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Is Schwab Fundamental International Large Company Index ETF (FNDF) a Strong ETF Right Now?
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The Schwab Fundamental International Large Company Index ETF (FNDF - Free Report) was launched on 08/13/2013, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track 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.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Charles Schwab. FNDF has been able to amass assets over $9.06 billion, making it one of the largest ETFs in the Broad Developed World ETFs. FNDF 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 FNDF are 0.25%, which makes it one of the cheaper products in the space.
It's 12-month trailing dividend yield comes in at 3.05%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Shell Plc (SHEL - Free Report) accounts for about 2.67% of the fund's total assets, followed by Samsung Electronics Ltd and Totalenergies (TTE - Free Report) .
Its top 10 holdings account for approximately 12.99% of FNDF's total assets under management.
Performance and Risk
The ETF has added roughly 1.65% and is down about -1.48% so far this year and in the past one year (as of 03/16/2023), respectively. FNDF has traded between $25.15 and $32.80 during this last 52-week period.
The fund has a beta of 0.86 and standard deviation of 22.14% for the trailing three-year period, which makes FNDF a medium risk choice in this particular space. With about 962 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 $51.33 billion in assets, Vanguard FTSE Developed Markets ETF has $102.45 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?
The Schwab Fundamental International Large Company Index ETF (FNDF - Free Report) was launched on 08/13/2013, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Developed World ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track 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.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Charles Schwab. FNDF has been able to amass assets over $9.06 billion, making it one of the largest ETFs in the Broad Developed World ETFs. FNDF 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 FNDF are 0.25%, which makes it one of the cheaper products in the space.
It's 12-month trailing dividend yield comes in at 3.05%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Shell Plc (SHEL - Free Report) accounts for about 2.67% of the fund's total assets, followed by Samsung Electronics Ltd and Totalenergies (TTE - Free Report) .
Its top 10 holdings account for approximately 12.99% of FNDF's total assets under management.
Performance and Risk
The ETF has added roughly 1.65% and is down about -1.48% so far this year and in the past one year (as of 03/16/2023), respectively. FNDF has traded between $25.15 and $32.80 during this last 52-week period.
The fund has a beta of 0.86 and standard deviation of 22.14% for the trailing three-year period, which makes FNDF a medium risk choice in this particular space. With about 962 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 $51.33 billion in assets, Vanguard FTSE Developed Markets ETF has $102.45 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.