What is the main difference between SCHP and SCHZ?

SCHP invests exclusively in Treasury Inflation-Protected Securities, linking returns to inflation metrics. In contrast, SCHZ targets a broad range of US investment-grade bonds, serving as a general fixed-income benchmark. Their distinct focuses create different behaviours regarding inflation and economic cycles.

How do these ETFs differ in their expense ratios?

Both SCHP and SCHZ share an identical expense ratio of 0.03%. Because the fee level is equal, investors cannot rely on cost differences to separate them. This equality forces a comparison based strictly on the assets each fund holds and their intended role in a diversified portfolio.

What does 'expense ratio' mean for these funds?

The expense ratio represents the annual operating cost of a fund, expressed as a percentage of the assets you own. For both SCHP and SCHZ, the 0.03% fee is deducted from fund assets, slightly reducing the net return. It measures the cost of management and administration.

Which fund provides broader diversification, SCHP or SCHZ?

SCHZ offers broader diversification due to its exposure to a wide range of US investment-grade bonds. SCHP is highly concentrated, focusing exclusively on a specific asset class of TIPS. Investors generally view SCHZ as a more comprehensive tool for the entire fixed-income market compared to SCHP.

How do the dividend yields of SCHP and SCHZ compare?

As of late 2026, SCHP reports a dividend yield of 5.02%, while SCHZ offers a lower yield of 4.26%. While the gap appears meaningful, these yields reflect current market interest rates and the unique inflation-adjusted coupons of TIPS rather than a permanent difference in performance.

How are income distributions typically handled by these funds?

The funds pay income periodically to shareholders, determined by the interest coupons and dividends collected from the underlying bonds. This income is taxed as ordinary interest income rather than qualified dividend income. It is a distribution of the fund's accumulated revenue from its bond holdings.

Which fund is appropriate for an investor seeking inflation protection?

SCHP is explicitly designed for inflation protection because its principal value adjusts based on inflation indices. SCHZ lacks a dedicated hedge against inflation and remains vulnerable to price erosion when inflation rises. Investors needing specific protection against rising price levels might find SCHP more aligned with that need.

What market conditions typically favour TIPS like those in SCHP?

SCHP holds TIPS, which tend to perform well when inflation rises unexpectedly or when breakeven inflation rates are low. During periods of high nominal interest rates without inflation, these bonds may underperform general aggregate bonds like SCHZ, which benefit from traditional yield structures.

How does SCHZ compare to SCHP during deflationary periods?

SCHP's TIPS principal is indexed to inflation and can decline during deflation, though the US Treasury guarantees payment of at least the original value at maturity. SCHZ, being non-indexed, may experience capital gains as prices rise during deflation. The difference lies in the specific mechanics of indexed vs standard bonds.

Are there common holdings between SCHP and SCHZ?

The comparison data indicates no shared top-10 holdings between the two funds. While the underlying index data for both is currently listed as not available, this lack of overlap suggests that the funds maintain distinct portfolios to reflect their different objectives and the specific securities each tracks.

How can an investor check the specific holdings of SCHP?

Detailed top holdings and sector weight data for SCHP are listed as not available in the provided information. To find the current breakdown, you should consult the official Schwab International website or the latest fund factsheet, which provides more granular and up-to-date portfolio information.

What factors should an investor consider when choosing between these funds?

An investor might compare the inflation-sensitive nature of SCHP with the general market exposure of SCHZ, noting their identical 0.03% expense ratios. Other considerations include the funds' dividend yields and their respective roles as specialised or core holdings in a portfolio. *Disclaimer: This content is for educational purposes only and is not financial advice.*

SCHP vs SCHZ

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

This page compares the Schwab U.S. TIPS ETF (SCHP) and the Schwab US Aggregate Bond ETF (SCHZ). It examines their fees, holdings, dividends and how each fund tracks its market. Both charge a 0.03% expense ratio. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

SCHP

Metric

SCHZ

0.03%

Expense Ratio

0.03%

5.02%

Dividend Yield

4.26%

$16.11B

Net Assets

$10.61B

Holdings

12,535

Aug 5, 2010

Inception Date

Jul 14, 2011

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Index Tracked

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Inflation-Protected Bond

Fund Category

Intermediate Core Bond

Both funds charge the same annual fee.

Shared Top Holdings

These funds do not share any of their top holdings.

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Investment Analysis

SCHP

Pros

Investing in US TIPS with a 0.03% expense ratio provides direct exposure to inflation-linked bonds.
The fund has grown to manage $16.1 billion in assets, reflecting strong institutional and retail interest.
It has been available since 2010, providing a long operational history for a specialist inflation-bond ETF.

Considerations

A 5.02% dividend yield is lower than many alternative fixed-income choices, limiting income appeal.
Its exclusive focus on TIPS means it lacks the diversification offered by broader bond indices.
Key details such as top holdings and sector weights are not available, reducing transparency.

SCHZ

Pros

The fund provides broad exposure to investment-grade US bonds, acting as a core portfolio holding.
It maintains a very low 0.03% expense ratio, which helps minimise ongoing costs for investors.
With $10.6 billion in assets since 2011, the fund has sufficient size for liquidity.

Considerations

A 4.26% dividend yield is modest, which may disappoint investors seeking substantial income generation.
Core aggregate strategies typically have limited upside potential compared to more specialised or riskier bond categories.
The absence of published top holdings and sector weights limits full portfolio analysis for investors.

About SCHP and SCHZ

SCHP (SCHP)

The Schwab U.S. TIPS ETF is designed to help investors protect purchasing power against inflation by holding Treasury Inflation-Protected Securities (TIPS). These U.S. government bonds adjust their principal value based on changes in the Consumer Price Index (CPI), offering a potential hedge against rising prices. With a low expense ratio of 0.03% and substantial net assets of USD 16.11 billion, this fund provides broad exposure to the inflation-protected bond market. Since its inception in August 2010, it has maintained a dividend yield of approximately 5.02%, reflecting current interest rates and inflation expectations. Investors should note that while TIPS generally offer safety relative to equities, their value can fluctuate with interest rates, and returns are not guaranteed.

SCHZ (SCHZ)

The Schwab US Aggregate Bond ETF (SCHZ) is a popular investment vehicle designed to provide broad exposure to the US investment-grade fixed-income market. It aims to track the performance of a diversified basket of bonds, including US government, corporate, and mortgage-backed securities. By holding thousands of individual bonds, this ETF helps spread risk across different issuers and sectors. Investors often consider this fund as a core component of a balanced portfolio, seeking steady income and lower volatility compared to equities. With a very low expense ratio, it offers a cost-effective way to access the bond market. However, like all bond funds, its value can fluctuate with changes in interest rates and credit conditions, meaning returns are not guaranteed.

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SCHP vs SCHZ

Fund Snapshot