May 1, 2022
Prospectus
USAA Extended Market Index Fund
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Fund Shares |
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USMIX |
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USAA 500 Index Fund
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Member Shares |
Reward Shares |
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USSPX |
USPRX |
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USAA Nasdaq-100 Index Fund
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Fund Shares |
Institutional
Shares |
Class A |
Class C |
R6 Shares |
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USNQX |
UINQX |
UANQX |
UCNQX |
URNQX |
Victory Capital means Victory Capital Management Inc., the investment adviser of the USAA Mutual Funds. USAA Mutual Funds are distributed by Victory Capital Services, Inc., member FINRA, an affiliate of Victory Capital. Victory Capital and its affiliates are not affiliated with United Services Automobile Association or its affiliates. USAA and the USAA logos are registered trademarks and the USAA Mutual Funds and USAA Investments logos are trademarks of United Services Automobile Association and are being used by Victory Capital and its affiliates under license.
The Securities and Exchange Commission has not approved or disapproved these securities or determined whether this Prospectus is accurate or complete. Any representation to the contrary is a criminal offense.
www.vcm.com
(800) 235-8396
TABLE OF CONTENTS
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25 |
(fees paid directly from your investment)
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Management Fee |
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Distribution and/or Service (12b-1) Fees |
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Other Expenses |
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Acquired Fund Fees and Expenses |
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Total Annual Fund Operating Expenses |
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1The total annual operating expenses for the Fund may not correlate to the ratio of expenses to average daily net assets shown in the financial highlights, which reflect the operating expenses of the Fund and do not include acquired fund fees and expenses.
2Victory Capital Management Inc. (the “Adviser”) has contractually agreed to waive fees and/or reimburse expenses so that the total annual operating expenses (excluding acquired fund fees and expenses, interest, taxes, brokerage commissions, capitalized expenses, and other extraordinary expenses) do not exceed 0.43% of the Fund through at least June 30, 2023 . The Adviser is permitted to recoup fees waived and expenses reimbursed for up to three years after the date of the waiver or reimbursement, subject to the lesser of any operating expense limits in effect at the time of: (a) the original waiver or expense reimbursement; or (b) the recoupment, after giving effect to the recoupment amount. This agreement may only be terminated by the Fund’s Board of Trustees.
Prospectus | 1
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1 Year |
3 Years |
5 Years |
10 Years |
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$ |
$ |
$ |
$ |
2 | USAA Index Funds
Prospectus | 3
4 | USAA Index Funds
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1 Year |
5 Years |
10 Years |
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Fund Shares |
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Return Before Taxes |
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Return After Taxes on Distributions |
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Return After Taxes on Distributions and Sale of Fund
Shares |
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Index | |||
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Wilshire 4500 Completion Index (reflects no deduction for
fees, expenses, or taxes) |
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Prospectus | 5
Management of the Fund
Investment Adviser
Victory Capital Management Inc. (the “Adviser”) serves as the Fund’s investment adviser.
The Adviser is a diversified global asset manager comprised of multiple investment teams, referred to as investment franchises, each of which utilizes an independent approach to investing. The portfolio manager primarily responsible for the day-to-day management of the Fund is a member of the Adviser’s Victory Solutions platform.
Portfolio Manager
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Title |
Tenure with
the Fund |
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Mannik S. Dhillon,
CFA, CAIA |
President, VictoryShares and Solutions |
Since 2019 |
Purchase and Sale of Shares
You may purchase or sell shares of the Fund on any business day through VictoryFunds.com or by telephone at (800) 235-8396. You also may purchase or sell shares of the Fund through certain other financial intermediaries. If you have opened an account directly with the Fund, you also may purchase and sell shares of the Fund by mail at P.O. Box 182593, Columbus, Ohio 43218-2593. The Fund reserves the right to waive or lower purchase minimums in certain circumstances.
◾Minimum initial purchase: $3,000
◾Minimum subsequent investment: $50
Tax Information
The Fund intends to make distributions that generally will be taxed to you as ordinary income or long-term capital gains, unless you are a tax-exempt investor or you invest through an IRA, 401(k) plan, or other tax-deferred account (in which case you may be taxed later, upon withdrawal of your investment from such account).
6 | USAA Index Funds
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of such shares and certain servicing and administrative functions. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your financial adviser to recommend the Fund over another investment. Ask your financial adviser or visit your financial intermediary’s website for more information.
Prospectus | 7
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Member
Shares |
Reward
Shares |
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Account Maintenance Fee (for Fund account balances
below $10,000) |
$ |
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Member
Shares |
Reward
Shares |
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Management Fee |
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Distribution and/or Service (12b-1) Fees |
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Other Expenses |
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Total Annual Fund Operating Expenses |
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Fee Waiver/Reimbursement from Adviser |
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( |
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Total Annual Fund Operating Expenses after
Reimbursement |
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1Victory Capital Management Inc. (the “Adviser”) has contractually agreed to waive fees and/or reimburse expenses so that the total annual operating expenses (excluding acquired fund fees and expenses, if any, interest, taxes, brokerage commissions, capitalized expenses, and other extraordinary expenses) do not exceed 0.25% of the Fund’s Member Shares and 0.15% of the Fund’s Reward Shares, through at least June 30, 2023 . The Adviser is permitted to recoup fees waived and expenses reimbursed for up to three years after the date of the waiver or
8 | USAA Index Funds
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1 Year |
3 Years |
5 Years |
10 Years |
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Member Shares |
$ |
$ |
$ |
$ |
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Reward Shares |
$ |
$ |
$ |
$ |
Prospectus | 9
10 | USAA Index Funds
Prospectus | 11
12 | USAA Index Funds
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Prospectus | 13
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1 Year |
5 Years
(or Life
of Class) |
10 Years
(or Life
of Class) |
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Member Shares |
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Return Before Taxes |
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Return After Taxes on Distributions |
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Return After Taxes on Distributions and Sale of Fund
Shares |
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Reward Shares |
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Return Before Taxes |
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Indexes | |||
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Victory US Large Cap 500 Index (reflects no deduction
for fees, expenses, or taxes) |
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S&P 500® Index (reflects no deduction for fees,
expenses, or taxes) |
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* Excludes $10 account maintenance fee, which is waived for accounts of $10,000 or more.
Management of the Fund
Investment Adviser
Victory Capital Management Inc. (the “Adviser”) serves as the Fund’s investment adviser.
The Adviser is a diversified global asset manager comprised of multiple investment teams, referred to as investment franchises, each of which utilizes an independent approach to investing. The portfolio manager primarily responsible for the day-to-day management of the Fund is a member of the Adviser’s Victory Solutions platform.
Portfolio Manager
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Title |
Tenure with
the Fund |
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Mannik S. Dhillon,
CFA, CAIA |
President, VictoryShares and Solutions |
Since 2019 |
14 | USAA Index Funds
Purchase and Sale of Shares
You may purchase or sell shares of the Fund on any business day through VictoryFunds.com or by telephone at (800) 235-8396. You also may purchase or sell shares of the Fund through certain other financial intermediaries. If you have opened an account directly with the Fund, you also may purchase and sell shares of the Fund by mail at P.O. Box 182593, Columbus, Ohio 43218-2593. The Fund reserves the right to waive or lower purchase minimums in certain circumstances.
Member Shares:
The minimum initial purchase is $3,000. The minimum subsequent investment is $50.
Reward Shares:
The minimum initial purchase is $100,000 for new investors; or shares of the Fund held through a discretionary managed account program. The minimum subsequent investment is $50.
Tax Information
The Fund intends to make distributions that generally will be taxed to you as ordinary income or long-term capital gains, unless you are a tax-exempt investor or you invest through an IRA, 401(k) plan, or other tax-deferred account (in which case you may be taxed later, upon withdrawal of your investment from such account).
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of such shares and certain servicing and administrative functions. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your financial adviser to recommend the Fund over another investment. Ask your financial adviser or visit your financial intermediary’s website for more information.
Prospectus | 15
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Fund
Shares |
Inst.
Shares |
Class A |
Class C |
R6
Shares |
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Maximum Sales Charge
(load) Imposed on
Purchases (as a percentage
of offering price) |
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Maximum Deferred Sales
Charge (load)
(as a percentage of the
lower of purchase or sales
price) |
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16 | USAA Index Funds
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Fund
Shares |
Inst.
Shares |
Class A |
Class C |
R6
Shares |
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Management Fee |
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Distribution and/or Service
(12b-1) Fees |
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Other Expenses |
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Total Annual Fund
Operating Expenses |
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Fee
Waiver/Reimbursement
from Adviser |
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( |
( |
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Total Annual Fund
Operating Expenses after
Reimbursement |
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3 Victory Capital Management Inc. (the “Adviser”) has contractually agreed to waive fees and/or reimburse expenses so that the total annual operating expenses (excluding acquired fund fees and expenses, if any, interest, taxes, brokerage commissions, capitalized expenses, and other extraordinary expenses) do not exceed an annual rate of 0.48% of the Fund Shares, 0.44% of Institutional Shares, 0.70% of Class A shares, 1.45% of Class C shares, and 0.40% of the R6 Shares, through at least June 30, 2023 . The Adviser is permitted to recoup fees waived and expenses reimbursed for up to three years after the date of the waiver or reimbursement, subject to the lesser of any operating expense limits in effect at the time of: (a) the original waiver or expense reimbursement; or (b) the recoupment, after giving effect to the recoupment amount. This agreement may only be terminated by the Fund’s Board of Trustees.
Prospectus | 17
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1 Year |
3 Years |
5 Years |
10 Years |
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Fund Shares |
$ |
$ |
$ |
$ |
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Inst. Shares |
$ |
$ |
$ |
$ |
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Class A |
$ |
$ |
$ |
$ |
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Class C
(If you sell your shares at the
end of the period.) |
$ |
$ |
$ |
$ |
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Class C
(If you do not sell your shares at
the end of the period.) |
$148 |
$621 |
$1,135 |
$2,549 |
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R6 Shares |
$ |
$ |
$ |
$ |
18 | USAA Index Funds
Prospectus | 19
20 | USAA Index Funds
Prospectus | 21
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22 | USAA Index Funds
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1 Year |
5 Years
(or Life
of Class) |
10 Years
(or Life
of Class) |
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Fund Shares |
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Return Before Taxes |
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Return After Taxes on Distributions |
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Return After Taxes on Distributions and Sale of Fund
Shares |
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Institutional Shares |
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Return Before Taxes |
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Class A |
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Return Before Taxes |
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Class C |
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Return Before Taxes |
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R6 Shares |
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Return Before Taxes |
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Indexes | |||
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Nasdaq-100 Index (reflects no deduction for fees,
expenses, or taxes) |
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Russell 1000® Growth Index (reflects no deduction for
fees, expenses, or taxes) |
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*Inception date of R6 Shares is March 1, 2017. Inception date of Institutional Shares, Class A, and Class C is June 29, 2020.
Management of the Fund
Investment Adviser
Victory Capital Management Inc. (the “Adviser”) serves as the Fund’s investment adviser.
The Adviser is a diversified global asset manager comprised of multiple investment teams, referred to as investment franchises, each of which utilizes an independent approach to investing. The portfolio manager primarily responsible for the day-to-day management of the Fund is a member of the Adviser’s Victory Solutions platform.
Prospectus | 23
Portfolio Manager
|
|
Title |
Tenure with
the Fund |
|
Mannik S. Dhillon,
CFA, CAIA |
President, VictoryShares and Solutions |
Since 2019 |
Purchase and Sale of Shares
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Investment
Minimums |
Fund
Shares |
Inst.
Shares |
Class A |
Class C |
R6
Shares |
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Minimum Initial Investment |
$3,000 |
$1,000,000 |
$2,500 |
$2,500 |
None |
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Minimum Subsequent
Investments |
$50 |
None |
$50 |
$50 |
None |
You may purchase or sell Fund Shares on any business day through VictoryFunds.com or by telephone at (800) 235-8396. You also may purchase or sell Fund Shares through certain other financial intermediaries. If you have opened an account directly with the Fund, you also may purchase and sell Fund Shares by mail at P.O. Box 182593, Columbus, OH 43210-2593. The Fund reserves the right to waive or lower purchase minimums in certain circumstances.
Institutional Shares are not offered for sale directly to the general public. The Fund reserves the right to waive or lower purchase minimums in certain circumstances.
For Class A and Class C shares, a $1,000 minimum initial purchase amount and a $50 minimum subsequent purchase amount apply for Individual Retirement Accounts (“IRAs”), gift/transfer to minor accounts, and purchases through automatic investment plans.
Certain broker-dealers and other financial intermediaries (such as a bank) may establish higher or lower minimum initial and subsequent investment amounts to which you may be subject if you invest through them.
R6 Shares generally are available only through employer-sponsored retirement plans where a financial intermediary provides retirement recordkeeping services to plan participants. R6 Shares also are available to endowment funds and foundations. Please contact your plan administrator or recordkeeper to purchase or sell (redeem) shares from your retirement plan.
When you buy and redeem shares, the Fund will price your transaction at the next-determined net asset value (“NAV”) after the Fund receives your request in good order, which means that your request contains all the required documentation, and that all documents contain required signatures or signature guarantees from a financial institution.
24 | USAA Index Funds
Tax Information
The Fund intends to make distributions that generally will be taxed to you as ordinary income or long-term capital gains, unless you are a tax-exempt investor or you invest through an IRA, 401(k) plan, or other tax-deferred account (in which case you may be taxed later, upon withdrawal of your investment from such account).
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of such shares and certain servicing and administrative functions for investments in all share classes except the R6 Shares. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your financial adviser to recommend the Fund over another investment. Ask your financial adviser or visit your financial intermediary’s website for more information.
Prospectus | 25
Victory Capital Management Inc. (“Victory Capital” or “Adviser”) manages these Funds. For easier reading, Victory Capital may be referred to as “we” or “us” throughout the prospectus.
Investment Objective
As described in this Prospectus, each Fund has its own investment objective, policies, and strategies. There is no assurance that a Fund will achieve its investment objective. The investment objective of each Fund may be changed without shareholder approval. Except as otherwise noted, the investment policies and strategies of a Fund are not fundamental policies and may be changed without a shareholder vote.
Overview of Index Funds
◼ What are index funds?
Index funds are mutual funds that attempt to track the performance of a specific index. An index is an unmanaged group of securities whose overall performance is used as a standard to measure investment performance of a particular market. It is a passive measure of stock market returns. It does not factor in the costs of buying, selling, and holding stocks, which are reflected in a fund’s performance. In this prospectus, we offer you a choice of three index funds that provide you a convenient and cost-efficient means of investing in a portfolio that generally reflects the performance of some portion of the stock market. An index fund has operating expenses and transaction costs, while the market index does not. Keep in mind that the target index is a model, not an actual portfolio, and you cannot invest directly in an index. Therefore, while a fund attempts to track its target index as closely as possible, it typically will not match the performance of the index exactly.
A Brief Description of the Indices
◼ What is the Wilshire 4500 Completion Index?
The Wilshire 4500 Completion Index is a market cap-weighted index consisting of the small and mid-cap companies in the U.S. equity market. It consists of the securities within the Wilshire 5000 Total Market Index (“Parent Index”) after eliminating the companies included in the S&P 500 Index. The Parent Index measures performance of all U.S. equity securities with readily available price data. The number of securities in the Wilshire 4500 Completion Index fluctuates and may be more or less than 4,500. As of March 31, 2022, the market capitalization range of the companies included in the Wilshire 4500 Completion Index was between $781 billion and less than $2 million. The size of company in the Wilshire 4500 Completion Index changes with market conditions and the composition of the Wilshire 4500
26 | USAA Index Funds
Completion Index. See Additional Information on the Wilshire 4500 Completion Index for further information.
◼ What is the Victory US Large Cap 500 Index?
The Victory US Large Cap 500 Index is a custom index published by Wilshire Associates Incorporated. Each stock in the index contributes to the index in the same proportion as the value of its shares. The index is rebalanced semi-annually. Securities that no longer meet eligibility for the Index upon rebalancing are omitted. A security also may be removed from the index in between rebalancing if it no longer represents an investable asset due to legal constraints or other independent factors.
◼ What is the Nasdaq-100 Index?
The Nasdaq-100 Index is an index composed of 100 of the largest nonfinancial domestic and international companies listed on The Nasdaq Stock Market based on market capitalization. The index reflects companies across major industry groups including, computer hardware and software, telecommunications, retail/wholesale trade, and biotechnology. It does not contain financial companies, including investment companies. The index may include one or more depositary receipts representing a security of a non-U.S. issuer. See Additional Information on the Nasdaq-100 Index for further information.
The Basics of Index Investing
◼ How are the Funds' portfolios managed?
Index funds are not managed according to traditional methods of “active” investment management, which involve the buying and selling of securities based upon economic, financial, and market analyses and investment judgment. Instead, index funds utilize a “passive” or “indexing” investment approach in an attempt to match, as closely as possible, the performance of the relevant index.
The Funds generally seek to track the returns of their respective index before fees and expenses by employing a full replication strategy that seeks to hold all the stocks in that index. For the USAA Extended Market Index Fund, the Adviser may choose instead to select a representative sample of stocks from the targeted index that will resemble the full index in terms of industry weightings, market capitalization, price/earnings ratios, dividend yield, and other characteristics. For example, if 10% of an index was made up of technology stocks, the Fund would invest approximately 10% of its assets in some, but not all, of the technology stocks included in that index. This approach generally is less expensive than buying and holding all of the stocks in a particular index but may result in greater tracking error when compared to a full replication strategy.
Prospectus | 27
The ability of the Fund to replicate the total return of the index may be affected by, among other things, transaction costs, administrative expenses, taxes, changes in the composition of the index or the assets of the Fund, the timing and amount of investors’ contributions and withdrawals, and other fees and expenses borne by the Fund.
◼ As an investor, what are the benefits of using a passive or indexing approach?
Indexing may appeal to many investors because it provides simplicity through a straightforward market-matching strategy and may provide diversification by investing in a wide variety of companies and industries. Indexing tends to involve lower costs than actively managed funds because index funds do not have many of the expenses of actively managed funds such as research, and usually have relatively low trading activity, so total brokerage commissions tend to be lower.
◼ How closely will the Funds match their respective indices?
In seeking to track the performance of a Fund's respective index, each Fund will attempt to allocate the investments of the Fund among stocks in approximately the same weightings as the respective index, beginning with the stocks that make up the larger portion of the index’s value.
