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Invesco Shareholders Approve QQQ Reclassification to Open-End ETF

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Key Takeaways

  • QQQ shareholders approved converting the trust to an open-end ETF with a new board of trustees.
  • Invesco says the shift unlocks efficiencies, allows lending and reinvestment, and cuts the expense ratio.
  • QQQ will keep tracking the Nasdaq-100 and remain part of the QQQ Innovation Suite after the change.

Shareholders of Invesco Ltd.’s (IVZ - Free Report) QQQ Trust, Series 1, have approved a proposal to reclassify Invesco QQQ into an open-end exchange-traded fund (ETF), along with a change in its governance structure to a board of trustees.

Rationale Behind Invesco’s Move

QQQ has operated under a legacy unit investment trust (UIT) structure since its 1999 launch, which helped establish the fund but now restricts reinvesting dividends, securities lending and other efficiencies. As ETFs have evolved, UITs have become costlier and less flexible. The reclassification aims to align QQQ with today’s open-end ETF model to unlock operational efficiencies and reduce expense ratio. This is also expected to drive revenues.

As part of the conversion, Invesco QQQ’s total expense ratio will be reduced to 0.18% from 0.20%, benefiting shareholders. The new structure will also allow the fund to reinvest income and engage in securities lending, with no tax consequences for investors.

Despite the structural changes, QQQ will continue to replicate the Nasdaq-100 Index and remain an integral part of Invesco’s QQQ Innovation Suite, enabling investors to customize their index exposure through a suite of 10 differentiated ETFs.

Andrew Schlossberg, president and CEO of Invesco, stated, “I want to thank the shareholders who voted to transform Invesco QQQ into a modern ETF format. We are proud to deliver a ten percent reduction in fees to QQQ investors while creating more flexibility to utilize tools that could deliver better outcomes for investors.”

This move aligns with Invesco’s efforts to grow its assets under management, which, in turn, would boost its revenues. Earlier this month, it collaborated with LGT Capital Partners to expand private markets access for U.S. wealth and retirement investors. In April 2025, the company collaborated with MassMutual’s subsidiary, Barings, to enhance private credit offerings.

Invesco’s Price Performance and Zacks Rank

Shares of IVZ have soared 80.8% in the past six months against the industry’s decline of 2.1%.

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At present, Invesco sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Product Enhancement Efforts by Other Finance Firms

Last week, Truist Financial Corp. (TFC - Free Report) introduced the electronic direct deposit switching feature to its digital onboarding process for clients, improving the ease and speed of new account openings.

In partnership with Atomic, Truist has fully integrated this capability into its digital account opening process, streamlining the transfer of direct deposits from other accounts. Since its launch in August, 19% of new digital applicants who used the feature have completed the switch.

The announcement aligns with Truist’s continued investments to deliver a more digitally enabled client experience and support long-term financial success.
 
Similarly, earlier this month, F.N.B. Corp. (FNB - Free Report) introduced Payment Switch, a service that allows clients to automatically transfer their recurring Automated Clearing House and debit card payments to FNB through the FNB Direct Mobile Banking App.

As one of the first banks to roll out this service, Payment Switch simplifies customer onboarding and supports FNB’s strategy to become clients’ primary bank. Payment Switch complements the company’s Direct Deposit Switch by removing common obstacles when customers open a new account or switch banks. The automated service enables near-real-time updates of debit card or checking account payments across multiple merchants, all within the FNB Mobile Banking app, saving customers time and effort.


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