Schwab Announces New Personalization and Digital Capabilities for Schwab Personalized Indexing™

Personalization takes a step forward with new enhancements

Charles Schwab today announced new enhancements to Schwab Personalized Indexing™, its direct indexing solution with tax-loss harvesting and portfolio management capabilities. The enhancements include new options for portfolio customization and digital capabilities for retail clients who work with a Schwab financial consultant. Similar enhancements are anticipated to be available to independent advisors who custody with Schwab later this year.

Clients in Schwab Personalized Indexing can now exclude more individual stocks as well as entire industries and sub-industries. The maximum number of exclusions will be guided by a predictive tracking error tool that provides an indication of how a portfolio is expected to perform relative to its reference index.

Retail clients also now have access to a personal, account-level digital dashboard through their Schwab.com account overview that provides a real-time view of their account value. The dashboard also highlights the performance of Schwab Personalized Indexing’s proprietary tax-loss harvesting algorithms through modules that show daily after-tax performance – including total realized gains and losses generated in the account – and the daily estimated account after-tax return. The new digital experience differentiates Schwab Personalized Investing by providing retail clients with deeper insights to help achieve their financial objectives.

Also on the digitization front, enrollment through Schwab financial consultants has been digitized for individual retail accounts, making enrollment in Schwab Personalized Indexing faster and easier. Digitized enrollment is anticipated to be available to more account types throughout 2023.

“We have seen strong adoption of Schwab Personalized Indexing since its launch last year and we are excited to introduce new customizations to further address unique client preferences or situations – such as concentrated stock positions or values-based exclusions – and to make investing a more personal experience,” said Divya Krishnan, Director, Schwab Product Management. “The new digital tools are designed to add transparency and accessibility to valuable account information and analysis, setting Schwab Personalized Indexing apart from competitors. We look forward to delivering enhancements to our RIA clients later this year, as well as adding more innovative direct indexing capabilities over time.”

Schwab Personalized Indexing, which launched nearly one year ago in April 2022, utilizes technology with human oversight to monitor client portfolios and identify tax-loss opportunities on a daily basis. It leverages a proprietary optimization process managed by a team of investment professionals that brings more than two decades of cumulative direct indexing experience.

Schwab Personalized Indexing has an account minimum of $100,000 — lower than most direct indexing offerings on the market which typically start at $250,000 or higher — yet at an account size that still provides the opportunity for meaningful tax benefits to the client.

For more information about Schwab Personalized Indexing visit https://www.schwab.com/direct-indexing.

About Schwab Asset Management

One of the industry’s largest and most experienced asset managers, Schwab Asset Management offers a focused lineup of competitively priced ETFs, mutual funds and separately managed account strategies designed to serve the central needs of most investors. By operating through clients’ eyes, and putting them at the center of our decisions, we aim to deliver exceptional experiences to investors and the financial professionals who serve them. As of December 31, 2022, Schwab Asset Management managed approximately $724.0 billion on a discretionary basis and $33.7 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 investing to help individuals create a better tomorrow. We have a history of challenging the status quo in our industry, innovating in ways that benefit investors and the advisors and employers who serve them, and championing our clients’ goals with passion and integrity.

More information is available at www.aboutschwab.com. Follow us on Twitter, Facebook, YouTube and LinkedIn.

Disclosures:

This information is not intended to be a substitute for specific individualized tax, legal or investment planning advice.

Neither the tax-loss harvesting strategy nor any discussion herein is intended as tax advice, and Schwab Asset Management does not represent that any particular tax consequences will be obtained. Tax-loss harvesting involves certain risks including unintended tax implications. Investors should consult with their tax advisors and refer to Internal Revenue Service (“IRS”) website at www.irs.gov about the consequences of tax-loss harvesting.

Schwab Personalized Indexing is available through Schwab's Managed Account Connection^® program ("Connection"). Please read Schwab's Disclosure Brochure for important information and disclosures relating to Connection and Schwab Managed Account Services.

Diversification and asset allocation strategies do not ensure a profit and cannot protect against losses in a declining market.

Please refer to the Charles Schwab Investment Management, Inc. Disclosure Brochure for additional information.

Portfolio Management for Schwab Personalized Indexing is provided by Charles Schwab Investment Management, Inc., dba Schwab Asset Management, a registered investment adviser and an affiliate of Charles Schwab & Co., Inc. ("Schwab"). Both Schwab Asset Management and Schwab are separate entities and subsidiaries of The Charles Schwab Corporation.

There are risks associated with any investment approach, and each Schwab Personalized Indexing strategy and equity market segment has their own set of risks based on client strategy selection and further customization.

Strategies that use screening to exclude certain investments may not be able to take advantage of the same opportunities or market trends as strategies that do not use screens. There can be no assurance that the strategies will achieve their desired outcomes. Each investing strategy brings with it its own set of unique risks and benefits.

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