Over the long term (i.e., periods of three to five years), each Fund will seek a correlation between the performance of the Fund, before fees and expenses, and that of the respective index of 0.95 or better. A figure of 1.00 would indicate perfect correlation, meaning that the Fund always moves up in value when a Fund's respective index rises and down in value when the index declines. In the event that the targeted correlation is not achieved, alternative structures may be considered.
◼ Will the Funds purchase other types of securities?
Under normal market conditions, each Fund’s assets generally will be invested in stocks included in its respective index. However, each Fund may hold up to 20% of its assets in short-term debt securities, money market instruments, stock index futures, and options, in most cases to provide liquidity to pay redemptions and fees. In addition, each Fund may lend securities with a value up to 33 1/3% of its total assets.
Each Fund may invest in derivative instruments, and may at times invest a significant portion of its assets in futures contracts linked to the performance of the index or other indices that are highly correlated with the index. Derivatives allow the Fund to increase or decrease its exposure to the index quickly and at less cost than buying or selling stocks. Each Fund may invest in options, futures, and other derivative instruments in order to gain market exposure quickly in the event of subscriptions, to maintain liquidity in the event of redemptions, and to keep trading costs low. Each Fund also may purchase exchange-traded funds (“ETFs”).
28 | USAA Index Funds
Each Fund generally will invest in stock index futures and options in an attempt to reduce any performance discrepancies between the Fund and its respective index. Each Fund generally will not use these derivative instruments for speculative purposes or as leveraged investments that magnify the gains or losses of an investment. These investments tend to reduce transaction costs or add value when they are favorably priced.
Risks
The following provides additional information about the Funds' principal risks and supplements those risks discussed in the Funds' Summary section of this prospectus.
Market Risk: The Funds are subject to market risk, which is the risk that the securities markets will move down, sometimes rapidly and unpredictably, based on overall economic conditions and other factors. Changes in the financial condition of a single issuer can impact a market as a whole and adverse market conditions may be prolonged and may not have the same impact on all types of securities. In addition, markets and market-participants are increasingly reliant upon both publicly available and proprietary information data systems. Data imprecision, software or other technology malfunctions, programming inaccuracies, unauthorized use or access, and similar circumstances may impair the performance of these systems and may have an adverse impact upon a single issuer, a group of issuers, or the market at large. In certain cases, an exchange or market may close or issue trading halts on either specific securities or even the entire market, which may result in the Fund being, among other things, unable to buy or sell certain securities or financial instruments or accurately price its investments.
Market turmoil may be reflected in perceptions of economic uncertainty, price volatility in the equity and debt markets, and fluctuating trading liquidity. In response, governments may adopt a variety of fiscal and monetary policy changes, including but not limited to, direct capital infusions into companies, new monetary programs, and lower interest rates. An unexpected or quick reversal of these policies could increase volatility in the equity and debt markets. Market conditions and economic risks could have a significant effect on domestic and international economies, and could add significantly to the risks of increased volatility and decreased liquidity for the Funds' portfolio. Equity securities tend to be more volatile than debt securities.
◾Information Technology and Operations Risk: Markets and market participants are increasingly reliant upon both publicly available and proprietary information data systems. Data imprecision, software or other technology malfunctions, programming inaccuracies, unauthorized use or access, and similar circumstances may impair the performance of these systems and may have an adverse impact upon a single issuer, a group of issuers, or the market at large. The information technology and other operational systems upon which a
Prospectus | 29
Fund’s service providers rely may be subject to cyber attack or other technological disruptions, and could otherwise disrupt the ability of these service providers to perform essential tasks for the Funds. In certain cases, an exchange or market may close or issue trading halts on either specific securities or even the entire market, which may result in a Fund being, among other things, unable to buy or sell certain securities or financial instruments or accurately price its investments.
◾Geopolitical/Natural Disaster Risk: Global economies and financial markets are increasingly interconnected, which increases the possibilities that conditions in one country or region might adversely affect issuers in another country or region. Geopolitical and other risks, including war, terrorism, trade disputes, political or economic dysfunction within some nations, public health crises and related geopolitical events, as well as environmental disasters such as earthquakes, fires, and floods, may add to instability in world economies and markets generally. Changes in trade policies and international trade agreements could affect the economies of many countries in unpredictable ways. Epidemics and/or pandemics, such as the coronavirus (or “COVID-19”), may result in, among other things, closing borders, disruptions to healthcare service preparation and delivery, quarantines, cancellations, disruptions to supply chains and consumer activity, as well as general concern and uncertainty. The impact may be short-term or may last for extended periods.
The COVID-19 pandemic, which has spread rapidly across the world, has led and will continue to lead for an unknown period of time to disruptions in local, regional, national and global markets and economies. The outbreak has resulted in, and until fully resolved is likely to continue to result in, among other things (1) government imposition of various forms of “stay at home” orders and the closing of “non-essential” businesses, resulting in significant disruption to the businesses of many issuers as well as lay-offs of employees; (2) increased requests by issuers of debt instruments for amendments and waivers of agreements to avoid default and increased defaults; (3) volatility and disruption of markets, including greater volatility in pricing and spreads; and (4) rapidly evolving proposals and/or actions by state and federal governments to address problems being experienced by the markets and by businesses and the economy in general.
Foreign Investing Risk: Because the USAA 500 Index Fund and USAA Nasdaq-100 Index Fund may invest in securities of foreign issuers, it is subject to the risks of foreign investing. These risks include currency exchange rate fluctuations; foreign market illiquidity; emerging-market risk; increased price volatility; uncertain political conditions; exchange-control
30 | USAA Index Funds
regulations; foreign ownership limits; different accounting, reporting, and disclosure requirements; difficulties in obtaining legal judgments; and foreign withholding taxes.
Small- and Mid-Capitalization Company Risk: The USAA Extended Market Index Fund is subject to small- and mid-capitalization company risk. Small- and mid-cap companies may be more vulnerable than larger companies to adverse business or economic conditions. These companies also may have limited product lines, markets, or financial resources, and can be particularly sensitive to interest rates, borrowing costs, and earnings. Securities of such companies may be less liquid and more volatile than securities of larger companies or the market in general and, therefore, may involve greater risk than investing in securities of larger companies. In addition, small- and mid-cap companies may not be well known to the investing public, may not have institutional ownership, and may have only cyclical, static, or moderate growth prospects. Investing more heavily in one market capitalization (large, medium, or small) carries the risk that due to market conditions, that market capitalization sector may underperform the others.
Large-Capitalization Company Risk: Investments in large-capitalization companies may go in and out of favor based on market and economic conditions and may underperform other market segments. Some large-capitalization companies may be unable to respond quickly to new competitive challenges and attain the high growth rate of successful smaller companies, especially during extended periods of economic expansion. As such, returns on investments in stocks of large-capitalization companies could trail the returns on investments in stocks of small- and mid-capitalization companies.
Sector Risk: The USAA 500 Index Fund and USAA Nasdaq-100 Index Fund are subject to sector risk. The returns from a specific type of security may trail returns from other asset classes or the overall market. For example, the stocks that make up the index currently are heavily weighted in the technology sectors. Technology companies may be particularly vulnerable to factors affecting the technology sector, such as dependency on consumer and business acceptance as new technology evolves, large and rapid price movements resulting from competition, rapid obsolescence of products and services, and short product cycles. Many technology companies are small and at an earlier stage of development and, therefore, may be subject to risks such as those arising out of limited product lines, markets, and financial and managerial resources. High volatility or poor performance of the sectors will directly affect the Fund’s performance. Sectors will go through cycles of doing better or worse than stocks or bonds in general. These periods may last for several years.
Non-Diversification Risk: The USAA Nasdaq-100 Index Fund is non-diversified, which means that it may invest a greater percentage of its assets in a single issuer or a limited number of issuers, such as a single stock or bond. Because a relatively high percentage of the Fund’s total assets may
Prospectus | 31
be invested in the securities of a single issuer or a limited number of issuers, the Fund’s portfolio may be more sensitive to changes in the market value of these securities. Such a focused investment strategy may increase the volatility of the Fund’s investment results, because this Fund may be more susceptible to risks associated with a single issuer or economic, political, or regulatory events than a diversified fund.
Index Risk: Each Fund attempts to track the performance of its respective index. The Fund’s performance will be negatively affected by general declines in the securities and asset classes represented in the index. In addition, because a Fund is not actively managed, unless a specific security is removed from its index, the Fund generally will not sell a security because the security’s issuer was in financial trouble. The Fund also does not attempt to take defensive positions under any market conditions, including declining markets. Therefore, the Fund’s performance could be lower than funds that may actively shift their portfolio assets to take advantage of market opportunities or to lessen the impact of a market decline or a decline in the value of one or more issuers.
Tracking Error Risk: While each Fund attempts to match its respective index as closely as possible, the ability of the Fund to meet its investment objective depends to some extent on the cash flow in and out of the Fund. Each Fund’s performance may be affected by factors such as the size of the Fund’s portfolio, transaction costs, management fees and expenses, and brokerage commissions and fees. When a shareholder buys or sells shares of a Fund, the Fund generally has to buy or sell stocks in its portfolio. Changes in a Fund’s cash flow affect how closely the Fund will track its respective index. Because of the differences between the index and a Fund’s portfolio, a Fund may not track its respective index perfectly. If a Fund uses representative sampling to track its Index, this may cause the tracking error to be higher than would be the case if the Fund purchased all of the securities in the Index.
Large Shareholder Risk: Each Fund, like all mutual funds, pools the investments of many investors. Actions by one shareholder or multiple shareholders may have an impact on a Fund and, therefore, indirectly on other shareholders. For example, significant levels of new investments in a Fund by shareholders may cause a Fund to have more cash than would otherwise be the case, which might have a positive or negative impact on Fund performance. Similarly, redemption activity might cause a Fund to sell portfolio securities, which may increase transaction costs and might generate a capital gain or loss, or cause it to borrow funds on a short-term basis to cover redemptions, which would cause a Fund to incur costs that, in effect, would be borne by all shareholders, not just the redeeming shareholders. Shareholder purchase and redemption activity also may affect the per share amount of a Fund’s distributions of its net investment income and net realized capital gains, if any, thereby affecting the tax burden on a Fund’s shareholders subject to federal income tax. To the extent a larger shareholder (including,
32 | USAA Index Funds
for example, an affiliated fund that operates as a fund-of-funds or 529 education savings plan) is permitted to invest in a Fund, a Fund may experience large inflows or outflows of cash from time to time. This activity could magnify these adverse effects on a Fund.
Derivatives Risk: A Fund may invest in futures, options, swaps, and other types of derivatives. Risks associated with derivatives include the risk that the derivative is not well-correlated with the security, index, exchange-traded funds (“ETFs”), or currency to which it relates; the risk that derivatives used for risk management may not have the intended effects and may result in losses, underperformance, or missed opportunities; the risk that a Fund will be unable to sell the derivative because of an illiquid secondary market; the risk that a counterparty is unwilling or unable to meet its obligation; the risk of interest rate movements; and the risk that the derivatives transaction could expose a Fund to the effects of leverage, which could increase a Fund’s market exposure, magnify investment risks and losses, and cause losses to be realized more quickly. In addition, proposed and current regulation may limit a Fund’s ability to invest in derivatives. There is no guarantee that derivative techniques will be employed or that they will work as intended, and their use could lower returns or even result in losses to a Fund. In addition, proposed and current regulations may limit the Fund’s ability to invest in derivatives.
ETF Risk: ETFs, which generally are registered investment companies, incur their own management fees and other expenses, such as trustees’ fees, operating expenses, registration fees, and marketing expenses, a proportionate share of which would be borne by the Fund. As a result, an investment by a Fund in an ETF could cause the Fund’s operating expenses to be higher and, in turn, its performance to be lower than if it were to invest directly in the securities held by the ETF. In addition, the Fund will be exposed indirectly to all of the risks of the securities held by the ETFs.
Passive ETFs that invest in the securities and sectors contained in the indexes they seek to track do not attempt to take defensive positions in volatile or declining markets or under other conditions. Furthermore, such ETFs will be unable to duplicate exactly the performance of the underlying indexes they track.
The price of an ETF is determined by supply and demand. Thus, ETFs do not necessarily trade at their net asset value (“NAV”), which means their shares may trade at a premium or discount.
In addition, although ETFs generally are listed on securities exchanges, there can be no assurances that an ETF will continue to satisfy the listing qualifications or that an active trading market for such ETFs will be maintained. Secondary market trading in ETFs also may be halted by a national securities exchange because of market conditions or for other reasons.
Futures and Options Risk: Risks associated with investments in futures and options include the risk that the futures or options contract will not fully offset the underlying position and that the investments in futures and options
Prospectus | 33
used for risk management may not have the intended effects and may result in losses or missed opportunities. The risk of loss of money from futures contracts and options on futures contracts used for non-hedging purposes may be greater than that of investments for hedging purposes.
Leveraging Risk: The USAA Extended Market Fund is subject to leveraging risk. Leveraging risk is the risk associated with securities or practices that multiply small price movements into large changes in value. The more a Fund invests in leveraged instruments or strategies that use leveraged instruments, the more this leverage will magnify any losses on those investments.
Liquidity Risk: Certain securities held by a Fund may be difficult (or impossible) to sell at the time and at the price a Fund would like due to a variety of factors, including general market conditions, the perceived financial strength of the issuer, or specific restrictions on resale of the securities. Consequently, a Fund may have to hold these securities longer than it would like and may forgo other investment opportunities. It also is possible that a Fund could be prevented from realizing capital gains or could be forced to incur capital losses if the Adviser is unable to sell a position at the time or price of the Adviser’s choosing. Lack of liquidity may impact valuation of such securities and a Fund’s NAV adversely, especially during times of financial distress. In addition, a Fund may not be able to raise cash when needed or may be forced to sell other investments to raise cash, which could impact a Fund’s performance negatively. Infrequent trading of securities also may lead to an increase in price volatility. Liquidity is a general investment risk that potentially could impact any security, but funds that invest in privately-placed securities, certain small-company securities, high-yield bonds, mortgage-backed or asset-backed securities, foreign or emerging-market securities, derivatives, or other structured investments, which all have experienced periods of illiquidity, generally are subject to greater liquidity risk than funds that do not invest in these types of securities.
Additional Risk Factors. The Adviser may use several types of investment strategies in pursuing the Funds' overall investment objective. The following risks are those that the Adviser does not consider to be principal risks of the Fund. The SAI provides more detail about these risks and other risks that the Fund may be subject to that are not considered to be principal risks. You may request a copy of the Funds' SAI for more information.
Securities Lending Risk: Each Fund may lend portfolio securities to broker-dealers or other institutions on a fully collateralized basis. There is a risk of delay in recovering a loaned security and/or risk of loss in collateral if the borrower becomes insolvent. There also is risk of loss if the borrower defaults and fails to return the loaned securities. Each Fund could incur losses on the reinvestment of cash collateral from the loan, if the value of the short-term investments acquired with the cash collateral is less than the amount of cash collateral required to be returned to the borrower.
34 | USAA Index Funds
Organization and
Management of the Fund
Management of the Fund
The Funds' Board has the overall responsibility for overseeing the management of the Funds.
The Investment Adviser
Victory Capital Management Inc. (the “Adviser”), a New York corporation that is registered as an investment adviser with the Securities and Exchange Commission (“SEC”), serves as the investment adviser to the Funds pursuant to an investment advisory agreement. Subject to the authority of the Board, the Adviser is responsible for the overall management and administration of the Funds' business affairs. The Adviser is responsible for selecting the Funds investments according to its investment objective, policies, and restrictions. As of March 31, 2022, the Adviser managed and advised assets totaling in excess of $178.1 billion for individual and institutional clients. The Adviser’s principal address is 15935 La Cantera Pkwy, San Antonio, Texas 78256.
A discussion regarding the basis of the Board’s approval of the Funds' Advisory Agreement is available in the Funds' most recent annual report to shareholders for the period ended December 31.
The Adviser is a diversified global asset manager comprised of multiple investment teams, referred to as investment franchises, each of which utilizes an independent approach to investment. Victory Capital’s Victory Solutions platform oversees the rules-based investment strategies and is responsible for the day-to-day investment management of the Funds.
With respect to the USAA Extended Market Index Fund, the Fund pays the Adviser an investment management fee, which is accrued daily and paid monthly, equal to an annualized rate of 0.10% of average daily net assets.
With respect to the USAA 500 Index Fund, the Fund pays the Adviser an investment management fee, which is accrued daily and paid monthly, equal to an annualized rate of 0.10% of average daily net assets.
With respect to the USAA Nasdaq-100 Index Fund, the Fund pays the Adviser an investment management fee, which is accrued daily and paid monthly, equal to an annualized rate of 0.20% of average daily net assets.
See Fund Fees and Expenses in this prospectus for information about any contractual agreement agreed to by the Adviser to waive fees and/or reimburse expenses with respect to the Funds. From time to time, the Adviser also may voluntarily waive fees and/or reimburse expenses in amounts exceeding those required to be waived or reimbursed under any contractual agreement that may be in place with respect to the Funds.
Each Fund is authorized, although the Adviser has no present intention of utilizing such authority, to use a “manager-of-managers” structure. The
Prospectus | 35
Adviser could select (with approval of the Board and without shareholder approval) one or more subadvisers to manage the day-to-day investment of the Funds' assets. The Adviser would monitor each subadviser’s performance through quantitative and qualitative analysis and periodically report to the Board as to whether a subadviser’s agreement should be renewed, terminated, or modified. The Adviser also would be responsible for determining how the Funds' assets should be allocated to the subadvisers. The allocation for a subadviser could range from 0% to 100% of the Funds' assets, and the Adviser could change the allocations without shareholder approval.
Portfolio Management
Mannik S. Dhillon, CFA, CAIA, President, VictoryShares and Solutions, has managed each Fund since 2019. Mr. Dhillon served as Victory Capital’s Head of Investment Solutions, Product, and Strategy from 2015-2017. He served as a managing director and head of manager research with Wilshire Associates, where he evaluated asset managers and led strategic consulting engagements from 2010-2015. He is a Chartered Financial Analyst (“CFA”) and Chartered Alternative Investment Analyst (“CAIA”).
The SAI provides additional information about the portfolio manager's compensation, other accounts managed, and ownership of Fund securities.
Investing with the
USAA Mutual Funds
USAA Mutual Funds
If you are looking for a convenient way to open an account or to add money to an existing account, we can help. The sections that follow will serve as a guide to your investment with the USAA Mutual Funds. These sections describe many of the share classes currently offered by the USAA Mutual Funds. Choosing a Share Class will help you decide which share class may be to your advantage to buy.
