Schwab Launches Ultra-Short Term Fixed Income ETF

Charles Schwab’s asset management arm announced Tuesday its first actively managed fixed income exchange-traded fund, the Schwab Ultra-Short Income ETF (NYSE Arca: SCUS), which is expected to start trading around Aug. 13.

With an expense ratio of 0.14%, the Schwab Ultra-Short Income ETF is priced below the industry average of 0.25%, Schwab Asset Management said.

The ETF, designed to fit into a diversified portfolio, will offer access to U.S. dollar-denominated investment-grade bonds from U.S. and foreign issuers and will maintain a portfolio duration of a year or shorter term.

“The Schwab Ultra-Short Income ETF is a notable addition to the Schwab family of ETFs as investors continue to seek out cost-effective, income-producing strategies to help diversify their portfolios,” said David Lafferty, Schwab Asset Management director, product strategy and development.

“With SCUS, the first actively managed offering in our fixed income ETF lineup, we believe investors will benefit from our extensive credit research and portfolio management teams, along with the inherent features of an ETF,” he said.

The Schwab Ultra-Short Income ETF is Schwab Asset Management’s 10th bond ETF and the 31st Schwab ETF overall. Schwab Asset Management managed approximately $1.2 trillion on a discretionary basis and $45.7 billion on a non-discretionary basis on March 31.

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