PowerShares Active AlphaQ Fund (the Fund) is an exchange-traded fund that seeks to achieve long-term capital appreciation. The Fund’s portfolio generally consists of 50 Nasdaq–listed securities selected using a stock screening methodology developed by its sub-advisor, AER Advisors, Inc. The Fund rates the stocks of companies with more than $400 million market cap (about 3,000 stocks) that are traded in the United States. Weekly, the Fund’s sub-advisor generates a master stock list that ranks these stocks, segmented by market cap, based on its stock ranking methodology. Stocks are selected based on factors such as strong earnings growth, low valuations and positive money flow. Fund managers then define their universe as the 100 largest Nasdaq-listed global market securities from their master stock list. The Fund then generally selects and purchases approximately 50 stocks. The Fund’s investment advisor is Invesco PowerShares Capital Management LLC.