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Strategic beta

Strategic beta funds may help alter a portfolio's overall risk, improve the return profile, and diversify exposure to achieve a desired outcome.

What we offer

In 2007, Charles Schwab Investment Management partnered with Research Affiliates to deliver investment options based on the Research Affiliates Fundamental Index strategy. Today we offer 12 ETF and mutual fund products that follow the Fundamental Index methodology, providing investors access to a straightforward, innovative indexing approach that offers a complement to traditional market cap–weighted and actively managed strategies.

Strategic beta

Our approach

Schwab Fundamental Index mutual funds and ETFs utilize a strategy that is non-price-weighted, seeking to deliver excess return versus a traditional market cap–weighted index. The Fundamental Index methodology is a disciplined approach that counters the constantly shifting sentiments of the broader market, while preserving many of the chief benefits of traditional market cap–weighting: investment capacity, liquidity, diversification, and broad market participation. The Schwab Fundamental Index mutual funds and ETFs span the investment spectrum from domestic equities to emerging markets.

Fundamental Index key differentiators

  • Schwab Fundamental Index mutual funds and ETFs provide investors with a broad range of options from domestic to international equities to global real estate, enabling investors to diversify their overall portfolio exposure. 
  • The Research Affiliates Fundamental Index methodology is a systematic, transparent approach that selects and weights securities based on fundamental measures of company size.
  • Schwab Fundamental Index ETFs are offered at an average of 0.30%, while the average multi-factor ETF is priced at 0.48%,1 providing clients with a low-cost, straightforward alternative approach to traditional market cap–weighted investing.

Advisor tools

Use these financial tools to gain more comprehensive insight into investment products.

Advisor tools

Fee impact simulator

Use the fee impact simulator to see the long-term effects of pricing on a portfolio.

Fund explorer

Help your clients get exceptional value from their investments with the fund explorer.

Featured strategic beta products

See our highlighted strategic beta mutual funds and ETFs, or browse all our investment products.

Strategic beta insights

See what our executives and strategists have to say about strategic beta investing.

Investment Insights

One potential opportunity is Fundamental Index® strategies, which may help reduce the negative effects of behavioral finance biases that can crop up during a market crisis like COVID-19.
Investment Insights

An explanation of key distinctions between the Dimensional Fund Advisors strategy and the approach employed by the Schwab Fundamental Index products.
Investment Insights

Fortune explains the difference between cap-weighted and fundamental index strategies.
Schwab Market Update

U.S. equities are mixed in afternoon action after the Dow and the S&P 500 threatened record highs yesterday. Focus on corporate profits remains, as Q3 earnings season shifts into a higher gear. However, the persistent uncertainties surrounding supply-chain bottlenecks, inflation expectations, the surge in energy prices, and monetary policy direction continue to keep sentiment in check. Fiscal policy is also adding to the mix, as Congress continues to wrangle over a spending package, while some positive news regarding vaccine boosters is also being digested. IBM, AT&T, and Tesla all beat earnings estimates but revenues were below expectations, while Southwest Airlines and American Airlines both reported smaller-than-expected losses following a challenging third quarter for air travel. Treasuries are lower following some recent steepening of the yield curve, and the U.S. dollar is ticking higher, while gold is losing modest ground, and crude oil prices are falling. The economic calendar is robust, as jobless claims came in better than expected, continuing their decline since the height of the pandemic, and the Philly Fed Manufacturing Index decelerated more than expected, while the Leading Economic Index rose for the seventh-straight month but at a slower rate than expected, and existing home sales solidly beat expectations. Europe finished mostly lower.