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Investment Opportunity

This portfolio pursues long-term capital appreciation in the small-cap sector while seeking to provide the risk characteristics of the less volatile large-cap S&P 500 Index. The portfolio invests in a select group of small-cap growth companies believed to be undervalued relative to their future growth potential. The investment strategy emphasizes companies with a competitive advantage, strong management and low financial risk that are able to grow over market cycles, despite their discounted valuations.

Effective April 28, 2017 this Series changed its name from the Virtus Small-Cap Growth Series.

Fund Risks

Equity Securities: The market price of equity securities may be adversely affected by financial market, industry, or issuer-specific events. Focus on a particular style or on small or medium-sized companies may enhance that risk.

Limited Number of Investments: Because the fund has a limited number of securities, it may be more susceptible to factors adversely affecting its securities than a less concentrated fund.

Industry/Sector Concentration: A fund that focuses its investments in a particular industry or sector will be more sensitive to conditions that affect that industry or sector than a non-concentrated fund.

Prospectus: For additional information on risks, please see the fund's prospectus.

Key Stats (as of 6/26/2017)

Inception: 8/12/2002
CUSIP: 92829L604
Net Assets by Fund: $71,075,101
Net Assets by Class: $69,740,278

Management Team

Jon Christensen, CFA
Jon Christensen, CFA Kayne Anderson Rudnick Investment Management, LLC

Industry start date: 1995

Start date with Series: 2010

Todd Beiley, CFA
Todd Beiley, CFA Kayne Anderson Rudnick Investment Management, LLC

Industry start date: 1999

Start date with Series: 2010

Kayne Anderson Rudnick Investment Management, LLC

Kayne Anderson Rudnick believes that superior risk-adjusted returns can be achieved through investment in high-quality companies with global dominance, excellent management, financial strength, and consistent growth purchased at reasonable prices.

Morningstar Ratings

Overall Rating

As of 5/31/2017 the Fund was rated 5 stars out of 73 funds, 5 stars out of 71 funds and 5 stars out of 61 funds within the Small Growth category for the 3-, 5- and 10 year periods, respectively.

Strong ratings are not indicative of positive fund performance.

Average Annual Total Returns

Monthly Performance (%) (as of 5/31/2017)
  3 Mon. YTD 1YR 3YR 5YR 10YR Since Inception
NAV 10.42 15.73 35.61 19.20 19.15 8.41 12.18
Quarterly Performance (%) (as of 3/31/2017)
  3 Mon. YTD 1YR 3YR 5YR 10YR Since Inception
NAV 5.92 5.92 25.68 14.22 15.27 8.21 11.65
Index 5.35 5.35 23.03 6.72 12.10 8.06 NA

Index: Russell 2000® Growth Index
The Russell 2000® Growth Index is a market capitalization-weighted index of growth-oriented stocks of the smallest 2,000 companies in the Russell Universe, which comprises the 3,000 largest U.S. companies. The index is calculated on a total return basis with dividends reinvested. The index is unmanaged, its returns do not reflect any fees, expenses, or sales charges, and is not available for direct investment.

Sales Charge and Expense

The fund class gross expense ratio is 1.36%. The net expense ratio is 1.19%, which reflects a contractual expense reimbursement in effect through 04/30/2018.

Risk Statistics3 (as of 3/31/2017)

  Fund Index
R2 0.74 1.00
Beta 0.76 1.00
Alpha 8.39 0.00
Std Dev 14.44 16.39
Index: Russell 2000® Growth Index

Daily Price (as of 6/26/2017)

NAV Change ($)
25.30 -0.03

Top Holdings (% Series)
(as of 3/31/2017)

Ollie's Bargain Outlet Holdings Inc 6.79
Fox Factory Holding Corp. 6.38
NVE Corporation 6.09
HEICO Corporation Class A 5.25
Autohome, Inc. Sponsored ADR Class A 5.19
National Research Corporation Class A 4.93
Aspen Technology, Inc. 4.39
Old Dominion Freight Line, Inc. 4.29
Abaxis, Inc. 4.19
Copart, Inc. 4.17

Top Sectors (% Equity)
(as of 3/31/2017)

Technology 24.62
Consumer Discretionary 22.26
Producer Durables 16.16
Financial Services 15.33
Health Care 9.82

(as of 3/31/2017)

Avg Weighted Market Cap (bn) $3.32
Median Market Cap (bn) $2.76
Trailing P/E 29.38x
Price-to-Cash Flow 25.57
Price-to-Book Value 5.04
3-Year EPS Growth Rate 6.11

Morningstar Ratings

Overall Rating

As of 5/31/2017 the Fund was rated 5 stars out of 73 funds, 5 stars out of 71 funds and 5 stars out of 61 funds within the Small Growth category for the 3-, 5- and 10 year periods, respectively.

