Schwab Capital Trust
Schwab Fundamental Global Real Estate Index Fund
Portfolio Holdings as of May 31, 2026 (Unaudited)
SECURITY
NUMBER
OF SHARES
VALUE ($)
COMMON STOCKS 99.2% OF NET ASSETS
 
Australia 2.8%
Charter Hall Group
9,730
142,403
Dexus
35,664
143,585
Goodman Group
14,737
334,891
GPT Group
46,204
160,906
Mirvac Group
193,236
234,543
Region Group
40,951
66,798
Scentre Group
151,299
415,664
Stockland
105,029
308,677
Vicinity Ltd.
139,404
253,057
 
2,060,524
 
Belgium 0.3%
Aedifica SA
906
74,736
Cofinimmo SA
1,010
97,838
Warehouses De Pauw CVA
2,734
70,807
 
243,381
 
Brazil 0.1%
Allos SA
3,300
18,454
Cyrela Brazil Realty SA Empreendimentos e
Participacoes
14,840
66,249
 
84,703
 
Canada 2.3%
Allied Properties Real Estate Investment
Trust
10,857
79,145
Altus Group Ltd.
1,381
42,372
Canadian Apartment Properties REIT
5,886
149,685
Choice Properties Real Estate Investment
Trust
8,561
97,803
Colliers International Group, Inc.
1,077
101,642
Crombie Real Estate Investment Trust
7,105
86,786
Dream Industrial Real Estate Investment
Trust
7,545
76,728
First Capital Real Estate Investment Trust
8,263
140,848
FirstService Corp.
949
127,222
Granite Real Estate Investment Trust
1,830
127,907
H&R Real Estate Investment Trust
21,861
164,277
Killam Apartment Real Estate Investment
Trust
3,824
50,870
RioCan Real Estate Investment Trust
16,874
271,595
SmartCentres Real Estate Investment Trust
4,982
104,724
Vital Infrastructure Property Trust
12,343
48,077
 
1,669,681
 
China 6.5%
A-Living Smart City Services Co. Ltd.,
H Shares
199,250
59,537
C&D International Investment Group Ltd.
30,719
61,854
China Merchants Shekou Industrial Zone
Holdings Co. Ltd., A Shares
71,200
92,848
China Resources Land Ltd.
296,500
1,335,329
China Resources Mixc Lifestyle Services Ltd.
9,400
49,884
SECURITY
NUMBER
OF SHARES
VALUE ($)
China Vanke Co. Ltd., A Shares *
539,900
283,293
China Vanke Co. Ltd., H Shares *
881,500
304,957
Country Garden Services Holdings Co. Ltd.
263,900
195,916
Gemdale Corp., A Shares *
191,200
77,728
Greentown China Holdings Ltd.
144,500
163,549
Greentown Service Group Co. Ltd.
88,000
49,730
Guangzhou R&F Properties Co. Ltd.,
H Shares *(a)
1,267,422
57,412
Hopson Development Holdings Ltd. *(b)
225,100
77,035
KE Holdings, Inc., ADR
29,307
486,496
Logan Group Co. Ltd. *
49,000
8,259
Longfor Group Holdings Ltd.
514,000
514,106
Onewo, Inc., H Shares
6,300
14,111
Poly Developments & Holdings Group Co.
Ltd., A Shares
289,700
247,120
Red Star Macalline Group Corp. Ltd.,
H Shares *
217,200
34,662
Seazen Group Ltd. *
836,000
194,067
Seazen Holdings Co. Ltd., A Shares *
28,300
54,883
Shenzhen Overseas Chinese Town Co. Ltd.,
A Shares *
229,900
65,916
Shui On Land Ltd. *
899,000
55,120
Sunac China Holdings Ltd. *
1,679,000
203,645
Zhuhai Huafa Properties Co. Ltd., A Shares
96,200
41,665
 
