SECURITIES AND EXCHANGE COMMISSION
CERTIFIED SHAREHOLDER REPORT OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-06200
Schwab Investments – Schwab Taxable Bond Funds
and Schwab Municipal Bond Funds
(Exact name of registrant as specified in charter)
211 Main Street, San Francisco, California 94105
(Address of principal executive offices) (Zip code)
Schwab Investments – Schwab Taxable Bond Funds and Schwab Municipal Bond Funds
211 Main Street, San Francisco, California 94105
(Name and address of agent for service)
Registrant’s telephone number, including area code: (415) 636-7000
Date of fiscal year end: August 31
Date of reporting period: August 31, 2024
Item 1: Report(s) to Shareholders.
Schwab Treasury Inflation Protected Securities Index Fund
This annual shareholder report contains important information about the fund for the period of September 1, 2023, to August 31,
2024.
You can find additional information about the fund at
www.schwabassetmanagement.com/prospectus
.
You can also request
this information by calling
or by sending an email request to
orders@mysummaryprospectus.com
.
If you purchase
or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to
shareholders and other information about the fund are available from your financial intermediary.
FUND COSTS FOR THE LAST year ENDED August 31, 2024
(BASED ON A HYPOTHETICAL $10,000 INVESTMENT)
| | |
Schwab Treasury Inflation Protected Securities Index Fund | | |
MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE
For the 12-month reporting period ended August 31, 2024, the fund returned 6.07%. The Bloomberg US Aggregate Bond Index,
which serves at the fund’s regulatory index and provides a broad measure of market performance, returned 7.30%. The fund
generally invests in securities that are included in the Bloomberg US Treasury Inflation-Linked Bond Index (Series-L)
SM
which
returned 6.17%. The fund does not seek to track the regulatory index. Differences between the return of the fund and the return of
the Bloomberg US Treasury Inflation-Linked Bond Index (Series-L)
SM
may be attributable to, among other things, the operational
and transactional costs incurred by the fund and not the index.
■
Of the fund’s return, approximately two thirds came from income, with the remainder coming from price appreciation
Portfolio holdings may have changed
since
the report date.
Schwab Treasury Inflation Protected Securities Index Fund | Annual Report
The performance data quoted represents past performance. Past performance does not guarantee future results. Invest
men
t returns
and principal value of an investment will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.
To obtain performance information current to the most
recent month end, please visit
www.schwabassetmanagement.com/prospectus.
Performance of Hypothetical $10,000 Investment (August 31, 2014 - August 31, 2024)
| | | |
Fund: Schwab Treasury Inflation Protected Securities Index Fund (03/31/2006) | | | |
Bloomberg US Aggregate Bond Index 2 | | | |
Bloomberg US Treasury Inflation-Linked Bond Index (Series-L) SM | | | |
All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower
performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.
For index definitions, please see www.schwabassetmanagement.com/glossary.
Index ownership — Bloomberg
®
and Bloomberg US Treasury Inflation-Linked Bond Index (Series-L)
SM
are service marks of Bloomberg Finance L.P. and its affiliates, including
Bloomberg Index Services Limited (BISL), the administrator of the indices (collectively, “Bloomberg”). Bloomberg is not affiliated with Charles Schwab Investment
Management, Inc., dba Schwab Asset Management, and Bloomberg does not approve, endorse, review, or recommend Schwab Treasury Inflation Protected Securities Index
Fund. Bloomberg does not guarantee the timeliness, accurateness, or completeness of any data or information relating to Schwab Treasury Inflation Protected Securities
Index Fund.
Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.
In anticipation of new regulatory requirements, the fund’s regulatory index has changed from the Bloomberg US Treasury Inflation-Linked Bond Index (Series-L)
SM
to the
Bloomberg US Aggregate Bond Index. The Bloomberg US Aggregate Bond Index provides a broad measure of market performance. The fund generally invests in securities
that are included in the Bloomberg US Treasury Inflati
on-Li
nked Bond Index (Series-L)
SM
. The fund
does
not seek to track the regulatory index.
Schwab Treasury Inflation Protected Securities Index Fund | Annual Report
| |
| |
| |
Advisory Fees Paid by the Fund | |
| |
12-Month Distribution Yield | |
Weighted Average Maturity | |
| |
Business Interest Deduction (163j) | |
Portfolio Composition By Security Type % of Investments
Portfolio Composition By Credit Quality % of Investments
Portfolio holdings may have changed since the report date.
The fund’s yields, including the SEC Yield, are adjusted monthly based on changes in the rate of inflation and these changes can cause the yield to vary substantially from
month to month. Exceptionally high yield is attributable to the rise in inflation rate and might not be repeated. Exceptionally low or negative yield is attributable to the fall in
inflation rate and might not be repeated.
Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund(s) is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
Treasury Inflation Protected Securities (TIPS) are inflation-linked securities issued by the U.S. Government whose principal value is adjusted periodically in accordance with
the rise and fall in the inflation rate. Thus, the dividend amount payable is also impacted by variations in the inflation rate, as it is based upon the principal value of the bond.
It may fluctuate up or down. Repayment at maturity is guaranteed by the U.S. Government and may be adjusted for inflation to become the greater of the original face amount
at issuance or that face amount plus an adjustment for inflation. Treasury Inflation-Protected Securities are guaranteed by the U.S. Government, but inflation-protected bond
funds do not provide such a guarantee.
Includes the fund’s position(s) in money market mutual funds registered under the Investment Company Act of 1940, as amended.
Bloomberg Index Rating: Based on the middle rating of Moody’s, S&P and Fitch; when a rating from only two agencies is available, the lower is used; when only one agency
rates a bond, that rating is used. In cases where explicit bond level ratings may not be available, other sources may be used to classify securities by credit quality. Source:
Bloomberg Index Service Ltd.
Schwab Treasury Inflation Protected Securities Index Fund | Annual Report
AVAILABILITY OF ADDITIONAL INFORMATION
You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,
holdings, certain tax information, proxy voting information, and other information about the fund online at
www.schwabassetmanagement.com/prospectus
.
Proxy Voting Policies, Procedures and Results
A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available
without charge, upon request, by visiting the Schwab Funds’ website at
www.schwabassetmanagement.com/prospectus
, the
SEC’s website at
, or by contacting Schwab Funds at 1-877-824-5615.
Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended
June 30 is available, without charge, by visiting the fund’s website at
www.schwabassetmanagement.com/prospectus
or the
SEC’s website at
, by calling
, or by sending an email request to
orders@mysummaryprospectus.com
.
Schwab Treasury Inflation Protected Securities Index Fund | Annual Report
Schwab U.S. Aggregate Bond Index Fund
This annual shareholder report contains important information about the fund for the period of September 1, 2023, to August 31,
2024.
You can find additional information about the fund at
www.schwabassetmanagement.com/prospectus
. You can also request
this information by calling
or by sending an email request to
orders@mysummaryprospectus.com
.
If you purchase
or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to
shareholders and other information about the fund are available from your financial intermediary.
FUND COSTS FOR THE LAST year ENDED August 31, 2024
(BASED ON A HYPOTHETICAL $10,000 INVESTMENT)
| | |
Schwab U.S. Aggregate Bond Index Fund | | |
MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE
For the 12-month reporting period ended August 31, 2024, the fund returned 7.23%. The Bloomberg US Aggregate Bond Index
returned 7.30%. Differences between the return of the fund and the return of the index may be attributable to, among other things,
the operational and transactional costs incurred by the fund and not the index.
■
Of the fund’s return, over half came from income, with the remainder coming from price appreciation
■
The fund held positions in TBAs, or “to-be-announced” securities, which are mortgage-backed bonds that settle on a forward
date. The fund’s average month-end position in these securities was 1.8%, with a minimum exposure of 1.1% and maximum
exposure of 2.4% over the period.
Portfolio holdings may have
ch
anged since the report date.
Schwab U.S. Aggregate Bond Index Fund | Annual Report
The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns
and principal value of an investment will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.
To obtain performance information current to the most
recent month end, please visit
www.schwabassetmanagement.com/prospectus
.
Performance of Hypothetical $10,000 Investment (February 23, 2017 - August 31, 2024)
| | | |
Fund: Schwab U.S. Aggregate Bond Index Fund (02/23/2017) | | | |
Bloomberg US Aggregate Bond Index | | | |
All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower
performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.
For index definitions, please see www.schwabassetmanagement.com/glossary.
Index ownership — Bloomberg
®
and Bloomberg US Aggregate Bond Index are service marks of Bloomberg Finance L.P. and its affiliates, including Bloomberg Index Services
Limited (BISL), the administrator of the indices (collectively, “Bloomberg”). Bloomberg is not affiliated with Charles Schwab Investment Management, Inc., dba Schwab Asset
Management, and Bloomberg does not approve, endorse, review, or recommend Schwab U.S. Aggregate Bond Index Fund. Bloomberg does not guarantee the timeliness,
accurateness, or completeness of any data or information relating to Schwab U.S. Aggregate Bond Index Fund.
Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.
Schwab U.S. Aggregate Bond Index Fund | Annual Report
| |
| |
| |
Advisory Fees Paid by the Fund | |
| |
12-Month Distribution Yield | |
Weighted Average Maturity | |
Weighted Average Duration | |
Business Interest Deduction (163j) | |
Portfolio Composition By Security Type % of Investmen
ts
Portfolio Composition By Credit Quality % of Investments
Portfolio holdings may have changed since the report date.
Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund(s) is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
The fund may seek to obtain exposure to U.S. agency mortgage pass-through securities, in part or in full, through the use of “to-be-announced” or “TBA” transactions,
which are standardized contracts for future delivery of mortgage pass-through securities in which the exact mortgage pools to be delivered are not specified until a few
days prior to settlement. These transactions represented approximately 1.1% of net assets on August 31, 2024.
Includes the fund’s position(s) in money market mutual funds registered under the Investment Company Act of 1940, as amended.
Bloomberg Index Rating: Based on the middle rating of Moody’s, S&P and Fitch; when a rating from only two agencies is available, the lower is used; when only one agency
rates a bond, that rating is used. In cases where explicit bond level ratings may not be available, other sources may be used to classify securities by credit quality. Source:
Bloomberg Index Service Ltd.
Schwab U.S. Aggregate Bond Index Fund | Annual Report
AVAILABILITY OF ADDITIONAL INFORMATION
You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,
holdings, certain tax information, proxy voting information, and other information about the fund online at
www.schwabassetmanagement.com/prospectus
.
Proxy Voting Policies, Procedures and Results
A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available
without charge, upon request, by visiting the Schwab Funds’ website at
www.schwabassetmanagement.com/prospectus
, the
SEC’s website at
, or by contacting Schwab Funds at 1-877-824-5615.
Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended
June 30 is available, without charge, by visiting the fund’s website at
www.schwabassetmanagement.com/prospectus
or the
SEC’s website at
, by calling
, or by sending an email request to
orders@mysummaryprospectus.com
.
Schwab U.S. Aggregate Bond Index Fund | Annual Report
Schwab Short-Term Bond Index Fund
This annual shareholder report contains important information about the fund for the period of September 1, 2023, to August 31,
2024.
You can find additional information about the fund at
www.schwabassetmanagement.com/prospectus
. You can also request
this information by calling
or by sending an email request to
orders@mysummaryprospectus.com
.
If you purchase
or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to
shareholders and other information about the fund are available from your financial intermediary.
FUND COSTS FOR THE LAST year ENDED August 31, 2024
(BASED ON A HYPOTHETICAL $10,000 INVESTMENT)
| | |
Schwab Short-Term Bond Index Fund | | |
MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE
For the 12-month reporting period ended August 31, 2024, the fund returned 6.56%. The Bloomberg US Aggregate Bond Index,
which serves at the fund’s regulatory index and provides a broad measure of market performance, returned 7.30%. The fund
generally invests in securities that are included in the Bloomberg US Government/Credit 1-5 Year Index which returned 6.67%. The
fund does not seek to track the regulatory index. Differences between the return of the fund and the return of the Bloomberg US
Government/Credit 1-5 Year Index may be attributable to, among other things, the operational and transactional costs incurred by
the fund and not the index.
■
Of the fund’s return, approximately two thirds came from income, with the remainder coming from price appreciation
Portfolio holdings may have c
ha
nged since the report date.
Schwab Short-Term Bond Index Fund | Annual Report
The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value of an investment will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.
o obtain performance information current to the most
recent month end, please visit
www.schwabassetmanagement.com/prospectus
Performance of Hypothetical $10,000 Investment (February 23, 2017 - August 31, 2024)
| | | |
Fund: Schwab Short-Term Bond Index Fund (02/23/2017) | | | |
Bloomberg US Aggregate Bond Index 2 | | | |
Bloomberg US Government/Credit 1-5 Year Index | | | |
All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower
performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.
For index definitions, please see www.schwabassetmanagement.com/glossary.
Index ownership — Bloomberg
®
and Bloomberg US Government/Credit 1-5 Year Index are service marks of Bloomberg Finance L.P. and its affiliates, including Bloomberg Index
Services Limited (BISL), the administrator of the indices (collectively, “Bloomberg”). Bloomberg is not affiliated with Charles Schwab Investment Management, Inc., dba
Schwab Asset Management, and Bloomberg does not approve, endorse, review, or recommend Schwab Short-Term Bond Index Fund. Bloomberg does not guarantee the
timeliness, accurateness, or completeness of any data or information relating to Schwab Short-Term Bond Index Fund.
Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.
In anticipation of new regulatory requirements, the fund’s regulatory index has changed from the Bloomberg US Government/Credit 1-5 Year Index to the Bloomberg US
Aggregate Bond Index. The Bloomberg US Aggregate Bond Index provides a broad measure of market performance. The fund generally invests in securities that are included
in the Bloomberg US Government/Credit 1-5 Year Index. The fund does not seek to track the regulatory index.
Schwab Short-Term Bond Index Fund | Annual Report
| |
| |
| |
Advisory Fees Paid by the Fund | |
| |
12-Month Distribution Yield | |
Weighted Average Maturity | |
Weighted Average Duration | |
Business Interest Deduction ( 163j ) | |
Portfolio Composition By Security Type % of Investments
Portfolio Composition By Credit Quality % of Investments
Portfolio holdings may have changed since the report date.
Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund(s) is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
Includes the fund’s position(s) in money market mutual funds registered under the Investment Company Act of 1940, as amended.
Bloomberg Index Rating: Based on the middle rating of Moody’s, S&P and Fitch; when a rating from only two agencies is available, the lower is used; when only one agency
rates a bond, that rating is used. In cases where explicit bond level ratings may not be available, other sources may be used to classify securities by credit quality. Source:
Bloomberg Index Service Ltd.
Schwab Short-Term Bond Index Fund | Annual Report
AVAILABILITY OF ADDITIONAL INFORMATION
You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,
holdings, certain tax information, proxy voting information, and other information about the fund online at
www.schwabassetmanagement.com/prospectus
.
Proxy Voting Policies, Procedures and Results
A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available
without charge, upon request, by visiting the Schwab Funds’ website at
www.schwabassetmanagement.com/prospectus
, the
SEC’s website at
, or by contacting Schwab Funds at 1-877-824-5615.
Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended
June 30 is available, without charge, by visiting the fund’s website at
www.schwabassetmanagement.com/prospectus
or the
SEC’s website at
, by calling
, or by sending an email request to
orders@mysummaryprospectus.com
.
Schwab Short-Term Bond Index Fund | Annual Report
Schwab Tax-Free Bond Fund
This annual shareholder report contains important information about the fund for the period of September 1, 2023, to August 31,
2024.
You can find additional information about the fund at
www.schwabassetmanagement.com/prospectus
. You can also request
this information by calling
or by sending an email request to
orders@mysummaryprospectus.com
.
If you purchase
or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to
shareholders and other information about the fund are available from your financial intermediary.
FUND COSTS FOR THE LAST year ENDED August 31, 2024
(BASED ON A HYPOTHETICAL $10,000 INVESTMENT)
| | |
Schwab Tax-Free Bond Fund | | |
MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE
For the 12-month reporting period ended August 31, 2024, the fund returned 5.64%. The Bloomberg Municipal Bond Index, which
serves at the fund’s regulatory index and provides a broad measure of market performance, returned 6.09%. The Bloomberg
Municipal 3-15 Year Blend Index which returned 5.14%, is the fund’s additional index, and is more representative of the fund’s
investment universe than the regulatory index.
■
The municipal bond market experienced significant increase in new issue supply during the reporting period as:
●
Tax-exempt yields fell from their most recent peak in October 2023, leading to more attractive borrowing costs for issuers
●
Low municipal-to-U.S. Treasury yield ratios created opportunity for issuers to refund outstanding taxable bonds with tax-exempt
bonds and save on net interest costs
■
The fund’s overweight in the 15+ year portion of the yield curve positively contributed to relative performance as yields fell
over
the
reporting period
■
The fund’s underweight to AAA and AA rated securities and overweight to A and BBB rated securities contributed
to re
lative
performance as A and BBB rated securities outperformed over the reporting period
Portfolio holdings may have changed since the report date.
Schwab Tax-Free Bond Fund | Annual Report
The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns
and principal value of an investment will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.
To obtain performance information current to the most
recent month end, please visit
www.schwabassetmanagement.com/prospectus
Performance of Hypothetical $10,000 Investment (August 31, 2014 - August 31, 2024)
| | | |
Fund: Schwab Tax-Free Bond Fund (09/11/1992) | | | |
Bloomberg Municipal Bond Index 3 | | | |
Bloomberg Municipal 3-15 Year Blend Index | | | |
All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower
performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.
For index definitions, please see www.schwabassetmanagement.com/glossary.
Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.
Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the total return/yield may have been lower.
In anticipation of new regulatory requirements, the fund’s regulatory index has changed from the Bloomberg Municipal 3-15 Year Blend Index to the Bloomberg Municipal
Bond Index. The Bloomberg Municipal Bond Index provides a broad measure of market performance. The Bloomberg Municipal 3-15 Year Blend Index is the fund’s
additional index and is more representative of the fund’s investment universe than the regulatory index.
Schwab Tax-Free Bond Fund | Annual Report
| |
| |
| |
Advisory Fees Paid by the Fund | |
| |
30-Day SEC Yield-No Waiver | |
12-Month Distribution Yield | |
Weighted Average Maturity | |
Weighted Average Duration | |
Tax Exempt Income Distribut ion | |
Portfolio Composition By Security Type % of Investments
Portfolio Composition By Credit Quality % of Investments
Portfolio holdings may have changed since the report date.
Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the 30-Day SEC Yield and 12-Month Distribution Yield
may have been lower. The 30-Day SEC Yield-No Waiver is the yield if fund expenses had not been partially absorbed by the investment adviser and its affiliates.
Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund(s) is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
Bloomberg Index Rating: Based on the middle rating of Moody’s, S&P and Fitch; when a rating from only two agencies is available, the lower is used; when only one agency
rates a bond, that rating is used. In cases where explicit bond level ratings may not be available, other sources may be used to classify securities by credit quality. Source:
Bloomberg Index Service Ltd.
Schwab Tax-Free Bond Fund | Annual Report
AVAILABILITY OF ADDITIONAL INFORMATION
You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,
holdings, certain tax information, proxy voting information, and other information about the fund online at
www.schwabassetmanagement.com/prospectus
.
Proxy Voting Policies, Procedures and Results
A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available
without charge, upon request, by visiting the Schwab Funds’ website at
www.schwabassetmanagement.com/prospectus
, the
SEC’s website at
, or by contacting Schwab Funds at 1-877-824-5615.
Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended
June 30 is available, without charge, by visiting the fund’s website at
www.schwabassetmanagement.com/prospectus
or the
SEC’s website at
, by calling
, or by sending an email request to
orders@mysummaryprospectus.com
.
Schwab Tax-Free Bond Fund | Annual Report
Schwab California Tax-Free Bond Fund
This annual shareholder report contains important information about the fund for the period of September 1, 2023, to August 31,
2024.
You can find additional information about the fund at
www.schwabassetmanagement.com/prospectus
. You can also request
this information by calling
or by sending an email request to
orders@mysummaryprospectus.com
.
If you purchase
or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to
shareholders and other information about the fund are available from your financial intermediary.
FUND COSTS FOR THE LAST year ENDED August 31, 2024
(BASED ON A HYPOTHETICAL $10,000 INVESTMENT)
| | |
Schwab California Tax-Free Bond Fund | | |
MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE
For the 12-month reporting period ended August 31, 2024, the fund returned 5.55%. The Bloomberg Municipal Bond Index, which
serves at the fund’s regulatory index and provides a broad measure of market performance, returned 6.09%. The Bloomberg
California Municipal 3-15 Year Blend Index which returned 4.85%, is the fund’s additional index, and is more representative of the
fund’s investment universe than the regulatory index.
■
The municipal bond market experienced significant increase in new issue supply during the reporting period as:
●
Tax-exempt yields fell from their most recent peak in October 2023, leading to more attractive borrowing costs for issuers
●
Low municipal-to-U.S. Treasury yield ratios created opportunity for issuers to refund outstanding taxable bonds with tax-exempt
bonds and save on net interest costs
■
The fund’s overweight in the 15+ year portion of the yield curve positively contributed to relative performance as yields fell over the
reporting period
■
The fund’s underweight to AAA and AA rated securities and overweight to A and BBB rated securities contributed to relative
perfor
m
ance as A and BBB rated securities outperformed over the reporting period
Portfolio holdings may have changed since the report date.
Schwab California Tax-Free Bond Fund | Annual Report
The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns
and principal value of an investment will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.
To obtain performance information current to the most
recent month end, please visit
www.schwabassetmanagement.com/prospectus
.
Performance of Hypothetical $10,000 Investment (August 31, 2014 - August 31, 2024)
| | | |
Fund: Schwab California Tax-Free Bond Fund (02/24/1992) | | | |
Bloomberg Municipal Bond Index 3 | | | |
Bloomberg California Municipal 3-15 Year Blend Index 4 | | | |
S&P California AMT-Free Municipal Bond Index | | | |
All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower
performance. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.
For index definitions, please see www.schwabassetmanagement.com/glossary.
Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.
Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the total return/yield may have been lower.
In anticipation of new regulatory requirements, the fund’s regulatory index has changed from the Bloomberg California Municipal 3-15 Year Blend Index to the Bloomberg
Municipal Bond Index. The Bloomberg Municipal Bond Index provides a broad measure of market performance. The Bloomberg California Municipal 3-15 Year Blend Index is
the fund’s additional index and is more representative of the fund’s investment universe than the regulatory index.
The Bloomberg California Municipal 3-15 Year Blend Index was established effective January 1, 2020. Performance shown prior to January 1, 2020 is based on a subset of
securities included in the Bloomberg Municipal 3-15 Year Blend Index.
Information not available to the fund.
Schwab California Tax-Free Bond Fund | Annual Report
| |
| |
| |
Advisory Fees Paid by the Fund | |
| |
30-Day SEC Yield-No Waiver | |
12-Month Distribution Yield | |
Weighted Average Maturity | |
Weighted Average Duration | |
Tax Exempt Income Distribution | |
Portfolio Composition By Security Type % of Investments
Portfolio Composition By Credit Quality % of Investments
Portfolio holdings may have changed since the report date.
Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the 30-Day SEC Yield and 12-Month Distribution Yield
may have been lower. The 30-Day SEC Yield-No Waiver is the yield if fund expenses had not been partially absorbed by the investment adviser and its affiliates.
Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund(s) is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
Bloomberg Index Rating: Based on the middle rating of Moody’s, S&P and Fitch; when a rating from only two agencies is available, the lower is used; when only one agency
rates a bond, that rating is used. In cases where explicit bond level ratings may not be available, other sources may be used to classify securities by credit quality. Source:
Bloomberg Index Service Ltd.
Schwab California Tax-Free Bond Fund | Annual Report
AVAILABILITY OF ADDITIONAL INFORMATION
You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,
holdings, certain tax information, proxy voting information, and other information about the fund online at
www.schwabassetmanagement.com/prospectus
.
Proxy Voting Policies, Procedures and Results
A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available
without charge, upon request, by visiting the Schwab Funds’ website at
www.schwabassetmanagement.com/prospectus
, the
SEC’s website at
, or by contacting Schwab Funds at 1-877-824-5615.
Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended
June 30 is available, without charge, by visiting the fund’s website at
www.schwabassetmanagement.com/prospectus
or the
SEC’s website at
, by calling
, or by sending an email request to
orders@mysummaryprospectus.com
.
Schwab California Tax-Free Bond Fund | Annual Report
Schwab Opportunistic Municipal Bond Fund
This annual shareholder report contains important information about the fund for the period of September 1, 2023, to August 31,
2024.
You can find additional information about the fund at
www.schwabassetmanagement.com/prospectus
. You can also request
this information by calling
or by sending an email request to
orders@mysummaryprospectus.com
.
If you purchase
or hold fund shares through a financial intermediary, the fund’s prospectus, Statement of Additional Information (SAI), reports to
shareholders and other information about the fund are available from your financial intermediary.
FUND COSTS FOR THE LAST year ENDED August 31, 2024
(BASED ON A HYPOTHETICAL $10,000 INVESTMENT)
| | |
Schwab Opportunistic Municipal Bond Fund | | |
MANAGEMENT’S DISCUSSION OF FUND PERFORMANCE
For the 12-month reporting period ended August 31, 2024, the fund returned 7.39%. The Bloomberg Municipal Bond Index returned
6.09%.
■
The municipal bond market experienced significant increase in new issue supply during the reporting period as:
●
Tax-exempt yields fell from their most recent peak in October 2023, leading to more attractive borrowing costs for issuers
●
Low municipal-to-U.S. Treasury yield ratios created opportunity for issuers to refund outstanding taxable bonds with tax-exempt
bonds and save on net interest costs
■
The fund’s overweight in the 15+ year portion of the yield curve positively contributed to relative performance as yields fell over the
reporting period
■
The fund’s underweight to AAA and AA rated securities and overweight to A and BBB rated securities contributed to relative
performance as A and BBB rated securities outperformed over the reporting period
Portfolio
hold
ings may
ha
ve ch
an
ged sinc
e the
report date.
Schwab Opportunistic Municipal Bond Fund | Annual Report
The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns
and principal value of an investment will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.
To obtain performance information current to the most
recent month end, please visit
www.schwabassetmanagement.com/prospectus
Performance of Hypothetical $10,000 Investment (August 31, 2014 - August 31, 2024)
| | | |
Fund: Schwab Opportunistic Municipal Bond Fund (03/31/2014) 4 | | | |
Bloomberg Municipal Bond Index | | | |
All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs,
which
would lower
performance
. Indices are unmanaged and cannot be invested in directly. Performance results less than one year are not annualized.
For index definitions, please see www.schwabassetmanagement.com/glossary.
Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.
Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the total return/yield may have been lower.
Effective August 10, 2020, the Wasmer Schroeder High Yield Municipal Fund (the predecessor fund) was reorganized into the Schwab Opportunistic Municipal Bond Fund.
The
performance and financial history prior to August 10, 2020 are that of the predecessor fund.
Inception date is that of the predecessor fund.
Schwab Opportunistic Municipal Bond Fund | Annual Report
| |
| |
| |
Advisory Fees Paid by the Fund | |
| |
30-Day SEC Yield-No Waiver | |
12-Month Distribution Yield | |
Weighted Average Maturity | |
| |
Tax Exempt Income Distribution | |
Portfolio Composition By Security Type % of Investments
Portfolio Composition By Credit Quality % of Investments
Portfolio holdings may have changed since the report date.
Fund expenses may have been partially absorbed by the investment adviser and its affiliates. Without these reductions, the 30-Day SEC Yield and 12-Month Distribution Yield
may have been lower. The 30-Day SEC Yield-No Waiver is the yield if fund expenses had not been partially absorbed by the investment adviser and its affiliates.
Fixed-income securities are subject to increased loss of principal during periods of rising interest rates. An investment in the fund(s) is not insured or guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency.
Bloomberg Index Rating: Based on the middle rating of Moody’s, S&P and Fitch; when a rating from only two agencies is available, the lower is used; when only one agency
rates a bond, that rating is used. In cases where explicit bond level ratings may not be available, other sources may be used to classify securities by credit quality. Source:
Bloomberg Index Service Ltd.
Schwab Opportunistic Municipal Bond Fund | Annual Report
AVAILABILITY OF ADDITIONAL INFORMATION
You can find the fund’s prospectus, Statement of Additional Information (SAI), reports to shareholders, financial information,
holdings, certain tax information, proxy voting information, and other information about the fund online at
www.schwabassetmanagement.com/prospectus
.
Proxy Voting Policies, Procedures and Results
A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available
without charge, upon request, by visiting the Schwab Funds’ website at
www.schwabassetmanagement.com/prospectus
, the
SEC’s website at
, or by contacting Schwab Funds at 1-877-824-5615.
Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended
June 30 is available, without charge, by visiting the fund’s website at
www.schwabassetmanagement.com/prospectus
or the
SEC’s website at
, by calling
, or by sending an email request to
orders@mysummaryprospectus.com
.
Schwab Opportunistic Municipal Bond Fund | Annual Report
Item 2: Code of Ethics.
| (a) | Registrant has adopted a code of ethics that applies to its principal executive officer, principal financial officer, and any other persons who perform a similar function, regardless of whether these individuals are employed by Registrant or a third party. |
| (c) | During the period covered by the report, no amendments were made to the provisions of this code of ethics. |
| (d) | During the period covered by the report, Registrant did not grant any waivers, including implicit waivers, from the provisions of this code of ethics. |
| (f)(1) | Registrant has filed this code of ethics as an exhibit pursuant to Item 19(a)(1) of Form N-CSR. |
Item 3: Audit Committee Financial Expert.
Registrant’s Board of Trustees has determined that Kimberly S. Patmore, Michael J. Beer and J. Derek Penn, each currently serving on its audit, compliance and valuation committee, are each an “audit committee financial expert,” as such term is defined in Item 3 of Form N-CSR. Each member of Registrant’s audit, compliance and valuation committee is “independent” under the standards set forth in Item 3 of Form N-CSR.
The designation of each of Ms. Patmore, Mr. Beer and Mr. Penn as an “audit committee financial expert” pursuant to Item 3 of Form N-CSR does not (i) impose upon such individual any duties, obligations, or liability that are greater than the duties, obligations and liability imposed upon such individual as a member of Registrant’s audit, compliance and valuation committee or Board of Trustees in the absence of such designation; and (ii) affect the duties, obligations or liability of any other member of Registrant’s audit, compliance and valuation committee or Board of Trustees.
Item 4: Principal Accountant Fees and Services.
Registrant is composed of eight operational series. Six series have a fiscal year-end of August 31, whose annual financial statements are reported in Item 1, one series has a fiscal year-end of October 31, and one series has a fiscal year-end of the last day of February. Principal accountant fees disclosed in Items 4(a)-(d) and 4(g) include fees billed for services rendered to each of the eight operational series during 2024/2025 and 2023/2024, based on their respective 2024/2025 and 2023/2024 fiscal years, as applicable.
The following table presents fees billed by the principal accountant in each of the last two fiscal years for the services rendered to the Funds:
| | | | | | | | | | | | | | |
(a) Audit Fees1 | | (b) Audit-Related Fees | | (c) Tax Fees2 | | (d) All Other Fees |
Fiscal Year 2024/2025 | | Fiscal Year
2023/2024 | | Fiscal Year
2024/2025 | | Fiscal Year
2023/2024 | | Fiscal Year
2024/2025 | | Fiscal Year
2023/2024 | | Fiscal Year
2024/2025 | | Fiscal Year
2023/2024 |
$283,400 | | $280,635 | | $0 | | $0 | | $26,280 | | $26,280 | | $0 | | $0 |
| 1 | The nature of the services includes audit of the registrant’s annual financial statements and normally provided services in connection with regulatory filings for those fiscal years. |
| 2 | The nature of the services includes tax compliance, tax advice and tax planning. |
(e)(1) Registrant’s audit, compliance and valuation committee does not have pre-approval policies and procedures as described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
(2) There were no services described in each of paragraphs (b) through (d) above (including services required to be approved by Registrant’s audit, compliance and valuation committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X) that were approved by Registrant’s audit, compliance and valuation committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Not applicable.
