SCHX vs. SCHG: What’s The Difference?

The Schwab U.S. Large-Cap ETF (SCHX) and the Schwab U.S. Large-Cap Growth ETF (SCHG) are both among the Top 100 ETFs. SCHX is a Schwab ETFs Large Blend fund and SCHG is a Schwab ETFs Large Growth fund. So, what’s the difference between SCHX and SCHG? And which fund is better?

The expense ratio of SCHX is 0.01 percentage points lower than SCHG’s (0.03% vs. 0.04%). SCHX also has a lower exposure to the technology sector and a lower standard deviation. Overall, SCHX has provided lower returns than SCHG over the past ten years.

In this article, we’ll compare SCHX vs. SCHG. We’ll look at industry exposure and portfolio growth, as well as at their fund composition and performance. Moreover, I’ll also discuss SCHX’s and SCHG’s risk metrics, annual returns, and holdings and examine how these affect their overall returns.

Summary

SCHX SCHG
Name Schwab U.S. Large-Cap ETF Schwab U.S. Large-Cap Growth ETF
Category Large Blend Large Growth
Issuer Schwab ETFs Schwab ETFs
AUM 30.89B 15.16B
Avg. Return 14.60% 17.81%
Div. Yield 1.41% 0.43%
Expense Ratio 0.03% 0.04%

The Schwab U.S. Large-Cap ETF (SCHX) is a Large Blend fund that is issued by Schwab ETFs. It currently has 30.89B total assets under management and has yielded an average annual return of 14.60% over the past 10 years. The fund has a dividend yield of 1.41% with an expense ratio of 0.03%.

The Schwab U.S. Large-Cap Growth ETF (SCHG) is a Large Growth fund that is issued by Schwab ETFs. It currently has 15.16B total assets under management and has yielded an average annual return of 17.81% over the past 10 years. The fund has a dividend yield of 0.43% with an expense ratio of 0.04%.

SCHX’s dividend yield is 0.98% higher than that of SCHG (1.41% vs. 0.43%). Also, SCHX yielded on average 3.21% less per year over the past decade (14.60% vs. 17.81%). The expense ratio of SCHX is 0.01 percentage points lower than SCHG’s (0.03% vs. 0.04%).

Fund Composition

Industry Exposure

SCHX vs. SCHG - Industry Exposure

SCHX SCHG
Technology 25.13% 39.21%
Industrials 8.65% 3.01%
Energy 2.72% 0.2%
Communication Services 11.26% 17.07%
Utilities 2.37% 0.0%
Healthcare 13.04% 12.05%
Consumer Defensive 5.97% 2.15%
Real Estate 3.13% 1.64%
Financial Services 13.82% 7.98%
Consumer Cyclical 11.63% 15.01%
Basic Materials 2.28% 1.68%

The Schwab U.S. Large-Cap ETF (SCHX) has the most exposure to the Technology sector at 25.13%. This is followed by Financial Services and Healthcare at 13.82% and 13.04% respectively. Utilities (2.37%), Energy (2.72%), and Real Estate (3.13%) only make up 8.22% of the fund’s total assets.

SCHX’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 5.97%, 8.65%, 11.26%, 11.63%, and 13.04%.

The Schwab U.S. Large-Cap Growth ETF (SCHG) has the most exposure to the Technology sector at 39.21%. This is followed by Communication Services and Consumer Cyclical at 17.07% and 15.01% respectively. Energy (0.2%), Real Estate (1.64%), and Basic Materials (1.68%) only make up 3.52% of the fund’s total assets.

SCHG’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Consumer Cyclical stocks at 2.15%, 3.01%, 7.98%, 12.05%, and 15.01%.

SCHX is 14.08% less exposed to the Technology sector than SCHG (25.13% vs 39.21%). SCHX’s exposure to Financial Services and Healthcare stocks is 5.84% higher and 0.99% higher respectively (13.82% vs. 7.98% and 13.04% vs. 12.05%). In total, Utilities, Energy, and Real Estate also make up 6.38% more of the fund’s holdings compared to SCHG (8.22% vs. 1.84%).

Holdings

SCHX - Holdings

SCHX Holdings Weight
Apple Inc 5.37%
Microsoft Corp 5.1%
Amazon.com Inc 3.69%
Facebook Inc A 2.08%
Alphabet Inc A 1.84%
Alphabet Inc Class C 1.78%
Berkshire Hathaway Inc Class B 1.32%
Tesla Inc 1.31%
NVIDIA Corp 1.25%
JPMorgan Chase & Co 1.18%

SCHX’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc A at 5.37%, 5.1%, 3.69%, 2.08%, and 1.84%.