4,729,122
 
France 2.1%
Carmila SA
3,557
68,911
Covivio SA
2,346
150,680
Gecina SA
1,688
144,291
ICADE *(a)
4,967
121,695
Klepierre SA
7,080
288,819
Mercialys SA
3,885
53,657
Nexity SA *
14,444
137,567
Unibail-Rodamco-Westfield *
4,823
557,535
 
1,523,155
 
Germany 1.1%
LEG Immobilien SE
2,427
157,573
TAG Immobilien AG
6,208
102,730
Vonovia SE
21,546
537,005
 
797,308
 
Guernsey 0.0%
Sirius Real Estate Ltd.
10,748
14,228
 
Hong Kong 10.3%
China Jinmao Holdings Group Ltd.
869,000
193,006
China Overseas Grand Oceans Group Ltd.
526,000
194,643
China Overseas Land & Investment Ltd.
674,000
1,340,639
CK Asset Holdings Ltd.
143,450
866,098
Fortune Real Estate Investment Trust
72,000
44,387
Hang Lung Group Ltd.
68,000
126,436
Hang Lung Properties Ltd.
86,697
88,983
Henderson Land Development Co. Ltd.
57,866
228,460
Hongkong Land Holdings Ltd.
40,727
310,459
Hysan Development Co. Ltd.
34,500
82,112
  
1

Schwab Fundamental Global Real Estate Index Fund
Portfolio Holdings (Unaudited) continued
SECURITY
NUMBER
OF SHARES
VALUE ($)
Jiayuan International Group Ltd. *(b)
534,000
0
Kerry Properties Ltd.
54,500
144,076
Link REIT
87,100
448,984
New World Development Co. Ltd. *
548,460
575,761
Poly Property Group Co. Ltd.
683,000
181,481
Shanghai Industrial Holdings Ltd.
70,000
134,861
Shenzhen Investment Ltd. *
606,000
61,088
Shinsun Holdings Group Co. Ltd. *(b)
1,290,000
0
Sino Land Co. Ltd.
111,797
168,472
Sun Hung Kai Properties Ltd.
65,842
1,105,798
Swire Pacific Ltd., A Shares
38,500
400,646
Swire Pacific Ltd., B Shares
77,500
128,845
Swire Properties Ltd.
36,600
103,920
Wharf Holdings Ltd.
37,000
104,680
Wharf Real Estate Investment Co. Ltd.
88,400
270,924
Yuexiu Property Co. Ltd.
288,359
160,755
 
7,465,514
 
Israel 0.4%
Alony Hetz Properties & Investments Ltd.
6,426
81,388
Azrieli Group Ltd.
447
73,858
Elco Ltd.
779
40,877
Mivne Real Estate KD Ltd.
11,826
60,125
 
256,248
 
Japan 9.7%
Activia Properties, Inc.
73
59,951
Advance Residence Investment Corp.
72
69,620
AEON REIT Investment Corp.
81
62,428
Daito Trust Construction Co. Ltd.
33,750
670,409
Daiwa House REIT Investment Corp.
143
108,224
Daiwa Office Investment Corp.
20
39,927
Daiwa Securities Living Investments Corp.
69
43,923
Frontier Real Estate Investment Corp.
86
44,056
GLP J-Reit
114
95,672
Hulic Co. Ltd.
24,700
263,494
Industrial & Infrastructure Fund Investment
Corp.
75
66,028
Invincible Investment Corp.
131
50,392
Japan Excellent, Inc.
50
44,102
Japan Hotel REIT Investment Corp.
80
38,471
Japan Logistics Fund, Inc.
77
44,430
Japan Metropolitan Fund Invest
228
161,013
Japan Prime Realty Investment Corp.
116
69,247
Japan Real Estate Investment Corp.
203
145,625
Japan Wool Textile Co. Ltd.
4,700
51,764
KDX Realty Investment Corp.
69
68,827
Leopalace21 Corp.
17,600
68,809
Mitsubishi Estate Co. Ltd.
48,900
1,235,592
Mitsui Fudosan Accommodations Fund, Inc.
67
52,948
Mitsui Fudosan Co. Ltd.
118,700
1,136,239
Nippon Building Fund, Inc.
219
175,170
Nippon Prologis REIT, Inc.
174
93,151
Nomura Real Estate Holdings, Inc.
38,300
218,570
Nomura Real Estate Master Fund, Inc.
154
147,516
NTT UD REIT Investment Corp.
53
44,016
Orix JREIT, Inc.
172
103,767
Relo Group, Inc.
5,100
58,969
Sekisui House Reit, Inc.
125
64,348
Starts Corp., Inc.
2,600
74,057
Sumitomo Realty & Development Co. Ltd.
24,800
578,418
Token Corp.
900
72,276
Tokyo Tatemono Co. Ltd.
11,300
231,738
Tokyu Fudosan Holdings Corp.
47,500
392,809
United Urban Investment Corp.
99
100,803
 