(g) Below are the aggregate non-audit fees billed in each of the last two fiscal years by Registrant’s principal accountant for services rendered to Registrant, to Registrant’s investment adviser, and to any entity controlling, controlled by, or under common control with Registrant’s investment adviser that provides ongoing services to Registrant.
| | |
| 2024/2025: $2,757,348 | | 2023/2024: $3,399,066 |
(h) During the past fiscal year, all non-audit services provided by Registrant’s principal accountant to either Registrant’s investment adviser or to any entity controlling, controlled by, or under common control with Registrant’s investment adviser that provides ongoing services to Registrant were pre-approved. Included in the audit, compliance and valuation committee’s pre-approval was the review and consideration as to whether the provision of these non-audit services is compatible with maintaining the principal accountant’s independence.
(i) Not applicable.
(j) Not applicable.
Item 5: Audit Committee of Listed Registrants.
Not applicable.
Item 6: Schedule of Investments.
The schedules of investments are included as part of the report to shareholders filed under Item 7 of this Form.
Item 7: Financial Statements and Financial Highlights for Open-End Management Investment Companies.
Annual Holdings and Financial Statements | August 31, 2024
Schwab Taxable Bond Funds
Schwab Treasury Inflation
Protected Securities Index Fund
Schwab U.S. Aggregate
Bond Index Fund
Schwab Short-Term
Bond Index Fund
Fund investment adviser: Charles Schwab Investment Management, Inc., dba Schwab Asset Management®
Distributor: Charles Schwab & Co., Inc. (Schwab)
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
1
Schwab Treasury Inflation Protected Securities Index Fund
Financial Statements
| | | | | | |
|
Net asset value at beginning of period | | | | | | |
Income (loss) from investment operations: | | | | | | |
Net investment income (loss)1 | | | | | | |
Net realized and unrealized gains (losses) | | | | | | |
Total from investment operations | | | | | | |
| | | | | | |
Distributions from net investment income | | | | | | |
Distributions from net realized gains | | | | | | |
| | | | | | |
Net asset value at end of period | | | | | | |
| | | | | | |
|
Ratios to average net assets: | | | | | | |
| | | | | | |
Net investment income (loss) | | | | | | |
| | | | | | |
Net assets, end of period (x 1,000,000) | | | | | | |
| Calculated based on the average shares outstanding during the period. |
| Ratio includes less than 0.005% of non-routine proxy expenses. |
2
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Treasury Inflation Protected Securities Index Fund
Portfolio Holdings as of August 31, 2024
For fixed rate securities, the rate shown is the interest rate (the rate established when the security was issued). The maturity date shown for all the securities is the final legal maturity. Inflation-protected securities are fixed-income securities whose principal value is periodically adjusted by the rate of inflation. The interest rate on these instruments is generally lower at issuance than typical bonds or notes. Over the life of an inflation-indexed instrument interest will be paid based on a principal value, which is adjusted for any inflation or deflation.
SECURITY RATE, MATURITY DATE | | |
TREASURIES 99.8% OF NET ASSETS |
U.S. Treasury Inflation Protected Securities |
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SECURITY RATE, MATURITY DATE | | |
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Total Treasuries
(Cost $2,622,088,935) | |
| | |
Short-Term Investments 0.1% OF NET ASSETS |
|
|
State Street Institutional U.S. Government Money Market Fund, Premier Class 5.24% (a) | | |
Total Short-Term Investments
(Cost $3,179,424) | |
Total Investments in Securities
(Cost $2,625,268,359) | |
| The rate shown is the annualized 7-day yield. |
The following is a summary of the inputs used to value the fund’s investments as of August 31, 2024 (see financial note 2(a) for additional information):
| QUOTED PRICES IN
ACTIVE MARKETS FOR
IDENTICAL ASSETS
(LEVEL 1) | OTHER SIGNIFICANT
OBSERVABLE INPUTS
(LEVEL 2) | SIGNIFICANT
UNOBSERVABLE INPUTS
(LEVEL 3) | |
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| As categorized in the Portfolio Holdings. |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
3
Schwab Treasury Inflation Protected Securities Index Fund
Statement of Assets and Liabilities
|
Investments in securities, at value - unaffiliated issuers (cost $2,625,268,359) | | |
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Capital received from investors | | |
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4
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Treasury Inflation Protected Securities Index Fund
Statement of Operations
For the period September 1, 2023 through August 31, 2024 |
|
Interest received from securities - unaffiliated issuers | | |
Dividends received from securities - unaffiliated issuers | | |
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|
REALIZED AND UNREALIZED GAINS (LOSSES) |
Net realized losses on sales of securities - unaffiliated issuers | | |
Net change in unrealized appreciation (depreciation) on securities - unaffiliated issuers | | |
Net realized and unrealized gains | | |
Increase in net assets resulting from operations | | |
| See financial note 2(b), Inflation-Protected Securities, for additional information. |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
5
Schwab Treasury Inflation Protected Securities Index Fund
Statement of Changes in Net Assets
For the current and prior report periods
|
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Net change in unrealized appreciation (depreciation) | | | |
Increase (decrease) in net assets resulting from operations | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS |
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TRANSACTIONS IN FUND SHARES |
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Net transactions in fund shares | | | | | |
|
SHARES OUTSTANDING AND NET ASSETS |
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Total increase (decrease) | | | | | |
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6
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Financial Statements
| | | | | | |
|
Net asset value at beginning of period | | | | | | |
Income (loss) from investment operations: | | | | | | |
Net investment income (loss)1 | | | | | | |
Net realized and unrealized gains (losses) | | | | | | |
Total from investment operations | | | | | | |
| | | | | | |
Distributions from net investment income | | | | | | |
Distributions from net realized gains | | | | | | |
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Net asset value at end of period | | | | | | |
| | | | | | |
|
Ratios to average net assets: | | | | | | |
| | | | | | |
Net investment income (loss) | | | | | | |
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Net assets, end of period (x 1,000,000) | | | | | | |
| Calculated based on the average shares outstanding during the period. |
| Ratio includes less than 0.005% of non-routine proxy expenses. |
| Includes to-be-announced (TBA) transactions ( if any) (see financial note 2 for additional information). |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
7
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024
For fixed rate securities, the rate shown is the interest rate (the rate established when the security was issued). All securities are currently in a fixed rate coupon period based on index eligibility requirements and the fund’s investment objective. Variable rate securities are subject to index requirements and will be removed from the index and fund prior to converting from a fixed rate coupon to a variable rate coupon. The maturity date shown for all the securities is the final legal maturity.
SECURITY RATE, MATURITY DATE | | |
CORPORATES 24.2% OF NET ASSETS |
|
Financial Institutions 7.9% |
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American Express Credit Corp. |
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Australia & New Zealand Banking Group Ltd. |
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Banco Bilbao Vizcaya Argentaria SA |
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SECURITY RATE, MATURITY DATE | | |
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8
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
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Bank of New York Mellon Corp. |
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SECURITY RATE, MATURITY DATE | | |
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Canadian Imperial Bank of Commerce |
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Capital One Financial Corp. |
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Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
9
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
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Citizens Financial Group, Inc. |
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SECURITY RATE, MATURITY DATE | | |
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Commonwealth Bank of Australia |
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Discover Financial Services |
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First-Citizens Bank & Trust Co. |
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10
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
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Goldman Sachs Group, Inc. |
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SECURITY RATE, MATURITY DATE | | |
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Huntington Bancshares, Inc. |
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|
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|
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|
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| | |
| | |
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| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
11
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
|
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|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Manufacturers & Traders Trust Co. |
| | |
| | |
| | |
Mitsubishi UFJ Financial Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
5.41%, 04/19/34 (a)(b)(c) | | |
| | |
| | |
| | |
Mizuho Financial Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
12
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
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| | |
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| | |
| | |
| | |
| | |
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| | |
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| | |
| | |
| | |
| | |
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| | |
|
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
National Australia Bank Ltd. |
| | |
| | |
| | |
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| | |
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|
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|
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| | |
| | |
| | |
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| | |
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|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
PNC Financial Services Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
13
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Santander Holdings USA, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Santander U.K. Group Holdings PLC |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Sumitomo Mitsui Financial Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
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| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
14
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Brokerage/Asset Managers/Exchanges 0.4% |
Affiliated Managers Group, Inc. |
| | |
Ameriprise Financial, Inc. |
| | |
| | |
| | |
Apollo Global Management, Inc. |
| | |
| | |
|
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
15
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Brookfield Capital Finance LLC |
| | |
Brookfield Finance I U.K. PLC/Brookfield Finance, Inc. |
| | |
Brookfield Finance LLC/Brookfield Finance, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Cboe Global Markets, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
5.64%, 05/19/29 (a)(b)(f) | | |
| | |
| | |
6.20%, 11/17/29 (a)(b)(f) | | |
| | |
| | |
| | |
| | |
| | |
5.85%, 05/19/34 (a)(b)(f) | | |
6.14%, 08/24/34 (a)(b)(f) | | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
|
| | |
| | |
HA Sustainable Infrastructure Capital, Inc. |
| | |
Intercontinental Exchange, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Jefferies Financial Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
16
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Raymond James Financial, Inc. |
| | |
| | |
| | |
|
| | |
TPG Operating Group II LP |
| | |
| | |
|
AerCap Ireland Capital DAC/AerCap Global Aviation Trust |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Apollo Debt Solutions BDC |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
ARES Strategic Income Fund |
| | |
Bain Capital Specialty Finance, Inc. |
| | |
|
| | |
BlackRock TCP Capital Corp. |
| | |
| | |
Blackstone Private Credit Fund |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Blackstone Secured Lending Fund |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Blue Owl Credit Income Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Blue Owl Technology Finance Corp. |
| | |
Blue Owl Technology Finance Corp. II |
| | |
Franklin BSP Capital Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
17
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
HPS Corporate Lending Fund |
| | |
| | |
Main Street Capital Corp. |
| | |
| | |
Morgan Stanley Direct Lending Fund |
| | |
New Mountain Finance Corp. |
| | |
Oaktree Specialty Lending Corp. |
| | |
| | |
Oaktree Strategic Credit Fund |
| | |
| | |
|
| | |
| | |
Sixth Street Lending Partners |
| | |
Sixth Street Specialty Lending, Inc. |
| | |
| | |
| | |
|
Andrew W Mellon Foundation |
| | |
|
| | |
| | |
| | |
| | |
|
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
American Financial Group, Inc. |
| | |
| | |
American International Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
American National Group, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
Aon Corp./Aon Global Holdings PLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
Arch Capital Group U.S., Inc. |
| | |
|
| | |
| | |
| | |
18
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Assured Guaranty U.S. Holdings, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
AXIS Specialty Finance LLC |
| | |
| | |
Berkshire Hathaway Finance Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Brighthouse Financial, Inc. |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Cincinnati Financial Corp. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
CNO Financial Group, Inc. |
| | |
| | |
Corebridge Financial, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
19
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
Everest Reinsurance Holdings, Inc. |
| | |
| | |
| | |
F&G Annuities & Life, Inc. |
| | |
| | |
Fairfax Financial Holdings Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Fidelity National Financial, Inc. |
| | |
| | |
First American Financial Corp. |
| | |
| | |
|
| | |
| | |
| | |
Hanover Insurance Group, Inc. |
| | |
Hartford Financial Services Group, Inc. |
| | |
| | |
| | |
| | |
| | |
Horace Mann Educators Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Marsh & McLennan Cos., Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
20
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
Nationwide Financial Services, Inc. |
| | |
|
| | |
Old Republic International Corp. |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
Principal Financial Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Prudential Financial, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Prudential Funding Asia PLC |
| | |
|
| | |
| | |
Reinsurance Group of America, Inc. |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
RenaissanceRe Holdings Ltd. |
| | |
| | |
Selective Insurance Group, Inc. |
| | |
|
| | |
Stewart Information Services Corp. |
| | |
Transatlantic Holdings, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
21
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
Willis North America, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
|
| | |
| | |
Alexandria Real Estate Equities, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
|
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| | |
| | |
AvalonBay Communities, Inc. |
| | |
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|
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| | |
| | |
| | |
| | |
| | |
| | |
Brixmor Operating Partnership LP |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
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|
| | |
| | |
| | |
| | |
| | |
| | |
COPT Defense Properties LP |
| | |
| | |
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|
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|
| | |
| | |
| | |
| | |
22
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
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|
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|
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| | |
|
| | |
| | |
| | |
| | |
| | |
Healthcare Realty Holdings LP |
| | |
| | |
| | |
| | |
|
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| | |
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| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
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| | |
Invitation Homes Operating Partnership LP |
| | |
| | |
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|
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|
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|
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|
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| | |
Mid-America Apartments LP |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
National Health Investors, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Omega Healthcare Investors, Inc. |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
23
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Phillips Edison Grocery Center Operating Partnership I LP |
| | |
Piedmont Operating Partnership LP |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
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| | |
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| | |
| | |
| | |
Public Storage Operating Co. |
| | |
| | |
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|
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| | |
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| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Retail Opportunity Investments Partnership LP |
| | |
Rexford Industrial Realty LP |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Sun Communities Operating LP |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
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| | |
|
| | |
| | |
24
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
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| | |
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|
| | |
| | |
| | |
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| | |
| | |
|
|
|
Air Products & Chemicals, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
AngloGold Ashanti Holdings PLC |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Barrick North America Finance LLC |
| | |
| | |
Barrick PD Australia Finance Pty. Ltd. |
| | |
SECURITY RATE, MATURITY DATE | | |
BHP Billiton Finance USA Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Celanese U.S. Holdings LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Celulosa Arauco y Constitucion SA |
| | |
| | |
|
| | |
| | |
| | |
|
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| | |
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| | |
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|
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| | |
| | |
|
| | |
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| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
25
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Huntsman International LLC |
| | |
| | |
International Flavors & Fragrances, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
LYB International Finance BV |
| | |
| | |
LYB International Finance II BV |
| | |
LYB International Finance III LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
LyondellBasell Industries NV |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Newmont Corp./Newcrest Finance Pty. Ltd. |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Packaging Corp. of America |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
26
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Rio Tinto Finance USA Ltd. |
| | |
| | |
| | |
Rio Tinto Finance USA PLC |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Smurfit Kappa Treasury ULC |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Suzano International Finance BV |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
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|
| | |
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|
|
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Acuity Brands Lighting, Inc. |
| | |
|
| | |
| | |
|
| | |
Allegion U.S. Holding Co., Inc. |
| | |
| | |
|
| | |
| | |
| | |
Amcor Flexibles North America, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
27
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
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| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Caterpillar Financial Services Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
CNH Industrial Capital LLC |
| | |
| | |
| | |
| | |
| | |
|
| | |
CRH America Finance, Inc. |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
28
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
Fortune Brands Innovations, Inc. |
| | |
| | |
| | |
| | |
|
| | |
GE Capital International Funding Co. Unlimited Co. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
Honeywell International, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Huntington Ingalls Industries, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
Illinois Tool Works, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Johnson Controls International PLC |
| | |
| | |
| | |
| | |
Johnson Controls International PLC/Tyco Fire & Security Finance SCA |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
29
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
L3Harris Technologies, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Lennox International, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Martin Marietta Materials, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Precision Castparts Corp. |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
30
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
Rockwell Automation, Inc. |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
Stanley Black & Decker, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Teledyne Technologies, Inc. |
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
Trane Technologies Financing Ltd. |
| | |
| | |
| | |
| | |
| | |
Trane Technologies Global Holding Co. Ltd. |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
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| | |
| | |
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| | |
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| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Westinghouse Air Brake Technologies Corp. |
| | |
| | |
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
31
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
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| | |
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| | |
|
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Bell Telephone Co. of Canada or Bell Canada |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
British Telecommunications PLC |
| | |
| | |
Charter Communications Operating LLC/Charter Communications Operating Capital |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
32
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
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| | |
| | |
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| | |
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| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Deutsche Telekom International Finance BV |
| | |
| | |
Discovery Communications LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Interpublic Group of Cos., Inc. |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
33
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Omnicom Group, Inc./Omnicom Capital, Inc. |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Rogers Communications, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
Take-Two Interactive Software, Inc. |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
Time Warner Cable Enterprises LLC |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
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| | |
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| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
TWDC Enterprises 18 Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
34
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Verizon Communications, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Warnermedia Holdings, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
Alibaba Group Holding Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
35
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
American Honda Finance Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
Choice Hotels International, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Dick's Sporting Goods, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
36
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
Ford Motor Credit Co. LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
General Motors Financial Co., Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
GLP Capital LP/GLP Financing II, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
37
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
Magna International, Inc. |
| | |
| | |
| | |
Marriott International, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Mercedes-Benz Finance North America LLC |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
38
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
O'Reilly Automotive, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Toll Brothers Finance Corp. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Toyota Motor Credit Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
39
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Consumer Non-Cyclical 3.8% |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
Advocate Health & Hospitals Corp. |
| | |
| | |
| | |
Agilent Technologies, Inc. |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
40
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
Anheuser-Busch Cos. LLC/Anheuser-Busch InBev Worldwide, Inc. |
| | |
| | |
| | |
Anheuser-Busch InBev Finance, Inc. |
| | |
| | |
| | |
| | |
Anheuser-Busch InBev Worldwide, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Archer-Daniels-Midland Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Baptist Health South Florida Obligated Group |
| | |
Baptist Healthcare System Obligated Group |
Series 20B
3.54%, 08/15/50 (a) | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
BAT International Finance PLC |
| | |
| | |
| | |
|
| | |
Baxter International, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
BayCare Health System, Inc. |
Series 2020
3.83%, 11/15/50 (a) | | |
Baylor Scott & White Holdings |
| | |
| | |
| | |
|
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
41
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Beth Israel Lahey Health, Inc. |
| | |
|
| | |
| | |
| | |
| | |
Bio-Rad Laboratories, Inc. |
| | |
| | |
Bon Secours Mercy Health, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Catholic Health Services of Long Island Obligated Group |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Children's Health System of Texas |
| | |
|
| | |
Children's Hospital Corp. |
| | |
| | |
Children's Hospital Medical Center |
| | |
Children's Hospital of Philadelphia |
| | |
Church & Dwight Co., Inc. |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
42
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
Cleveland Clinic Foundation |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Coca-Cola Consolidated, Inc. |
| | |
| | |
| | |
Coca-Cola Femsa SAB de CV |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Community Health Network, Inc. |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Constellation Brands, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Corewell Health Obligated Group |
| | |
Cottage Health Obligated Group |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
43
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Dartmouth-Hitchcock Health |
| | |
|
| | |
DH Europe Finance II SARL |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
Duke University Health System, Inc. |
| | |
Edwards Lifesciences Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
Fomento Economico Mexicano SAB de CV |
| | |
Franciscan Missionaries of Our Lady Health System, Inc. |
| | |
GE HealthCare Technologies, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
GlaxoSmithKline Capital PLC |
| | |
GlaxoSmithKline Capital, Inc. |
| | |
| | |
| | |
Hackensack Meridian Health, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Hartford HealthCare Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
44
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Hoag Memorial Hospital Presbyterian |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
Indiana University Health, Inc. Obligated Group |
| | |
|
| | |
| | |
Integris Baptist Medical Center, Inc. |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
JBS USA LUX SA/JBS USA Food Co./JBS Luxembourg SARL |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Johns Hopkins Health System Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Kaiser Foundation Hospitals |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
45
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Koninklijke Ahold Delhaize NV |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Laboratory Corp. of America Holdings |
| | |
| | |
| | |
| | |
Mass General Brigham, Inc. |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
McLaren Health Care Corp. |
Series A
4.39%, 05/15/48 (a) | | |
Mead Johnson Nutrition Co. |
| | |
| | |
Medtronic Global Holdings SCA |
| | |
| | |
|
| | |
| | |
Memorial Sloan-Kettering Cancer Center |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
46
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Molson Coors Beverage Co. |
| | |
| | |
| | |
Mondelez International, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Montefiore Obligated Group |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
New York & Presbyterian Hospital |
| | |
| | |
| | |
| | |
Northwell Healthcare, Inc. |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
NY Society for Relief of Ruptured & Crippled Maintaining Hosp Special Surgery |
Series 2020
2.67%, 10/01/50 (a) | | |
|
| | |
| | |
| | |
Ochsner LSU Health System of North Louisiana |
| | |
|
| | |
Orlando Health Obligated Group |
| | |
| | |
PeaceHealth Obligated Group |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Pepsico Singapore Financing I Pte. Ltd. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Pfizer Investment Enterprises Pte. Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
47
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Philip Morris International, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Piedmont Healthcare, Inc. |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Providence St. Joseph Health Obligated Group |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Regeneron Pharmaceuticals, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
Shire Acquisitions Investments Ireland DAC |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
STERIS Irish FinCo UnLtd Co. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
48
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Takeda Pharmaceutical Co. Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Thermo Fisher Scientific, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
Universal Health Services, Inc. |
| | |
| | |
|
| | |
| | |
Utah Acquisition Sub, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
West Virginia United Health System Obligated Group |
| | |
|
| | |
| | |
| | |
| | |
| | |
Willis-Knighton Medical Center |
| | |
|
| | |
| | |
| | |
Yale-New Haven Health Services Corp. |
| | |
Zimmer Biomet Holdings, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
49
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
Baker Hughes Holdings LLC |
| | |
Baker Hughes Holdings LLC/Baker Hughes Co-Obligor, Inc. |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
BP Capital Markets America, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
Canadian Natural Resources Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Cheniere Corpus Christi Holdings LLC |
| | |
| | |
| | |
Cheniere Energy Partners LP |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Columbia Pipeline Group, Inc. |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Continental Resources, Inc. |
| | |
| | |
|
| | |
| | |
| | |
DCP Midstream Operating LP |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
50
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Eastern Gas Transmission & Storage, Inc. |
| | |
| | |
Enbridge Energy Partners LP |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
EnLink Midstream Partners LP |
| | |
| | |
| | |
| | |
Enterprise Products Operating LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
51
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Kinder Morgan Energy Partners LP |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
| | |
Occidental Petroleum Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
52
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Patterson-UTI Energy, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Pioneer Natural Resources Co. |
| | |
| | |
| | |
| | |
Plains All American Pipeline LP/PAA Finance Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Sabine Pass Liquefaction LLC |
| | |
| | |
| | |
| | |
| | |
Schlumberger Finance Canada Ltd. |
| | |
Schlumberger Investment SA |
| | |
| | |
| | |
| | |
Shell International Finance BV |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Spectra Energy Partners LP |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
53
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
Targa Resources Partners LP/Targa Resources Partners Finance Corp. |
| | |
| | |
| | |
| | |
| | |
|
| | |
Tennessee Gas Pipeline Co. LLC |
| | |
Texas Eastern Transmission LP |
| | |
TotalEnergies Capital International SA |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
TransCanada PipeLines Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Transcontinental Gas Pipe Line Co. LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Valero Energy Partners LP |
| | |
SECURITY RATE, MATURITY DATE | | |
Western Midstream Operating LP |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
Booz Allen Hamilton, Inc. |
| | |
|
| | |
California Institute of Technology |
| | |
| | |
Case Western Reserve University |
| | |
|
| | |
| | |
Claremont Mckenna College |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
George Washington University |
| | |
| | |
| | |
54
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
Jacobs Engineering Group, Inc. |
| | |
| | |
|
| | |
| | |
Leland Stanford Junior University |
| | |
| | |
Massachusetts Institute of Technology |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
| | |
President & Fellows of Harvard College |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Thomas Jefferson University |
| | |
Trustees of Boston College |
| | |
Trustees of Princeton University |
| | |
| | |
Trustees of the University of Pennsylvania |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
University of Notre Dame du Lac |
| | |
University of Southern California |
| | |
| | |
| | |
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
William Marsh Rice University |
| | |
|
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
| | |
Advanced Micro Devices, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
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|
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|
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| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
55
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
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|
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| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
Automatic Data Processing, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
Broadcom Corp./Broadcom Cayman Finance Ltd. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
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| | |
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| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
Broadridge Financial Solutions, Inc. |
| | |
| | |
| | |
CDW LLC/CDW Finance Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
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| | |
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|
| | |
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| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Dell International LLC/EMC Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
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|
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|
| | |
| | |
| | |
| | |
| | |
56
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Equinix Europe 2 Financing Corp. LLC |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
FactSet Research Systems, Inc. |
| | |
| | |
Fidelity National Information Services, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
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|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Genpact Luxembourg SARL/Genpact USA, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Hewlett Packard Enterprise Co. |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
IBM International Capital Pte. Ltd. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
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| | |
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| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
International Business Machines Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
57
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
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| | |
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| | |
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|
| | |
| | |
| | |
|
| | |
| | |
| | |
Keysight Technologies, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
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|
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|
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|
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
|
| | |
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| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
Microchip Technology, Inc. |
| | |
| | |
|
| | |
| | |
| | |
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|
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|
| | |
| | |
| | |
58
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
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|
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|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
NXP BV/NXP Funding LLC/NXP USA, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
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| | |
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| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
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|
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|
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|
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| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
59
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
Tencent Music Entertainment Group |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
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| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Tyco Electronics Group SA |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
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|
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|
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
|
American Airlines 2012-1 Class AA Pass-Through Trust |
| | |
American Airlines 2015-2 Class AA Pass-Through Trust |
| | |
American Airlines 2016-1 Class AA Pass-Through Trust |
| | |
American Airlines 2016-2 Class AA Pass-Through Trust |
| | |
American Airlines 2017-1 Class AA Pass-Through Trust |
| | |
American Airlines 2019-1 Class AA Pass-Through Trust |
| | |
Burlington Northern Santa Fe LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
60
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Canadian National Railway Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Canadian Pacific Railway Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
CH Robinson Worldwide, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
Delta Air Lines 2020-1 Class AA Pass-Through Trust |
| | |
|
| | |
| | |
| | |
FedEx Corp. 2020-1 Class AA Pass-Through Trust |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
JB Hunt Transport Services, Inc. |
| | |
JetBlue 2019-1 Class AA Pass-Through Trust |
| | |
JetBlue 2020-1 Class A Pass-Through Trust |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
61
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Triton Container International Ltd./TAL International Container Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
United Airlines 2014-1 Class A Pass-Through Trust |
| | |
United Airlines 2014-2 Class A Pass-Through Trust |
| | |
United Airlines 2016-1 Class AA Pass-Through Trust |
| | |
SECURITY RATE, MATURITY DATE | | |
United Airlines 2016-2 Class AA Pass-Through Trust |
| | |
United Airlines 2018-1 Class AA Pass-Through Trust |
| | |
United Airlines 2019-1 Class AA Pass-Through Trust |
| | |
United Airlines 2019-2 Class AA Pass-Through Trust |
| | |
United Airlines 2020-1 Class A Pass-Through Trust |
| | |
United Airlines 2023-1 Class A Pass-Through Trust |
