During a general downturn in the financial markets, multiple asset classes may decline in value. When markets perform well,
there can be no assurance that specific investments held by the Fund will rise in value.
Investing in Stocks
Risk. The value of the Fund’s portfolio may be affected by changes in the stock markets. Stock markets may experience significant short-term volatility and may fall or
rise sharply at times. Adverse events in any part of the equity or fixed-income markets may have unexpected
negative effects on other market segments. Different stock markets may behave differently from each other and U.S. stock markets may move in the opposite direction from one or more foreign stock markets.
The prices of individual stocks generally do not all move in the same direction at
the same time. However, individual stock prices tend to go up and down more dramatically than those of certain other types of investments, such as bonds. A variety of factors can negatively affect the price of a particular company’s stock.
These factors may include, but are not limited to: poor earnings reports, a loss of customers, litigation against the company, general unfavorable performance of the company’s sector or
industry, or changes in government regulations affecting the company or its industry. To the extent that securities of a particular type are emphasized (for example foreign stocks, stocks of
small- or mid-cap companies, growth or value stocks, or stocks of companies in a particular industry), fund share values may fluctuate more in response to events affecting the market for those types of securities.
Small- and Mid-Capitalization Companies Risk. Investing in securities of
small- and mid-capitalization companies involves greater risk than customarily is associated with investing in larger, more established companies. Stocks of small- and mid-capitalization companies tend to be more vulnerable to changing market conditions,
may have little or no operating history or track record of success, and may have more limited product lines
and markets, less experienced management and fewer financial resources than larger companies. These companies’ securities may be more volatile and less liquid than those of more established companies. They may be more sensitive to changes in a
company’s earnings expectations and may experience more abrupt and erratic price movements. Smaller
companies’ securities often trade in lower volumes and in many instances, are traded over-the-counter or on a regional securities exchange, where the frequency and volume of trading is substantially less than is typical for securities of larger companies
traded on national securities exchanges. Therefore, the securities of smaller companies may be subject to
wider price fluctuations and it might be harder for the Fund to dispose of its holdings at an acceptable price when it wants to sell them. Since small- and mid-cap companies typically reinvest a high proportion of their earnings in their business, they may not pay
dividends for some time, particularly if they are newer companies. It may take a substantial period of time to realize a gain on an investment in a small- or mid-cap company, if any gain is realized at all.
Foreign Securities Risk. The Fund's foreign investments may be adversely affected by political and social instability, changes in economic or taxation policies, difficulty in
enforcing obligations, decreased liquidity or increased volatility. Foreign investments also involve the risk of the possible seizure, nationalization or expropriation of the issuer or foreign deposits (in which the Fund could lose its entire
investments in a certain market) and the possible adoption of foreign governmental restrictions such as exchange controls. Foreign companies generally may be subject to less stringent regulations than U.S. companies, including
financial reporting requirements and auditing and accounting controls, and may therefore be more
susceptible to fraud or corruption. There may be less public information available about foreign companies
than U.S. companies, making it difficult to evaluate those foreign companies. Unless the Fund has hedged its
foreign currency exposure, foreign securities risk also involves the risk of negative foreign currency rate
fluctuations, which may cause the value of securities denominated in such foreign currency (or other instruments through which the Fund has exposure to foreign currencies) to decline in value. Currency exchange rates may fluctuate
significantly over short periods of time. Currency hedging strategies, if used, are not always
successful.
REIT Risk/Real Estate
Risk. Investments in real estate related instruments may be adversely affected by economic, legal, cultural, environmental or technological factors that affect
property values, rents or occupancies. Shares of real estate related companies, which tend to be small- and
mid-cap companies, may be more volatile and less liquid than larger companies. If a real estate related company defaults on certain types of debt obligations held by the Fund, the Fund may acquire real estate directly, which involves additional risks such as
environmental liabilities; difficulty in valuing and selling the real estate; and economic or regulatory
changes.
Management Risk. The Fund is actively managed and depends heavily on the Adviser’s judgment about markets, interest rates or the
attractiveness, relative values, liquidity, or potential appreciation of particular investments made for
the Fund’s portfolio. The Fund could experience losses if these judgments prove to be incorrect. Additionally, legislative,
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regulatory, or tax developments may adversely affect management of the Fund and, therefore, the ability of the Fund to
achieve its investment objective.
Performance Information
The
bar chart and performance table provide an indication of the risks of investing in the Fund. The bar chart shows changes in the performance of the Fund from year to year as of December 31. The performance table compares the Fund's performance to that of a
style-specific benchmark, a peer group benchmark comprised of funds with investment objectives and
strategies similar to those of the Fund and a broad-based securities market benchmark (in that
order). The Fund's past performance (before and after taxes) is not necessarily an indication of its future performance.
Fund performance reflects any applicable fee waivers and expense reimbursements.
Performance returns would be lower without applicable fee waivers and expense reimbursements.
All Fund performance shown assumes the reinvestment of dividends and capital gains
and the effect of the Fund’s expenses.