Alphabet Inc Class C (1.78%), Berkshire Hathaway Inc Class B (1.32%), and Tesla Inc (1.31%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the SCHX’s holdings at 1.25% and 1.18%.

SCHG - Holdings

SCHG Holdings Weight
Apple Inc 11.49%
Microsoft Corp 10.91%
Amazon.com Inc 7.89%
Facebook Inc A 4.45%
Alphabet Inc A 3.93%
Alphabet Inc Class C 3.82%
Tesla Inc 2.8%
NVIDIA Corp 2.67%
Visa Inc Class A 2.12%
UnitedHealth Group Inc 2.02%

SCHG’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc A at 11.49%, 10.91%, 7.89%, 4.45%, and 3.93%.

Alphabet Inc Class C (3.82%), Tesla Inc (2.8%), and NVIDIA Corp (2.67%) have a slightly smaller but still significant weight. Visa Inc Class A and UnitedHealth Group Inc are also represented in the SCHG’s holdings at 2.12% and 2.02%.

Risk Analysis

SCHX SCHG
Mean Return 1.24 1.46
R-squared 99.83 92.92
Std. Deviation 13.8 14.78
Alpha -0.14 1.97
Beta 1.02 1.05
Sharpe Ratio 1.03 1.14
Treynor Ratio 14.06 16.3

The Schwab U.S. Large-Cap ETF (SCHX) has a Mean Return of 1.24 with a Alpha of -0.14 and a Standard Deviation of 13.8. Its Sharpe Ratio is 1.03 while SCHX’s Treynor Ratio is 14.06. Furthermore, the fund has a Beta of 1.02 and a R-squared of 99.83.

The Schwab U.S. Large-Cap Growth ETF (SCHG) has a Mean Return of 1.46 with a Beta of 1.05 and a Sharpe Ratio of 1.14. Its Treynor Ratio is 16.3 while SCHG’s Standard Deviation is 14.78. Furthermore, the fund has a R-squared of 92.92 and a Alpha of 1.97.

SCHX’s Mean Return is 0.22 points lower than that of SCHG and its R-squared is 6.91 points higher. With a Standard Deviation of 13.8, SCHX is slightly less volatile than SCHG. The Alpha and Beta of SCHX are 2.11 points lower and 0.03 points lower than SCHG’s Alpha and Beta.

Performance

Annual Returns

SCHX vs. SCHG - Annual Returns

Year SCHX SCHG
2020 20.9% 39.13%
2019 31.4% 36.21%
2018 -4.52% -1.35%
2017 21.91% 28.04%
2016 11.78% 6.76%
2015 1.02% 3.26%
2014 13.33% 15.74%
2013 32.54% 33.96%
2012 16.06% 17.02%
2011 1.61% -0.67%
2010 15.88% 16.83%

SCHX had its best year in 2013 with an annual return of 32.54%. SCHX’s worst year over the past decade yielded -4.52% and occurred in 2018. In most years the Schwab U.S. Large-Cap ETF provided moderate returns such as in 2014, 2010, and 2012 where annual returns amounted to 13.33%, 15.88%, and 16.06% respectively.

The year 2020 was the strongest year for SCHG, returning 39.13% on an annual basis. The poorest year for SCHG in the last ten years was 2018, with a yield of -1.35%. Most years the Schwab U.S. Large-Cap Growth ETF has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 15.74%, 16.83%, and 17.02% respectively.

Portfolio Growth

SCHX vs. SCHG - Portfolio Growth

Fund Initial Balance Final Balance CAGR
SCHX $10,000 $36,987 14.60%
SCHG $10,000 $47,556 17.81%

A $10,000 investment in SCHX would have resulted in a final balance of $36,987. This is a profit of $26,987 over 10 years and amounts to a compound annual growth rate (CAGR) of 14.60%.

With a $10,000 investment in SCHG, the end total would have been $47,556. This equates to a $37,556 profit over 10 years and a compound annual growth rate (CAGR) of 17.81%.

SCHX’s CAGR is 3.21 percentage points lower than that of SCHG and as a result, would have yielded $10,569 less on a $10,000 investment. Thus, SCHX performed worse than SCHG by 3.21% annually.


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