Fund ProfileInception Date10/17/2011   Total Assets$11.7B  
Total Holdings533   Portfolio Turnover61%  
Fund CompanyFranklin Templeton Investments   ESG Fund

ESG Fund

Environmental, Social, and Governance (ESG) is the industry term Schwab has chosen to use as an umbrella term to describe various investing approaches that consider not only traditional measures of risk and return, but environmental, social, and corporate governance (ESG) factors as well. Schwab uses ESG to broadly encompass ESG investing , but also investing approaches described as "values-based investing," "impact investing," "sustainable investing," and other approaches. An ESG product may apply ESG factors to its investment or governance processes in many different ways. A product that employs ESG strategies may choose to focus on one or more ESG factors, though an ESG product may also include securities that don't fit any ESG category. The information displayed utilizes the Morningstar "Sustainable Investment - Overall" datapoint. Click here to learn more about ESG at Schwab.

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Leveraged Fund

Leveraged Mutual Funds typically use derivatives to attempt to multiply the returns of the underlying index each day or month. These funds invest their portfolios much differently than other mutual funds. They have the propensity to be more volatile and are inherently riskier than their non-leveraged counterparts. It is important to remember that these funds are generally designed for short-term use only, and are generally not intended to be buy-and-hold positions, because their returns over longer periods generally do not match the mutual fund’s multiple of the underlying index over those periods. These funds are not appropriate for most investors.

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Inverse Fund

Inverse mutual funds typically use derivatives to attempt to move in the opposite direction of the underlying index by a certain multiple each day or month. They generally have either a negative number like –1x or –2x or a term like “short” or “inverse” in their names. These funds invest their portfolios much differently than other mutual funds. They have the propensity to be more volatile and are inherently riskier than their non-inverse counterparts. It is important to remember that these funds are designed for short-term use only, and are not intended to be buy-and-hold positions, because their returns over longer periods generally do not match the mutual fund’s negative multiple of the underlying index over longer periods. These funds are not appropriate for most investors.

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Risks of Interval Funds

Interval funds are not available for purchase by individual investors.

Interval funds are closed-end funds that offer daily purchases and redeem shares by periodically offering to repurchase a certain portion of shares from shareholders ("tenders" or "redemptions"). Rules and regulations related to interval funds enable fund companies to create portfolios with less capital volatility while holding a greater percentage of less-liquid, longer-term investments, often with higher risk-return opportunities than may be readily achieved in open-end mutual funds or exchange-traded funds (ETFs).

Although interval fund purchases resemble open-end mutual funds in that their shares are typically continuously offered and priced daily, they differ from traditional closed-end funds in that their shares are not sold on a secondary market. Instead, periodic repurchase offers are made to shareholders by the fund. The fund will specify a date by which shareholders must accept the repurchase offer. The actual repurchase will occur at a later, specified date. If repurchase requests exceed the number of shares that a fund offers to repurchase during the repurchase period, repurchases are prorated (reduced by the same percentage across all trades) prior to processing. In such event, shareholders may not be able to sell their expected amount, and would potentially experience increased illiquidity and market exposure, which could increase the potential for investment loss. To find out more about trading Interval Funds, please read Interval Funds: What you need to know.

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Morningstar Category: Ultrashort Bond

Ultrashort-bond portfolios invest primarily in investment-grade U.S. fixed-income issues and have durations typically of less than one year. This category can include corporate or government ultrashort bond portfolios, but it excludes international, convertible, multisector, and high-yield bond portfolios. Because of their focus on bonds with very short durations, these portfolios offer minimal interest-rate sensitivity and therefore low risk and total return potential. Morningstar calculates monthly breakpoints using the effective duration of the Morningstar Core Bond Index in determining duration assignment. Ultrashort is defined as 25% of the three-year average effective duration of the MCBI.