UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-07704
Schwab Capital Trust
(Exact name of registrant as specified in charter)
211 Main Street, San Francisco, California 94105
(Address of principal executive offices) (Zip code)
Jonathan de St. Paer
Schwab Capital Trust
211 Main Street, San Francisco, California 94105
(Name and address of agent for service)
Registrants telephone number, including area code: (415) 636-7000
Date of fiscal year end: October 31
Date of reporting period: April 30, 2022
Item 1: Report(s) to Shareholders.
1 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
2 | The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations. See financial note 2 for more information. |
3 | The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes. |
* | The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes. |
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Christopher Bliss, CFA, Managing Director and Head of Passive Equity Strategies for Schwab Asset Management, is responsible for overseeing the investment process, portfolio management and implementation, and development of investment strategies for passive equity Schwab Funds and Schwab ETFs. Before joining Schwab in 2016, Mr. Bliss spent 12 years at BlackRock (formerly Barclays Global Investors) managing and leading institutional index teams, most recently as a managing director and the head of the Americas institutional index team. In this role, Mr. Bliss was responsible for overseeing a team of portfolio managers managing domestic, developed international and emerging markets index strategies. Prior to BlackRock, he worked as an equity analyst and portfolio manager for Harris Bretall and before that, as a research analyst for JP Morgan. |
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Jeremy Brown, CFA, Portfolio Manager, is responsible for the day-to-day co-management of the funds, except for the Schwab International Index Fund. Prior to joining Schwab in 2017, Mr. Brown spent six years with ALPS Advisors, Inc. in Denver, most recently as a senior analyst on the ETF portfolio management and research team where he performed portfolio management, trading, and analytics/research functions for ALPS ETFs and passive funds. Additionally, Mr. Brown led a number of investment research, commentary, industry trend analysis, and sales and marketing support initiatives. |
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Chuck Craig, CFA, Senior Portfolio Manager, is responsible for the day-to-day co-management of the Schwab International Index Fund. Prior to joining Schwab in 2012, Mr. Craig worked at Guggenheim Funds (formerly Claymore Group), where he spent more than five years as a managing director of portfolio management and supervision, and three years as vice president of product research and development. Prior to that, he worked as an equity research analyst at First Trust Portfolios (formerly Niké Securities), and a trader and analyst at PMA Securities, Inc. |
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Ferian Juwono, CFA, Senior Portfolio Manager, is responsible for the day-to-day co-management of the funds, except for the Schwab International Index Fund. Prior to joining Schwab in 2010, Mr. Juwono worked at BlackRock (formerly Barclays Global Investors) where he spent more than three years as a portfolio manager, managing equity index funds for institutional clients, and two years as a senior business analyst. Prior to that, Mr. Juwono worked for more than four years as a senior financial analyst with Union Bank of California. |
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Jane Qin, Portfolio Manager, is responsible for the day-to-day co-management of the Schwab International Index Fund. Prior to joining Schwab in 2012, Ms. Qin spent more than four years at The Bank of New York Mellon Corporation. During that time, Ms. Qin spent more than two years as an associate equity portfolio manager and nearly two years as a performance analyst. She also worked at Wells Fargo Funds Management as a mutual fund analyst and at CIGNA Reinsurance in the risk management group as a risk analyst. |
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David Rios, Portfolio Manager, is responsible for the day-to-day co-management of the Schwab International Index Fund. Prior to this role, Mr. Rios was an associate portfolio manager on the equity index strategies team for four years. His first role with Schwab Asset Management was as a trade operations specialist. Prior to joining Schwab in 2008, Mr. Rios was a senior fund accountant at Investors Bank & Trust (subsequently acquired by State Street Corporation). |
