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Should Schwab U.S. Large-Cap Growth ETF (SCHG) Be on Your Investing Radar?
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The Schwab U.S. Large-Cap Growth ETF (SCHG - Free Report) was launched on 12/11/2009, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Charles Schwab. It has amassed assets over $28.09 billion, making it one of the largest ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies usually have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.04%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.42%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 47.90% of the portfolio. Telecom and Consumer Discretionary round out the top three.
Looking at individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 12.44% of total assets, followed by Apple Inc (AAPL - Free Report) and Nvidia Corp (NVDA - Free Report) .
The top 10 holdings account for about 55.25% of total assets under management.
Performance and Risk
SCHG seeks to match the performance of the Dow Jones U.S. Large-Cap Growth Total Stock Market Index before fees and expenses. The Dow Jones U.S. Large-Cap Growth Total Stock Market Index is float-adjusted market-capitalization weighted and includes the large-cap growth portion of the Dow Jones U.S. Total Stock Market Index.
The ETF has added roughly 13.99% so far this year and it's up approximately 34.39% in the last one year (as of 05/31/2024). In the past 52-week period, it has traded between $70.08 and $96.49.
The ETF has a beta of 1.09 and standard deviation of 22.94% for the trailing three-year period, making it a medium risk choice in the space. With about 251 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab U.S. Large-Cap Growth ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SCHG is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $123.69 billion in assets, Invesco QQQ has $267 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
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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Should Schwab U.S. Large-Cap Growth ETF (SCHG) Be on Your Investing Radar?
The Schwab U.S. Large-Cap Growth ETF (SCHG - Free Report) was launched on 12/11/2009, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Charles Schwab. It has amassed assets over $28.09 billion, making it one of the largest ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies usually have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.04%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.42%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 47.90% of the portfolio. Telecom and Consumer Discretionary round out the top three.
Looking at individual holdings, Microsoft Corp (MSFT - Free Report) accounts for about 12.44% of total assets, followed by Apple Inc (AAPL - Free Report) and Nvidia Corp (NVDA - Free Report) .
The top 10 holdings account for about 55.25% of total assets under management.
Performance and Risk
SCHG seeks to match the performance of the Dow Jones U.S. Large-Cap Growth Total Stock Market Index before fees and expenses. The Dow Jones U.S. Large-Cap Growth Total Stock Market Index is float-adjusted market-capitalization weighted and includes the large-cap growth portion of the Dow Jones U.S. Total Stock Market Index.
The ETF has added roughly 13.99% so far this year and it's up approximately 34.39% in the last one year (as of 05/31/2024). In the past 52-week period, it has traded between $70.08 and $96.49.
The ETF has a beta of 1.09 and standard deviation of 22.94% for the trailing three-year period, making it a medium risk choice in the space. With about 251 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab U.S. Large-Cap Growth ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SCHG is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $123.69 billion in assets, Invesco QQQ has $267 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
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.