Schwab U.S. Aggregate Bond ETF (SCHZ): Complete Beginner's Guide
Last updated: March 2026 • Schwab • Total Bond Market
Expense Ratio
0.03%
AUM
$8.0B
Dividend Yield
3.40%
Inception
2011
Beginner Score
10/10
What is Schwab U.S. Aggregate Bond ETF?
SCHZ tracks the Bloomberg U.S. Aggregate Bond Index, giving investors exposure to the entire U.S. investment-grade bond market including Treasuries, corporates, and mortgage-backed securities. It serves as a one-stop shop for bond exposure at a very low cost. Beginners often pair SCHZ with a broad stock ETF to build a complete, balanced portfolio with just two funds.
SCHZ is managed by Schwab and has been available since 2011. With $8.0B in assets under management, it's a growing fund that has attracted significant investor interest. The fund charges an expense ratio of 0.03%, which means for every $10,000 you invest, you pay approximately $3 per year in management fees.
SCHZ at a Glance — Key Metrics
| Expense Ratio | 0.03% |
| Total Holdings | 6,000 |
| P/E Ratio | N/A |
| Beta | 0.12 |
| Dividend Yield | 3.40% |
| AUM | $8.0B |
| Inception Year | 2011 |
| Issuer | Schwab |
Top 10 Holdings in SCHZ
SCHZ holds 6,000 different securities. Here are the largest positions that make up the core of this fund:
| # | Company | Ticker | Weight |
|---|---|---|---|
| 1 | U.S. Treasury 4.0% 2033 | GOVT | 2.50% |
| 2 | U.S. Treasury 3.875% 2043 | GOVT | 2.20% |
| 3 | U.S. Treasury 4.25% 2031 | GOVT | 2.00% |
| 4 | Fannie Mae 4.0% MBS | FNMA | 1.80% |
| 5 | Ginnie Mae 4.5% MBS | GNMA | 1.60% |
| 6 | U.S. Treasury 3.5% 2053 | GOVT | 1.50% |
| 7 | Freddie Mac 3.5% MBS | FHLMC | 1.30% |
| 8 | Federal Home Loan Bank 4.0% | FHLB | 1.10% |
| 9 | JPMorgan Chase & Co. 4.25% 2032 | JPM | 0.90% |
| 10 | Bank of America 4.0% 2031 | BAC | 0.80% |
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SCHZ Performance History
Here's how SCHZ has performed over different time periods. Remember that past performance doesn't guarantee future results, but it gives you a sense of the fund's track record:
YTD
0.80%
1 Year
4.00%
3 Year
1.20%
5 Year
1.00%
10 Year
2.00%
Beginner Suitability Score: 10/10
Our proprietary Beginner Suitability Score evaluates ETFs based on five factors that matter most to new investors: fees, volatility, diversification, dividend history, and track record length.
SCHZ scores 10/10 because it has very low fees, shows lower-than-average volatility, offers broad diversification across 6,000 holdings, and has been available since 2011, giving it a proven track record.
How to Buy SCHZ — Step by Step
- Open a brokerage account — We recommend Fidelity, Charles Schwab, or Vanguard for ETF investing. All offer $0 commissions on ETF trades.
- Fund your account — Transfer money from your bank. You can start with as little as $1 if your broker offers fractional shares.
- Search for "SCHZ" — Use the search bar in your brokerage platform to find Schwab U.S. Aggregate Bond ETF.
- Place your order — Choose "Market Order" for simplicity or "Limit Order" if you want to set a specific price. Enter how many shares (or dollar amount) you want to buy.
- Set up automatic investing — Most brokers let you schedule recurring purchases (e.g., $100/month on the 1st). This is dollar cost averaging in action.
Dollar Cost Averaging Into SCHZ
Here's what consistent monthly investing could look like over time, assuming an average annual return of 8% (approximate historical stock market average):
| Monthly | 10 Years | 20 Years | 30 Years |
|---|---|---|---|
| $100/mo | $18,417 | $59,295 | $150,030 |
| $250/mo | $46,041 | $148,237 | $375,074 |
| $500/mo | $92,083 | $296,474 | $750,148 |
*Projections assume 8% average annual return with monthly compounding. Actual returns will vary. Past performance doesn't guarantee future results.
Fee impact: With SCHZ's expense ratio of 0.03%, a $10,000 investment would lose approximately $258 to fees over 20 years compared to a zero-fee investment. This is a reasonable fee level for the value provided.
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Pros and Cons of SCHZ
Pros
- ✓Comprehensive U.S. bond market exposure in a single low-cost ETF
- ✓Expense ratio of just 0.03% matches the cheapest aggregate bond funds
- ✓Over 6,000 holdings provide exceptional diversification across bond types
- ✓Ideal core bond holding for simple two-fund or three-fund portfolios
Cons
- ✗Intermediate duration means moderate sensitivity to rising interest rates
- ✗Returns have been negative in recent years due to the rate-hiking cycle
- ✗No exposure to high-yield or international bonds limits income potential
Frequently Asked Questions
Is SCHZ a good ETF for beginners?▾
SCHZ has a Beginner Suitability Score of 10/10 on our scale. This makes it a strong choice for new investors due to its low fees and broad diversification.
What is the expense ratio of SCHZ?▾
SCHZ has an expense ratio of 0.03%. This means for every $10,000 you invest, you pay approximately $3 per year in fees. This is considered very low and cost-efficient.
How much money do I need to invest in SCHZ?▾
You can invest in SCHZ with as little as $1 through brokers that offer fractional shares (like Fidelity, Schwab, or Robinhood). There is no minimum investment required beyond the share price itself, which changes daily. Dollar cost averaging — investing a fixed amount regularly — is a popular strategy.
Does SCHZ pay dividends?▾
Yes, SCHZ pays dividends with a current yield of approximately 3.40%. Dividends are typically paid quarterly and can be reinvested automatically through most brokers.
What are the top holdings in SCHZ?▾
The top holdings in SCHZ include U.S. Treasury 4.0% 2033 (2.50%), U.S. Treasury 3.875% 2043 (2.20%), U.S. Treasury 4.25% 2031 (2.00%), and more. The fund holds 6,000 total positions, providing broad diversification across many companies.