The PowerShares FTSE RAFI Developed Markets ex-U.S. Portfolio (Fund) is based on the FTSE RAFI Developed Markets ex-U.S. Index (Index). The Fund will normally invest at least 90% of its total assets in securities that comprise the Index and American Depository 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 U.S.), selected based on the following 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 Fund is rebalanced quarterly and reconstituted with Marchs rebalance.