Keep in mind that Institutional Shares and R6 Shares are available for purchase only by eligible shareholders. In addition, not all USAA Mutual Funds offer each class of shares described below; and therefore, certain classes may be discussed that are not necessarily offered by a Fund. The classes of shares that are offered by a Fund are those listed on the cover page designated with a ticker symbol. A Fund also may offer other share classes in different prospectuses.
This section of the prospectus also describes how to open an account, how to access information about your account, and how to buy, exchange, and sell shares of a Fund. Note, this information may vary if you invest through a third party such as a brokerage firm and will be dependent on that firm’s policies and practices. Consult your Investment Professional for specific details. An Investment Professional is an investment consultant, salesperson, financial planner, investment adviser, or trust officer who provides you with
36 | USAA Index Funds
investment information. Your Investment Professional also can help you decide which share class is best for you. Investment Professionals and other financial intermediaries may charge fees for their services.
We want to make it simple for you to do business with us. If you have questions about any of this information, please call your investment professional or one of our customer service representatives at (800) 235-8396. They will be happy to assist you.
Choosing a Share Class
Fund Shares
◾No front-end sales charge or contingent deferred sales charge (“CDSC”). All your money goes to work for you right away.
◾Fund Shares do not pay any ongoing distribution and/or service (12b-1) fees.
◾Typically, lower annual expenses than all classes except Institutional and R6 Shares.
Institutional Shares
◾No front-end sales charge or CDSC. All your money goes to work for you right away.
◾Institutional Shares do not pay any ongoing distribution and/or service (12b-1) fees.
◾Institutional Shares are only available to certain investors.
◾Typically, lower annual expenses than all classes except R6 Shares.
Class A
◾Front-end sales charge, as described in this section. There are several ways to reduce or eliminate this charge as discussed under Sales Charge Reductions and Waivers for Class A Shares.
◾A CDSC may be imposed if you sell your shares within 18 months of their purchase. The CDSC may be waived or reduced in certain circumstances as discussed under CDSC Reductions for Class A and Class C Shares.
◾Class A shares also pay ongoing distribution and/or service (12b-1) fees.
◾Lower annual expenses than Class C shares.
Class C
◾No front-end sales charge. All your money goes to work for you right away.
Prospectus | 37
◾A CDSC may be imposed if you sell your shares within 12 months of purchase. The CDSC may be waived or reduced in certain circumstances as discussed under CDSC Reductions for Class A and Class C Shares.
◾Class C shares also pay ongoing distribution and/or service (12b-1) fees.
◾Higher annual expenses than all other classes of shares.
R6 Shares
◾No front-end sales charge or CDSC. All your money goes to work for you right away.
◾Class R6 Shares do not pay any ongoing distribution and/or service (12b-1) fees.
◾Class R6 Shares are only available to certain investors.
◾Typically lower annual expenses than all other classes of shares.
Member and Reward Shares
USAA 500 Index Fund only
USAA 500 Index Fund only
◾No front-end sales charge. All your money goes to work for you right away.
◾No ongoing distribution and/or service (12b-1) fees.
◾Reward Shares have lower annual expenses than Member Shares but are subject to higher minimum investment.
Share Classes
When you purchase shares of the Fund, you must choose a share class. The Fund offers the share classes listed on the prospectus cover that include a ticker symbol. Each share class represents an interest in the same portfolio of securities and is not a separate mutual fund. The classes differ in the sales charges, if any, and expenses that apply to your investment, allowing you and your Investment Professional to choose the class that best suits your investment needs.
Deciding which share class best suits your investment needs depends on a number of factors that you should discuss with your Investment Professional, including: whether you are eligible to invest in a particular class, how long you expect to hold your investment, how much you intend to invest in the Fund, and the total expenses associated with each share class.
The Fund reserves the right, without notice, to change the eligibility criteria for purchasing a particular share class. For example, a class of shares may be available to purchase only by retirement plans or by institutional investors. The Fund also may waive any applicable eligibility criteria or investment
38 | USAA Index Funds
minimums at its discretion. In addition, a fund or any class may be closed at any time for failure to achieve an economical level of assets or for other reasons.
Certain financial intermediaries who hold shares on behalf of their customers impose fees when the amount of shares of a particular class falls below a minimum threshold. To the extent that the amount of shares falls below that threshold, the Fund reserves the right to liquidate the shares held in accounts maintained by the financial intermediary.
Shares of the Funds are only available for sale in the United States and certain other areas subject to U.S. jurisdiction and may not be offered for sale in non-U.S. jurisdictions, except as approved by the Adviser. Investors residing outside of the United States (except those with Air/Army Post Office (“APO”), Fleet Post Office (“FPO”), or Diplomatic Post Office (“DPO”) addresses) generally may not purchase shares of the Funds, even if they are U.S. citizens or lawful permanent residents.
Eligibility Requirements to Purchase Member Shares
and Reward Shares
and Reward Shares
Member Shares and Reward Shares are each a separate share class of the USAA 500 Index Fund and are not separate mutual funds. Shares of the USAA 500 Index Fund are available for purchase directly with the Fund on the Internet, by telephone, or by mail.
If shares of the USAA 500 Index Fund are purchased through a retirement account or an investment professional (i.e., a financial intermediary), the policies and procedures relating to these purchases may differ from those discussed in this prospectus and may vary. Additional fees also may apply to your investment in the Fund, including a transaction fee, if you buy or sell shares of the Fund through a broker or other investment professional. For more information on these fees, check with your investment professional.
Note: Reward Shares are not available to: SIMPLE IRAs, SEP IRAs, KEOGHs, 403(b) custodian accounts, accounts held in pension plans, profit sharing plans, accounts held by corporations.
Eligibility Requirements to Purchase Fund Shares
The Fund Shares are a separate share class of the USAA Extended Market Index Fund and USAA Nasdaq-100 Index Fund and are not a separate mutual fund. Fund Shares are available for purchase directly with the Fund on the Internet, by telephone, or by mail. Fund Shares also are available through certain financial intermediaries.
Prospectus | 39
If Fund Shares are purchased through a retirement account or an investment professional (i.e., a financial intermediary), the policies and procedures relating to these purchases may differ from those discussed in this prospectus. Additional fees also may apply to your investment in a Fund, including a transaction fee, if you buy or sell shares of a Fund through a broker or other investment professional. For more information on these fees, check with your investment professional.
Eligibility Requirements to Purchase Institutional Shares
The Institutional Shares may be purchased by or through:
◾Investors purchasing through discretionary managed account programs and certain advisory programs sponsored by financial intermediaries, such as brokerage firms, investment advisors, financial planners, third-party administrators, and insurance companies.
◾Brokerage platforms of firms that have agreements with the Distributor to offer such shares solely when acting as an agent for the investor and the investor may be required to pay a commission and/or other forms of compensation to the broker.
◾Institutional investors, which include retirement plans, endowments, foundations, and bank trusts, as well as Affiliated Funds, and other persons or legal entities that the Fund may approve from time to time.
Eligibility Requirements to Purchase Class A and Class C Shares
Class A and Class C shares generally are made available through broker-dealers and other financial intermediaries and are subject to certain sales charges described below.
Calculation of Sales Charges for Class A Shares
Class A shares are sold at their public offering price, which is the NAV plus any applicable initial sales charge, also referred to as the “front-end sales load.” The sales charge may be reduced or eliminated for larger purchases, as detailed below or as described under Sales Charge Reductions and Waivers for Class A Shares. The investment levels required to obtain a reduced sales charge are commonly referred to as “breakpoints.”
All Class A purchases are subject to the terms described herein except for those purchases made through an intermediary specified in Appendix A – Variations in Sales Charge Reductions and Waivers Available Through Certain Intermediaries.
In order to obtain a breakpoint discount, you must inform the USAA Mutual Funds or your investment professional at the time you purchase shares of the existence of the other USAA accounts or purchases of USAA Mutual Funds that are eligible to be linked for the purpose of calculating the initial sales
40 | USAA Index Funds
charge. The Fund or your investment professional may ask you for records or other information about other USAA Mutual Funds held in your USAA accounts and any linked accounts, such as accounts opened with a different financial intermediary.
The current sales charge rates and breakpoint levels for Class A shares of the Fund are listed below:
|
Your Investment in the Fund |
Sales
Charge
as a % of
Offering
Price |
Sales
Charge
as a % of
Your
Investment |
|
Less than $100,000 |
2.25% |
2.30% |
|
$100,000 up to $249,999 |
1.75% |
1.78% |
|
Over $250,000 |
0.00% |
0.00% |
Sales Charge Reductions and Waivers for Class A Shares
There are a number of ways you can reduce your sales charges, which we describe below. In order to obtain a Class A sales charge reduction or waiver, you must provide your financial intermediary or the Funds, at the time of purchase, with current information regarding shares of any USAA Mutual Funds held in other accounts. This information must include account statements or other records (including written representations from the intermediary holding the shares) that indicate any accounts (e.g., retirement accounts) established (i) with the USAA Mutual Funds and your investment professional; (ii) with other financial intermediaries; and (iii) in the name of immediate family household members (spouse or domestic partner and children under 21) with regard to Rights of Accumulation.
The availability of a sales charge reduction or waiver discussed below will depend upon whether you purchase your shares directly from the Fund or through a financial intermediary. If you are eligible for a sales charge reduction because you own shares of other USAA Mutual Funds, you must notify the Fund or your financial intermediary at the time of purchase of any relationship or other facts qualifying you for sales charge reductions or waivers. Some intermediaries impose different policies for sales charge waivers and reductions. These variations are described in Appendix A — Variations in Sales Charge Reductions and Waivers Available Through Certain Intermediaries. Except as described with respect to the intermediaries specified in Appendix A, all Class A shares are subject to the terms stated below. In order to obtain waivers and discounts that are not available through your intermediary, you must purchase Fund shares directly from the Fund or through another intermediary.
Prospectus | 41
You can find additional information regarding sales charges and their reductions, free of charge, at vcm.com/policies, by clicking on Victory Funds Pricing Policies.
You may reduce or eliminate the sales charge applicable to Class A shares in a number of ways:
❖ Breakpoint – Purchase a sufficient amount to reach a breakpoint (see Calculation of Sales Charges for Class A Shares above);
❖ Letter of Intent – If you anticipate purchasing $50,000 or more of Class A shares of the Fund, including any purchase of other USAA Mutual Funds of any share class (except money market funds and assets held in group retirement plans) within a 13-month period, you may qualify for a sales charge breakpoint as though you were investing the total amount in one lump sum. In order to qualify for the reduced sales charge, you must submit a non-binding Letter of Intent (the “Letter”) within 90 days of the start of the purchases. Each investment you make after signing the Letter will be entitled to the sales charge applicable to the total investment indicated in the Letter. You must start with a minimum initial investment of at least 5.00% of the total amount you intend to purchase. A portion of the shares purchased under the Letter will be held in escrow until the total investment has been completed. In the event you do not complete your commitment set forth in the Letter in the time period specified, sufficient escrowed shares will be redeemed to pay any applicable front-end sales charges;
❖ Right of Accumulation – Whereas a Letter of Intent allows you to qualify for a discount by combining your current purchase amount with purchases you intend to make in the near future, a Right of Accumulation allows you to reduce the initial sales charge on a Class A investment by combining the amount of your current purchase with the current market value of prior investments made by you, your spouse (including domestic partner), and your children under age 21 in any class of shares of any USAA Mutual Funds (except money market funds and any assets held in group retirement plans). The value of eligible existing holdings will be calculated by using the greater of the current value or the original investment amount. To ensure that you receive a reduced price using the Fund’s Right of Accumulation, you or your Investment Professional must inform the Funds that the Right applies each time shares are purchased and provide sufficient information to permit confirmation of qualification;
❖ Reinstatement Privilege – You may reinvest at NAV all or part of your redemption proceeds within 90 days of a redemption of Class A shares of the Fund;
❖ Waiver – The USAA Mutual Funds will completely waive the sales charge for Class A shares in the following cases:
◾Purchases of $250,000 or more;
42 | USAA Index Funds
◾Purchases by certain individuals associated with the USAA Mutual Funds or service providers (see Eligibility of Individuals Associated with the USAA Mutual Funds and Fund Service Providers);
◾Purchases by registered broker-dealers, financial intermediaries or their agents, or affiliates who have agreements with the Fund’s distributor (the “Distributor”), if the shares are purchased for their own account, purchased for retirement plans of their employees, or sold to registered representatives or full-time employees (or their immediate families), provided that such purchase is for one of the foregoing types of accounts;
◾Purchases for trust or other advisory accounts established with a financial institution and fee-based investment products or accounts;
◾Reinvestment of proceeds from a liquidation distribution of Class A shares of USAA Mutual Funds held in a deferred compensation plan, agency, trust, or custody account;
◾Purchases by retirement plans, including Section 401 and 457 plans sponsored by a Section 501(c)(3) organization and certain non-qualified deferred compensation arrangements that operate in a similar manner to qualified plans. Investors nonetheless may be charged a fee if they effect transactions in Class A shares through a broker or agent;
◾Purchases by participants in no transaction fee programs offered by certain broker-dealers (sometimes referred to as “supermarkets”);
◾Purchases by certain financial intermediaries who offer shares to self-directed investment brokerage accounts that may or may not charge a transaction fee to its customers;
◾Investors that have an investment account with the Adviser; and
◾Individuals who reinvest the proceeds of redemptions from Institutional Shares or R6 Shares of USAA Mutual Funds within 60 days of redemption.
You should inform the Fund or your investment professional at the time of purchase of the sales charge waiver category that you believe applies.
CDSC for Class A Shares
A contingent deferred sales charge (“CDSC”) of 0.75% may be imposed on certain redemptions of Class A shares purchased without an initial sales charge if any of those shares are redeemed within 18 months of purchase. This charge will be based on either the cost of the shares or NAV at the time of redemption, whichever is lower. No CDSC is imposed on shares representing reinvested distributions.
Prospectus | 43
More information is available in CDSC Reductions and Waivers for Class A and Class C Shares and Appendix A – Variations in Sales Charge Reductions and Waivers Available Through Certain Intermediaries. All Class A purchases are subject to the terms described herein except for those purchases made through the intermediaries specified in Appendix A.
CDSC for Class C Shares
You will pay a 1.00% CDSC on any Class C shares you sell within 12 months of purchase. The CDSC is based on the current value of the shares being sold or their NAV when purchased, whichever is less. There is no CDSC on shares you acquire by reinvesting your dividends or capital gains distributions. You may be eligible for reduction or waiver of this CDSC under certain circumstances. There is no CDSC imposed when you exchange your shares for Class C shares of another USAA Fund or Victory Fund; however, your exchange is subject to the same CDSC schedule that applied to your original purchase.
An investor may, within 90 days of a redemption of Class C shares, reinvest all or part of the redemption proceeds in the Class C shares of any USAA Fund or Victory Fund at the NAV next computed after receipt by the transfer agent of the reinvestment order. Class C share proceeds reinvested do not result in a refund of any CDSC paid by the shareholder, but the reinvested shares will be treated as CDSC-exempt upon reinvestment. The shareholder must ask the Distributor for such privilege at the time of reinvestment.
To keep your CDSC as low as possible, each time you sell shares we will first sell any shares in your account that are not subject to a CDSC. If there are not enough of these to meet your sale, we will sell the shares in the order they were purchased.
More information is available in CDSC Reductions and Waivers for Class A and Class C Shares and Appendix A – Variations in Sales Charge Reductions and Waivers Available Through Certain Intermediaries.
CDSC Reductions and Waivers for Class A and Class C Shares
No CDSC is imposed on redemptions of Class A and Class C shares in the following circumstances:
❖ To the extent that the shares redeemed:
◾are no longer subject to the holding period for such shares;
◾resulted from reinvestment of distributions; or
◾were exchanged for shares of another USAA Mutual Fund or Victory Fund as allowed by the prospectus, provided that the shares acquired in such exchange or subsequent exchanges will continue to remain subject to the CDSC, if applicable, calculated from the original date
44 | USAA Index Funds
of purchase until the applicable holding period expires. In determining whether the CDSC applies to each redemption, shares not subject to a CDSC are redeemed first;
❖ Following the death or post-purchase disability of:
◾a registered shareholder on an account; or
◾a settlor of a living trust, of shares held in the account at the time of death or initial determination of post-purchase disability;
❖ Distributions from individual retirement accounts, Section 403(b), Section 457, and Section 401 qualified plans, where redemptions result from:
◾required minimum distributions with respect to that portion of such contributions that does not exceed 12% annually;
◾tax free returns of excess contributions or returns of excess deferral amounts;
◾distributions on the death or disability of the account holder;
◾distributions for the purpose of a loan or hardship withdrawal from a participant plan balance; or
◾distributions as a result of separation of service;
❖ Distributions as a result of a Qualified Domestic Relations Order or Domestic Relations Order required by a court settlement;
❖ In instances where the investor’s dealer or institution waived its commission in connection with the purchase and notifies the Distributor prior to the time of investment;
❖ When the redemption is made as part of a Systematic Withdrawal Plan (including dividends), up to an annual amount of 12% of the account value on a per fund basis, at the time the withdrawal plan is established; or
❖ Participant-initiated distributions from employee benefit plans or participant-initiated exchanges among investment choices in employee benefit plans.
Eligibility Requirements to Purchase R6 Shares
Class R6 shares may only be purchased by or through:
◾Endowment funds and foundations;
Prospectus | 45
◾Retirement plans, including Section 401 and 457 plans, section 403 plans sponsored by a section 501(c)(3) organization, employer sponsored benefit plans (including health savings accounts) and certain non-qualified deferred compensation arrangements that operate in a similar manner to qualified plans;
◾Advisory programs with an approved financial intermediary in which the financial intermediary typically charges the investor a fee based upon the value of the account (“Advisory Program”); and
◾Registered investment companies.
Such investments may be subject to additional rules or requirements of the applicable Advisory Program.
The R6 Shares are not available to retail accounts, traditional or Roth IRAs, SEPs, SARSEPs, SIMPLE IRAs, or 529 Education Savings Plans.
Eligibility of Individuals Associated with the Funds and Fund Service Providers
Current and retired trustees of Victory advised funds and the officers, directors, trustees, employees, and family members of employees of the Adviser or Affiliated Providers are eligible to purchase the lowest expense share class offered by the Fund. In the case of Class A shares, such purchases are not subject to a front-end sales charge. “Affiliated Providers” are affiliates of the Adviser and organizations that provide services to USAA Mutual Funds Trust (the “Trust”).
