Market Expectations - A quarter-point rate cut is widely anticipated, with 25 basis points being almost certain, while any other decision could lead to significant market volatility [2][3] - Historical data shows that after rate cuts, particularly when the market is near all-time highs, stocks tend to move higher, with 20 out of 20 instances indicating a positive trend [5] Economic Indicators - The labor market is a key factor influencing the expected rate cut, with inflation metrics also playing a crucial role in determining future cuts [3][4] - Consumer discretionary stocks are outperforming staples, indicating a bullish market sentiment, while high beta stocks are also hitting new highs [6] Tariff Concerns - Tariff uncertainties have diminished for the remainder of the year, although there is potential for these concerns to resurface in the future [7][8] - The impact of tariffs has been absorbed by companies with higher margins, allowing them to maintain profitability despite potential cost increases [9] Investment Strategies - There is a positive outlook for international stocks, particularly in Europe, due to attractive valuations and earnings growth, while small caps are viewed as underweight compared to large caps [10][11] - The market anticipates six rate cuts over the next 15 months, but the economy may perform better than expected, potentially leading to fewer cuts [11] Consumer Sentiment - Retail and consumer data are showing resilience, suggesting that the economy may continue to grow, supported by increased capital expenditures as companies resume delayed investments [12][13]

Core Insights - The article focuses on the Schwab Long-Term U.S. Treasury ETF, identified by the ticker NYSEARCA: SCHQ, which is managed by Charles Schwab [1] Group 1 - The Schwab Long-Term U.S. Treasury ETF is described as a simple and cost-effective investment vehicle [1]

Core Insights - Charles Schwab (SCHW) reported total client assets of $11.23 trillion in August 2025, reflecting a 15.3% increase year-over-year and a 2.4% increase from July 2025 [1][9] - The company continues to benefit from market volatility, strong asset gathering, and client engagement, leading to increased revenues despite lower fees on certain products [2] - Over the past five years, Schwab's total client assets have experienced a compound annual growth rate (CAGR) of 20.1%, driven by acquisitions and market appreciation [3] Financial Performance - Core net new assets reached $44.4 billion, a 35.4% increase from the previous year but a 5.3% decline from July 2025 [1][9] - The Zacks Consensus Estimate for 2025 revenues is $23.42 billion, indicating a year-over-year growth of 19.4% [4] - Average interest-earning assets were $417.2 billion, showing a slight decline from previous periods, while average margin balances increased by 23.3% year-over-year [7] Client Engagement - Schwab opened 382,000 new brokerage accounts in August 2025, marking a 17.9% increase year-over-year [8][9] - Active brokerage accounts totaled 37.8 million, up 5.4% from the previous year [8] - Client banking accounts reached 2.1 million, reflecting a 10.2% increase year-over-year [8] Competitive Landscape - Schwab's competitor, Robinhood, reported a significant increase in total platform assets, which surged 112% year-over-year [10] - Interactive Brokers also saw a year-over-year rise in client Daily Average Revenue Trades (DARTs) by 29% in August 2025 [12]

Core Viewpoint - The bond market's reaction to Federal Reserve actions is critical, with inflation trends being a more significant driver of bond yields than Fed rate cuts [3][4][6]. Group 1: Federal Reserve Actions - The Federal Reserve's potential rate cuts are largely anticipated by the market, but the actual impact on borrowing costs, such as mortgage rates, remains uncertain [2][4]. - The Fed's balance sheet management, including quantitative easing (QE) and quantitative tightening (QT), is crucial for influencing long-term bond yields [9][10]. Group 2: Inflation and Economic Conditions - Inflation remains a key concern, with current rates around 3% and showing signs of increasing, which complicates the economic landscape and poses risks of stagflation [3][7]. - The bond market is experiencing hesitancy in longer-term investments due to inflation expectations and significant fiscal deficits in various countries [6][7]. Group 3: Market Dynamics - There is a possibility of a bond market rally following Fed rate cuts, but it may not be sufficient to lower mortgage rates below 6% [8]. - The dynamics of supply and demand for bonds, particularly longer-term bonds, are influenced by investor confidence and the Fed's actions regarding its bond holdings [6][7].

