Inside GRIN: 5 International Holdings in Victory’s Free Cash Flow ETF

With the S&P 500 Index near record highs, investors worried about U.S. equity valuations peaking can diversify with international equities. To identify value outside of U.S. borders, GRIN tracks an Index that uses a simple yet effective FCF screener.

GRIN tracks the Victory International Free Cash Flow Growth Index (the Index), which focuses on companies with strong FCF metrics. FCF is the cash a company has left after all operating expenses, interest, taxes and CapEx. Because CapEx reduces FCF immediately but does not appear on the income statement, FCF captures capital intensity in a way that earnings may not. With FCF, companies can buy back shares, pay dividends, or invest in the company to build shareholder value. The Index’s methodology extends the FCF approach beyond U.S. equities.

The Index screens constituents on FCF Return on Invested Capital (ROIC): expected FCF divided by invested capital. Expected FCF blends trailing 12-month free cash flow with forward 12-month estimates, giving the Index a forward-looking lens that backward-looking screens lack. The ratio measures how efficiently a company turns capital into spendable cash.

At the end of this strict screening process, the companies left exhibit strong, sustainable cash generation. This quality may enhance portfolio resilience while positioning clients for potential long-term growth. The Index’s approach targets international large-cap growth companies that are profitably growing, because sales growth alone isn’t quality. Quality growth requires that revenue translate into actual cash flow.

These five holdings illustrate the types of businesses the Index’s FCF ROIC screen surfaces: established international companies with efficient capital use and durable cash generation.

1. Siemens Energy AG: As the world shifts toward a decentralized and decarbonized power grid, the Index surfaces companies exposed to grid modernization and energy-transition CapEx. Siemens Energy’s focus on grid technologies and gas services positions the company for this energy transition.
2. ASML Holding N.V.: The lithography giant is a key player in the semiconductor industry as the sole provider of the EUV (Extreme Ultraviolet) machines required to produce the world’s most advanced chips. This position gives the company the potential to maintain high margins and robust cash generation.
3. Tokyo Electron Ltd.: Another major player in the global semiconductor industry, Tokyo Electron provides the essential equipment for wafer processing. As AI-driven demand forces chipmakers to expand capacity globally, Tokyo Electron can benefit from this capacity buildout.
4. Barrick Gold Corp: In the current environment of sticky inflation and geopolitical uncertainty, gold miners may offer a safe haven hedge. Barrick’s operational efficiency and disciplined capital allocation have helped the company generate FCF despite changes in gold prices.
5. Fujikura Ltd.: A leader in optical fibers and electronic components, this company has been one on the forefront of the worldwide 5G rollout and data center expansion. Fujikura’s transition toward higher-value-added products may help fuel its FCF in the future. (Held at a 1.95% weight as of 7/6/2026)

GRIN provides exposure to high-quality international large-cap growth companies selected for FCF strength. For investors looking to diversify their portfolios with an international equity ETF, GRIN may provide a compelling option.

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VettaFi LLC (“VettaFi”) is the index provider for GRIN, for which it receives an index licensing fee. However, GRIN is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of GRIN.

Carefully consider a fund’s investment objectives, risks, charges and expenses before investing. To obtain a prospectus or summary prospectus containing this and other important information, visit vcm.com/prospectus. Read it carefully before investing.

All investing involves risk, including the potential loss of principal.  The Fund has the same risks as the underlying securities traded on the exchange throughout the day. ETFs may trade at a premium or discount to their net asset value. The market prices of securities may go up or down, sometimes rapidly or unpredictably, due to general market conditions, such as real or perceived adverse economic, political, or regulatory conditions, recessions, inflation, or changes in interest or currency rates.   *International investments* can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market, or economic developments and can perform differently from U.S. investments. *Index Funds* invest in securities included in, or representative of securities included in, the Index, regardless of their investment merits. The performance of the Fund may diverge from that of the Index. Investing in companies with high free cash flows could lead to underperformance when such investments are unpopular or during periods of industry disruptions. The Fund could also be affected by company-specific factors that could jeopardize the generation of free cash flow.  *The Fund is new with a limited operating history.* As a result, it does not have a record of performance or other dealings for prospective investors to evaluate when making investment decisions.  *Large shareholders*, including other funds advised by the Adviser, may own a substantial amount of the Fund’s shares. The actions of large shareholders, including large inflows or outflows of cash, may adversely affect other shareholders, including potentially increasing capital gains. The value of your investment is also subject to geopolitical risks such as wars, terrorism, trade disputes, 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 Victory International Free Cash Flow Growth Index measures the performance of profitable companies in the developed world, excluding the United States, that generate high free cash flow yield and higher growth characteristics. The indices are subject to sector country and individual security weight constraints. Constituents are weighted by free cash flow modified absolute momentum.

VictoryShares ETFs distributed by Victory Capital Services, Inc. (VCS). VCS is not affiliated with VettaFi.

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