VICTORY GROWTH AND TAX STRATEGY FUND

QUARTERLY COMMENTARY

As of December 31, 2024

The portfolio managers of the Victory Growth and Tax The Equity Portfolio
Strategy Fund invest the Fund’s assets in municipal bonds
During the fourth quarter, the stock market’s momentum
and blue-chip stocks. The Victory Income Investors team
showed some signs of slowing down. Stocks surged early
manages the Fund’s fixed income portfolio with a goal of
in the fourth quarter as investors digested the outcome of
producing a high level of tax-exempt income. Victory
U.S. elections and anticipated a new pro-business and
Solutions, which uses active tax management and stock
lower-regulatory environment. But volatility reared up once
selection aiming to provide aggregate investment
again in December.
characteristics similar to those of the S&P 500® Index
without sacrificing performance, manages the equity The Fed cut interest rates for the third time at their
portfolio. December FOMC meeting (lowering the federal funds rate
a total of 100 basis points over the course of the year), but
During the fourth quarter, the Victory Growth and Tax
left investors surprised by suggesting that there may be
Strategy Fund (fund shares) underperformed its composite
fewer rate cuts ahead. Given the lofty valuations, some
benchmark, which is composed of 50% stocks and 50%
investors took profits and December turned out to be a
bonds.
rough month for stocks.
The Municipal Portfolio During the period, four of eleven market sectors were
The municipal market experienced negative returns this positive.
quarter. Throughout the fourth quarter the Federal Reserve
(Fed) continued with easing monetary policy, reducing
rates by 25 basis points* (bps) in November and
December. Markets experienced notable volatility pre-
election, but much subsided heading into December. While
markets were uncertain on the number of rate cuts to
expect in 2025, a strong economy and increased
inflationary pressures linked to policies of the incoming
administration caused investors to shift gears and reduce
the number of cuts expected from four to two in the next
year. The Bloomberg Municipal Bond Index returned
-1.22% for the fourth quarter of 2024, beating the
Bloomberg U.S. Aggregate Bond Index, which returned
-3.06%. Performance was largely driven by the Treasury
yield curve, which seesawed throughout the quarter,
trending downward prior to the presidential election in
November but pushed higher toward the end of the year.
Inflation trended sideways while the labor market remained
stable, which resulted in the market pricing in stickier
inflation and a rise in term premiums. However, the
economy continues to show resilience, and credit spreads
remained tight. The yield of the Bloomberg Municipal Bond
Index rose from 3.32% at the end of the third quarter to
3.74% at the end of the fourth quarter of 2024, which is a
taxable-equivalent yield of 6.32% (in the highest tax
bracket). We continue to believe that current yield levels
offer investors an attractive entry point into the muni
market and are even more attractive when you consider
the tax-free treatment of most municipal bonds.
* A basis point is one-hundredth of a percentage point (0.01%) and is
abbreviated as “bp” (plural “bps”).

1
Not FDIC Insured • May Lose Value • No Bank Guarantee

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 VICTORY GROWTH AND TAX STRATEGY FUND As of December 31, 2024

Standardized Performance: December 31, 2024

Average Annual Returns (%)
Inception Since Expense Ratio
Victory Growth and Tax Strategy Fund Ticker Q4 2024 1 Year 5 Year 10 Year
Date Inception Gross Net
Fund Shares USBLX 01/11/89 0.29 13.32 7.09 7.17 6.99 0.51 0.51
Fund Shares, after taxes on distributions1 USBLX 01/11/89 0.14 12.25 6.75 6.79 6.46 0.51 0.51
Fund Shares, after taxes on distributions and sale
USBLX 01/11/89 0.17 7.86 5.67 5.86 6.09 0.51 0.51
of shares2
A Shares, without sales charge UGTAX 06/29/20 0.21 12.96 – – 8.17 0.93 0.83

A Shares, with sales charge (max. 2.25%) UGTAX 06/29/20 -2.05 10.41 – – 7.63 0.93 0.83

