Schwab Celebrates Mutual Fund Investing Two Decades After Debut of Groundbreaking Mutual Fund OneSource® Platform

Monday, July 16, 2012 7:00 am PDT

Dateline:

SAN FRANCISCO

Public Company Information:

NYSE:
SCHW
"Highest in Investor Satisfaction With Self-Directed Services"

SAN FRANCISCO--(BUSINESS WIRE)--Charles Schwab, a leader in the financial services industry, is celebrating an industry milestone with the release of Schwab’s Mutual Fund OneSource® at 20, a report that looks back at the evolution of a groundbreaking service that simplifies the way investors buy and sell no-load mutual funds from multiple fund families without paying transaction fees. Unveiled in July 1992 with eight fund families and 80 mutual funds, Schwab’s Mutual Fund OneSource® service (Mutual Fund OneSource) revolutionized mutual fund investing for millions of individual investors and registered investment advisors (RIAs), and today provides access to more than 430 fund families and 4,400 no-load, no-transaction-fee funds.

“There are many facets of mutual fund investing that we take for granted today. We forget that access to funds and fund information wasn’t always so easy,” said Doug Hanson, the Charles Schwab vice president who oversees the company’s third-party mutual fund platforms. “The 20th anniversary of the Mutual Fund OneSource platform seemed like an ideal time to reflect on how far mutual fund investing and investors have come.”

In 1992, only 27 percent of all U.S. households owned any type of mutual fund1, and there was no easy way for investors to gather information about, invest in or track the performance of mutual funds. Schwab had a vision for simplifying the process to give investors one place to access a wide array of no-load mutual funds without a transaction fee And investors responded with enthusiasm, adding assets to Mutual Fund OneSource that grew from $1.6 billion that first year to $214 billion today. According to the Investment Company Institute, 52.3 million households, or 44 percent of U.S. households, own funds today2.

Drawing on more than a dozen interviews with company founder and Chairman Chuck Schwab, Schwab employees, fund companies and other third parties, the new report recalls the hurdles that Mutual Fund OneSource had to overcome while it was striving to simplify mutual fund investing. Schwab’s Mutual Fund OneSource® at 20 looks at:

  • The challenge of communicating the platform concept to mutual fund families.
  • The important part RIAs played in the early success of Mutual Fund OneSource.
  • The critical role of technology in making fund research available to the average investor.
  • The evolution of the Mutual Fund OneSource Select List®, a concise list of carefully pre-screened mutual funds, which was introduced in 1993.

Mark Headley, chairman of Matthews International Capital Management noted, “I think it’s fortunate for the investment world that Schwab was the one who developed the concept. I’m not sure anyone else would have done it the same way.” Artisan Partners managing director Mike Roos agreed, calling the new platform, “…a win for everybody -- not just for Schwab, but for advisors, fund companies, and above all, investors.” And Neil Bathon, founder and partner of the independent research firm FUSE Research Network LLC recognized that “[T]here are any number of mutual fund companies that would not be in business today without Mutual Fund OneSource.”

Hanson added, “At our core, Schwab is about improving access and simplifying investing for investors – this hasn’t changed in the past 20 years, nor do I expect it to change over the next 20.”

To access the full white paper or watch excerpts from an interview with Chuck Schwab about Mutual Fund OneSource, go to http://aboutschwab.com/press/research/.

About Charles Schwab

The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with more than 300 offices and 8.7 million active brokerage accounts, 1.5 million corporate retirement plan participants, 815,000 banking accounts, and $1.76 trillion in client assets, as of May 31, 2012. The company was ranked "Highest in Investor Satisfaction With Self-Directed Services" in the 2012 US Self-Directed Investor Satisfaction StudySM from J.D Power and Associates. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, www.sipc.org), and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and mortgage services and products. More information is available at www.schwab.com and www.aboutschwab.com. (0712-4691)

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© 2012 Charles Schwab & Co., Inc. Member SIPC

Investors should consider carefully information contained in the prospectus, including investment objectives, risks, charges, and expenses. You can request a prospectus at www.schwab.com or by calling 800-435-4000. Please read the prospectus carefully before investing.

Investment value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.

Schwab’s short-term redemption fee of $49.95 will be charged on redemption of funds purchased through Schwab’s Mutual Fund OneSource® service (and certain other funds with no transaction fees) and held for 90 days or less. Schwab reserves the right to exempt certain funds from this fee, including Schwab Funds®, which may charge a separate redemption fee, and funds that accommodate short-term trading. Funds are also subject to management fees and expenses.

Charles Schwab & Co., Inc. (member SIPC) receives remuneration from fund companies in the Mutual Fund OneSource program for recordkeeping and shareholder services, and other administrative services. Schwab also may receive remuneration from transaction fee fund companies for certain administrative services.

Trades in no-load funds available through Mutual Fund OneSource service (including Schwab Funds), as well as certain other funds, are available without transaction fees when placed through schwab.com or our automated phone channels. For each of these trade orders placed through a broker, a $25 service charge applies. Schwab reserves the right to change the funds we make available without transaction fees and to reinstate fees on any funds.

Testimonials may not be representative of the experience of other clients and is not indicative of future performance or success.

Charles Schwab, Schwab, Mutual Fund OneSource, Mutual Fund OneSource Select List, and other trademarks appearing herein, which may be indicated by “®” or “™”, are registered trademarks or trademarks of Charles Schwab & Co., Inc., in the U.S. and/or other countries. These trademarks and registered trademarks are proprietary to Charles Schwab & Co., Inc., in the U.S. and/or other countries.

1 2012 Investment Company Fact Book, 52nd Edition, Investment Company Institute

2 2012 Investment Company Fact Book, 52nd Edition, Investment Company Institute

Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50341244&lang=en

Contact:

Charles Schwab
Alyson Nikulicz, 212-403-9240
alyson.nikulicz@schwab.com

Multimedia Files:

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Schwab's Mutual Fund OneSource(R) at 20

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