7,046,799
 
SECURITY
NUMBER
OF SHARES
VALUE ($)
Jersey 0.3%
International Workplace Group PLC
92,314
234,995
 
Luxembourg 0.2%
Aroundtown SA *
43,007
127,195
 
Mexico 0.7%
Corp. Inmobiliaria Vesta SAB de CV
15,240
53,534
FIBRA Macquarie Mexico
33,724
84,811
Fibra Uno Administracion SA de CV
178,322
308,569
Prologis Property Mexico SA de CV
13,080
62,891
 
509,805
 
Netherlands 0.4%
CTP NV
2,973
56,316
Eurocommercial Properties NV
1,893
64,363
NEPI Rockcastle NV *
22,134
193,534
 
314,213
 
Philippines 0.5%
Ayala Corp.
16,160
114,541
Ayala Land, Inc.
364,432
86,201
Megaworld Corp.
1,171,000
39,542
Robinsons Land Corp.
158,400
41,927
SM Prime Holdings, Inc.
288,600
86,209
 
368,420
 
Singapore 1.6%
CapitaLand Ascendas REIT
99,574
195,142
CapitaLand Ascott Trust
97,680
68,528
CapitaLand Integrated Commercial Trust
112,975
201,090
City Developments Ltd.
25,200
169,373
Frasers Logistics & Commercial Trust *
123,200
96,539
Mapletree Industrial Trust
57,644
87,620
Mapletree Logistics Trust
97,431
91,688
Mapletree Pan Asia Commercial Trust
73,627
73,842
UOL Group Ltd.
24,880
197,902
Yanlord Land Group Ltd.
8,900
4,884
 
1,186,608
 
South Africa 0.6%
Growthpoint Properties Ltd.
215,166
221,734
Hyprop Investments Ltd.
15,982
55,987
Redefine Properties Ltd.
361,107
133,620
 
411,341
 
Spain 0.3%
Colonial SFL Socimi SA
11,317
75,557
Merlin Properties Socimi SA
8,041
141,262
 
216,819
 
Sweden 0.6%
Castellum AB
13,277
180,250
Fabege AB
6,329
54,601
Fastighets AB Balder, B Shares *
11,354
65,035
Norion Bank AB *
925
5,811
Sagax AB, B Shares
2,389
43,068
2
  

Schwab Fundamental Global Real Estate Index Fund
Portfolio Holdings (Unaudited) continued
SECURITY
NUMBER
OF SHARES
VALUE ($)
Samhallsbyggnadsbolaget i Norden AB *
155,606
57,688
Wihlborgs Fastigheter AB
6,486
59,785
 
466,238
 
Switzerland 0.7%
Allreal Holding AG
410
109,868
Mobimo Holding AG
125
56,851
PSP Swiss Property AG
623
118,668
Swiss Prime Site AG
1,393
233,505
 
518,892
 
Taiwan 0.2%
Huaku Development Co. Ltd.
17,640
67,293
Ruentex Development Co. Ltd.
53,273
39,565
 
106,858
 
Thailand 0.6%
3BB Internet Infrastructure Fund, Class F
248,400
49,131
Central Pattana PCL NVDR
82,500
163,092
Land & Houses PCL NVDR
832,211
91,963
Sansiri PCL NVDR
1,393,383
61,306
Supalai PCL NVDR
152,482
72,622
 
