SCHI - SCHI: Corporate Bonds Could Still Avoid Credit Risk (But Not For Long)
2024-05-28 08:14:28 ET
Summary
- Schwab 5-10 Year Corporate Bond ETF (SCHI) is a passively managed fund that tracks the Bloomberg US 5-10 Year Corporate Bond Index.
- SCHI has a low expense ratio of 0.03% and its ETF wrapper provides a tax advantage for taxable-account holders.
- The fund offers high diversification and exposure to industrials and financials sectors, but carries more credit risk than government bonds.
I continue to believe that corporate credit risk is mispriced. Then again, I’ve believed that for over 6 months. So maybe I’ll be wrong further. And if I am, then there’s an argument to invest in funds like the Schwab 5-10 Year Corporate Bond ETF ( SCHI ), which represents an investment in the intermediate-term corporate bond market. SCHI is a fund that is passively managed. It is designed to track the Bloomberg US 5-10 Year Corporate Bond Index. This index tracks the corporate bond market within the US, and it specifically covers corporate debt securities with remaining maturities of between 5 and 10 years. SCHI’s underlying index follows a rules-based strategy that is designed to provide investors with an economic representation and a transparent exposure to the corporate bond market within this maturity range....
SCHI: Corporate Bonds Could Still Avoid Credit Risk (But Not For Long)