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Schwab Index Funds

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There are thousands of companies listed on major stock exchanges such as NASDAQ and the NYSE. As an investor, picking the right stocks individually to invest in can be a challenge. If you’re new to investing, consider putting your money with index funds to build a better portfolio and earn bigger profits.

Best Schwab Index Funds:

Symbol Company % Change Price Invest
SCHX Schwab U.S. Large-Cap ETF
+ 0%
$88.84 Buy stock
SCHF Schwab International Equity ETF
+ 0.3%
$35.55 Buy stock
SCHB Schwab U.S. Broad Market ETF
+ 0.12%
$88.63 Buy stock
SCHD Schwab US Dividend Equity ETF
+ 0.16%
$64.01 Buy stock
SCHP Schwab U.S. TIPs ETF
+ 0.27%
$61.56 Buy stock

What are Index Funds?

Index funds are actively managed funds that mirror the performance of market indices. A market index is a collective measure of a set of similar companies and their impact on the economy. Among the several market indices, Schwab 1000 Index, S&P 500 index and Dow Jones U.S. Select REIT Index are known throughout the world.  

You cannot directly invest in market indices. However, you can invest in many leading companies with a single trade by buying or selling shares of index funds. Index funds hold assets in multiple companies that reflect the performance of market indices. These holdings can vary as per the guidelines of the index fund managers and are periodically regulated to maintain a positive return rate. 

Charles Schwab has been an industry leader in indexing for over 25 years. It gives investors access to index funds and exchange-traded funds (ETFs) from different industry verticals and covers companies from various asset-classes. Schwab provides index funds with some of the lowest costs and highest year-to-date earnings.  

For investors with limited time on their hands, researching individual companies and their financial history can be time-consuming. Index funds and ETFs from Schwab let you own shares of multiple companies without having to worry over their daily performance.

Schwab 1000 Index vs. Actively Managed Funds

Best Schwab Index Funds Right Now

Schwab is the 3rd-largest provider of index mutual funds. The combined assets under management (AUM) of Schwab index funds and Schwab ETFs is $255.8 billion. 

You can consider investing in these Schwab index funds and ETFs: 

1. Schwab US Large-Cap ETF (NYSEARCA: SCHX)

Schwab US Large-Cap ETF has been on the market since 2009. It tracks the Dow Jones U.S. Large-Cap Total Stock Market Index and has holdings in 763 companies. This index fund focuses on companies from industrial sectors such as information technology, health care, consumer discretionary and financial services. Schwab US Large-Cap ETF consists of large-cap companies in North America that include Apple, Microsoft, Amazon.com, Facebook and Alphabet.

Cumulative Growth of $10,000 Investment in SCHX

This ETF has an expense ratio of 0.03% and a P/E ratio of 23.3. It has a 52-week low of $51.23 and a 52-week high of $88. Schwab US Large-Cap ETF has high liquidity and trades more than 407,134 shares per day. It has AUM of $23,808 million and has an annual dividend yield of $1.59 per share. SCHX has a 1-year return rate of 19.74%, a 3-year return rate of 51.26% and a 5-year return rate of 99.69%. 

Historical performance of Schwab U.S. Large-Cap ETF over the last 5 years

2. Schwab International Equity ETF (NYSEARCA: SCHF)

Schwab International Equity ETF has been open to trade since 2009. It tracks the FTSE Developed ex US Index and has holdings in 1,524 companies. The index fund focuses on multinational companies from industrial sectors such as health care, consumer staples, information technology and communication services. Schwab International Equity ETF includes companies such as Nestle, Roche, Novartis and Samsung.  

Cumulative Growth of $10,000 Investment in SCHF

This ETF has an expense ratio of 0.06% and a P/E ratio of 16.14. It has a 52-week low of $21.73 and a 52-week high of $34.51. Schwab International Equity ETF has high liquidity and trades more than 1,847,566 shares per day. It has AUM of $21,703 million and an annual dividend yield of $0.97 per share. SCHF has a 1-year return rate of 6.42%, a 3-year return rate of 12.24% and a 5-year return rate of 40.46%. 

Historical performance of Schwab International Equity ETF in the last 5 years

3. Schwab US Broad Market ETF (NYSEARCA: SCHB)

Schwab US Broad Market ETF was launched in 2009. It tracks the Dow Jones U.S. Broad Stock Market Total Return Index and has holdings in 2,493 companies. The index fund focuses on companies from industrial sectors such as information technology, health care and financial services. Schwab US Broad Market ETF consists of North American companies such as Apple, Johnson & Johnson, Visa and JPMorgan Chase. 

Cumulative Growth of $10,000 Investment in SCHB

This ETF has an expense ratio of 0.03% and a P/E ratio of 22.74. It has a 52-week low of $50.56 and a 52-week high of $87.21. Schwab US Broad Market ETF has high liquidity and trades more than 360,125 shares per day. It has AUM of $16,567 million and has an annual dividend yield of $1.58 per share. SCHB has a 1-year return rate of 19.05%, a 3-year return rate of 48.77% and a 5-year return rate of 96.02%. 

Historical performance of Schwab U.S. Broad Market ETF in the last 5 years.

4. Schwab US Dividend Equity ETF (NYSEARCA: SCHD)

Schwab US Dividend Equity ETF has been on the market since 2011. It tracks the Dow Jones U.S. Dividend 100™ Index and has holdings in 104 companies. The index fund focuses on companies from industrial sectors such as financial services, consumer staples and communication services. Schwab US Dividend Equity ETF consists of North American companies such as Blackrock, Qualcomm, 3M and Verizon. 

