WESTLAKE, Texas–(BUSINESS WIRE)–Schwab Asset Management, the asset management arm of The Charles Schwab Corporation, today announced the launch of the Schwab Crypto Thematic ETF (NYSE Arca: STCE). The first day of trading is expected to take place on or around August 4, 2022. The fund is designed to track Schwab Asset Management’s new proprietary index, the Schwab Crypto Thematic Index, providing investors with global exposure to companies that stand to benefit from the development or use of cryptocurrencies and other digital assets. With an annual operating expense ratio of 0.30%, STCE will be the cheapest crypto ETF available to investors today.1
“For investors interested in cryptocurrency exposures, there’s a whole ecosystem to consider as more and more businesses seek to derive revenue from crypto directly and indirectly,” said David Botset, Managing Director, Head of Equity Product Management and Innovation at Schwab Asset Management. “The Schwab Crypto Thematic ETF seeks to provide access to the growing global crypto ecosystem along with the benefits of transparency and low cost that investors and advisors have come to expect from Schwab ETFs.”
The objective of the Schwab Crypto Thematic ETF is to track as closely as possible, before fees and expenses, the total return of the Schwab Crypto Thematic Index. Developed by Schwab Asset Management’s thematic research team, the index uses the powerful combination of human insight; artificial intelligence technology acquired through the acquisition of Motif, a leader in thematic investing; and systematic models to identify, select, measure and weight companies based on their relevance to the crypto-related theme.
The index does not directly track or invest in cryptocurrencies. Rather, it is designed to provide global exposure to companies that can benefit from one or more of the following business activities: either directly or by facilitating validation of consensus mechanisms for (such as mining or staking) investing or trading cryptocurrencies or other assets; enable the use of cryptocurrency or other digital assets to buy or sell goods or services; and develop, distribute or implement applications of blockchain or other distributed ledger technologies, including in new cryptocurrencies or digital assets.
The fifth largest ETF provider2, Schwab Asset Management has over a decade of ETF management experience and a strong capital markets team that plays a crucial role in ensuring the effective operation of Schwab ETFs. Schwab also has a long history in indexing, having launched its first proprietary index, the Schwab 1000 Index.®in 1991.
About Schwab Asset Management
One of the largest and most experienced asset managers in the industry, Schwab Asset Management offers a focused range of ETFs, mutual funds and separately managed account strategies at competitive prices, designed to meet the essential needs of most investors. By operating through the eyes of clients and putting them at the center of our decisions, we aim to deliver exceptional experiences for investors and the finance professionals who serve them. As of June 30, 2022, Schwab Asset Management managed approximately $575.9 billion on a discretionary basis and $34.4 billion on a non-discretionary basis. More information is available at www.schwabassetmanagement.com.
About Charles Schwab
At Charles Schwab, we believe in the power of investment to help people create a better future. We are accustomed to challenging the status quo in our industry, innovating in ways that benefit the investors, advisors and employers who serve them, and championing our clients’ goals with passion and integrity.
Investors should carefully review the information contained in the prospectus or, if available, the simplified prospectus, including the investment objectives, risks, charges and expenses. You can obtain a prospectus or, if available, a simplified prospectus by visiting schwabassetmanagement.com/prospectus. Please read it carefully before investing.
Investment returns fluctuate and are subject to market volatility, so an investor’s shares, when redeemed or sold, may be worth more or less than their original cost. Unlike mutual funds, ETF shares are not individually redeemable directly from the ETF. ETF shares are bought and sold at market price, which may be higher or lower than the net asset value (NAV).
The fund will not invest directly in cryptocurrencies or digital assets. It invests in companies listed in the Schwab Crypto Thematic Index and is designed to provide global exposure to companies that stand to benefit from the development or use of cryptocurrencies (including bitcoin) and other digital assets, as well as business activities related to blockchain and other distributed ledgers. Technology.
The fund is non-diversified, which means that it may invest in the securities of a relatively small number of issuers. Therefore, a single adverse economic or regulatory event may have a greater effect on the fund’s investments, and the fund may experience increased volatility.
Technology relating to digital assets, including blockchain, is new and in development and the risks associated with digital assets may not fully emerge until the technology is widely used. Additionally, the values of the companies included in the fund may not reflect their connection to digital assets, but may be based on other business operations or industries, which means that the operating results of these companies may not be materially related to their respective digital asset businesses.
The fund invests in a portfolio of securities based on a theme and its performance may suffer if that theme is not correctly identified or if the theme develops unexpectedly. Performance may also suffer if the securities included in the index do not benefit from the development of such a theme.
International investments involve additional risks, including differences in financial accounting standards, currency fluctuations, geopolitical risk, foreign taxes and regulations, and the potential for illiquid markets. Investing in emerging markets may heighten these risks.
The Schwab Crypto Thematic Index was developed by Charles Schwab Investment Management, Inc. and is designed to provide global exposure to companies that can benefit from one or more of the following business activities: either directly or by facilitating the validation of mechanisms consensus building for (such as mining or staking), investing or trading in cryptocurrency or other digital assets; enable the use of cryptocurrency or other digital assets to buy or sell goods and services; or develop, distribute or implement applications of blockchain or other distributed ledger technologies, including in new cryptocurrencies or digital assets. For the complete and current index methodology, please see schwabassetmanagement.com/products/stce.
Schwab Asset Management™ is the dba name for Charles Schwab Investment Management, Inc. (CSIM), the investment advisor for Schwab ETFs. Schwab ETFs are distributed by SEI Investments Distribution Co. (SIDCO). Schwab Asset Management is a separate but affiliated company and subsidiary of The Charles Schwab Corporation, and is not affiliated with SIDCO.
1 Source: Based on crypto-focused ETFs in the “Digital Economy” niche category of ETF.com ECS, June 30, 2022.
2 Source: etfdb.com, “ETF Issuer AUM League Table”, July 18, 2022.