We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is Schwab Fundamental International Small Company Index ETF (FNDC) a Strong ETF Right Now?
Read MoreHide Full Article
A smart beta exchange traded fund, the Schwab Fundamental International Small Company Index ETF (FNDC - Free Report) debuted on 08/13/2013, and offers broad exposure to the Foreign Small/Mid Value ETF 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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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
Managed by Charles Schwab, FNDC has amassed assets over $3.06 billion, making it one of the larger ETFs in the Foreign Small/Mid Value ETF. This particular fund seeks to match the performance of the Russell RAFI Developed ex-U.S. Small Co. Index (Net) before fees and expenses.
The RAFI Fundamental High Liquidity Developed ex US Small Index measures the performance of small non-U.S. developed market companies based on their fundamental size and weight.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.39%.
The fund has a 12-month trailing dividend yield of 3.45%.
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.
When you look at individual holdings, Daewoo Engineering & Constructionaccounts for about 0.33% of the fund's total assets, followed by Tower Semiconductor Ltd (TSEM) and Ibiden Ltd.
FNDC's top 10 holdings account for about 2.51% of its total assets under management.
Performance and Risk
The ETF has added roughly 11.72% and is up about 26.17% so far this year and in the past one year (as of 06/19/2026), respectively. FNDC has traded between $40.58 and $50.67 during this last 52-week period.
FNDC has a beta of 0.75 and standard deviation of 14.55% for the trailing three-year period, which makes the fund a low risk choice in the space. With about 1607 holdings, it effectively diversifies company-specific risk .
Alternatives
Schwab Fundamental International Small Company Index ETF is a reasonable option for investors seeking to outperform the Foreign Small/Mid Value ETF segment of the market. However, there are other ETFs in the space which investors could consider.
Invesco RAFI Developed Markets ex-U.S. Small-Mid ETF (PDN) tracks FTSE RAFI Developed Markets ex-U.S. Mid-Small 1500 Index and the WisdomTree Dynamic International SmallCap Equity Fund (DDLS) tracks WisdomTree Dynamic Currency Hedged International SmallCap Equity Index. Invesco RAFI Developed Markets ex-U.S. Small-Mid ETF has $357.12 million in assets, WisdomTree Dynamic International SmallCap Equity Fund has $440.38 million. PDN has an expense ratio of 0.47% and DDLS changes 0.48%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Foreign Small/Mid Value ETF
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.
View the Zacks #1 Rank List
Image: Bigstock
Is Schwab Fundamental International Small Company Index ETF (FNDC) a Strong ETF Right Now?
A smart beta exchange traded fund, the Schwab Fundamental International Small Company Index ETF (FNDC - Free Report) debuted on 08/13/2013, and offers broad exposure to the Foreign Small/Mid Value ETF 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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
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
Managed by Charles Schwab, FNDC has amassed assets over $3.06 billion, making it one of the larger ETFs in the Foreign Small/Mid Value ETF. This particular fund seeks to match the performance of the Russell RAFI Developed ex-U.S. Small Co. Index (Net) before fees and expenses.
The RAFI Fundamental High Liquidity Developed ex US Small Index measures the performance of small non-U.S. developed market companies based on their fundamental size and weight.
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.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.39%.
The fund has a 12-month trailing dividend yield of 3.45%.
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.
When you look at individual holdings, Daewoo Engineering & Constructionaccounts for about 0.33% of the fund's total assets, followed by Tower Semiconductor Ltd (TSEM) and Ibiden Ltd.
FNDC's top 10 holdings account for about 2.51% of its total assets under management.
Performance and Risk
The ETF has added roughly 11.72% and is up about 26.17% so far this year and in the past one year (as of 06/19/2026), respectively. FNDC has traded between $40.58 and $50.67 during this last 52-week period.
FNDC has a beta of 0.75 and standard deviation of 14.55% for the trailing three-year period, which makes the fund a low risk choice in the space. With about 1607 holdings, it effectively diversifies company-specific risk .
Alternatives
Schwab Fundamental International Small Company Index ETF is a reasonable option for investors seeking to outperform the Foreign Small/Mid Value ETF segment of the market. However, there are other ETFs in the space which investors could consider.
Invesco RAFI Developed Markets ex-U.S. Small-Mid ETF (PDN) tracks FTSE RAFI Developed Markets ex-U.S. Mid-Small 1500 Index and the WisdomTree Dynamic International SmallCap Equity Fund (DDLS) tracks WisdomTree Dynamic Currency Hedged International SmallCap Equity Index. Invesco RAFI Developed Markets ex-U.S. Small-Mid ETF has $357.12 million in assets, WisdomTree Dynamic International SmallCap Equity Fund has $440.38 million. PDN has an expense ratio of 0.47% and DDLS changes 0.48%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Foreign Small/Mid Value ETF
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.