Additional Information Regarding Financial Intermediaries
Your ability to purchase, exchange, redeem, and transfer shares will be affected by the policies of the financial intermediary through which you do business. Some policy differences may include: minimum investment requirements, exchange policies, fund choices, cutoff time for investments, and trading restrictions.
In addition, your financial intermediary may charge a transaction or other fee for the purchase or sale of shares of the Fund. Those charges are retained by the financial intermediary and are not shared with us. Please contact your financial intermediary or plan sponsor for a complete description of its policies.
Copies of each Fund's annual report, semi annual report, and SAI are available from your financial intermediary or plan sponsor.
46 | USAA Index Funds
How to Buy Shares
Opening an Account With the Funds
You may purchase shares directly from the Fund or through certain investment professionals (e.g., financial intermediaries) as described below. If you already have an account with us, you will not need to fill out another application to invest in another fund, including other funds managed by the Adviser (together with the Fund, we refer to these as the “Affiliated Funds” or so simply as the “Funds”), unless the registration is different or we need further information to verify your identity.
As required by federal law, we must obtain certain information from you prior to opening an account with us. If we are unable to verify your identity, we may refuse to open your account, or we may open your account and take certain actions without prior notice to you, including restricting account transactions pending verification of your identity. You may be asked for a copy of your driver’s license, passport, or other identifying documents as part of this process which may be cross-referenced against a consumer report or other electronic database. Additional information may be required to open accounts for corporations and other entities. If we subsequently are unable to verify your identity within a reasonable time, we may close your account or take other appropriate action. If your account is closed for this reason, your shares will be redeemed at the next calculated NAV. We prohibit opening accounts for certain investors, including but not limited to, foreign financial institutions, shell banks, correspondent accounts for foreign shell banks, and correspondent accounts for foreign financial institutions. A “foreign shell bank” is a foreign bank without a physical presence in any country. A “correspondent account” is an account established for a foreign bank to receive deposits from, or to make payments or other disbursements on behalf of, the foreign bank, or to handle other financial transactions related to such foreign bank.
Each shareholder named on an account with us must provide a Social Security number or other taxpayer identification number to avoid “backup” tax withholding required by the Internal Revenue Code of 1986, as amended (the “Code”).
Effective Date of Purchase
Purchase, exchange, and redemption requests are not processed until received in proper form. “Proper form” means actual receipt of the order along with all information and supporting documentation necessary to effect the transaction. Complete information may include any verification or confirmation of identity that the Funds' transfer agent or other authorized Fund agent may request. For purchase requests, “proper form” also generally includes receipt of sufficient funds to effect the purchase. Each Fund, its transfer agent, or any authorized Fund agent may, in its sole discretion, determine whether any particular
Prospectus | 47
transaction request is in good order and reserve the right to change or waive any good order requirement at any time. Financial intermediaries may have their own requirements for recognizing a transaction in proper form or good order. If you hold your shares through a financial intermediary, please contact them for specific proper form or good order requirements.
When you make a purchase, your purchase price will be the NAV per share next calculated after we or the financial intermediary receive your request in “proper form.” Each Fund’s NAV per share is calculated as of the close of the regular trading session (generally 4 p.m. Eastern time) of the New York Stock Exchange (“NYSE”) each day it is open for trading. If we or the financial intermediary receive your purchase request in proper form prior to that time, your purchase price will be the NAV per share calculated for that day. If we or the financial intermediary receive your purchase request in proper form after that time, the purchase price will be the NAV per share calculated as of the close of the next regular trading session of the NYSE.
The Funds or the Funds' Distributor or transfer agent may enter into agreements with Servicing Agents (such as financial intermediaries or plan sponsors), which hold shares of a Fund in omnibus accounts for their customers, under which the Servicing Agents are authorized to receive orders for shares of a Fund on a Fund’s behalf. Under these arrangements, a Fund will be deemed to have received an order when an authorized Servicing Agent receives the order. Accordingly, customer orders will be priced at the respective Fund’s NAV per share next calculated after they are received by an authorized Servicing Agent even though the orders may be transmitted to the Fund by the Servicing Agent after the time a Fund calculates its NAV.
Paying for Your Initial Purchase
If you hold an account directly with a Fund and you plan to purchase shares from us with a check, the instrument must be written in U.S. dollars and drawn on a U.S. bank. In addition, initial purchases into an account by electronic funds transfer or check may be held for up to 30 days before any redemptions may be processed. We do not accept the following foreign instruments: checks, money orders, traveler’s checks, or other similar instruments. In addition, we do not accept cash or coins. If you plan to purchase shares through a financial intermediary, please check with that financial intermediary regarding acceptable forms of payment.
Minimum Initial Purchase
Member Shares: (USAA 500 Index Fund Only)
Fund Shares: (USAA Nasdaq-100 Index Fund and USAA Extended Market Index Fund)
Fund Shares: (USAA Nasdaq-100 Index Fund and USAA Extended Market Index Fund)
$3,000 minimum. However, financial intermediaries may set different investment minimums, and the respective Fund reserves the right to waive or lower purchase minimums in certain circumstances.
48 | USAA Index Funds
Reward Shares: (USAA 500 Index Fund Only)
$100,000 minimum for new investors. Alternatively, investors who hold Member Shares and whose account balance in the Fund is at least $100,000 or who have an account through a discretionary managed account program will have their Member Shares converted to Reward Shares (see the section titled How to Exchange Shares and Class Conversions). Until we verify that you are indeed eligible for Reward Shares, you will hold Member Shares, which will be converted to Reward Shares upon verification.
Institutional Shares: (USAA Nasdaq-100 Index Fund Only)
$1 million. However, the Fund reserves the right to waive or lower purchase minimums in certain circumstances.
Class A and Class C Shares: (USAA Nasdaq-100 Index Fund Only)
$2,500 minimum ($1,000 for IRA accounts, gift/transfer to minor accounts, and purchases through automatic investment plans). However, financial intermediaries may set different investment minimums, and the Fund reserves the right to waive or lower purchase minimums in certain circumstances. For Class C shares, individual purchases of $250,000 and above will automatically be made in Class A shares.
If your account falls below the minimum investment amount, we may ask you to reestablish the minimum investment. If you do not do so within 60 days, we may close your account and send you the value of your account.
The minimum investment required to open an account may be waived or lowered for employees, and immediate family members of the employee, of the Adviser, the Administrator, and their affiliates. In addition, the minimum investment required may be waived when the Fund is purchased through an Advisory Program or within qualified retirement plans or in other similar circumstances.
R6 Shares: (USAA Nasdaq-100 Index Fund Only)
There is no minimum investment amount for R6 Shares. However, financial intermediaries or plan recordkeepers may require participants to meet different investment minimums.
Additional Purchases
Member Shares and Reward Shares: (USAA 500 Index Fund Only)
Fund Shares: (USAA Nasdaq-100 Index Fund and USAA Extended Market Index Fund)
Fund Shares: (USAA Nasdaq-100 Index Fund and USAA Extended Market Index Fund)
$50 per transaction minimum, per account. A Fund reserves the right to waive or lower purchase minimums in certain circumstances.
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Institutional Shares: (USAA Nasdaq-100 Index Fund Only)
There is no subsequent purchase minimum for investments in Institutional Shares.
Class A and Class C Shares: (USAA Nasdaq-100 Index Fund Only)
$50 per transaction minimum, per account.
R6 Shares: (USAA Nasdaq-100 Index Fund Only)
There is no subsequent purchase minimum investment amount for R6 Shares. However, financial intermediaries or plan recordkeepers may require participants to meet different subsequent purchase requirements.
Contacting the USAA Mutual Funds
The following features may be available to you to purchase, exchange, and redeem shares of a Fund you hold in an account opened directly with a Fund. Once you have an existing account, you can make additional investments at any time in any amount (subject to any minimums) in the following ways. All website transactions should be placed online at vcm.com.
Internet Access
◾Review account information and make most account transactions. This includes making purchases, exchanges, and redemptions; reviewing account activity; checking balances; and more.
Mobile Access
◾Review account information and make most account transactions.
Telephone Access
◾To access account information and make account transactions, call toll free (800) 235-8396 during normal business hours to speak with a member service representative.
Mail
◾If you would like to make a purchase or request a redemption by mail, send your written instructions to:
Regular Mail:
USAA Mutual Funds
P.O. Box 182593
Columbus, OH 43218-2593
P.O. Box 182593
Columbus, OH 43218-2593
Registered or Express Mail:
USAA Mutual Funds
4249 Easton Way
Suite 400
Columbus, OH 43219
4249 Easton Way
Suite 400
Columbus, OH 43219
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Bank Wire
◾To add to your account or request a redemption by bank wire, visit the vcm.com website or call (800) 235-8396 for instructions. This helps to ensure that your account will be credited or debited promptly and correctly. Any commercial bank can transfer same-day funds by wire.
◾Although the transfer agent currently does not charge you for receiving same-day funds, it reserves the right to charge for this service in the future. Your bank may charge you for wiring same-day funds.
Electronic Funds Transfer
◾Additional purchases on a regular basis may be deducted electronically from a bank account. To sign up for these services when opening an account, visit the vcm.com website or call (800) 235-8396 for assistance. Currently, the Fund does not charge a fee for electronic transfers, but it reserves the right to charge for this service in the future. Your originating bank may charge a fee for electronic transfers.
How to Exchange Shares and Class Conversions
The shares of any class of a Fund may be exchanged for the shares of any other class offered by the Fund or the same class, or any other class, of any other USAA Mutual Funds, either through your investment professional or directly through the Fund, subject to the conditions described below:
◾Exchanges are subject to any CDSC, minimum investment limitation, or eligibility requirements described in the applicable prospectus and SAI. You may be required to provide sufficient information to establish eligibility to exchange into a new share class.
◾To exchange between USAA Mutual Funds, the other USAA Mutual Fund you wish to exchange into must be eligible for exchange with your Fund.
◾Shares of the USAA Mutual Fund selected for exchange must be available for sale in your state of residence.
If you have questions about these, or any of the Fund’s other exchange policies, please consult your customer service representative or your Investment Professional before requesting an exchange.
Before exchanging, you should read the prospectus of the Fund you wish to exchange into, which may be subject to different risks, fees, and expenses.
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Other Exchange Rules You Should Know
If you have opened an account directly with a Fund, you may make exchanges on vcm.com. After we receive the exchange orders, the Fund’s transfer agent will simultaneously process exchange redemptions and purchases at the share prices next calculated pursuant to the procedures set forth herein. See Effective Date of Purchase for additional information. The investment minimums applicable to share purchases also apply to exchanges.
If you hold shares of a Fund in an account with a financial intermediary or plan sponsor, the policies and procedures on an exchange may differ from those discussed in this prospectus. Additional fees also may apply to your investment in a Fund, including a transaction fee, if you buy, sell, or exchange shares of a Fund through a broker or other Investment Professional. For more information on these fees, check with your Investment Professional.
An exchange of Fund shares for shares of another USAA Mutual Fund constitutes a sale for tax purposes unless the exchange is made within an IRA or other tax-deferred account.
The Fund may refuse any exchange purchase request if the Adviser determines that the request is associated with a market timing strategy. The Fund may terminate or modify the exchange privilege at any time upon 60 days’ notice to shareholders.
For information on how to exchange shares of a Fund that were purchased through your employer’s retirement plan, including any restrictions and charges that the plan may impose, please consult your employer.
Conversion into Reward Shares
The following discussion applies to the USAA 500 Index Fund only. We will convert Member Shares into Reward Shares if you meet either of the following criteria:
◾Your account balance in the Fund is at least $100,000; or
◾You hold Member Shares through a discretionary managed account program.
Conversion into Member Shares
If you no longer meet the requirements for our Reward Shares, the Fund may reclassify your Reward Shares into Member Shares. A decline in your account balance due to redemption or exchange may result in such a conversion. Market movement alone, however, will not result in a conversion. The Fund will notify you in writing before any mandatory conversion into Member Shares.
52 | USAA Index Funds
If your account held Reward Shares as of April 30, 2006, and does not satisfy the above criteria, you may continue to hold Reward Shares and are eligible to purchase additional Reward Shares in your account, provided that you continue to satisfy the eligibility criteria that were previously in effect and on which the purchase of your Reward Shares was based. A conversion between share classes of the same fund is a non-taxable event.
Class C Share Conversion
Class C shares of the Fund will automatically convert to Class A shares in the month following the eight-year anniversary date of the purchase of the Class C shares. Your financial intermediary may have a conversion schedule that is shorter than eight years. Class C conversions will be effected at the relative NAV of each such class without the imposition of any sales charge, fee or other charge.
You may be able to voluntarily convert your Class C shares before the stated anniversary to a different share class of the same Fund that has a lower total annual operating expense ratio provided certain conditions are met. This voluntary conversion feature is intended for shares held through a financial intermediary offering a fee-based or wrap fee program that has an agreement with the Adviser or the Distributor specific for this purpose. Generally, Class C shares are not eligible for conversion until the applicable CDSC period has expired. Please contact your financial intermediary for additional information.
Other Conversions
Under certain circumstances, we may convert your (i) Institutional Shares to Fund Shares and (ii) Class A shares to Fund Shares or Institutional Shares, as applicable.
The Fund also may provide for other conversion privileges from time to time under which a shareholder of the Fund may convert shares into another class of shares of the same Fund under certain circumstances, subject to approval by the Fund’s officers. For example, subject to approval by the Fund’s officers, a shareholder may convert shares of one class of the Fund held through an eligible advisory program into shares of another class of the Fund (if available) with a lower expense ratio, provided that following the conversion the shareholder meets applicable eligibility requirements for the class into which the shareholder seeks to convert (as described in this prospectus).
Pricing
When a conversion occurs, you receive shares of one class of a fund for shares of another class of the same fund. At the time of conversion, the dollar value of the “new” shares you receive equals the dollar value of the “old” shares that were converted. In other words, the conversion has no effect on
Prospectus | 53
the value of your investment in the fund at the time of the conversion. However, the number of shares you own after the conversion may be greater than or less than the number of shares you owned before the conversion, depending on the NAVs per share of the two share classes. A conversion between share classes of the same fund is a non-taxable event.
Conversions are not subject to the Fund's restrictions on short-term trading activity discussed under Excessive Short-Term Trading.
How to Sell Shares
Shareholders will receive a redemption price of the NAV per share next calculated after we receive the redemption request in “proper form” as provided under Effective Date of Purchase. If we receive the redemption request in proper form prior to the close of the NYSE’s regular trading session (generally 4 p.m. Eastern time), the redemption price will be the NAV per share calculated for that day. If we receive the redemption request after that time, the redemption price will be the NAV per share calculated as of the close of the next regular trading session of the NYSE.
Under certain circumstances and when deemed to be in the Fund’s best interests, proceeds may not be sent to intermediaries for up to seven days after receipt of the redemption order.
There are a number of convenient ways to sell your shares. If you have a direct account with a Fund, you may redeem shares of a Fund on the Internet, by telephone, or by mail on any day the NAV per share is calculated. You can use the same mailing addresses listed under the section titled How to Buy Shares.
By Internet
Log on to your account using vcm.com and place your redemption request.
By Telephone
Call toll free (800) 235-8396 during normal business hours. You have the following options for receiving your redemption proceeds:
◾Mail a check to the address of record;
◾Wire funds to a previously designated domestic financial institutional;
◾Mail a check to a previously designated alternate address; or
◾Electronically transfer your redemption via EFT to a previously designated domestic financial institution.
Each Fund has undertaken certain authentication procedures regarding telephone transactions and will employ reasonable procedures to confirm that instructions communicated by telephone are genuine. Before any discussion regarding your account, we will obtain certain information from you to verify
54 | USAA Index Funds
your identity. Additionally, your telephone calls may be recorded or monitored, and confirmations of account transactions are sent to the address of record or by electronic delivery to your designated e-mail address.
By Mail
Use the regular U.S. mail or overnight mail address to redeem shares. Send us a letter of instruction indicating your Fund account number, amount of redemption, and where to send the proceeds.
By Wire
If you want to receive your proceeds by wire, you must establish a Fund account that will accommodate wire transactions. If you call before the close of trading on the NYE, your funds will be wired on the next business day.
By Electronic Funds Transfer (“EFT”)
Normally, your redemptions will be processed on the same day, but will be processed on the next day if received after close of trading on the NYSE. It will be transferred by EFT as long as the transfer is to a domestic bank.
Additional Information About Redemptions
Each Fund may elect to suspend the redemption of shares or postpone the date of payment in limited circumstances (e.g., if the NYSE is closed or when permitted by order of the SEC).
Under normal market conditions, each Fund typically expects to meet redemption requests by paying out proceeds from cash or cash equivalent portfolio holdings, or by selling portfolio holdings. Under deteriorating market conditions or market stress, a Fund also may borrow to meet redemption requests. A Fund and the other Affiliated Funds are limited as to the amount that each may individually and collectively borrow in these circumstances. As a result, borrowings available to a Fund may be insufficient to satisfy Fund redemption requests. In addition, a Fund reserves the right to honor redemption orders wholly or partly with in-kind distributions of Fund portfolio securities instead of cash.
Fund Shares, Member Shares, and Reward Shares:
If you hold shares of a Fund through an account directly with a Fund, a Fund typically expects to pay out redemption proceeds on the next business day after your order is received in proper form; however, it may take up to seven days to send your proceeds.
Payment for redemption of shares purchased by electronic funds transfer (“EFT”) or check will be sent after the EFT or check has cleared, which could take up to 30 days from the initial purchase date into the Fund and, for any subsequent purchases into the Fund, seven business days from the purchase date.
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If you choose to have your redemption proceeds mailed to you and either the U.S. Postal Service is unable to deliver the distribution check to you or the check remains outstanding for more than six months, the Fund reserves the right to reinvest the check in shares of the Fund at its then current NAV until you give the Fund different instructions. No interest will accrue on amounts represented by uncashed redemption checks.
If you hold shares of a Fund with a financial intermediary, please contact your financial intermediary regarding redemption policies. Normally, a Fund transmits proceeds to intermediaries for redemption orders that are received in proper form on the next business day after receipt.
Institutional Shares:
Institutional Shares typically expect to pay out redemption proceeds on the next business day after your order is received in proper form; however, it may take up to seven days to send your proceeds.
Class A and Class C Shares:
Check with your financial intermediary for its policies on redemptions. Class A and Class C shares purchased through a financial intermediary should be redeemed through the financial intermediary. The Fund typically expects to transmit proceeds to intermediaries for redemption orders received in proper form on the next business day after receipt.
