(PUB) Morningstar FundInvestor

23

Morningstar FundInvestor

June 2 013

Data through May 31, 2013 Schwab Fdmtl US Lg Co Idx

Ticker

Status Yield Total Assets

Mstar Category

SFLNX Open

1.9% $2,614 mil

Large Value

Morningstar Analyst Rating 02-25-13

Investment Style Equity Stock %

Historical Profile Return Risk Rating High Above Avg Above Avg

100% 100% 99% 99% 99% 99% 98%

´

Manager Change Partial Manager Change

10.0 12.0

Morningstar Pillars Process Performance

Growth of $10,000

Positive Positive Neutral Negative Neutral

Investment Values of Fund Investment Values of S&P 500

6.0

People Parent Price

¶ § ¶

4.0

Performance Quartile (within Category) History

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 05-13

Morningstar Analyst Rating Morningstar evaluates mutual funds based on five key pillars, which its analysts believe lead to funds that are more likely to outperform over the long term on a risk-adjusted basis. Analyst Rating Spectrum Œ „ ´ˇ ¨

9.44 5.82 10.05 . . . . . . 42.14 -40.07 . . . . . . 15.68 -3.07 . . . . . . 22.45 -3.22 . . . . . . 1.56 2.01 . . . . . . 40.58 -42.08 . . . . . . 5 74 . . . . . . 0.20 0.09 . . . . . . 0.00 0.01 . . . . . . 9.64 -0.21 -2.32 -0.60 1.82 -2.03 8.18 16.30 19.71 0.30 -1.21 2.51 13.79 4.65 4.20 1.81 17.90 31 44 4

12.62 17.50

NAV

Total Return %

2.13 0.57 0.00

+/-S&P 500

+/-Russ 1000 Vl Income Return % Capital Return %

17.50

23

Total Rtn % Rank Cat

Pillar Spectrum Positive

0.09 0.00 0.35 1.77

0.15 0.00 0.35 2.06

0.18 0.00 0.32 2.13

0.00 0.00

Income $

§ Negative

¶ Neutral

Capital Gains $ Expense Ratio % Income Ratio % Turnover Rate % Net Assets $mil

0.35 0.35 0.35 . . . . . 2.19 1.66 . . . . . 26 2 . . . . . 264 361 . . . . . 1.88 27 28 1,133 728

. . .

Performance 05-31-13 1st Qtr 2nd Qtr

3rd Qtr

4th Qtr

Total

11

32

2009 2010 2011 2012 2013

-13.57 27.44 26.21 2.26 42.14 8.80 -11.35 11.03 11.79 19.71 6.12 -0.49 -15.82 12.24 -0.21 11.33 -3.33 6.30 1.65 16.30 12.76 . . . .

1,560

1,965

2,614

Portfolio Analysis 01-31-13 Share change since 10-12 Total Stocks:614 Sector

Rating and Risk Time Load-Adj

PE Tot Ret% % Assets

Morningstar

Morningstar Risk vs Cat

Morningstar Risk-Adj Rating

Period Return % Rtn vs Cat

Exxon Mobil Corporation

Energy Energy

9.2 5.92 4.90 9.2 15.27 2.48

1 Yr 3 Yr 5 Yr

32.72 16.75

Trailing

Total

+/-

+/- Russ %Rank Growth of

Chevron Corp

Return% S&P 500 1000 Vl

Cat

$10,000

+Avg High

Avg

S+p 500 E Mini Index Fut

1.94

. . . Comm Svs 27.1 6.47 1.90

3 Mo 6 Mo 1 Yr

8.79 0.57 19.45 3.02 32.72 5.44 16.75 -0.12 8.07 2.64

0.55 0.10 0.01 0.16 3.34

42 10,879 26 11,945 23 13,272 19 15,914

8.07

+Avg

AT&T Inc

10 Yr Incept

. . . .

Ssc Goverment Mm Gvxx Bank of America Corporat Procter & Gamble Co General Electric Co Microsoft Corporation Wal-Mart Stores Inc JPMorgan Chase & Co Johnson & Johnson Verizon Communications I ConocoPhillips Pfizer Inc

1.86

. . .

5.70

Finan Svs 42.2 17.74 1.82 Cnsmr Def 19.3 14.78 1.61

3 Yr Avg 5 Yr Avg 10 Yr Avg 15 Yr Avg

Other Measures

Standard Index

Best Fit Index Russ 1000 Vl

2 14,741 . . . . . . . . . . Tax Analysis Tax-Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat

