Schwab Sector Views: Looking for Value
We continue to believe that it’s too early to make a strong, tactical move toward a more cyclical bent with sectors. Defensives have led the rally to this point and although we’ve seen some signs of a shift in leadership, with cyclicals outperforming on several instances lately, we need to see more convincing evidence before making a shift, both on the economic and market fronts. Additionally, we believe there’s a decent chance of a noticeable pullback in the broader market in the near term, leading us to have a bit of hesitancy to make a bold move at the moment.
However, we see some attractive values developing at the sector level, and although most often this space is dedicated to shorter-term, tactical moves, we suggest even longer-term investors use this opportunity to make sure their broad equity portfolio is appropriately diversified. With the underperformance to this point in the year, and still decent earnings performance for the most part, sectors such as industrials, materials, and technology appear to be undervalued based on several historical levels. We don’t believe valuation is a particularly useful timing tool, but as we urge a longer-term view to most equity positioning, buying cheaper shouldn’t be frowned upon. For investors that need to raise their allocations to the above mentioned sectors, we believe now is a great time to do so. There may be some continued underperformance, although we believe that is nearing an end, but waiting raises the risk of having to buy it at even higher levels, when the valuations may not be so attractive.
Conversely, if a portfolio has become over concentrated in the more defensive sectors, perhaps due to a search for yield, now would be a good time to bring down allocations to the utilities, staples, and telecommunications sectors, as valuations appear extended to us. One final note on portfolio construction, investors searching for yield in the equity world should recognize that it is more risky by nature than the fixed income world and should not be thought of as a direct replacement for fixed income holdings. Additionally, we urge investors looking for higher dividend payers to look beyond the traditional utilities and telecom sectors and recognize that there are quite a few stocks in even cyclical sectors that are paying a good dividend, and may have better prospects of growing that yield.
We strongly suggest looking for details on all of our specific sector views and information on our outperform and underperform ratings by reading the expanded analysis below, and then making adjustments to portfolios as you see fit. One final note: Our tactical recommendations change quickly at times as we continually monitor economic progress and factors influencing individual sectors, so check back often.
Source: Schwab Center for Financial Research and Standard and Poor's as of May 6, 2013.
We are starting to see some cracks develop in the consumer world, with retail sales numbers being somewhat disappointing and personal spending revealing relatively tepid results. We believe this is the start of what will be a stretch of disappointments that will result in the discretionary sector underperforming in the near future. Therefore, we continue to hold our underperform rating on the group, despite the admittedly disappointing results to this point.
Although resilient to this point, as mentioned there are cracks appearing as several retailers have reported disappointing results from the first quarter, and we continue to believe changes in the fiscal situation are impacting consumers at least marginally and will continue to do so for the foreseeable future. Higher payroll taxes for nearly everyone, higher taxes in general on upper income earners, and the impact from the spending cuts seem to us to inevitably impact the consumer. We believe this pressure on consumers' incomes at all parts of the spectrum will result in pressure on earnings potential for stocks in the discretionary group.
Additionally, from a broader perspective, the discretionary sector tends to be an early cyclical mover, meaning that it is one of the first sectors to react to changes in economic direction. And we’ve seen the group outperform the broader market over the past year. With the fiscal drags on growth facing the US economy in 2013, it seems unlikely to us that we’ll see a near-term increase in the growth rate, leading us to believe that the early cyclical trade may be nearing an end.
Certainly the picture is not all negative as we've seen some of the perceived larger headwinds facing consumers appear to dissipate somewhat. We have seen consumers reduce their debt load and housing show increasing signs of improving and the job market appears to be accelerating at least slightly. Additionally, commodity prices have eased at least somewhat, which could help to offset at least some of the burdens consumers are facing.
We acknowledge the American consumer has shown a remarkable ability to overcome obstacles, but we believe some near-term disappointment are in store as challenges grow, and reiterate our underperform rating on the discretionary sector.
Positive factors for the consumer discretionary sector:
- Inventories remain quite lean. This could provide retailers with some pricing power as activity picks up.
