Schwab US Large-Cap Growth ETF

SCHG

Market cap $52.5B

The Vanguard Growth ETF has been a significant market beater. The Invesco QQQ Trust is heavily tech focused and can sometimes be volatile, but returns have been impressive.

Schwab U.S. Large-Cap Growth ETF™ is a passive ETF that replicates its benchmark with a minimal expense ratio of 0.04%. The declines of recent weeks have brought forward P/Es to more acceptable levels (according to my models). And despite strong expectations, SCHG still shows a premium in its price, in my opinion justified by the sector's competitive ROE.

Schwab U.S. Large-Cap Growth ETF™ offers efficient exposure to top U.S. growth stocks, especially in technology and AI sectors. SCHG boasts strong historical returns, a low 0.04% expense ratio, and a favorable risk-adjusted profile with a Sharpe ratio of 1.68x. The ETF is top-heavy, with over 58% in its top ten holdings, making it vulnerable to tech sector downturns and high valuations.

As temperatures grow cooler, apparently so does the market's immediate-term conviction on some of the year's favorite bets. Consider technology stocks.

Schwab U.S. Large-Cap Growth ETF™ offers low-cost, passive exposure to tech-driven growth, ideal for long-term foundational investing. SCHG's portfolio is heavily weighted toward technology, with Nvidia as its largest holding, and has outperformed many peer ETFs since inception. Despite a higher P/E ratio, SCHG's diversified holdings and qualified distributions make it attractive for both taxable and retirement accounts.

The Schwab U.S. Large-Cap Growth ETF is positioned to benefit from a multi-trillion-dollar AI-driven data center upgrade cycle. SCHG offers a 'set-and-forget' approach for investors seeking exposure to leading U.S. tech companies and the artificial intelligence growth theme. Strong Q3 earnings reports from Magnificent 7 companies could lead to a serious valuation boost for the SCHG.

Designed to provide broad exposure to the Large Cap Growth segment of the US equity market, the Schwab U.S. Large-Cap Growth ETF (SCHG) is a passively managed exchange traded fund launched on December 11, 2009.

Recommend a large cap growth portfolio split between Vanguard Growth Index Fund ETF and Schwab U.S. Large-Cap Growth ETF. SCHG is more forward-looking and tech-anchored, making it a long-term core holding, but is slower to adapt to market shifts than VUG. VUG is more agile, quickly adapting to sector rotations and quality tech, making it tactically overweight in the current volatile, tech-driven market.

The S&P 500 index (^GSPC 0.59%) is a powerhouse, earning total returns of nearly 242% over the last 10 years, as of this writing. While investing in index-tracking funds like an S&P 500 ETF can be a great way to mitigate risk, growth stocks and exchange-traded funds (ETFs) can help supercharge your earnings over time.

Schwab US Large-Cap Growth ETF (SCHG) is upgraded to a buy, reflecting improved economic outlook and reduced political uncertainty. SCHG has outperformed the S&P 500 and Nasdaq-100 over five years, driven by heavy concentration in large-cap tech leaders like NVDA, MSFT, and AAPL. The ETF's strategy of annual reconstitution and sector concentration targets high-performing growth companies, but increases risk due to lack of diversification.