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Sabya Sinha, Portfolio Manager, is responsible for the day-to-day co-management of the funds, except for the Schwab International Index Fund. Prior to joining Schwab in 2015, Mr. Sinha spent a year at F-Squared Investments on the product development and analytics team. Prior to F-Squared, he worked at IndexIQ Advisors as a senior index portfolio manager for three years and for Bank of America’s Columbia Management subsidiary as a portfolio manager for three years. Mr. Sinha also spent time as a software consultant at DPM Mellon, LLC and an equity trader at Jane Street Capital. |
Fund and Inception Date | 6 Months | 1 Year | 5 Years | 10 Years |
Fund: Schwab S&P 500 Index Fund (5/19/97) | -9.66% | 0.19% | 13.63% | 13.60% |
S&P 500® Index | -9.65% | 0.21% | 13.66% | 13.67% |
Fund Category: Morningstar Large Blend2 | -9.87% | -1.68% | 11.99% | 12.20% |
Fund Expense Ratio3: 0.02% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
3 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | Not annualized. |
3 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
4 | This list is not a recommendation of any security by the investment adviser. |
Fund and Inception Date | 6 Months | 1 Year | 5 Years | 10 Years |
Fund: Schwab 1000 Index Fund (4/2/91) | -11.58% | -2.37% | 13.24% | 13.23% |
Schwab 1000 Index® | -11.56% | -2.34% | 13.27% | 13.39% |
Russell 1000® Index | -11.29% | -2.10% | 13.44% | 13.53% |
Fund Category: Morningstar Large Blend2 | -9.87% | -1.68% | 11.99% | 12.20% |
Fund Expense Ratio3: 0.05% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
3 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | As a result of the Schwab 1000 Index®’s once per year reconstitution and the effects of certain corporate actions, the fund may hold more or less than 1,000 securities. |
3 | Not annualized. |
4 | Less than 0.5%. |
5 | Portfolio turnover rate excludes in-kind transactions. |
6 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
7 | This list is not a recommendation of any security by the investment adviser. |
Fund and Inception Date | 6 Months | 1 Year | 5 Years | 10 Years |
Fund: Schwab Small-Cap Index Fund (5/19/97) | -18.36% | -16.84% | 7.30% | 10.11% |
Russell 2000® Index | -18.38% | -16.87% | 7.24% | 10.06% |
Fund Category: Morningstar Small Blend2 | -12.59% | -9.66% | 7.41% | 9.91% |
Fund Expense Ratio3: 0.04% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
3 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | Not annualized. |
3 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
4 | This list is not a recommendation of any security by the investment adviser. |
Fund and Inception Date | 6 Months | 1 Year | 5 Years | 10 Years |
Fund: Schwab Total Stock Market Index Fund (6/1/99) | -11.97% | -3.37% | 12.88% | 13.16% |
Dow Jones U.S. Total Stock Market IndexSM | -11.98% | -3.36% | 12.92% | 13.20% |
Fund Category: Morningstar Large Blend2 | -9.87% | -1.68% | 11.99% | 12.20% |
Fund Expense Ratio3: 0.03% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
3 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | Not annualized. |
3 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
4 | This list is not a recommendation of any security by the investment adviser. |
Fund and Inception Date | 6 Months | 1 Year | 3 Years | Since Inception |
Fund: Schwab U.S. Large-Cap Growth Index Fund (12/20/17) | -17.86% | -5.39% | 16.62% | 15.61% |
Russell 1000® Growth Index | -17.84% | -5.35% | 16.68% | 15.67% |
Fund Category: Morningstar Large Growth2 | -21.15% | -12.09% | 12.19% | N/A |
Fund Expense Ratio3: 0.035% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
3 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | Not annualized. |
3 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
4 | Less than 0.05%. |
5 | This list is not a recommendation of any security by the investment adviser. |
Fund and Inception Date | 6 Months | 1 Year | 3 Years | Since Inception |
Fund: Schwab U.S. Large-Cap Value Index Fund (12/20/17) | -3.95% | 1.28% | 9.50% | 7.98% |
Russell 1000® Value Index | -3.94% | 1.32% | 9.58% | 8.07% |
