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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. 
  • Almost every Schwab Fundamental Index mutual fund and ETF has a track record that exceeds 5 years. Many mutual funds have nearly 10 years of performance history versus the average 4.8 years for multi-factor funds available today.1 
  • 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 0.54%,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

Due to rampant proliferation—especially in newer multi-factor ETFs—strategic beta requires new dimensions of evaluation to tackle the increased challenges in portfolio implementation.
Investment Insights

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