The Schwab U.S. Mid-Cap ETF (SCHM) was launched on 01/13/2011, and is a passively managed exchange traded fund designed to offer broad exposure to the Mid Cap Blend segment of the US equity market.

The fund is sponsored by Charles Schwab. It has amassed assets over $11.67 billion, making it one of the larger ETFs attempting to match the Mid Cap Blend segment of the US equity market.

Why Mid Cap Blend

Mid cap companies, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus they have a nice balance of growth potential and stability.

Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.04%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.38%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Industrials sector--about 19.90% of the portfolio. Financials and Consumer Discretionary round out the top three.

Looking at individual holdings, United Airlines Holdings Inc (UAL) accounts for about 0.75% of total assets, followed by Robinhood Markets Inc Class A (HOOD) and Eqt Corp (EQT).

The top 10 holdings account for about 5.42% of total assets under management.

Performance and Risk

SCHM seeks to match the performance of the Dow Jones U.S. Mid-Cap Total Stock Market Index before fees and expenses. The Dow Jones U.S. Mid-Cap Total Stock Market Index is a float-adjusted market capitalization weighted index. The Index includes the mid-cap portion of the Dow Jones U.S. Total Stock Market Index actually available to investors in the marketplace and includes the components ranked 501-1000 by full market capitalization.

The ETF return is roughly 3.46% so far this year and it's up approximately 14.90% in the last one year (as of 02/12/2025). In the past 52-week period, it has traded between $24.90 and $30.08.

The ETF has a beta of 1.14 and standard deviation of 19.55% for the trailing three-year period, making it a medium risk choice in the space. With about 500 holdings, it effectively diversifies company-specific risk.

Alternatives

Schwab U.S. Mid-Cap ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, SCHM is a reasonable option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The Vanguard Mid-Cap ETF (VO) and the iShares Core S&P Mid-Cap ETF (IJH) track a similar index. While Vanguard Mid-Cap ETF has $76.38 billion in assets, iShares Core S&P Mid-Cap ETF has $98.29 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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Schwab U.S. Mid-Cap ETF (SCHM): ETF Research Reports

United Airlines Holdings Inc (UAL) : Free Stock Analysis Report

EQT Corporation (EQT) : Free Stock Analysis Report

iShares Core S&P Mid-Cap ETF (IJH): ETF Research Reports

Vanguard Mid-Cap ETF (VO): ETF Research Reports

Robinhood Markets, Inc. (HOOD) : Free Stock Analysis Report

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