| | |
United Airlines Pass-Through Trust |
| | |
| | |
United Parcel Service, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
|
|
|
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|
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|
| | |
| | |
| | |
|
| | |
| | |
62
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Algonquin Power & Utilities Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
American Electric Power Co., Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Arizona Public Service Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Atlantic City Electric Co. |
| | |
| | |
|
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
Baltimore Gas & Electric Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Berkshire Hathaway Energy Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
CenterPoint Energy Houston Electric LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Cleco Corporate Holdings LLC |
| | |
| | |
Cleveland Electric Illuminating Co. |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
63
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Connecticut Light & Power Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Consolidated Edison Co. of New York, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Constellation Energy Generation LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Dominion Energy South Carolina, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
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|
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| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Duke Energy Carolinas LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
64
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
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| | |
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| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
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|
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| | |
|
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
65
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Evergy Kansas Central, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
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|
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Florida Power & Light Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Iberdrola International BV |
| | |
|
| | |
| | |
Indiana Michigan Power Co. |
| | |
| | |
| | |
| | |
Interstate Power & Light Co. |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
John Sevier Combined Cycle Generation LLC |
| | |
|
| | |
| | |
| | |
Louisville Gas & Electric Co. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
66
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
National Rural Utilities Cooperative Finance Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
NextEra Energy Capital Holdings, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Northern States Power Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
Oklahoma Gas & Electric Co. |
| | |
| | |
| | |
| | |
| | |
Oncor Electric Delivery Co. LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Pacific Gas & Electric Co. |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
67
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Potomac Electric Power Co. |
| | |
| | |
| | |
PPL Capital Funding, Inc. |
| | |
| | |
| | |
PPL Electric Utilities Corp. |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Public Service Co. of Colorado |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Public Service Co. of New Hampshire |
| | |
| | |
| | |
| | |
Public Service Co. of Oklahoma |
| | |
| | |
Public Service Electric & Gas Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Public Service Enterprise Group, Inc. |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
68
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
San Diego Gas & Electric Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Southern California Edison Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Southwestern Electric Power Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Southwestern Public Service Co. |
| | |
| | |
| | |
| | |
| | |
System Energy Resources, Inc. |
| | |
|
| | |
| | |
| | |
|
| | |
Tucson Electric Power Co. |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Virginia Electric & Power Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
69
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
Wisconsin Electric Power Co. |
| | |
| | |
| | |
| | |
Wisconsin Power & Light Co. |
| | |
| | |
| | |
| | |
Wisconsin Public Service Corp. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
CenterPoint Energy Resources Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Piedmont Natural Gas Co., Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Southern California Gas Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Southern Co. Gas Capital Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
|
American Water Capital Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
70
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
Essential Utilities, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Total Corporates
(Cost $1,336,648,583) | |
|
TREASURIES 43.1% OF NET ASSETS |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
71
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
72
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Total Treasuries
(Cost $2,225,840,624) | |
|
GOVERNMENT RELATED 4.5% OF NET ASSETS |
|
|
|
|
Oesterreichische Kontrollbank AG |
| | |
| | |
| | |
| | |
| | |
| | |
|
Export Development Canada |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
Kreditanstalt fuer Wiederaufbau |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Landwirtschaftliche Rentenbank |
| | |
| | |
| | |
| | |
| | |
| | |
|
Japan Bank for International Cooperation |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Japan International Cooperation Agency |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
73
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
|
Export-Import Bank of Korea |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
Federal Farm Credit Banks Funding Corp. | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Federal Home Loan Mortgage Corp. | | |
| | |
| | |
| | |
Federal National Mortgage Association | | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
Private Export Funding Corp. | | |
| | |
Tennessee Valley Authority | | |
| | |
| | |
| | |
| | |
|
|
|
|
|
| | |
|
| | |
| | |
| | |
| | |
Province of British Columbia |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
Province of New Brunswick |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
74
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
|
American Municipal Power, Inc. | | |
RB (Build America Bonds) Series 2010 | | |
| | |
| | |
RB (Build America Bonds) Series 2009F2 | | |
| | |
RB (Build America Bonds) Series 2010S3 | | |
| | |
Board of Regents of the University of Texas System | | |
| | |
| | |
| | |
| | |
| | |
| | |
GO (Build America Bonds) Series 2009 | | |
| | |
GO (Build America Bonds) Series 2009 | | |
| | |
GO (Build America Bonds) Series 2009 | | |
| | |
GO (Build America Bonds) Series 2009 | | |
| | |
California Earthquake Authority | | |
| | |
| | |
California State University | | |
| | |
| | |
| | |
| | |
| | |
| | |
Chicago O'Hare International Airport | | |
RB (Build America Bonds) Series 2010B | | |
| | |
| | |
| | |
Chicago Transit Authority Sales & Transfer Tax Receipts Revenue | | |
RB (Pension Funding) Series 2008A | | |
| | |
City of Atlanta GA Water & Wastewater Revenue | | |
| | |
| | |
GO Bonds (Pension Funding) Series 2017 | | |
| | |
| | |
| | |
City of San Antonio TX Electric & Gas Systems Revenue | | |
RB (Build America Bonds) Series 2009 | | |
| | |
SECURITY RATE, MATURITY DATE | | |
Commonwealth Financing Authority | | |
| | |
| | |
Commonwealth of Massachusetts | | |
GO (Build America Bonds) Series 2009 | | |
| | |
| | |
| | |
Commonwealth of Massachusetts Transportation Fund Revenue | | |
RB (Build America Bonds) Series 2010 | | |
| | |
| | |
| | |
| | |
County of Clark Department of Aviation | | |
RB (Build America Bonds) Series 2010C | | |
| | |
County of Miami-Dade FL Aviation Revenue | | |
| | |
| | |
Dallas Area Rapid Transit | | |
| | |
| | |
Dallas County Hospital District | | |
GO (Build America Bonds) Series C | | |
| | |
Dallas/Fort Worth International Airport | | |
| | |
| | |
| | |
| | |
| | |
| | |
District of Columbia Water & Sewer Authority | | |
| | |
| | |
East Bay Municipal Utility District Water System Revenue | | |
Water System RB (Build America Bonds) Series 2010 | | |
| | |
Foothill-Eastern Transportation Corridor Agency | | |
| | |
| | |
Golden State Tobacco Securitization Corp. | | |
| | |
| | |
| | |
| | |
| | |
| | |
Grand Parkway Transportation Corp. | | |
| | |
| | |
Health & Educational Facilities Authority of the State of Missouri | | |
| | |
| | |
GO (Build America Bonds) Series 2010 | | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
75
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
GO Bonds (Pension Funding) Series 2003 | | |
| | |
Illinois State Toll Highway Authority | | |
RB (Build America Bonds) Series A | | |
| | |
| | |
| | |
RB (Build America Bonds) Series B | | |
| | |
| | |
| | |
Kansas Development Finance Authority | | |
| | |
| | |
Los Angeles County Public Works Financing Authority | | |
| | |
Los Angeles Department of Water & Power Power System | | |
RB (Build America Bonds) Series 2010 | | |
| | |
Louisiana Local Government Environmental Facilities & Community Development Authority | | |
| | |
| | |
| | |
| | |
| | |
Series 2022-ELL, Class A3 | | |
| | |
Maryland Economic Development Corp | | |
| | |
Maryland Health & Higher Educational Facilities Authority | | |
| | |
| | |
| | |
| | |
Massachusetts School Building Authority | | |
| | |
| | |
Metropolitan Government Nashville & Davidson County Health & Educational Facs Board | | |
RB (Vanderbilt Univ Medical Center) Series 2016 B | | |
| | |
Metropolitan Transportation Authority | | |
RB (Build America Bonds) Series C | | |
| | |
RB (Build America Bonds) Series E | | |
| | |
Michigan Finance Authority | | |
| | |
| | |
Municipal Electric Authority of Georgia | | |
RB (Build America Bonds) Series 2010 | | |
| | |
RB (Build America Bonds) Series A | | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
New Jersey Economic Development Authority | | |
| | |
| | |
New Jersey Transportation Trust Fund Authority | | |
RB (Build America Bonds) Series 2010C | | |
| | |
New Jersey Turnpike Authority | | |
RB (Build America Bonds) Series 2009F | | |
| | |
RB (Build America Bonds) Series 2010A | | |
| | |
New York City Municipal Water Finance Authority | | |
RB (Build America Bonds) Series GG | | |
| | |
Water System RB (Build America Bonds) | | |
| | |
Water System RB (Build America Bonds) Series 2011CC | | |
| | |
Water System RB (Build America Bonds) Series AA-2-2009 | | |
| | |
New York City Transitional Finance Authority Future Tax Secured Revenue | | |
RB (Build America Bonds) Series 2010 | | |
| | |
New York State Dormitory Authority | | |
RB (Build America Bonds) Series 2010 | | |
| | |
| | |
| | |
New York State Urban Development Corp. | | |
| | |
RB (Build America Bonds) Series 2009 | | |
| | |
North Texas Tollway Authority | | |
RB (Build America Bonds) Series 2009B | | |
| | |
| | |
RB (Build America Bonds) Series 2010C | | |
| | |
| | |
GO Bonds (Pension Funding) Series 2003 | | |
| | |
Oregon School Boards Association | | |
| | |
| | |
Pennsylvania State University | | |
| | |
Port Authority of New York & New Jersey | | |
Consolidated Bonds 164th Series | | |
| | |
Consolidated Bonds 165th Series | | |
| | |
76
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Consolidated Bonds 168th Series | | |
| | |
Consolidated Bonds 174th Series | | |
| | |
Consolidated Bonds 181st Series | | |
| | |
Consolidated Bonds 192th Series | | |
| | |
Consolidated Bonds 215th Series | | |
| | |
Regents of the University of California Medical Center Pooled Revenue | | |
RB (Build America Bonds) Series F | | |
| | |
RB (Build America Bonds) Series H | | |
| | |
| | |
| | |
Regional Transportation District Sales Tax Revenue | | |
| | |
| | |
Rutgers The State University of New Jersey | | |
| | |
| | |
Sales Tax Securitization Corp. | | |
| | |
| | |
| | |
| | |
San Diego County Water Authority., Class B | | |
RB (Build America Bonds) Series 2010B | | |
| | |
San Jose Redevelopment Agency Successor Agency | | |
| | |
| | |
State Board of Administration Finance Corp. | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
GO (Build America Bonds) Series 2010 | | |
| | |
| | |
GO Mobility Fund Bonds (Build America Bonds) Series 2009A | | |
| | |
Texas Natural Gas Securitization Finance Corp. | | |
| | |
| | |
Texas Private Activity Bond Surface Transportation Corp. | | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Texas Transportation Commission | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
University of Pittsburgh-of the Commonwealth System of Higher Education | | |
| | |
| | |
| | |
General Revenue Pledge and Refunding Bonds, Series 2020 | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
|
Canada Government International Bonds |
| | |
| | |
| | |
| | |
|
Chile Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
77
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
Hungary Government International Bonds |
| | |
|
Indonesia Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
Israel Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
Republic of Italy Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
|
Mexico Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
Panama Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
Peru Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
78
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
Philippines Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
Republic of Poland Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
Korea International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
Uruguay Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
SECURITY RATE, MATURITY DATE | | |
|
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Asian Infrastructure Investment Bank |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Council of Europe Development Bank |
| | |
| | |
| | |
European Bank for Reconstruction & Development |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
79
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Inter-American Development Bank |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Inter-American Investment Corp. |
| | |
| | |
International Bank for Reconstruction & Development |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
International Finance Corp. |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Total Government Related
(Cost $244,167,322) | |
|
SECURITIZED 27.4% OF NET ASSETS |
|
Asset-Backed Securities 0.0% |
|
Capital One Multi-Asset Execution Trust |
| | |
| | |
|
PG&E Wildfire Recovery Funding LLC |
| | |
| | |
| | |
| | |
| | |
|
PG&E Wildfire Recovery Funding LLC |
| | |
| | |
|
Commercial Mortgage-Backed Security 1.9% |
|
Series 2017-BNK7, Class A5 | | |
| | |
Series 2017-BNK8, Class A4 | | |
| | |
Series 2017-BNK9, Class A4 | | |
| | |
Series 2019-BN19, Class A3 | | |
| | |
Series 2020-BN26, Class A4 | | |
| | |
Bank of America Merrill Lynch Commercial Mortgage Trust |
Series 2016-UB10, Class A3 | | |
| | |
|
| | |
| | |
|
Series 2019-B10, Class A4 | | |
| | |
Series 2019-B12, Class A5 | | |
| | |
Series 2019-B13, Class A4 | | |
| | |
| | |
| | |
Series 2020-B16, Class A5 | | |
| | |
80
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
Series 2016-CD2, Class A4 | | |
| | |
CFCRE Commercial Mortgage Trust |
| | |
| | |
| | |
| | |
| | |
| | |
Citigroup Commercial Mortgage Trust |
Series 2014-GC25, Class A4 | | |
| | |
Series 2016-GC36, Class A5 | | |
| | |
Series 2016-GC37, Class A4 | | |
| | |
| | |
| | |
|
Series 2014-LC17, Class A5 | | |
| | |
Series 2015-CR24, Class A5 | | |
| | |
Series 2015-LC23, Class A4 | | |
| | |
Series 2016-CR28, Class A4 | | |
| | |
Series 2016-DC2, Class A5 | | |
| | |
CSAIL Commercial Mortgage Trust |
Series 2019-C17, Class A5 | | |
| | |
|
Series 2016-NXSR, Class A4 | | |
| | |
Federal Home Loan Mortgage Corp. Multifamily Structured Pass-Through Certificates |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Federal National Mortgage Association-ACES |
Series 2015-M13, Class A2 | | |
| | |
Series 2016-M11, Class A2 | | |
| | |
GS Mortgage Securities Trust |
Series 2020-GC45, Class A5 | | |
| | |
JP Morgan Chase Commercial Mortgage Securities Trust |
Series 2016-JP4, Class A4 | | |
| | |
JPMBB Commercial Mortgage Securities Trust |
Series 2015-C32, Class A5 | | |
| | |
Series 2015-C33, Class A3 | | |
| | |
Series 2015-C33, Class A4 | | |
| | |
JPMCC Commercial Mortgage Securities Trust |
Series 2017-JP5, Class A5 | | |
| | |
JPMDB Commercial Mortgage Securities Trust |
| | |
| | |
Morgan Stanley Bank of America Merrill Lynch Trust |
Series 2016-C28, Class A4 | | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
81
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Morgan Stanley Capital I Trust |
| | |
| | |
Series 2015-UBS8, Class A4 | | |
| | |
| | |
| | |
Series 2020-HR8, Class A4 | | |
| | |
UBS Commercial Mortgage Trust |
| | |
| | |
| | |
| | |
Wells Fargo Commercial Mortgage Trust |
Series 2013-C33, Class A3 | | |
| | |
Series 2015-C28, Class A3 | | |
| | |
Series 2015-C30, Class A4 | | |
| | |
Series 2015-NXS4, Class A4 | | |
| | |
Series 2016-C32, Class A4 | | |
| | |
Series 2016-NXS5, Class A4 | | |
| | |
Series 2016-NXS5, Class A6 | | |
| | |
Series 2016-NXS6, Class ASB | | |
| | |
Series 2017-C40, Class A4 | | |
| | |
Series 2017-C41, Class A4 | | |
| | |
Series 2017-C42, Class A4 | | |
| | |
Series 2018-C44, Class A5 | | |
| | |
Series 2018-C47, Class A3 | | |
| | |
Series 2019-C50, Class A5 | | |
| | |
Series 2019-C51, Class A4 | | |
| | |
Series 2019-C53, Class A4 | | |
| | |
Series 2020-C55, Class A5 | | |
| | |
Series 2020-C58, Class A4 | | |
| | |
| | |
|
Mortgage-Backed Securities Pass-Through 25.5% |
Federal Home Loan Mortgage Corp. |
| | |
1.50%, 08/01/35 to 08/01/51 (a) | | |
2.00%, 01/01/28 to 03/01/52 (a) | | |
2.50%, 04/01/27 to 05/01/52 (a) | | |
3.00%, 08/01/26 to 06/01/53 (a) | | |
3.50%, 01/01/26 to 02/01/53 (a) | | |
4.00%, 05/01/26 to 10/01/52 (a) | | |
4.50%, 05/01/34 to 09/01/52 (a) | | |
5.00%, 11/01/33 to 06/01/53 (a) | | |
5.50%, 06/01/33 to 03/01/54 (a) | | |
6.00%, 05/01/32 to 05/01/54 (a) | | |
SECURITY RATE, MATURITY DATE | | |
6.50%, 02/01/36 to 01/01/54 (a) | | |
| | |
Federal National Mortgage Association |
1.00%, 03/01/36 to 07/01/36 (a) | | |
1.50%, 08/01/35 to 04/01/51 (a) | | |
2.00%, 12/01/27 to 04/01/52 (a) | | |
2.50%, 07/01/27 to 05/01/52 (a) | | |
3.00%, 10/01/26 to 05/01/52 (a) | | |
3.50%, 10/01/25 to 08/01/52 (a) | | |
4.00%, 06/01/27 to 07/01/52 (a) | | |
4.50%, 12/01/24 to 09/01/52 (a) | | |
5.00%, 11/01/33 to 04/01/54 (a) | | |
5.50%, 03/01/33 to 06/01/54 (a) | | |
6.00%, 04/01/35 to 08/01/54 (a) | | |
6.50%, 08/01/34 to 08/01/54 (a) | | |
7.00%, 10/01/53 to 07/01/54 (a) | | |
7.50%, 12/01/53 to 01/01/54 (a) | | |
Government National Mortgage Association |
1.50%, 03/20/51 to 10/20/51 (a) | | |
2.00%, 04/20/36 to 04/20/52 (a) | | |
2.50%, 08/20/27 to 06/20/52 (a) | | |
3.00%, 04/20/27 to 04/20/52 (a) | | |
3.50%, 09/20/32 to 08/20/52 (a) | | |
4.00%, 06/15/39 to 09/20/52 (a) | | |
4.50%, 07/15/39 to 04/20/54 (a) | | |
5.00%, 02/20/33 to 08/20/54 (a) | | |
5.50%, 04/15/33 to 08/20/54 (a) | | |
6.00%, 04/20/44 to 08/20/54 (a) | | |
6.50%, 01/20/53 to 08/20/54 (a) | | |
7.00%, 01/20/53 to 08/20/54 (a) | | |
| | |
Government National Mortgage Association, TBA |
| | |
| | |
| | |
Uniform Mortgage-Backed Security, TBA |
| | |
| | |
| | |
| | |
| | |
Total Securitized
(Cost $1,540,317,599) | |
82
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
| | |
Short-Term Investments 2.0% OF NET ASSETS |
|
|
State Street Institutional U.S. Government Money Market Fund, Premier Class 5.24% (m) | | |
State Street Institutional U.S. Government Money Market Fund, Premier Class 5.24% (m)(n) | | |
| | |
Total Short-Term Investments
(Cost $100,285,692) | |
Total Investments in Securities
(Cost $5,447,259,820) | |
| Supranational bonds represent the debt of international organizations or institutions such as the World Bank, the International Monetary Fund, regional multilateral development banks and others. |
| The effective maturity may be shorter than the final maturity shown because of the possibility of interim principal payments and prepayments or as the result of embedded demand features (puts or calls). |
| Security is in a fixed-rate coupon period. Based on index eligibility requirements and the fund’s investment objective this security will be removed from the index prior to converting to a floating rate security. |
| All or a portion of this security is on loan. Securities on loan were valued at $1,936,119. |
| Securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registrations, normally to qualified institutional buyers. At the period end, the value of these amounted to $14,255,748 or 0.3% of net assets. |
| Step up bond that pays an initial coupon rate for a set period and increased coupon rates at one or more preset intervals. Rate shown is as of period end. |
| Issuer is affiliated with the fund’s investment adviser. |
| Interest rate is subject to adjustments from time to time if a nationally recognized statistical rating organization downgrades (or subsequently upgrades) the debt rating assigned to the bond. |
| Guaranteed by the Republic of Germany. |
| |
| Perpetual security with no stated maturity date. Maturity date represents next call date. |
| Fixed rate is determined by a formula set forth in the security’s offering documents and is affected by the current WAC of the underlying loans. |
| Security or a portion of the security purchased on a delayed-delivery or when-issued basis. |
| The rate shown is the annualized 7-day yield. |
| Security purchased with cash collateral received for securities on loan. |
| |
| |
| |
| Real Estate Investment Trust |
| |
| Weighted Average Coupon, which is the weighted average gross interest rate of the securitized asset pool and is determined by the different speeds at which the underlying mortgages are paid down. |
Below is a summary of the fund’s transactions with affiliated issuers during the period ended August 31, 2024:
SECURITY
RATE, MATURITY DATE | | | | | NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | ACCRETION OF DISCOUNTS (AMORTIZATION OF PREMIUMS) | | | |
CORPORATES 0.0% OF NET ASSETS |
|
Financial Institutions 0.0% |
Brokerage/Asset Managers/Exchanges 0.0% |
|
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
83
Schwab U.S. Aggregate Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | | | | NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | ACCRETION OF DISCOUNTS (AMORTIZATION OF PREMIUMS) | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
The following is a summary of the inputs used to value the fund’s investments as of August 31, 2024 (see financial note 2(a) for additional information):
| QUOTED PRICES IN
ACTIVE MARKETS FOR
IDENTICAL ASSETS
(LEVEL 1) | OTHER SIGNIFICANT
OBSERVABLE INPUTS
(LEVEL 2) | SIGNIFICANT
UNOBSERVABLE INPUTS
(LEVEL 3) | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| As categorized in the Portfolio Holdings. |
84
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Statement of Assets and Liabilities
|
Investments in securities, at value - affiliated issuers (cost $2,811,372) | | |
Investments in securities, at value - unaffiliated issuers (cost $5,444,448,448) including securities on loan of $1,936,119 | | |
Deposit with broker for futures contracts | | |
Deposit with broker for TBA margin | | |
| | |
| | |
| | |
| | |
| | |
Income from securities on loan | | |
| | |
|
|
Collateral held for securities on loan | | |
| | |
| | |
Investments bought - delayed-delivery | | |
| | |
Distributions to shareholders | | |
| | |
| | |
| | |
|
|
Capital received from investors | | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
85
Schwab U.S. Aggregate Bond Index Fund
Statement of Operations
For the period September 1, 2023 through August 31, 2024 |
|
Interest received from securities - unaffiliated issuers (net of foreign withholding tax of ($73)) | | |
Dividends received from securities - unaffiliated issuers | | |
Interest received from securities - affiliated issuers | | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
|
REALIZED AND UNREALIZED GAINS (LOSSES) |
Net realized losses on sales of securities - affiliated issuers | | |
Net realized losses on sales of securities - unaffiliated issuers | | |
Net realized losses on futures contracts | | |
| | |
Net change in unrealized appreciation (depreciation) on securities - affiliated issuers | | |
Net change in unrealized appreciation (depreciation) on securities - unaffiliated issuers | | |
Net change in unrealized appreciation (depreciation) | | |
Net realized and unrealized gains | | |
Increase in net assets resulting from operations | | |
86
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab U.S. Aggregate Bond Index Fund
Statement of Changes in Net Assets
For the current and prior report periods
|
| | |
| | | |
| | | |
Net change in unrealized appreciation (depreciation) | | | |
Increase (decrease) in net assets resulting from operations | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS |
| | | |
TRANSACTIONS IN FUND SHARES |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Net transactions in fund shares | | | | | |
|
SHARES OUTSTANDING AND NET ASSETS |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
87
Schwab Short-Term Bond Index Fund
Financial Statements
| | | | | | |
|
Net asset value at beginning of period | | | | | | |
Income (loss) from investment operations: | | | | | | |
Net investment income (loss)1 | | | | | | |
Net realized and unrealized gains (losses) | | | | | | |
Total from investment operations | | | | | | |
| | | | | | |
Distributions from net investment income | | | | | | |
Distributions from net realized gains | | | | | | |
| | | | | | |
Net asset value at end of period | | | | | | |
| | | | | | |
|
Ratios to average net assets: | | | | | | |
| | | | | | |
Net investment income (loss) | | | | | | |
| | | | | | |
Net assets, end of period (x 1,000,000) | | | | | | |
| Calculated based on the average shares outstanding during the period. |
| Ratio includes less than 0.005% of non-routine proxy expenses. |
88
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024
For fixed rate securities, the rate shown is the interest rate (the rate established when the security was issued). All securities are currently in a fixed rate coupon period based on index eligibility requirements and the fund’s investment objective. Variable rate securities are subject to index requirements and will be removed from the index and fund prior to converting from a fixed rate coupon to a variable rate coupon. The maturity date shown for all the securities is the final legal maturity.
SECURITY RATE, MATURITY DATE | | |
CORPORATES 25.0% OF NET ASSETS |
|
Financial Institutions 11.0% |
|
|
| | |
| | |
| | |
|
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Australia & New Zealand Banking Group Ltd. |
| | |
| | |
| | |
Banco Bilbao Vizcaya Argentaria SA |
| | |
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|
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| | |
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| | |
SECURITY RATE, MATURITY DATE | | |
| | |
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| | |
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|
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|
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| | |
Bank of New York Mellon Corp. |
| | |
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|
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
89
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Canadian Imperial Bank of Commerce |
| | |
| | |
| | |
| | |
| | |
Capital One Financial Corp. |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
Citizens Financial Group, Inc. |
| | |
| | |
| | |
|
| | |
Commonwealth Bank of Australia |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
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| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
Discover Financial Services |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
Goldman Sachs Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
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|
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| | |
| | |
|
| | |
Huntington Bancshares, Inc. |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
90
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
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| | |
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|
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| | |
| | |
| | |
| | |
| | |
|
| | |
Manufacturers & Traders Trust Co. |
| | |
| | |
Mitsubishi UFJ Financial Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Mizuho Financial Group, Inc. |
| | |
| | |
| | |
| | |
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| | |
| | |
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|
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
National Australia Bank Ltd. |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
91
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
|
| | |
| | |
PNC Financial Services Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Santander Holdings USA, Inc. |
| | |
| | |
| | |
| | |
| | |
Santander U.K. Group Holdings PLC |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Sumitomo Mitsui Financial Group, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
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|
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|
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| | |
| | |
| | |
| | |
| | |
| | |
|
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|
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|
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| | |
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| | |
| | |
| | |
92
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Brokerage/Asset Managers/Exchanges 0.4% |
Ameriprise Financial, Inc. |
| | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
Cboe Global Markets, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
5.64%, 05/19/29 (b)(c)(e) | | |
| | |
6.20%, 11/17/29 (b)(c)(e) | | |
|
| | |
Intercontinental Exchange, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Jefferies Financial Group, Inc. |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
AerCap Ireland Capital DAC/AerCap Global Aviation Trust |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Apollo Debt Solutions BDC |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
ARES Strategic Income Fund |
| | |
Bain Capital Specialty Finance, Inc. |
| | |
| | |
|
| | |
BlackRock TCP Capital Corp. |
| | |
Blackstone Private Credit Fund |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
93
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
Blackstone Secured Lending Fund |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Blue Owl Credit Income Corp. |
| | |
| | |
| | |
| | |
| | |
Blue Owl Technology Finance Corp. |
| | |
Blue Owl Technology Finance Corp. II |
| | |
Franklin BSP Capital Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
HPS Corporate Lending Fund |
| | |
Main Street Capital Corp. |
| | |
| | |
| | |
Morgan Stanley Direct Lending Fund |
| | |
New Mountain Finance Corp. |
| | |
Oaktree Specialty Lending Corp. |
| | |
Oaktree Strategic Credit Fund |
| | |
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Sixth Street Lending Partners |
| | |
Sixth Street Specialty Lending, Inc. |
| | |
| | |
| | |
|
|
| | |
|
|
| | |
|
| | |
| | |
|
| | |
| | |
American International Group, Inc. |
| | |
American National Group, Inc. |
| | |
|
| | |
Aon Corp./Aon Global Holdings PLC |
| | |
|
| | |
|
| | |
| | |
|
| | |
|
| | |
Assured Guaranty U.S. Holdings, Inc. |
| | |
|
| | |
AXIS Specialty Finance PLC |
| | |
Berkshire Hathaway Finance Corp. |
| | |
|
| | |
Brighthouse Financial, Inc. |
| | |
|
| | |
| | |
|
| | |
| | |
Cincinnati Financial Corp. |
| | |
|
| | |
| | |
CNO Financial Group, Inc. |
| | |
94
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Corebridge Financial, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
F&G Annuities & Life, Inc. |
| | |
| | |
Fairfax Financial Holdings Ltd. |
| | |
Fidelity National Financial, Inc. |
| | |
|
| | |
Hartford Financial Services Group, Inc. |
| | |
Horace Mann Educators Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
|
| | |
Marsh & McLennan Cos., Inc. |
| | |
| | |
|
| | |
|
| | |
|
| | |
|
| | |
Old Republic International Corp. |
| | |
|
| | |
Principal Financial Group, Inc. |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
Prudential Financial, Inc. |
| | |
| | |
| | |
|
| | |
Reinsurance Group of America, Inc. |
| | |
RenaissanceRe Holdings Ltd. |
| | |
|
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Willis North America, Inc. |
| | |
| | |
| | |
|
|
| | |
Alexandria Real Estate Equities, Inc. |
| | |
| | |
| | |
|
| | |
| | |
AvalonBay Communities, Inc. |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
95
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Brixmor Operating Partnership LP |
| | |
| | |
| | |
|
| | |
| | |
COPT Defense Properties LP |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
Healthcare Realty Holdings LP |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
Invitation Homes Operating Partnership LP |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
Mid-America Apartments LP |
| | |
| | |
| | |
|
| | |
| | |
| | |
Omega Healthcare Investors, Inc. |
| | |
| | |
| | |
Piedmont Operating Partnership LP |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Public Storage Operating Co. |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Retail Opportunity Investments Partnership LP |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Sun Communities Operating LP |
| | |
| | |
|
| | |
|
| | |
| | |
96
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
|
|
Air Products & Chemicals, Inc. |
| | |
| | |
|
| | |
AngloGold Ashanti Holdings PLC |
| | |
|
| | |
| | |
BHP Billiton Finance USA Ltd. |
| | |
| | |
| | |
| | |
Celanese U.S. Holdings LLC |
| | |
| | |
| | |
| | |
Celulosa Arauco y Constitucion SA |
| | |
|
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
Huntsman International LLC |
| | |
International Flavors & Fragrances, Inc. |
| | |
|
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
LYB International Finance III LLC |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
| | |
Packaging Corp. of America |
| | |
|
| | |
| | |
Rio Tinto Finance USA Ltd. |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
Suzano International Finance BV |
| | |
|
| | |
|
| | |
|
| | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
| | |
|
| | |
Allegion U.S. Holding Co., Inc. |
| | |
|
| | |
| | |
|
| | |
|
| | |
|
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
97
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
Caterpillar Financial Services Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
CNH Industrial Capital LLC |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
Honeywell International, Inc. |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
Huntington Ingalls Industries, Inc. |
| | |
| | |
Illinois Tool Works, Inc. |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Johnson Controls International PLC |
| | |
Johnson Controls International PLC/Tyco Fire & Security Finance SCA |
| | |
|
| | |
L3Harris Technologies, Inc. |
| | |
| | |
| | |
|
| | |
Lennox International, Inc. |
| | |
|
| | |
| | |
| | |
Martin Marietta Materials, Inc. |
| | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
98
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
Rockwell Automation, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Stanley Black & Decker, Inc. |
| | |
| | |
Teledyne Technologies, Inc. |
| | |
| | |
|
| | |
| | |
|
| | |
Trane Technologies Financing Ltd. |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
Westinghouse Air Brake Technologies Corp. |
| | |
| | |
|
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
British Telecommunications PLC |
| | |
Charter Communications Operating LLC/Charter Communications Operating Capital |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Discovery Communications LLC |
| | |
| | |
| | |
|
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
99
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Interpublic Group of Cos., Inc. |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
Omnicom Group, Inc./Omnicom Capital, Inc. |
| | |
|
| | |
| | |
Rogers Communications, Inc. |
| | |
| | |
| | |
|
| | |
|
| | |
Take-Two Interactive Software, Inc. |
| | |
| | |
|
| | |
|
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|
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| | |
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| | |
| | |
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| | |
| | |
| | |
| | |
| | |
TWDC Enterprises 18 Corp. |
| | |
| | |
| | |
| | |
Verizon Communications, Inc. |
| | |
| | |
| | |
| | |
| | |
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| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Warnermedia Holdings, Inc. |
| | |
| | |
| | |
|
Alibaba Group Holding Ltd. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
American Honda Finance Corp. |
| | |
| | |
| | |
| | |
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100
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
Ford Motor Credit Co. LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
General Motors Financial Co., Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
|
| | |
| | |
GLP Capital LP/GLP Financing II, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
|
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|
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|
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|
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|
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| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Magna International, Inc. |
| | |
Marriott International, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
O'Reilly Automotive, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
101
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
|
| | |
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|
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|
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| | |
|
| | |
| | |
Toll Brothers Finance Corp. |
| | |
| | |
|
| | |
| | |
| | |
Toyota Motor Credit Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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|
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
Consumer Non-Cyclical 3.1% |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Advocate Health & Hospitals Corp. |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Anheuser-Busch InBev Worldwide, Inc. |
| | |
| | |
Archer-Daniels-Midland Co. |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
BAT International Finance PLC |
| | |
| | |
| | |
Baxter International, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
| | |
102
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
Church & Dwight Co., Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
|
| | |
Constellation Brands, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Edwards Lifesciences Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
GE HealthCare Technologies, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
GlaxoSmithKline Capital, Inc. |
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
|
| | |
|
| | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
103
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
JBS USA LUX SA/JBS USA Food Co./JBS Luxembourg SARL |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Kaiser Foundation Hospitals |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Laboratory Corp. of America Holdings |
| | |
|
| | |
|
| | |
| | |
Mead Johnson Nutrition Co. |
| | |
Medtronic Global Holdings SCA |
| | |
|
| | |
| | |
| | |
| | |
| | |
Molson Coors Beverage Co. |
| | |
Mondelez International, Inc. |
| | |
| | |
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
PeaceHealth Obligated Group |
| | |
Pepsico Singapore Financing I Pte. Ltd. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Pfizer Investment Enterprises Pte. Ltd. |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
Philip Morris International, Inc. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Providence St. Joseph Health Obligated Group |
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
104
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Shire Acquisitions Investments Ireland DAC |
| | |
|
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Takeda Pharmaceutical Co. Ltd. |
| | |
Thermo Fisher Scientific, Inc. |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
Universal Health Services, Inc. |
| | |
|
| | |
Utah Acquisition Sub, Inc. |
| | |
|
| | |
|
| | |
Zimmer Biomet Holdings, Inc. |
| | |
|
| | |
| | |
| | |
|
|
| | |
|
| | |
Baker Hughes Holdings LLC/Baker Hughes Co-Obligor, Inc. |
| | |
| | |
|
| | |
| | |
BP Capital Markets America, Inc. |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Canadian Natural Resources Ltd. |
| | |
|
| | |
Cheniere Corpus Christi Holdings LLC |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
Continental Resources, Inc. |
| | |
|
| | |
| | |
DCP Midstream Operating LP |
| | |
|
| | |
|
| | |
Enbridge Energy Partners LP |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
EnLink Midstream Partners LP |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
105
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Enterprise Products Operating LLC |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
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| | |
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|
| | |
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| | |
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| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
Occidental Petroleum Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Patterson-UTI Energy, Inc. |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
|
| | |
| | |
| | |
Pioneer Natural Resources Co. |
| | |
| | |
Plains All American Pipeline LP/PAA Finance Corp. |
| | |
| | |
Sabine Pass Liquefaction LLC |
| | |
| | |
| | |
Schlumberger Finance Canada Ltd. |
| | |
Shell International Finance BV |
| | |
| | |
Spectra Energy Partners LP |
| | |
|
| | |
| | |
Targa Resources Partners LP/Targa Resources Partners Finance Corp. |
| | |