R6 Shares:
R6 Shares generally may be purchased or redeemed only through employer-sponsored retirement plans where a financial intermediary provides retirement recordkeeping services to plan participants. Check with your financial intermediary or plan sponsor for its policies on redemptions. Normally, the Fund transmits proceeds to intermediaries and eligible institutional investors (foundations and endowment funds) for redemption orders received in proper form on the next business day after receipt.
For federal income tax purposes, a redemption of shares of a Fund is a taxable event, upon which you may recognize a capital gain or loss (unless you hold the shares of the Fund in a tax-deferred account or are a tax-exempt investor). A capital gain or loss is based on the difference between your basis in the redeemed shares and the proceeds you receive upon their redemption. See Important Information About Taxes for information regarding basis election and reporting.
Information About Fees
The Funds are comprised of multiple classes of shares. Each class shares the respective Fund's investment objective and investment portfolio. The classes have different fees, expenses, and/or minimum investment requirements. The difference in the fee structures between the classes is primarily the result of
56 | USAA Index Funds
their separate arrangements for shareholder and distribution services and performance fee arrangements. It is not the result of any difference in the base investment management, custodial fee rate schedules, or other expenses related to the management of the Funds' assets, which do not vary by class. Shareholders of R6 Shares do not require the same level of shareholder and administrative services from the USAA Nasdaq-100 Index Fund as shareholders of the other classes. Different fees and expenses will affect performance.
Except as described below, the share classes have identical voting, dividend, liquidation, and other rights, preferences, terms, and conditions. The primary differences between the classes are: (a) each class may be subject to different expenses specific to that class; (b) each class has a different identifying designation or name; (c) each class has exclusive voting rights with respect to matters solely affecting that class; and (d) each class may have different purchase, exchange, and redemption privileges.
Distribution and Service Plans
In accordance with Rule 12b-1 under the Investment Company Act of 1940, the Trust has adopted Distribution and Service Plans for Class A and Class C shares of the Fund.
Under the Class A Distribution and Service Plan, the Fund will pay to the Distributor a monthly fee at an annual rate of up to 0.25% of its average daily net assets of its Class A shares. The fee is paid for general distribution services and for providing personal services to shareholders. Distribution and selling services are provided by the Distributor or by agents of the Distributor and include those services intended to result in the sale of the Fund’s shares.
Personal services to shareholders generally are provided by broker-dealers or other financial intermediaries and consist of responding to inquiries, providing information to shareholders about their Fund accounts, establishing and maintaining accounts and records, providing dividend and distribution payments, arranging for bank wires, assisting in transactions, and changing account information.
Under the Class C Distribution and Service Plan, the Fund will pay to the Distributor a monthly fee at an annual rate of 1.00% of the average daily net assets of its Class C shares. Of this amount, 0.75% of the Fund’s Class C shares average daily net assets will be paid for general distribution services and for selling Class C shares. The Fund will pay 0.25% of its Class C shares average daily net assets to compensate financial institutions that provide personal services to Class C shareholders of the Fund. Distribution and selling services are provided by the Distributor or by agents of the Distributor and include those services intended to result in the sale of the Fund's Class C shares. Personal services to shareholders are generally provided by broker-dealers or other financial intermediaries and consist of responding to inquiries, providing information to shareholders about their Fund accounts,
Prospectus | 57
establishing and maintaining accounts and records, providing dividend and distribution payments, arranging for bank wires, assisting in transactions and changing account information.
Because Rule 12b-1 fees are paid out of the Fund’s assets and on an ongoing basis, over time these fees will increase the cost of your investment and may cost you more than paying other types of sales charges. For additional information about the Rule 12b-1 Plan and its terms, see Distribution and Service Plans in the SAI.
Payments to Financial Intermediaries
Certain financial intermediaries perform recordkeeping, networking, administrative, sub-transfer agency, and shareholder services for their clients with respect to their investments in a Fund that otherwise would be performed by the Fund’s transfer agent or administrator and shareholder servicing agent.
In some circumstances, we, or one of our affiliates, will pay a financial intermediary for these services out of our own resources, including any profits from the advisory fees the Adviser receives from the Funds. In other circumstances, a Fund will pay a fee to the financial intermediary for performing those services. A Fund will not pay financial intermediaries more than it would pay its direct service providers for transfer agency, administration, and/or shareholder services. In cases where intermediary fees are higher due to differences in the services being provided or other factors, the additional amounts will be paid by us and/or the Distributor. In addition, these payments generally are based on either (1) a percentage of the average daily net assets of Fund shareholders’ accounts serviced by a financial intermediary or (2) a fixed dollar amount for each account serviced by a financial intermediary. The aggregate amount of these payments may be substantial.
In addition, we and the Funds' Distributor may make payments to intermediaries for various additional services, other expenses, and/or the financial intermediaries’ distribution of shares of a Fund. Such payments are sometimes referred to as “revenue sharing” and generally are negotiated with a financial intermediary on the basis of such factors as the number or value of shares of a Fund that the financial intermediary sells or may sell; the value of client assets invested; or the type and nature of services or support furnished by the financial intermediary.
We (and our affiliates) also may pay fixed fees for the listing of a Fund on a broker-dealer’s or financial intermediary’s system. Such payments are not considered to be revenue sharing payments.
The USAA Nasdaq-100 Index Fund does not pay any service, distribution, or administrative fees to financial intermediaries on R6 Shares. As a result, the R6 Shares pay lower fees.
58 | USAA Index Funds
Distribution and Taxes
Dividends and Other Distributions
As a shareholder, you are entitled to your share of net income and capital gains on the Fund’s investments. The Fund passes its earnings along to investors in the form of dividends. Dividends paid by the Fund represent the net income from dividends and interest earned on investments after expenses. The Fund will distribute short-term gains, as necessary; and if the Fund makes a long-term capital gain distribution, it normally is paid once a year in December.
You should check the Fund’s distribution schedule before you invest. If you buy shares of the Fund shortly before it makes a distribution, some of your investment may come back to you as a taxable distribution.
The USAA 500 Index Fund pays distributions of net investment income (“dividends”) quarterly. The USAA Nasdaq-100 Index Fund and USAA Extended Market Index Fund pay distributions of net investment income (“dividends”) annually. Each Fund may make additional distributions to shareholders, or may not make a distribution, when considered appropriate or necessary. For example, a Fund could make one or more additional distributions to avoid the imposition of any federal income or excise taxes, or it may not make a distribution to limit returns of capital.
Any distribution made by a Fund will reduce the NAV per share of the class by the amount of the distribution on the ex-distribution date. You should consider carefully the effects of purchasing shares of the Fund shortly before any distribution (as explained below under Important Information About Taxes). Some or all distributions may be subject to taxes.
Distributions can be received in one of the following ways:
Reinvestment Option
Each Fund automatically reinvests all income dividends and capital gain distributions, if any, on a share class in additional shares of that class unless you request to receive those distributions in cash by way of check or by way of electronic funds transfer.
Directed Bank Account Option
When you choose to receive cash dividends by way of electronic funds transfer to your bank checking or savings account, we will send them to you after the distribution date each month. The share price will be the NAV per share of the class computed on the ex-distribution date.
Prospectus | 59
Cash Option
If you elect to receive your distributions by check, and the distribution amount is $25 or less, the amount will automatically be reinvested in the Fund. Otherwise, a check will be mailed to you no later than seven days after the dividend payment date. If you choose to have your distribution proceeds mailed to you and either the U.S. Postal Service is unable to deliver the distribution check to you or the check remains outstanding for at least six months, the distribution option on your account will default to the reinvestment option as described above. Each Fund reserves the right to reinvest the check in shares of the Fund at its then current NAV until you give the Fund different instructions. No interest will accrue on amounts represented by uncashed distribution checks. Each Fund will invest in your account any dividend or other distribution payment returned to the Fund by your financial institution at the current NAV per share.
Income Earned Option
You can automatically reinvest your dividends in additional Fund shares and have your capital gains paid in cash, or reinvest capital gains and have your dividends paid in cash.
Directed Distributions Option
If you own shares in more than one USAA Mutual Fund, you may direct that dividends and/or capital gain distributions received from one USAA Mutual Fund be used to purchase shares automatically in the same class of another USAA Mutual Fund.
Important Information About Taxes
The following tax information is quite general and refers to the federal income tax law in effect as of the date of this prospectus.
Treatment of the Fund
Each Fund, which is treated as a separate corporation for federal tax purposes, has qualified for each past taxable year, and intends to continue to qualify, for treatment as a “regulated investment company” under the Internal Revenue Code of 1986, as amended (the “Code”). By doing so, each Fund (but not its shareholders) is relieved of federal income tax on the part of its investment company taxable income and net capital gain if any, that it distributes to its shareholders.
Shareholder Taxation
◾Distributions that shareholders receive from a Fund generally are subject to federal income tax and may be subject to state and/or local taxes.
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◾Dividends and distributions of net short-term gains are taxable to you as ordinary income, whether received in cash or reinvested in additional shares of a Fund or another USAA Mutual Fund.
◾A portion of a Fund’s dividends (which is not expected to be substantial) may qualify for (1) the 50% dividends-received deduction available to corporations, and (2) the lower maximum federal income tax rates applicable to “qualified dividend income” of individuals and certain other non-corporate shareholders (each, an “individual shareholder”) who satisfy certain holding period and other restrictions with respect to their shares of a Fund—a maximum of 15% for a single shareholder with taxable income not exceeding $445,850 ($501,600 for married shareholders filing jointly) and 20% for those individual shareholders with taxable income exceeding those respective amounts (which are effective for 2021 and will be adjusted for inflation annually thereafter).
◾Regardless of the length of time you have held shares of a Fund, distributions of net capital gains that a Fund realizes are taxable to you as long-term capital gains, whether received in cash or reinvested in additional shares of a Fund, and are taxed to individual shareholders at the 15% and 20% tax rates described above.
◾You may realize a capital gain or loss for federal income tax purposes on a redemption or an exchange (which is treated like a redemption for those purposes) of shares of a Fund. Your gain or loss is based on the difference, if any, between your basis in the redeemed (or exchanged) shares and the redemption proceeds (or the aggregate NAV of the shares of the fund into which you exchange) you receive. Any capital gain an individual shareholder recognizes on a redemption or exchange of his or her shares of a Fund that have been held for more than one year will qualify for the 15% and 20% tax rates.
◾An individual shareholder is subject to a 3.8% federal tax on the lesser of (1) the individual’s “net investment income,” which generally includes taxable distributions a Fund pays and net gains realized on the redemption or exchange of shares of the Fund, or (2) the excess of his or her “modified adjusted gross income” over $200,000 (or $250,000 if married and filing jointly). This tax is in addition to any other taxes due on that income.
◾Your basis in shares of a Fund that you acquired after December 31, 2011, (“Covered Shares”) will be determined in accordance with a Fund’s default method, which is average basis, unless you affirmatively elect in writing (which may be electronic) to use a different acceptable basis determination method, such as a specific identification method. The basis determination method you elect (or the default method) may not be changed with respect to a redemption of Covered Shares after the settlement date of the redemption.
Prospectus | 61
◾The Fund may provide estimated capital gain distribution information through the website at VictoryFunds.com.
◾Tax statements will be mailed from the Fund by mid-February showing the amounts and tax status of distributions made to you in the prior calendar year.
◾Because your tax treatment depends on your purchase price and tax position, you should keep your regular account statements for use in determining your tax.
◾You should review the more detailed discussion of federal income tax considerations in the SAI and consult your tax adviser regarding the federal, state, local, or foreign tax consequences resulting from your investment in the Fund.
Taxpayer Identification and Backup Withholding
◾Each shareholder named on an account with us must provide a Social Security number or other taxpayer identification number to avoid “backup” tax withholding required by the Code. Federal law requires each Fund to withhold and remit to the U.S. Treasury 24% of (1) dividends, capital gain distributions, and proceeds of redemptions, regardless of the extent to which gain or loss may be realized, otherwise payable to any individual shareholder who fails to furnish a Fund with a correct taxpayer identification number and (2) those dividends and distributions otherwise payable to any individual shareholder who underreports dividend or interest income or fails to certify that he or she is not subject to backup withholding.
◾Backup withholding is not an additional tax, and any amounts so withheld may be credited against a shareholder’s federal income tax liability or refunded. To avoid this withholding, you must certify on your application, or on a separate IRS Form W-9 supplied by the Funds' transfer agent, that your taxpayer identification number is correct and you currently are not subject to backup withholding.
Important Fund Policies
and Other Information
and Other Information
Share Price Calculation
The price at which you purchase and redeem shares of a Fund is equal to the NAV per share calculated on the effective date of the purchase or redemption. The NAV per share is calculated by adding the value of a Fund’s assets (i.e., the value of its investments and other assets), deducting liabilities, and dividing by the number of shares outstanding. Shares of a Fund may be purchased and sold at the NAV per share without a sales charge. A Fund’s NAV per share is calculated as of the close of the NYSE (generally 4 p.m.
62 | USAA Index Funds
Eastern time) each day that the NYSE is open for regular trading. The NYSE is closed on most national holidays and Good Friday.
Valuation of Securities
The Adviser has established a Pricing and Liquidity Committee (the “Committee”); and subject to Board oversight and approval, the Committee administers and oversees a Fund's valuation policies and procedures. Among other things, these policies and procedures allow a Fund to utilize independent pricing services, quotations from securities dealers, and a wide variety of sources and information to establish and adjust the fair value of securities as events occur and circumstances warrant.
Equity securities, including exchange-traded funds (“ETFs”), except as otherwise noted, traded primarily on domestic securities exchanges or the over-the-counter markets, are valued at the last sale price or official closing price on the exchange or primary market on which they trade. Equity securities traded primarily on foreign securities exchanges or markets are valued at the last quoted sale price, or the most recently determined official closing price calculated according to local market convention, available at the time the Fund is valued. If no last sale or official closing price is reported or available, the closing bid price generally is used for U.S.-listed equities and the average of the bid and ask prices is used for foreign listed equities.
Short-term debt securities with original or remaining maturities of 60 days or less generally may be valued at amortized cost, provided that amortized cost represents the fair value of such securities.
Repurchase agreements are valued at cost.
Investments in open-end investment companies, commingled, or other funds, other than ETFs, are valued at their NAV at the end of each business day.
Futures contracts are valued at the settlement price at the close of market on the principal exchange on which they are traded or, in the absence of any transactions that day, the values are based upon the settlement price on the prior trading date.
Options contracts are valued at the mean of the last bid and ask prices. Options on futures are valued at the settlement price determined by the applicable exchange.
In the event that price quotations or valuations are not readily available, are not reflective of market value, or a significant event has been recognized in relation to a security or class of securities, the securities are valued in good faith, at fair value, by the Committee in accordance with valuation procedures approved by the Board. The effect of fair value pricing is that securities may not be priced on the basis of quotations from the primary market in which they are traded, and the actual price realized from the sale of a security may
Prospectus | 63
differ materially from the fair value price. Valuing these securities at fair value is intended to cause a Fund’s NAV to be more reliable than it otherwise would be.
Fair value methods used by the Funds include, but are not limited to, obtaining market quotations from secondary pricing services, broker-dealers, other pricing services, or widely used quotation systems. General factors considered in determining the fair value of securities include fundamental analytical data, the nature and duration of any restrictions on disposition of the securities, evaluation of credit quality, and an evaluation of the forces that influenced the market in which the securities are purchased and sold.
For additional information on how securities are valued, see Valuation of Securities in the Funds' SAI.
Customer Identification Program
To help the government fight the funding of terrorism and money laundering activities, federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens a new account, and to determine whether such person’s name appears on government lists of known or suspected terrorists and terrorist organizations.
As a result, the Victory Funds must obtain the following information for each person who opens a new account:
◾Name;
◾Date of birth (for individuals);
◾Residential or business street address (although post office boxes are still permitted for mailing); and
◾Social security number, taxpayer identification number, or other identifying number.
You may also be asked for a copy of your driver’s license, passport, or other identifying document in order to verify your identity. In addition, it may be necessary to verify your identity by cross-referencing your identification information with a consumer report or other electronic database. Additional information may be required to open accounts for corporations and other entities. Federal law prohibits the Victory Funds and other financial institutions from opening a new account unless they receive the minimum identifying information listed above. After an account is opened, the Victory Funds may restrict your ability to purchase additional shares until your identity is verified. The Victory Funds may close your account or take other appropriate action if it is unable to verify your identity within a reasonable time. If your account is closed for this reason, your shares will be redeemed at the NAV next calculated after the account is closed.
64 | USAA Index Funds
Statements and Reports
You will receive a periodic statement reflecting any transactions that affect the balance or registration of Fund shares in your account. You will receive a confirmation after any purchase, exchange, or redemption. If your account has been set up by an Investment Professional, Fund activity will be detailed in that account’s statements. Share certificates are not issued. Twice a year, you will receive a financial report of the Fund. By February 15th of each year, you will be mailed an IRS form reporting distributions for the previous year, which also will be filed with the IRS.
Each Fund will report information to you annually concerning the tax status of your dividends and other distributions for federal income tax purposes. In addition, each Fund (or its administrative agent) must report to the IRS and furnish to its shareholders the basis information for Covered Shares and indicate whether they had a short-term (one year or less) or long-term (more than one year) holding period. You should consult with your tax adviser to obtain more information about how the basis reporting law applies to you.
Shareholder Communications
In order to eliminate duplicate mailings to an address at which two or more shareholders with the same last name reside, each household will receive a single copy of a Fund’s most recent shareholder reports, proxy statements, prospectuses, and their supplements, unless you have instructed us to the contrary. This eliminates duplicate copies and saves paper and postage costs for a Fund. However, if you would like to receive individual copies, please contact us; and they will be delivered promptly.
Portfolio Holdings Disclosure
A description of a Funds' policies and procedures with respect to the disclosure of a Funds' portfolio securities is available in a Funds' SAI, which is available upon request and on the Fund’s website at VictoryFunds.com.
IRA Distribution Fee
Each Fund may apply a distribution fee to all full IRA distributions, except for those due to death, disability, or divorce. Partial IRA distributions are not charged a distribution fee.
Account Balance
Victory Capital Transfer Agency, Inc., the Funds' transfer agent, may assess annually a small balance account fee of $12 to each shareholder account with a balance of less than $2,000 at the time of assessment. Accounts exempt from the fee include: (1) any account regularly purchasing additional shares each month through an automatic investment plan; (2) any UGMA/UTMA account; (3) all (non-IRA) money market fund accounts; (4) any account
Prospectus | 65
whose registered owner has an aggregate balance of $50,000 or more invested in Affiliated Funds; and (5) all IRAs (for the first year the account is open). The fee is not currently being assessed. The Fund will provide advance notice in the event it is assessed in the future.
