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Invesco QQQ Trust QQQ Sustainability

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Sustainability Analysis

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Sustainability Summary

Invesco QQQ Trust has several promising attributes that may appeal to sustainability-focused investors.

Invesco QQQ Trust's holdings are exposed to average levels of ESG risk relative to those of its peers in the US Equity Large Cap Growth category, thus earning it an average Morningstar Sustainability Rating of 3 globes. Competing funds in the category with ratings of 4 or 5 globes have less ESG risk in their holdings. ESG risk provides investors with a signal that reflects to what degree their investments are exposed to risks related to material ESG issues, including climate change, biodiversity, product safety, community relations, data privacy and security, bribery and corruption, and corporate governance, that are not sufficiently managed. ESG risk differs from impact, which is about seeking positive environmental and social outcomes.

One key area of strength for Invesco QQQ Trust is its low Morningstar Portfolio Carbon Risk Score of 3.63 and very low fossil fuel exposure over the past 12 months, which earns it the Morningstar Low Carbon Designation. Thus, the companies held in the portfolio are in general alignment with the transition to a low-carbon economy.

One potential issue for a sustainability-focused investor is that Invesco QQQ Trust doesn’t have an ESG-focused mandate. A fund with an ESG-focused mandate would have a higher probability to drive positive ESG outcomes.

The fund exhibits moderate exposure (8.88%) to companies with high or severe controversies. Controversies are incidents that have a negative impact on stakeholders or the environment, which create some degree of financial risk for the company. Examples of types of controversies include bribery and corruption scandals, workplace discrimination and environmental incidents. Severe and high controversies can have significant financial repercussions, ranging from legal penalties to consumer boycotts. Such controversies can also damage the reputation of both companies themselves and their shareholders.

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ESG Commitment Level Asset Manager

 | Basic