Allworth Financial Dumps 3.19 Million Shares of VictoryShares Free Cash Flow ETF

What happened

On Dec. 2, 2025, Allworth Financial LP disclosed in an SEC filing that it sold 3,192,152 shares of VictoryShares Free Cash Flow ETF (NASDAQ:VFLO) during the third quarter, reducing its position by an estimated $105.3 million.

VictoryShares Free Cash Flow ETF targets U.S. large- and mid-cap equities with strong free cash flow profiles using a rules-based approach. The position now stands at 3,512,017 shares, valued at $131.7 million as of the quarter end.

What else to know

VFLO now represents 0.58% of reported 13F AUM, down from 1.14% in the previous quarter.

The top holdings for Allworth Financial after the filing stand as:

• Vanguard Total Stock Market ETF: $2.78 billion (12.8% of AUM)
• Vanguard Total Bond Market ETF: 1.53 billion (7.0% of AUM)
• Vanguard Short-Term Bond ETF: $1.51 billion (7.0% of AUM)
• SPDR Portfolio Developed World ex-US ETF: $1.27 billion (5.8% of AUM)
• State Street SPDR Portfolio S&P 500 Growth ETF: $1.19 billion (5.5% of AUM)

As of Dec. 1, 2025, VFLO shares were priced at $38.80, representing a 7.99% increase over the past year but underperforming the S&P 500 by 5.52 percentage points.

The ETF's trailing twelve-month dividend yield stands at 1.50%, and shares are 0.73% below their 52-week high.

ETF overview

ETF snapshot

The VictoryShares Free Cash Flow ETF offers investors targeted exposure to 50 large- and mid-cap U.S. companies, screening for free cash flow strength, with the goal of delivering index-tracking returns before fees and expenses. The fund employs a transparent, rules-based selection process and follows a full replication approach to mirror its benchmark index.

The portfolio composition is based on a rules-based methodology, holding all index constituents across diversified sectors, with at least 80% of assets invested in index securities.

The fund is structured as an exchange-traded fund, offering daily liquidity, with an expense ratio embedded in its operations. It is designed for institutional and retail investors seeking exposure to high-free-cash-flow equities.

With a substantial asset base and a focus on shareholder distributions, the VictoryShares Free Cash Flow ETF is positioned as a core holding for investors seeking efficient access to quality U.S. equities with a free cash flow emphasis.

Foolish take

The VictoryShares Free Cash Flow ETF hasn't been a top performer over the past 12 months, with total returns of just 7.9%, compared to the S&P 500's return of 14.4%. It's therefore not surprising to see Allworth cut its stake in the ETF by half.

However, VictoryShares ETF's investment strategy isn't necessarily unsound. The fund begins with the largest of the 400 most profitable U.S. companies and narrows the list down to the top 75 highest free cash flow-yielding value stocks.

It then further selects the top 50 stocks with the highest growth prospects using a combination of sales and EBITDA trends, as well as long-term EPS growth estimates.

Such an investment strategy, with a deep emphasis on its constituents' fundamentals, should bode well for long-term investors. Since its inception in June 2023, the fund has returned 61%, matching the S&P 500's total return over the same time frame.

In a sense, that's commendable since the ETF does not include any of the Magnificent Seven stocks that the S&P 500 boasts. That should give investors an understanding of how good this strategy is over longer investment horizons.
The ETF has an expense ratio of 0.39%. While there are cheaper ETFs to choose from, I'd argue the fund's potential long-term returns should justify its expense ratio.

Despite Allworth Financial reducing its position in the ETF by almost half, VictoryShares is an excellent alternative for long-term investors seeking to invest in solid, free cash flow-generating, growing businesses, without the hard work.

Glossary

ETF (Exchange-Traded Fund): A pooled investment fund traded on stock exchanges, holding assets like stocks or bonds.

AUM (Assets Under Management): The total market value of investments managed by a fund or financial institution.

13F: A quarterly report filed by institutional investment managers disclosing their equity holdings to the SEC.

Dividend yield: Annual dividends paid by an investment, expressed as a percentage of its current price.

Trailing twelve-month: Data covering the most recent 12 consecutive months, often used for performance or yield calculations.

Full replication approach: A fund management method where all securities in the benchmark index are held in the same proportions.

Rules-based methodology: An investment strategy using predefined, systematic criteria to select securities for a portfolio.

Liquidity: How quickly and easily an asset can be bought or sold in the market without affecting its price.

Expense ratio: The annual fee, expressed as a percentage of assets, that a fund charges to cover operating costs.

Index-tracking: An investment strategy aiming to match the performance of a specific market index.

Core holding: A central, long-term investment in a portfolio, intended to provide stability and broad market exposure.

Free cash flow: The cash a company generates after accounting for capital expenditures, available for dividends, debt repayment, or reinvestment.

Isac Simon has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard Bond Index Funds - Vanguard Short-Term Bond ETF, Vanguard Total Bond Market ETF, and Vanguard Total Stock Market ETF. The Motley Fool has a disclosure policy.