|
| | |
Tennessee Gas Pipeline Co. LLC |
| | |
TotalEnergies Capital International SA |
| | |
|
| | |
TransCanada PipeLines Ltd. |
| | |
| | |
Transcontinental Gas Pipe Line Co. LLC |
| | |
| | |
|
| | |
| | |
Valero Energy Partners LP |
| | |
Western Midstream Operating LP |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
|
| | |
106
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
Jacobs Engineering Group, Inc. |
| | |
|
| | |
| | |
|
|
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
Automatic Data Processing, Inc. |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
Broadcom Corp./Broadcom Cayman Finance Ltd. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Broadridge Financial Solutions, Inc. |
| | |
CDW LLC/CDW Finance Corp. |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
Dell International LLC/EMC Corp. |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
FactSet Research Systems, Inc. |
| | |
Fidelity National Information Services, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
Genpact Luxembourg SARL/Genpact USA, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
Hewlett Packard Enterprise Co. |
| | |
| | |
| | |
|
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
107
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
IBM International Capital Pte. Ltd. |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
International Business Machines Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
Keysight Technologies, Inc. |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
Microchip Technology, Inc. |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
|
| | |
|
| | |
|
| | |
| | |
|
| | |
NXP BV/NXP Funding LLC/NXP USA, Inc. |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
Tyco Electronics Group SA |
| | |
| | |
108
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
|
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
| | |
| | |
|
American Airlines 2016-1 Class AA Pass-Through Trust |
| | |
American Airlines 2016-2 Class AA Pass-Through Trust |
| | |
American Airlines 2017-1 Class AA Pass-Through Trust |
| | |
American Airlines Pass-Through Trust |
| | |
|
| | |
Burlington Northern Santa Fe LLC |
| | |
Canadian National Railway Co. |
| | |
Canadian Pacific Railway Co. |
| | |
| | |
CH Robinson Worldwide, Inc. |
| | |
|
| | |
| | |
| | |
Delta Air Lines 2020-1 Class AA Pass-Through Trust |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
| | |
JB Hunt Transport Services, Inc. |
| | |
|
| | |
|
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
| | |
United Airlines 2014-1 Class A Pass-Through Trust |
| | |
United Airlines 2014-2 Class A Pass-Through Trust |
| | |
United Airlines 2016-1 Class AA Pass-Through Trust |
| | |
United Airlines 2020-1 Class A Pass-Through Trust |
| | |
United Parcel Service, Inc. |
| | |
| | |
| | |
| | |
|
|
|
|
| | |
| | |
|
| | |
| | |
|
| | |
Algonquin Power & Utilities Corp. |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
American Electric Power Co., Inc. |
| | |
| | |
| | |
| | |
Arizona Public Service Co. |
| | |
|
| | |
Baltimore Gas & Electric Co. |
| | |
Berkshire Hathaway Energy Co. |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
109
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
CenterPoint Energy Houston Electric LLC |
| | |
|
| | |
| | |
Cleco Corporate Holdings LLC |
| | |
|
| | |
| | |
|
| | |
| | |
Connecticut Light & Power Co. |
| | |
Consolidated Edison Co. of New York, Inc. |
| | |
| | |
Constellation Energy Generation LLC |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
| | |
| | |
| | |
Duke Energy Carolinas LLC |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
|
| | |
SECURITY RATE, MATURITY DATE | | |
|
| | |
|
| | |
|
| | |
| | |
| | |
|
| | |
Evergy Kansas Central, Inc. |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
| | |
Florida Power & Light Co. |
| | |
| | |
| | |
| | |
|
| | |
|
| | |
| | |
Indiana Michigan Power Co. |
| | |
Interstate Power & Light Co. |
| | |
| | |
|
| | |
|
| | |
|
| | |
National Rural Utilities Cooperative Finance Corp. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
NextEra Energy Capital Holdings, Inc. |
| | |
| | |
| | |
| | |
| | |
110
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
|
| | |
Oncor Electric Delivery Co. LLC |
| | |
| | |
| | |
Pacific Gas & Electric Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
PPL Capital Funding, Inc. |
| | |
Public Service Electric & Gas Co. |
| | |
| | |
| | |
Public Service Enterprise Group, Inc. |
| | |
| | |
| | |
|
| | |
San Diego Gas & Electric Co. |
| | |
| | |
|
| | |
Southern California Edison Co. |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
Southwestern Electric Power Co. |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
System Energy Resources, Inc. |
| | |
|
| | |
|
| | |
Virginia Electric & Power Co. |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
|
|
| | |
CenterPoint Energy Resources Corp. |
| | |
|
| | |
| | |
| | |
|
| | |
Piedmont Natural Gas Co., Inc. |
| | |
|
| | |
| | |
| | |
Southern California Gas Co. |
| | |
| | |
Southern Co. Gas Capital Corp. |
| | |
|
| | |
| | |
| | |
|
American Water Capital Corp. |
| | |
| | |
Essential Utilities, Inc. |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
111
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
Total Corporates
(Cost $374,324,818) | |
|
TREASURIES 67.5% OF NET ASSETS |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
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| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
112
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Total Treasuries
(Cost $993,937,391) | |
|
GOVERNMENT RELATED 6.4% OF NET ASSETS |
|
|
|
|
Oesterreichische Kontrollbank AG |
| | |
| | |
| | |
| | |
| | |
| | |
|
Export Development Canada |
| | |
| | |
| | |
| | |
| | |
|
Kreditanstalt fuer Wiederaufbau |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
Landwirtschaftliche Rentenbank |
| | |
| | |
| | |
| | |
| | |
|
Japan Bank for International Cooperation |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Japan International Cooperation Agency |
| | |
| | |
| | |
| | |
|
|
| | |
|
Export-Import Bank of Korea |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
|
|
| | |
| | |
| | |
| | |
| | |
|
Federal Farm Credit Banks Funding Corp. | | |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
113
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Federal Home Loan Mortgage Corp. | | |
| | |
Federal National Mortgage Association | | |
| | |
| | |
| | |
| | |
| | |
|
|
|
|
|
| | |
Province of British Columbia |
| | |
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
|
| | |
| | |
|
| | |
| | |
California Earthquake Authority | | |
| | |
| | |
Metropolitan Government Nashville & Davidson County Health & Educational Facs Board | | |
RB (Vanderbilt Univ Medical Center) Series 2016 B | | |
| | |
New Jersey Economic Development Authority | | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
New Jersey Transportation Trust Fund Authority | | |
RB (Build America Bonds) Series 2010C | | |
| | |
| | |
GO Bonds (Pension Funding) Series 2003 | | |
| | |
Oregon School Boards Association | | |
| | |
| | |
State Board of Administration Finance Corp. | | |
| | |
| | |
| | |
| | |
State Public School Building Authority | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
|
Canada Government International Bonds |
| | |
| | |
| | |
| | |
|
Chile Government International Bonds |
| | |
| | |
| | |
| | |
| | |
|
Indonesia Government International Bonds |
| | |
| | |
| | |
| | |
| | |
|
Israel Government International Bonds |
| | |
|
Republic of Italy Government International Bonds |
| | |
114
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
Mexico Government International Bonds |
| | |
| | |
| | |
| | |
| | |
| | |
|
Panama Government International Bonds |
| | |
| | |
| | |
| | |
|
Peru Government International Bonds |
| | |
|
Philippines Government International Bonds |
| | |
| | |
| | |
| | |
|
Republic of Poland Government International Bonds |
| | |
| | |
| | |
| | |
|
Korea International Bonds |
| | |
|
Uruguay Government International Bonds |
| | |
| | |
|
|
|
| | |
| | |
| | |
| | |
| | |
Arab Petroleum Investments Corp. |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
SECURITY RATE, MATURITY DATE | | |
| | |
| | |
| | |
| | |
Asian Infrastructure Investment Bank |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
Council of Europe Development Bank |
| | |
| | |
Council Of Europe Development Bank |
| | |
European Bank for Reconstruction & Development |
| | |
| | |
| | |
| | |
|
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Inter-American Development Bank |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
Inter-American Investment Corp. |
| | |
International Bank for Reconstruction & Development |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
International Finance Corp. |
| | |
| | |
| | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
115
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | |
|
| | |
| | |
| | |
| | |
Total Government Related
(Cost $96,260,180) | |
| | |
Short-Term Investments 0.9% OF NET ASSETS |
|
|
State Street Institutional U.S. Government Money Market Fund, Premier Class 5.24% (j) | | |
State Street Institutional U.S. Government Money Market Fund, Premier Class 5.24% (j)(k) | | |
| | |
Total Short-Term Investments
(Cost $12,557,242) | |
Total Investments in Securities
(Cost $1,477,079,631) | |
| Supranational bonds represent the debt of international organizations or institutions such as the World Bank, the International Monetary Fund, regional multilateral development banks and others. |
| All or a portion of this security is on loan. Securities on loan were valued at $1,522,890. |
| The effective maturity may be shorter than the final maturity shown because of the possibility of interim principal payments and prepayments or as the result of embedded demand features (puts or calls). |
| Security is in a fixed-rate coupon period. Based on index eligibility requirements and the fund’s investment objective this security will be removed from the index prior to converting to a floating rate security. |
| Securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registrations, normally to qualified institutional buyers. At the period end, the value of these amounted to $2,845,066 or 0.2% of net assets. |
| Issuer is affiliated with the fund’s investment adviser. |
| Interest rate is subject to adjustments from time to time if a nationally recognized statistical rating organization downgrades (or subsequently upgrades) the debt rating assigned to the bond. |
| Step up bond that pays an initial coupon rate for a set period and increased coupon rates at one or more preset intervals. Rate shown is as of period end. |
| Security or a portion of the security purchased on a delayed-delivery or when-issued basis. |
| Guaranteed by the Republic of Germany. |
| The rate shown is the annualized 7-day yield. |
| Security purchased with cash collateral received for securities on loan. |
| |
| |
| Real Estate Investment Trust |
Below is a summary of the fund’s transactions with affiliated issuers during the period ended August 31, 2024:
SECURITY
RATE, MATURITY DATE | | | | | NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | ACCRETION OF DISCOUNTS (AMORTIZATION OF PREMIUMS) | | | |
CORPORATES 0.1% OF NET ASSETS |
|
Financial Institutions 0.1% |
Brokerage/Asset Managers/Exchanges 0.1% |
|
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
116
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Portfolio Holdings as of August 31, 2024 (continued)
SECURITY RATE, MATURITY DATE | | | | | NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | ACCRETION OF DISCOUNTS (AMORTIZATION OF PREMIUMS) | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
The following is a summary of the inputs used to value the fund’s investments as of August 31, 2024 (see financial note 2(a) for additional information):
| QUOTED PRICES IN
ACTIVE MARKETS FOR
IDENTICAL ASSETS
(LEVEL 1) | OTHER SIGNIFICANT
OBSERVABLE INPUTS
(LEVEL 2) | SIGNIFICANT
UNOBSERVABLE INPUTS
(LEVEL 3) | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| As categorized in the Portfolio Holdings. |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
117
Schwab Short-Term Bond Index Fund
Statement of Assets and Liabilities
|
Investments in securities, at value - affiliated issuers (cost $1,499,291) | | |
Investments in securities, at value - unaffiliated issuers (cost $1,475,580,340) including securities on loan of $1,522,890 | | |
| | |
| | |
| | |
| | |
| | |
Income from securities on loan | | |
| | |
|
|
Collateral held for securities on loan | | |
| | |
| | |
| | |
Distributions to shareholders | | |
Investments bought - delayed-delivery | | |
| | |
| | |
| | |
|
|
Capital received from investors | | |
| | |
| | |
118
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Short-Term Bond Index Fund
Statement of Operations
For the period September 1, 2023 through August 31, 2024 |
|
Interest received from securities - unaffiliated issuers | | |
Dividends received from securities - unaffiliated issuers | | |
Interest received from securities - affiliated issuers | | |
| | |
| | |
|
|
| | |
| | |
| | |
|
REALIZED AND UNREALIZED GAINS (LOSSES) |
Net realized losses on sales of securities - affiliated issuers | | |
Net realized losses on sales of securities - unaffiliated issuers | | |
| | |
Net change in unrealized appreciation (depreciation) on securities - affiliated issuers | | |
Net change in unrealized appreciation (depreciation) on securities - unaffiliated issuers | | |
Net change in unrealized appreciation (depreciation) | | |
Net realized and unrealized gains | | |
Increase in net assets resulting from operations | | |
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
119
Schwab Short-Term Bond Index Fund
Statement of Changes in Net Assets
For the current and prior report periods
|
| | |
| | | |
| | | |
Net change in unrealized appreciation (depreciation) | | | |
Increase in net assets resulting from operations | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS |
| | | |
TRANSACTIONS IN FUND SHARES |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Net transactions in fund shares | | | | | |
|
SHARES OUTSTANDING AND NET ASSETS |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
120
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Taxable Bond Funds
1. Business Structure of the Funds:
Each of the funds in this report is a series of Schwab Investments (the trust), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the funds in the trust as of the end of the period, including the funds discussed in this report, which are highlighted:
|
Schwab Treasury Inflation Protected Securities Index Fund | Schwab California Tax-Free Bond Fund |
Schwab U.S. Aggregate Bond Index Fund | Schwab Opportunistic Municipal Bond Fund |
Schwab Short-Term Bond Index Fund | |
Schwab Tax-Free Bond Fund | Schwab Global Real Estate Fund |
Each fund in this report offers one share class. Shares are bought and sold at closing net asset value per share (NAV), which is the price for all outstanding shares of a fund. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the Board) may authorize the issuance of as many shares as necessary.
Each fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, each fund may also keep certain assets in segregated accounts, as required by securities law. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust.
The Schwab Treasury Inflation Protected Securities Index Fund’s goal is to track as closely as possible, before fees and expenses, the total return of an index composed of inflation-protected U.S. Treasury securities.
The Schwab U.S. Aggregate Bond Index Fund’s goal is to track as closely as possible, before fees and expenses, the total return of an index that measures the performance of the broad U.S. investment-grade bond market.
The Schwab Short-Term Bond Index Fund’s goal is to track as closely as possible, before fees and expenses, the total return of an index composed of U.S. investment grade government related and corporate bonds with maturities between 1-5 years.
2. Significant Accounting Policies:The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The funds follow the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 Financial Services — Investment Companies. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).
The funds may invest in mutual funds which are referred to as "underlying funds". For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports and holdings and financial statements, which are filed in Form N-CSR with the U.S. Securities and Exchange Commission (SEC) and are available on the SEC’s website at www.sec.gov.
Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated authority to a Valuation Designee, the funds’ investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities as well as to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.
Securities held in the funds’ portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:
● Bonds and notes: Fixed income investments are generally valued using an evaluated price at the mid-point of the bid/ask spread provided by an approved, independent pricing service (mid-price). To determine the evaluated mid-price, a pricing service may use a variety of techniques and inputs. Techniques may include, but are not limited to, spread models that
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
121
Schwab Taxable Bond Funds
Financial Notes (continued)
2. Significant Accounting Policies (continued):
calculate an investment-specific price relative to a benchmark or yield curve models that establish a price based on yields of comparable bonds along a range of maturities. Inputs differ by valuation approach and techniques, as appropriate, and examples of inputs may include, but are not limited to, interest rates, market conditions, comparable bonds, market trades, projected cash flows, credit reviews and issuer news.
● Short-term securities (60 days or less to maturity): Securities with remaining maturities of 60 days or less are generally valued at an evaluated price; however, such securities may be valued at their amortized cost if it approximates the security’s fair value.
● Mutual funds: Mutual funds are valued at their respective NAVs.
● Securities for which no quoted value is available: The Valuation Designee has adopted procedures to fair value a fund’s securities when market prices are not “readily available” or are unreliable. For example, a security may be fair valued when it’s de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security.
In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee’s judgment will be required to estimate fair value.
The three levels of the fair value hierarchy are as follows:
● Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets. These generally include active listed equities, mutual funds, Exchange-Traded Funds (ETFs) and futures contracts. Mutual funds and ETFs are classified as Level 1 prices, without consideration to the classification level of the underlying securities held which could be Level 1, Level 2 or Level 3 in the fair value hierarchy.
● Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include forward foreign currency exchange contracts, U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations.
● Level 3 — significant unobservable inputs (including the Valuation Designee’s assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore a fund`s results of operations.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The levels associated with valuing the funds’ investments as of August 31, 2024, are disclosed in each fund’s Portfolio Holdings.
122
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Taxable Bond Funds
Financial Notes (continued)
2. Significant Accounting Policies (continued):
(b) Accounting Policies for certain Portfolio Investments (if held):
Inflation-Protected Securities: The Schwab Treasury Inflation Protected Securities Index Fund invests in U.S. Treasury inflation-protected securities (TIPS). Inflation-protected securities are fixed-income securities whose principal value is periodically adjusted to the rate of inflation. The interest rate on these instruments is generally fixed at issuance at a rate lower than typical bonds or notes. Over the life of an inflation-indexed instrument, however, interest will be paid based on a principal value, which is adjusted for any inflation or deflation. Any increase or decrease in the principal amount of an inflation-protected security will be included as an addition or reduction to interest income in the fund’s Statement of Operations, even though investors do not receive their principal until maturity.
TBA Commitments: The funds may enter into “TBA” (to-be-announced) commitments to purchase or sell securities for a fixed price at a future date. Payments or proceeds of TBA commitments are not delivered until the contractual settlement date. Unsettled TBA commitments are valued at the current fair value generally according to the procedures described above in the Security Valuation section. The funds’ use of TBA commitments may cause the funds to experience higher portfolio turnover and higher transaction costs.
Agency MBS and TBA Transactions: The Treasury Market Practices Group (TMPG) of the Federal Reserve Bank of New York recommended the margining of certain forward-settling Agency MBS (Mortgage-Backed Securities) transactions, including TBAs, to reduce counterparty credit risk. The TMPG recommended market participants exchange two-way variation margin on a regular basis. The Schwab U.S. Aggregate Bond Index Fund posts and receives variation margin with certain counterparties in instances where the unrealized gain (loss) on such transactions exceeds certain pre-determined thresholds. The variation margin, if any, is disclosed in the Statement of Assets and Liabilities.
Delayed-Delivery Transactions and When-Issued Securities: The funds may transact in securities on a delayed-delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The securities purchased on a delayed-delivery or when-issued basis are identified as such in the funds’ Portfolio Holdings, if any. The funds may receive compensation for interest forgone in the purchase of a delayed-delivery or when-issued security. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract’s terms, or if the issuer does not issue the securities due to political, economic, or other factors. The funds comply with Rule 18f-4 under the 1940 Act, the funds operate as limited derivatives users, with respect to purchase commitments held within the funds, portfolio securities are no longer required to be segregated as collateral with a value at least equal to the amount of a purchase commitment and the funds’ exposure is monitored under a derivatives risk management program.
Securities Lending: Under the trust’s Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to be maintained on a daily marked-to-market basis in an amount at least equal to the current value of the securities loaned. The lending agent provides a fund with indemnification against borrower default (the borrower fails to return the security on loan) reducing the risk of loss as a result of default. The cash collateral of securities loaned is currently invested in money market portfolios operating pursuant to Rule 2a-7 under the 1940 Act. Each fund bears the risk of loss with respect to the investment of cash collateral. The terms of the securities lending agreement allow the funds or the lending agent to terminate any loan at any given time and the securities must be returned within the earlier of the standard trade settlement period or the specified time period under the relevant securities lending agreement. Securities lending income, as disclosed in each fund’s Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent and broker rebates which are subject to adjustments pursuant to the securities lending agreement. On loans not collateralized by cash, a fee is received from the borrower, and is allocated between a fund and the lending agent. The aggregate fair value of securities loaned will not at any time exceed one-third of the total assets of a fund, including collateral received from the loan. Securities lending fees paid to the unaffiliated lending agents start at 9% of gross lending revenue, with subsequent breakpoints to a low of 5%. In this context, the gross lending revenue equals the income received from the investment of cash collateral and fees paid by borrowers less any rebates paid to the borrowers. Any expenses charged by the cash collateral fund are in addition to these fees. All remaining revenue is retained by the fund, as applicable. No portion of lending revenue is paid to or retained by the investment adviser or any of its affiliates.
As of August 31, 2024, the Schwab U.S. Aggregate Bond Index Fund and Schwab Short-Term Bond Index Fund had securities on loan, all of which were classified as corporate bonds. The value of the securities on loan and the related collateral as of August 31, 2024, are disclosed in each fund’s Portfolio Holdings and Statement of Assets and Liabilities.
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Financial Notes (continued)
2. Significant Accounting Policies (continued):
(c) Security Transactions:
Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved. Gains and losses from paydowns on mortgage and asset backed securities are recorded as adjustments to interest income.
Interest income is recorded as it accrues. If a fund buys a debt security at a discount (less than face value) or a premium (more than face value), it amortizes premiums and accretes discounts from the purchase settlement date up to maturity. The fund then increases (in the case of discounts) or reduces (in the case of premiums) the income it records from the security. Certain securities may be callable (meaning that the issuer has the option to pay it off before its maturity date). The fund amortizes the premium and accretes the discount on each callable security to the security’s maturity date, except when the purchase price is higher than the call price at the security’s call date (in which case the premium is amortized to the call date). Any increase or decrease in the principal amount of an inflation-protected security is included as an addition or reduction to interest income in the Statement of Operations; such adjustments may have a significant impact on a fund’s distributions. Dividends and distributions from underlying funds are recorded on the date they are effective (the ex-dividend date). Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.
Pursuant to an Amended and Restated Investment Advisory Agreement between the investment adviser and the Schwab Treasury Inflation Protected Securities Index Fund and an Investment Advisory Agreement between the investment adviser and the Schwab U.S. Aggregate Bond Index Fund and Schwab Short-Term Bond Index Fund, the investment adviser pays the operating expenses of the funds, excluding acquired fund fees and expenses, taxes, any brokerage expenses, and extraordinary or non-routine expenses. Taxes, any brokerage expenses and extraordinary or non-routine expenses that are specific to a fund are charged directly to the fund. Acquired fund fees and expenses are indirect expenses incurred by a fund through its investments in underlying funds.
(f) U.S. Treasury, Agency Debt & Agency MBS Charges:
Due to market conditions or other reasons, delivery of U.S. Treasury securities, agency debt and agency MBS may not occur on a timely basis. In these instances, a fund may fail to receive a security purchased causing the fund to be unable to deliver a security sold. The TMPG recommends voluntary fail charges when securities are not delivered as agreed by the parties. These fail charges are included in net realized gains (losses) on sales of securities on each fund’s Statement of Operations, if any.
(g) Distributions to Shareholders:
The funds, except for the Schwab Treasury Inflation Protected Securities Index Fund, declare distributions from net investment income, if any, every day they are open for business. These distributions, which are substantially equal to a fund’s net investment income for that day, are paid out to shareholders once a month. The Schwab Treasury Inflation Protected Securities Index Fund declares and pays distributions from net investment income, if any, quarterly. All the funds make distributions from net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.
(h) Accounting Estimates:
The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It’s possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.
(i) Federal Income Taxes:
The funds intend to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the funds distribute substantially all of their net investment income and net realized capital gains, if any, to their respective shareholders each year. As long as a fund meets the tax requirements, it is not required to pay federal income tax.
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Financial Notes (continued)
2. Significant Accounting Policies (continued):
(j) Indemnification:
Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.
The funds invest mainly in corporate bonds, mortgage-backed and asset-backed securities, government or municipal obligations, and other debt securities. These investments may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below:
Market Risk. Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics, may also negatively affect the financial markets. As with any investment whose performance is tied to these markets, the value of an investment in a fund will fluctuate, which means that an investor could lose money over short or long periods.
Investment Style Risk. The funds are index funds. Therefore, they follow the securities included in their respective index during upturns as well as downturns. Because of their indexing strategies, the funds do not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of a fund’s expenses, the fund’s performance may be below that of its index. Errors relating to an index may occur from time to time and may not be identified by the index provider for a period of time. In addition, market disruptions could cause delays in the index’s rebalancing schedule. Such errors and/or market disruptions may result in losses for the fund.
Interest Rate Risk. Interest rates rise and fall over time. As with any investment whose yield reflects current interest rates, a fund’s yield will change over time. During periods when interest rates are low, a fund’s yield (and total return) also may be low. Changes in interest rates also may affect a fund’s share price: a rise in interest rates generally causes a fund’s share price to fall. The longer a fund’s portfolio duration, the more sensitive to interest rate movements its share price is likely to be. Also, a change in a central bank’s monetary policy or economic conditions, among other things, may result in a change in interest rates, which could have sudden and unpredictable effects on the markets and significantly impact the value of fixed-income securities in which a fund invests. A sudden or unpredictable rise in interest rates may cause volatility and the value of fixed-income securities to decline.
Credit Risk. A decline in the credit quality of an issuer, guarantor or liquidity provider of a portfolio investment or a counterparty could cause the funds to lose money or underperform. The funds could lose money if, due to a decline in credit quality, the issuer, guarantor or liquidity provider of a portfolio investment or a counterparty fails to make, or is perceived as being unable or unwilling to make, timely principal or interest payments or otherwise honor its obligations.
Sampling Index Tracking Risk. An index fund may not fully replicate its respective index and may hold securities not included in the respective index. As a result, a fund is subject to the risk that the investment adviser’s investment management strategy, the implementation of which is subject to a number of constraints, may not produce the intended results. If a fund utilizes a sampling approach it may not track the return of the index as well as it would if a fund purchased all of the securities in the index.
Tracking Error Risk. As index funds, each fund seeks to track the performance of its respective index, although it may not be successful in doing so. The divergence between the performance of a fund and the index, positive or negative, is called “tracking error.” Tracking error can be caused by many factors and it may be significant.
Portfolio Turnover Risk. (Schwab U.S. Aggregate Bond Index Fund only). The fund may engage in frequent trading of its portfolio securities in connection with its tracking of the index, primarily due to the fund rolling over its positions in TBAs as it tracks the portion of the index represented by mortgage-backed securities. A higher portfolio turnover rate may result in increased transaction costs, which may lower the fund’s performance. A higher portfolio turnover rate can also result in an increase in taxable capital gains distributions to the fund’s shareholders.
Liquidity Risk. The funds may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the funds may have to sell them at a loss.
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Financial Notes (continued)
3. Risk Factors (continued):
Concentration Risk. To the extent that a fund’s or an index’s portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector or asset class, a fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more vulnerable to adverse economic, market, political or regulatory occurrences affecting that market, industry, group of industries, sector or asset class.
Prepayment and Extension Risk. Certain fixed-income securities are subject to the risk that the securities may be paid off earlier or later than expected, especially during periods of falling or rising interest rates, respectively. Prepayments of obligations could cause a fund to forgo future interest income on the portion of the security’s principal repaid early and force a fund to reinvest that money at the lower prevailing interest rates. Extensions of obligations could cause a fund to exhibit additional volatility and hold securities paying lower-than-market rates of interest. Either case could hurt a fund’s performance.
Non-U.S. Issuer Risk. Certain funds may invest in U.S.-registered, dollar-denominated bonds of non-U.S. corporations, governments, agencies and supra-national entities. A fund’s investments in bonds of non-U.S. issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; the imposition of economic sanctions or other government restrictions; differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may be heightened in connection with bonds issued by non-U.S. corporations and entities in emerging markets.
Derivatives Risk. Certain funds may invest in derivative instruments. The principal types of derivatives used by the funds are futures contracts. A futures contract is an agreement to buy or sell a financial instrument at a specific price on a specific day. A fund’s use of derivatives that are subject to regulation by the Commodity Futures Trading Commission (CFTC) could cause a fund to become a commodity pool, which would require the fund to comply with certain CFTC rules.
A fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Certain of these risks, such as market risk, credit risk, liquidity risk and leverage risk, are discussed elsewhere in this section. A fund’s use of derivatives is also subject to lack of availability risk, valuation risk, correlation risk and tax risk. Lack of availability risk is the risk that suitable derivative transactions may not be available in all circumstances for risk management or other purposes. Valuation risk is the risk that a particular derivative may be valued incorrectly. Correlation risk is the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate or index. Tax risk is the risk that the use of derivatives may cause a fund to realize higher amounts of short-term capital gains. A fund’s use of derivatives could reduce the fund’s performance, increase the fund’s volatility, and cause the fund to lose more than the initial amount invested. A fund’s use of derivatives also could create a risk of counterparty default under certain transactions, risks that the fund would need to liquidate portfolio positions when it may not be advantageous to do so in order to meet margin and payment obligations, and legal risks relating to insufficient documentation, insufficient capacity or authority of a counterparty, or legality or enforceability of a contract.
Mortgage-Backed and Mortgage Pass-Through Securities Risk. Mortgage-backed securities tend to increase in value less than other debt securities when interest rates decline, but are subject to similar or greater risk of decline in fair value during periods of rising interest rates. Certain of the mortgage-backed securities in which a fund may invest are issued or guaranteed by agencies or instrumentalities of the U.S. government but are not backed by the full faith and credit of the U.S. government. There can be no assurance that the U.S. government would provide financial support to its agencies or instrumentalities where it was not obligated to do so which can cause a fund to lose money or underperform. The risks of investing in mortgage-backed securities include, among others, interest rate risk, credit risk, prepayment risk and extension risk. Transactions in mortgage pass-through securities often occur through TBA transactions. A fund could lose money or underperform if a TBA counterparty defaults or goes bankrupt.
Mortgage Dollar Rolls Risk. Mortgage dollar rolls are transactions in which a fund sells mortgage-backed securities to a dealer and simultaneously agrees to repurchase similar securities in the future at a predetermined price. A fund’s mortgage dollar rolls could lose money if the price of the mortgage-backed securities sold falls below the agreed upon repurchase price, or if the counterparty is unable to honor the agreement.
Securities Lending Risk. Securities lending involves the risk of loss of rights in, or delay in recovery of, the loaned securities if the borrower fails to return the security loaned or becomes insolvent.
Inflation-Protected Security Risk. The value of inflation-protected securities, including TIPS, generally will fluctuate in response to changes in “real” interest rates, generally decreasing when real interest rates rise and increasing when real interest rates fall. Real interest rates represent nominal (or stated) interest rates reduced by the expected impact of inflation. In addition, interest payments on inflation-indexed securities will generally vary up or down along with the rate of inflation.
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Financial Notes (continued)
3. Risk Factors (continued):
Leverage Risk. Certain fund transactions, such as derivatives transactions, TBA transactions and mortgage dollar rolls, may give rise to a form of leverage and may expose the funds to greater risk. Leverage tends to magnify the effect of any decrease or increase in the value of a fund’s portfolio securities. The use of leverage may cause a fund to liquidate portfolio positions when it would not be advantageous to do so in order to satisfy its obligations.
Money Market Fund Risk. The funds may invest in underlying money market funds that either seek to maintain a stable $1.00 net asset value (“stable share price money market funds”) or that have a share price that fluctuates (“variable share price money market funds”). Although an underlying stable share price money market fund seeks to maintain a stable $1.00 net asset value, it is possible to lose money by investing in such a money market fund. Because the share price of an underlying variable share price money market fund will fluctuate, when a fund sells the shares it owns they may be worth more or less than what the fund originally paid for them. In addition, neither type of money market fund is designed to offer capital appreciation. Certain underlying money market funds may impose a fee upon the sale of shares or may temporarily suspend the ability to sell shares if such fund’s liquidity falls below required minimums.
Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.
4. Affiliates and Affiliated Transactions:Charles Schwab Investment Management Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement between the investment adviser and the trust.
For its advisory and administrative services to the funds, the investment adviser is entitled to receive an annual fee, payable monthly, based on each fund’s average daily net assets as follows:
SCHWAB TREASURY INFLATION PROTECTED SECURITIES INDEX FUND | SCHWAB U.S. AGGREGATE BOND INDEX FUND | SCHWAB SHORT-TERM BOND INDEX FUND |
| | |
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Financial Notes (continued)
4. Affiliates and Affiliated Transactions (continued):
Investments from Affiliates
Certain funds in the Fund Complex may own shares of other funds in the Fund Complex. The table below reflects the percentage of shares of each fund in this report that are owned by other funds in the Fund Complex as of August 31, 2024, as applicable:
| |
| SCHWAB TREASURY INFLATION PROTECTED SECURITIES INDEX FUND | SCHWAB U.S. AGGREGATE BOND INDEX FUND | SCHWAB SHORT-TERM BOND INDEX FUND |
| | | |
Schwab MarketTrack Balanced Portfolio | | | |
Schwab MarketTrack Conservative Portfolio | | | |
Schwab MarketTrack Growth Portfolio | | | |
Schwab Monthly Income Fund - Flexible Payout | | | |
Schwab Monthly Income Fund - Income Payout | | | |
Schwab Monthly Income Fund - Target Payout | | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
Interfund Borrowing and Lending
Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other funds in the Fund Complex. All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.
The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The funds did not pay any interested persons or non-interested persons (independent trustees). The independent trustees are paid by the investment adviser.
During the period, the funds were participants with other funds in the Fund Complex in a joint, syndicated, committed $1 billion line of credit (the Syndicated Credit Facility), which matured on September 28, 2023. On September 28, 2023, the Syndicated Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on
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Financial Notes (continued)
6. Borrowing from Banks (continued):
September 26, 2024. Under the terms of the Syndicated Credit Facility, in addition to the investment adviser paying the interest charged on any borrowings by a fund, the investment adviser paid a commitment fee of 0.15% per annum on the funds’ proportionate share of the unused portion of the Syndicated Credit Facility.
