Schwab Asset Management to Launch the Schwab Core Bond ETF

By: The Charles Schwab Corporation via Business Wire

January 13, 2025 at 08:00 AM EST

Schwab Asset Management expands its actively managed ETF line-up

Schwab Asset Management^®, the asset management arm of The Charles Schwab Corporation, today announced the launch of the Schwab Core Bond ETF (NYSE Arca: SCCR). It’s the business’s second actively managed fixed income ETF after the launch in August 2024 of the Schwab Ultra-Short Income ETF (NYSE Arca: SCUS). The first day of trading of SCCR is expected to be on or about February 5.

With an expense ratio of 0.16%, the Schwab Core Bond ETF is priced below the industry average of 0.40%.¹ The goal of the fund is to provide total return while generating income through investing in U.S. dollar-denominated debt securities such as corporate bonds, taxable municipal bonds, mortgage pass-through securities, commercial mortgage-backed securities, asset-backed securities, U.S. Treasuries, and other government-related bonds.

Designed based on the investment process used for the Wasmer Schroeder Core Bond Separately Managed Account (SMA) strategy that was launched in January 2008², the new fund will be managed by portfolio managers who have supported the Wasmer Schroeder™ strategies: John Majoros, senior portfolio manager and co-head of SMA strategies, and Brian Luedtke senior portfolio manager. They will target attractive risk-adjusted returns using qualitative and quantitative methods to manage a diversified portfolio of bonds across multiple sectors and backed by Schwab Asset Management’s experienced credit research team.

“The Schwab Core Bond ETF provides investors with access to our portfolio management team’s expertise, along with the inherent features of an ETF,” said David Lafferty, Director, Product Management & Innovation, Schwab Asset Management. “In today’s rate environment, investors have the potential to capture a healthy level of income and navigate total market volatility by diversifying their core bond exposure with high-quality bonds.”

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 September 30, 2024, Schwab Asset Management managed approximately $1.3 trillion on a discretionary basis and $40.7 billion on a non-discretionary basis.

More information is available at www.schwabassetmanagement.com.

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 aboutschwab.com. Follow us on X, 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 Core Bond 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.

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.

Portfolio Management for the Wasmer Schroeder Strategies is provided by Charles Schwab Investment Management, Inc., dba Schwab Asset Management^®, a registered investment adviser and an affiliate of Charles Schwab & Co., Inc. (“Schwab”). Both Schwab Asset Management and Schwab are separate entities and subsidiaries of The Charles Schwab Corporation. Please refer to the Charles Schwab Investment Management, Inc. Disclosure Brochure for additional information.

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.

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¹ Morningstar categories are not assigned until after inception date. Comparison based on Schwab Asset Management’s analysis of categories with ETFs that have similar characteristics to SCCR, as of 11/30/2024.

² Schwab Asset Management became the investment adviser for Wasmer Schroeder Strategies in 2020.