438,114
 
United Arab Emirates 0.9%
Aldar Properties PJSC
38,446
82,130
Emaar Development PJSC
26,329
104,351
Emaar Properties PJSC
151,408
490,009
 
676,490
 
United Kingdom 1.8%
Big Yellow Group PLC
4,739
53,513
British Land Co. PLC
30,213
164,680
Derwent London PLC
3,887
92,888
Grainger PLC
22,804
48,553
Land Securities Group PLC
29,943
252,796
LondonMetric Property PLC
18,827
47,887
Primary Health Properties PLC
54,130
68,349
Safestore Holdings PLC
7,228
62,700
Savills PLC
11,483
128,662
Segro PLC
23,600
228,774
Tritax Big Box REIT PLC
34,039
68,762
UNITE Group PLC
8,352
57,819
 
1,275,383
 
United States 54.2%
Acadia Realty Trust
2,876
63,329
Agree Realty Corp.
1,419
105,219
Alexandria Real Estate Equities, Inc.
11,024
547,672
American Assets Trust, Inc.
3,332
77,636
American Healthcare REIT, Inc.
1,938
94,749
American Homes 4 Rent, Class A
7,688
246,631
American Tower Corp.
10,196
1,906,244
Americold Realty Trust, Inc.
21,666
339,940
Apple Hospitality REIT, Inc.
14,001
205,675
AvalonBay Communities, Inc.
3,758
685,873
Brandywine Realty Trust
36,374
112,759
Brixmor Property Group, Inc.
10,646
325,342
Broadstone Net Lease, Inc.
6,188
125,183
BXP, Inc.
9,706
582,457
Camden Property Trust
3,308
352,500
CareTrust REIT, Inc.
1,619
66,088
CBRE Group, Inc., Class A *
11,628
1,453,965
SECURITY
NUMBER
OF SHARES
VALUE ($)
Centerspace
814
54,929
Claros Mortgage Trust, Inc. *
25,703
62,458
Compass, Inc., Class A *
70,551
580,635
COPT Defense Properties
4,994
160,108
CoStar Group, Inc. *
4,052
130,474
Cousins Properties, Inc.
8,101
217,188
Crown Castle, Inc.
15,973
1,461,529
CubeSmart
6,023
240,920
Cushman & Wakefield Ltd. *
23,362
290,623
DiamondRock Hospitality Co.
9,531
104,746
Digital Realty Trust, Inc.
7,326
1,391,940
Diversified Healthcare Trust
30,682
255,274
Douglas Emmett, Inc.
15,036
175,019
Easterly Government Properties, Inc.
3,061
73,403
EastGroup Properties, Inc.
763
154,057
Empire State Realty Trust, Inc., Class A
15,259
87,434
EPR Properties
2,962
168,982
Equinix, Inc.
1,324
1,414,085
Equity LifeStyle Properties, Inc.
3,619
223,546
Equity Residential
13,425
878,666
Essential Properties Realty Trust, Inc.
2,526
77,245
Essex Property Trust, Inc.
1,747
476,302
eXp World Holdings, Inc.
17,689
87,030
Extra Space Storage, Inc.
3,583
517,063
Federal Realty Investment Trust
2,855
341,544
First Industrial Realty Trust, Inc.
2,980
184,373
Four Corners Property Trust, Inc.
2,136
53,186
Gaming & Leisure Properties, Inc.
7,142
335,460
Global Net Lease, Inc.
10,677
100,043
Healthcare Realty Trust, Inc.
16,330
325,294
Healthpeak Properties, Inc.
30,356
581,317
Highwoods Properties, Inc.
7,792
203,371
Host Hotels & Resorts, Inc.
33,637
772,978
Hudson Pacific Properties, Inc. *
12,537
150,193
Independence Realty Trust, Inc.
5,848
94,913
Innovative Industrial Properties, Inc.
1,324
76,779
InvenTrust Properties Corp.
2,394
79,313
Invitation Homes, Inc.
15,930
465,952
Iron Mountain, Inc.
6,757
866,585
JBG SMITH Properties
8,703
127,673
Jones Lang LaSalle, Inc. *
3,197
902,545
Kennedy-Wilson Holdings, Inc.
9,874
108,713
Kilroy Realty Corp.
7,409
253,906
Kimco Realty Corp.
18,689
450,031
Kite Realty Group Trust
6,216
170,443
Lamar Advertising Co., Class A
2,627
400,512
Lineage, Inc.
2,741
121,728
LTC Properties, Inc.
1,513
56,601
LXP Industrial Trust
2,919
150,737
Macerich Co.
10,582
238,307
Marcus & Millichap, Inc.
2,307
65,150
McGrath RentCorp
939
102,342
Medical Properties Trust, Inc.
59,327
303,161
Mid-America Apartment Communities, Inc.
3,687
475,881
National Health Investors, Inc.
1,120
82,085
National Storage Affiliates Trust
2,300
98,095
Newmark Group, Inc., Class A
6,170
86,195
NNN REIT, Inc.
5,006
222,817
Omega Healthcare Investors, Inc.
5,971
279,204
Outfront Media, Inc.
7,596
244,895
Park Hotels & Resorts, Inc.
22,822
276,831
Pebblebrook Hotel Trust
10,800
164,700
Phillips Edison & Co., Inc.
3,258
130,809
Piedmont Realty Trust, Inc., Class A *
17,206
142,982
Prologis, Inc.
15,567
2,233,397
Public Storage
2,915
885,256
Realty Income Corp.
13,131
804,668
Regency Centers Corp.
4,637
358,672
Rexford Industrial Realty, Inc.
4,324
153,372
  
