-- PMNA - PowerShares MENA Frontier Counties Portfolio
"The PowerShares MENA Frontier Countries Portfolio replicates an index that
takes into account certain foreign ownership limitations encountered when
investing in certain countries in the Middle East and North Africa," said
Bruce Bond, president and CEO of Invesco PowerShares. "We believe PMNA
represents a compelling new vehicle for investors to access frontier equity
markets of the MENA region."
The PowerShares MENA Frontier Countries Portfolio (PMNA) is based on the
NASDAQ OMX Middle East North Africa Index(SM). This Index is designed to
measure the performance of the largest and most liquid securities of
companies domiciled in Middle Eastern and North African countries included
in the Index that have smaller economies or less developed capital markets
than traditional emerging markets. The Index currently includes securities
domiciled in: Egypt, Morocco, Oman, Lebanon, Jordan, Kuwait, Bahrain, Qatar
and United Arab Emirates (Index currently includes the emirates of Dubai
and Abu Dhabi).
Many of these frontier countries impose restrictions on foreign
investments, including foreign ownership limitations. These restrictions
may vary from issuer to issuer. At each quarterly rebalance and
reconstitution, NASDAQ OMX Group, Inc., the index provider, takes into
account the current foreign ownership limitations and locked-in stock. In
addition, when a security in the Index reaches its limitations on foreign
ownership, it will be removed from the Underlying Index.
An investment in securities of frontier market countries involves risks not
associated with investments in securities of developed countries.
Invesco PowerShares is leading the intelligent ETF revolution through its
family of more than 100 domestic and international index-based and actively
managed exchange-traded funds. With assets under management as of April 30,
2008 of $13.86 billion, PowerShares ETFs trade on all of the major U.S.
stock exchanges that trade ETFs. For more information, please visit us at
www.invescopowershares.com.
Invesco PowerShares is a part of Invesco Ltd., a leading independent global
investment management company dedicated to helping people worldwide build
their financial security. By delivering the combined power of its
distinctive worldwide investment management capabilities, including AIM,
Atlantic Trust, Invesco, Perpetual, PowerShares, Trimark, and WL Ross,
Invesco provides a comprehensive array of enduring investment solutions for
retail, institutional and high-net-worth clients around the world.
Operating in 20 countries, the company is currently listed on the New York
Stock Exchange under the symbol IVZ. Additional information is available at
www.invesco.com.
There are risks involved with investing in ETFs including possible loss of
money. Shares are not actively managed and are subject to risk similar to
stocks and covered call options, as well as those risks related to short
selling and margin maintenance.
Small- and Medium-Sized Company Risk Information
An investment in securities of small and medium-sized companies involves
greater risk than is customarily associated with investing in more
established, larger sized companies.
Foreign Risk Information
An investment in the securities of non-U.S. issuers involves risks beyond
those associated with investments in U.S. securities, including, but not
limited to: greater
market volatility, the availability of less reliable financial information,
higher transactional and custody costs, taxation by foreign governments,
decreased
market liquidity, political instability, negative impact of changes in
currency exchange rates or foreign governmental regulation, currency risk,
fluctuation due to changes in interest rates, effects of monetary policies
issued by the United States, foreign governments, central banks or
supranational entities and currency controls or other national or global
political economic developments, among others.
Frontier Market Risk Information
An investment in securities of frontier countries involves risks not
associated with investments in securities of developed countries,
including, but not limited
to: generally smaller economies or less developed capital markets than
traditional emerging markets, economies that are less correlated to global
economic
cycles than those of their more developed counterparts, low trading
volumes, potential for extreme price volatility and illiquidity, which may
be further heightened by the actions of a few major investors, governments
of many frontier countries in which the Fund invests may exercise
substantial influence over
many aspects of the private sector (in some cases, the governments of such
frontier countries may own or control certain companies), government
action,
heavy dependency upon international trade which has been and may continue
to be, adversely affected by trade barriers, exchange controls, managed
adjustments in relative currency values and other protectionist measures
imposed or negotiated by the countries with which they trade, and risks
associated
with certain foreign governments in countries in which the Fund invests
levying withholding or other taxes on dividend and interest income,
sanctions or
embargoes imposed by the U.S. government and the United Nations and/or
countries identified by the U.S. government as state sponsors of terrorism
and foreign investment holdings limitations, among others.
Micro-Capitalization Company Risk Information
Investments in securities of micro-capitalization companies involve
substantially greater risks of loss and price fluctuations because their
earnings and revenues
tend to be less predictable (and some companies may be experiencing
significant losses), and their share prices tend to be more volatile and
their markets less liquid than companies with larger market
capitalizations.
Non-Diversified Fund & Industry Risk Information
The Fund is considered non-diversified and can invest a greater portion of
assets in securities of individual issuers than a diversified fund. As a
result, changes
in the market value of a single investment could cause greater fluctuations
in share price than would occur in a diversified fund.
