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Should Schwab 1000 Index ETF (SCHK) Be on Your Investing Radar?
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Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the Schwab 1000 Index ETF (SCHK - Free Report) , a passively managed exchange traded fund launched on 10/11/2017.
The fund is sponsored by Charles Schwab. It has amassed assets over $2.09 billion, making it one of the larger ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.05%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.20%.
Performance and Risk
SCHK seeks to match the performance of the Schwab 1000 Index before fees and expenses. The Schwab 1000 Index is a float-adjusted market capitalization weighted index that includes the 1,000 largest stocks of publicly traded companies in the United States, with size being determined by market capitalization. The index is designed to be a measure of the performance of large- and mid-cap U.S. stocks.
The ETF has gained about 19.02% so far this year and it's up approximately 30.73% in the last one year (as of 10/08/2021). In the past 52-week period, it has traded between $32.23 and $45.01.
The ETF has a beta of 1.02 and standard deviation of 22.84% for the trailing three-year period. With about 998 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab 1000 Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, SCHK is a sufficient option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $293.16 billion in assets, SPDR S&P 500 ETF has $391.66 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should Schwab 1000 Index ETF (SCHK) Be on Your Investing Radar?
Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the Schwab 1000 Index ETF (SCHK - Free Report) , a passively managed exchange traded fund launched on 10/11/2017.
The fund is sponsored by Charles Schwab. It has amassed assets over $2.09 billion, making it one of the larger ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.05%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.20%.
Performance and Risk
SCHK seeks to match the performance of the Schwab 1000 Index before fees and expenses. The Schwab 1000 Index is a float-adjusted market capitalization weighted index that includes the 1,000 largest stocks of publicly traded companies in the United States, with size being determined by market capitalization. The index is designed to be a measure of the performance of large- and mid-cap U.S. stocks.
The ETF has gained about 19.02% so far this year and it's up approximately 30.73% in the last one year (as of 10/08/2021). In the past 52-week period, it has traded between $32.23 and $45.01.
The ETF has a beta of 1.02 and standard deviation of 22.84% for the trailing three-year period. With about 998 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab 1000 Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, SCHK is a sufficient option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $293.16 billion in assets, SPDR S&P 500 ETF has $391.66 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.