Schwab Asset Management has launched its first actively managed fixed income ETF, adding to its already substantial lineup of ETFs, the firm announced today.
The ETF, the Schwab Ultra-Short Income ETF, will provide access to the U.S. dollar denominated investment grade, short-term bond market and is designed to serve as part of a diversified portfolio, Schwab said. The first day of trading is expected to be around Aug. 13.
With an expense ratio of 0.14%, the ETF will be priced below the industry average of 0.25%, Schwab said.
“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,” David Lafferty, director of product strategy and development at Schwab Asset Management, said in a statement. “With the new ETF, (which is) 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.”
The new ETF is designed to create current income consistent with capital preservation while maintaining liquidity. The ETF invests in investment grade, short-term, U.S. dollar denominated debt securities issued by U.S. and foreign issuers and will maintain a portfolio duration of one year or less, Schwab said.
Schwab Asset Management is the fifth-largest provider of ETFs and the new ETF is tenth bond ETF and the 31st Schwab ETF overall. Schwab bond ETFs seek to be among the lowest cost across the industry’s leading ETF providers, Schwab said. The firm’s last launch was a high-yield bond ETF launched in July 2023.