Industrl Energy

16.3 12.01 1.59 10.5 8.05 1.59

S&P 500

Alpha

-0.8 1.05

0.0

Technology 18.1 32.39 1.43 Cnsmr Cyc 14.9 11.07 1.38 Hlth care 19.2 10.49 1.33

Beta

1.01

R-Squared

98

99

3 Yr (estimated) 5 Yr (estimated) 10 Yr (estimated)

16.13

15

0.53 0.63

56

Standard Deviation

14.85 16.75

Finan Svs

9.8 25.52 1.32

7.38 60 . . . . 1

Hlth care 22.8 21.90 1.29

Mean

Comm Svs 122.0 14.42 1.28 International Business M Technology 14.4 9.54 1.24 Citigroup Inc Finan Svs 18.2 31.47 1.23 Hewlett-Packard Co Technology . 72.29 0.91 Time Warner Inc Cnsmr Cyc 17.9 23.24 0.89 Valero Energy Corporatio Energy 7.1 31.59 0.86

Sharpe Ratio

1.12

Potential Capital Gain Exposure: 21% of assets Morningstar’s Take by Alex Bryan 02-25-13 Schwab Fundamental U.S. Large Company Index SFLNX offers active returns with passive discipline. Unlike most index funds, this fund weights its holdings based on fundamental measures of size, including retained operating cash flow (reinvested profits), sales, and capital distributions (dividends and buybacks), rather than market capitalization. Proponents of fundamental indexing argue that these metrics better reflect each firm’s intrinsic value than market capitalization. According to this line of reasoning, market-cap weighting tends to overweight expensive stocks and underweight cheaper names. Efficient-market advocates and other critics dismiss fundamental indexing as a repackaged value strategy. Most fundamental indexes exhibit a value tilt. But a 50-country study by Christian Walkshausl and Sebastian Lobe covering 1982-2008 found fundamental indexing added significant excess returns globally, even after controlling for value and other risk exposures. Fundamental indexes’ contrarian bent may

contribute to this superior performance. The fund pares back exposure to stocks whose valuations expand relative to peers and increases exposure to those whose valuations compress. These bets against the market have made the fund slightly more volatile than the Russell 1000 Index over the past five years. This is a suitable core holding for long-term investors who can stomach a little extra volatility to capitalize on potential market mispricing. This strategy can add value by reducing exposure to expensive growth stocks. Over the long-run, betting on value has paid off handsomely in nearly every market. Research suggests that investors tend to extrapolate recent growth too far into the future, which can cause prices to diverge from fundamental value. This fund counters this bias by anchoring its weights in each company’s proven capacity to create value. Given its small-cap and value tilts, it will likely underperform during market downturns and outperform during bull markets. It can offer some protection against growth-oriented market bubbles.

Current Investment Style

Sector Weightings

% of Stocks

Rel S&P 500 High

3 Year Low

Market Cap % Giant 45.2 Large 35.3 Mid 17.3 Small 1.9 Micro 0.3 Avg $mil: 43,442

Value Blnd Growth

Large Mid Small

Cyclical 29.98 1.04 BasicMat 3.34 1.09 4 3 CnsmrCyc11.77 1.37 12 9 FinanSvs 14.14 0.90 20 14 Real Est 0.73 0.50 2 1 Sensitive 44.22 1.01 CommSrvs 5.53 1.38 7 6 Energy 15.77 1.48 16 11 Industrl 11.64 1.02 13 12 Technlgy 11.28 0.64 11 9 Defensive25.79 0.93 CnsmrDef10.81 0.89 12 10 Hlthcare 10.81 0.91 11 9 Utilities 4.17 1.16 6 4

h r t y u j i o p a k s d f

Value Measures Price/Earnings Price/Book Price/Sales Price/Cash Flow Dividend Yield % Long-Term Erngs Book Value Sales Cash Flow Historical Erngs Growth Measures

Rel Category

12.72 1.71 0.75 6.63 2.33

0.98 1.01 0.65 1.10 0.84 1.13 0.68 2.54 0.34 0.88

% Rel Category

9.83 3.56 4.35 1.83 3.41

Composition - Net

Cash 0.1 Stocks 98.0 Bonds 1.9 Other 0.0 Foreign 2.9

Address:

Schwab Capital Trust San Francisco, CA 94104 800-435-4000 www.schwab.com

Minimum Purchase: Min Auto Inv Plan:

$100

Add: $0 IRA: $0

$0

Add: .

Profitability

% Rel Category

Sales Fees:

No-load, 2.00%R 0.30% mx./0.18% mn. Mgt:0.24% Dist: .

Return on Equity Return on Assets Net Margin

17.06 6.46 9.68

1.03 1.06 0.81

Web Address: Inception: Advisor: Subadvisor: NTF Plans:

Management Fee:

(% of Stock)

04-02-07

Actual Fees:

Charles Schwab Investment Management Inc

Expense Projections: Income Distribution:

3Yr:$113 Annually

5Yr:$197 10Yr:$443

None

Schwab OneSource

Mutual Funds ß ®

© 2013Morningstar, Inc.All rights reserved. The information herein isnot represented orwarranted to be accurate, correct, complete or timely. Pastperformance isnoguarantee of future results.Access updated reports at To order reprints, call 312-696-6100. mfb.morningstar.com.

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