During the period, the funds were participants with other funds in the Fund Complex in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street Bank and Trust Company, which matured on September 28, 2023. On September 28, 2023, the Uncommitted Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 26, 2024. Under the terms of the Uncommitted Credit Facility, the investment adviser pays interest on the amount a fund borrows. There were no borrowings from either line of credit during the period.
The funds also have access to custodian overdraft facilities. A fund may have utilized the overdraft facility and incurred an interest expense, which is paid by the investment adviser. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.
Certain funds entered into futures contracts during the report period to manage the effects of interest rate changes. Refer to financial note 2(b) for the funds’ accounting policies with respect to futures contracts and financial note 3 for disclosures concerning the risks of investing in futures contracts.
The effects of the derivative contracts held in the Statement of Operations for the period ended August 31, 2024, if any, were:
| | |
Net Realized Gains (Losses) | | |
Schwab U.S. Aggregate Bond Index Fund | | |
| | |
| |
| Statement of Operations location: Net realized gains (losses) on futures contracts. |
During the period ended August 31, 2024, the month-end average notional amounts of futures contracts held by the funds and the month-end average number of contracts held were as follows:
| | |
Schwab Treasury Inflation Protected Securities Index Fund | | |
Schwab U.S. Aggregate Bond Index Fund | | |
Schwab Short-Term Bond Index Fund | | |
| During the period, the fund did not hold futures contracts at any month-end. The average value and number of contracts were calculated by aggregating the highest daily values held each month during the period. |
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Financial Notes (continued)
8. Purchases and Sales/Maturities of Investment Securities:
For the period ended August 31, 2024, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:
| PURCHASES OF LONG-TERM
U.S. GOVERNMENT
SECURITIES* | PURCHASES OF OTHER
LONG-TERM SECURITIES | TOTAL PURCHASES OF
LONG-TERM SECURITIES |
Schwab Treasury Inflation Protected Securities Index Fund | | | |
Schwab U.S. Aggregate Bond Index Fund | | | |
Schwab Short-Term Bond Index Fund | | | |
| SALES/MATURITIES OF
LONG-TERM U.S. GOVERNMENT
SECURITIES* | SALES/MATURITIES OF
OTHER LONG-TERM SECURITIES | TOTAL SALES/MATURITIES OF
LONG-TERM SECURITIES |
Schwab Treasury Inflation Protected Securities Index Fund | | | |
Schwab U.S. Aggregate Bond Index Fund | | | |
Schwab Short-Term Bond Index Fund | | | |
*
Includes securities guaranteed by U.S. Government Agencies.
As of August 31, 2024, the tax basis cost of the funds’ investments and gross unrealized appreciation and depreciation were as follows:
| | GROSS UNREALIZED
APPRECIATION | GROSS UNREALIZED
DEPRECIATION | NET UNREALIZED
APPRECIATION
(DEPRECIATION) |
Schwab Treasury Inflation Protected Securities Index Fund | | | | |
Schwab U.S. Aggregate Bond Index Fund | | | | |
Schwab Short-Term Bond Index Fund | | | | |
The primary difference between book basis and tax basis unrealized appreciation or unrealized depreciation of investments is the tax deferral of losses on wash sales. The tax cost of the funds’ investments, disclosed above, have been adjusted from their book amounts to reflect these unrealized appreciation or depreciation differences, as applicable.
As of August 31, 2024, the components of distributable earnings on a tax basis were as follows:
| UNDISTRIBUTED
ORDINARY
INCOME | NET UNREALIZED
APPRECIATION
(DEPRECIATION)
ON INVESTMENTS | CAPITAL LOSS
CARRYFORWARDS
AND OTHER LOSSES | |
Schwab Treasury Inflation Protected Securities Index Fund | | | | |
Schwab U.S. Aggregate Bond Index Fund | | | | |
Schwab Short-Term Bond Index Fund | | | | |
The components of distributable earnings on a tax basis may not match the Total distributable earnings line item on the Statement of Assets and Liabilities due to other temporary timing differences.
Net investment income and realized capital gains and losses may differ for financial statement and tax purposes primarily due to differing treatments of paydown gains and losses and sales on TIPS.
Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of August 31, 2024, the funds had capital loss carryforwards available as follows:
| |
Schwab Treasury Inflation Protected Securities Index Fund | |
Schwab U.S. Aggregate Bond Index Fund | |
Schwab Short-Term Bond Index Fund | |
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Financial Notes (continued)
9. Federal Income Taxes (continued):
The tax basis components of distributions paid during the current and prior fiscal years were as follows:
| CURRENT FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS |
| | | |
Schwab Treasury Inflation Protected Securities Index Fund | | | |
Schwab U.S. Aggregate Bond Index Fund | | | |
Schwab Short-Term Bond Index Fund | | | |
Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts in the financial statements. The funds may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes.
Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments will have no impact on net assets or the results of operations.
As of August 31, 2024, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the fiscal year ended August 31, 2024, the funds did not incur any interest or penalties.
Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.
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Report of Independent Registered Public Accounting Firm
To the Board of Trustees of Schwab Investments and Shareholders of Schwab Treasury Inflation Protected Securities Index Fund, Schwab U.S. Aggregate Bond Index Fund, and Schwab Short-Term Bond Index Fund:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statements of assets and liabilities, including the portfolio holdings, of Schwab Treasury Inflation Protected Securities Index Fund, Schwab U.S. Aggregate Bond Index Fund, and Schwab Short-Term Bond Index Fund (the “Funds”), three of the funds constituting Schwab Investments, as of August 31, 2024, the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of each of the Funds as of August 31, 2024, and the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended in conformity with accounting principles generally accepted in the United States of America.
These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of August 31, 2024, by correspondence with the custodian and brokers. We believe that our audits provide a reasonable basis for our opinion.
Deloitte & Touche LLP
Denver, Colorado
October 17, 2024
We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.
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Schwab Taxable Bond Funds
Investment Advisory Agreement Approval
The Investment Company Act of 1940, as amended (the 1940 Act), requires that the continuation of a fund’s investment advisory agreement must be specifically approved (1) by the vote of the trustees or by a vote of the shareholders of the fund, and (2) by the vote of a majority of the trustees who are not parties to the investment advisory agreement or “interested persons” of any party thereto (the Independent Trustees), cast in person at a meeting called for the purpose of voting on such approval. In connection with such approvals, the fund’s trustees must request and evaluate, and the investment adviser is required to furnish, such information as may be reasonably necessary to evaluate the terms of the investment advisory agreement.
The Board of Trustees (the Board or the Trustees, as appropriate) calls and holds one or more meetings each year that are dedicated, in whole or in part, to considering whether to renew the investment advisory and administration agreement (the Agreement) between Schwab Investments (the Trust) and Charles Schwab Investment Management, Inc. (CSIM) (dba Schwab Asset Management) (the investment adviser) with respect to the existing funds in the Trust, including Schwab Treasury Inflation Protected Securities Index Fund, Schwab U.S. Aggregate Bond Index Fund and Schwab Short-Term Bond Index Fund (the Funds), and to review certain other agreements pursuant to which the investment adviser provides investment advisory services to certain other registered investment companies. In preparation for the meeting(s), the Board requests and reviews a wide variety of materials provided by the investment adviser, including information about the investment adviser’s affiliates, personnel, business goals and priorities, profitability, third-party oversight, corporate structure and operations. As part of the renewal process, the Independent Trustees’ legal counsel, on behalf of the Independent Trustees, sends an information request letter to the investment adviser seeking certain relevant information. The responses by the investment adviser are provided to the Trustees in the Board materials for their review prior to their meeting, and the Trustees are provided with the opportunity to request any additional materials. The Board also receives data provided by an independent provider of investment company data. This information is in addition to the detailed information about the Funds that the Board reviews during the course of each year, including information that relates to the Funds’ operations and performance, legal and compliance matters, risk management, portfolio turnover, and sales and marketing activity. In considering the renewal, the Independent Trustees receive advice from Independent Trustees’ legal counsel, including a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements. In addition, the Independent Trustees participate in question and answer
sessions with representatives of the investment adviser and meet in executive session outside the presence of Fund management.
The Board, including a majority of the Independent Trustees, considered information specifically relating to the continuance of the Agreement with respect to the Funds at meetings held on May 2, 2024 and June 6, 2024, and approved the renewal of the Agreement with respect to the Funds for an additional one-year term at the meeting on June 6, 2024 called for the purpose of voting on such approval.
The Board’s approval of the continuance of the Agreement with respect to the Funds was based on consideration and evaluation of a variety of specific factors discussed at these meetings and at prior meetings, including:
1.
the nature, extent and quality of the services provided to each Fund under the Agreement, including the resources of the investment adviser and its affiliates dedicated to the Funds;
2.
each Fund’s investment performance and how it compared to that of certain other comparable mutual funds and benchmark data;
3.
each Fund’s expenses and how those expenses compared to those of certain other similar mutual funds;
4.
the profitability of the investment adviser and its affiliates, including Charles Schwab & Co., Inc. (Schwab), with respect to each Fund, including both direct and indirect benefits accruing to the investment adviser and its affiliates; and
5.
the extent to which economies of scale would be realized as each Fund grows and whether fee levels in the Agreement reflect those economies of scale for the benefit of Fund investors.
Nature, Extent and Quality of Services. The Board considered the nature, extent and quality of the services provided by the investment adviser to the Funds and the resources of the investment adviser and its affiliates dedicated to the Funds. In this regard, the Trustees evaluated, among other things, the investment adviser’s experience, track record, compliance program, resources dedicated to hiring and retaining skilled personnel and specialized talent, and information security resources. The Trustees also considered information provided by the investment adviser relating to services and support provided with respect to the Funds’ portfolio management team, portfolio strategy, and internal investment guidelines, as well as trading infrastructure, liquidity management, product design and analysis, shareholder communications, securities valuation, and vendor and risk oversight. The Trustees also considered the investment adviser’s continued investment in its infrastructure, including the investment adviser’s
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
133
Schwab Taxable Bond Funds
technology and use of data, business continuity, cybersecurity, due diligence, risk management processes, and information security programs. The Trustees considered Schwab’s overall financial condition and reputation as a full service brokerage firm, as well as the wide range of products, services and account features that benefit Fund shareholders who are brokerage clients of Schwab. Following such evaluation, the Board concluded, within the context of its full deliberations, that the nature, extent and quality of services provided by the investment adviser to the Funds and the resources of the investment adviser and its affiliates dedicated to the Funds supported renewal of the Agreement with respect to the Funds.
Fund Performance. The Board considered each Fund’s performance in determining whether to renew the Agreement with respect to such Fund. Specifically, the Trustees considered each Fund’s performance relative to a peer category of other mutual funds and applicable indices/benchmarks, in light of portfolio yield and the market environment, as well as in consideration of each Fund’s investment style and strategy. As part of this review, the Trustees considered the composition of the peer category, selection criteria and the reputation of the independent provider of investment company data who prepared the peer category analysis. In evaluating the performance of each Fund, the Trustees considered the risk profile for such Fund and such Fund’s demonstrated performance in tracking its benchmark index. The Trustees noted that the Funds had closely tracked their respective indexes in 2023, with all of the Funds performing in their expected performance ranges. The Trustees further considered the level of Fund performance in the context of their review of Fund expenses and the investment adviser’s profitability discussed below and also noted that the Board and a designated committee of the Board review performance throughout the year. Although the Schwab Short-Term Bond Index Fund had performance that ranked in the fourth quartile of a relevant peer group for more than one performance period considered, the Board noted that the Fund’s performance peer group included actively managed peers and concluded that other factors relevant to performance supported renewal of the Agreement with respect to the Fund including that the underperformance was attributable, to a significant extent, to investment decisions by the investment adviser that were reasonable and consistent with the Fund’s investment objective and policies. Following such evaluation, the Board concluded, within the context of its full deliberations, that the performance of each Fund supported renewal of the Agreement with respect to such Fund.
Fund Expenses. With respect to each Fund’s expenses, the Trustees considered the rate of compensation called for by the Agreement and each Fund’s operating expense ratio, in each case, in comparison to those of other similar mutual funds, such peer groups and comparisons having been selected and calculated by an independent provider of investment company
data. The investment adviser reported to the Board, and the Board took into account, the risk assumed by the investment adviser in the development of the Funds and provision of services as well as the competitive marketplace for financial products. The Trustees also considered fees charged by the investment adviser to other mutual funds and exchange-traded funds that it manages. The Board evaluated the Funds’ unitary fee through review of comparative information with respect to fees paid by other similar mutual funds tracking fixed income indices. Following such evaluation, the Board concluded, within the context of its full deliberations, that the expenses of each Fund are reasonable and supported renewal of the Agreement with respect to such Fund.
Profitability. The Trustees considered the compensation flowing to the investment adviser and its affiliates, directly or indirectly and reviewed profitability on a pre-tax basis, without regard to distribution expenses. The Trustees reviewed profitability of the investment adviser relating to the Schwab fund complex as a whole, noting the benefits to Fund shareholders of being part of the Schwab fund complex, including the allocations of certain costs across the Funds and other funds in the complex. The Trustees also considered any other benefits derived by the investment adviser from its relationship with the Funds, such as whether, by virtue of its management of the Funds, the investment adviser obtains investment information or other research resources that aid it in providing advisory services to other clients. The Trustees considered whether the compensation and profitability with respect to the Funds under the Agreement and other service agreements were reasonable in light of the quality of all services rendered to the Funds by the investment adviser and its affiliates. The Trustees noted that the investment adviser continues to invest substantial sums in its business in order to provide enhanced research capabilities, services and systems to benefit the Funds. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the profitability of the investment adviser with respect to each Fund is reasonable and supported renewal of the Agreement with respect to such Fund.
Economies of Scale. Although the Trustees recognized the difficulty of determining economies of scale with precision, and although the Funds do not have breakpoints in their advisory fees the Trustees considered the potential existence of any economies of scale by way of the relatively low advisory fee and unitary fee structure of the Funds and whether those are passed along to a Fund’s shareholders through (i) the enhancement of services provided to the Funds in return for fees paid, including through investments by the investment adviser in its infrastructure, including modernizing the investment adviser’s technology and use of data, increasing expertise and capabilities in key areas (including portfolio and trade operations), and improving business continuity, cybersecurity, due diligence, and information security programs, which are designed to provide enhanced services to
134
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
Schwab Taxable Bond Funds
the Funds and their shareholders; and (ii) pricing a fund to scale and keeping overall expenses down as the fund grows. The Trustees acknowledged that the investment adviser has invested in its infrastructure, as discussed above, over time and noted the impact of regulatory and other developments on the investment adviser’s internal costs of providing investment management, technology, administrative, legal and compliance services to the Funds. Based on this evaluation, the Board concluded, within the context of its full deliberations, that each Fund obtains reasonable benefits from economies of scale.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
In the course of their deliberations, the Trustees may have accorded different weights to various factors and did not
identify any particular information or factor that was all important or controlling. Based on the Trustees’ deliberation and their evaluation of the information described above, the Board, including all of the Independent Trustees, approved the continuation of the Agreement with respect to the Funds and concluded that the compensation under the Agreement with respect to the Funds is fair and reasonable in light of the services provided and the related expenses borne by the investment adviser and its affiliates and such other matters as the Trustees considered to be relevant in the exercise of their reasonable judgment.
Schwab Taxable Bond Funds | Annual Holdings and Financial Statements
135
Annual Holdings and Financial Statements | August 31, 2024
Schwab Municipal Bond Funds
Schwab Tax-Free Bond Fund
Schwab California Tax-Free Bond Fund
Schwab Opportunistic Municipal Bond Fund
Fund investment adviser: Charles Schwab Investment Management, Inc., dba Schwab Asset Management®
Distributor: Charles Schwab & Co., Inc. (Schwab)
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
1
Schwab Tax-Free Bond Fund
Financial Statements
| | | | | | |
|
Net asset value at beginning of period | | | | | | |
Income (loss) from investment operations: | | | | | | |
Net investment income (loss)1 | | | | | | |
Net realized and unrealized gains (losses) | | | | | | |
Total from investment operations | | | | | | |
| | | | | | |
Distributions from net investment income | | | | | | |
Distributions from net realized gains | | | | | | |
| | | | | | |
Net asset value at end of period | | | | | | |
| | | | | | |
|
Ratios to average net assets: | | | | | | |
| | | | | | |
| | | | | | |
Net investment income (loss) | | | | | | |
| | | | | | |
Net assets, end of period (x 1,000) | | | | | | |
| Calculated based on the average shares outstanding during the period. |
| The per share amount does not accord with the change in aggregate gains and losses in securities during the period because of the timing of fund transactions in relation to fluctuating market values. |
| Effective July 1, 2022, the net operating expense limitation was lowered from 0.49% to 0.38%. The ratio presented for the year ended August 31, 2022, is a blended ratio. |
| Ratio includes less than 0.005% of non-routine proxy expenses. |
2
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024
For fixed rate securities, the rate shown is the interest rate (the rate established when the security was issued). For variable rate securities, the rate shown is the rate as of the report date based on each security’s rate reset date. The reference rate and spread used is shown parenthetically in the security description, if available; if not, the reference rate is described in a footnote. The maturity date shown for all the securities is the final legal maturity.
ISSUER TYPE OF SECURITY, SERIES | | | | |
MUNICIPAL SECURITIES 101.5% OF NET ASSETS |
|
Black Belt Energy Gas District |
| | | | |
| | | | |
Energy Southeast Cooperative District |
Energy Supply RB Series 2024B | | | | |
|
| | | | |
|
| | | | |
| | | | |
The Southeast Alabama Gas District |
Gas Supply Refunding RB Series 2024B | | | | |
|
| | | | |
| | | | |
|
|
| | | | |
Chandler Industrial Development Auth |
IDRB (Intel Corp) Series 2019 | | | | |
IDRB (Intel Corp) Series 2022 | | | | |
| | | | |
|
Alameda Corridor Transportation Auth |
Sr Lien Refunding RB Series 2022A | | | | |
|
Toll Bridge RB Series 2021C (SIFMA Municipal Swap Index + 0.45%) | | | | |
|
| | | | |
California Community Choice Financing Auth |
RB (Deutsche Bank) Series 2023C | | | | |
California Educational Facilities Auth |
RB (St Marys College) Series 2023A | | | | |
California Health Facilities Financing Auth |
RB (CommonSpirit Health) Series 2024A | | | | |
RB (Kaiser Permanente) Series 2017A2 | | | | |
California Public Finance Auth |
RB (PIH Health) Series 2024A | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
3
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
California Statewide Communities Development Auth |
Hospital Refunding RB (Univ of Southern California) Series 2018 | | | | |
RB (Loma Linda Univ Medical Center) Series 2016A | | | | |
RB (Loma Linda Univ Medical Center) Series 2018A | | | | |
Hastings Campus Housing Financing Auth |
Campus Housing RB Series 2020A | | | | |
|
GO Refunding Bonds Series 2024A | | | | |
|
GO Refunding Bonds Series 2002A | | | | |
Rancho Cucamonga Successor Redevelopment Agency |
Tax Allocation Refunding Bonds Series 2014 | | | | |
San Diego Cnty Regional Airport Auth |
Sr Airport RB Series 2023B | | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
San Francisco Airport Commission |
| | | | |
| | | | |
| | | | |
| | | | |
Santa Cruz Cnty Successor Redevelopment Agency |
Tax Allocation Refunding Bonds 2014 | | | | |
| | | | |
|
Colorado Educational & Cultural Facilities Auth |
Charter School RB (Loveland Classical Schools) Series 2023 | | | | |
Colorado Health Facilities Auth |
RB (CommonSpirit Health) Series 2022A | | | | |
RB (CommonSpirit Health) Series 2022A | | | | |
RB (CommonSpirit Health) Series 2024A | | | | |
|
Airport System RB Series 2017A | | | | |
Airport System Sub RB Series 2023B | | | | |
Airport System Sub RB Series 2023B | | | | |
Airport System Sub RB Series 2023B | | | | |
Dedicated Tax RB Series 2018A-2 | | | | |
| | | | |
|
|
| | | | |
| | | | |
| | | | |
4
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
DISTRICT OF COLUMBIA 0.4% |
Metropolitan Washington Airports Auth |
Sr Lien Refunding RB (Dulles Metrorail) Series 2019A | | | | |
|
Florida Development Finance Corp |
Healthcare Facilities RB (Tampa General Hospital) Series 2024B | | | | |
RB (Brightline Trains) Series 2024 | | | | |
Florida Higher Educational Facilities Financing Auth |
Educational Facilities RB (Florida Institute of Technology) Series 2019 | | | | |
Educational Facilities RB (Florida Institute of Technology) Series 2019 | | | | |
Florida Insurance Assistance Interlocal Agency |
Insurance Assessment RB Series 2023A1 | | | | |
|
| | | | |
| | | | |
|
Health System RB (Baycare Health) Series 2024C | | | | |
Health System RB (Baycare Health) Series 2024C | | | | |
Health System RB (Baycare Health) Series 2024C | | | | |
|
Health Care Facilities Refunding RB (Baptist Health) Series 2017 | | | | |
Lee Cnty Industrial Development Auth |
Healthcare Facilities RB (Shell Point Obligated Group) Series 2024A | | | | |
Healthcare Facilities RB (Shell Point Obligated Group) Series 2024B2 | | | | |
Healthcare Facilities RB (Shell Point Obligated Group) Series 2024B3 | | | | |
Miami Beach Health Facilities Auth |
Hospital Refunding & RB (Mt Sinai Medical Center) Series 2014 | | | | |
Hospital Refunding & RB (Mt Sinai Medical Center) Series 2014 | | | | |
|
Refunding RB Series 2020A | | | | |
|
RB (Moffitt Cancer Center) Series 2023A | | | | |
|
| | | | |
|
Tax Allocation RB (Moffitt Cancer Center) Series 2020A | | | | |
Tax Allocation RB (Moffitt Cancer Center) Series 2020A | | | | |
Tax Allocation RB (Moffitt Cancer Center) Series 2020A | | | | |
Tax Allocation RB (Moffitt Cancer Center) Series 2020A | | | | |
Tax Allocation RB (Moffitt Cancer Center) Series 2020A | | | | |
|
Utility System RB Series 2022 | | | | |
Village Community Dev Dist. No.15 |
| | | | |
| | | | |
| | | | |
| | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
5
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
|
Airport PFC & Sub Lien RB Series 2022D | | | | |
Columbia Cnty Hospital Auth |
Revenue Anticipation Certificates (Wellstar Health System) Series 2023A | | | | |
Gainesville & Hall Cnty Hospital Auth |
Revenue Anticipation Certificates (Northeast Georgia Health System) Series 2024 | | | | |
Georgia State Road & Tollway Auth |
Managed Lane System RB Series 2021A | | | | |
Main Street Natural Gas Inc |
Gas Supply RB Series 2023A | | | | |
Gas Supply RB Series 2023B | | | | |
Gas Supply RB Series 2023B | | | | |
Gas Supply RB Series 2023D | | | | |
Gas Supply RB Series 2024B | | | | |
Gas Supply RB Series 2024C | | | | |
| | | | |
|
|
Water & Wastewater System Refunding RB Series 2024A | | | | |
Water & Wastewater System Refunding RB Series 2024A | | | | |
Water & Wastewater System Refunding RB Series 2024A | | | | |
| | | | |
|
|
Airport System RB Series 2020A | | | | |
|
|
| | | | |
|
|
GO Refunding Bonds Series 2014 | | | | |
GO Refunding Bonds Series 2016B | | | | |
|
2nd Lien Wastewater Refunding RB Series 2024A | | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
Chicago Board of Education |
ULT GO Bonds Series 2023A | | | | |
|
| | | | |
| | | | |
6
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Sr Lien Airport Refunding RB Series 2023C | | | | |
Chicago O’Hare International Airport |
OHare General Airport Sr Lien Refunding RB Series 2012A | | | | |
OHare General Airport Sr Lien Refunding RB Series 2015B | | | | |
OHare General Airport Sr Lien Refunding RB Series 2015B | | | | |
OHare General Airport Sr Lien Refunding RB Series 2016C | | | | |
OHare General Airport Sr Lien Refunding RB Series 2016C | | | | |
|
LT GO Refunding Bonds Series 2023C | | | | |
Chicago Transit Auth Sales Tax |
| | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
GO Bonds Series May 2024B | | | | |
GO Bonds Series May 2024B | | | | |
GO Bonds Series May 2024B | | | | |
GO Refunding Bonds Series 2016 | | | | |
GO Refunding Bonds Series 2018B | | | | |
|
RB (OSF Healthcare System) Series 2020B1 | | | | |
RB (Rosalind Franklin Univ) Series 2017A | | | | |
RB (Rosalind Franklin Univ) Series 2017A | | | | |
RB (Rosalind Franklin Univ) Series 2017A | | | | |
Refunding RB (OSF Healthcare System) Series 2018B | | | | |
Refunding RB (Southern Illinois Healthcare Enterprises) Series 2017C | | | | |
Refunding RB (Southern Illinois Healthcare Enterprises) Series 2017C | | | | |
Illinois Toll Highway Auth |
Toll Highway Sr RB Series 2015A | | | | |
Toll Highway Sr RB Series 2024A | | | | |
Kankakee River Metropolitan Agency |
Sr Lien Sewage Treatment Facility Refunding RB Series 2016 | | | | |
Metropolitan Pier & Exposition Auth |
| | | | |
|
Auxiliary Facilities System RB Series 2021 | | | | |
Auxiliary Facilities System RB Series 2021 | | | | |
Auxiliary Facilities System Refunding RB Series 2020B | | | | |
Auxiliary Facilities System Refunding RB Series 2020B | | | | |
| | | | |
|
|
Gas Project RB Series 2019 | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
7
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Johnson & Miami Cnty USD No. 230 |
| | | | |
|
|
| | | | |
Kentucky Public Energy Auth |
Gas Supply RB Series 2018C1 | | | | |
Gas Supply Refunding RB Series 2024B | | | | |
|
| | | | |
| | | | |
|
Louisiana Housing Corp M/F Revenue |
S/F Mortgage RB Series 2023C | | | | |
Louisiana Offshore Terminal Auth |
Port RB (LOOP LLC) Series 2007A | | | | |
Louisiana Public Facilities Auth |
RB (Loyola Univ) Series 2023A | | | | |
Refunding RB (Ochsner Clinic Fdn) Series 2017 | | | | |
Louisiana Stadium & Exposition District |
| | | | |
|
Public Improvement Bonds Series 2021A | | | | |
| | | | |
|
|
General Airport Refunding RB Series 2019 | | | | |
General Airport Refunding RB Series 2019 | | | | |
| | | | |
|
|
Metropolitan District GO Bonds 78th Issue | | | | |
|
GO Bonds 1st Series 2018A | | | | |
Maryland Health & Higher Educational Facilities Auth |
RB (Frederick Health System) Series 2020 | | | | |
|
RB (Diakon Lutheran Social Ministries) Series 2019B | | | | |
Washington Suburban Sanitary District |
| | | | |
| | | | |
8
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Massachusetts Development Finance Agency |
RB (Beth Israel Lahey Health) Series 2023M | | | | |
RB (Boston Medical Center) Series 2016E | | | | |
RB (Boston Medical Center) Series 2023G | | | | |
RB (Boston Medical Center) Series 2023G | | | | |
RB (Lahey Health System) Series 2015F | | | | |
RB (UMASS Memorial Health) Series 2016I | | | | |
|
S/F Housing RB Series 183 | | | | |
S/F Housing RB Series 203 | | | | |
| | | | |
|
Detroit Mich Downtown Dev Auth |
| | | | |
|
Water Supply System 2nd Lien RB Series 2022B | | | | |
|
| | | | |
| | | | |
|
ULT GO Bonds Series 2023II | | | | |
|
Sr RB (Provident Group HFH Energy LLC) Series 2024 | | | | |
Sr RB (Provident Group HFH Energy LLC) Series 2024 | | | | |
Michigan Housing Development Auth |
S/F Mortgage RB Series 2015A | | | | |
|
| | | | |
| | | | |
| | | | |
|
|
Health Care Facilities Refunding RB (Hazelden Betty Ford Fdn) Series 2019 | | | | |
|
Refunding COP Series 2019C | | | | |
Refunding COP Series 2019C | | | | |
Minnesota Higher Educational Facilities Auth |
RB (St. Thomas Univ) Series 2024A | | | | |
| | | | |
|
Mississippi Business Finance Corp |
Gulf Opportunity Zone IDRB (Chevron) Series 2011E | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
9
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Mississippi Development Bank |
Special Obligation (Jackson Public SD) RB Series 2018 | | | | |
Special Obligation (Jackson Public SD) RB Series 2018 | | | | |
| | | | |
|
Missouri Health & Educational Facilities Auth |
Educational Facilities RB (Kansas City Univ of Medicine) Series 2017A | | | | |
Educational Facilities RB (Kansas City Univ of Medicine) Series 2017A | | | | |
Sr Living Facilities RB (Lutheran Sr Services) Series 2024A | | | | |
Sr Living Facilities RB (Lutheran Sr Services) Series 2024A | | | | |
Sr Living Facilities RB (Lutheran Sr Services) Series 2024A | | | | |
Missouri Housing Development Commission |
S/F Mortgage RB Series 2017D | | | | |
S/F Mortgage RB Series 2018A | | | | |
|
| | | | |
| | | | |
|
|
S/F Housing RB Series 2018A | | | | |
S/F Mortgage Bonds Series 2023B | | | | |
| | | | |
|
|
RB (Father Flanagan Boys Home) Series 2017 | | | | |
|
| | | | |
| | | | |
|
|
Hospital Refunding RB (Carson Tahoe Regional Healthcare) Series 2017 | | | | |
Hospital Refunding RB (Carson Tahoe Regional Healthcare) Series 2017 | | | | |
|
| | | | |
| | | | |
|
National Fin Auth Novant Health |
Health Care Facilities RB (Novant Health) Series 2024B | | | | |
|
|
Tax Appeal Refunding Bonds Series 2017A | | | | |
10
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
New Jersey Transportation Trust Fund Auth |
Transportation Bonds Series 2023BB | | | | |
Transportation Bonds Series 2023BB | | | | |
Transportation Program Bonds Series 2015AA | | | | |
Transportation Program Bonds Series 2023AA | | | | |
Transportation Program Notes Series 2014 BB1 | | | | |
Transportation System Bonds Series 2023A | | | | |
Transportation System RB Series 2019BB | | | | |
|
| | | | |
| | | | |
|
New Mexico Mortgage Finance Auth |
S/F Mortgage RB Series 2018B | | | | |
|
Metropolitan Transportation Auth |
Transportation RB Series 2015A2 | | | | |
Transportation RB Series 2020C1 | | | | |
Transportation Refunding RB Series 2024A | | | | |
Nassau Cnty Local Economic Assistance Corp |
RB (Catholic Health Services Long Island) Series 2014 | | | | |
RB (Catholic Health Services Long Island) Series 2014 | | | | |
|
GO Bonds Fiscal 2018 Series B4 | | | | |
GO Bonds Fiscal 2022 Series A1 | | | | |
GO Bonds Fiscal 2024 Series D | | | | |
GO Bonds Fiscal 2025 Series C1 | | | | |
New York City Transitional Finance Auth |
Building Aid RB Fiscal 2019 Series S3A | | | | |
Building Aid RB Fiscal 2019 Series S3A | | | | |
Future Tax Secured Sub Bonds Fiscal 2020 Series A2 | | | | |
Future Tax Secured Sub Bonds Fiscal 2023 Series F1 | | | | |
Future Tax Secured Sub Bonds Fiscal 2024 Series D1 | | | | |
Future Tax Secured Sub Bonds Fiscal 2024 Series G1 | | | | |
Future Tax Secured Sub Bonds Fiscal 2024 Series G1 | | | | |
New York State Dormitory Auth |
RB (New York Institute of Technology) Series 2024 | | | | |
RB (Rochester Institute of Technology) Series 2022A | | | | |
State Personal Income Tax RB Series 2019A | | | | |
State Personal Income Tax RB Series 2019D | | | | |
New York State Thruway Auth |
| | | | |
| | | | |
New York Transportation Development Corp |
Special Facilities RB (JFK Airport - New Terminal 1) Series 2023 | | | | |
Special Facilities RB (JFK Airport - New Terminal 1) Series 2024 | | | | |
Special Facilities RB (JFK Airport - New Terminal 1) Series 2024 | | | | |
Special Facilities RB (JFK Airport - Terminal 4) Series 2020A | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
11
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Port Auth of New York & New Jersey |
Consolidated Bonds 221st Series | | | | |
Consolidated Bonds 236th Series | | | | |
Consolidated Bonds 236th Series | | | | |
Sales Tax Asset Receivable Corp |
| | | | |
Triborough Bridge & Tunnel Auth |
Sales Tax RB Series 2023A | | | | |
| | | | |
| | | | |
|
|
| | | | |
Greater Asheville Regional Airport Auth |