- The Federal Reserve continues to be quite accommodative, which could help to support the consumer, although further accommodation seems unlikely at this point.
- Global central banks appear to be firmly in an easing stance, which could help bolster the consumer.
Negative factors for the consumer discretionary sector:
- The unemployment rate is relatively high, and improvements have been slow to come.
- Credit standards remain tight, although there are signs of slight easing.
- Tax bills are moving higher in 2013, which should impact consumers' ability to spend.
- Recent retail sales readings have largely been below expectations.
- The Federal government is facing budget issues and is employing spending cuts and tax increases in order to address the issue. This could result in less money in consumers' pockets.
The consumer staples group has had a good start to the year as it appears to us that investors who had been out for some time are tiptoeing back into the stock market by starting with more defensive areas such as staples. We believe this has a limited time horizon and are concerned that the group may be a bit extended at this point, while also believing that investors may start to move out the risk spectrum, leaving us unwilling to move to an outperform rating on the staples sector at this point.
Although a consumer group, in contrast to the discretionary sector, the staples group is considered defensive because it tends to sell items that will be purchased regardless of the economic environment, such as toilet paper and laundry detergent. While this is a positive during tough economic times, it can also be a negative during times of improving economic conditions as consumers don't typically expand their spending on such items as the economy improves—demand tends to stay relatively constant. And with pocketbooks being squeezed even more as outlined in the consumer discretionary section, relative performance of the staples sector may hold up fairly well.
However, staples companies typically deal with relatively narrow margins, which can make it difficult to rapidly increase profitability and thus support swift growth in stock prices. These margins could be squeezed even further as the payroll tax hikes impact Americans.
Even when we had the group at an underperform rating, we weren't overly negative on many fundamentals of the staples group, and they remain relatively solid in our view. And since the market could be in for an increasingly tumultuous environment, we believe that a marketperform rating is most appropriate.
Positive factors for the consumer staples sector:
- Staples retailers have aggressively cut costs and are attempting to create more perceived value for consumers, which could support sales.
- The defensive consumer staples group could benefit from tighter consumer wallets if confidence declines in the coming months.
Negative factors for the consumer staples sector:
- Competition continues to accelerate and is exacerbated by the increasing emergence of low-cost, emerging market production, which could potentially cause pricing power in the group to evaporate by compressing margins and squeezing earnings.
- An acceleration of economic growth would likely cause the staples sector to underperform.
- Numerous central banks are now firmly in easing mode in an effort to stimulate the economy, which could hurt the more defensive sectors.
Oil prices continue to be relatively volatile, but within a relatively wide range. Energy, and especially crude oil, tends to have a large speculative element at times which can make it difficult to focus on the underlying fundamentals, but we believe that's exactly what investors should do. Although there are likely to be many twists and turns, we believe it ultimately comes down to supply and demand factors, influenced largely by the global economic outlook. And right now, while accommodative Fed policy would typically help the price of oil and the energy sector, as the dollar would often weaken, helping commodity prices, there appears to be bit of a race to the bottom with currencies that at least partially offsets the Fed's efforts. With these two competing forces, we believe a marketperform rating continues to be appropriate, but with the level of global accommodation by central banks continuing to rise, a move to outperform may not be far off.
We continue to believe the US and Chinese economies will drive the direction of the sector. To that end, China's response to its economic softening was initially more tepid than we would have expected but the new leadership appears to be stepping up. Conversely, the Federal Reserve has been extremely aggressive, but its effectiveness appears to be diminished at the present time.
Moving past the short-term movements in the energy markets, economic developments seem to be moving more in the direction of supporting the energy sector. The US economy continues to expand but at a modest rate, China appears to be moving past their soft patch, but Europe's economic situation continues to be in question with some disappointing data lately, although there are signs that the economic decline may be bottoming. However, there is also an increase in domestic production that could bring prices lower as US supplies of energy products build.
Longer term, we have a mainly positive outlook for the energy sector and believe a buying opportunity may present itself during a renewed retrenchment in oil prices. Developing countries will almost certainly continue to need more fuel, demand will likely continue to grow but we also note that supplies are increasing as well leaving us with a relatively neutral view for at least the time being.
