Company: NCZ-PA
Filing Date: 2025-04-11
Form Type: N-CSR
Source: 0001193125-25-079060
Chunk: 11

Company: Virtus Convertible & Income Fund II
Filing Date: 2025-04-11
Form: N-CSR
Chunk 11
---
 calculated assuming a purchase of common shares on the opening of the first day and sale on the closing of the last day of each period reported. Dividends and distributions are assumed, for purposes of this calculation, to 
 be reinvested at prices obtained under the Fund’s Automatic Reinvestment and Cash Purchase Plan. Total return on market value is not annualized for periods of less than one year. Brokerage commissions that a shareholder may pay are not              
 reflected. Total return on market value does not reflect the deduction of taxes that a shareholder may pay on Fund distributions or the sale of Fund shares. Total return on net asset value uses the same methodology, but with use of net asset value  
 for the beginning, ending and reinvestment values.                                                                                                                                                                                                       |
| 3 | The                                                                                                                                                                                                                                                      
 index is unmanaged and not available for direct investment; therefore, its performance does not reflect the expenses associated with active management of an actual portfolio.                                                                           |

For information regarding the indexes and certain key investment terms, see Key Investment Terms starting on page 18. 5

#### Convertible & Income
Fund II (NCZ)

### MANAGER’S DISCUSSION OF FUND PERFORMANCE
(Unaudited)

#### January 31, 2025
About
the Fund:

Convertible & Income Fund
II’s (NYSE: NCZ) (the “Fund”) investment objective is to provide total return through a combination of capital appreciation and high current income. There is no guarantee that the Fund will achieve its investment objective.

The
use of leverage currently enables the Fund to have a blended capital structure combining long-term fixed rates and short-term variable rates which allows the Fund to seek to enhance the yields on its investments. As of January 31, 2025, the
Fund’s leverage consisted of $156.0 million of borrowings made pursuant to a combination of cumulative preferred shares, mandatory redeemable preferred shares, margin financing and/or securities lending, which represented approximately 36% of
the Fund’s total assets.

Manager Comments - Voya
Investment Management Co. LLC (“Voya IM”)

Voya IM manages the Fund. As the asset
management business of Voya Financial (NYSE: VOYA), Voya IM seeks to understand and anticipate client needs, delivering differentiated solutions across public and private fixed income, equity, and multi-asset platforms, including private markets and
alternatives. The following commentary is provided by the portfolio team at Voya IM.

How did the markets perform during the Fund’s fiscal year