Account Maintenance Fee
With respect to Member Shares held in the USAA 500 Index Fund, a maximum account maintenance fee of $10 per year may be charged to your account if you do not maintain an account balance greater than $10,000, or unless total household assets with the Adviser exceed $500,000. Household assets include Mutual Funds, 529 accounts, and other investable assets with the Adviser.
The $10 account maintenance fee will be deducted automatically from your account by the transfer agent at a rate of $2.50 per quarter based on your ending balance on the date the fee is taken, which generally will take place within 30 days of the Fund’s scheduled quarterly dividend payment. A sufficient number of shares may be redeemed from your account to pay the account maintenance fee. The amount of the annual account maintenance fee may be changed upon at least 30 days’ notice to you.
Excessive Short-Term Trading
The Funds generally are not intended as short-term investment vehicles (except for the money market funds, USAA Short-Term Bond Fund, USAA Ultra Short-Term Bond Fund, and USAA Tax Exempt Short-Term Fund). Some investors try to profit by using excessive short-term trading practices involving mutual fund shares, frequently referred to as “market timing.”
Excessive short-term trading activity can disrupt the efficient management of a fund and raise its transaction costs by forcing portfolio managers to first buy and then sell portfolio securities in response to a large investment or redemption by short-term traders. While there is no assurance that the Funds can deter all excessive and short-term trading, the Board has adopted the following policies (except for the money market funds, USAA Short-Term Bond Fund, USAA Ultra Short-Term Bond Fund, and USAA Tax Exempt Short-Term Fund). These policies are designed to deter disruptive, excessive short-term trading without needlessly penalizing bona fide investors.
To deter such trading activities, the Funds’ policies and procedures state that:
◾Each Fund reserves the right to reject any purchase order, including an exchange, that it regards as disruptive to the efficient management of the particular fund.
◾Each Fund may use a fair value pricing service or other model to assist in establishing the current value of foreign securities held by the Fund. Fair value pricing is used to adjust for “stale pricing” that may occur between the close of certain foreign exchanges or markets and the time
66 | USAA Index Funds
when the Fund calculates its NAV per share. The use of fair value pricing is intended to deter investors who may be trying to take advantage of time-zone differences in the valuation of foreign securities and to prevent dilution to long-term investors. Fair value pricing of a foreign security can result in a Fund using a price that is higher or lower than the closing price of a foreign security for purposes of calculating a Fund’s NAV.
The Funds’ Right to Reject Purchase and Exchange Orders and Limit Trading in Accounts
The Funds’ main safeguard against excessive short-term trading is their right to reject purchase or exchange orders if in the best interest of the affected fund. In exercising this discretion to reject purchase and exchange orders, the Funds deem that certain excessive short-term trading activities are not in the best interest of the fund because such activities can hamper the efficient management of the fund. Generally, persons with a history of three short-term transactions within 90 days or less are suspected of market timing and the shareholder’s trading privileges (other than redemption of Fund shares) will be suspended. The Funds also reserve the right to restrict future purchases or exchanges if an investor is classified as engaged in other patterns of excessive short-term trading, including after one large disruptive purchase and redemption or exchange. Finally, each Fund reserves the right to reject any other purchase or exchange order in other situations that do not involve excessive short-term trading activities if in the best interest of the Fund. For this purpose, a short-term transaction is a purchase or redemption of a Fund and, as applicable, a subsequent redemption or purchase of the same Fund, or an exchange of all or part of that same Fund.
The following transactions are exempt from the excessive short-term trading activity policies described above:
◾Transactions in the money market funds, USAA Short-Term Bond Fund, USAA Ultra Short-Term Bond Fund, and USAA Tax Exempt Short-Term Fund;
◾Purchases and sales pursuant to automatic investment or withdrawal plans;
◾Purchases and sales made through USAA 529 Education Savings Plan;
◾Purchases and sales made in certain separately managed accounts in wrap fee programs;
◾Purchases and sales by the USAA Target Retirement Funds, USAA Cornerstone Conservative Fund, and/or USAA Cornerstone Equity Fund; and
◾Other transactions that are not motivated by short-term trading considerations if they are approved by transfer agent management personnel and are not disruptive to a fund.
Prospectus | 67
If a person is classified as having engaged in excessive short-term trading, the remedy will depend upon the trading activities of the investor in the account and related accounts and its disruptive effect, and can include warnings to cease such activity and/or restrictions or termination of trading privileges in a particular Fund or all of the Funds.
The Funds rely on the transfer agent to review trading activity for excessive short-term trading. There can be no assurance, however, that its monitoring activities will successfully detect or prevent all excessive short-term trading. The Funds or the transfer agent may exclude transactions below a certain dollar amount from monitoring and may change that dollar amount from time to time.
The Funds seek to apply these policies and procedures uniformly to all investors; however, some investors purchase shares of a Fund through financial intermediaries that establish omnibus accounts to invest in the Funds for their clients and submit net orders to purchase or redeem shares after combining their client orders. The Funds subject to the short-term trading policies generally treat these omnibus accounts as an individual investor and will apply the short-term trading policies to the net purchases and sales submitted by the omnibus account unless the Funds or their transfer agent have entered into an agreement requiring the omnibus account to submit the underlying trading information for their clients upon our request and/or monitor for excessive trading. For those omnibus accounts for which we have entered into agreements to monitor excessive trading or provide underlying trade information, the financial intermediary or Funds will review net activity in these omnibus accounts for activity that indicates potential, excessive short-term trading activity. If we detect suspicious trading activity at the omnibus account level, we will request underlying trading information and review the underlying trading activity to identify individual accounts engaged in excessive short-term trading activity. We will instruct the omnibus account to restrict, limit, or terminate trading privileges in a particular fund for individual accounts identified as engaging in excessive short-term trading through these omnibus accounts.
We also may rely on the financial intermediary to review for and identify underlying trading activity for individual accounts engaged in excessive short-term trading activity, and to restrict, limit, or terminate trading privileges if the financial intermediary’s policies are determined by us to be at least as stringent as the Funds’ policy. For shares purchased through financial intermediaries there may be additional or more restrictive policies. You may wish to contact your financial intermediary to determine the policies applicable to your account.
Because of the increased costs to review underlying trading information, the Funds will not enter into agreements with every financial intermediary that operates an omnibus account. The Funds or their transfer agent could decide to enter into such contracts with financial intermediaries for all funds or particular funds and can terminate such agreements at any time.
68 | USAA Index Funds
Other Fund Rights
The Funds reserve the right to:
◾Reject or restrict purchase or exchange orders when in the best interest of the Fund;
◾Limit or discontinue the offering of shares of the Fund without notice to the shareholders;
◾Calculate the NAV per share and accept purchase, exchange, and redemption orders on a business day that the NYSE is closed;
◾Redeem some or all of its shares in kind when in the best interest of the Fund;
◾Require a signature guarantee for transactions or changes in account information in those instances where the appropriateness of a signature authorization is in question (the SAI contains information on acceptable guarantors);
◾Redeem an account with less than $500, with certain limitations;
◾Restrict or liquidate an account when necessary or appropriate to comply with federal law; and
◾Discontinue or otherwise limit the opening of accounts with us.
Additional Information
The Trust enters into contractual arrangements with various parties, including, among others, the Funds' adviser, transfer agent, and distributor, who provide services to the Fund. Shareholders are not parties to, or intended (or “third-party”) beneficiaries of, any of those contractual arrangements, and those contractual arrangements are not intended to create in any individual shareholder or group of shareholders any right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the Trust or a Fund.
This prospectus provides information concerning the Trust and the Funds that you should consider in determining whether to purchase shares of a Fund. Neither this prospectus nor the related SAI is intended to be, or should be read to give rise to, an agreement or contract between the Trust or a Fund and any investor, or to give rise to any rights in any shareholder or other person other than any rights under federal or state law that may not be waived.
Prospectus | 69
Financial Highlights
The following financial highlights tables are intended to help you understand the Funds' and relevant share classes' financial performance over the past five years or since inception. Certain information reflects financial results for a single share. To the extent the Fund invests in other funds, the Total Annual Fund Operating Expenses included in the Fund’s Fees and Expenses Table may not correlate to the ratio of expenses to average net assets in the financial highlights below. The total returns in the tables represent the rate that an investor would have earned (or lost) on an investment in the Fund (assuming reinvestment of all income dividends and capital gain distributions).
The information has been derived from financial statements audited by Ernst & Young LLP, an independent registered public accounting firm, whose report, along with the Funds' financial statements, are included in each Fund’s annual report to shareholders, which is available upon request.
70 | USAA Index Funds
USAA Extended Market Index Fund
|
|
Year Ended December 31, | ||||
|
|
2021 |
2020 |
2019 |
2018 |
2017 |
|
Net Asset Value, Beginning of Period |
$25.40 |
$20.01 |
$16.14 |
$18.98 |
$17.34 |
|
Investment Activities |
|
|
|
|
|
|
Net Investment Income (Loss) |
0.22(a)
|
0.18(a)
|
0.20(a)
|
0.17 |
0.18 |
|
Net Realized and Unrealized
Gains (Losses) on Investments |
3.58 |
6.05 |
4.31 |
(1.96) |
2.88 |
|
Total from Investment Activities |
3.80 |
6.23 |
4.51 |
(1.79) |
3.06 |
|
Distributions to Shareholders From |
|
|
|
|
|
|
Net Investment Income |
(0.23) |
(0.21) |
(0.26) |
(0.17) |
(0.18) |
|
Net Realized Gains from
Investments |
(4.22) |
(0.63) |
(0.38) |
(0.88) |
(1.24) |
|
Total Distributions |
(4.45) |
(0.84) |
(0.64) |
(1.05) |
(1.42) |
|
Net Asset Value, End of Period |
$24.75 |
$25.40 |
$20.01 |
$16.14 |
$18.98 |
|
Total Return* |
15.61% |
31.20% |
27.94% |
(9.70)% |
17.72% |
|
Ratios to Average Net Assets |
|
|
|
|
|
|
Net Expenses† |
0.34% |
0.38% |
0.41% |
0.43%(b)
|
0.44% |
|
Net Investment Income (Loss) |
0.77% |
0.91% |
1.06% |
0.90%(b)
|
0.93% |
|
Gross Expenses |
0.34% |
0.38% |
0.41% |
0.43%(b)
|
0.44% |
|
Supplemental Data |
|
|
|
|
|
|
Net Assets, End of Period (000’s) |
$969,905 |
$906,111 |
$788,664 |
$656,406 |
$765,211 |
|
Portfolio Turnover |
24% |
31% |
24% |
12%(c)
|
11%(d)
|
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return.
†
The net expense ratio may not correlate to the applicable expense limits in place during the period since the current contractual expense limitation is applied for a period beginning July 1, 2019, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Refer to the Fees and Expenses in this prospectus for current contractual expense limitations.
(a)
Per share net investment income (loss) has been calculated using the average daily shares method.
(b)
Prior to February 24, 2018, the Fund was a feeder fund in a master-feeder structure investing in Master Extended Market Index Series (the “Series”) before converting to a stand-alone fund. Expenses include expenses allocated to the Fund by the Series prior to the conversion.
(c)
Reflects the period of February 24, 2018 to December 31, 2018, after the Fund converted to a stand-alone fund.
(d)
Represents the portfolio turnover of the Master Extended Market Index Series.
Prospectus | 71
USAA 500 Index Fund Member Shares
|
|
Year Ended December 31, | ||||
|
|
2021 |
2020 |
2019 |
2018 |
2017 |
|
Net Asset Value, Beginning of Period |
$51.33 |
$43.93 |
$35.22 |
$38.00 |
$31.81 |
|
Investment Activities: |
|
|
|
|
|
|
Net Investment Income (Loss) |
0.63(a)
|
0.65(a)
|
0.71(a)
|
0.68 |
0.59 |
|
Net Realized and Unrealized
Gains (Losses) on Investments |
13.37 |
8.48 |
10.19 |
(2.40) |
6.21 |
|
Total from Investment Activities |
14.00 |
9.13 |
10.90 |
(1.72) |
6.80 |
|
Distributions to Shareholders From |
|
|
|
|
|
|
Net Investment Income |
(0.63) |
(0.66) |
(0.72) |
(0.66) |
(0.59) |
|
Net Realized Gains from
Investments |
(2.47) |
(1.07) |
(1.47) |
(0.40) |
(0.02) |
|
Total Distributions |
(3.10) |
(1.73) |
(2.19) |
(1.06) |
(0.61) |
|
Net Asset Value, End of Period |
$62.23 |
$51.33 |
$43.93 |
$35.22 |
$38.00 |
|
Total Return* |
27.50% |
21.22% |
31.19% |
(4.65)% |
21.53% |
|
Ratios to Average Net Assets |
|
|
|
|
|
|
Net Expenses† |
0.24% |
0.25% |
0.25% |
0.25% |
0.25% |
|
Net Investment Income (Loss) |
1.09% |
1.47% |
1.73% |
1.75% |
1.71% |
|
Gross Expenses |
0.24% |
0.25% |
0.26% |
0.26% |
0.27% |
|
Supplemental Data |
|
|
|
|
|
|
Net Assets, End of Period (000’s) |
$4,410,258 |
$3,997,663 |
$3,603,465 |
$2,957,995 |
$3,285,829 |
|
Portfolio Turnover(b)
|
8% |
5% |
13% |
4% |
3% |
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return.
†
The net expense ratio may not correlate to the applicable expense limits in place during the period since the current contractual expense limitation is applied for a period beginning July 1, 2019, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Refer to the Fees and Expenses in this prospectus for current contractual expense limitations.
(a)
Per share net investment income (loss) has been calculated using the average daily shares method.
(b)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
72 | USAA Index Funds
USAA 500 Index Fund Reward Shares
|
|
Year Ended December 31, | ||||
|
|
2021 |
2020 |
2019 |
2018 |
2017 |
|
Net Asset Value, Beginning of Period |
$51.36 |
$43.95 |
$35.24 |
$38.01 |
$31.82 |
|
Investment Activities: |
|
|
|
|
|
|
Net Investment Income (Loss) |
0.68(a)
|
0.70(a)
|
0.75(a)
|
0.71 |
0.61 |
|
Net Realized and Unrealized
Gains (Losses) on Investments |
13.38 |
8.49 |
10.19 |
(2.38) |
6.22 |
|
Total from Investment Activities |
14.06 |
9.19 |
10.94 |
(1.67) |
6.83 |
|
Distributions to Shareholders From |
|
|
|
|
|
|
Net Investment Income |
(0.68) |
(0.71) |
(0.76) |
(0.70) |
(0.62) |
|
Net Realized Gains from
Investments |
(2.47) |
(1.07) |
(1.47) |
(0.40) |
(0.02) |
|
Total Distributions |
(3.15) |
(1.78) |
(2.23) |
(1.10) |
(0.64) |
|
Net Asset Value, End of Period |
$62.27 |
$51.36 |
$43.95 |
$35.24 |
$38.01 |
|
Total Return* |
27.62% |
21.35% |
31.29% |
(4.53)% |
21.64% |
|
Ratios to Average Net Assets |
|
|
|
|
|
|
Net Assets† |
0.15% |
0.15% |
0.15% |
0.15% |
0.15% |
|
Investment Income (Loss) |
1.17% |
1.58% |
1.83% |
1.85% |
1.81% |
|
Gross Expenses |
0.18% |
0.18% |
0.18% |
0.18% |
0.18% |
|
Supplemental Data |
|
|
|
|
|
|
Net Assets, End of Period (000’s) |
$6,638,059 |
$5,010,367 |
$4,546,094 |
$3,606,745 |
$3,636,257 |
|
Portfolio Turnover(b)
|
8% |
5% |
13% |
4% |
3% |
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return.
†
The net expense ratio may not correlate to the applicable expense limits in place during the period since the current contractual expense limitation is applied for a period beginning July 1, 2019, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Refer to the Fees and Expenses in this prospectus for current contractual expense limitations.
(a)
Per share net investment income (loss) has been calculated using the average daily shares method.
(b)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
Prospectus | 73
USAA Nasdaq-100 Index Fund Shares
|
|
Year Ended December 31, | ||||
|
|
2021 |
2020 |
2019 |
2018 |
2017 |
|
Net Asset Value, Beginning of Period |
$35.56 |
$24.35 |
$17.69 |
$17.89 |
$13.79 |
|
Investment Activities |
|
|
|
|
|
|
Net Investment Income (Loss) |
0.11(a)
|
0.13(a)
|
0.13(a)
|
0.11 |
0.07 |
|
Net Realized and Unrealized
Gains (Losses) on Investments |
9.43 |
11.62 |
6.74 |
(0.18) |
4.38 |
|
Total from Investment Activities |
9.54 |
11.75 |
6.87 |
(0.07) |
4.45 |
|
Distributions to Shareholders From |
|
|
|
|
|
|
Net Investment Income |
(0.11) |
(0.13) |
(0.13) |
(0.12) |
(0.08) |
|
Net Realized Gains from
Investments |
(1.83) |
(0.41) |
(0.08) |
(0.01) |
(0.27) |
|
Total Distributions |
(1.94) |
(0.54) |
(0.21) |
(0.13) |
(0.35) |
|
Net Asset Value, End of Period |
$43.16 |
$35.56 |
$24.35 |
$17.69 |
$17.89 |
|
Total Return* |
26.96% |
48.30% |
38.86% |
(0.44)% |
32.29% |
|
Ratios/Supplemental Data: |
|
|
|
|
|
|
Net Expenses† |
0.42% |
0.44% |
0.48% |
0.48% |
0.51% |
|
Net Investment Income (Loss) |
0.27% |
0.46% |
0.63% |
0.64% |
0.60% |
|
Gross Expenses |
0.42% |
0.44% |
0.48% |
0.48% |
0.51% |
|
Supplemental Data |
|
|
|
|
|
|
Net Assets, End of Period (000’s) |
$4,436,357 |
$3,583,838 |
$2,442,662 |
$1,750,674 |
$1,623,579 |
|
Portfolio Turnover(b)
|
10% |
17% |
9% |
5% |
5% |
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return. Total returns for periods of less than one year are not annualized.
†
The net expense ratio may not correlate to the applicable expense limit in place during the period since the current contractual expense limitation is applied for a period beginning July 1, 2019, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Refer to the Fees and Expenses in this prospectus for current contractual expense limitations.