Positive factors for the energy sector:
- Global uncertainties could threaten some supplies.
- Developing nations will likely need more energy as they improve their infrastructures and modernize their economies.
- Global central banks appear to generally have an easing bias, which could help the more cyclical sectors such as energy.
Negative factors for the energy sector:
- Supplies could increase dramatically with a renewed commitment to exploration and technological improvements. We've already seen new discoveries and existing fields produce more oil than originally projected.
- Purchasing manager index (PMI) surveys around the globe continue to be lukewarm, which could portend improving growth prospects.
- Conservation efforts and new technology could impact the growth in demand for energy products.
After a nice, somewhat surprising to us, start to the year, the performance of the financials group has tailed off somewhat and it now appears to be moving more in line with the overall market, which is what we believe is most likely to continue in the near future.
There are still risks for the group, although we believe the sector's fundamentals and broader macroeconomic developments help to offset some of those risks. An extremely accommodative Fed provides financial companies with low borrowing rates on money that they can then lend out at higher rates. And although the spread isn't historically large, the potential for longer-term interest rates to move slightly higher while the short end remains anchored by the Fed provides the opportunity for margin expansion. Also, balance sheets of consumers and companies appear to be improving. Corporate cash balances are high and household debt as a percentage of disposable income for consumers has fallen. This has enabled banks to gradually reduce the reserves on their balance sheets for loan losses. And the continued improvement in the housing market should, in our view, bolster financials as they are able to get foreclosed homes off their balance sheets more quickly, while mortgage demand may start to rise.
We still have concerns, and chief among them is the regulatory environment. Regulations that limit trading financial institutions can do for themselves, which has been a major profit driver for some companies, remain a concern for us. And already-instituted new capital requirements restrict the amount of money banks can lend, limiting profit potential for many of them.
We maintain relative confidence in the ability of the financial industry to reshape itself and adjust to the changing environment as it has done so many times, but are watching developments in Washington carefully to determine what our next move may be.
Positive factors for the financials sector:
- Most financial institutions have paid back government loans and are increasing share buybacks and dividend payments, illustrating their growing health and stability.
- Recent delinquent loan estimates have decreased among credit card companies, indicating improving balance sheets.
- Lending standards have loosened somewhat, which could help loan volume grow.
- Businesses could increase borrowing once more certainty regarding the fiscal situation occurs.
Negative factors for the financials sector:
- Confidence in the financials sector, though improved, remains shaky. Concerns about hangover from the housing bust—combined with increased government regulation—continue to hover over the group.
- Government intervention, such as new limits on certain fees that can be charged, has already started to affect the financial industry and could hold back performance for the foreseeable future.
- A new round of foreclosure uncertainty or a push by the Federal government to again loan to higher risk borrowers could pose problems for the financial sector.
We've liked the health care sector for some time as the fundamentals of the group have remained attractive to us but the area continues to face political headwinds, leading us to maintain our marketperform rating. Health care continues to be at the center of much political discussion, even after the Affordable Care Act was solidified by a Supreme Court decision and the election results. However, implementing the numerous provisions of the Act still remain under debate and seem to change on a relatively frequent basis—causing some additional volatility in the group. We did see a recent positive development for the sector, and managed care insurers specifically, as Congress reversed its plan to cut Medicare Advantage payments.
Containing costs remain a high-profile issue and increased government involvement could mean a more challenging environment for at least some of the space. Until we get a little better handle on what impact the current negotiations have on the economy as a whole and the health care sector specifically, we believe a marketperform rating is appropriate. The sequestration cuts, if sustained, would likely have an impact on the sector due to the scheduled cuts in Medicare reimbursements (different from the cuts reversed above).
But it's also important to remember that the political aspect is only one piece to the puzzle and that investors should also look to the overall fundamental picture. In our view, these fundamentals look good as valuations are still depressed, balance sheets are solid, the group has good dividend yields, and the overall cost structure appears to have been much improved. And while the fight in Washington is largely on how to pay for health care, there seems to be little debate that there is an increasing demand for health care products and services, which is typically a good sign for an industry.