Airport System RB Series 2022A | | | | |
Airport System RB Series 2022A | | | | |
North Carolina Capital Facilities Finance Agency |
Educational Facilities Refunding RB (Meredith College) Series 2018 | | | | |
Educational Facilities Refunding RB (Meredith College) Series 2018 | | | | |
Educational Facilities Refunding RB (Meredith College) Series 2018 | | | | |
Educational Facilities Refunding RB (Meredith College) Series 2018 | | | | |
Educational Facilities Refunding RB (Meredith College) Series 2018 | | | | |
North Carolina Medical Care Commission Retirement Facilities |
Retirement Facilities 1st Mortgage RB (Carolina Meadows) Series 2024 | | | | |
Retirement Facilities 1st Mortgage RB (United Methodist Retirement Homes) Series 2024A | | | | |
| | | | |
|
|
Refunding Bonds Series 2019B | | | | |
|
Buckeye Tobacco Settlement Financing Auth |
Tobacco Settlement Refunding Bonds Series 2020A-2 | | | | |
|
Airport System RB Series 2019B | | | | |
|
ULT GO Bonds Series 2017A | | | | |
| | | | |
|
Norman Regional Hospital Auth |
| | | | |
Oklahoma Development Finance Auth |
| | | | |
| | | | |
12
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Astoria Hospital Facilities Auth |
RB (Columbia Memorial Hospital) Series 2024 | | | | |
|
Campus Refunding & RB (Pacific Univ) Series 2015A | | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
|
| | | | |
|
| | | | |
|
Transient Lodging Tax RB Series 2018 | | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
|
Lancaster Cnty Hospital Auth |
RB (Penn State Health) Series 2021 | | | | |
Pennsylvania Economic Development Financing Auth |
Solid Waste Disposal Refunding RB (Republic Services Inc) Series 2019A | | | | |
Pennsylvania State Turnpike Commission |
| | | | |
| | | | |
| | | | |
| | | | |
|
GO Refunding Bonds Series 2019A | | | | |
GO Refunding Bonds Series 2019A | | | | |
Philadelphia Redevelopment Auth Financing Corp |
| | | | |
Pocono Mountains Park Auth |
Hospital RB (St Luke’s Hospital) Series 2015A | | | | |
| | | | |
|
Puerto Rico Sales Tax Financing Corp |
Restructured Sales Tax Bonds Series 2019A1 | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
13
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Rhode Island Health & Educational Building Corp |
Higher Education Facility RB (Bryant Univ) Series 2024 | | | | |
Hospital Financing RB (Lifespan Obligated Group) Series 2024 | | | | |
Hospital Financing RB (Lifespan Obligated Group) Series 2024 | | | | |
Hospital Financing RB (Lifespan Obligated Group) Series 2024 | | | | |
| | | | |
|
South Carolina Jobs Economic Development Auth |
Health Care Facilities RB (Novant Health) Series 2024A | | | | |
South Carolina Public Service Auth |
Refunding RB Series 2020A | | | | |
Refunding RB Series 2024B | | | | |
| | | | |
|
|
| | | | |
South Dakota Health & Educational Facilities Auth |
| | | | |
| | | | |
|
Chattanooga-Hamilton Cnty Hospital Auth |
Hospital Refunding & RB (Erlanger Health) Series 2014A | | | | |
Hospital Refunding & RB (Erlanger Health) Series 2014A | | | | |
Metro Government of Nashville & Davidson Cnty Health & Educational Facilities Board |
Educational Facilities RB (Belmont Univ) Series 2023 | | | | |
Metropolitan Nashville Airport Auth |
| | | | |
| | | | |
Shelby Cnty Health, Educational & Housing Facilities Board |
Health Care Refunding (Baptist Memorial Health Care) RB Series 2024B | | | | |
Tennessee Housing Development Agency Home Ownership |
Residential Finance Program Bonds Series 2023-3A | | | | |
| | | | |
|
|
GO Revenue & Refunding Bonds Series 2024 | | | | |
|
Airport System RB Series 2022 | | | | |
Airport System RB Series 2022 | | | | |
Central Texas Regional Mobility Auth |
| | | | |
| | | | |
|
Water & Sewer System RB Series 2023 | | | | |
14
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
ULT GO Refunding Bonds Series 2015A | | | | |
|
Utility System Jr Lien RB Series 2022B | | | | |
|
Sr Lien Special Tax RB (Kay Bailey Hutchison Convention Center) Series 2023 | | | | |
Dallas-Fort Worth International Airport |
Jt Refunding RB Series 2024 | | | | |
|
| | | | |
|
| | | | |
|
| | | | |
|
ULT GO Bonds Series 2023A | | | | |
|
| | | | |
| | | | |
Greater Texoma Utility Auth |
| | | | |
| | | | |
|
| | | | |
Harris Cnty Cultural Education Facilities Finance Corp |
Hospital RB (Texas Childrens Hospital) Series 2021C | | | | |
Medical Facilities RB (Baylor College of Medicine) Series 2024A | | | | |
RB (Houston Methodist) Series 2020B | | | | |
|
Sub Lien Refunding RB Series 2018A | | | | |
Lower Colorado River Auth |
Refunding RB (LCRA Transmission Services) Series 2016 | | | | |
|
Waterworks & Sewer System RB Series 2022 | | | | |
Newark Higher Education Finance Corp |
Education RB (Orenda) Series 2023A | | | | |
Education RB (Orenda) Series 2023A | | | | |
Education RB (The Hughen Center) Series 2022A | | | | |
Education RB (The Hughen Center) Series 2022A | | | | |
Education RB (The Hughen Center) Series 2022A | | | | |
Education RB (The Hughen Center) Series 2022A | | | | |
North East Texas Regional Mobility Auth |
| | | | |
|
Variable Rate ULT GO Refunding Bonds Series 2024B | | | | |
|
ULT GO Bonds Series 2019B | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
15
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Electric & Gas System Refunding RB Series 2024A | | | | |
Electric & Gas System Refunding RB Series 2024B | | | | |
| | | | |
|
ULT GO Refunding Bonds Series 2015B | | | | |
|
| | | | |
Tarrant Cnty Cultural Education Facilities Finance Corp |
Hospital RB (Baylor Scott & White) Series 2022D | | | | |
RB (Christus Health) Series 2024A | | | | |
|
| | | | |
Texas Dept of Housing & Community Affairs |
Residential Mortgage RB Series 2019A | | | | |
S/F Mortgage RB Series 2018A | | | | |
Texas Municipal Gas Corp III |
Gas Supply Refunding RB Series 2021 | | | | |
Texas State Affordable Housing Corp Heroes 2019 Program |
S/F Mortgage RB Series 2019A | | | | |
Texas Transportation Commission |
2nd Tier Refunding RB Series 2024C | | | | |
Texas Transportation Corp |
Sr Lien RB (NTE Mobility Partners) Series 2023 | | | | |
|
Tax & Revenue Certificates of Obligation Series 2023 | | | | |
Tax & Revenue Certificates of Obligation Series 2023 | | | | |
Tax & Revenue Certificates of Obligation Series 2023 | | | | |
| | | | |
|
|
Student Building Fee RB Series 2018 | | | | |
Student Building Fee RB Series 2018 | | | | |
| | | | |
|
|
Multiple Purpose Bonds Series 2017D | | | | |
Multiple Purpose Bonds Series 2018A | | | | |
Multiple Purpose Bonds Series 2018C | | | | |
| | | | |
|
|
Health Care RB (Inova Health System) Series 2024 | | | | |
Lynchburg Economic Development Auth |
Hospital Refunding RB (Centra Health) Series 2021 | | | | |
16
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
RB (Valley Health System) Series 2024B1 | | | | |
| | | | |
|
Central Puget Sound Regional Transit Auth |
Sales & Motor Vehicle Excise Tax RB Series 2016S1 | | | | |
King Cnty Public Hospital District #2 |
LT GO Refunding Bonds (EvergreenHealth) Series 2015 | | | | |
|
| | | | |
|
| | | | |
| | | | |
|
| | | | |
| | | | |
Skagit Cnty Hospital District No 1 |
| | | | |
| | | | |
|
| | | | |
Washington Health Care Facilities Auth |
RB (Overlake Hospital) Series 2014 | | | | |
Refunding RB (Overlake Hospital) Series 2017B | | | | |
Washington State Housing Finance Commission |
| | | | |
| | | | |
|
West Virginia Hospital Finance Auth |
Hospital RB (West Virginia Univ Health System) Series 2023A | | | | |
Hospital Revenue & Refunding Bonds (Vandalia Health) Series 2023B | | | | |
| | | | |
|
Wisconsin Center District |
Jr Dedicated Tax RB Series 2020D | | | | |
Jr Dedicated Tax RB Series 2020D | | | | |
Jr Dedicated Tax RB Series 2020D | | | | |
Wisconsin Health & Educational Facilities Auth |
RB (Fort HealthCare Inc) Series 2024B | | | | |
RB (Franciscan Sisters of Christian Charity) Series 2017A | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
17
Schwab Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
RB (Franciscan Sisters of Christian Charity) Series 2017A | | | | |
RB (UnityPoint Health) Series 2014A | | | | |
| | | | |
Total Municipal Securities
(Cost $592,399,828) | |
Total Investments in Securities
(Cost $592,399,828) | |
| The effective maturity may be shorter than the final maturity shown because the security is subject to a put, demand or call feature. |
| Bond currently pays a fixed coupon rate and will be remarketed at a to be determined rate at the end of the current fixed rate term. |
| Step up bond that pays an initial coupon rate for a set period and increased coupon rates at one or more preset intervals. Rate shown is as of period end. |
| Variable rate security; rate shown is effective rate at period end. |
| Security or a portion of the security purchased on a delayed-delivery or when-issued basis. |
| |
| Credit-enhanced or liquidity-enhanced. |
| VRDN is a municipal security which allows holders to sell their security through a put or tender feature, at par value plus accrued interest. The interest rate resets on a periodic basis, the majority of which are weekly but may be daily or monthly. Unless a reference rate and spread is shown parenthetically, the Remarketing Agent, generally a dealer, determines the interest rate for the security at each interest rate reset date. The rate is typically based on the SIFMA Municipal Swap Index. |
| |
| |
| Certificate of participation |
| |
| Housing finance agency/authority |
| Industrial development agency/authority |
| Industrial development revenue bond |
| Independent school district |
| |
| |
| Passenger facility charge |
| |
| |
| |
| Securities Industry and Financial Markets Association. The SIFMA Municipal Swap Index is a market index comprised of high-grade 7-day tax-exempt Variable Rate Demand Obligations with certain characteristics. |
| |
| |
| Variable rate demand note |
The following is a summary of the inputs used to value the fund’s investments as of August 31, 2024 (see financial note 2(a) for additional information):
| QUOTED PRICES IN
ACTIVE MARKETS FOR
IDENTICAL ASSETS
(LEVEL 1) | OTHER SIGNIFICANT
OBSERVABLE INPUTS
(LEVEL 2) | SIGNIFICANT
UNOBSERVABLE INPUTS
(LEVEL 3) | |
| | | | |
| | | | |
| | | | |
| As categorized in the Portfolio Holdings. |
18
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Statement of Assets and Liabilities
|
Investments in securities, at value - unaffiliated issuers (cost $592,399,828) | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
Investments bought - delayed-delivery | | |
Distributions to shareholders | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
Capital received from investors | | |
| | |
| | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
19
Schwab Tax-Free Bond Fund
Statement of Operations
For the period September 1, 2023 through August 31, 2024 |
|
Interest received from securities - unaffiliated issuers | | |
|
|
Investment adviser and administrator fees | | |
| | |
Portfolio accounting fees | | |
| | |
| | |
| | |
| | |
Independent trustees’ fees | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
REALIZED AND UNREALIZED GAINS (LOSSES) |
Net realized losses on sales of securities - unaffiliated issuers | | |
Net change in unrealized appreciation (depreciation) on securities - unaffiliated issuers | | |
Net realized and unrealized gains | | |
Increase in net assets resulting from operations | | |
20
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Tax-Free Bond Fund
Statement of Changes in Net Assets
For the current and prior report periods
|
| | |
| | | |
| | | |
Net change in unrealized appreciation (depreciation) | | | |
Increase in net assets resulting from operations | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS |
| | | |
TRANSACTIONS IN FUND SHARES |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Net transactions in fund shares | | | | | |
|
SHARES OUTSTANDING AND NET ASSETS |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
21
Schwab California Tax-Free Bond Fund
Financial Statements
| | | | | | |
|
Net asset value at beginning of period | | | | | | |
Income (loss) from investment operations: | | | | | | |
Net investment income (loss)1 | | | | | | |
Net realized and unrealized gains (losses) | | | | | | |
Total from investment operations | | | | | | |
| | | | | | |
Distributions from net investment income | | | | | | |
Distributions from net realized gains | | | | | | |
| | | | | | |
Net asset value at end of period | | | | | | |
| | | | | | |
|
Ratios to average net assets: | | | | | | |
| | | | | | |
| | | | | | |
Net investment income (loss) | | | | | | |
| | | | | | |
Net assets, end of period (x 1,000) | | | | | | |
| Calculated based on the average shares outstanding during the period. |
| Effective July 1, 2022, the net operating expense limitation was lowered from 0.49% to 0.38%. The ratio presented for the year ended August 31, 2022, is a blended ratio. |
| Ratio includes less than 0.005% of non-routine proxy expenses. |
22
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024
For fixed rate securities, the rate shown is the interest rate (the rate established when the security was issued). For variable rate securities, the rate shown is the rate as of the report date based on each security’s rate reset date. The reference rate and spread used is shown parenthetically in the security description, if available; if not, the reference rate is described in a footnote. The maturity date shown for all the securities is the final legal maturity.
ISSUER TYPE OF SECURITY, SERIES | | | | |
MUNICIPAL SECURITIES 102.9% OF NET ASSETS |
|
|
| | | | |
Alameda Corridor Transportation Auth |
2nd Sub Lien Refunding RB Series 2022C | | | | |
Sr Lien Refunding RB Series 2022A | | | | |
Sr Lien Refunding RB Series 2024A | | | | |
Sr Lien Refunding RB Series 2024A | | | | |
Sub Lien Refunding RB Series 2024C | | | | |
Sub Lien Refunding RB Series 2024C | | | | |
|
| | | | |
American Canyon Finance Auth |
| | | | |
|
Electric System Refunding RB Series 2015 | | | | |
|
Toll Bridge RB Series 2017H | | | | |
Toll Bridge RB Series 2023A | | | | |
Toll Bridge RB Series 2024I | | | | |
|
| | | | |
| | | | |
Burbank Glendale Pasadena Airport Auth |
Sr Airport RB Series 2024B | | | | |
Sr Airport RB Series 2024B | | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
GO Refunding Bonds Series 2016 | | | | |
GO Refunding Bonds Series 2017 | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
23
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
California Cnty Tobacco Securitization Agency |
Tobacco Settlement RB (Los Angeles Cnty Securitization) Series 2020A | | | | |
Tobacco Settlement Sr Refunding Bonds (Gold Country) Series 2020A | | | | |
California Community Choice Financing Auth |
Clean Energy RB Series 2023D | | | | |
RB (Deutsche Bank) Series 2023C | | | | |
| | | | |
| | | | |
| | | | |
California Educational Facilities Auth |
RB (Art Center College of Design) Series 2018A | | | | |
RB (Santa Clara Univ) Series 2015 | | | | |
RB (St Marys College) Series 2023A | | | | |
RB (University of Redlands) Series 2022A | | | | |
California Health Facilities Financing Auth |
RB (Adventist Health) Series 2024A | | | | |
RB (Adventist Health) Series 2024A | | | | |
RB (CommonSpirit Health) Series 2020A | | | | |
RB (CommonSpirit Health) Series 2020A | | | | |
RB (CommonSpirit Health) Series 2024A | | | | |
RB (CommonSpirit Health) Series 2024A | | | | |
RB (CommonSpirit Health) Series 2024A | | | | |
RB (Episcopal Communities & Services) Series 2024A | | | | |
RB (Episcopal Communities & Services) Series 2024B | | | | |
RB (Kaiser Permanente) Series 2017A2 | | | | |
RB (On Lok Sr Health Services) Series 2020 | | | | |
Refunding RB (Marshall Medical Center) Series 2015 | | | | |
Refunding RB (Marshall Medical Center) Series 2015 | | | | |
California Infrastructure & Economic Development Bank |
Refunding RB (Academy of Motion Picture Arts & Sciences) Series 2023A | | | | |
Refunding RB (Walt Disney Family Museum) Series 2016 | | | | |
Refunding RB (Walt Disney Family Museum) Series 2016 | | | | |
Refunding RB (Walt Disney Family Museum) Series 2016 | | | | |
California Infrastructure & Economic Development Fund |
RB (Adventist Health Energy) Series 2024A | | | | |
RB (Adventist Health Energy) Series 2024A | | | | |
California Municipal Finance Auth |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
Insured Refunding RB (Channing House) Series 2017A | | | | |
Insured Refunding RB (Channing House) Series 2017A | | | | |
Mobile Home Park Sr RB (Caritas Projects) Series 2024A | | | | |
Mobile Home Park Sr RB (Caritas Projects) Series 2024A | | | | |
RB (Inland Christian Home) Series 2020 | | | | |
RB (National Univ) Series 2019A | | | | |
RB (National Univ) Series 2019A | | | | |
RB (Samuel Merritt Univ) Series 2022 | | | | |
24
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
RB (St Ignatius College Prep) Series 2024A | | | | |
RB (St Ignatius College Prep) Series 2024A | | | | |
RB (Univ of La Verne) Series 2017A | | | | |
Refunding RB (Aldersly) Series 2023A | | | | |
Refunding RB (Eisenhower Medical Center) Series 2017B | | | | |
Refunding RB (Eisenhower Medical Center) Series 2017B | | | | |
Refunding RB (HumanGood California) Series 2019A | | | | |
Refunding RB (HumanGood California) Series 2019A | | | | |
Refunding RB (HumanGood California) Series 2019A | | | | |
Refunding RB (Institute of Aging) Series 2017 | | | | |
Refunding RB (Institute of Aging) Series 2017 | | | | |
Refunding RB (Institute of Aging) Series 2017 | | | | |
Refunding RB (Institute of Aging) Series 2017 | | | | |
Solid Waste Disposal Refunding RB Series 2021A | | | | |
Special Tax RB (Bold Program) Series 2023B | | | | |
Sr RB (Caritas Projects) Series 2023A | | | | |
California Pollution Control Financing Auth |
Solid Waste Disposal RB (Republic Services Inc) Series 2017 | | | | |
California Public Finance Auth |
RB (Henry Mayo Newhall Hospital) Series 2017 | | | | |
RB (Henry Mayo Newhall Hospital) Series 2017 | | | | |
RB (PIH Health) Series 2024A | | | | |
RB (PIH Health) Series 2024A | | | | |
RB (PIH Health) Series 2024A | | | | |
California Public Works Board |
| | | | |
| | | | |
Lease Refunding RB Series 2022C | | | | |
California School Finance Auth |
RB (Granada Hills Charter) Series 2024A | | | | |
RB (Granada Hills Charter) Series 2024A | | | | |
RB (Granada Hills Charter) Series 2024A | | | | |
RB (Granada Hills Charter) Series 2024A | | | | |
School Facility RB (Kipp LA) Series 2017A | | | | |
|
| | | | |
| | | | |
California Statewide Communities Development Auth |
Hospital Refunding RB (Univ of Southern California) Series 2018 | | | | |
Hospital Refunding RB (Univ of Southern California) Series 2018 | | | | |
Pollution Control Refunding RB (Southern California Edison) Series 2006C | | | | |
RB (Adventist Health System West) Series 2018A | | | | |
RB (Loma Linda Univ Medical Center) Series 2018A | | | | |
RB (Redlands Community Hospital) Series 2016 | | | | |
RB (Redlands Community Hospital) Series 2016 | | | | |
RB (Viamonte Sr Living 1) Series 2018A | | | | |
RB (Viamonte Sr Living 1) Series 2018A | | | | |
RB (Viamonte Sr Living 1) Series 2018A | | | | |
RB (Viamonte Sr Living 1) Series 2018A | | | | |
RB (Viamonte Sr Living 1) Series 2018A | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
25
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Refunding RB (CHF-Irvine) Series 2016 | | | | |
Refunding RB (CHF-Irvine) Series 2016 | | | | |
Salinas Transportation Revenue COPs Series 2018B | | | | |
Salinas Transportation Revenue COPs Series 2018B | | | | |
California Statewide Communities Development Auth District 2021-02 |
Special Tax Bonds Series 2023 | | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
|
| | | | |
|
Wastewater Refunding RB Series 2015 | | | | |
|
| | | | |
|
GO Refunding Bonds Series 2016F | | | | |
|
| | | | |
|
| | | | |
Discovery Bay Public Financing Auth |
Water & Wastewater Enterprise RB Series 2022 | | | | |
East Bay Municipal Utility District |
Wastewater System RB Series 2024A | | | | |
Water System Refunding RB Series 2015A | | | | |
Eastern Municipal Water District |
Water & Wastewater Refunding RB Series 2018A | | | | |
Foothill Eastern Transportation Corridor Agency |
Toll Road Refunding RB Series 2013A | | | | |
Fresno Jt Power Finance Auth |
Lease Refunding RB Series 2017A | | | | |
Lease Refunding RB Series 2017A | | | | |
|
| | | | |
| | | | |
Golden West Schools Financing Auth |
GO RB (Rowland USD) Series 2005 | | | | |
|
Refunding RB Series 2023A | | | | |
Greenfield Redevelopment Agency |
Tax Allocation Refunding Bonds Series 2016 | | | | |
Tax Allocation Refunding Bonds Series 2016 | | | | |
|
| | | | |
Hastings Campus Housing Financing Auth |
Campus Housing RB Series 2020A | | | | |
26
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Hastings College of the Law |
Refunding Bonds Series 2017 | | | | |
Refunding Bonds Series 2017 | | | | |
Refunding Bonds Series 2017 | | | | |
|
| | | | |
Independent Cities Finance Auth |
Mobile Home Park Refunding RB (Union City Tropics) Series 2019 | | | | |
Mobile Home Park Refunding RB (Union City Tropics) Series 2019 | | | | |
Mobile Home Park Refunding RB (Union City Tropics) Series 2019 | | | | |
Indian Wells Successor Redevelopment Agency |
Consolidated Whitewater Redevelopment Sub Tax Allocation Refunding Bonds Series 2015A | | | | |
Inglewood Successor Redevelopment Agency |
Sub Lien Tax Allocation RB Series 2017A | | | | |
|
| | | | |
| | | | |
Irvine Community Facilities District No 2013-3 |
Special Tax Refunding Bonds Series 2024 | | | | |
Special Tax Refunding Bonds Series 2024 | | | | |
Irvine Facilities Financing Auth |
| | | | |
Irvine Ranch Water District |
GO Refunding Bonds Series 2011A1 (SIFMA Municipal Swap Index + 0.05%) | | | | |
Kern Cnty Water Agency Improvement District #4 |
Refunding RB Series 2016A | | | | |
|
| | | | |
Lancaster Redevelopment Agency |
Tax Allocation Refunding Bonds Series 2017 | | | | |
Tax Allocation Refunding Bonds Series 2017 | | | | |
Livermore Valley Joint USD |
| | | | |
|
GO Refunding Bonds Series 2015F | | | | |
|
Sr Airport RB Series 2022C | | | | |
|
| | | | |
|
GO Refunding Bonds Series 2016 | | | | |
|
Wastewater System RB Series 2015A | | | | |
Los Angeles Cnty Public Works Financing Auth |
| | | | |
| | | | |
| | | | |
Los Angeles Cnty Redevelopment Refunding Auth |
Tax Allocation Refunding RB (South Gate) Series 2014A | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
27
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Los Angeles Cnty Sanitation Districts Financing Auth |
Sub RB (District #14) Series 2015A | | | | |
Los Angeles Dept of Airports |
| | | | |
Sr Refunding RB Series 2018B | | | | |
| | | | |
| | | | |
| | | | |
Sub Refunding RB Series 2021A | | | | |
Sub Refunding RB Series 2023A | | | | |
Sub Refunding RB Series 2023A | | | | |
Los Angeles Dept of Water & Power |
Power System RB Series 2001B3 | | | | |
Power System RB Series 2002A5 | | | | |
Power System RB Series 2015A | | | | |
Power System RB Series 2023C1 | | | | |
Power System RB Series 2023F2 | | | | |
Los Angeles Development Auth |
M/F Housing RB Series 2022F | | | | |
|
Refunding RB Series 2015A | | | | |
|
| | | | |
| | | | |
| | | | |
GO Refunding Bonds Series 2024A | | | | |
GO Refunding Bonds Series 2024A | | | | |
Los Osos Community Facilities Wastewater Assessment District #1 |
Limited Obligation Refunding Bonds Series 2019 | | | | |
Limited Obligation Refunding Bonds Series 2019 | | | | |
Madera Irrigation District |
Water Refunding RB Series 2015 | | | | |
Marina Coast Water District |
| | | | |
|
GO Refunding Bonds Series 2015 | | | | |
Midpeninsula Open Space District |
| | | | |
| | | | |
Modesto Irrigation District Financing Auth |
Electric System RB Series 2015A | | | | |
Electric System RB Series 2015A | | | | |
|
| | | | |
Northern California Energy Auth |
Refunding RB Series 2024A1 | | | | |
Northern California Sanitation Agencies Financing Authority |
| | | | |
|
GO Refunding Bonds Series 2015A | | | | |
28
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
| | | | |
| | | | |
Oakley Successor Redevelopment Agency |
Tax Allocation Refunding Bonds Series 2018 | | | | |
Tax Allocation Refunding Bonds Series 2018 | | | | |
Tax Allocation Refunding Bonds Series 2018 | | | | |
Oceanside Successor Redevelopment Agency |
Tax Allocation Refunding Bonds Series 2015A | | | | |
|
| | | | |
|
| | | | |
| | | | |
|
Lease Refunding RB Series 2018 | | | | |
Lease Refunding RB Series 2018 | | | | |
Lease Refunding RB Series 2018 | | | | |
|
| | | | |
| | | | |
| | | | |
|
Wastewater RB Series 2017 | | | | |
|
| | | | |
|
Refunding COP Series 2015A | | | | |
|
| | | | |
| | | | |
Pico Rivera Public Financing Auth |
Lease Refunding RB Series 2016 | | | | |
Lease Refunding RB Series 2016 | | | | |
Pismo Beach Public Fin Auth |
| | | | |
|
| | | | |
|
GO Refunding Bonds Series 2002A | | | | |
|
Intermediate Lien RB Series 2021H | | | | |
Intermediate Lien RB Series 2021H | | | | |
|
Intermediate Lien Refunding RB Series 2021H | | | | |
Intermediate Lien Refunding RB Series 2021H | | | | |
|
| | | | |
| | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
29
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Water Refunding RB Series 2017 | | | | |
Regents of the University of California |
Medical Center Pooled RB Series 2022P | | | | |
Richmond California Redevelopment Agency |
Refunding RB Series 2021A | | | | |
|
Lease Refunding RB Series 2015A | | | | |
Riverside Cnty Transportation Commission |
Toll Road Sr Lien Refunding RB Series 2021B1 | | | | |
Ross Valley Public Financing Auth |
RB (Marin Cnty Sanitary District #1) Series 2013 | | | | |
RB (Marin Cnty Sanitary District #1) Series 2013 | | | | |
Sacramento Area Flood Control Agency |
Consolidated Capital Assessment District No 2 Bonds Series 2016A | | | | |
|
| | | | |
|
Airport System Sr Refunding RB Series 2016A | | | | |
Refunding COP Series 2020 | | | | |
|
| | | | |
San Diego Assoc of Governments |
Capital Grant Receipts RB (Mid Coast Corridor Transit) Series 2019A | | | | |
|
GO Refunding Bonds Series 2024 | | | | |
GO Refunding Bonds Series 2024 | | | | |
|
RB (Sanford Burnham Institute) Series 2015A | | | | |
RB (Sanford Burnham Institute) Series 2015A | | | | |
RB (Sanford Burnham Institute) Series 2015A | | | | |
San Diego Cnty Regional Airport Auth |
| | | | |
Sr Airport RB Series 2023B | | | | |
Sub Airport RB Series 2017B | | | | |
San Diego Public Facilities Financing Auth |
Lease Refunding RB Series 2024A | | | | |
Sub Sewer RB Series 2024A | | | | |
Sub Sewer RB Series 2024A | | | | |
San Diego Unified Port District |
Refunding RB Series 2013A | | | | |
|
| | | | |
San Francisco Airport Commission |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
30
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Refunding RB 2nd Series 2020A | | | | |
Refunding RB 2nd Series 2023C | | | | |
|
| | | | |
San Francisco Redevelopment Agency |
Special Tax Refunding Bonds (Mission Bay South) Series 2023 | | | | |
Special Tax Refunding Bonds (Mission Bay South) Series 2023 | | | | |
San Francisco Successor Redevelopment Agency |
Subordinate Tax Allocation Refunding Bonds Series 2014C | | | | |
Subordinate Tax Allocation Refunding Bonds Series 2014C | | | | |
Subordinate Tax Allocation Refunding Bonds Series 2014C | | | | |
|
| | | | |
San Joaquin Hills Transportation Corridor Agency Toll |
Toll Road Sr Lien Refunding RB Series 2021A | | | | |
|
| | | | |
| | | | |
| | | | |
Santa Cruz Cnty Capital Financing Auth |
| | | | |
| | | | |
| | | | |
Santa Monica Public Financing Auth |
| | | | |
|
| | | | |
ULT GO Bonds Series 2018C | | | | |
Sierra View Healthcare District |
| | | | |
| | | | |
| | | | |
| | | | |
South San Francisco Public Facilities Auth |
| | | | |
|
| | | | |
Southern California Metropolitan Water District |
Water Refunding RB Series 2016A | | | | |
Southern California Public Power Auth |
Refunding RB (Windy Point/Windy Flats) Series 2023-1 | | | | |
Refunding RB (Windy Point/Windy Flats) Series 2023-1 | | | | |
|
Natural Gas Refunding RB Series 2019 | | | | |
Natural Gas Refunding RB Series 2019 | | | | |
Natural Gas Refunding RB Series 2019 | | | | |
Natural Gas Refunding RB Series 2019 | | | | |
|
| | | | |
| | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
31
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Truckee Donner Public Utility District |
Water System Refunding RB Series 2015 | | | | |
Water System Refunding RB Series 2015 | | | | |
Water System Revenue COP Series 2022A | | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
Limited Project RB Series 2017M | | | | |
|
Electric System RB Series 2021A | | | | |
|
| | | | |
|
GO Refunding Bonds Series 2016B | | | | |
GO Refunding Bonds Series 2016B | | | | |
GO Refunding Bonds Series 2016B | | | | |
GO Refunding Bonds Series 2016B | | | | |
| | | | |
|
|
Refunding RB Series 2022A | | | | |
Refunding RB Series 2022A | | | | |
Refunding RB Series 2024A | | | | |
Refunding RB Series 2024A | | | | |
|
Water & Wastewater System Refunding RB Series 2024A | | | | |
Water & Wastewater System Refunding RB Series 2024A | | | | |
| | | | |
|
Puerto Rico Industrial, Tourist, Educational, Medical & Environmental Control Facilities Financing Auth |
Hospital Refunding RB Series 2021 | | | | |
Hospital Refunding RB Series 2021 | | | | |
Hospital Refunding RB Series 2021 | | | | |
Hospital Refunding RB Series 2021 | | | | |
Puerto Rico Sales Tax Financing Corp |
Restructured Sales Tax Bonds Series 2019A1 | | | | |
| | | | |
Total Municipal Securities
(Cost $446,499,911) | |
Total Investments in Securities
(Cost $446,499,911) | |
| The effective maturity may be shorter than the final maturity shown because the security is subject to a put, demand or call feature. |
| Step up bond that pays an initial coupon rate for a set period and increased coupon rates at one or more preset intervals. Rate shown is as of period end. |
| |
32
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab California Tax-Free Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
| Bond currently pays a fixed coupon rate and will be remarketed at a to be determined rate at the end of the current fixed rate term. |
| Credit-enhanced or liquidity-enhanced. |
| VRDN is a municipal security which allows holders to sell their security through a put or tender feature, at par value plus accrued interest. The interest rate resets on a periodic basis, the majority of which are weekly but may be daily or monthly. Unless a reference rate and spread is shown parenthetically, the Remarketing Agent, generally a dealer, determines the interest rate for the security at each interest rate reset date. The rate is typically based on the SIFMA Municipal Swap Index. |
| Security or a portion of the security purchased on a delayed-delivery or when-issued basis. |
| |
| |
| Community college district |
| Certificate of participation |
| |
| |
| |
| |
| |
| Securities Industry and Financial Markets Association. The SIFMA Municipal Swap Index is a market index comprised of high-grade 7-day tax-exempt Variable Rate Demand Obligations with certain characteristics. |
| Union high school district |
| |
| |
| Variable rate demand note |
The following is a summary of the inputs used to value the fund’s investments as of August 31, 2024 (see financial note 2(a) for additional information):
| QUOTED PRICES IN
ACTIVE MARKETS FOR
IDENTICAL ASSETS
(LEVEL 1) | OTHER SIGNIFICANT
OBSERVABLE INPUTS
(LEVEL 2) | SIGNIFICANT
UNOBSERVABLE INPUTS
(LEVEL 3) | |
| | | | |
| | | | |
| | | | |
| As categorized in the Portfolio Holdings. |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
33
Schwab California Tax-Free Bond Fund
Statement of Assets and Liabilities
|
Investments in securities, at value - unaffiliated issuers (cost $446,499,911) | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
Investments bought - delayed-delivery | | |
| | |
Distributions to shareholders | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
Capital received from investors | | |
| | |
| | |
34
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab California Tax-Free Bond Fund
Statement of Operations
For the period September 1, 2023 through August 31, 2024 |
|
Interest received from securities - unaffiliated issuers | | |
|
|
Investment adviser and administrator fees | | |
| | |
Portfolio accounting fees | | |
| | |
| | |
Independent trustees’ fees | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
REALIZED AND UNREALIZED GAINS (LOSSES) |
Net realized losses on sales of securities - unaffiliated issuers | | |
Net change in unrealized appreciation (depreciation) on securities - unaffiliated issuers | | |
Net realized and unrealized gains | | |
Increase in net assets resulting from operations | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
35
Schwab California Tax-Free Bond Fund
Statement of Changes in Net Assets
For the current and prior report periods
|
| | |
| | | |
| | | |
Net change in unrealized appreciation (depreciation) | | | |
Increase in net assets resulting from operations | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS |
| | | |
TRANSACTIONS IN FUND SHARES |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Net transactions in fund shares | | | | | |
|
SHARES OUTSTANDING AND NET ASSETS |
| | |
| | | | | |
| | | | | |
Total increase (decrease) | | | | | |
| | | | | |
36
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Financial Statements
| | | | | | |
|
Net asset value at beginning of period | | | | | | |
Income (loss) from investment operations: | | | | | | |
Net investment income (loss)3 | | | | | | |
Net realized and unrealized gains (losses) | | | | | | |
Total from investment operations | | | | | | |
| | | | | | |
Distributions from net investment income | | | | | | |
Distributions from net realized gains | | | | | | |
| | | | | | |
| | | | | | |
Net asset value at end of period | | | | | | |
| | | | | | |
|
Ratios to average net assets: | | | | | | |
| | | | | | |
| | | | | | |
Net investment income (loss) | | | | | | |
| | | | | | |
Net assets, end of period (x 1,000) | | | | | | |
| Effective July 1, 2021, the Schwab High Yield Municipal Bond Fund changed its name to Schwab Opportunistic Municipal Bond Fund. |
| Effective August 10, 2020, the Wasmer Schroeder High Yield Municipal Fund was reorganized into the Schwab Opportunistic Municipal Bond Fund (formerly, Schwab High Yield Municipal Bond Fund), which commenced operations on that day. The Financial Highlights above present the shares of the Wasmer Schroeder High Yield Municipal Fund prior to the acquisition date of August 10, 2020, and Schwab Opportunistic Municipal Bond Fund subsequent to that date. |
| Calculated based on the average shares outstanding during the period. |
| Includes a special payment of past due interest income received from defaulted securities. The per share effect on net investment income and distributions from net investment income was $0.27 and ($0.27), respectively, and effect on net investment income to average net assets was 2.77% (see financial note 2(d) for additional information). |
| Effective July 1, 2021, redemption fees were eliminated. |
| Amount is less than $0.01 per share. |
| |
| Ratio includes less than 0.005% of non-routine proxy expenses. |
| Effective July 1, 2021, the net operating expense limitation was lowered from 0.60% to 0.50%. The ratio presented for the year ended August 31, 2021, is a blended ratio. |
| |
| Effective August 10, 2020, the net operating expense limitation was lowered from 0.75% to 0.60%. The ratio presented for the period ended August 31, 2020, is a blended ratio. |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
37
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024
For fixed rate securities, the rate shown is the interest rate (the rate established when the security was issued). For variable rate securities, the rate shown is the rate as of the report date based on each security’s rate reset date. The reference rate and spread used is shown parenthetically in the security description, if available; if not, the reference rate is described in a footnote. The maturity date shown for all the securities is the final legal maturity.