3

Schwab Fundamental Global Real Estate Index Fund
Portfolio Holdings (Unaudited) continued
SECURITY
NUMBER
OF SHARES
VALUE ($)
RLJ Lodging Trust
17,747
172,678
Ryman Hospitality Properties, Inc.
1,351
155,541
Sabra Health Care REIT, Inc.
8,747
173,978
SBA Communications Corp.
2,442
496,117
Service Properties Trust
66,251
118,589
Sila Realty Trust, Inc.
2,065
62,446
Simon Property Group, Inc.
6,738
1,380,684
SITE Centers Corp.
2,398
12,110
SL Green Realty Corp.
4,810
218,374
STAG Industrial, Inc.
4,914
186,093
Summit Hotel Properties, Inc.
10,512
60,654
Sun Communities, Inc.
3,627
448,515
Sunstone Hotel Investors, Inc.
13,733
148,591
Tanger, Inc.
2,826
101,934
Terreno Realty Corp.
1,415
92,951
UDR, Inc.
10,449
385,568
Uniti Group, Inc.
11,865
133,125
Urban Edge Properties
5,194
116,553
Ventas, Inc.
11,131
939,679
VICI Properties, Inc.
19,457
549,077
Vornado Realty Trust
8,106
273,577
Welltower, Inc.
6,890
1,414,724
WP Carey, Inc.
5,973
444,511
Xenia Hotels & Resorts, Inc.
6,334
110,022
 
39,494,018
Total Common Stocks
(Cost $51,647,677)
72,236,052
PREFERRED STOCKS 0.0% OF NET ASSETS
 
Brazil 0.0%
Cyrela Brazil Realty SA Empreendimentos e
Participacoes *
1,380
5,605
Total Preferred Stocks
(Cost $2,260)
5,605
INVESTMENT COMPANIES 0.1% OF NET ASSETS
 
United States 0.1%
iShares Core U.S. REIT ETF
1,428
92,506
Total Investment Companies
(Cost $92,927)
92,506
SECURITY
NUMBER
OF SHARES
VALUE ($)
SHORT-TERM INVESTMENTS 0.2% OF NET ASSETS
 
Money Market Funds 0.2%
State Street Institutional U.S. Government
Money Market Fund, Premier Class
3.56% (c)(d)
175,000
175,000
Total Short-Term Investments
(Cost $175,000)
175,000
Total Investments in Securities
(Cost $51,917,864)
72,509,163
 