Finally, we believe the health care sector provides both growth and defensive characteristics, which can be attractive to investor, leading to our relatively positive view of the sector and the possibility that it may regain its outperform rating in the near future.
Positive factors for the health-care sector:
- The aging population could provide a boon for the industry as an increasing number of Americans require more extensive drug treatments and medical care.
- Americans are increasingly obese, which results in a greater need for medical attention due to the myriad of health issues that coincide with obesity.
- Balance sheets in the health-care sector remain flush with cash, boosting the possibility of higher dividend payments, share-enhancing stock buybacks, and mergers and acquisitions.
Negative factors for the health-care sector:
- Government regulation will likely continue to increase during the coming years as more seniors demand intervention in order to theoretically lower their out-of-pocket health-care costs.
- The current and fiscal situation in Washington creates continued uncertainty regarding the group.
- Medicare spending could be reduced as the government seeks to reduce the deficit, which could hurt some of the health care sector.
The global manufacturing picture appears quite murky to us at the present time. The national ISM Manufacturing Index stayed in territory depicting expansion but was weaker than expected, causing a small bit of concern that the US recovery may be stalling slightly. Additionally, Europe remains weak and recent data has disappointed, but governments appear to be shifting off of some of the more onerous austerity policies that could help to boost growth and China's situation is still uncertain but appears to be at least marginally improving. This somewhat disjointed picture leads us to believe that a marketperform rating remains appropriate.
We have concerns, but they are slowly being balanced out as Europe is in an apparent recession but has made progress on their debt crisis, despite recent flare-ups, China's growth is slow relative to history but may have bottomed, India's bureaucracy remains troubling although there are nascent signs of reforms, and US political concerns continue to weigh on companies but some dialing down of the rhetoric in Washington appears to be helping. We believe corporations will remain somewhat cautious in the near term, but the investment picture appears to be brightening as the year progresses.
We also continue to watch fiscal austerity measures around the world, which could dampen growth in the industrials arena, but as mentioned above do appear to be dialed down at least somewhat. Finally, after a long tightening campaign by China that has dented expectations for global growth, the country is reversing course and somewhat easing monetary policy, but at a rate that has been somewhat disappointing and could dampen enthusiasm for the industrials sector.
Positive factors for industrials:
- Corporate balance sheets remain relatively cash rich, which could help push management to invest in new, more-efficient equipment to help offset production losses due to layoffs.
- Lending standards, while still tight, have started to loosen, which should help boost capital spending.
- Inventories in much of the manufacturing area appear relatively low, leading to the possibility of a demand-inspired rebuilding phase.
- Countries are now considering undoing some of their more stringent austerity-related policies, which could help to boost economic activity and demand for industrial goods.
Negative factors for industrials:
- Access to credit remains limited in many cases—among smaller businesses, for example—which tends to dampen spending plans.
- Fiscal austerity, if maintained, could result in slower economic growth and decreased demand for industrial products.
- The Chinese central bank's apparently cautious approach to easing has resulted in concerns that the country's growth may slow more than initially expected.
We've seen some nascent signs of a perk up in performance of the, to this point in the year, disappointing tech sector, and we continue to believe that the sector is poised to outperform and reward those investors who are patient. The innovation and entrepreneurial spirit that seems to pervade the tech sector are factors that are sometimes difficult to quantify but make us excited about the future of the sector and push us to have an outperform view on the group.
With large cash balances, increasing dividend payments, solid management and tight inventory controls, the tech sector appears far more stable than it was in the late 1990s environment that so many still remember. We've been touting this stability as one of the reasons to stick with the group and in fact the sector has outperformed during the past couple of downturns in the market, illustrating some of the tech defensiveness we’ve seen developing. We believe those who remain invested in tech will continue to be rewarded with outperformance in the coming months.
