Core Viewpoint - The Schwab Fundamental U.S. Small Company ETF (FNDA) provides broad exposure to the Small Cap Value segment of the US equity market, with significant assets under management and a focus on cost efficiency [1][4]. Group 1: Fund Overview - FNDA is a passively managed ETF launched on August 13, 2013, and is sponsored by Charles Schwab, with assets exceeding $8.67 billion [1]. - The ETF targets small cap companies with market capitalizations below $2 billion, which are considered high-potential but come with higher risks compared to larger counterparts [2]. Group 2: Investment Characteristics - Value stocks, which FNDA focuses on, typically have lower price-to-earnings and price-to-book ratios, but also exhibit lower sales and earnings growth rates [3]. - Historically, value stocks have outperformed growth stocks in most markets, although growth stocks tend to perform better in strong bull markets [3]. Group 3: Cost Structure - FNDA has an annual operating expense ratio of 0.25%, positioning it as one of the more cost-effective options in the ETF space [4]. - The ETF offers a 12-month trailing dividend yield of 1.31% [4]. Group 4: Sector Exposure and Holdings - The ETF has a significant allocation to the Industrials sector, comprising approximately 20.6% of the portfolio, followed by Financials and Consumer Discretionary [5]. - Woodward Inc (WWD) is the largest individual holding at about 0.34% of total assets, with the top 10 holdings accounting for roughly 3.03% of total assets under management [6]. Group 5: Performance Metrics - FNDA aims to match the performance of the Russell RAFI US Small Co. Index, with a year-to-date return of approximately 2.44% and a one-year return of about 6.38% as of August 20, 2025 [7]. - The ETF has traded between $23.85 and $32.42 over the past 52 weeks [7]. Group 6: Risk Profile - FNDA has a beta of 1.10 and a standard deviation of 20.93% over the trailing three-year period, indicating a medium risk profile [8]. - The ETF consists of about 986 holdings, which helps to diversify company-specific risk [8]. Group 7: Alternatives - FNDA holds a Zacks ETF Rank of 2 (Buy), indicating favorable expected returns based on various factors [9]. - Other comparable ETFs include the iShares Russell 2000 Value ETF (IWN) and the Vanguard Small-Cap Value ETF (VBR), with IWN having $11.31 billion in assets and VBR at $30.67 billion [10]. Group 8: 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 [11].

Core Insights - The Vanguard Small-Cap Value ETF (VBR) is a passively managed fund launched on January 26, 2004, with over $30.57 billion in assets, making it the largest ETF in the Small Cap Value segment of the US equity market [1] - Small cap companies, defined as those with market capitalizations below $2 billion, present high potential but also come with higher risks [2] - Value stocks typically have lower price-to-earnings and price-to-book ratios, but also exhibit lower sales and earnings growth rates compared to growth stocks [3] Costs - The ETF has an annual operating expense ratio of 0.07%, positioning it as one of the least expensive options in its category [4] - It offers a 12-month trailing dividend yield of 2.03% [4] Sector Exposure and Top Holdings - The ETF's largest allocation is to the Financials sector, comprising approximately 21.70% of the portfolio, followed by Industrials and Consumer Discretionary [5] - Individual holdings include Slcmt1142 at about 1.08% of total assets, with NRG Energy Inc (NRG) and Emcor Group Inc (EME) also among the top holdings [6] Performance and Risk - VBR aims to match the performance of the CRSP U.S. Small Cap Value Index, having gained roughly 3.30% year-to-date and 6.60% over the past year as of July 23, 2025 [7] - The ETF has traded between $162.76 and $217.30 in the past 52 weeks [7] - With a beta of 1.03 and a standard deviation of 19.72% over the trailing three years, it is classified as a medium-risk investment [8] Alternatives - VBR holds a Zacks ETF Rank of 2 (Buy), indicating strong expected returns and favorable expense ratios [9] - Other comparable ETFs include the Schwab Fundamental U.S. Small Company ETF (FNDA) with $8.62 billion in assets and an expense ratio of 0.25%, and the iShares Russell 2000 Value ETF (IWN) with $11.09 billion in assets and an expense ratio of 0.24% [10] Bottom-Line - Passively managed ETFs like VBR are gaining popularity among both institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency, making them suitable for long-term investment strategies [11]

The Schwab Fundamental U.S. Small Company ETF (FNDA) was launched on 08/13/2013, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Small Cap Value category of the market. What Are Smart Beta ETFs? The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment. Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating marke ...

Core Insights - The iShares Russell 2000 Value ETF (IWN) is a passively managed fund aimed at providing broad exposure to the Small Cap Value segment of the US equity market, with assets exceeding $10.95 billion, making it one of the largest ETFs in this category [1] Investment Potential - Small cap companies, defined as those with market capitalizations below $2 billion, present significant investment potential but also come with higher risks [2] - Value stocks typically have lower price-to-earnings and price-to-book ratios, and while they have lower sales and earnings growth rates, they have historically outperformed growth stocks in most markets, although they may underperform in strong bull markets [3] Cost Structure - The annual operating expenses for IWN are 0.24%, positioning it as one of the cheaper options in the ETF space, with a 12-month trailing dividend yield of 1.78% [4] Sector Allocation - The ETF has a significant allocation to the Financials sector, comprising approximately 30.30% of the portfolio, followed by Industrials and Real Estate [5] - The top 10 holdings account for about 5.26% of total assets, with Southstate Corp (SSB) making up around 0.71% of total assets [6] Performance Metrics - IWN aims to match the performance of the Russell 2000 Value Index, having gained about 0.22% year-to-date and approximately 0.31% over the past year as of July 21, 2025, with a trading range between $131.84 and $181.35 in the past 52 weeks [7] - The ETF has a beta of 1.07 and a standard deviation of 21.83% over the trailing three-year period, indicating a medium risk profile [8] Competitive Landscape - IWN holds a Zacks ETF Rank of 2 (Buy), indicating strong expected returns based on various factors, making it a compelling option for investors interested in the Small Cap Value segment [9] - Other alternatives include the Schwab Fundamental U.S. Small Company ETF (FNDA) with $8.49 billion in assets and an expense ratio of 0.25%, and the Vanguard Small-Cap Value ETF (VBR) with $30.17 billion in assets and a lower expense ratio of 0.07% [10] Conclusion - Passively managed ETFs like IWN are increasingly favored by both retail and institutional investors due to their low costs, transparency, flexibility, and tax efficiency, making them suitable for long-term investment strategies [11]