ETF Evaluator:
Schwab® Mortgage-Backed Securities ETF ()
Follow This ETF
(as of Aug 26)
Best Performing in Government Mortgage-Backed Bond Over the Last Year
| 5.3% | Regan Floating Rate MBS ETF (MBSF) |
| 4.6% | PIMCO Mortgage-Backed Securities Act ETF (PMBS) |
| 4.5% | iShares Mortgage-Backed Secs Act ETF (MBBA) |
| 4.4% | Janus Henderson Mortgage-Backed Sec ETF (JMBS) |
| 4.3% | Vanguard Mortgage-Backed Secs ETF (VMBS) |
Risk
Index
Risk
Index
ETF Details
Schwab® Mortgage-Backed Securities ETF Overview
Schwab® Mortgage-Backed Securities ETF (SMBS) is a passively managed Taxable Bond Government Mortgage-Backed Bond exchange-traded fund (ETF). Schwab ETFs launched the ETF in 2024.
The investment seeks to track as closely as possible, before fees and expenses, the total return of the Bloomberg U.S. MBS Float Adjusted Total Return Index.
The index is composed of investment-grade mortgage-backed securities issued and/or guaranteed by U.S. government agencies. It is the fund’s policy that under normal circumstances it will invest at least 90% of its net assets (including, for this purpose, any borrowings for investment purposes) in securities included in the index, including TBA transactions.
About Schwab® Mortgage-Backed Securities ETF (SMBS)
There are 2 members of the management team with an average tenure of 1.70 years: Alfonso Portillo (2024) and Matthew Hastings (2024). Management tenure is more important for actively managed ETFs than passive index ETFs.
The ETF has 1 primary benchmark: Bloomberg US MBS Float Adjusted TR USD index with a weighting of 100%. Schwab® Mortgage-Backed Securities ETF has 4277 securities in its portfolio. The top 10 holdings constitute 2.8% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a diversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.
Schwab® Mortgage-Backed Securities ETF is part of the Fixed Income global asset class and is within the Taxable Bond ETF group. Schwab® Mortgage-Backed Securities ETF has 0.0% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 0.0% There is 0.0% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 98.5% (98.5% domestic bond, 0.0% foreign bond and 0.0% convertible bond). Schwab® Mortgage-Backed Securities ETF has 1.5% of the portfolio in cash.
Assets Under Management
The fund has $6 billion in total assets, which is above the $5 billion average for the Government Mortgage-Backed Bond category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.
SMBS Performance and Fees
The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Schwab® Mortgage-Backed Securities ETF expense ratio is low compared to funds in the Government Mortgage-Backed Bond category. Schwab® Mortgage-Backed Securities ETF has an expense ratio of 0.03%, which is 88% lower than its category average, making the fund expense ratio grade a A. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.
High portfolio turnover can translate to higher expenses and lower aftertax returns. Schwab® Mortgage-Backed Securities ETF has a portfolio turnover rate of 20%, which indicates that it holds its assets around / 0.1 years. By way of comparison, the average portfolio turnover is 210% for the Government Mortgage-Backed Bond category.
Recently, in the month of July 2026, Schwab® Mortgage-Backed Securities ETF returned -1.3%, which earned it a grade of B, as the Government Mortgage-Backed Bond category had an average return of -1.3%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.
Schwab® Mortgage-Backed Securities ETF has a trailing yield of 5.24%, which is above the 4.68% category average.
The fund normally distributes its income monthly and its capital gains annually.
It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.
Schwab® Mortgage-Backed Securities ETF Grades
Year to date, the ETF has returned -0.2%, 0.1 percentage points worse than the category, which translates into a grade of C. The fund has returned 4.2% over the past year (grade of C).
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SMBS Trailing NAV Total Returns Data as of 7/31/26
| Last Month |
Last Quarter |
Ann'l. 1Yr |
Ann'l. 3Yr |
Ann'l. 5Yr |
Ann'l. 10Yr |
|
| SMBS Return (NAV) | -1.3% | -0.8% | 4.2% | na | na | na |
| SMBS Return (Price) | -1.1% | -0.7% | 4.4% | na | na | na |
| NAV +/- Price Return | -0.157% | -0.080% | -0.248% | na | na | na |
| Government Mortgage-Backed Bond Avg | -1.3% | -0.8% | 4.2% | 4.2% | 0.2% | 1.3% |
| SMBS Grade (NAV) | B | B | C | na | na | na |
| +/- Category (NAV) | -0.0% | -0.0% | -0.0% | na | na | na |
| SMBS Tax-Cost Ratio | na | na | 2.1% | na | na | na |
SMBS Annual NAV Total ReturnsData as of 7/31/26
| 2026 | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | |
| SMBS Return (NAV) | -0.2% | 8.4% | na | na | na | na | na | na | na | na | na |
| SMBS Return (Price) | -0.0% | 8.2% | na | na | na | na | na | na | na | na | na |
| NAV +/- Price Ret | -0.776% | -0.027% | na | na | na | na | na | na | na | na | na |
| Government Mortgage-Backed Bond Avg | -0.0% | 8.1% | 1.7% | 5.1% | -11.6% | -1.0% | 4.5% | 6.3% | 0.7% | 2.2% | 1.5% |
| SMBS Grade (NAV) | C | D | na | na | na | na | na | na | na | na | na |
| +/- Category | -0.1% | 0.3% | na | na | na | na | na | na | na | na | na |
| Risk Measures | |
| Beta: | na |
| R-Squared: | na |
| Standard Deviation: | na |
| Category Risk Index: | na |
| Category Risk Rating: | |
| Total Risk Index: | na |
| Total Risk Rating: | |
| Portfolio Characteristics | |
| Yield: | 5.2% |
| Total Assets: | $ 6,461 Mil |
| Share Class Assets: | $ 6,461 Mil |
| Turnover: | 20.0% |
| Expense Ratio: | 0.03% |
| Index Fund: | Yes |
| Index Tracked: | Bloomberg US MBS Float Adjusted TR USD |
| Index Weighting: | 100% |
| Leveraged: | No |
| Socially Responsible Fund: | No |
| Capital Gains Distribution Frequency: | Annually |
| Income Distribution Frequency: | Monthly |
Management Team
| Number of Managers: 2 | |||
| Longest Tenure: 1.7 years | |||
| Average Tenure: 1.7 years | |||
| Managers (Year): Portillo Alfonso (2024), Hastings Matthew (2024) | |||
Portfolio Composition (as of 7/31/26)
| # of Holdings: | 4277 |
| % in Top 10 Holdings: | 2.8% |
| Fund is Non-Diversified: | No |
| % in Foreign Issues: | 0.0% |
Portfolio Allocation |
|
| Domestic Stock: | 0.0% |
| Foreign Stock: | 0.0% |
| Preferred Stock: | 0.0% |
| Domestic Bond: | 98.5% |
| Foreign Bond: | 0.0% |
| Convertible Bond: | 0.0% |
| Other: | 0.0% |
| Cash: | 1.5% |
Purchase Information
| Legal Structure: | Open Ended Investment Company |
| Fund Family: | Schwab ETFs |
| Phone Number: | 877-824-5615 |
| Website: | www.csimfunds.com. |
| Inception Date: | November 18, 2024 |
Expenses and Fees
| Expense Ratio (%): | 0.03% (Rating: Low) |
| Category Average Expense Ratio (%): | 0.25% |