(a)
Per share net investment income (loss) has been calculated using the average daily shares method.
(b)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
74 | USAA Index Funds
USAA Nasdaq-100 Index Fund Institutional Shares
|
|
|
Year Ended
December 31, |
Period Ended
December 31, |
|
|
|
2021 |
2020(a)
|
|
Net Asset Value, Beginning of Period |
|
$35.64 |
$27.86 |
|
Investment Activities |
|
|
|
|
Net Investment Income (Loss) |
|
0.10(b)
|
0.07(b)
|
|
Net Realized and Unrealized
Gains (Losses) on Investments |
|
9.45 |
8.17 |
|
Total from Investment Activities |
|
9.55 |
8.24 |
|
Distributions to Shareholders From |
|
|
|
|
Net Investment Income |
|
(0.10) |
(0.05) |
|
Net Realized Gains From
Investments |
|
(1.83) |
(0.41) |
|
Total Distributions |
|
(1.93) |
(0.46) |
|
Net Asset Value, End of Period |
|
$43.26 |
$35.64 |
|
Total Return*(c)
|
|
26.93% |
29.60% |
|
Ratios to Average Net Assets |
|
|
|
|
Net Expenses†(d)
|
|
0.44% |
0.44% |
|
Net Investment Income (Loss)(d)
|
|
0.25% |
0.42% |
|
Gross Expenses(d)
|
|
0.44% |
0.47% |
|
Supplemental Data |
|
|
|
|
Net Assets, End of Period (000’s) |
|
$82,846 |
$57,240 |
|
Portfolio Turnover(c)(e)
|
|
10% |
17% |
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return.
†
The net expense ratio may not correlate to the applicable expense limits in place during the period since the current contractual expense limitation is applied for a period beginning June 29, 2020, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Details of the current contractual expense limitation in effect can be found under the Fees and Expenses in this prospectus.
(a)
Commenced operations on June 29, 2020.
(b)
Per share net investment income (loss) has been calculated using the average daily shares method.
(c)
Not annualized for periods less than one year.
(d)
Annualized for periods less than one year.
(e)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
Prospectus | 75
USAA Nasdaq-100 Index Fund Class A
|
|
|
Year Ended
December 31, |
Period Ended
December 31, |
|
|
|
2021 |
2020(a)
|
|
Net Asset Value, Beginning of Period |
|
$35.64 |
$27.86 |
|
Investment Activities |
|
|
|
|
Net Investment Income (Loss) |
|
(0.01)(b)(f)
|
0.02(b)
|
|
Net Realized and Unrealized
Gains (Losses) on Investments |
|
9.44 |
8.18 |
|
Total from Investment Activities |
|
9.43 |
8.20 |
|
Distributions to Shareholders From |
|
|
|
|
Net Investment Income |
|
(0.13) |
(0.01) |
|
Net Realized Gains from
Investments |
|
(1.83) |
(0.41) |
|
Total Distributions |
|
(1.96) |
(0.42) |
|
Net Asset Value, End of Period |
|
$43.11 |
$35.64 |
|
Total Return (Excludes Sales
Charges)*(c)
|
|
26.60% |
29.46% |
|
Ratios to Average Net Assets |
|
|
|
|
Net Expenses†(d)
|
|
0.70% |
0.70% |
|
Net Investment Income (Loss)(d)
|
|
(0.02)% |
0.11% |
|
Gross Expenses(d)
|
|
1.03% |
46.74% |
|
Supplemental Data |
|
|
|
|
Net Assets, End of Period (000’s) |
|
$14,070 |
$167 |
|
Portfolio Turnover(c)(e)
|
|
10% |
17% |
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return.
†
The net expense ratio may not correlate to the applicable expense limits in place during the period since the current contractual expense limitation is applied for a period beginning June 29, 2020, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Details of the current contractual expense limitation in effect can be found under the Fees and Expenses in this prospectus.
(a)
Commenced operations on June 29, 2020.
(b)
Per share net investment income (loss) has been calculated using the average daily shares method.
(c)
Not annualized for periods less than one year.
(d)
Annualized for periods less than one year.
(e)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
(f)
The amount shown reflects a net realized and unrealized loss per share, whereas the statement of operations reflected a net realized and unrealized gain for the period for the Fund in total. The difference in realized and unrealized gains and losses for the Fund versus the class is due to the timing of sales and repurchases of the class in relation to fluctuating market values during the period.
76 | USAA Index Funds
USAA Nasdaq-100 Index Fund Class C
|
|
|
Year Ended
December 31, |
Period Ended
December 31, |
|
|
|
2021 |
2020(a)
|
|
Net Asset Value, Beginning of Period |
|
$35.51 |
$27.86 |
|
Investment Activities |
|
|
|
|
Net Investment Income (Loss) |
|
(0.33)(b)(f)
|
(0.10)(b)
|
|
Net Realized and Unrealized
Gains (Losses) on Investments |
|
9.39 |
8.16 |
|
Total from Investment Activities |
|
9.06 |
8.06 |
|
Distributions to Shareholders From |
|
|
|
|
Net Investment Income |
|
— |
— |
|
Net Realized Gains From
Investments |
|
(1.83) |
(0.41) |
|
Total Distributions |
|
(1.83) |
(0.41) |
|
Net Asset Value, End of Period |
|
$42.74 |
$35.51 |
|
Total Return (Excludes Sales
Charges)*(c)
|
|
25.67% |
28.95% |
|
Ratios to Average Net Assets |
|
|
|
|
Net Expenses†(d)
|
|
1.45% |
1.45% |
|
Net Investment Income (Loss)(d)
|
|
(0.79)% |
(0.61)% |
|
Gross Expenses(b)
|
|
2.29% |
19.93% |
|
Supplemental Data |
|
|
|
|
Net Assets, End of Period (000’s) |
|
$3,205 |
$194 |
|
Portfolio Turnover(c)(e)
|
|
10% |
17% |
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return.
†
The net expense ratio may not correlate to the applicable expense limits in place during the period since the current contractual expense limitation is applied for a period beginning June 29, 2020, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Details of the current contractual expense limitation in effect can be found under the Fees and Expenses in this prospectus.
(a)
Commenced operations on June 29, 2020.
(b)
Per share net investment income (loss) has been calculated using the average daily shares method.
(c)
Not annualized for periods less than one year.
(d)
Annualized for periods less than one year.
(e)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between classes of shares issued.
(f)
The amount shown reflects a net realized and unrealized loss per share, whereas the statement of operations reflected a net realized and unrealized gain for the period for the Fund in total. The difference in realized and unrealized gains and losses for the Fund versus the class is due to the timing of sales and repurchases of the class in relation to fluctuating market values during the period.
Prospectus | 77
USAA Nasdaq-100 Index Fund R6 Shares
|
|
|
Year Ended December 31, |
Period
Ended
December 31, | ||
|
|
2021 |
2020 |
2019 |
2018 |
2017(a)
|
|
Net Asset Value, Beginning of Period |
$35.57 |
$24.35 |
$17.68 |
$17.89 |
$15.31 |
|
Investment Activities |
|
|
|
|
|
|
Net Investment Income (Loss) |
0.15(b)
|
0.17(b)
|
0.15(b)
|
0.12 |
0.08 |
|
Net Realized and Unrealized
Gains (Losses) on Investments |
9.45 |
11.63 |
6.74 |
(0.18) |
2.87 |
|
Total from Investment Activities |
9.60 |
11.80 |
6.89 |
(0.06) |
2.95 |
|
Distributions to Shareholders From: |
|
|
|
|
|
|
Net Investment Income |
(0.15) |
(0.17) |
(0.14) |
(0.14) |
(0.10) |
|
Net Realized Gains from
Investments |
(1.83) |
(0.41) |
(0.08) |
(0.01) |
(0.27) |
|
Total Distributions |
(1.98) |
(0.58) |
(0.22) |
(0.15) |
(0.37) |
|
Net Asset Value, End of Period |
$43.19 |
$35.57 |
$24.35 |
$17.68 |
$17.89 |
|
Total Return*(c)
|
27.14% |
48.51% |
38.99% |
(0.38%) |
19.27% |
|
Ratios to Average Net Assets |
|
|
|
|
|
|
Net Expenses†(d)
|
0.30% |
0.31% |
0.39% |
0.40% |
0.40% |
|
Net Investment Income (Loss)(d)
|
0.38% |
0.59% |
0.71% |
0.72% |
0.66% |
|
Gross Expenes(d)
|
0.30% |
0.31% |
0.42% |
0.45% |
1.01% |
|
Supplemental Data |
|
|
|
|
|
|
Net Assets, End of Period (000’s) |
$42,391 |
$35,511 |
$18,877 |
$12,667 |
$5,860 |
|
Portfolio Turnover(c)(e) |
10% |
17% |
9% |
5% |
5% |
*
Assumes reinvestment of all net investment income and realized capital gain distributions, if any, during the period. Includes adjustments in accordance with U.S. Generally Accepted Accounting Principles and could differ from the Lipper reported return.
†
The net expense ratio may not correlate to the applicable expense limit in place during the period since the current contractual expense limitation is applied for a period beginning July 1, 2019, and in effect through June 30, 2023, instead of coinciding with the Fund’s fiscal year end. Refer to the Fees and Expenses in this prospectus for current contractual expense limitations.
(a)
R6 Shares commenced operations on March 1, 2017.
(b)
Per share net investment income (loss) has been calculated using the average daily shares method.
(c)
Not annualized for periods less than one year.
(d)
Annualized for periods less than one year.
(e)
Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued.
78 | USAA Index Funds
Appendix A — Variations in Sales Charge Reductions and Waivers Available Through Certain Intermediaries
The availability of certain initial and contingent deferred sales charge reductions and waivers may depend on the particular financial intermediary or type of account through which you purchase or hold Fund shares. The following information about variations in sales charge reductions and waivers is applicable only to investors who purchase Fund shares through a Merrill Lynch, Ameriprise Financial, Morgan Stanley Wealth Management, Raymond James, Janney Montgomery Scott, Edward D. Jones & Co., L.P., or Robert W. Baird & Co. platform or account.
In all instances, it is your responsibility to notify the Fund or your financial intermediary at the time of purchase of any relationship or other facts qualifying you for sales charge reductions or waivers. For reductions and waivers not available through a particular intermediary, shareholders will have to purchase Fund shares directly from the Fund or through another intermediary to receive those reductions and waivers.
Merrill Lynch
Shareholders purchasing Fund shares through a Merrill Lynch platform or account will be eligible only for the following load waivers (front-end sales charge waivers and contingent deferred, or back-end, sales charge waivers) and discounts, which may differ from those disclosed elsewhere in this Fund's Prospectus or in the SAI.
Front-End Sales Charge Waivers on Class A Shares available at Merrill Lynch
◾Employer-sponsored retirement, deferred compensation and employee benefit plans (including health savings accounts) and trusts used to fund those plans, provided that the shares are not held in a commission-based brokerage account and shares are held for the benefit of the plan
◾Shares purchased by a 529 Plan (does not include 529 Plan units or 529-specific share classes or equivalents)
◾Shares purchased through a Merrill Lynch affiliated investment advisory program
◾Shares exchanged due to the holdings moving from a Merrill Lynch affiliated investment advisory program to a Merrill Lynch brokerage (non-advisory) account pursuant to Merrill Lynch’s policies relating to sales load discounts and waivers
| 79
◾Shares purchased by third party investment advisors on behalf of their advisory clients through Merrill Lynch's platform
◾Shares of funds purchased through the Merrill Edge Self-Directed platform (if applicable)
◾Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family)
◾Shares exchanged from Class C (i.e. level-load) shares of the same fund pursuant to Merrill Lynch's policies relating to sales load discounts and waivers
◾Employees and registered representatives of Merrill Lynch or its affiliates and their family members
◾Directors or Trustees of the Fund, and employees of the Fund's investment adviser or any of its affiliates, as described in this Prospectus
◾Eligible shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (known as Rights of Reinstatement). Automated transactions (i.e. systematic purchases and withdrawals) and purchases made after shares are automatically sold to pay Merrill Lynch’s account maintenance fees are not eligible for reinstatement
CDSC Waivers on A and C Shares available at Merrill Lynch
◾Death or disability of the shareholder
◾Shares sold as part of a systematic withdrawal plan as described in the Fund's Prospectus
◾Return of excess contributions from an IRA Account
◾Shares sold as part of a required minimum distribution for IRA and retirement accounts pursuant to the Internal Revenue Code
◾Shares sold to pay Merrill Lynch fees but only if the transaction is initiated by Merrill Lynch
◾Shares acquired through a right of reinstatement
◾Shares held in retirement brokerage accounts, that are exchanged for a lower cost share class due to transfer to a fee based account or platform (applicable to A and C shares only)
80 |
◾Shares received through an exchange due to the holdings moving from a Merrill Lynch affiliated investment advisory program to a Merrill Lynch brokerage (non-advisory) account pursuant to Merrill Lynch’s policies relating to sales load discounts and waivers
Front-end load Discounts Available at Merrill Lynch: Breakpoints, Rights of Accumulation & Letters of Intent
◾Breakpoints as described in this Prospectus
◾Rights of Accumulation (ROA) which entitle shareholders to breakpoint discounts as described in the Fund’s prospectus will be automatically calculated based on the aggregated holding of fund family assets held by accounts (including 529 program holdings, where applicable) within the purchaser’s household at Merrill Lynch. Eligible fund family assets not held at Merrill Lynch may be included in the ROA calculation only if the shareholder notifies his or her financial advisor about such assets
◾Letters of Intent (LOI) which allow for breakpoint discounts based on anticipated purchases within a fund family, through Merrill Lynch, over a 13-month period of time (if applicable)
Ameriprise Financial
Class A Shares Front-End Sales Charge Waivers Available at Ameriprise Financial
Shareholders purchasing Fund shares through an Ameriprise Financial brokerage account are eligible for the following front-end sales charge waivers, which may differ from those disclosed elsewhere in this Fund’s prospectus or SAI:
◾Employer-sponsored retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b) plans, profit sharing and money purchase pension plans and defined benefit plans). For purposes of this provision, employer-sponsored retirement plans do not include SEP IRAs, Simple IRAs or SAR-SEPs.
◾Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same Fund (but not any other fund within the same fund family).
◾Shares exchanged from Class C shares of the same fund in the month of or following the 7-year anniversary of the purchase date. To the extent that this prospectus elsewhere provides for a waiver with respect to exchanges of Class C shares or conversion of Class C shares following a shorter holding period, that waiver will apply.
◾Employees and registered representatives of Ameriprise Financial or its affiliates and their immediate family members.
| 81
◾Shares purchased by or through qualified accounts (including IRAs, Coverdell Education Savings Accounts, 401(k)s, 403(b) TSCAs subject to ERISA and defined benefit plans) that are held by a covered family member, defined as an Ameriprise financial advisor and/or the advisor’s spouse, advisor’s lineal ascendant (mother, father, grandmother, grandfather, great grandmother, great grandfather), advisor’s lineal descendant (son, step-son, daughter, step-daughter, grandson, granddaughter, great grandson, great granddaughter) or any spouse of a covered family member who is a lineal descendant.
◾Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (i.e. Rights of Reinstatement).
Morgan Stanley Wealth Management
Shareholders purchasing Fund shares through a Morgan Stanley Wealth Management transactional brokerage account are eligible only for the following front-end sales charge waivers with respect to Class A shares, which may differ from and may be more limited than those disclosed elsewhere in the Fund's Prospectus or SAI.
Front-end Sales Charge Waivers on Class A Shares available at Morgan Stanley
◾Employer-sponsored retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b) plans, profit sharing and money purchase pension plans and defined benefit plans). For purposes of this provision, employer-sponsored retirement plans do not include SEP IRAs, Simple IRAs, SAR-SEPs or Keogh plans
◾Morgan Stanley employee and employee-related accounts according to Morgan Stanley's account linking rules
◾Shares purchased through reinvestment of dividends and capital gains distributions when purchasing shares of the same fund
◾Shares purchased through a Morgan Stanley self-directed brokerage account
◾Class C (i.e., level-load) shares that are no longer subject to a contingent deferred sales charge and are converted to Class A shares of the same fund pursuant to Morgan Stanley Wealth Management’s share class conversion program
82 |
◾Shares purchased from the proceeds of redemptions within the same fund family, provided (i) the repurchase occurs within 90 days following the redemption, (ii) the redemption and purchase occur in the same account, and (iii) redeemed shares were subject to a front-end or deferred sales charge
Raymond James & Associates, Inc., Raymond James Financial Services, Inc. and each entity’s affiliates (“Raymond James”)
Shareholders purchasing fund shares through a Raymond James platform or account, or through an introducing broker-dealer or independent registered investment adviser for which Raymond James provides trade execution, clearance, and/or custody services, will be eligible only for the following load waivers (front-end sales charge waivers and contingent deferred, or back-end, sales charge waivers) and discounts, which may differ from those disclosed elsewhere in this Fund's Prospectus or SAI.
Front-End Sales Charge Waivers on Class A Shares available at Raymond James
◾Shares purchased in an investment advisory program
◾Shares purchased within the same fund family through a systematic reinvestment of capital gains and dividend distributions
◾Employees and registered representatives of Raymond James or its affiliates and their family members as designated by Raymond James
◾Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (known as Rights of Reinstatement)
◾A shareholder in the Fund's Class C shares will have their shares converted at net asset value to Class A shares (or the appropriate share class) of the Fund if the shares are no longer subject to a CDSC and the conversion is in line with the policies and procedures of Raymond James
CDSC Waivers on Classes A and C Shares available at Raymond James
◾Death or disability of the shareholder
◾Shares sold as part of a systematic withdrawal plan as described in the Fund's Prospectus
◾Return of excess contributions from an IRA Account
| 83
◾Shares sold as part of a required minimum distribution for IRA and retirement accounts due to the shareholder reaching the qualified age based on applicable IRS regulations as described in the fund's prospectus
◾Shares sold to pay Raymond James fees but only if the transaction is initiated by Raymond James
◾Shares acquired through a right of reinstatement
Front-End Load Discounts Available at Raymond James: Breakpoints, Rights of Accumulation, and/or Letters of Intent
◾Breakpoints as described in this Prospectus
◾Rights of Accumulation which entitle shareholders to breakpoint discounts will be automatically calculated based on the aggregated holding of fund family assets held by accounts within the purchaser's household at Raymond James. Eligible fund family assets not held at Raymond James may be included in the calculation of rights of accumulation only if the shareholder notifies his or her financial advisor about such assets
◾Letters of intent which allow for breakpoint discounts based on anticipated purchases within a fund family, over a 13-month time period. Eligible fund family assets not held at Raymond James may be included in the calculation of letters of intent only if the shareholder notifies his or her financial advisor about such assets
Janney Montgomery Scott LLC (“Janney”)
Shareholders purchasing fund shares through a Janney brokerage account will be eligible only for the following load waivers (front-end sales charge waivers and contingent deferred sales charge (“CDSC”), or back-end, sales charge waivers) and discounts, which may differ from those disclosed elsewhere in this Fund's Prospectus or SAI.
