How are these two Schwab ETFs categorised and what is the difference between a fundamental and a traditional index?

Both FNDX and SCHD are categorised as Large Value ETFs. The primary conceptual difference is how they select stocks. SCHD is a traditional dividend-focused fund that screens for high-yield, stable companies. FNDX, on the other hand, uses fundamental analysis—ranking companies by metrics like sales, cash flow, and book value—to select large US stocks that may be undervalued relative to their fundamental size. This means FNDX often holds a broader mix of stocks, including some growth names, compared to SCHD’s strict dividend criteria.

What is the expense ratio and how does a difference of 0.19 percentage points affect the fund's cost?

The expense ratio is the annual fee for managing the fund. FNDX has an expense ratio of 0.25%, while SCHD has a lower fee of 0.06%. The difference of 0.19 percentage points means that for every £100 invested, FNDX costs 25p per year and SCHD costs 6p. Although this seems small, over many years, a higher fee can reduce compounding. Beginners should understand that a lower expense ratio provides a structural cost advantage, assuming all other factors are equal.

Why are sector weights not available for these funds, and how does this impact investor understanding?

For both FNDX and SCHD, the sector weights are currently marked as 'not available' in the provided data. Without this breakdown, investors cannot immediately see if a fund is overly concentrated in one area, such as technology or healthcare. To assess risk, investors must instead look at the list of top holdings to infer the types of companies the fund owns. This makes understanding the portfolio's true diversity slightly more complex than reviewing a simple sector chart.

How does the top-10 holdings overlap influence a decision to buy both funds for diversification?

Diversification is about avoiding excessive exposure to the same assets. Based on the data, the only shared top-10 holding between FNDX and SCHD is Chevron (CVX). The other nine are entirely different. This low overlap suggests the funds are complementary rather than duplicative. Investors might hold both to combine different styles; however, it is essential to verify that the total portfolio remains diverse and aligns with an individual’s risk tolerance and time horizon.

What is the difference in dividend yield between FNDX and SCHD and how do ETF distributions work?

SCHD offers a higher yield of 3.11% compared to 1.43% for FNDX. This reflects their different focuses: SCHD screens specifically for high-yield stocks, while FNDX prioritises fundamentals that may not result in high payouts. When an ETF receives dividends from its holdings, it may distribute them to investors or reinvest them. For beginners, a higher yield means larger cash payouts, but it does not automatically mean a better investment return.

Why is net assets important when comparing the liquidity of FNDX to SCHD?

FNDX has $28.3 billion in assets, whereas SCHD is significantly larger at $112.8 billion. Generally, higher assets under management correlate with higher liquidity and tighter bid-ask spreads, making them easier to trade without moving the price. FNDX is still a large fund, but SCHD’s scale suggests a higher trading volume, which could be more suitable for investors planning to make large or frequent transactions.

How do the inception dates of these funds relate to their track records and stability?

SCHD launched on 20 October 2011, while FNDX began trading on 15 August 2013. This means SCHD has been established for around two years longer, giving it a slightly longer track record. However, both funds have been active through various market cycles for over a decade. This longevity provides more data for assessing performance, suggesting both are established products rather than new or unproven funds.

How does the tech sector exposure in FNDX compare to the healthcare and consumer staples focus in SCHD?

FNDX features exposure to major tech names like Apple (4.76%) and Microsoft (2.78%), providing a connection to a higher-growth sector. In contrast, SCHD’s top stocks are healthcare and staples (e.g., Merck 4.89%, Abbott 4.48%, Procter & Gamble 4.02%). These industries are often considered defensive because demand for their products remains relatively stable during economic downturns.

What is the implication of single-stock concentration in the top holdings of both funds?

FNDX's largest position is Apple at 4.76%, while SCHD's is Merck at 4.89%. In ETF investing, these weights are typical for diversified products. A holding of around 5% indicates that a single company’s performance will only have a limited effect on the fund's total value. This level of concentration ensures the fund is not overly reliant on one business but still tracks its target strategy.

What do the expense ratios of 0.25% and 0.06% mean for a beginner's total investment cost?