Strong ratings are not indicative of positive fund performance.

Performance data quoted represents past results. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, so your shares, when redeemed, may be worth more or less than their original cost.

Returns for periods of less than one year are cumulative total returns.

The investments for the Series are managed by the same portfolio manager(s) who manage one or more other funds that have similar names, investment objectives and investment styles as the Series. You should be aware that the Series is likely to differ from the other mutual funds in size, cash flow pattern and tax matters. Accordingly, the holdings and performance of the Series can be expected to vary from those of the other mutual funds.

Shares of the separate Series of Virtus Variable Insurance Trust are sold only through the currently effective prospectuses and are not available to the general public. Shares of the VIT Series may be purchased only by life insurance companies to be used with their separate accounts which fund variable annuity and variable life insurance policies or qualified retirement plans and are also available as an underlying investment fund for certain qualified retirement plans. The performance information for the Series does not reflect fees and expenses of the insurance companies. If such fees and expenses were deducted, performance would be lower.

Please carefully consider the investment objectives, risks, charges, and expenses of the Series before investing. For this and other information about any Virtus Variable Insurance Trust Series, call 1-800-367-5877 or visit for a prospectus and/or summary prospectus. Read it carefully before you invest or send money.

Morningstar Disclosures:
For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating™ based on a Morningstar Risk-Adjusted Return measure that accounts for a variation in a fund’s monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in an investment category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a fund is derived from a weighted average of the performance figures associated with its 3-, 5-, and 10-year (if applicable) Morningstar Rating metrics. Ratings are for the A Shares as shown only; other share classes bear different fees and expenses, which affect performance.

Load-waived A share star ratings do not include any front-end sales load and are intended for those investors who have access to such purchase terms (e.g., plan participants of a defined contribution plan). Not all A share mutual funds for which Morningstar calculates a load-waived A share star rating may actually waive their front-end sales load. Therefore, Morningstar strongly encourages investors to contact their investment professional to determine whether they are eligible to purchase the A share without paying the front load.

© 2013 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results

1 Yields/Distributions: Distribution Yield (at NAV) is calculated by annualizing the latest month's distribution and dividing by the NAV on the last business day of the period. SEC Yield represents the net investment income earned by a fund over a 30-day period (7-day period for Money Market Funds), expressed as an annual percentage rate based on the fund's public offering share price at the end of the 30-day period (7-day period for Money Market Funds).

2 Distribution History: Distributions are represented on a cash basis and may be reclassified at year end for tax purposes. The Fund will send you a Form 1099-DIV for the calendar year that will tell you how to report these distributions for federal income tax purposes. STCG: Short Term Capital Gain, LTCG: Long Term Capital Gain

3 Risk Statistics: R2 is a statistical measure that represents the percentage of a fund or security's movements that can be explained by movements in a benchmark index. Beta is a quantitative measure of the volatility of a given portfolio to the overall market. Alpha is a risk adjusted measure of an investment's excess return relative to a benchmark. A positive Alpha indicates that the investment produced a return greater than expected for the risk (as measured by Beta) taken. Standard Deviation measures variability of returns around the average return for an investment fund. Higher standard deviation suggests greater risk. Risk Statistics are calculated using 36 monthly returns.

4 Characteristics: For Equity Funds:Trailing P/E: Per-share stock price divided by the latest12-months Earnings per Share; Price/Cash Flow: Per-share stock price divided by the per-share operating cash flow; Price/Book: Per-share stock price divided by the latest 12-month per-share Book Value; 3-Year EPS Growth Rate: Average of earnings per share growth for latest 3-year period. The 3-Year EPS Growth Rate is not a forecast of the fund's performance.

Not insured by FDIC/NCUSIF or any federal government agency. No bank guarantee. Not a deposit. May lose value.

Distributed by VP Distributors, LLC, member FINRA and subsidiary of Virtus Investment Partners, Inc.