SOURCE: PowerShares Capital Management

February 21, 2007 06:00 ET

PowerShares FTSE RAFI US 1000 Portfolio Awarded Best ETF of 2006

CHICAGO, IL -- (MARKET WIRE) -- February 21, 2007 -- PowerShares Capital Management LLC continues Leading the Intelligent ETF Revolution® announcing today the PowerShares FTSE RAFI US 1000 Portfolio (NYSE: PRF) was selected by as the best ETF of 2006. considered performance results, expense ratio, and compelling strategy as the primary criteria for selecting the best ETF. In 2006, the PowerShares FTSE RAFI US 1000 portfolio outperformed the S&P 500 by approximately two percentage points after expenses. See standardized performance figures below.

The PowerShares family of ETFs includes 11 FTSE RAFI fundamentally weighted portfolios. These ETFs represent PowerShares' goal of providing investors with Intelligent Exposure to the securities markets. FTSE RAFI indexes assign individual company weights by determining the size of the economic contribution of each company in the economy. The size of a company's economic contribution is determined by evaluating four core fundamental measures of size: Book Value, Cash Flow, Dividends, and Sales. A company then receives a weight relative to the fundamental size of its peers.

The PowerShares FTSE™ RAFI US 1000 Portfolio is based on the FTSE™ RAFI US 1000 Index, which is designed to track the performance of the 1000 largest US equities. The rules-based index is based on the landmark fundamental-weighting strategy developed by Research Affiliates that analyzes and ranks securities using four fundamental measures of a firm's size: Book Value, Cash Flow, Dividends, and Sales. The equities with the highest fundamental strength are weighted by their fundamental scores to construct the index which is rebalanced and reconstituted annually.

"We are honored to be awarded the distinction of 'The Best ETF of 2006' and to share this honor with our index partners Research Affiliates, LLC and FTSE," said Bruce Bond, President of PowerShares Capital Management. "The flagship PowerShares FTSE RAFI US 1000 was the first fundamental-weighting ETF available in the US, and we believe represents a more intelligent way for investors to obtain exposure to the markets when compared to traditional cap-weighted benchmark indexes."

Rob Arnott, Chairman of Research Affiliates, LLC, added, "Today's widely utilized cap-weighted indexes tend to overweight over-valued companies and underweight under-valued companies, which results in a systematic performance drag. Fundamental indexes do not structurally link the weight in the index with the error in the price, and as a result have produced consistently higher returns at modestly lower risk, when compared to cap-weighted indexes. Extensive research has found that fundamental weighted indexes, on average, have outperformed the well-known cap-weighted indexes in the US by some 200 basis points a year. In international applications, the benefit surpasses 300 basis points, on average."

PRF-Performance Summary
Initial 1-Year Period
1/01/2006 - 12/31/2006

FTSE RAFI             1 Year      Since Inception      Sharpe     Beta
US 1000 Portfolio                 as of 12/31/2006    (1 Year)  (1 Year)
------------------  ----------  --------------------  --------  --------
PRF - NAV             18.86%           17.40%           2.90      0.85
PRF After Tax Held    18.39%           16.95%
PRF After Tax Sold    12.24%           14.52%
PRF - Share Price     18.67%           17.87%           2.70      0.85
S&P 500 Index         15.79%           14.30%           1.96      1.00

Fund Inception: December 19, 2005
Source: PowerShares Capital Management LLC
Performance data quoted represents past performance. Past performance is not a guarantee of future results; current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate and Shares, when redeemed, may be worth more or less than their original cost. The Shares' performance reflects fee waivers, absent which, performance would have been lower. See to find the most recent month-end performance numbers. After Tax Held represents total return after taxes on distributions and assumes Shares have not been sold. After Tax Sold represents total return after taxes on distributions and the sale of Fund Shares. After-tax returns reflect the highest federal income tax rate but exclude state and local taxes.

Fund history and all inception performance are based on the inception date of the fund. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.

A Sharpe Ratio is the risk-adjusted return and is the return less the risk-free rate divided by the standard deviation of the return; Beta is a measure of relative risk and is the slope of the regression line; and Volatility is the annualized standard deviation of monthly index returns. Sharpe ratio, beta and volatility data is calculated daily. The S&P 500 Index is an unmanaged index used as a measurement of change in stock market conditions based on the average performance of approximately 500 common stocks. An investor cannot invest directly in an index.

PowerShares Capital Management LLC is passionate about its goal of efficiently delivering the highest quality institutional investment management services available. PowerShares is Leading the Intelligent ETF Revolution® providing investment advisors with institutional caliber asset management that seeks to replicate enhanced indexes in one of the more benefit rich investment vehicles available in the marketplace today, the exchange-traded fund. The firm is committed to theoretically sound portfolio construction and empirically verifiable investment management approaches. PowerShares' asset management philosophy and investment discipline are deeply rooted in the application of intuitive factor analysis and model implementation to enhance investment decisions.

Research Affiliates, LLC, with its office in Pasadena, California, was founded in 2002 to engage in quantitative investment research designed to products. These products are primarily implemented and introduced affiliations with other firms. Research Affiliates currently has assets under management or license of $US 20 Billion. Research Affiliates offers sub-advisory services and pioneering investment product development.

FTSE Group is a world leader in the creation and management of indexes. With offices in Beijing, London, Frankfurt, Hong Kong, Madrid, Paris, New York, San Francisco, Boston, Shanghai and Tokyo, FTSE Group services clients in 77 countries worldwide. FTSE indexes are used extensively by investors worldwide for investment analysis, performance measurement, asset allocation, portfolio hedging and for creating a wide range of index tracking funds. Independent committees of senior fund managers, derivatives experts, actuaries and other experienced practitioners review all changes to the indexes to ensure that they are made objectively and without bias. Real-time FTSE indexes are calculated on systems managed by Reuters. Prices and FX rates used are supplied by Reuters.

Risks of Owning Exchange-Traded Funds

Exchange-Traded Funds are made up of publicly traded securities that can and will move higher and lower with market movements. You should anticipate that the value of the shares of each fund will advance or decline more or less in correlation with the advance or decline in value of the applicable index. The Funds are not actively managed, and shares of the Funds may trade at or below the Funds' NAV. Exchange-traded funds are subject to risks similar to those of stocks, including risks associated with short-selling and margin account maintenance. Ordinary brokerage commissions apply.

A I M Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust. A I M Distributors, Inc. is not affiliated with Research Affiliates, LLC.

An investor should consider the Fund's investment objectives, risks, charges and expenses carefully before investing. For this and more complete information about the Fund, call 800.983.0903 or visit the website for a prospectus. Please read the prospectus carefully before investing.

PowerShares® and Leading the Intelligent ETF Revolution® are registered marks of PowerShares Capital Management, LLC. "FTSE®" is a trademark of the London Stock Exchange Plc and The Financial Times Limited and is used by FTSE International Limited under license. "Research Affiliates" and "Fundamental Index" are trademarks of Research Affiliates.

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