Lower costs. No minimums. More value.

CHARLES SCHWAB INVESTMENT MANAGEMENT

We are pleased to announce that, as of March 1, 2017, we lowered expenses on Schwab market cap index mutual funds to align with their Schwab ETFs™ equivalents1, which already have among the lowest expenses in the industry. Along with these changes, we eliminated investment minimums for these mutual funds, offering access to all investors for a single low cost—regardless of investment size. Also as of March 1, 2017, the expenses on five market cap index ETFs and Schwab Fundamental Index* ETFs were lowered. Pending shareholder approval, Schwab Fundamental Index* mutual funds will follow suit effective May 1, 2017.

Message from Marie Chandoha

Message from Marie Chandoha

February 2, 2017

Costs matter. That’s why over the last few years we have taken steps to support index investors by using our scale and efficiency to dramatically reduce costs and complexity. Today, I’m proud that we are further modernizing the index investing landscape. With a straightforward and transparent fee structure, Charles Schwab Investment Management is focused squarely on doing right by investors and the investment professionals who serve them.

A leader in investment management for more than 25 years, we have a deep understanding of what investors want, and we pride ourselves on delivering value they can see through a diverse selection of foundational products that aim to deliver consistent performance, but with an eye on managing risk and keeping expenses down.

Today, we manage more than $100 billion in index mutual funds and ETF assets, making us the 3rd largest index mutual fund provider and the 5th largest provider of ETFs. We credit our success to the trust investors place in us to focus on offering low cost, high quality solutions, and our commitment to putting investors first.

Marie Chandoha

President & CEO, Charles Schwab Investment Management

New low-expense ratios at a glance

Download a summary of changes >

New Schwab Market Cap Index Mutual Fund Expenses Effective on March 1, 2017 With No Minimums

Schwab Vanguard Fidelity
Previous
Expense Ratio 2
Previous
OER2
3/1/17 Operating
Expense Ratio
3/1/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER

Multi-Cap Core

Schwab Vanguard Fidelity
Previous
Expense Ratio 2
Previous
OER2
3/1/17 Operating
Expense Ratio
3/1/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
Schwab Total Stock Market Index Fund® Vanguard Total Stock
Market Index Fund
Fidelity Total Stock Market Index Fund
$3K Investment 0.09% 0.03% 0.15% 0.09%
$10K Investment 0.04% 0.045%
$5M Investment 0.03% 0.035%

2 As stated in the prospectus. Operating expenses represented a fund’s fees less any contractual waiver. The investment adviser and its affiliates had agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) as stated in the prospectus of each fund for so long as the investment adviser served as the adviser to the fund. This agreement was limited to each fund’s direct operating expenses and did not apply to acquired fund fees and expenses. The Board has approved the termination of this agreement with respect to each fund effective March 1, 2017.

3 An Institutional share class is expected to become available on 4/10/17 with an OER of 0.035%, according to an amended prospectus filing on 3/10/17. Vanguard offers the Vanguard Institutional Index Fund – Institutional class at 0.04%, which is a separate fund from the Vanguard 500 Index Fund, but is designed to track the S&P 500 Index.

S&P 500 Index

Schwab Vanguard Fidelity
Previous
Expense Ratio 2
Previous
OER2
3/1/17 Operating
Expense Ratio
3/1/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
  Schwab® S&P 500 Index Fund Vanguard 500
Index Fund
Fidelity 500
Index Fund
$3K Investment 0.09% 0.03% 0.14% 0.09%
$10K Investment 0.04% 0.045%
$5M Investment -3 0.035%

2 As stated in the prospectus. Operating expenses represented a fund’s fees less any contractual waiver. The investment adviser and its affiliates had agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) as stated in the prospectus of each fund for so long as the investment adviser served as the adviser to the fund. This agreement was limited to each fund’s direct operating expenses and did not apply to acquired fund fees and expenses. The Board has approved the termination of this agreement with respect to each fund effective March 1, 2017.

3 An Institutional share class is expected to become available on 4/10/17 with an OER of 0.035%, according to an amended prospectus filing on 3/10/17. Vanguard offers the Vanguard Institutional Index Fund – Institutional class at 0.04%, which is a separate fund from the Vanguard 500 Index Fund, but is designed to track the S&P 500 Index.

Large-Cap Core

Schwab Vanguard Fidelity
Previous
Expense Ratio 2
Previous
OER2
3/1/17 Operating
Expense Ratio
3/1/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
Schwab 1000 Index® Fund Vanguard Large-Cap
Index Fund
N/A
$3K Investment 0.29% 0.05% 0.18%
$10K Investment 0.06%
$5M Investment 0.05%

2 As stated in the prospectus. Operating expenses represented a fund’s fees less any contractual waiver. The investment adviser and its affiliates had agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) as stated in the prospectus of each fund for so long as the investment adviser served as the adviser to the fund. This agreement was limited to each fund’s direct operating expenses and did not apply to acquired fund fees and expenses. The Board has approved the termination of this agreement with respect to each fund effective March 1, 2017.