Fund Category: Morningstar Large Value2 | -2.30% | 3.13% | 10.25% | N/A |
Fund Expense Ratio3: 0.035% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
3 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | Not annualized. |
3 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
4 | This list is not a recommendation of any security by the investment adviser. |
Fund and Inception Date | 6 Months | 1 Year | 3 Years | Since Inception |
Fund: Schwab U.S. Mid-Cap Index Fund (12/20/17) | -12.53% | -6.13% | 10.44% | 9.51% |
Russell Midcap® Index | -12.54% | -6.10% | 10.48% | 9.56% |
Fund Category: Morningstar Mid-Cap Blend2 | -9.48% | -5.53% | 9.55% | N/A |
Fund Expense Ratio3: 0.04% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
3 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | Not annualized. |
3 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
4 | This list is not a recommendation of any security by the investment adviser. |
Fund and Inception Date | 6 Months | 1 Year | 5 Years | 10 Years |
Fund: Schwab International Index Fund (5/19/97) | -12.76% | -8.88% | 4.64% | 5.69% |
MSCI EAFE® Index (Net)3 | -11.80% | -8.15% | 4.77% | 5.77% |
International Spliced Index | -11.80% | -8.15% | 4.77% | 5.81% |
Fund Category: Morningstar Foreign Large Blend4 | -12.88% | -10.29% | 4.37% | 5.34% |
Fund Expense Ratio5: 0.06% |
1 | Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
2 | The fund’s performance relative to the index may be affected by fair-value pricing. See financial note 2 for more information. |
3 | The net version of the index reflects reinvested dividends net of withholding taxes but reflects no deductions for expenses or other taxes. |
4 | Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date. |
5 | As stated in the prospectus. |
1 | Excludes derivatives. |
2 | Not annualized. |
3 | This list is not a recommendation of any security by the investment adviser. |
4 | The percentage may differ from the Portfolio Holdings because the above calculation is based on a percentage of total investments, excluding derivatives, whereas the calculation in the Portfolio Holdings is based on a percentage of net assets. |
EXPENSE
RATIO (ANNUALIZED) 1 |
BEGINNING
ACCOUNT VALUE AT 11/1/21 |
ENDING
ACCOUNT VALUE (NET OF EXPENSES) AT 4/30/22 |
EXPENSES
PAID DURING PERIOD 11/1/21-4/30/222 | |
Schwab S&P 500 Index Fund | ||||
Actual Return | 0.02% | $1,000.00 | $ 903.40 | $0.09 |
Hypothetical 5% Return | 0.02% | $1,000.00 | $1,024.70 | $0.10 |
Schwab 1000 Index Fund | ||||
Actual Return | 0.05% | $1,000.00 | $ 884.20 | $0.23 |
Hypothetical 5% Return | 0.05% | $1,000.00 | $1,024.55 | $0.25 |
Schwab Small-Cap Index Fund | ||||
Actual Return | 0.04% | $1,000.00 | $ 816.40 | $0.18 |
Hypothetical 5% Return | 0.04% | $1,000.00 | $1,024.60 | $0.20 |
Schwab Total Stock Market Index Fund | ||||
Actual Return | 0.03% | $1,000.00 | $ 880.30 | $0.14 |
Hypothetical 5% Return | 0.03% | $1,000.00 | $1,024.65 | $0.15 |
Schwab U.S. Large-Cap Growth Index Fund | ||||
Actual Return | 0.035% | $1,000.00 | $ 821.40 | $0.16 |
Hypothetical 5% Return | 0.035% | $1,000.00 | $1,024.62 | $0.18 |
Schwab U.S. Large-Cap Value Index Fund | ||||
Actual Return | 0.035% | $1,000.00 | $ 960.50 | $0.17 |
Hypothetical 5% Return | 0.035% | $1,000.00 | $1,024.62 | $0.18 |
Schwab U.S. Mid-Cap Index Fund | ||||
Actual Return | 0.04% | $1,000.00 | $ 874.70 | $0.19 |
Hypothetical 5% Return | 0.04% | $1,000.00 | $1,024.60 | $0.20 |
Schwab International Index Fund | ||||
Actual Return | 0.06% | $1,000.00 | $ 872.40 | $0.28 |
Hypothetical 5% Return | 0.06% | $1,000.00 | $1,024.50 | $0.30 |
1 | Based on the most recent six-month expense ratio. |
2 | Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year. |
11/1/21–
4/30/22* |
11/1/20–
10/31/21 |
11/1/19–
10/31/20 |
11/1/18–
10/31/19 |
11/1/17–
10/31/18 |
11/1/16–
10/31/17 | |
Per-Share Data | ||||||
Net asset value at beginning of period | $71.21 | $50.75 | $47.17 | $42.41 | $40.23 | $33.38 |
Income (loss) from investment operations: | ||||||
Net investment income (loss)1 | 0.49 | 0.90 | 1.02 | 0.92 | 0.80 | 0.74 |
Net realized and unrealized gains (losses) | (7.25) | 20.60 | 3.52 | 4.86 | 2.12 | 6.99 |
Total from investment operations | (6.76) | 21.50 | 4.54 | 5.78 | 2.92 | 7.73 |
Less distributions: | ||||||
Distributions from net investment income | (0.86) | (1.04) | (0.87) | (0.84) | (0.72) | (0.69) |
Distributions from net realized gains | (0.07) | — | (0.09) | (0.18) | (0.02) | (0.19) |
