SOURCE: PowerShares

May 11, 2005 10:46 ET

PowerShares Funds Cross Two Year Mark, Providing Impressive Benchmark Outperformance

CHICAGO, IL -- (MARKET WIRE) -- May 11, 2005 -- PowerShares Capital Management LLC announced today that the PowerShares Dynamic Market Portfolio (AMEX: PWC) and Dynamic OTC Portfolio (AMEX: PWO) have accomplished an impressive two year performance record with both funds delivering significant outperformance compared to the benchmarks. Neither fund has paid any capital gains distributions.

Performance Summary

PowerShares Dynamic Market Portfolio    Inception    1 Year
------------------------------------    ---------    ------
PWC - NAV                                  21.12%    12.25%
PWC - Share Price                          21.10%    11.86%
S&P 500 Index                              14.38%     6.34%
Russell 3000                               15.76%     6.97%

PowerShares Dynamic OTC Portfolio       Inception    1 Year
---------------------------------       ---------    ------
PWO - NAV                                  21.86%    15.80%
PWO - Share Price                          21.49%    15.17%
Nasdaq 100 Index                           13.29%     1.73%
Nasdaq Composite                           14.79%     0.67%
Since Inception Statistics
PowerShares Dynamic Market Portfolio     Sharpe       Beta     Volatility
---------------------------------       ---------    ------    ----------
PWC - NAV                                   1.82      1.07       10.82%
PWC - Share Price                           1.78      1.11       11.04%
S&P 500 Index                               1.52      1.00        8.54%
Russell 3000                                1.57      1.06        9.16%

PowerShares Dynamic OTC Portfolio         Sharpe      Beta     Volatility
---------------------------------       ---------    ------    ----------
PWO - NAV                                   1.26      0.99       16.22%
PWO - Share Price                           1.17      1.04       17.18%
Nasdaq 100 Index                            0.78      1.00       15.14%
Nasdaq Composite                            0.90      1.00       14.93%
Performance as of 4/29/2005, Fund Inceptions 5/01/2003. 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 may be worth more or less than their original cost when sold or redeemed. See to find the most recent performance numbers and information regarding premiums and discounts. Price returns are based on closing market prices.

The S&P 500 Index and Russell 3000 Index are accepted benchmarks for the performance of the broad US stock market; the Nasdaq 100 Index and Nasdaq Composite are accepted benchmarks for the performance of the Nasdaq stock market. You cannot invest directly in an index. 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.

PowerShares Xchange Traded Funds

PowerShares is able to deliver this value added performance because they are the first Exchange Trade Funds (ETFs) based on Enhanced Indexes. These enhanced indexes use sophisticated methodologies which are designed to select the finest stocks from the market groups to provide representation instead of including the entire group like traditional benchmark indexes.

PowerShares are Exchange Traded Funds (ETFs) which, unlike traditional benchmark based ETFs, incorporate enhanced indexes. These enhanced indexes utilize advanced quantitative methodologies to discriminate between securities and select the stocks identified as having the greatest capital appreciation potential. In contrast, traditional benchmark indexes select stocks primarily for representation, regardless of their investment merit.

The PowerShares Dynamic Portfolios base their stock selection, portfolio management, and asset allocation decisions on intelligent indexes derived from the Dynamic Intellidex Methodology which evaluates companies across numerous investment criteria to determine their investment merit. Securities shown to possess the greatest capital appreciation potential are selected for the index and then incorporated into the fund.

PowerShares Dynamic Market Portfolio (AMEX: PWC)
PowerShares Dynamic OTC Portfolio (AMEX: PWO)
PowerShares High Yield Equity Dividend Achievers Portfolio (AMEX: PEY)
PowerShares Gold Dragon Halter USX China Portfolio (AMEX: PGJ)
PowerShares WilderHill Clean Energy Portfolio (AMEX: PBW)
PowerShares Dynamic Large Cap Growth Portfolio (AMEX: PWB)
PowerShares Dynamic Large Cap Value Portfolio (AMEX: PWV)
PowerShares Dynamic Mid Cap Growth Portfolio (AMEX: PWJ)
PowerShares Dynamic Mid Cap Value Portfolio (AMEX: PWP)
PowerShares Dynamic Small Cap Growth Portfolio (AMEX: PWT)
PowerShares Dynamic Small Cap Value Portfolio (AMEX: PWY)
PowerShares Capital Management LLC

PowerShares Capital Management, LLC provides institutional caliber asset management and market exposure through the replication of enhanced indexes. PowerShares delivers this sophisticated asset management in one of the more benefit rich investment vehicles available 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.

Risks of Owning PowerShares

PowerShares 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.

An investor should consider investment objectives, risks, charges and expenses carefully before investing. A prospectus which contains more complete information about PowerShares, including, risks, fees and expenses can be obtained by visiting the PowerShares web site at or by calling 800-THE-AMEX. The prospectus should be read carefully before investing.

ALPS Distributors, Inc. is the distributor of the PowerShares Exchange Traded Fund Trust.

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