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Is Schwab Fundamental International Large Company Index ETF (FNDF) a Strong ETF Right Now?
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Launched on 08/13/2013, the Schwab Fundamental International Large Company Index ETF (FNDF - Free Report) is a smart beta exchange traded fund offering broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
FNDF is managed by Charles Schwab, and this fund has amassed over $7.13 billion, which makes it one of the largest ETFs in the Broad Developed World ETFs. This particular fund seeks to match the performance of the Russell RAFI Developed ex US Large Co. Index (Net) before fees and expenses.
The Russell RAFI Developed ex US Large Company Index (Net) measures the performance of the large company size segment by fundamental overall company scores, which are created using as the universe the companies included in the Russell Developed ex-U.S. Index.
Cost & Other Expenses
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 0.25%, making it one of the cheaper products in the space.
FNDF's 12-month trailing dividend yield is 4.11%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Shell Plc (SHEL - Free Report) accounts for about 3.97% of total assets, followed by Bp Plc (BP.) and Samsung Electronics Ltd.
FNDF's top 10 holdings account for about 12.65% of its total assets under management.
Performance and Risk
Year-to-date, the Schwab Fundamental International Large Company Index ETF has lost about -12.48% so far, and is down about -11.62% over the last 12 months (as of 07/04/2022). FNDF has traded between $28.10 and $34.12 in this past 52-week period.
The fund has a beta of 0.85 and standard deviation of 23.03% for the trailing three-year period, which makes FNDF a medium risk choice in this particular space. With about 946 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab Fundamental International Large Company Index ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Total International Stock ETF (VXUS - Free Report) tracks FTSE Global All Cap ex US Index and the Vanguard FTSE Developed Markets ETF (VEA - Free Report) tracks FTSE Developed All Cap ex US Index. Vanguard Total International Stock ETF has $45.43 billion in assets, Vanguard FTSE Developed Markets ETF has $91.59 billion. VXUS has an expense ratio of 0.07% and VEA charges 0.05%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World ETFs.
Bottom Line
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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Is Schwab Fundamental International Large Company Index ETF (FNDF) a Strong ETF Right Now?
Launched on 08/13/2013, the Schwab Fundamental International Large Company Index ETF (FNDF - Free Report) is a smart beta exchange traded fund offering broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
FNDF is managed by Charles Schwab, and this fund has amassed over $7.13 billion, which makes it one of the largest ETFs in the Broad Developed World ETFs. This particular fund seeks to match the performance of the Russell RAFI Developed ex US Large Co. Index (Net) before fees and expenses.
The Russell RAFI Developed ex US Large Company Index (Net) measures the performance of the large company size segment by fundamental overall company scores, which are created using as the universe the companies included in the Russell Developed ex-U.S. Index.
Cost & Other Expenses
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 0.25%, making it one of the cheaper products in the space.
FNDF's 12-month trailing dividend yield is 4.11%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Shell Plc (SHEL - Free Report) accounts for about 3.97% of total assets, followed by Bp Plc (BP.) and Samsung Electronics Ltd.
FNDF's top 10 holdings account for about 12.65% of its total assets under management.
Performance and Risk
Year-to-date, the Schwab Fundamental International Large Company Index ETF has lost about -12.48% so far, and is down about -11.62% over the last 12 months (as of 07/04/2022). FNDF has traded between $28.10 and $34.12 in this past 52-week period.
The fund has a beta of 0.85 and standard deviation of 23.03% for the trailing three-year period, which makes FNDF a medium risk choice in this particular space. With about 946 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab Fundamental International Large Company Index ETF is a reasonable option for investors seeking to outperform the Broad Developed World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Total International Stock ETF (VXUS - Free Report) tracks FTSE Global All Cap ex US Index and the Vanguard FTSE Developed Markets ETF (VEA - Free Report) tracks FTSE Developed All Cap ex US Index. Vanguard Total International Stock ETF has $45.43 billion in assets, Vanguard FTSE Developed Markets ETF has $91.59 billion. VXUS has an expense ratio of 0.07% and VEA charges 0.05%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed World ETFs.
Bottom Line
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.