Front-End Sales Charge Waivers on Class A shares available at Janney1
◾Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family)
◾Shares purchased by employees and registered representatives of Janney or its affiliates and their family members as designated by Janney
◾Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within ninety (90) days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (i.e., right of reinstatement)
84 |
◾Employer-sponsored retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b) plans, profit sharing and money purchase pension plans and defined benefit plans). For purposes of this provision, employer-sponsored retirement plans do not include SEP IRAs, Simple IRAs, SAR-SEPs or Keogh plans
◾Shares acquired through a right of reinstatement
◾Class C shares that are no longer subject to a contingent deferred sales charge and are converted to Class A shares of the same fund pursuant to Janney’s policies and procedures
CDSC Waivers on Class A and C shares available at Janney
◾Shares sold upon the death or disability of the shareholder
◾Shares sold as part of a systematic withdrawal plan as described in the fund’s Prospectus
◾Shares purchased in connection with a return of excess contributions from an IRA account
◾Shares sold as part of a required minimum distribution for IRA and other retirement accounts due to the shareholder reaching the qualified age based on applicable Internal Revenue Service regulations as described in the fund’s Prospectus.
◾Shares sold to pay Janney fees but only if the transaction is initiated by Janney
◾Shares acquired through a right of reinstatement
◾Shares exchanged into the same share class of a different fund.
Front-End Load Discounts available at Janney: Breakpoints, Rights of Accumulation and/or letters of intent1
◾Breakpoints as described in this Prospectus
◾Rights of accumulation (“ROA”), which entitle shareholders to breakpoint discounts, will be automatically calculated based on the aggregated holding of fund family assets held by accounts within the purchaser’s household at Janney. Eligible fund family assets not held at Janney may be included in the ROA calculation only if the shareholder notifies his or her financial advisor about such assets
◾Letters of intent which allow for breakpoint discounts based on anticipated purchases within a fund family, over a 13-month time period. Eligible fund family assets not held at Janney may be included in the calculation of letters of intent only if the shareholder notifies his or her financial advisor about such assets
1 Also referred to as an “initial sales charge.”
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Edward D. Jones & Co., L.P. (“Edward Jones”)
The following information supersedes prior information with respect to transactions and positions held in fund shares through an Edward Jones system. Clients of Edward Jones (also referred to as “shareholders”) purchasing fund shares on the Edward Jones commission and fee-based platforms are eligible only for the following sales charge discounts (also referred to as “breakpoints”) and waivers, which can differ from discounts and waivers described elsewhere in the mutual fund prospectus or statement of additional information (“SAI”) or through another broker-dealer. In all instances, it is the shareholder's responsibility to inform Edward Jones at the time of purchase of any relationship, holdings of the USAA Mutual Funds, or other facts qualifying the purchaser for discounts or waivers. Edward Jones can ask for documentation of such circumstance. Shareholders should contact Edward Jones if they have questions regarding their eligibility for these discounts and waivers.
Breakpoints available at Edward Jones
◾Breakpoint pricing, otherwise known as volume pricing, at dollar thresholds as described in the prospectus.
Rights of Accumulation (“ROA”)
◾The applicable sales charge on a purchase of Class A shares is determined by taking into account all share classes (except certain money market funds and any assets held in group retirement plans) of the mutual fund family held by the shareholder or in an account grouped by Edward Jones with other accounts for the purpose of providing certain pricing considerations (“pricing groups”). If grouping assets as a shareholder, this includes all share classes held on the Edward Jones platform and/or held on another platform. The inclusion of eligible fund family assets in the ROA calculation is dependent on the shareholder notifying Edward Jones of such assets at the time of calculation. Money market funds are included only if such shares were sold with a sales charge at the time of purchase or acquired in exchange for shares purchased with a sales charge.
◾The employer maintaining a SEP IRA plan and/or SIMPLE IRA plan may elect to establish or change ROA for the IRA accounts associated with the plan to a plan-level grouping as opposed to including all share classes at a shareholder or pricing group level.
◾ROA is determined by calculating the higher of cost minus redemptions or market value (current shares x NAV).
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Letter of Intent (“LOI”)
◾Through a LOI, shareholders can receive the sales charge and breakpoint discounts for purchases shareholders intend to make over a 13-month period from the date Edward Jones receives the LOI. The LOI is determined by calculating the higher of cost or market value of qualifying holdings at LOI initiation in combination with the value that the shareholder intends to buy over a 13-month period to calculate the front-end sales charge and any breakpoint discounts. Each purchase the shareholder makes during that 13-month period will receive the sales charge and breakpoint discount that applies to the total amount. The inclusion of eligible fund family assets in the LOI calculation is dependent on the shareholder notifying Edward Jones of such assets at the time of calculation. Purchases made before the LOI is received by Edward Jones are not adjusted under the LOI and will not reduce the sales charge previously paid. Sales charges will be adjusted if LOI is not met.
◾If the employer maintaining a SEP IRA plan and/or SIMPLE IRA plan has elected to establish or change ROA for the IRA accounts associated with the plan to a plan-level grouping, LOIs will also be at the plan-level and may only be established by the employer.
Sales Charge Waivers available at Edward Jones
Sales charges are waived for the following shareholders and in the following situations:
◾Associates of Edward Jones and its affiliates and their family members who are in the same pricing group (as determined by Edward Jones under its policies and procedures) as the associate. This waiver will continue for the remainder of the associate's life if the associate retires from Edward Jones in good-standing and remains in good standing pursuant to Edward Jones’ policies and procedures.
◾Shares purchased in an Edward Jones fee-based program.
◾Shares purchased through reinvestment of capital gains distributions and dividend reinvestment.
◾Shares purchased from the proceeds of redeemed shares of the same fund family so long as the following conditions are met: 1) the proceeds are from the sale of shares within 60 days of the purchase, and 2) the sale and purchase are made in the same share class and the same account or the purchase is made in an individual retirement account with proceeds from liquidations in a non-retirement account.
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◾Shares exchanged into Class A shares from another share class so long as the exchange is into the same fund and was initiated at the discretion of Edward Jones. Edward Jones is responsible for any remaining CDSC due to the fund company, if applicable. Any future purchases are subject to the applicable sales charge as disclosed in the prospectus.
◾Exchanges from Class C shares to Class A shares of the same fund, generally, in the 84th month following the anniversary of the purchase date or earlier at the discretion of Edward Jones.
Contingent Deferred Sales Charge (“CDSC”) Waivers available at Edward Jones
If the shareholder purchases shares that are subject to a CDSC and those shares are redeemed before the CDSC is expired, the shareholder is responsible to pay the CDSC except in the following conditions:
◾The death or disability of the shareholder.
◾Systematic withdrawals with up to 10% per year of the account value.
◾Return of excess contributions from an Individual Retirement Account (“IRA”).
◾Shares sold as part of a required minimum distribution for IRA and retirement accounts if the redemption is taken in or after the year the shareholder reaches qualified age based on applicable IRS regulations.
◾Shares sold to pay Edward Jones fees or costs in such cases where the transaction is initiated by Edward Jones.
◾Shares exchanged in an Edward Jones fee-based program.
◾Shares acquired through NAV reinstatement.
◾Shares redeemed at the discretion of Edward Jones for Minimum Balances, as described below.
Other Important Information Regarding Transactions Through Edward Jones
Minimum Purchase Amounts
◾Initial purchase minimum: $250
◾Subsequent purchase minimum: none
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Minimum Balances
Edward Jones has the right to redeem at its discretion fund holdings with a balance of $250 or less. The following are examples of accounts that are not included in this policy:
◾A fee-based account held on an Edward Jones platform
◾A 529 account held on an Edward Jones platform
◾An account with an active systematic investment plan or LOI
Exchanging Share Classes
◾At any time it deems necessary, Edward Jones has the authority to exchange at NAV a shareholder's holdings in a fund to Class A shares of the same fund.
Oppenheimer & Co. Inc. (“OPCO”)
Shareholders purchasing Fund shares through an Oppenheimer & Co. Inc. platform or account are eligible only for the following load waivers (front-end sales charge waivers and contingent deferred, or back-end, sales charge waivers) and discounts, which may differ from those disclosed elsewhere in this Fund’s prospectus or SAI.
Front-End Sales Charge Waivers on Class A Shares available at OPCO
◾Employer-sponsored retirement, deferred compensation and employee benefit plans (including health savings accounts) and trusts used to fund those plans, provided that the shares are not held in a commission-based brokerage account and shares are held for the benefit of the plan
◾Shares purchased by or through a 529 Plan
◾Shares purchased through an OPCO affiliated investment advisory program
◾Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family)
◾Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (known as Rights of Restatement)
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◾A shareholder in the Fund’s Class C shares will have their shares converted at net asset value to Class A shares (or the appropriate share class) of the Fund if the shares are no longer subject to a CDSC and the conversion is in line with the policies and procedures of OPCO
◾Employees and registered representatives of OPCO or its affiliates and their family members
◾Directors or Trustees of the Fund, and employees of the Fund’s investment adviser or any of its affiliates, as described in this prospectus
CDSC Waivers on A and C Shares available at OPCO
◾Death or disability of the shareholder
◾Shares sold as part of a systematic withdrawal plan as described in the Fund's Prospectus
◾Return of excess contributions from an IRA Account
◾Shares sold as part of a required minimum distribution for IRA and retirement accounts due to the shareholder reaching the qualified age based on applicable IRS regulations as described in the prospectus
◾Shares sold to pay OPCO fees but only if the transaction is initiated by OPCO
◾Shares acquired through a right of reinstatement
Front-end load Discounts Available at OPCO: Breakpoints, Rights of Accumulation & Letters of Intent
◾Breakpoints as described in this Prospectus
◾Rights of Accumulation (ROA) which entitle shareholders to breakpoint discounts will be automatically calculated based on the aggregated holding of fund family assets held by accounts within the purchaser’s household at OPCO. Eligible fund family assets not held at OPCO may be included in the ROA calculation only if the shareholder notifies his or her financial advisor about such assets
Waivers Specific to Stifel, Nicolaus & Company, Incorporated (“Stifel”)
Shareholders purchasing Fund shares through a Stifel platform or account or who own shares for which Stifel or an affiliate is the broker-dealer of record are eligible for the following additional sales charge waiver.
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Front-end Sales Load Waiver on Class A Shares
◾Class C shares that have been held for more than seven (7) years will be converted to Class A shares of the same Fund pursuant to Stifel’s policies and procedures
All other sales charge waivers and reductions described elsewhere in the Fund’s Prospectus or SAI still apply.
Robert W. Baird & Co. (“Baird”):
Effective June 15, 2020, shareholders purchasing fund shares through a Baird platform or account will only be eligible for the following sales charge waivers (front-end sales charge waivers and CDSC waivers) and discounts, which may differ from those disclosed elsewhere in this prospectus or the SAI
Front-End Sales Charge Waivers on Investors A-shares Available at Baird
◾Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund
◾Shares purchase by employees and registers representatives of Baird or its affiliate and their family members as designated by Baird
◾Shares purchased using the proceeds of redemptions from a USAA Mutual Fund, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same accounts, and (3) redeemed shares were subject to a front-end or deferred sales charge (known as rights of reinstatement)
◾A shareholder in the Funds Investor C Shares will have their share converted at net asset value to Investor A shares of the same fund if the shares are no longer subject to CDSC and the conversion is in line with the policies and procedures of Baird
◾Employer-sponsored retirement plans or charitable accounts in a transactional brokerage account at Baird, including 401(k) plans, 457 plans, employer-sponsored 403(b) plans, profit sharing and money purchase pension plans and defined benefit plans. For purposes of this provision, employer-sponsored retirement plans do not include SEP IRAs, Simple IRAs or SAR-SEPs
CDSC Waivers on Investor A and C shares Available at Baird
◾Shares sold due to death or disability of the shareholder
◾Shares sold as part of a systematic withdrawal plan as described in the Fund’s Prospectus
◾Shares bought due to returns of excess contributions from an IRA Account
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◾Shares sold as part of a required minimum distribution for IRA and retirement accounts due to the shareholder reaching the qualified age based on applicable Internal Revenue Service regulations as described in the Fund’s prospectus
◾Shares sold to pay Baird fees but only if the transaction is initiated by Baird
◾Shares acquired through a right of reinstatement
Front-End Sales Charge Discounts Available at Baird: Breakpoints and/or Rights of Accumulations
◾Breakpoints as described in this prospectus
◾Rights of accumulations which entitles shareholders to breakpoint discounts will be automatically calculated based on the aggregated holding of USAA Mutual Funds assets held by accounts within the purchaser’s household at Baird. Eligible USAA Mutual Funds assets not held at Baird may be included in the rights of accumulations calculation only if the shareholder notifies his or her financial advisor about such assets
◾Letters of Intent (LOI) allow for breakpoint discounts based on anticipated purchases of USAA Mutual Funds through Baird, over a 13-month period of time
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Additional Information on the Wilshire 4500 Completion Index
Wilshire®, the Wilshire IndexesSM and Wilshire 4500 Completion IndexSM are service marks of Wilshire Associates Incorporated (“Wilshire”) and have been licensed by the Adviser for use by USAA Extended Market Index Fund (“Fund”). All content of the Wilshire IndexesSM and Wilshire 4500 Completion IndexSM is ©2019 Wilshire Associates Incorporated, all rights reserved. Wilshire has no relationship with the Fund, other than the licensing of the Wilshire 4500 Completion IndexSM and its service marks for use in connection with the Fund.
Wilshire does not:
◾sponsor, endorse, sell or promote the Fund.
◾recommend that any person invest in the Fund or any other securities.
◾have any responsibility or liability for or make any decisions about the timing, amount or pricing of the Fund.
◾have any responsibility or liability for the administration, management or marketing of the Fund.
◾consider the needs of the Fund or the owners of the Fund in determining, composing or calculating the Wilshire 4500 Completion IndexSM or have any obligation to do so.
Wilshire shall have no liability in connection with the Fund. Specifically,
◾Wilshire makes no representation or warranty, express or implied, regarding:
◾The results to be obtained by the Fund, the owner of the Fund or any other person in connection with the use of the Wilshire 4500 Completion IndexSM and the data included in the Wilshire 4500 Completion IndexSM;
◾The accuracy or completeness of the Wilshire 4500 Completion IndexSM and any related data;
◾The merchantability or the fitness for a particular purpose or use of the Wilshire 4500 Completion IndexSM and/or its related data;
◾Wilshire shall not have any liability for any errors, omissions or interruptions in the Wilshire 4500 Completion IndexSM or related data;
◾Under no circumstances will Wilshire be liable for any lost profits or indirect, punitive, special or consequential damages or losses, even if Wilshire knows that they might occur.
The licensing agreement between Wilshire and the Adviser is solely for their benefit and not for the benefit of the owners of the Fund or any other third parties.
Prospectus | 93
Additional Information on the Nasdaq-100 Index
The Nasdaq-100 Index Fund is not sponsored, endorsed, sold, or promoted by The Nasdaq Stock Market, Inc. (including its affiliates) (Nasdaq, with its affiliates, are referred to as the “Corporations”). The Corporations have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to, the Fund. The Corporations make no representation or warranty, express or implied, to the owners of the Fund or any member of the public regarding the advisability of investing in securities generally or in the Fund particularly, or the ability of the Nasdaq-100 Index® to track general stock market performance. The Corporations’ only relationship to USAA Mutual Funds Trust (“Licensee”) is in the licensing of the Nasdaq-100®, Nasdaq-100 Index®, and Nasdaq® trademarks or service marks, certain trade names of the Corporations and the use of the Nasdaq-100 Index® which is determined, composed and calculated by Nasdaq without regard to the Licensee or the Fund. Nasdaq has no obligation to take the needs of the Licensee or the owners of the Fund into consideration in determining, composing or calculating the Nasdaq-100 Index®. The Corporations are not responsible for and have not participated in the determination of the timing of, prices at, or quantities of the Fund to be issued or in the determination or calculation of the equation by which the Fund is to be converted into cash. The Corporations have no liability in connection with the administration, marketing or trading of the Fund.
The Corporations do not guarantee the accuracy and/or uninterrupted calculation of the Nasdaq-100 Index® or any data included therein. The Corporations make no warranty, express or implied, as to results to be obtained by the Licensee, owners of the Fund, or any other person or entity from the use of the Nasdaq-100 Index® or any data included therein. The Corporations make no express or implied warranties, and expressly disclaim all warranties of merchantability or fitness for a particular purpose or use with respect to the Nasdaq-100 Index® or any data included therein. Without limiting any of the foregoing, in no event shall the Corporations have any liability for any lost profits or special, incidental, punitive, indirect, or consequential damages, even if notified of the possibility of such damages.
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Statement of Additional Information (“SAI”): A complete description of the Funds' policies and procedures with respect to the disclosure of the Funds' portfolio securities is available in the Funds' SAI. The SAI has been filed with the Securities and Exchange Commission (“SEC”) and is incorporated by reference into this prospectus, which means it is legally part of the prospectus.
Annual and Semi Annual Reports: Annual and semi annual reports contain more information about the Funds' investments. In the Funds' annual report, you will find a discussion of the market conditions and investment strategies that significantly affected the Funds' performance during the last fiscal year.
How to Obtain Information: You may obtain a free copy of the SAI, annual or semi annual reports, or to ask other questions about the Funds or your accounts, online at VictoryFunds.com, by contacting the USAA Mutual Funds at the address or telephone number below, or by contacting your financial intermediary.
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By mail:
USAA Mutual Funds
P.O. Box 182593
Columbus, OH 43218-2593 |
By telephone:
Call USAA Mutual Funds at
(800) 235-8396 |
You also can obtain information about each Fund (including the SAI and other reports) from the SEC on the SEC’s EDGAR database at http://www.sec.gov or, after payment of a duplicating fee, by electronic request at the following e-mail address: publicinfo@sec.gov
Investment Company Act File No. 811-7852
28082-0522