The fundamentals of the group also appeal to us. Companies that have underinvested in technological improvements during the past couple of years appear to be at the point where they need to upgrade equipment. Such investments are typically attractive because they tend to increase companies' efficiency and productivity at all levels.
As a result, companies can produce more with fewer workers—as we're seeing with relatively high productivity numbers but still-high unemployment readings—which allows them to cut back on costs and potentially expand margins.
Additionally, balance sheets in the sector appear solid, with large cash balances and relatively low debt. This enables the group to increase dividends and pursue mergers and acquisitions that might help performance as competition is removed and expenses consolidated. We believe this also helps provide stability to the group, which in turn gives it a certain level of defensiveness mentioned above, contrary to its high-beta history.
Positive factors for information technology:
- Growth in business investment in technology is now outpacing growth in total business investment.
- Real tech investment has been below trend for several years, which could bode well for the future of the sector as spending returns to more normal levels.
- We're starting to see banks loosen lending standards, which could slowly help revive capital investments.
Negative factors for information technology:
- Increasing global competition, especially in areas with low labor costs, will likely continue to compress profit margins.
- We see signs that companies remain hesitant to increase capital spending.
- Governments are reining in spending, which could dampen investment in technology-related projects.
After struggling through the latter half of 2012, the materials sector perked up to start the year but has returned to the struggles seen late last year. We believe this mixed action is largely due to uncertainty surrounding global economic growth with a recession in Europe that may or may not be bottoming, Chinese growth that has disappointed, and a stronger US dollar that dampens profitability from abroad. Risks appear somewhat elevated as none of the improvements are appear to be gaining substantial traction but we believe our marketperform rating is appropriate as we believe global growth will slowly take hold.
Accommodative monetary policy, as we are now seeing in most of the globe, has typically been a positive for the materials sector as growth expectations increase. China recently reduced its reserve requirements, a definite sign of easing, while India surprisingly implemented a larger rate cut than was expected. These actions have not resulted in a surge in growth so far, however, but we view these as signs that important central banks around the world are starting to come over to the Fed's view of bolstering growth. This could provide a bit of a tailwind behind the materials sector, warranting at least a marketperform rating, with an eye toward another upgrade should global improvement continue.
Positive factors for the materials sector:
- Developing countries continue to need more natural resources to support their infrastructure building.
- Global central banks are now largely in easing mode, which should help to support economic activity and the materials sector.
Negative factors for the materials sector:
- Chinese demand for processed commodities might be slowing as technological advances and a build-out of production facilities allow the country to produce more of its own materials. China recently transitioned from a net importer to a net exporter of steel.
- Several governments are implementing austerity measures, which could crimp demand for materials.
- Wage costs are rising in the materials sector as we’ve seen skilled labor shortages in certain segments of the market.
- Continued US dollar strength could undermine the results in the materials sector.
The telecom sector held up relatively well during the pullback seen in the market near the end of 2012 and we are keeping are marketperform rating on the group, but concerns are growing. The yield provided by the sector, and traditionally defensive nature of the group, can make it attractive to investors in an environment such as we are seeing now, leading us to maintain our current rating…at least for now.
The telecom sector has lost some of its traditional defensive appeal, in our opinion, given that the group has moved much of its business model from the seemingly stable, regulated fixed-line business to the more variable, consumer-dependent wireless arena, while also dealing with an onslaught of competition from a variety of sources. But consumers are increasingly demanding more wireless services, which could boost revenues, but costs remain elevated which could make profitability more difficult.
Generally, many investors apparently do still view telecom as defensive, seeing the remaining fixed-line business as a cushion against variable revenues in less certain times. Additionally, dividend yields in the space remain relatively attractive to income-hungry investors. But we are seeing wage costs, which had been under control, start to rise, while announcements of increases in capital expenditures could reduce margins, causing us some increasing concern.
Competition for increasingly budget-conscious consumers remains fierce, and telecom certainly hasn't been immune to bargain-hunting shoppers, as evidenced by declining pricing power in the space. We're watching developments in this area especially closely given that new products still seem to be enticing consumers to spend, but we wonder how many times the sector can draw from that well.