Updated performance information is available on the Fund's website at
www.invesco.com/us.
Annual Total Returns
The bar chart does not reflect sales loads. If it did, the annual total returns shown would be lower.
| Class A |
Period Ended |
Returns |
| Best Quarter |
June 30, 2020 |
29.73% |
| Worst Quarter |
March 31, 2020 |
-28.96% |
Average Annual Total Returns (for the periods ended December 31, 2022)
| |
Inception Date |
1 Year |
5 Years |
10
Years |
| Class A |
|
|
|
|
| Return Before Taxes |
8/31/2000 |
-24.95% |
4.17% |
7.45% |
| Return After Taxes on Distributions |
|
-25.50 |
1.52 |
5.18 |
| Return After Taxes on Distributions and Sale of Fund Shares |
|
-14.45 |
2.97 |
5.65 |
| | ||||
| Class C |
8/31/2000 |
-21.96 |
4.55 |
7.41 |
| | ||||
| Class R |
6/3/2002 |
-20.79 |
5.09 |
7.79 |
| | ||||
| Class Y |
10/3/2008 |
-20.40 |
5.62 |
8.33 |
| | ||||
| Class R5 |
4/29/2005 |
-20.32 |
5.78 |
8.50 |
| | ||||
| Class R6 |
9/24/2012 |
-20.25 |
5.84 |
8.58 |
| | ||||
| Russell 2000® Index (reflects no deduction for fees, expenses or taxes) |
|
-20.44 |
4.13 |
9.01 |
| | ||||
| Lipper Small-Cap Core Funds Index |
|
-15.22 |
5.48 |
9.48 |
| | ||||
| S&P 500® Index (reflects no deduction for fees, expenses or taxes) |
|
-18.11 |
9.42 |
12.56 |
| | ||||
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor's tax situation and may differ from those shown, and after-tax returns
shown are not relevant to investors who hold their Fund shares through tax-advantaged arrangements, such as
401(k) plans, 529 college savings plans or individual retirement accounts. After-tax
returns are shown for Class A shares only and after-tax returns for other classes will vary.
Management of
the Fund
Investment Adviser: Invesco Advisers, Inc. (Invesco or the Adviser)
| Portfolio Managers |
Title |
Length of Service on the Fund |
| Juan Hartsfield, CFA |
Portfolio Manager (lead) |
2006 |
| | ||
| Davis Paddock, CFA |
Portfolio Manager |
2016 |
| | ||
Purchase and Sale of Fund Shares
You may purchase, redeem or exchange shares of the Fund on any business day through your financial adviser or by telephone at 800-959-4246. Shares of the Fund, other than Class R5 and Class R6
shares, may also be purchased, redeemed or exchanged on any business day through our website at
www.invesco.com/us or by mail to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
The minimum investments for Class A, C, R and Y shares for fund accounts are as follows:
| Type of Account |
Initial
Investment Per Fund |
Additional
Investments Per Fund |
| Asset or fee-based accounts managed by your financial adviser |
None |
None |
| | ||
| Employer Sponsored Retirement and Benefit Plans and Employer Sponsored IRAs |
None |
None |
| | ||
| IRAs and Coverdell ESAs if the new investor is purchasing shares through a systematic purchase plan |
$25 |
$25 |
| | ||
| All other types of accounts if the investor is purchasing shares through a systematic purchase plan |
50 |
50 |
| | ||
| IRAs and Coverdell ESAs |
250 |
25 |
| | ||
| All other accounts |
1,000 |
50 |
| | ||
With respect to Class R5 and Class R6 shares, there is no minimum initial investment for Employer Sponsored Retirement and Benefit Plans investing through a retirement platform that
administers at least $2.5 billion in retirement plan assets. All other Employer Sponsored Retirement and
Benefit Plans must meet a minimum initial investment of at least $1 million in each Fund in which it
invests.
For all other institutional investors purchasing Class R5 or Class R6 shares, the
minimum initial investment in each share class is $1 million, unless such investment is made by (i) an investment company, as defined under the Investment Company Act of 1940, as amended (1940 Act), that is part of a family of investment companies which
own in the aggregate at least $100 million in securities, or (ii) an account established with a 529 college
savings plan managed by Invesco, in which case there is no minimum initial investment.
There are no minimum investment amounts for Class R6 shares held through retail
omnibus accounts maintained by an intermediary, such as a broker, that (i) generally charges an asset-based fee or commission in addition to those described in this prospectus, and (ii) maintains Class R6 shares and makes them available to retail
investors.
Tax Information
The
Fund’s distributions generally are taxable to you as ordinary income, capital gains, or some combination of both, unless you are investing through a tax-advantaged arrangement, such as a 401(k) plan, 529 college savings plan or individual retirement account. Any
distributions from a 401(k) plan or individual retirement account may be taxed as ordinary income when
withdrawn from such plan or account.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund, the Fund’s distributor or its related companies may pay the intermediary
for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson or financial adviser to recommend the Fund over another
investment. Ask your
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