Schwab Asset Management, the asset management arm of The Charles Schwab Corporation, announced launching the Schwab Core Bond ETF (Trading under SCCR on the NYSE Arca). This is the business’s second actively managed fixed-income ETF after the launch in August 2024 of the Schwab Ultra-Short Income ETF (Trading under SCUS on the NYSE Arca). The first day of SCCR trading 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%. And the goal of the fund is to provide total return while generating income through investing in U.S. dollar-denominated debt securities like corporate bonds, taxable municipal bonds, mortgage pass-through securities, commercial mortgage-backed securities, asset-backed securities, U.S. Treasuries, and other government-related bonds.
Created based on the investment process used for the Wasmer Schroeder Core Bond Separately Managed Account (SMA) strategy that was launched in January 2008, 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. And they will target attractive risk-adjusted returns using qualitative and quantitative methods to manage a diversified portfolio of bonds across multiple sectors backed by Schwab Asset Management’s experienced credit research team.
As 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. And 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.
KEY QUOTE:
“The Schwab Core Bond ETF provides investors with access to our portfolio management team’s expertise, along with the inherent features of an ETF. 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.”
– David Lafferty, Director, Product Management & Innovation, Schwab Asset Management
