Schwab Asset Management adds first actively
managed fixed income ETF to its lineup
Schwab Asset Management®, the asset management arm of The
Charles Schwab Corporation, today announced the launch of the
Schwab Ultra-Short Income ETF (NYSE Arca: SCUS), its first actively
managed fixed income ETF. The first day of trading is expected to
be on or about August 13.
With an expense ratio of 0.14%, the Schwab Ultra-Short Income
ETF is priced below the industry average of 0.25%1. The ETF will
provide access to the U.S. dollar denominated investment grade,
short-term bond market and is designed to serve as part of a
diversified portfolio.
“The Schwab Ultra-Short Income ETF is a notable addition to the
Schwab family of ETFs as investors continue to seek out
cost-effective, income-producing strategies to help diversify their
portfolios,” said David Lafferty, Director, Product Strategy &
Development, Schwab Asset Management. “With SCUS, the first
actively managed offering in our fixed income ETF lineup, we
believe investors will benefit from our extensive credit research
and portfolio management teams, along with the inherent features of
an ETF.”
The goal of the Schwab Ultra-Short Income ETF is to seek current
income consistent with capital preservation while maintaining
liquidity. The ETF invests in investment grade, short-term, U.S.
dollar denominated debt securities issued by U.S. and foreign
issuers and will maintain a portfolio duration of one year or
less.
The fifth-largest provider of ETFs2, Schwab Asset Management has
more than a decade of experience managing ETFs with a robust
capital markets team. The Schwab Ultra-Short Income ETF is Schwab
Asset Management’s tenth bond ETF and the 31st Schwab ETF overall.
Schwab bond ETFs seek to be among the lowest cost across the
industry’s leading ETF providers.
About Schwab Asset Management
One of the industry’s largest and most experienced asset
managers, Schwab Asset Management offers a focused lineup of
competitively priced ETFs, mutual funds and separately managed
account strategies designed to serve the central needs of most
investors. By operating through clients’ eyes, and putting them at
the center of our decisions, we aim to deliver exceptional
experiences to investors and the financial professionals who serve
them. As of March 31, 2024, Schwab Asset Management managed
approximately $1.2 trillion on a discretionary basis and $45.7
billion on a non-discretionary basis.
More information is available at www.aboutschwab.com. Follow us
on Twitter/X, Facebook, and LinkedIn.
About Charles Schwab
At Charles Schwab we believe in the power of investing to help
individuals create a better tomorrow. We have a history of
challenging the status quo in our industry, innovating in ways that
benefit investors and the advisors and employers who serve them,
and championing our clients’ goals with passion and integrity.
More information is available at www.aboutschwab.com. Follow us
on Twitter, Facebook, YouTube and LinkedIn.
Disclosures:
Investors should consider carefully information contained in
the prospectus, or if available, the summary prospectus, including
investment objectives, risks, charges and expenses. You can obtain
a prospectus, or if available, a summary prospectus by visiting
https://www.schwabassetmanagement.com/prospectus. Please read it
carefully before investing.
Investment returns will fluctuate and are subject to market
volatility, so that an investor’s shares, when redeemed or sold,
may be worth more or less than their original cost. Unlike mutual
funds, shares of ETFs are not individually redeemable directly with
the ETF. Shares of ETF are bought and sold at market price, which
may be higher or lower than the net asset value (NAV).
Diversification and asset allocation strategies do not ensure a
profit and do not protect against losses in declining markets.
Schwab Ultra-Short Income ETF is an actively managed exchange
traded fund and therefore does not seek to replicate the
performance of any specific index. The fund may have a higher
degree of portfolio turnover than funds that seek to replicate the
performance of an index.
Schwab Ultra-Short Income ETF is not a money market fund and
does not seek to maintain a stable net asset value of $1.00 per
share. The fund is not subject to the strict rules that govern
the diversity, quality, maturity, liquidity and other features of
securities that money market funds may purchase designed to enable
money market funds to maintain a stable share price and to limit
investment risk. Under normal circumstances, the fund’s investments
may be more susceptible than a money market fund is to credit risk,
interest rate risk, valuation risk and other risks relevant to the
fund’s investments. The fund does not seek to maintain a stable net
asset value of $1.00 per share. Therefore, the fund’s net asset
value per share and market value will fluctuate, and these
fluctuations may be significant on certain days. There can be no
guarantee that the fund will generate higher returns than money
market funds. In addition, the fund does not qualify for certain
tax relief afforded to money market funds by the U.S. Treasury.
Fixed income securities are subject to increased loss of
principal during periods of rising interest rates. Fixed-income
investments are subject to various other risks including changes in
credit quality, market valuations, liquidity, prepayments, early
redemption, corporate events, tax ramifications and other
factors.
An actively managed fund is subject to the risk that its
investment adviser and/or subadviser will select investments or
allocate assets in a manner that could cause the fund to
underperform or otherwise not meet its investment objective.
The fund may invest in U.S.-registered, dollar-denominated bonds
of non-U.S. corporations. The fund’s investments in bonds of
non-U.S. issuers may involve certain risks that are greater than
those associated with investments in securities of U.S. issuers.
These include risks of adverse changes in foreign economic,
political, regulatory and other conditions; the imposition of
economic sanctions or other government restrictions; differing
accounting, auditing, financial reporting and legal standards and
practices; differing securities market structures; and higher
transaction costs. These risks may be heightened in connection with
bonds issued by non-U.S. corporations and entities in emerging
markets.
Schwab Asset Management® is the dba name for Charles Schwab
Investment Management, Inc., the investment adviser for Schwab
Funds, Schwab ETFs, and separately managed account strategies.
Schwab Funds are distributed by Charles Schwab & Co, Inc.
(Schwab), Member SIPC. Schwab ETFs are distributed by SEI
Investments Distribution Co. (SIDCO). Schwab Asset Management and
Schwab are separate but affiliated companies and subsidiaries of
The Charles Schwab Corporation, and are not affiliated with
SIDCO.
0724-CP83
1 Source: Morningstar data as of June 30, 2024. Data universe is
the actively managed ETFs in the Ultrashort Bond category. 2
Source: VettaFi, ETF Issuer League of Table, July 1, 2024.
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version on businesswire.com: https://www.businesswire.com/news/home/20240730882090/en/
Christine Underhill Charles Schwab 415-961-3790
Charles Schwab (NYSE:SCHW)
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