Cumulative Growth of $10,000 Investment in SCHD

This ETF has an expense ratio of 0.06% and has a P/E ratio of 14.97. It has a 52-week low of $37.73 and a 52-week high of $62.9. Schwab US Dividend Equity ETF has high liquidity and trades over 1.1 million shares per day. It has AUM of $14,199 million and has an annual dividend yield of $1.89 per share. SCHD has a 1-year return rate of 14.43%, a 3-year return rate of 42.49% and a 5-year return rate of 93.36%.

Historical performance of Schwab U.S. Dividend Equity ETF in the last 5 years.

5. Schwab US TIPS ETF (NYSEARCA: SCHP)

Traders have been investing in Schwab US Tips ETF since 2010. It tracks the Bloomberg Barclays U.S. Treasury Inflation-Linked Bond Index and has holdings in 45 U.S. government securities. 

Cumulative Growth of $10,000 Investment in SCHP

This ETF has an expense ratio of 0.05%. It has a 52-week low of $52.19 and a 52-week high of $61.62. Schwab U.S. Tips ETF has high liquidity and trades more than 695,268 shares per day. It has AUM of $13,075 million and has an annual dividend yield of $0.79 per share. SCHP has a 1-year return rate of 9.43%, a 3-year return rate of 16.72% and a 5-year return rate of 25.03%. 

Historical performance of Schwab U.S. Tips ETF in the last 5 years

Best Online Brokers for Index Funds

Take a look at some of the top online brokers on the market. 

Commissions
$0
Account Minimum
$0
Get started securely through Webull’s website
Commissions
$0
Account Minimum
$0
1 Minute Review

Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.

Webull is widely considered one of the best Robinhood alternatives.

Best For
  • Active traders
  • Intermediate traders
  • Advanced traders
Pros
  • Commission-free trading in over 5,000 different stocks and ETFs
  • No account maintenance fees or software platform fees
  • No charges to open and maintain an account
  • Leverage of 4:1 on margin trades made the same day and leverage of 2:1 on trades held overnight
  • Intuitive trading platform with technical and fundamental analysis tools
Cons
  • Does not support trading in mutual funds, bonds or OTC stocks
Commissions
$0
Account Minimum
$0
Get started securely through TradeStation’s website
Commissions
$0
Account Minimum
$0
1 Minute Review

TradeStation is for advanced traders who need a comprehensive platform. The brokerage offers an impressive range of investable assets as frequent and professional traders appreciate its wide range of analysis tools. TradeStation’s app is also equally effective, offering full platform capabilities.

Best For
  • Advanced traders
  • Options and futures traders
  • Active stock traders
Pros
  • Comprehensive trading platform and professional-grade tools
  • Wide range of tradable securities
  • Fully-operational mobile app
Cons
  • Confusing pricing structure to leave new traders with a weak understanding of what they pay
  • Cluttered layout to make navigating TradeStation’s platform more difficult than it should be
Commissions
$0 $6.95 for OTC Stocks
Account Minimum
$0
Get started securely through TD Ameritrade’s website
Commissions
$0 $6.95 for OTC Stocks
Account Minimum
$0
1 Minute Review

This publicly listed discount broker, which is in existence for over four decades, is service-intensive, offering intuitive and powerful investment tools. Especially, with equity investing, a flat fee is charged, with the firm claiming that it charges no trade minimum, no data fees, and no platform fees. Though it is pricier than many other discount brokers, what tilts the scales in its favor is its well-rounded service offerings and the quality and value it offers its clients.

Best For
  • Novice investors
  • Retirement savers
  • Day traders
Pros
  • World-class trading platforms
  • Detailed research reports and Education Center
  • Assets ranging from stocks and ETFs to derivatives like futures and options
Cons
  • Thinkorswim can be overwhelming to inexperienced traders
  • Derivatives trading more costly than some competitors
  • Expensive margin rates

Advantages of Index Funds

Here’s a rundown of the pros of investing in index funds. 

  • Index funds are passively managed. Fund managers are regularly tracking the performance of the index funds. 
  • You can choose from hundreds of low-cost index funds and ETFs to invest in. Most index funds have expense ratios of less than 1% and trade free of commission. 
  • You can instantly diversify your portfolio by investing in index funds. ETFs and index funds constitute a broad range of multi-cap companies from different industrial verticals.
  • Index funds do not actively execute buy and sell positions throughout the day and reduce capital gains. As a result, investing in index funds can be tax-efficient compared to other investments.
  • Most index funds are highly liquid. Millions of index fund and ETF shares are traded every day. 

Disadvantages of Index Funds

Here’s a rundown of the cons of investing in index funds. 

  • Market indices can move their positions rapidly during the day. Due to the frequent fluctuations in stock prices, the index funds may not track the market indices precisely in real-time.
  • Index funds with high expense ratios can take a significant cut from your profits. Investors planning to buy-and-hold shares of index funds must consider recurring costs in the long run. 

Schwab Index Funds can Strengthen your Portfolio

Schwab index funds enable you to own shares in hundreds of growing companies with ease and efficiency. Passively managed index funds from Schwab can also lower the risk of incurring losses from short-term market volatility. The low-cost of investing in index funds has attracted new investors to earn better returns and secure a better financial future. 

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