C Shares, without sales charge UGTCX 06/29/20 0.05 12.11 – – 7.37 1.76 1.58
C Shares, with sales charge UGTCX 06/29/20 -0.95 11.11 – – 7.37 1.76 1.58
Institutional Shares UGTIX 06/29/20 0.28 13.29 – – 8.49 0.54 0.54
S&P 500® Index – – 2.41 25.02 14.53 13.10 – – –
Bloomberg Municipal Bond Index – – -1.22 1.05 0.99 2.25 – – –
Composite Index – – 0.60 12.54 7.87 7.82 – – –

Past performance does not guarantee future results. The performance quoted represents past performance and current performance may be
lower or higher. The investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less
than the original cost. To obtain performance information current to the most recent month-end, visit www.vcm.com. Returns include
reinvestment of dividends and capital gains. Performance for periods greater than one year is annualized. Fee waivers and/or expense reimbursements
were in place for some or all periods shown, without which Fund performance would have been lower. Class C Shares are subject to a deferred sales
charge of 1.00% on shares redeemed within the first year. Net expense ratio reflects the contractual waiver and/or reimbursement of management fees
through June 30, 2025. After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the
impact of state and local taxes. Actual after-tax returns depend on the investor’s tax situation and may differ from those shown. The after-tax returns
shown are not relevant to investors who hold their fund shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts.
After-tax returns are shown for only one share class. After-tax returns for other classes will vary.
1Return after taxes on distributions. Assumes fund shares have not been sold.
2Return after taxes on distributions and sale of fund shares.

Carefully consider a fund’s investment objectives, risks, charges and The S&P 500® Index is a market-capitalization-weighted index that
expenses before investing. To obtain a prospectus or summary measures the performance of the common stocks of 500 leading U.S.
prospectus containing this and other important information, visit companies.
www.vcm.com/prospectus. Read it carefully before investing. The Bloomberg Municipal Bond Index is considered to be generally
All investing involves risk, including the potential loss of principal. In representative of investment-grade municipal issues having remaining
addition to the normal risks associated with investing, asset allocation and maturities greater than one year and a national scope.
diversification do not promise any level of performance or guarantee The Composite Index is split evenly between stocks and bonds, with the
against loss of principal. Fixed income securities are subject to interest S&P 500® Index and the Bloomberg Municipal Bond Index each
rate, inflation, credit, and default risk. The bond market is volatile. Bonds constituting 50% of the Composite Index.
and bond funds will decrease in value as interest rates rise and vice versa.
Credit risk refers to the possibility that debt issuers may not be able to The Bloomberg U.S. Aggregate Bond Index measures the investment
make principal and interest payments or may have their debt downgraded grade, USD-denominated, fixed-rate taxable bond market. The index
by ratings agencies. High yield securities may be more volatile, be subject includes Treasuries, government-related and corporate securities, MBS,
to greater levels of credit or default risk, and may be less liquid and more ABS and CMBS.
difficult to sell at an advantageous time or price than higher-rated securities The Bloomberg U.S. Universal Index is an index that represents the
of similar maturity. The Fund is also subject to liquidity risk, which is the union of the U.S. Aggregate Index, U.S. Corporate High-Yield Index,
risk that the Adviser may not be able to sell a security at an advantageous Investment Grade 144A Index, Eurodollar Index, U.S. Emerging Markets
time or price, which may adversely affect the Fund. Some tax-exempt Index, and the non-ERISA eligible portion of the CMBS Index. The index
securities, including variable-rate demand notes (VRDNs), are subject to covers USD-denominated, taxable bonds that are rated either investment
special risks that pose additional liquidity and default risks. Large grade or below investment grade.
shareholders, including other funds advised by the Adviser, may own a
Funds distributed by Victory Capital Services, Inc., an affiliate of Victory
substantial amount of the Fund’s shares. The actions of large shareholders,
Capital Management Inc.
including large inflows or outflows, may adversely affect other
shareholders, including potentially increasing capital gains. The value of ©2025 Victory Capital Management Inc.
your investment is also subject to geopolitical risks such as wars, terrorism, V19.130 // 4Q 2024 Victory Growth and Tax Strategy Fund COM
environmental disasters, and public health crises; the risk of technology
malfunctions or disruptions; and the responses to such events by
governments and/or individual companies.
The opinions are as of the date noted and are subject to change at any
time due to changes in market or economic conditions. The comments
should not be construed as a recommendation of individual holdings or
market sectors, but as an illustration of broader themes. 2

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