ISSUER TYPE OF SECURITY, SERIES | | | | |
MUNICIPAL SECURITIES 102.0% OF NET ASSETS |
|
Black Belt Energy Gas District |
| | | | |
| | | | |
Energy Southeast Cooperative District |
Energy Supply RB Series 2023B1 | | | | |
|
Sewer RB Warrants Series 2024 | | | | |
| | | | |
|
|
| | | | |
La Paz Cnty Industrial Development Auth |
Education Facility Lease RB (Harmony Public Schools) Series 2018A | | | | |
| | | | |
|
Burbank Glendale Pasadena Airport Auth |
Sr Airport RB Series 2024B | | | | |
|
| | | | |
| | | | |
California Community Choice Financing Auth |
RB (Deutsche Bank) Series 2023C | | | | |
| | | | |
California Educational Facilities Auth |
RB (St Marys College) Series 2023A | | | | |
California Health Facilities Financing Auth |
RB (Episcopal Communities & Services) Series 2024B | | | | |
California Municipal Finance Auth |
Mobile Home Park Sr RB (Caritas Projects) Series 2024A | | | | |
California Pollution Control Financing Auth |
Solid Waste Disposal RB (Republic Services Inc) Series 2017 | | | | |
California Public Finance Auth |
RB (Henry Mayo Newhall Hospital) Series 2021A | | | | |
California Public Works Board |
| | | | |
California School Finance Auth |
RB (Granada Hills Charter) Series 2024A | | | | |
RB (Granada Hills Charter) Series 2024A | | | | |
|
| | | | |
38
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Los Angeles Dept of Airports |
| | | | |
|
GO Refunding Bonds Series 2024A | | | | |
|
| | | | |
San Diego Cnty Regional Airport Auth |
Sr Airport RB Series 2023B | | | | |
Sub Airport RB Series 2021B | | | | |
Southern California Public Power Auth |
Clean Energy Project RB Series 2024A | | | | |
|
| | | | |
| | | | |
|
Colorado Bridge Enterprise IRB |
| | | | |
Colorado Educational & Cultural Facilities Auth |
Charter School RB (Loveland Classical Schools) Series 2023 | | | | |
Colorado Health Facilities Auth |
RB (CommonSpirit Health) Series 2019A1 | | | | |
RB (CommonSpirit Health) Series 2019A1 | | | | |
RB (CommonSpirit Health) Series 2024A | | | | |
RB (Intermountain Healthcare) Series 2022A | | | | |
Refunding RB (Children’s Hospital Colorado) Series 2020A | | | | |
Refunding RB (Intermountain Healthcare) Series 2019A | | | | |
|
Airport System RB Series 2022A | | | | |
Whispering Pines Metropolitan District #1 |
LT GO Refunding Bonds Series 2023 | | | | |
| | | | |
|
|
| | | | |
DISTRICT OF COLUMBIA 0.8% |
Metropolitan Washington Airports Auth |
Airport System Refunding RB Series 2024A | | | | |
Sr Lien Refunding RB (Dulles Metrorail) Series 2019A | | | | |
| | | | |
|
Florida Development Finance Corp |
Healthcare Facilities RB (Tampa General Hospital) Series 2024A | | | | |
RB (Brightline Trains) Series 2024 | | | | |
|
| | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
39
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Health System RB (Baycare Health) Series 2024C | | | | |
|
Hospital Refunding RB (Lakeland Regional Health Systems) Series 2024 | | | | |
Lee Cnty Industrial Development Auth |
Healthcare Facilities Improvement RB (Shell Point Alliance) Series 2019 | | | | |
Healthcare Facilities RB (Shell Point Obligated Group) Series 2024A | | | | |
Healthcare Facilities RB (Shell Point Obligated Group) Series 2024B1 | | | | |
|
Aviation Refunding RB Series 2024A | | | | |
|
| | | | |
|
Hospital RB (H Lee Moffitt Cancer Center) Series 2020B | | | | |
Village Community Dev Dist. No.15 |
| | | | |
| | | | |
|
Brookhaven Public Facilities Auth |
RB (Childrens Healthcare of Atlanta Inc) Series 2019A | | | | |
Columbia Cnty Hospital Auth |
Revenue Anticipation Certificates (Wellstar Health System) Series 2023A | | | | |
Main Street Natural Gas Inc |
Gas Supply RB Series 2023D | | | | |
| | | | |
|
|
Water & Wastewater System Refunding RB Series 2024A | | | | |
|
Honolulu City & Cnty Board |
Water System RB Series 2022A | | | | |
|
Idaho Housing & Finance Assoc |
Facilities RB (White Pine Charter School) Series 2023A | | | | |
Facilities RB (White Pine Charter School) Series 2023A | | | | |
| | | | |
|
|
2nd Lien Water Refunding RB Series 2023B | | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
40
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Chicago Board of Education |
ULT GO Bonds Series 2023A | | | | |
Chicago O’Hare International Airport |
OHare General Airport Sr Lien RB Series 2022A | | | | |
OHare General Airport Sr Lien RB Series 2024A | | | | |
|
LT GO Refunding Bonds Series 2023 | | | | |
|
| | | | |
| | | | |
| | | | |
| | | | |
GO Bonds Series May 2024B | | | | |
|
Clean Water Revolving Fund RB Series 2016 | | | | |
RB (DePaul Univ) Series 2016 | | | | |
RB (OSF Healthcare System) Series 2015A | | | | |
Refunding RB (Northwestern Memorial Healthcare) Series 2021A | | | | |
Illinois Toll Highway Auth |
Toll Highway Sr RB Series 2015A | | | | |
Metropolitan Pier & Exposition Auth |
Refunding Bonds Series 2010B-1 | | | | |
|
Auxiliary Facilities System Refunding RB Series 2024A | | | | |
| | | | |
|
|
Economic Development RB (Republic Services Inc) Series 2012 | | | | |
Economic Development Refunding RB (Republic Services Inc) Series 2010A | | | | |
| | | | |
|
|
Hospital Refunding RB (Univ of Iowa Hospitals & Clinics) Series 2022C | | | | |
|
Health Facilities RB (UnityPoint Health) Series 2014C | | | | |
| | | | |
|
Kentucky Public Energy Auth |
Gas Supply RB (Morgan Stanley) Series 2019A1 | | | | |
|
| | | | |
| | | | |
|
Louisiana Housing Corp M/F Revenue |
S/F Mortgage RB Series 2023C | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
41
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Louisiana Stadium & Exposition District |
| | | | |
|
Sewerage Service RB Series 2015 | | | | |
| | | | |
|
Maine Health & Educational Facilities Auth |
RB (Maine Health) Series 2023B | | | | |
|
Maryland Economic Development Corp |
Refunding RB (Transportation Facilities) Series 2017A | | | | |
Maryland Health & Higher Educational Facilities Auth |
RB (Frederick Health System) Series 2023 | | | | |
| | | | |
|
|
| | | | |
Massachusetts Development Finance Agency |
RB (Boston Medical Center) Series 2023G | | | | |
RB (Emerson College) Series 2018 | | | | |
| | | | |
|
|
| | | | |
|
| | | | |
Minneapolis- St. Paul Metropolitan Airports Commission |
Sub Airport RB Series 2024B | | | | |
South Central Minnesota Multi-Cnty Hsg & Redevelopment Auth |
Pooled Housing Development RB Series 1993 | | | | |
Pooled Housing Development RB Series 1993 | | | | |
Pooled Housing Development RB Series 1993 | | | | |
Pooled Housing Development RB Series 1993 | | | | |
Pooled Housing Development RB Series 1993 | | | | |
Pooled Housing Development RB Series 1993 | | | | |
Pooled Housing Development RB Series 1993 | | | | |
Pooled Housing Development RB Series 1993 | | | | |
| | | | |
|
Mississippi Business Finance Corp |
Gulf Opportunity Zone IDRB (Chevron) Series 2011E | | | | |
42
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
|
Airport Special Obligation Bonds Series 2020A | | | | |
Lambert-St Louis International Airport |
| | | | |
Missouri Health & Educational Facilities Auth |
Sr Living Facilities RB (Lutheran Sr Services) Series 2024A | | | | |
St Louis Board of Education |
| | | | |
| | | | |
|
|
Hospital Refunding RB (Carson Tahoe Regional Healthcare) Series 2017 | | | | |
|
Airport System Jr Lien Sub RB Series 2021B | | | | |
| | | | |
|
New Jersey Economic Development Auth |
State Lease RB Series 2017B | | | | |
New Jersey Transportation Trust Fund Auth |
Transportation Bonds Series 2023BB | | | | |
Transportation RB Series 2020AA | | | | |
Transportation System Bonds Series 2019A | | | | |
|
| | | | |
Tobacco Settlement Financing Corp |
Tobacco Settlement Bonds Series 2018A | | | | |
| | | | |
|
Metropolitan Transportation Auth |
Transportation RB Series 2020C1 | | | | |
Transportation Refunding RB Series 2024A | | | | |
|
GO Bonds Fiscal 2018 Series B4 | | | | |
GO Bonds Fiscal 2020 Series B1 | | | | |
GO Bonds Fiscal 2021 Series F1 | | | | |
GO Bonds Fiscal 2022 Series A1 | | | | |
GO Bonds Fiscal 2022 Series D1 | | | | |
GO Bonds Fiscal 2025 Series A | | | | |
New York City Municipal Water Finance Auth |
Water & Sewer System 2nd General Resolution RB Fiscal 2022 Series BB1 | | | | |
Water & Sewer System 2nd General Resolution RB Fiscal 2024 Series CC1 | | | | |
New York City Transitional Finance Auth |
Building Aid RB Fiscal 2021 Series S1 | | | | |
Future Tax Secured Sub Bonds Fiscal 2020 Series A2 | | | | |
Future Tax Secured Sub Bonds Fiscal 2022 Series C1 | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
43
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Future Tax Secured Sub Bonds Fiscal 2023 Series A1 | | | | |
Future Tax Secured Sub Bonds Fiscal 2024 Series B | | | | |
Future Tax Secured Sub Bonds Fiscal 2024 Series G1 | | | | |
New York State Dormitory Auth |
RB (New York Institute of Technology) Series 2024 | | | | |
RB (New York Institute of Technology) Series 2024 | | | | |
State Personal Income Tax RB Series 2017A | | | | |
State Personal Income Tax RB Series 2024A | | | | |
New York Transportation Development Corp |
Special Facilities RB (JFK Airport - New Terminal 1) Series 2023 | | | | |
Special Facilities RB (JFK Airport - New Terminal 1) Series 2024 | | | | |
Triborough Bridge & Tunnel Auth |
Sales Tax RB Series 2023A | | | | |
Westchester Cnty Local Development Corp |
RB (New York Blood Center) Series 2024 | | | | |
| | | | |
|
|
Utility System RB Series 2024 | | | | |
Greater Asheville Regional Airport Auth |
Airport System RB Series 2022A | | | | |
North Carolina Medical Care Commission Retirement Facilities |
Retirement Facilities 1st Mortgage RB (Carolina Meadows) Series 2024 | | | | |
Retirement Facilities 1st Mortgage RB (United Methodist Retirement Homes) Series 2024A | | | | |
|
Enterprise System RB Series 2024 | | | | |
| | | | |
|
|
ULT GO Bonds Series 2017A | | | | |
|
RB (Univ of Cincinnati) Series 2024A | | | | |
| | | | |
|
Oklahoma Development Finance Auth |
Health System RB (OU Medicine) Series 2018B | | | | |
|
General Refunding RB Series 2024A | | | | |
| | | | |
|
Astoria Hospital Facilities Auth |
RB (Columbia Memorial Hospital) Series 2024 | | | | |
|
| | | | |
44
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
| | | | |
| | | | |
|
Commonwealth Financing Auth |
Tobacco Settlement RB Series 2018 | | | | |
Pennsylvania State Turnpike Commission |
| | | | |
Turnpike Sub RB Series 2015A1 | | | | |
| | | | |
|
Puerto Rico Sales Tax Financing Corp |
Restructured Sales Tax Bonds Series 2019A1 | | | | |
|
Rhode Island Health & Educational Building Corp |
Higher Education Facility RB (Bryant Univ) Series 2024 | | | | |
Hospital Financing RB (Lifespan Obligated Group) Series 2024 | | | | |
Hospital Financing RB (Lifespan Obligated Group) Series 2024 | | | | |
| | | | |
|
South Carolina Jobs Economic Development Auth |
Health Care Facilities RB (Novant Health) Series 2024A | | | | |
South Carolina Public Service Auth |
| | | | |
| | | | |
Refunding RB Series 2016B | | | | |
| | | | |
|
Chattanooga Health Educational & Housing Facilities Board |
Student Housing Refunding RB (CDFI Univ of Tennessee at Chattanooga) Series 2015 | | | | |
Metro Government of Nashville & Davidson Cnty Health & Educational Facilities Board |
Educational Facilities RB (Belmont Univ) Series 2023 | | | | |
Metropolitan Nashville Airport Auth |
| | | | |
Tennessee Housing Development Agency Home Ownership |
Residential Finance Program Bonds Series 2023-3A | | | | |
| | | | |
|
|
| | | | |
|
Go Revenue & Refunding Bonds Series 2024 | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
45
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
Arlington Higher Education Finance Corp |
Education RB (Harmony Public Schools) Series 2024 | | | | |
|
| | | | |
City of Galveston Wharves & Terminal Revenue |
| | | | |
|
Sr Lien Utility System Refunding RB Series 2024 | | | | |
|
| | | | |
Sr Lien Special Tax RB (Dallas Fair Park) Series 2023 | | | | |
El Paso Cnty Hospital District |
GO Refunding Bonds Series 2017 | | | | |
GO Refunding Bonds Series 2017 | | | | |
|
Electric Utility System Refunding RB Series 2023 | | | | |
|
ULT GO Bonds Series 2023A | | | | |
|
| | | | |
Greater Texoma Utility Auth |
| | | | |
|
Toll Road 1st Lien Refunding RB Series 2024A | | | | |
|
GO Refunding Bonds Series 2024A | | | | |
Utility System 1st Lien Refunding RB Series 2024A | | | | |
|
Water & Wastewater System RB Series 2018 | | | | |
|
Electric Light & Power System Refunding RB Series 2023 | | | | |
Martin Cnty Hospital District |
GO Refunding Bonds Series 2021 | | | | |
Midland Cnty Texas Hospital District |
| | | | |
Mission Tex Economic Dev Corp |
Solid Waste Disposal RB (Waste Managemnet Inc) Series 2020A | | | | |
New Hope Cultural Educational Facilities Corp |
Education RB (Beta Academy) Series 2019A | | | | |
Newark Higher Education Finance Corp |
Education RB (Orenda) Series 2023A | | | | |
|
| | | | |
|
Electric & Gas System Refunding RB Series 2024C | | | | |
Electric & Gas Systems Refunding RB Series 2023B | | | | |
| | | | |
Tarrant Regional Water District |
Water Revenue & Refunding Bonds Series 2024 | | | | |
46
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
|
Tax & Waterworks & Sewer System GO RB Series 2023C | | | | |
Texas Municipal Gas Corp III |
Gas Supply Refunding RB Series 2021 | | | | |
Texas Transportation Corp |
Sr Lien RB (NTE Mobility Partners) Series 2023 | | | | |
|
Refunding RB Series 2024A | | | | |
| | | | |
|
|
| | | | |
| | | | |
|
General RB (Univ of Utah) Series 2022A | | | | |
| | | | |
|
|
Health Care RB (Inova Health System) Series 2024 | | | | |
Lynchburg Economic Development Auth |
Hospital Refunding RB (Centra Health) Series 2021 | | | | |
| | | | |
|
|
Water & Sewer Refunding RB Series 2023A | | | | |
Port Vancouver Washington |
| | | | |
Skagit Cnty Hospital District No 1 |
| | | | |
Three Rivers Regional Wastewater Auth |
Wastewater RB Series 2024 | | | | |
| | | | |
|
West Virginia Hospital Finance Auth |
Hospital Revenue & Refunding Bonds (Vandalia Health) Series 2023B | | | | |
|
Wisconsin Health & Educational Facilities Auth |
RB (Ascension Health) Series 2016A | | | | |
RB (Fort HealthCare Inc) Series 2024A | | | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
47
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
ISSUER TYPE OF SECURITY, SERIES | | | | |
RB (Fort HealthCare Inc) Series 2024A | | | | |
RB (Woodland Hill Sr Housing) Series 2014 | | | | |
| | | | |
Total Municipal Securities
(Cost $67,642,639) | |
Total Investments in Securities
(Cost $67,642,639) | |
| The effective maturity may be shorter than the final maturity shown because the security is subject to a put, demand or call feature. |
| Security or a portion of the security purchased on a delayed-delivery or when-issued basis. |
| |
| Credit-enhanced or liquidity-enhanced. |
| VRDN is a municipal security which allows holders to sell their security through a put or tender feature, at par value plus accrued interest. The interest rate resets on a periodic basis, the majority of which are weekly but may be daily or monthly. Unless a reference rate and spread is shown parenthetically, the Remarketing Agent, generally a dealer, determines the interest rate for the security at each interest rate reset date. The rate is typically based on the SIFMA Municipal Swap Index. |
| Bond currently pays a fixed coupon rate and will be remarketed at a to be determined rate at the end of the current fixed rate term. |
| The underlying properties were sold and the bond trustee collected sales proceeds from the underlying properties. A substantial distribution to bond holders occurred on April 14, 2023, with a residual distribution to be paid in 2025. There were no distributions made to bondholders during the period ended August 31, 2024. Due to the sale of the underlying properties, accruals for interest were suspended. Previously, the securities were making semiannual distributions of variable amounts of cash flow. The residual distribution payment to be made to bond holders in 2025 consists of county tax levy deficit payments collected and to be collected by the bond trustee through the end of 2024 less trust operating, administration, and legal expenses in liquidating the trust. |
| Fair valued using significant unobservable inputs (see financial note 2(a), Securities for which no quoted value is available, for additional information). |
| Community college district |
| Certificate of participation |
| |
| Industrial development agency/authority |
| Industrial development revenue bond |
| |
| Independent school district |
| |
| |
| |
| |
| |
| |
| |
| Variable rate demand note |
The following is a summary of the inputs used to value the fund’s investments as of August 31, 2024 (see financial note 2(a) for additional information):
| QUOTED PRICES IN
ACTIVE MARKETS FOR
IDENTICAL ASSETS
(LEVEL 1) | OTHER SIGNIFICANT
OBSERVABLE INPUTS
(LEVEL 2) | SIGNIFICANT
UNOBSERVABLE INPUTS
(LEVEL 3) | |
| | | | |
| | | | |
| | | | |
| | | | |
| As categorized in the Portfolio Holdings. |
48
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Portfolio Holdings as of August 31, 2024 (continued)
The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:
| | | | | | | NET CHANGE IN
UNREALIZED
APPRECIATION
(DEPRECIATION) | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
The Level 3 securities held are valued utilizing an evaluated price from a third-party vendor pricing service using significant unobservable inputs. A significant change in third-party pricing information may result in a lower or higher value for Level 3
investments (see financial note 2(a), Securities for which no quoted value is available, for additional information).
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
49
Schwab Opportunistic Municipal Bond Fund
Statement of Assets and Liabilities
|
Investments in securities, at value - unaffiliated issuers (cost $67,642,639) | | |
| | |
| | |
| | |
| | |
| | |
| | |
|
|
| | |
Investments bought - delayed-delivery | | |
| | |
Distributions to shareholders | | |
| | |
| | |
| | |
| | |
| | |
|
|
Capital received from investors | | |
| | |
| | |
50
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Opportunistic Municipal Bond Fund
Statement of Operations
For the period September 1, 2023 through August 31, 2024 |
|
Interest received from securities - unaffiliated issuers | | |
|
|
Investment adviser and administrator fees | | |
Portfolio accounting fees | | |
| | |
| | |
Independent trustees’ fees | | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
|
REALIZED AND UNREALIZED GAINS (LOSSES) |
Net realized losses on sales of securities - unaffiliated issuers | | |
Net change in unrealized appreciation (depreciation) on securities - unaffiliated issuers | | |
Net realized and unrealized gains | | |
Increase in net assets resulting from operations | | |
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
51
Schwab Opportunistic Municipal Bond Fund
Statement of Changes in Net Assets
For the current and prior report periods
|
| | |
| | | |
| | | |
Net change in unrealized appreciation (depreciation) | | | |
Increase in net assets resulting from operations | | | |
|
DISTRIBUTIONS TO SHAREHOLDERS |
| | | |
TRANSACTIONS IN FUND SHARES |
| | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Net transactions in fund shares | | | | | |
|
SHARES OUTSTANDING AND NET ASSETS |
| | |
| | | | | |
| | | | | |
Total increase (decrease) | | | | | |
| | | | | |
| Includes a special payment of past due interest income received from defaulted securities (see financial note 2(d) for additional information). |
52
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Municipal Bond Funds
1. Business Structure of the Funds:
Each of the funds in this report is a series of Schwab Investments (the trust), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the 1940 Act). The list below shows all the funds in the trust as of the end of the period, including the funds discussed in this report, which are highlighted:
|
Schwab Tax-Free Bond Fund | Schwab U.S. Aggregate Bond Index Fund |
Schwab California Tax-Free Bond Fund | Schwab Short-Term Bond Index Fund |
Schwab Opportunistic Municipal Bond Fund | |
Schwab Treasury Inflation Protected Securities Index Fund | Schwab Global Real Estate Fund |
Each fund in this report offers one share class. Shares are bought and sold at closing net asset value per share (NAV), which is the price for all outstanding shares of a fund. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the Board) may authorize the issuance of as many shares as necessary.
Each fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, each fund may also keep certain assets in segregated accounts, as required by securities law. The "Fund Complex" includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust and Laudus Trust.
The Schwab Tax-Free Bond Fund seeks high current income that is exempt from federal income tax, consistent with capital preservation. The fund normally invests at least 80% of its net assets (including, for this purpose, any borrowings for investment purposes) in municipal securities the interest from which is exempt from federal income tax, including the federal alternative minimum tax.
The Schwab California Tax-Free Bond Fund seeks high current income exempt from federal and California personal income tax that is consistent with capital preservation. The fund normally invests at least 80% of its net assets (including, for this purpose, any borrowings for investment purposes) in municipal securities the interest from which is exempt from federal and California personal income tax and federal alternative minimum tax.
The Schwab Opportunistic Municipal Bond Fund seeks to generate interest income that is not subject to federal income tax. Under normal market conditions, the fund invests at least 80% of its net assets (including, for this purpose, any borrowings for investment purposes) in municipal securities that pay interest not subject to regular federal income tax.
2. Significant Accounting Policies:The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The funds follow the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 Financial Services — Investment Companies. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (GAAP).
Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated authority to a Valuation Designee, the funds’ investment adviser, to make fair valuation determinations under adopted procedures, subject to Board oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities as well as to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.
Securities held in the funds’ portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:
● Bonds and notes: Fixed income investments are generally valued using an evaluated price at the mid-point of the bid/ask spread provided by an approved, independent pricing service (mid-price). To determine the evaluated mid-price, a pricing service may use a variety of techniques and inputs. Techniques may include, but are not limited to, spread models that
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
53
Schwab Municipal Bond Funds
Financial Notes (continued)
2. Significant Accounting Policies (continued):
calculate an investment-specific price relative to a benchmark or yield curve models that establish a price based on yields of comparable bonds along a range of maturities. Inputs differ by valuation approach and techniques, as appropriate, and examples of inputs may include, but are not limited to, interest rates, market conditions, comparable bonds, market trades, projected cash flows, credit reviews and issuer news.
● Short-term securities (60 days or less to maturity): Securities with remaining maturities of 60 days or less are generally valued at an evaluated price; however, such securities may be valued at their amortized cost if it approximates the security’s fair value.
● Securities for which no quoted value is available: The Valuation Designee has adopted procedures to fair value a fund’s securities when market prices are not “readily available” or are unreliable. For example, a security may be fair valued when it’s de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security.
In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee’s judgment will be required to estimate fair value.
The three levels of the fair value hierarchy are as follows:
● Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets. These generally include active listed equities, mutual funds, exchange-traded funds (ETFs) and futures contracts. Mutual funds and ETFs are classified as Level 1 prices, without consideration to the classification level of the underlying securities held which could be Level 1, Level 2 or Level 3 in the fair value hierarchy.
● Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include forward foreign currency exchange contracts, U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations.
● Level 3 — significant unobservable inputs (including the Valuation Designee’s assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore a fund’s results of operations.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The levels associated with valuing the funds’ investments as of August 31, 2024, are disclosed in each fund’s Portfolio Holdings.
54
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Municipal Bond Funds
Financial Notes (continued)
2. Significant Accounting Policies (continued):
(b) Accounting Policies for certain Portfolio Investments (if held):
Futures Contracts: Futures contracts are instruments that represent an agreement between two parties that obligates one party to buy, and the other party to sell, specific instruments at an agreed upon price on a stipulated future date. A fund must give the broker a deposit of cash and/or securities (initial margin) whenever it enters into a futures contract. The amount of the deposit may vary from one contract to another. Subsequent payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized appreciation or depreciation until the contract is closed, at which time the gains or losses are realized. Futures contracts are traded publicly on exchanges, and their value may change daily.
Delayed-Delivery Transactions and When-Issued Securities: The funds may transact in securities on a delayed-delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The securities purchased on a delayed-delivery or when-issued basis are identified as such in the funds’ Portfolio Holdings, if any. The funds may receive compensation for interest forgone in the purchase of a delayed-delivery or when-issued security. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract’s terms, or if the issuer does not issue the securities due to political, economic, or other factors. The funds comply with Rule 18f-4 under the 1940 Act, the funds operate as limited derivatives users, with respect to purchase commitments held within the funds, portfolio securities are no longer required to be segregated as collateral with a value at least equal to the amount of a purchase commitment and the funds’ exposure is monitored under a derivatives risk management program.
