Author Topic: Schwab 1000 Index ETF - Any complaints versus other index funds?  (Read 591 times)

onemorebike

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I'm not one to track the specifics of the stock market and taking some of the advice from MMM and others on the forum of putting the majority of our funds in this (or another) index fund to set and forget. We have a small chunk of money saved that I'd like to get invested in the next week or so. Thought I'd run it past your educated eyes first. Any reason to avoid this approach?

jacoavluha

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #1 on: October 05, 2018, 11:51:23 AM »
it's fine. It's going to represent probably 90% of the total US stock market, by market cap. SP500 is ballpark 80%.

Why not just use the total market ETF (SCHB)?

Or, consider the Schwab Target Index ETFs, if you want a complete porftolio, with international, emerging markets, small caps, REITs, some bonds, in a single fund.

onemorebike

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #2 on: October 05, 2018, 12:34:39 PM »
What are the advantages/disadvantages of the total market ETF or Target Index ETF versus the Schwab 1000?

it's fine. It's going to represent probably 90% of the total US stock market, by market cap. SP500 is ballpark 80%.

Why not just use the total market ETF (SCHB)?

Or, consider the Schwab Target Index ETFs, if you want a complete porftolio, with international, emerging markets, small caps, REITs, some bonds, in a single fund.

jacoavluha

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #3 on: October 05, 2018, 05:51:53 PM »
What are the advantages/disadvantages of the total market ETF or Target Index ETF versus the Schwab 1000?

it's fine. It's going to represent probably 90% of the total US stock market, by market cap. SP500 is ballpark 80%.

Why not just use the total market ETF (SCHB)?

Or, consider the Schwab Target Index ETFs, if you want a complete porftolio, with international, emerging markets, small caps, REITs, some bonds, in a single fund.

Diversification

MustacheAndaHalf

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #4 on: October 06, 2018, 11:54:34 AM »
In terms of small cap stocks, SCHB and SCHK are 95% the same.
http://etfdb.com/etf/SCHK/
http://etfdb.com/etf/SCHB/

SCHB has an extra 5% mix of small/micro cap stocks, compared to large cap in Schwab 1000 ETF.  Most likely their performance will be very similar, just like their expense ratios (0.05% for SCHK vs 0.03% for SCHB).

If you feel more comfortable with Schwab 1000, I'd suggest buying that.  The bigger problem isn't the tiny difference between these funds, it's the time delay before you invest.

YttriumNitrate

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #5 on: October 06, 2018, 12:49:24 PM »
There's nothing inherently wrong with the Schwab 1000 Index ETF, however if you are planning on doing monthly contributions of small amounts you should probably look for an ETF that can be traded commission free.

jacoavluha

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #6 on: October 06, 2018, 01:30:25 PM »
Schwab 1000 ETF can be traded commission free at Schwab of course, and maybe at Etrade and Vanguard and other places. OP could verify.

onemorebike

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #7 on: October 06, 2018, 01:30:42 PM »
I hadn't thought about that. Are there any similar funds you are aware of?
There's nothing inherently wrong with the Schwab 1000 Index ETF, however if you are planning on doing monthly contributions of small amounts you should probably look for an ETF that can be traded commission free.

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YttriumNitrate

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #8 on: October 06, 2018, 02:03:46 PM »
I hadn't thought about that. Are there any similar funds you are aware of?
It depends on your brokerage. See which ones they offer commission free.

jacoavluha

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #9 on: October 06, 2018, 02:43:49 PM »
I hadn't thought about that. Are there any similar funds you are aware of?
There's nothing inherently wrong with the Schwab 1000 Index ETF, however if you are planning on doing monthly contributions of small amounts you should probably look for an ETF that can be traded commission free.

Sent from my Moto G (5) Plus using Tapatalk

1000 index is like halfway between SP500 index and total market index. They're all largely interchangeable.

MustacheAndaHalf

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #10 on: October 07, 2018, 11:26:43 AM »
Vanguard recently changed their cost to trade ~1800 ETFs to $0/trade.  You can buy Vanguard, iShares, Schwab, ... all for $0/buy and $0/sell.  The main advantage of Vanguard, in my opinion, is that it's hard to make mistakes there.  Any Vanguard ETF or fund you pick will have a low expense ratio.  Not always the lowest (VTI vs SCHB, ITOT for example), but always close (0.04% vs 0.03% in that prior example).

Radagast

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #11 on: October 07, 2018, 12:20:05 PM »
I was trying to look up tax efficiency, but I soon learned SCHK is so recent there is no information yet. Often new funds are least tax efficient in their first year so look out for that. I don't see much of a reason for one versus the other, but tend to err towards SCHB.

CoffeeR

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Re: Schwab 1000 Index ETF - Any complaints versus other index funds?
« Reply #12 on: October 07, 2018, 03:06:07 PM »
I believe SCHX, SCHK and SCHB are largely interchangeable. I prefer SCHB, but I use SCHK and SCHX as tax loss harvesting partners, so I own some SCHK. SCHB/SCHX costs 3 basis points, while SCHK costs 5 basis points. Also the bid/ask spread for SCHK is consistently higher than SCHB/SCHX, so I think SCHB/SCHX (cost and spread wise) are better alternatives to SCHK.