The Schwab Total Stock Market Index Select Class (MUTF: SWTSX) mutual fund invests in stocks that mirror the returns of the broader stock market as measured by the Dow Jones U.S. Total Stock Market index. As an “index fund,” it has rock-bottom costs that mean investors aren’t paying extra for active management.
Here are the specifics for the Fidelity Global Commodity Stock Fund for today’s mutual fund spotlight:
Investing Strategy: Simply put, buying the Schwab Total Stock Market Index Select Class Fund is like buying the Dow Jones index to which it is pegged. More than 98% of its assets are in stocks included in the Dow Jones U.S. Total Stock Market Index. The fund suits investors who like knowing where their investment stands with a simple glance at the broader market like the Dow Jones Industrial Average, and who don’t necessarily think active management can generate significantly better returns. This is a good fund for folks who want to “buy the market.”
Expense Ratio: With a .09 % expense ratio, the Schwab Total Stock Market Index Select CL fund is extremely cheap because it relies heavily on computer models to help decide which securities to buy and sell based on the index. Note it has a $75 transaction fee, however.
Top 5 Holdings: The top stocks in the Schwab Total Stock Market Index Select Class fund includes oil giant ExxonMobil Corporation (NYSE: XOM) at 2.71% , mass media giant Apple, Inc. (NYSE: AAPL) at 2.08%, industrials conglomerate General Electric Company (NYSE: GE) at 1.43%, and technology icons Microsoft Corporation (NASDAQ: MSFT) at 1.41% and International Business Machines Corp (NYSE: IBM) at 1.35%.
Returns: The one-year return of the Schwab Total Stock Market Index Select CL fund is 18.6 %, slightly better than the 18.2% return for the Dow Jones Industrial Average and S&P 500’s 17.1% return over the same period. But don’t expect this fund to ever significantly differ than the market, since you’re buying an index via the Schwab Total Stock Market mutual fund. For instance, its 5-year return of 8.4% also beats the S&P 500’ 3% return during the period, but lags the Dow’s 10.3% 5-year performance.
Other Fund Statistics
- Total Assets: $1.9 Billion (as of 5/17/11)
- Minimum Investment: $2,500
- Fund manager: Larry M. Mano
- Manager’s Tenure: Since June 1999