Total distributions | (0.93) | (1.04) | (0.96) | (1.02) | (0.74) | (0.88) |
Net asset value at end of period | $63.52 | $71.21 | $50.75 | $47.17 | $42.41 | $40.23 |
Total return | (9.66%) 2 | 42.89% | 9.69% | 14.30% | 7.29% | 23.57% |
Ratios/Supplemental Data | ||||||
Ratios to average net assets: | ||||||
Total expenses | 0.02% 3 | 0.02% | 0.02% | 0.02% 4 | 0.03% | 0.05% 5 |
Net operating expenses | N/A | N/A | N/A | N/A | N/A 6 | 0.05% 5 |
Net investment income (loss) | 1.40% 3 | 1.42% | 2.11% | 2.11% | 1.88% | 2.01% |
Portfolio turnover rate | 1% 2 | 3% | 4% | 3% | 2% | 2% |
Net assets, end of period (x 1,000,000) | $63,594 | $67,401 | $44,184 | $40,232 | $34,410 | $29,999 |
* | Unaudited. |
1 | Calculated based on the average shares outstanding during the period. |
2 | Not annualized. |
3 | Annualized. |
4 | Effective December 20, 2018, the annual operating expense ratio was reduced to 0.02%. The ratio presented for period ended 10/31/19 is a blended ratio. |
5 | Effective March 1, 2017, the annual operating expense ratio was reduced. The ratio presented for period ended 10/31/17 is a blended ratio. |
6 | Effective March 1, 2017, the fund instituted a new fee structure and the contractual expense limitation was terminated. |
VALUE
AT 10/31/21 |
PURCHASES | SALES | REALIZED
GAINS (LOSSES) |
NET
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) |
VALUE
AT 4/30/22 |
BALANCE
OF SHARES HELD AT 4/30/22 |
DIVIDENDS
RECEIVED | |
COMMON STOCKS 0.3% OF NET ASSETS | ||||||||
Diversified Financials 0.3% | ||||||||
The Charles Schwab Corp. | $210,537,870 | $13,291,123 | ($445,373) | ($5,215) | ($43,083,781) | $180,294,624 | 2,718,146 | $1,006,175 |
DESCRIPTION | QUOTED
PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1) |
OTHER
SIGNIFICANT OBSERVABLE INPUTS (LEVEL 2) |
SIGNIFICANT
UNOBSERVABLE INPUTS (LEVEL 3) |
TOTAL |
Assets | ||||
Common Stocks1 | $63,292,904,445 | $— | $— | $63,292,904,445 |
Short-Term Investments1 | — | 219,125,946 | — | 219,125,946 |
Liabilities | ||||
Futures Contracts2 | (18,686,779) | — | — | (18,686,779) |
Total | $63,274,217,666 | $219,125,946 | $— | $63,493,343,612 |
1 | As categorized in the Portfolio Holdings. |
2 | Futures contracts are reported at cumulative unrealized appreciation or depreciation. |
Assets | ||
Investments in securities, at value - affiliated (cost $83,576,481) | $180,294,624 | |
Investments in securities, at value - unaffiliated (cost $28,830,059,646) | 63,331,735,767 | |
Deposit with broker for futures contracts | 22,310,400 | |
Receivables: | ||
Fund shares sold | 81,380,562 | |
Dividends | 49,957,403 | |
Interest | + | 2,374 |
Total assets | 63,665,681,130 | |
Liabilities | ||
Payables: | ||
Fund shares redeemed | 60,846,153 | |
Variation margin on futures contracts | 10,043,123 | |
Investment adviser fees | + | 1,152,379 |
Total liabilities | 72,041,655 | |
Net assets | $63,593,639,475 | |
Net Assets by Source | ||
Capital received from investors | $29,073,542,747 | |
Total distributable earnings | + | 34,520,096,728 |
Net assets | $63,593,639,475 |
Net Asset Value (NAV) | ||||
Net Assets | ÷ | Shares
Outstanding |
= | NAV |
$63,593,639,475 | 1,001,178,636 | $63.52 | ||
For the period November 1, 2021 through April 30, 2022; unaudited | ||
Investment Income | ||
Dividends received from securities - affiliated | $1,006,175 | |
Dividends received from securities - unaffiliated (net of foreign withholding tax of $99,561) | 483,053,176 | |
Interest received from securities - unaffiliated | 52,459 | |
Securities on loan, net | + | 18,348 |
Total investment income | 484,130,158 | |
Expenses | ||
Investment adviser fees | 6,815,726 | |
Total expenses | – | 6,815,726 |
Net investment income | 477,314,432 | |
REALIZED AND UNREALIZED GAINS (LOSSES) | ||
Net realized losses on sales of securities - affiliated | (5,215) | |
Net realized losses on sales of securities - unaffiliated | (13,016,693) | |
Net realized gains on futures contracts | + | 5,455,094 |
Net realized losses | (7,566,814) | |
Net change in unrealized appreciation (depreciation) on securities - affiliated | (43,083,781) | |
Net change in unrealized appreciation (depreciation) on securities - unaffiliated | (7,171,803,411) | |
Net change in unrealized appreciation (depreciation) on futures contracts | + | (33,516,331) |
Net change in unrealized appreciation (depreciation) | + | (7,248,403,523) |
Net realized and unrealized losses |