NUMBER OF
CONTRACTS
NOTIONAL
AMOUNT
($)
CURRENT VALUE/
UNREALIZED
DEPRECIATION
($)
FUTURES CONTRACTS
Long
Dow Jones U.S. Real Estate
Index, expires 06/18/26
8
307,120
(737
)
MSCI EAFE Index, expires
06/19/26
1
155,565
(10
)
MSCI Emerging Markets Index,
expires 06/19/26
1
87,425
(229
)
 
(976
)
*
Non-income producing security.
(a)
All or a portion of this security is on loan.
(b)
Fair valued using significant unobservable inputs.
(c)
The rate shown is the annualized 7-day yield.
(d)
Security purchased with cash collateral received for securities on loan.
Securities on loan were valued at $164,810.
ADR —
American Depositary Receipt
CVA —
Dutch Certificate
ETF —
Exchange-Traded Fund
NVDR —
Non-Voting Depositary Receipt
REIT —
Real Estate Investment Trust
Below is a summary of the fund’s transactions with affiliated issuers and companies which are or were affiliates during the period ended May 31, 2026. An affiliated company is a company in which the investment adviser has or had an ownership of at least 5% of the voting securities of a security issue during the report period. A dash in the Value at February 28, 2026, and/or Value and Balance of Shares Held at May 31, 2026, columns means either the issuer was not held or not held as an affiliate on the stated date.
SECURITY
VALUE AT
2/28/26
PURCHASES
SALES
NET REALIZED
GAINS (LOSSES)
NET CHANGE
IN UNREALIZED
APPRECIATION
(DEPRECIATION)
VALUE AT
5/31/26
BALANCE
OF SHARES
HELD AT
5/31/26
DIVIDENDS
RECEIVED
COMMON STOCKS 0.0% OF NET ASSETS
 
United States 0.0%
Service Properties Trust
$168,098
$
($12,202
)
($35,941
)
($1,366
)
$
$681

4
  

Schwab Fundamental Global Real Estate Index Fund
Portfolio Holdings (Unaudited) continued
The following is a summary of the inputs used to value the fund’s investments as of May 31, 2026:
DESCRIPTION
QUOTED PRICES IN
ACTIVE MARKETS FOR
IDENTICAL ASSETS
(LEVEL 1)
OTHER SIGNIFICANT
OBSERVABLE INPUTS
(LEVEL 2)
SIGNIFICANT
UNOBSERVABLE INPUTS
(LEVEL 3)
TOTAL
Assets
Common Stocks 1
$42,086,648
$
$
$42,086,648
Australia
2,060,524
2,060,524
Belgium
243,381
243,381
China
824,194
3,827,893
77,035
4,729,122
France
1,523,155
1,523,155
Germany
797,308
797,308
Hong Kong
255,731
7,209,783
0
*
7,465,514
Israel
256,248
256,248
Japan
464,359
6,582,440
7,046,799
Jersey
234,995
234,995
Luxembourg
127,195
127,195
Philippines
240,292
128,128
368,420
Singapore
1,186,608
1,186,608
South Africa
355,354
55,987
411,341
Spain
216,819
216,819
Sweden
63,499
402,739
466,238
Switzerland
56,851
462,041
518,892
Taiwan
67,293
39,565
106,858
Thailand
72,622
365,492
438,114
United Arab Emirates
676,490
676,490
United Kingdom
230,728
1,044,655
1,275,383
Preferred Stocks 1
5,605
5,605
Investment Companies 1
92,506
92,506
Short-Term Investments 1
175,000
175,000
Liabilities
Futures Contracts 2
(976
)
(976
)
Total
$44,989,706
$27,441,446
$77,035
$72,508,187
*
Level 3 amount shown includes securities determined to have no value.
1
As categorized in the Portfolio Holdings.
2
Futures contracts are reported at cumulative unrealized appreciation or depreciation.
  