3 An Institutional share class is expected to become available on 4/10/17 with an OER of 0.035%, according to an amended prospectus filing on 3/10/17. Vanguard offers the Vanguard Institutional Index Fund – Institutional class at 0.04%, which is a separate fund from the Vanguard 500 Index Fund, but is designed to track the S&P 500 Index.

Small-Cap Core

Schwab Vanguard Fidelity
Previous
Expense Ratio 2
Previous
OER2
3/1/17 Operating
Expense Ratio
3/1/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
Schwab Small-Cap Index Fund® Vanguard Small-Cap
Index Fund
Fidelity Small Cap
Index Fund
$3K Investment 0.17% 0.05% 0.18% 0.19%
$10K Investment 0.06% 0.07%
$5M Investment 0.05% 0.06%

2 As stated in the prospectus. Operating expenses represented a fund’s fees less any contractual waiver. The investment adviser and its affiliates had agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) as stated in the prospectus of each fund for so long as the investment adviser served as the adviser to the fund. This agreement was limited to each fund’s direct operating expenses and did not apply to acquired fund fees and expenses. The Board has approved the termination of this agreement with respect to each fund effective March 1, 2017.

3 An Institutional share class is expected to become available on 4/10/17 with an OER of 0.035%, according to an amended prospectus filing on 3/10/17. Vanguard offers the Vanguard Institutional Index Fund – Institutional class at 0.04%, which is a separate fund from the Vanguard 500 Index Fund, but is designed to track the S&P 500 Index.

International Multi-Cap Core

Schwab Vanguard Fidelity
Previous
Expense Ratio 2
Previous
OER2
3/1/17 Operating
Expense Ratio
3/1/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
Schwab International Index Fund® Vanguard Developed Markets Index Fund Fidelity International Index Fund
$3K Investment 0.19% 0.06% 0.17% 0.19%
$10K Investment 0.07% 0.08%
$5M Investment 0.06% 0.06%

2 As stated in the prospectus. Operating expenses represented a fund’s fees less any contractual waiver. The investment adviser and its affiliates had agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) as stated in the prospectus of each fund for so long as the investment adviser served as the adviser to the fund. This agreement was limited to each fund’s direct operating expenses and did not apply to acquired fund fees and expenses. The Board has approved the termination of this agreement with respect to each fund effective March 1, 2017.

3 An Institutional share class is expected to become available on 4/10/17 with an OER of 0.035%, according to an amended prospectus filing on 3/10/17. Vanguard offers the Vanguard Institutional Index Fund – Institutional class at 0.04%, which is a separate fund from the Vanguard 500 Index Fund, but is designed to track the S&P 500 Index.

Inflation-Protected

Schwab Vanguard Fidelity
Previous
Expense Ratio 2
Previous
OER2
3/1/17 Operating
Expense Ratio
3/1/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
2/24/17 Operating
Expense Ratio
2/24/17
OER
Schwab® Treasury Inflation
Protected Securities Index Fund
Vanguard Short-Term Inflation-Protected Securities Index Fund Fidelity Inflation-
Protected Bond Index Fund
$3K Investment 0.19% 0.05% 0.16% 0.19%
$10K Investment 0.07% 0.09%
$5M Investment 0.04% 0.06%

2 As stated in the prospectus. Operating expenses represented a fund’s fees less any contractual waiver. The investment adviser and its affiliates had agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) as stated in the prospectus of each fund for so long as the investment adviser served as the adviser to the fund. This agreement was limited to each fund’s direct operating expenses and did not apply to acquired fund fees and expenses. The Board has approved the termination of this agreement with respect to each fund effective March 1, 2017.

3 An Institutional share class is expected to become available on 4/10/17 with an OER of 0.035%, according to an amended prospectus filing on 3/10/17. Vanguard offers the Vanguard Institutional Index Fund – Institutional class at 0.04%, which is a separate fund from the Vanguard 500 Index Fund, but is designed to track the S&P 500 Index.

2 As stated in the prospectus. Operating expenses represented a fund’s fees less any contractual waiver. The investment adviser and its affiliates had agreed to limit the total annual fund operating expenses (excluding interest, taxes and certain non-routine expenses) as stated in the prospectus of each fund for so long as the investment adviser served as the adviser to the fund. This agreement was limited to each fund’s direct operating expenses and did not apply to acquired fund fees and expenses. The Board has approved the termination of this agreement with respect to each fund effective March 1, 2017.

3 An Institutional share class is expected to become available on 4/10/17 with an OER of 0.035%, according to an amended prospectus filing on 3/10/17. Vanguard offers the Vanguard Institutional Index Fund – Institutional class at 0.04%, which is a separate fund from the Vanguard 500 Index Fund, but is designed to track the S&P 500 Index.

New Schwab ETF Expenses Effective on March 1, 2017

New Schwab Fundamental Index Mutual Fund Expenses Effective on May 1, 20175 With No Minimums

New Schwab Index Bond Mutual Funds: Launched on February 23, 2017

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