The economies of frontier country markets are less developed and can be
overly reliant on particular industries. It is likely that a substantial
number of stocks
included in the Underlying Index for certain of the MENA frontier countries
will be securities of banks and other financial institutions.
When a Fund is focused in a specific industry or sector, it presents
greater risks than if it were broadly diversified over numerous industries
and sectors of the economy. Please read the prospectus for a summary of
these risks pertaining to each industry or sector.
Tax Consequences of Redemption Proceeds Being Limited Primarily to Cash
Risk Information
Unlike most exchange-traded funds, the Fund does not and currently intends
to make primarily in-kind redemptions. As such the Fund may be required to
sell
portfolio securities in order to obtain the cash needed to distribute
redemption proceeds. Generally, this will cause the Fund to recognize gain
it might not
otherwise have recognized, or to recognize such gain sooner than would
otherwise be required, if it were able to distribute the shares primarily
in-kind. Based on
the U.S. federal income tax rules applicable to the fund and an investment
in the Fund, this may cause particular shareholders to be subject to tax on
gains they
would not otherwise be subject to, or at an earlier date than, if they had
made an investment in a different exchange-traded fund.
Participation Notes ("P-notes") and their Risks The Fund initially expects
to invest up to 20% of its net assets in P-notes in seeking to track the
performance of Kuwaiti securities included in the Underlying Index.
P-notes generally are issued by banks or broker-dealers and are promissory
notes that are designed to offer a return linked to the performance of a
particular underlying equity security or market. The return on a P-note
that is linked to a particular underlying security generally is increased
to the extent of any dividends paid in connection with the underlying
security. However, the holder of a P-note typically does not receive voting
rights as it would if it directly owned the underlying security. P-notes
constitute direct, general and unsecured contractual obligations of the
banks or broker-dealers that issue them, which therefore subjects the Fund
to counterparty risk, as discussed below.
Investments in P-notes involve certain risks in addition to those
associated with a direct investment in the underlying foreign companies or
foreign securities markets whose return they seek to replicate. For
instance, there can be no assurance that there will be a trading market for
a P-note or that the trading price of a P-note will equal the underlying
value of the foreign company or foreign securities market that it seeks to
replicate. As the purchaser of a P-note, the Fund is relying on the
creditworthiness of the counterparty issuing the P-note and has no rights
under a P-note against the issuer of the underlying security. Therefore, if
such counterparty were to become insolvent, the Fund would lose its
investment. The risk that the Fund may lose its investments due to the
insolvency of a counterparty may be amplified because the Fund intends to
purchase P-notes issued by as few as one issuer. In seeking to limit its
counterparty risk, the Fund will limit its investment in P-notes of any one
issuer to $5 million at the time of purchase and to counterparties who meet
the creditworthiness standard required of issuers whose securities are
eligible for investment by money market funds. P-notes also include
transaction costs in addition to those applicable to a direct investment in
Kuwaiti securities. In addition, the Fund's use of P-notes may cause the
Fund's performance to deviate from the performance of the portion of the
Underlying Index to which the Fund is gaining exposure through the use of
P-notes.
Due to liquidity and transfer restrictions, the secondary markets on which
the P-notes are traded may be less liquid than the markets for other
securities, or may be completely illiquid, which may lead to the absence of
readily available market quotations for securities in the Fund's portfolio
and which may also lead to delays in the redemption of Fund Shares. In
addition, the ability of the Fund to value its securities becomes more
difficult and the judgment in the application of fair value procedures
(through fair value procedures adopted by the Trustees) may play a greater
role in the valuation of the Fund's securities due to reduced availability
of reliable objective pricing data. Consequently, while such determinations
will be made in good faith, it may nevertheless be more difficult for the
Fund to accurately assign a daily value to such securities.
NASDAQ®, OMXTM and NASDAQ OMX Middle East North Africa Index(SM) are
trade/service marks of The NASDAZ OMX Group, Inc. (which with its
affiliates is referred to as the "Corporations") and are licensed for use
by Invesco PowerShares. The Fund has not been passed on by the Corporations
as to their legality or suitability. The Fund is not issued, endorsed, sold
or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND
BEAR NO LIABILITY WITH RESPECT TO THE FUND.
Shares are not FDIC insured, may lose value and have no bank guarantee.
Shares are not individually redeemable and owners of the shares may acquire
those shares from the Fund and tender those shares for redemption to the
Fund in Creation Unit aggregations only, typically consisting of 100,000
shares.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares
Exchange-Traded Fund Trust II.
Invesco PowerShares Capital Management LLC and Invesco Aim Distributors,
Inc. are indirect, wholly owned subsidiaries of Invesco Ltd.
An investor should consider the Fund's investment objective, risks, charges
and expenses carefully before investing. For a copy of the prospectus,
which contains this and other information about the Fund, call 800.983.0903
or visit our website www.invescopowershares.com. Please read the prospectus
carefully before investing.
Contact Information: Media Contacts: Kristin Sadlon Porter Novelli 212-601-8192 Bill Conboy BC Capital Partners 303-415-2290