(c) Security Transactions:
Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from security transactions are based on the identified costs of the securities involved.
When a fund closes out a futures contract position, it calculates the difference between the value of the position at the beginning and at the end of the contract, and records a realized gain or loss accordingly.
Interest income is recorded as it accrues. If a fund buys a debt security at a discount (less than face value) or a premium (more than face value), it amortizes premiums and accretes discounts from the purchase settlement date up to maturity. The fund then increases (in the case of discounts) or reduces (in the case of premiums) the income it records from the security. Certain securities may be callable (meaning that the issuer has the option to pay it off before its maturity date). The fund amortizes the premium and accretes the discount on each callable security to the security’s maturity date, except when the purchase price is higher than the call price at the security’s call date (in which case the premium is amortized to the call date). Debt securities may be placed on non-accrual status and set to accrue at a rate of interest less than the contractual coupon or have the interest receivable written off when the collection of all or a portion of interest has become doubtful.
The Schwab Opportunistic Municipal Bond Fund holds Southcentral Minnesota Multi-County Housing and Redevelopment Authority (Southcentral) bonds which were received in-kind by the Wasmer Schroeder High Yield Municipal Fund (predecessor fund) in 2014 when the predecessor fund commenced investment operations. The Southcentral bonds were purchased as distressed debt instruments in default (as the bonds were not making full payments of interest and principal when due at the time of purchase) prior to the transfer in-kind to the predecessor fund. During the period ended August 31, 2023, the underlying properties that represented collateral for the Southcentral bonds were sold; the proceeds from the sale of collateral were collected by the bond trustee which resulted in a distribution payment to bondholders. The fund received an aggregate distribution payment of $3,817,109 for past due interest coupons and principal payments. The distribution consisted of past due unpaid interest income of $1,116,060, and the fund’s shareholders received an income distribution payment of the past due interest income in April 2023 in the amount of $1,116,060 which represented $0.27 per share on record date. There were no distributions made to bondholders during the period ended August 31, 2024. Additional information is included in the fund’s Portfolio Holdings.
Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to more than one fund in the trusts generally are allocated among those funds in proportion to their average daily net assets.
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
55
Schwab Municipal Bond Funds
Financial Notes (continued)
2. Significant Accounting Policies (continued):
(f) Distributions to Shareholders:
The funds, except Schwab Opportunistic Municipal Bond Fund, declare distributions from net investment income, if any, every day they are open for business. These distributions, which are substantially equal to a fund’s net investment income for that day, are paid out to shareholders once a month. The Schwab Opportunistic Municipal Bond Fund declares and pays its dividends on the last business day of every month, based on its determination of net investment income, if any. The funds make distributions from net realized capital gains, if any, once a year. To receive a distribution, you must be a registered shareholder on the record date. Distributions are paid to shareholders on the payable date.
(g) Accounting Estimates:
The accounting policies described in this report conform to GAAP. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has to make estimates and assumptions that affect the information reported in the financial statements. It’s possible that once the results are known, they may turn out to be different from these estimates and these differences may be material.
(h) Federal Income Taxes:
The funds intend to meet federal income and excise tax requirements for regulated investment companies under subchapter M of the Internal Revenue Code, as amended. Accordingly, the funds distribute substantially all of their net investment income and net realized capital gains, if any, to their respective shareholders each year. As long as a fund meets the tax requirements, it is not required to pay federal income tax.
Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.
3. Credit and Liquidity Enhancements:A portion of the funds’ investments are in securities with credit enhancements and/or liquidity enhancements from financial institutions or corporations. These enhancements are employed by the issuers of the securities to reduce credit risk and/or provide liquidity to the purchaser. At August 31, 2024, as a percentage of the total assets, the Schwab Tax-Free Bond Fund, Schwab California Tax-Free Bond Fund, and Schwab Opportunistic Municipal Bond Fund held less than 10% of total assets in these types of securities.
The funds invest primarily in investment-grade municipal bond securities. These investments may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below:
Market Risk. Financial markets rise and fall in response to a variety of factors, sometimes rapidly and unpredictably. Markets may be impacted by economic, political, regulatory and other conditions, including economic sanctions and other government actions. In addition, the occurrence of global events, such as war, terrorism, environmental disasters, natural disasters and epidemics, may also negatively affect the financial markets. As with any investment whose performance is tied to these markets, the value of an investment in a fund will fluctuate, which means that an investor could lose money over short or long periods.
Management Risk. As actively managed mutual funds, the funds are subject to the risk that their investment adviser will select investments or allocate assets in a manner that could cause a fund to underperform or otherwise not meet its investment objective. The funds’ investment adviser applies its own investment techniques and risk analyses in making investment decisions for each fund, but there can be no guarantee that they will produce the desired results.
56
Schwab Municipal Bond Funds | Annual Holdings and Financial Statements
Schwab Municipal Bond Funds
Financial Notes (continued)
4. Risk Factors (continued):
Investment Style Risk. The funds are not designed to offer substantial capital appreciation. In exchange for its goal of capital preservation, a fund may offer lower long-term performance than stock investments or certain other types of bond investments. A fund’s emphasis on quality and preservation of capital also could cause it to underperform certain other types of bond investments, particularly those that take greater maturity and credit risks. At the same time, some of the funds’ investments may have greater risks than investments in some taxable bonds.
Municipal Securities Risk. The funds primarily invest in municipal securities whose interest, in the opinion of the issuers’ counsel, is exempt from federal income tax and from the AMT. Neither the investment adviser nor the funds guarantee that this opinion is correct, and there is no assurance that the Internal Revenue Service (IRS) will agree with such counsel’s opinion. If certain types of investments a fund buys as tax-exempt are later ruled to be taxable, a portion of the fund’s income could be taxable. To the extent that a fund invests in municipal securities from a given state or geographic region, its share price and performance could be affected by local, state and regional factors, including erosion of the tax base and changes in the economic climate. In addition, many municipal securities are issued to finance specific projects (especially those relating to education, health care, transportation and utilities) and conditions in those sectors can affect the overall municipal market. National governmental actions, such as the elimination of tax-exempt status, or the reduction of financial support to municipalities, also could affect performance. Municipalities continue to experience difficulties in the current economic and political environment.
Interest Rate Risk. Interest rates rise and fall over time. As with any investment whose yield reflects current interest rates, a fund’s yield will change over time. During periods when interest rates are low, a fund’s yield (and total return) also may be low. Changes in interest rates also may affect a fund’s share price: a rise in interest rates generally causes a fund’s share price to fall. The longer a fund’s portfolio duration, the more sensitive to interest rate movements its share price is likely to be. Also, a change in a central bank’s monetary policy or economic conditions, among other things, may result in a change in interest rates, which could have sudden and unpredictable effects on the markets and significantly impact the value of fixed-income securities in which a fund invests. A sudden or unpredictable rise in interest rates may cause volatility and the value of fixed-income securities to decline.
Credit Risk. A decline in the credit quality of an issuer, guarantor or liquidity provider of a portfolio investment or a counterparty could cause the funds to lose money or underperform. The funds could lose money if, due to a decline in credit quality, the issuer, guarantor or liquidity provider of a portfolio investment or a counterparty fails to make, or is perceived as being unable or unwilling to make, timely principal or interest payments or otherwise honor its obligations.
Liquidity Risk. The funds may be unable to sell certain securities, such as illiquid securities, readily at a favorable time or price, or the funds may have to sell them at a loss.
High-Yield Risk. High-yield securities and unrated securities of similar credit quality (junk bonds) are subject to greater levels of credit and liquidity risks, and may be more volatile than higher-rated securities. High-yield securities are considered predominately speculative with respect to the issuer’s continuing ability to make principal and interest payments.
Prepayment and Extension Risk. Certain fixed-income securities are subject to the risk that the securities may be paid off earlier or later than expected, especially during periods of falling or rising interest rates, respectively. Prepayments of obligations could cause a fund to forgo future interest income on the portion of the security’s principal repaid early and force the fund to reinvest that money at the lower prevailing interest rates. Extensions of obligations could cause a fund to exhibit additional volatility and hold securities paying lower-than-market rates of interest. Either case could hurt a fund’s performance.
Derivatives Risk. Currently, the only type of derivatives the funds invest in is futures. A future is an agreement to buy or sell a financial instrument at a specific price on a specific day. A fund’s use of futures involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Certain of these risks, such as liquidity risk, credit risk, market risk and management risk, are discussed elsewhere in this section. A fund’s use of futures is also subject to lack of availability risk, valuation risk, correlation risk and tax risk. Lack of availability risk is the risk that suitable futures transactions may not be available in all circumstances for risk management or other purposes. Valuation risk is the risk that a particular future may be valued incorrectly. Correlation risk is the risk that changes in the value of the future may not correlate perfectly with the underlying asset, rate or index. Tax risk is the risk that the use of futures may cause a fund to realize higher amounts of short-term capital gains. A fund’s use of derivatives could reduce the fund’s performance, increase the fund’s volatility, and cause the fund to lose more than the initial amount invested. However, these risks are less severe when a fund uses derivatives for hedging rather than to enhance the fund’s returns or as a substitute for a position or security. The use of derivatives that are subject to regulation by the Commodity Futures Trading Commission (CFTC) could cause a fund to become a commodity pool, which would require the
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Schwab Municipal Bond Funds
Financial Notes (continued)
4. Risk Factors (continued):
fund to comply with certain CFTC rules. A fund’s use of derivatives also could create a risk of counterparty default under certain transactions, risks that the fund would need to liquidate portfolio positions when it may not be advantageous to do so in order to meet margin and payment obligations, and legal risks relating to insufficient documentation, insufficient capacity or authority of a counterparty, or legality or enforceability of a contract.
Distressed or Defaulted Securities Risk. Investments in defaulted securities and obligations of distressed issuers, including securities that are, or may be, involved in reorganizations or other financial restructurings, either out of court or in bankruptcy, involve substantial risks in addition to the risks of investing in high-yield debt securities. A fund’s share price may decline if the reorganization or restructuring is not completed as anticipated. A fund will generally not receive interest payments on the distressed securities and may incur costs to protect its investment. Repayment of defaulted securities and obligations of distressed issuers is subject to significant uncertainties. A fund could lose its entire investment in such securities.
Rule 144A Securities Risk. The market for Rule 144A securities typically is less active than the market for publicly-traded securities. Rule 144A securities carry the risk that the liquidity of these securities may become impaired, making it more difficult for a fund to sell these bonds.
Zero Coupon Securities Risk. While interest payments are not made on such securities, holders of such securities are deemed to have received income annually, notwithstanding that cash may not be received currently. Some of these securities may be subject to substantially greater price fluctuations during periods of changing market interest rates than are comparable securities that pay interest currently. Longer term zero coupon bonds are more exposed to interest rate risk than shorter term zero coupon bonds.
California State-Specific Risk. Because the Schwab California Tax-Free Bond Fund concentrates its investments in California municipal securities, the fund may be affected significantly by economic, regulatory, social or political developments affecting the ability of California issuers to pay interest or repay principal.
Taxable Investments Risk. A fund may invest a portion of its assets in securities that generate income that is not exempt from federal income tax and in securities whose interest is subject to the AMT. These investments could generate taxable income for shareholders.
Portfolio Turnover Risk. The Schwab Opportunistic Municipal Bond Fund buys and sells portfolio securities actively. This may cause the fund’s portfolio turnover rate and transaction costs to rise, which may lower the fund’s performance and may increase the likelihood of capital gains distributions.
Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.
5. Affiliates and Affiliated Transactions:Charles Schwab Investment Management, Inc., dba Schwab Asset Management, a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement between the investment adviser and the trust.
For its advisory and administrative services to the Schwab Tax-Free Bond Fund and Schwab California Tax-Free Bond Fund, the investment adviser is entitled to receive an annual fee, payable monthly, equal to 0.22% of each fund’s average daily net assets.
For its advisory and administrative services to the Schwab Opportunistic Municipal Bond Fund, the investment adviser is entitled to receive an annual fee, payable monthly, equal to 0.40% of the fund’s average daily net assets.
The Board has adopted a Shareholder Servicing Plan (the Plan) on behalf of the funds, except the Schwab Opportunistic Municipal Bond Fund. The Plan enables each fund to bear expenses relating to the provision by financial intermediaries, including Charles Schwab & Co., Inc. (Schwab), a broker-dealer affiliate of the investment adviser (together, service providers), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds.
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Financial Notes (continued)
5. Affiliates and Affiliated Transactions (continued):
Pursuant to the Plan, each fund’s shares, excluding the Schwab Opportunistic Municipal Bond Fund, are subject to an annual shareholder servicing fee up to 0.15%. The shareholder servicing fee paid to a particular service provider is made pursuant to its written agreement with Schwab, as distributor of the funds (or, in the case of payments made to Schwab acting as a service provider, pursuant to Schwab’s written agreement with the funds). Payments under the Plan are made as described above without regard to whether the fee is more or less than the service provider’s actual cost of providing the services, and if more, such excess may be retained as profit by the service provider.
The investment adviser and its affiliates have made an additional agreement with the funds, for so long as the investment adviser serves as the investment adviser to the funds, in which the agreement may only be amended or terminated with the approval of the Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses (expense limitation) to 0.38% for Schwab Tax-Free Bond Fund and Schwab California Tax-Free Bond Fund, and 0.50% for the Schwab Opportunistic Municipal Bond Fund.
The funds may engage in direct transactions with certain other funds in the Fund Complex in accordance with procedures adopted by the Board pursuant to Rule 17a-7 under the 1940 Act. When one fund is seeking to sell a security that another fund is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs while allowing each fund to execute the transaction at the current market price. This practice is limited to funds that share the same investment adviser, trustees and/or officers.The net realized gains or losses on sales of interfund transactions are recorded in Net realized gains (losses) on sales of securities — unaffiliated issuers in the Statement of Operations. For the period ended August 31, 2024, the funds had no direct security transactions with other funds in the Fund Complex.
Interfund Borrowing and Lending
Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other funds in the Fund Complex. All loans are for temporary or emergency purposes and the interest rate to be charged will be the average of the overnight repurchase agreement rate and the short-term bank loan rate. All loans are subject to numerous conditions designed to ensure fair and equitable treatment of all participating funds. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.
The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The funds did not pay any of these interested persons for their services as trustees, but did pay non-interested persons (independent trustees), as noted in each fund’s Statement of Operations.
During the period, the funds were participants with other funds in the Fund Complex in a joint, syndicated, committed $1 billion line of credit (the Syndicated Credit Facility), which matured on September 28, 2023. On September 28, 2023, the Syndicated Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 26, 2024. Under the terms of the Syndicated Credit Facility, in addition to the investment adviser paying the interest charged on any borrowings by a fund, the investment adviser paid a commitment fee of 0.15% per annum on the funds’ proportionate share of the unused portion of the Syndicated Credit Facility.
During the period, the funds were participants with other funds in the Fund Complex in a joint, unsecured, uncommitted $400 million line of credit (the Uncommitted Credit Facility), with State Street Bank and Trust Company, which matured on September 28, 2023. On September 28, 2023, the Uncommitted Credit Facility was amended to run for a new 364 day period with the line of credit amount remaining unchanged, maturing on September 26, 2024. Under the terms of the Uncommitted Credit Facility, the investment adviser pays interest on the amount a fund borrows. There were no borrowings by any of the funds from either line of credit during the period.
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Financial Notes (continued)
7. Borrowing from Banks (continued):
The funds also have access to custodian overdraft facilities. A fund may have utilized the overdraft facility and incurred an interest expense, which is disclosed on each fund’s Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.
8. Purchases and Sales/Maturities of Investment Securities:For the period ended August 31, 2024, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:
| | SALES/MATURITIES
OF SECURITIES |
Schwab Tax-Free Bond Fund | | |
Schwab California Tax-Free Bond Fund | | |
Schwab Opportunistic Municipal Bond Fund | | |
As of August 31, 2024, the tax basis cost of the funds’ investments and gross unrealized appreciation and depreciation were as follows:
| | GROSS UNREALIZED
APPRECIATION | GROSS UNREALIZED
DEPRECIATION | NET UNREALIZED
APPRECIATION
(DEPRECIATION) |
Schwab Tax-Free Bond Fund | | | | |
Schwab California Tax-Free Bond Fund | | | | |
Schwab Opportunistic Municipal Bond Fund | | | | |
The primary difference between book basis and tax basis unrealized appreciation or unrealized depreciation of investments is the tax deferral of losses on wash sales and the differing treatment of amortization of bond discounts and premiums. The tax cost of the funds’ investments, disclosed above, have been adjusted from their book amounts to reflect these unrealized appreciation or depreciation differences, as applicable.
As of August 31, 2024, the components of distributable earnings on a tax basis were as follows:
| UNDISTRIBUTED
TAX-EXEMPT
INCOME | NET UNREALIZED
APPRECIATION
(DEPRECIATION)
ON INVESTMENTS | CAPITAL LOSS
CARRYFORWARDS
AND OTHER LOSSES | |
Schwab Tax-Free Bond Fund | | | | |
Schwab California Tax-Free Bond Fund | | | | |
Schwab Opportunistic Municipal Bond Fund | | | | |
The components of distributable earnings on a tax basis may not match the Total distributable earnings line item on the Statement of Assets and Liabilities due to other temporary timing differences.
Net investment income and realized capital gains and losses may differ for financial statement and tax purposes primarily due to differing treatments of amortization of bond discounts and premiums.
Capital loss carryforwards have no expiration and may be used to offset future realized capital gains for federal income tax purposes. As of August 31, 2024, the funds had capital loss carryforwards available as follows:
| |
Schwab Tax-Free Bond Fund | |
Schwab California Tax-Free Bond Fund | |
Schwab Opportunistic Municipal Bond Fund | |
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Financial Notes (continued)
9. Federal Income Taxes (continued):
The Schwab Opportunistic Municipal Bond Fund had a shareholder ownership change during the period ended August 31, 2023, which limits the availability of capital loss carryforwards to offset potential future capital gains. In addition to the available capital loss carryforward disclosed above for the Schwab Opportunistic Municipal Bond Fund, there are additional capital loss carryforwards as of the ownership change date in the amount of $1,688,338, the availability of those losses will be limited to $1,158,839 annually.
The tax basis components of distributions paid during the current and prior fiscal years were as follows:
| CURRENT FISCAL YEAR END DISTRIBUTIONS | PRIOR FISCAL YEAR END DISTRIBUTIONS |
| | | | |
Schwab Tax-Free Bond Fund | | | | |
Schwab California Tax-Free Bond Fund | | | | |
Schwab Opportunistic Municipal Bond Fund | | | | |
Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts in the financial statements. The funds may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes.
Permanent book and tax basis differences may result in reclassifications between components of net assets as required. The adjustments will have no impact on net assets or the results of operations.
As of August 31, 2024, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in each fund’s Statement of Operations. During the fiscal year ended August 31, 2024, the funds did not incur any interest or penalties.
Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.
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Schwab Municipal Bond Funds
Report of Independent Registered Public Accounting Firm
To the Board of Trustees of Schwab Investments and Shareholders of Schwab Tax-Free Bond Fund, Schwab California Tax-Free Bond Fund, and Schwab Opportunistic Municipal Bond Fund:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statements of assets and liabilities, including the portfolio holdings, of Schwab Tax-Free Bond Fund, Schwab California Tax-Free Bond Fund, and Schwab Opportunistic Municipal Bond Fund (the “Funds”), three of the funds constituting Schwab Investments, as of August 31, 2024, the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended for the Funds, except for Schwab Opportunistic Municipal Bond Fund; the financial highlights for the each of the four years in the period ended August 31, 2024 and for the period from March 1, 2020 through August 31, 2020; and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of each of the Funds as of August 31, 2024, and the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended (excluding Schwab Opportunistic Municipal Bond Fund) in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of Schwab Opportunistic Municipal Bond Fund as of August 31, 2024, and the results of its operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the four years in the period then ended and for the period from March 1, 2020 through August 31, 2020 in conformity with accounting principles generally accepted in the United States of America. For Schwab Opportunistic Municipal Bond Fund, the financial highlights for the period ended February 29, 2020 were audited by other auditors, whose report, dated April 29, 2020, expressed an unqualified opinion on such financial highlights.
These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of August 31, 2024, by correspondence with the custodian and brokers. We believe that our audits provide a reasonable basis for our opinion.
Deloitte & Touche LLP
Denver, Colorado
October 17, 2024
We have served as the auditor of one or more investment companies in the Schwab Funds Complex since 2020.
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Investment Advisory Agreement Approval
The Investment Company Act of 1940, as amended (the 1940 Act), requires that the continuation of a fund’s investment advisory agreement must be specifically approved (1) by the vote of the trustees or by a vote of the shareholders of the fund, and (2) by the vote of a majority of the trustees who are not parties to the investment advisory agreement or “interested persons” of any party thereto (the Independent Trustees), cast in person at a meeting called for the purpose of voting on such approval. In connection with such approvals, the fund’s trustees must request and evaluate, and the investment adviser is required to furnish, such information as may be reasonably necessary to evaluate the terms of the investment advisory agreement.
The Board of Trustees (the Board or the Trustees, as appropriate) calls and holds one or more meetings each year that are dedicated, in whole or in part, to considering whether to renew the investment advisory and administration agreement (the Agreement) between Schwab Investments (the Trust) and Charles Schwab Investment Management, Inc. (CSIM) (dba Schwab Asset Management) (the investment adviser) with respect to the existing funds in the Trust, including Schwab Tax-Free Bond Fund, Schwab California Tax-Free Bond Fund and Schwab Opportunistic Municipal Bond Fund (the Funds), and to review certain other agreements pursuant to which the investment adviser provides investment advisory services to certain other registered investment companies. In preparation for the meeting(s), the Board requests and reviews a wide variety of materials provided by the investment adviser, including information about the investment adviser’s affiliates, personnel, business goals and priorities, profitability, third-party oversight, corporate structure and operations. As part of the renewal process, the Independent Trustees’ legal counsel, on behalf of the Independent Trustees, sends an information request letter to the investment adviser seeking certain relevant information. The responses by the investment adviser are provided to the Trustees in the Board materials for their review prior to their meeting, and the Trustees are provided with the opportunity to request any additional materials. The Board also receives data provided by an independent provider of investment company data. This information is in addition to the detailed information about the Funds that the Board reviews during the course of each year, including information that relates to the Funds’ operations and performance, legal and compliance matters, risk management, portfolio turnover, and sales and marketing activity. In considering the renewal, the Independent Trustees receive advice from Independent Trustees’ legal counsel, including a memorandum regarding the responsibilities of trustees for the approval of investment advisory agreements. In addition, the Independent Trustees participate in question and
answer sessions with representatives of the investment adviser and meet in executive session outside the presence of Fund management.
The Board, including a majority of the Independent Trustees, considered information specifically relating to the continuance of the Agreement with respect to the Funds at meetings held on May 2, 2024 and June 6, 2024, and approved the renewal of the Agreement with respect to the Funds for an additional one-year term at the meeting on June 6, 2024 called for the purpose of voting on such approval.
The Board’s approval of the continuance of the Agreement with respect to the Funds was based on consideration and evaluation of a variety of specific factors discussed at these meetings and at prior meetings, including:
1.
the nature, extent and quality of the services provided to each Fund under the Agreement, including the resources of the investment adviser and its affiliates dedicated to the Funds;
2.
each Fund’s investment performance and how it compared to that of certain other comparable mutual funds and benchmark data;
3.
each Fund’s expenses and how those expenses compared to those of certain other similar mutual funds;
4.
the profitability of the investment adviser and its affiliates, including Charles Schwab & Co., Inc. (Schwab), with respect to each Fund, including both direct and indirect benefits accruing to the investment adviser and its affiliates; and
5.
the extent to which economies of scale would be realized as each Fund grows and whether fee levels in the Agreement reflect those economies of scale for the benefit of Fund investors.
Nature, Extent and Quality of Services. The Board considered the nature, extent and quality of the services provided by the investment adviser to the Funds and the resources of the investment adviser and its affiliates dedicated to the Funds. In this regard, the Trustees evaluated, among other things, the investment adviser’s experience, track record, compliance program, resources dedicated to hiring and retaining skilled personnel and specialized talent, and information security resources. The Trustees also considered information provided by the investment adviser relating to services and support provided with respect to the Funds’ portfolio management team, portfolio strategy, and internal investment guidelines, as well as trading infrastructure, liquidity management, product design and analysis, shareholder communications, securities valuation, and vendor and risk oversight. The Trustees also considered the investment adviser’s continued investment in its infrastructure, including the investment adviser’s
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technology and use of data, business continuity, cybersecurity, due diligence, risk management processes, and information security programs. The Trustees considered Schwab’s overall financial condition and its reputation as a full service brokerage firm, as well as the wide range of products, services and account features that benefit Fund shareholders who are brokerage clients of Schwab. Following such evaluation, the Board concluded, within the context of its full deliberations, that the nature, extent and quality of services provided by the investment adviser to the Funds and the resources of the investment adviser and its affiliates dedicated to the Funds supported renewal of the Agreement with respect to the Funds.
Fund Performance. The Board considered each Fund’s performance in determining whether to renew the Agreement with respect to such Fund. Specifically, the Trustees considered each Fund’s performance relative to a peer category of other mutual funds and applicable indices/benchmarks, in light of portfolio yield and the market environment, as well as in consideration of each Fund’s investment style and strategy. As part of this review, the Trustees considered the composition of the peer category, selection criteria and the reputation of the independent provider of investment company data who prepared the peer category analysis. In evaluating the performance of each Fund, the Trustees considered the risk profile for such Fund and the appropriateness of the benchmark used to compare the performance of each Fund. The Trustees further considered the level of Fund performance in the context of their review of Fund expenses and the investment adviser’s profitability discussed below and also noted that the Board and a designated committee of the Board review performance throughout the year. Following such evaluation, the Board concluded, within the context of its full deliberations, that the performance of each Fund supported renewal of the Agreement with respect to such Fund.
Fund Expenses. With respect to each Fund’s expenses, the Trustees considered the rate of compensation called for by the Agreement and each Fund’s operating expense ratio, in each case, in comparison to those of other similar mutual funds, such peer groups and comparisons having been selected and calculated by an independent provider of investment company data. The investment adviser reported to the Board, and the Board took into account, the risk assumed by the investment adviser in the development of the Funds and provision of services as well as the competitive marketplace for financial products. The Trustees considered the effects of the investment adviser’s and Schwab’s practice of waiving certain fees to prevent total annual operating expenses of the Funds from exceeding a specified cap. The Trustees also considered the investment adviser’s contractual commitment to limit the total annual operating expenses of each Fund for so long as the investment adviser serves as the adviser to the Fund. The Trustees also considered fees charged by the investment adviser to other mutual funds and to other types of accounts,
but, with respect to such other types of accounts, accorded less weight to such comparisons due to the different legal, regulatory, compliance and operating features of mutual funds as compared to these other types of accounts, and any differences in the nature and scope of the services the investment adviser provides to these other accounts, and any differences in the market for these types of accounts. Following such evaluation, the Board concluded, within the context of its full deliberations, that the expenses of each Fund are reasonable and supported renewal of the Agreement with respect to such Fund.
Profitability. The Trustees considered the compensation flowing to the investment adviser and its affiliates, directly or indirectly and reviewed profitability on a pre-tax basis, without regard to distribution expenses. The Trustees reviewed profitability of the investment adviser relating to the Schwab fund complex as a whole, noting the benefits to Fund shareholders of being part of the Schwab fund complex, including the allocations of certain costs across the Funds and other funds in the complex. The Trustees also considered any other benefits derived by the investment adviser from its relationship with the Funds, such as whether, by virtue of its management of the Funds, the investment adviser obtains investment information or other research resources that aid it in providing advisory services to other clients. The Trustees considered whether the compensation and profitability with respect to the Funds under the Agreement and other service agreements were reasonable in light of the quality of all services rendered to the Funds by the investment adviser and its affiliates. The Trustees noted that the investment adviser continues to invest substantial sums in its business in order to provide enhanced research capabilities, services and systems to benefit the Funds. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the profitability of the investment adviser with respect to each Fund is reasonable and supported renewal of the Agreement with respect to such Fund.
Economies of Scale. Although the Trustees recognized the difficulty of determining economies of scale with precision, and although the Funds do not have breakpoints in their advisory fees, the Trustees considered the potential existence of any economies of scale and whether those are passed along to a Fund’s shareholders through (i) the enhancement of services provided to the Funds in return for fees paid, including through investments by the investment adviser in its infrastructure, including modernizing the investment adviser’s technology and use of data, increasing expertise and capabilities in key areas (including portfolio and trade operations), and improving business continuity, cybersecurity, due diligence and information security programs, which are designed to provide enhanced services to the Funds and their shareholders; and (ii) fee waivers or expense caps by the investment adviser and its affiliates for those funds in the Schwab fund complex with such features. The Trustees acknowledged that the investment adviser has invested in its infrastructure, as discussed above,
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over time and noted the impact of regulatory and other developments on the investment adviser’s internal costs of providing investment management, technology, administrative, legal and compliance services to the Funds. The Trustees considered that the investment adviser and its affiliates may employ contractual expense caps to protect shareholders from high fees when fund assets are relatively small, for example, in the case of newer funds or funds with investment strategies that are from time to time out of favor, because, among other reasons, shareholders may benefit from the continued availability of such funds at subsidized expense levels. Based on this evaluation, the Board concluded, within the context of its full deliberations, that each Fund obtains reasonable benefits from economies of scale.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
In the course of their deliberations, the Trustees may have accorded different weights to various factors and did not identify any particular information or factor that was all important or controlling. Based on the Trustees’ deliberation and their evaluation of the information described above, the Board, including all of the Independent Trustees, approved the continuation of the Agreement with respect to the Funds and concluded that the compensation under the Agreement with respect to the Funds is fair and reasonable in light of the services provided and the related expenses borne by the investment adviser and its affiliates and such other matters as the Trustees considered to be relevant in the exercise of their reasonable judgment.
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Item 8: Changes in and Disagreements with Accountants for Open-End Management Investment Companies.
Not applicable.
Item 9: Proxy Disclosures for Open-End Management Investment Companies.
Not applicable.
Item 10: Remuneration Paid to Directors, Officers, and Others of Open-End Management Investment Companies.
The remuneration paid to directors, officers and others are included as part of the report to shareholders filed under Item 7 of this Form.
Item 11: Statement Regarding Basis for Approval of Investment Advisory Contract.
The statement regarding basis for approval of investment advisory contract is included as part of the report to shareholders filed under Item 7 of this Form.
Item 12: Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 13: Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 14: Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 15: Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 16: Controls and Procedures.
| (a) | Based on their evaluation of Registrant’s disclosure controls and procedures, as of a date within 90 days of the filing date, Registrant’s Principal Executive Officer, Omar Aguilar and Registrant’s Principal Financial Officer, Dana Smith, have concluded that Registrant’s disclosure controls and procedures are: (i) reasonably designed to ensure that information required to be disclosed in this report is appropriately communicated to Registrant’s officers to allow timely decisions regarding disclosures required in this report; (ii) reasonably designed to ensure that information required to be disclosed in this report is recorded, processed, summarized and reported in a timely manner; and (iii) are effective in achieving the goals described in (i) and (ii) above. |
| | (b) | During the period covered by this report, there have been no changes in Registrant’s internal control over financial reporting that the above officers believe to have materially affected, or to be reasonably likely to materially affect, Registrant’s internal control over financial reporting. |
Item 17: Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 18: Recovery of Erroneously Awarded Compensation.
Item 19: Exhibits.
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Schwab Investments - Schwab Taxable Bond Funds and Schwab Municipal Bond Funds
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| By: | | /s/ Omar Aguilar |
| | Omar Aguilar Principal Executive Officer (Chief Executive Officer) |
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| Date: | | October 17, 2024 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
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| By: | | /s/ Omar Aguilar |
| | Omar Aguilar Principal Executive Officer (Chief Executive Officer) |
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| Date: | | October 17, 2024 |
| | |
| By: | | /s/ Dana Smith |
| | Dana Smith Principal Financial Officer (Chief Financial Officer) |
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| Date: | | October 17, 2024 |