Summary of Key Points Core Viewpoint - John W. Rogers Jr. of Ariel Appreciation Fund has made significant reductions in his equity holdings, indicating a strategic shift in response to valuation concerns and macroeconomic factors affecting various sectors. Group 1: Notable Reductions - **Northern Trust Corp (NTRS)**: A reduction of 47.22% with 158,349 shares sold, reflecting potential concerns over fee compression and macro headwinds in wealth management [1]. - **JM Smucker Co (SJM)**: A decrease of 35.16% with 68,878 shares cut, possibly due to input cost inflation and changing consumer preferences [2]. - **Charles Schwab Corp (SCHW)**: A reduction of 33.48% with 112,370 shares sold, linked to rate-related margin pressures and lower trading activity post-peak retail trading enthusiasm [3]. - **Kennametal Inc (KMT)**: A decrease of 30.91% with 267,930 shares trimmed, suggesting caution towards slowing manufacturing demand despite operational improvements [4]. - **CBRE Group Inc – A (CBRE)**: A reduction of 18.12% with 25,409 shares cut, reflecting concerns in the commercial real estate sector due to remote work trends and higher financing costs [5]. Group 2: Strategic Implications - The reductions across these holdings suggest a tightening of the portfolio around higher-conviction names, as the company responds to a shifting macro environment and potential valuation concerns [5].

Market caps today:🥇 $SCHW $173.97B🥈 $HOOD $92.45B (outlier growth 🏎️📈)🥉 $COIN $78.25BToken Terminal 📊 (@tokenterminal):The Fintech Flippening?@CharlesSchwab has ~10x more employees than @RobinhoodApp and @coinbase, and is potentially not as well-positioned to leverage the growth of crypto & AI --> aka the 2 biggest growth & operational efficiency drivers for financial services companies. https://t.co/lADpVR1jne ...

Core Viewpoint - The recent rally in the U.S. stock market is broadening beyond just the technology giants, with more sectors and companies participating in the upward trend [1][3][4]. Group 1: Market Performance - The Invesco S&P 500 Equal Weight ETF rose by 2.7% in August, marking its longest consecutive monthly gain since May 2021, achieving four months of increases [1][5]. - The S&P 500 index increased by 1.9% in August, also achieving its longest consecutive monthly gain since September 2024 [7]. - The Roundhill MAGS ETF, which bundles the "Magnificent Seven" tech stocks, rose approximately 2% in August, achieving five consecutive months of gains, although at a slower pace [5]. Group 2: Economic Indicators - The U.S. economy shows resilience, with the Bureau of Economic Analysis reporting a second-quarter GDP annualized growth rate of 3.3%, exceeding many expectations [7]. - The strong employment market is identified as a core support for the overall economic resilience [7]. Group 3: Market Sentiment - Charles Schwab's Chief Investment Strategist, Liz Ann Sonders, noted that the participation rate among S&P 500 constituents is steadily increasing, indicating a less concentrated market rally [4]. - Northlight Asset Management's Chief Investment Officer, Chris Zaccarelli, expressed that despite September typically being a poor-performing month, there are no significant risks currently threatening the ongoing rally, suggesting potential buying opportunities if market volatility occurs [8].