A fund's fee directly impacts your net return. For FNDX (0.25%), the fee is higher, likely due to the more complex fundamental selection process. SCHD (0.06%) is a more traditionally managed dividend fund with a lower fee. Over 10 years, a 19 basis point difference (0.19 percentage points) results in a significant accumulation of costs. The expense ratio is deducted from the fund’s assets, which is why the stated yields are net.

Which investing goals are typically associated with a fund like SCHD versus one like FNDX?

SCHD, with its 3.11% yield and focus on dividend-paying companies, is typically associated with generating steady income. FNDX is usually chosen by investors interested in fundamental analysis and a more general 'value' approach to US markets. The choice depends on your strategy: prioritising current cash flow from dividends versus participating in a broader fundamental value investment style.

How should an investor use this information when reviewing ETF performance on a comparison page?

Use this data to understand the fund's underlying mechanics rather than making immediate decisions. A comparison should prompt questions like: 'What is this fund trying to achieve?', 'How much does it cost?', and 'What companies does it actually own?'. Always check the fund's official prospectus for the most up-to-date information.

FNDX vs SCHD

Two funds, one decision: we compare cost, performance and what each ETF actually holds in September 2026.

Compare Schwab Fundamental US Large Company ETF (FNDX) and US Dividend Equity ETF Schwab (SCHD). Review fees, holdings, dividends and how each fund tracks its market. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

FNDX

Metric

SCHD

0.25%

Expense Ratio

0.06%

1.43%

Dividend Yield

3.11%

$28.32B

Net Assets

$112.77B

733

Holdings

102

Aug 15, 2013

Inception Date

Oct 20, 2011

–

Index Tracked

–

Large Value

Fund Category

Large Value

SCHD costs about $19.00 less per year for every $10,000 invested.

Shared Top Holdings

Holding	FNDX	SCHD
CVXChevron Corporation	1.66%	4.25%

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Investment Analysis

FNDX

Pros

Investors can hold a substantial $28.3 billion in net assets.
The fund provides exposure to major tech stocks like Apple and Microsoft.
It features a long track record since its August 2013 inception.

Considerations

The 0.25% expense ratio is higher than many competing large-cap value funds.
The 1.43% dividend yield may be unattractive for income-focused investors.
The fund's top holding, Apple, represents 4.76% of total assets.

SCHD

Pros

It boasts a very low expense ratio of just 0.06%.
Net assets are significant at $112.8 billion, ensuring high liquidity.
The 3.11% dividend yield offers a strong income stream for investors.

Considerations

The portfolio is heavily weighted towards healthcare and consumer staples.
Top holding Merck accounts for 4.89%, indicating some single-stock risk.
Exposure to growth-oriented technology sectors may be limited compared to broader funds.

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About FNDX and SCHD

FNDX (FNDX)

The Schwab Fundamental US Large Company ETF (FNDX) is an exchange-traded fund focused on large-cap U.S. companies with fundamental value characteristics. It aims to track an index designed to reflect the performance of these firms, using metrics like cash flow and dividends to determine weighting. With net assets of USD 28.32 billion, it offers broad exposure to established businesses through its 733 holdings. The fund operates with a 0.25% expense ratio and provides a dividend yield of 1.43%. Inception occurred on August 15, 2013. As with any investment, its value can fluctuate, and returns are not guaranteed.

SCHD (SCHD)

SCHD (Schwab US Dividend Equity ETF) is an exchange‑traded fund that aims to provide exposure to high-quality U.S. companies that have a history of paying dividends. Managed by Charles Schwab, the ETF screens for firms with stable earnings, reasonable payout ratios and consistent dividend records, concentrating on large‑cap names across a range of sectors. Investors often use SCHD for income and as a core holding to capture dividend yield with the diversification and liquidity of an ETF. It is designed to be a low‑cost, transparent vehicle, though dividends and share prices can fall and past performance is not a guarantee of future results. Suitable for investors seeking income and long‑term total return, it may not fit those focused solely on capital growth or who require guarantees. As with any investment, consider costs, tax treatment and how it fits your wider portfolio before investing.

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FNDX vs SCHD

Fund Snapshot