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Costs of Investing:
A Breakdown

It's not always easy to get a handle on your investing costs. Depending on where you invest, it might be difficult to get a good understanding of what the costs are and what investors might expect to pay for them. We believe it shouldn't be that way. You should always know what you’re paying—and finding that information should be easy.

Stocks and Options

What are the costs? What you pay with Schwab
Trade Commissions
Every time you buy or sell a stock or option, your brokerage company may charge you a trade commission. This includes costs for routing, executing, and clearing the trade. 
US$0 commissions on online stock and options trades.1
+
US$0.65 per options contract.2

stocks and options disclosure

Offshore Mutual Funds

What are the costs? What you pay with Schwab
Operating Expense Ratio (OER)
OERs are charged annually by the fund company, expressed as a percentage of a fund's average net assets. They cover the fund's management and other costs. 

Passively managed funds are designed to track a specific market index and typically have lower costs (OERs) than actively managed funds that pay fund managers or management teams to make ongoing decisions on where a fund's money is invested.
OERs vary from fund to fund.    
Load
When you purchase or redeem shares in certain load-based offshore mutual funds, some fund companies charge you this one-time commission to compensate the broker for the sale.
US$0 Schwab waives sales loads charged by fund companies.
Transaction Fee
When you purchase or redeem an offshore mutual fund, your brokerage company may charge you a trade fee. This fee may also be used to compensate the brokerage in instances where it does not receive compensation from the fund.
US$0 No transaction fee is charged at Schwab  

Exchange-traded Funds

What are the costs? What you pay with Schwab
Operating Expense Ratio (OER)
OERs are charged annually by the fund company, expressed as a percentage of a fund's average net assets. They cover the fund's management and other costs.

Passively managed funds are designed to track a specific market index and typically have lower costs (OERs) than actively managed funds that pay fund managers or management teams to make ongoing decisions on where a fund's money is invested.
Passively managed ETFs

Schwab ETFs™*3 
The asset-weighted average OER for passively managed ETFs is 0.05%.4 Expenses can range from 0.03%-0.13%.

Third-party passively managed ETFs traded on US exchanges are also available. OERs vary from fund to fund.

Actively managed ETFs 
Schwab offers third-party actively managed ETFs traded on U.S exchanges. OERs vary from fund to fund. 
Trade Commission (online) 
Your broker may charge you a trade commission each time you buy or sell an ETF.
US$0 online for any ETFs, including Schwab ETFs5
Other Costs
Bid/ask spreads and changes in discounts and premiums can also factor into your trade costs. 
Costs vary from fund to fund.

*About Schwab ETFs - Schwab ETFs are distributed by SEI Investments Distribution Co.

ETFs disclosure

Bonds

What are the costs? What you pay with Schwab
Price Markup 
Generally, this is the difference between the market price of the bond and the price at which it's sold to you, including transaction fees.
US$1 per bond transaction fee for most secondary market bonds traded online (US$10 minimum/US$250 maximum).6

Bonds disclosure

Portfolio Management Fees

What are the costs? What you pay with Schwab
Annual Portfolio Management Fees
If you choose to have your portfolio of investments professionally managed or to obtain advice for a fee, there may be additional periodic costs. Usually based on a percentage of your assets, the costs can vary depending on the level of assets held in your portfolio and the level of service you receive. 

Keep in mind that you may also be paying investment costs specific to the underlying assets in your portfolio, such as ETF or trade commissions.
Dedicated financial advice7
Starts at 0.80% for Schwab Private Client™8

(Fee rates decrease at higher asset levels) 

Portfolio Management fees disclosure


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