What happened
According to a filing with the Securities and Exchange Commission updating Q3 holdings, WBI Investments, LLC reported selling 82,398 shares of Victory Portfolios II - VictoryShares Free Cash Flow ETF (VFLO 0.53%). The post-trade position stands at 160,664 shares, valued at $6.02 million, down from 1.77% to 1.54% of the fund's AUM compared to the previous quarter.
What else to know
This was a reduction; VFLO now represents 1.54% of WBI Investments, LLC’s 13F AUM, which places it inside the fund's top five holdings.
Top holdings after the filing:
- WBIY: $24.10 million (6.2% of AUM)
- WBIL: $20.95 million (5.4% of AUM)
- WBIG: $20.85 million (5.3% of AUM)
- WBIF: $18.35 million (4.7% of AUM)
- VFLO: $6 million (1.5% of AUM)
As of Dec. 28, 2025, shares were priced at $39.8, up 16.3% over the past year.
Company overview
| Metric | Value |
|---|---|
| Price (as of market close 2025-11-19) | $37.32 |
| Dividend yield | 1.57% |
| 1-year total return (including dividends) | 18.3% |
Company snapshot
- The ETF's investment strategy focuses on tracking an index of 50 U.S. large- and mid-cap companies selected for robust free cash flow characteristics.
- The portfolio uses a free cash flow screen to seek out companies with high free cash flow yield without sacrificing growth potential.
- The structure is an exchange-traded fund with a rules-based methodology; expense ratio details are available in regulatory filings.
VictoryShares Free Cash Flow ETF (VFLO) offers investors exposure to a curated basket of U.S. large- and mid-cap equities, emphasizing companies with strong free cash flow generation. The ETF employs a replication strategy to closely track its custom index, aiming to deliver performance before fees and expenses that mirrors the underlying holdings. This approach provides institutional investors with a transparent, rules-based vehicle for accessing quality U.S. equities with an income component.
Foolish take
WBI's reduction is shares likely doesn't represent any lack of confidence in future returns the ETF. Total returns, including dividends, have outpaced the S&P 500 index this year, and taking some of that gain could make sense.
Holding VFLO in any investor's portfolio also makes sense, though. The fund's composition is created by starting with the largest 400 profitable companies. A free cash flow screen then narrows it down to the 75 highest free cash flow yielding value stocks. It then eliminates companies with high free cash flow but with weak growth prospects to leave 50 stocks of growing companies with high free cash flow yield.
The VFLO ETF could be an anchor holding in any portfolio. Long-term gains are more likely when a growing company has a high free cash flow yield. Those companies can use excess cash to directly return to shareholders via dividends or share buybacks. They can also repay debt or make new growth investments for the business. Each of these strategies has a good chance of paying off for shareholders.
Glossary
ETF (Exchange-Traded Fund): A fund traded on stock exchanges, holding a basket of securities like stocks or bonds.
Free cash flow: The cash a company generates after accounting for capital expenditures, available for dividends, debt repayment, or reinvestment.
AUM (Assets Under Management): The total market value of assets that an investment firm or fund manages on behalf of clients.
13F reportable assets: Securities that institutional investment managers must disclose quarterly to the SEC if managing over $100 million.
Replication strategy: An investment approach where a fund seeks to mirror the performance of a specific index by holding its components.
Rules-based methodology: An investment strategy that follows predetermined, systematic criteria for selecting and weighting securities.
Dividend yield: A financial ratio showing how much a company pays in dividends each year relative to its share price.
Total return: The investment's price change plus all dividends and distributions, assuming those payouts are reinvested.
Portfolio composition: The mix of different asset types, sectors, or securities held within a fund or investment portfolio.
Expense ratio: The annual fee expressed as a percentage of assets, covering a fund's operating costs.
Institutional investors: Organizations such as pension funds, insurance companies, or asset managers that invest large sums of money.
Custom index: A benchmark specifically designed to track a unique set of securities, often tailored for a particular fund or strategy.
