PowerShares FTSE RAFI Developed Markets ex-U.S. Portfolio (the Fund) is based on the FTSE RAFI Developed Markets ex-U.S. Index (the Index). The Fund will normally invest at least 90% of its total assets in securities that comprise the Index and American Depositary Receipts (ADRs) based on the securities in the Index. The Index is designed to track the performance of the largest developed market equities (excluding the United States), selected based on the four fundamental measures of firm size: book value, income, sales and dividends. The 1000 equities with the highest fundamental strength are weighted according to their fundamental scores. The fundamentally weighted portfolio is rebalanced and reconstituted annually. The Fund invests in consumer discretionary, consumer staples, energy, financials, health care, industrials, information technology, telecommunication services, utilities and materials sectors. The Fund’s investment advisor is Invesco PowerShares Capital Management LLC.