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Schwab Fundamental Global Real Estate Index Fund
Notes to Portfolio Holdings (Unaudited)
Pursuant to Rule 2a-5 under the Investment Company Act of 1940, as amended (the 1940 Act), the Board of Trustees has designated authority to a Valuation Designee, the fund’s investment adviser, to make fair valuation determinations under adopted procedures, subject to Board of Trustees oversight. The investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and liabilities as well as to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair value. The Valuation Designee may utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.
Securities held in the fund’s portfolio are valued every business day. The following valuation policies and procedures are used by the Valuation Designee to value various types of securities:
● Securities traded on an exchange or over-the-counter: Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at the mean of the most recent bid and ask quotes. Securities that are primarily traded on foreign exchanges are valued at the official closing price or the last sales price on the exchange where the securities are principally traded with these values then translated into U.S. dollars at the current exchange rate, unless these securities are fair valued as discussed below.
● Foreign equity security fair valuation: The Valuation Designee has adopted procedures to fair value foreign equity securities that are traded in markets that close prior to the valuation of the fund’s holdings. By fair valuing securities whose prices may have been affected by events occurring after the close of trading, the Valuation Designee seeks to establish prices that investors might expect to realize upon the current sales of these securities. This methodology is designed to deter “arbitrage” market timers, who seek to exploit delays between the change in the value of the fund’s portfolio holdings and the net asset value of the fund’s shares and seeks to help ensure that the prices at which the fund’s shares are purchased and redeemed are fair and do not result in dilution of shareholder interest or other harm to shareholders. When fair value pricing is used at the open or close of a reporting period, it may cause a temporary divergence between the return of the fund and that of its comparative index or benchmark.
● Futures contracts: Futures contracts are valued at their settlement prices as of the close of their exchanges.
● Mutual funds: Mutual funds are valued at their respective net asset values.
● Securities for which no quoted value is available: The Valuation Designee has adopted procedures to fair value the fund’s securities when market prices are not “readily available” or are unreliable. For example, a security may be fair valued when it’s de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Fair value determinations are made in good faith in accordance with adopted valuation procedures. The Valuation Designee considers a number of factors, including unobservable market inputs, when arriving at fair value. The Valuation Designee may employ methods such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. Due to the subjective and variable nature of fair value pricing, there can be no assurance that the fund could obtain the fair value assigned to the security upon the sale of such security.
In accordance with the authoritative guidance on fair value measurements and disclosures under generally accepted accounting principles in the United States of America (GAAP), the fund discloses the fair value of its investments in a hierarchy that prioritizes the significant inputs to valuation methods used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If it is determined that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and the Valuation Designee’s judgment will be required to estimate fair value.
The three levels of the fair value hierarchy are as follows:
● Level 1 — quoted prices in active markets for identical investments — Investments whose values are based on quoted market prices in active markets. These generally include active listed equities, mutual funds, exchange-traded funds and futures contracts. Mutual funds and exchange-traded funds are classified as Level 1 prices, without consideration to the classification level of the underlying securities held which could be Level 1, Level 2, or Level 3 in the fair value hierarchy.
● Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include forward foreign currency exchange contracts, U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. In addition, international securities whose markets close
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Schwab Fundamental Global Real Estate Index Fund
Notes to Portfolio Holdings (Unaudited) (continued)
hours before the valuation of the fund’s holdings may require fair valuations due to significant movement in the U.S. markets occurring after the daily close of foreign markets. The Valuation Designee has approved a vendor that calculates fair valuations of international equity securities based on a number of factors that appear to correlate to the movements in the U.S. markets.
● Level 3 — significant unobservable inputs (including the Valuation Designee’s assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not readily available for these securities, one or more valuation methods are used for which sufficient and reliable data is available. The inputs used in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated in the absence of market information. Assumptions used due to the lack of observable inputs may significantly impact the resulting fair value and therefore the fund’s results of operations.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The levels associated with valuing the fund’s investments are disclosed in the fund’s Portfolio Holdings.
REG84516MAY26
  
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