Looking for broad exposure to the Large Cap Growth segment of the US equity market? You should consider the Schwab U.S. Large-Cap Growth ETF (SCHG), a passively managed exchange traded fund launched on December 11, 2009.
The fund is sponsored by Charles Schwab. It has amassed assets over $53.27 billion, making it one of the largest ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Additionally, growth stocks have a greater level of risk associated with them. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all markets.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.04%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.36%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector -- about 45.4% of the portfolio. Telecom and Consumer Discretionary round out the top three.
Looking at individual holdings, Nvidia Corp (NVDA) accounts for about 10.42% of total assets, followed by Apple Inc (AAPL) and Microsoft Corp (MSFT).
The top 10 holdings account for about 58.06% of total assets under management.
Performance and Risk
SCHG seeks to match the performance of the Dow Jones U.S. Large-Cap Growth Total Stock Market Index before fees and expenses. The Dow Jones U.S. Large-Cap Growth Total Stock Market Index is float-adjusted market-capitalization weighted and includes the large-cap growth portion of the Dow Jones U.S. Total Stock Market Index.
The ETF has added about 18.4% so far this year and was up about 17.26% in the last one year (as of 12/31/2025). In the past 52-week period, it has traded between $22.27 and $33.69.
The ETF has a beta of 1.18 and standard deviation of 19.36% for the trailing three-year period, making it a medium risk choice in the space. With about 197 holdings, it effectively diversifies company-specific risk.
Alternatives
Schwab U.S. Large-Cap Growth ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SCHG is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG) and the Invesco QQQ (QQQ) track a similar index. While Vanguard Growth ETF has $203.68 billion in assets, Invesco QQQ has $408.12 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.2%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Schwab U.S. Large-Cap Growth ETF (SCHG): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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