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Should Schwab U.S. LargeCap ETF (SCHX) Be on Your Investing Radar?
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Designed to provide broad exposure to the Large Cap Blend segment of the US equity market, the Schwab U.S. LargeCap ETF (SCHX - Free Report) is a passively managed exchange traded fund launched on 11/03/2009.
The fund is sponsored by Charles Schwab. It has amassed assets over $33.48 billion, making it one of the largest 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. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.03%, 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
SCHX seeks to match the performance of the Dow Jones U.S. Large-Cap Total Stock Market Index before fees and expenses. The Dow Jones U.S. Large-Cap Total Stock Market measures all U.S. equity securities with readily available prices. The index includes approximately the largest 750 stocks and is float-adjusted market-capitalization weighted.
The ETF has added about 23.35% so far this year and was up about 34.10% in the last one year (as of 10/21/2021). In the past 52-week period, it has traded between $78.71 and $109.87.
The ETF has a beta of 1.01 and standard deviation of 23.04% for the trailing three-year period, making it a medium risk choice in the space. With about 771 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab U.S. LargeCap ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SCHX is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
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 $302.54 billion in assets, SPDR S&P 500 ETF has $407.35 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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 U.S. LargeCap ETF (SCHX) Be on Your Investing Radar?
Designed to provide broad exposure to the Large Cap Blend segment of the US equity market, the Schwab U.S. LargeCap ETF (SCHX - Free Report) is a passively managed exchange traded fund launched on 11/03/2009.
The fund is sponsored by Charles Schwab. It has amassed assets over $33.48 billion, making it one of the largest 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. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.03%, 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
SCHX seeks to match the performance of the Dow Jones U.S. Large-Cap Total Stock Market Index before fees and expenses. The Dow Jones U.S. Large-Cap Total Stock Market measures all U.S. equity securities with readily available prices. The index includes approximately the largest 750 stocks and is float-adjusted market-capitalization weighted.
The ETF has added about 23.35% so far this year and was up about 34.10% in the last one year (as of 10/21/2021). In the past 52-week period, it has traded between $78.71 and $109.87.
The ETF has a beta of 1.01 and standard deviation of 23.04% for the trailing three-year period, making it a medium risk choice in the space. With about 771 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab U.S. LargeCap ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SCHX is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
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 $302.54 billion in assets, SPDR S&P 500 ETF has $407.35 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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.