Group 1 - The Value Lab focuses on long-only value investment strategies, aiming to identify mispriced international equities with a target portfolio yield of approximately 4% [1][2] - The Schwab Short-Term U.S. Treasury ETF (SCHO) is highlighted as a two-year investment opportunity in Treasuries, providing sufficient sensitivity for speculation while considering the interest rate trajectory [2] - The Valkyrie Trading Society consists of analysts who share high-conviction investment ideas in developed markets, emphasizing downside protection and the potential for non-correlated, outsized returns in the current economic climate [3]

Core Insights - The Schwab U.S. Mid-Cap ETF (SCHM) is a passively managed fund launched on January 13, 2011, with over $11.83 billion in assets, targeting the Mid Cap Blend segment of the U.S. equity market [1] Group 1: Investment Characteristics - Mid cap companies, with market capitalizations between $2 billion and $10 billion, provide a balance of stability and growth potential, offering less risk and higher growth opportunities compared to small and large companies [2] - The ETF has an annual operating expense of 0.04%, making it one of the least expensive options in its category, with a 12-month trailing dividend yield of 1.4% [3] Group 2: Sector Exposure and Holdings - The ETF has a significant allocation to the Industrials sector, comprising about 21.1% of the portfolio, followed by Financials and Consumer Discretionary [4] - Robinhood Markets Inc Class A (HOOD) represents approximately 1.51% of total assets, with the top 10 holdings accounting for about 6.82% of total assets under management [5] Group 3: Performance Metrics - SCHM aims to match the performance of the Dow Jones U.S. Mid-Cap Total Stock Market Index, which includes mid-cap stocks ranked 501-1000 by market capitalization [6] - The ETF has increased by roughly 4.65% year-to-date and is up about 8.79% over the past year, with a trading range between $22.92 and $30.08 in the last 52 weeks [7] Group 4: Alternatives and Market Position - SCHM holds a Zacks ETF Rank of 3 (Hold), indicating it is a viable option for investors seeking exposure to the Mid Cap Blend market segment [8] - Other comparable ETFs include the Vanguard Mid-Cap ETF (VO) and the iShares Core S&P Mid-Cap ETF (IJH), with assets of $86.07 billion and $97.22 billion respectively, and expense ratios of 0.04% and 0.05% [9] Group 5: Market Trends - There is a growing trend among retail and institutional investors towards passively managed ETFs due to their low costs, transparency, flexibility, and tax efficiency, making them suitable for long-term investment strategies [10]

Core Insights - Charles Schwab (SCHW) reported a significant increase in client assets, reaching $10.96 trillion in July 2025, which is a 15% increase from July 2024 and a 2% increase from June 2025 [1][8] - The company continues to benefit from market volatility, strong asset gathering, and increased client engagement, despite lowering fees on some products [2] - Schwab's total client assets have shown a compound annual growth rate (CAGR) of 20.1% over the past five years, driven by acquisitions and market appreciation [3] Financial Performance - Core net new assets increased by 62% year-over-year to $46.9 billion, with a 10% increase from June 2025 [1][8] - The Zacks Consensus Estimate for Schwab's 2025 revenues is projected at $23.41 billion, indicating a year-over-year growth of 19.4% [4] - Trading revenues have risen year-over-year in the first half of 2025, reflecting the increase in average client assets [2] Client Activity - Schwab opened 377,000 new brokerage accounts in July 2025, a 15% increase from the previous year [7][8] - Active brokerage accounts totaled 37.7 million, up 5% year-over-year [7] - Average interest-earning assets were $418.6 billion, with average margin balances increasing by 17% year-over-year [6] Competitive Landscape - Schwab's close competitor, Robinhood, reported increases in Daily Average Revenue Trades (DARTs) across various categories, indicating a competitive market environment [9][10] - Interactive Brokers also reported a year-over-year rise in client DARTs, suggesting a robust trading backdrop [10][11] Valuation and Estimates - Schwab's shares have increased by 29.9% year-to-date, outperforming the industry average of 20.8% [12] - The forward price-to-earnings (P/E) ratio for Schwab is 18.72, which is above the industry average [13] - Earnings estimates for 2025 and 2026 indicate year-over-year growth of 42.5% and 17.3%, respectively, with upward revisions in estimates over the past 30 days [15]