Invesco Nasdaq 100 ETF (QQQM US) – Portfolio Construction Methodology

The underlying Nasdaq-100 Index targets the 100 largest Nasdaq-listed non-financial companies by market cap. Eligible security types are common stock, tracking stocks, and ADRs; companies in the ICB Real Estate industry are eligible unless they are organized as REITs (REITs themselves are ineligible). Financials (per ICB) are excluded. Securities must have their primary U.S. listing on the Nasdaq Global Select or Nasdaq Global Market, be seasoned for ≥3 full calendar months, have free float ≥10%, and a 3-month average daily traded value ≥ USD 5m. The annual December reconstitution ranks companies by market cap: the top 75 are selected; existing members ranked ≤100 are retained; and, if needed, additional retention can extend to ranks 101–125 under the standard buffer rules. Weighting is modified market cap with quarterly rebalances (Mar/Jun/Sep) enforcing caps: no company >24% and the combined weight of >4.5% names ≤48%; if binding, a two-stage 20%/40% adjustment is applied. At the annual reweight, additional limits apply (≈14% per security; aggregate of the five largest set to 38.5% if needed, with others capped to preserve rank).

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