In contrast to the technology sector, companies in the telecom sector have a lot of debt on their balance sheets, so we continue to view the group with caution.
Positive factors for the telecommunications sector:
- Wireless demand appears to be increasing as more communication and media devices move to the wireless arena, although some of that movement is likely to take away from fixed-line revenue.
- The higher dividends typically paid by telecom companies are increasingly attracting investors tired of paltry fixed-income yields. But the yield advantage these companies have over the market appears to be diminishing.
Negative factors for the telecommunications sector:
- Consumer spending on telecom compared to total spending is now falling, which has typically coincided with underperformance for the sector.
- Net profit margins are declining for the telecom sector as competition squeezes margins.
- Capital expenditures in the telecom space are rising as companies look to improve and expand their networks, which could be a burden on profitability in the near future.
- The telecom sector has the highest debt-to-equity ratio of any nonfinancial sector. That could hurt the group in this time of tight credit.
We have been concerned about stock valuations in the utilities sector for some time as investors chased the relatively higher yields, and we cut the rating to underperform from marketperform. But after a bought of selling, that also may have been due partially to investors unloading high dividend payers ahead of a potential tax increase, which is now reality, we recently moved the rating back to marketperform but are having renewed concerns after the nice run to start the year for the utilities group.
Although the Fed appears to be attempting to make riskier assets more attractive through extremely loose monetary policy, the traditionally defensive utilities sector seems to be attracting renewed investor interest as fixed income yields remain low. Should interest rates creep higher with stronger economic growth, the yield characteristics of the utilities sector may become less attractive, but that doesn't appear to be in the cards in the near term, leading us to believe a marketperform rating is most appropriate.
Certainly, if the economic situation deteriorates, the utilities sector could benefit from a search for perceived safer assets. Additionally, an improving housing market could result in an increase in electricity needs in developing areas, and we're seeing signs that may be occurring as housing starts have started to creep higher. It is this balanced outlook that leads us to our rating, although developments could occur in the next couple of months that lead us to move yet again.
Positive factors for the utilities sector:
- Dividend-paying stocks remain attractive as long as yields on conservative fixed-income products remain relatively low. And should economic prospects decline more than currently expected, defensive, dividend-paying stocks could become even more attractive.
Negative factors for the utilities sector:
- Utilization rates of electric and gas utilities have moved down modestly while production has spiked, indicating a potential oversupply issue that could pressure margins.
- Capacity growth has been rising, which has been a sign of underperformance for the sector in the past.
- Accelerating economic growth would likely make the defensive utilities sector less attractive.
About Schwab Sector Views
Schwab Sector Views were developed by Charles Schwab & Co., Inc.'s ("Schwab's") Investment Strategy Council. Schwab Sector Views are Schwab's outlook on the 10 broad sectors as classified by the widely recognized Global Industry Classification Standard groupings. The GICS structure comprises sectors, industry groups, industries and subindustries. Schwab Sector Views are at the sector level. While Schwab Equity Ratings and Schwab Industry Ratings utilize a disciplined approach that evaluates all stocks (Schwab Equity Ratings) or all industries (Schwab Industry Ratings) in the same manner, Schwab Sector Views uses analytical techniques and methods that vary from sector to sector.
Explanation of columns in the table: The benchmark weights are provided for reference and represent each sector's market capitalization weight in its index.
Schwab Sector Views represent our current outlook on each particular sector. All investors should be well-diversified across all sectors. However, investors who want to tactically overweight or underweight particular sectors may want to consider our three- to six-month relative performance outlook reflected in this column. These views refer only to the domestic equity portion of investors' portfolios.
How should I use Schwab Sector Views?
Investors should generally be well-diversified across all sectors, at or near the respective sector market capitalization weights relative to the overall market (benchmark). However, investors who want to make tactical shifts to those weights with a goal of outperforming the overall market can consider the Schwab Sector Views as a resource. Schwab clients can also use the Stock Screener or Mutual Fund Screener to help identify buy and/or sell stock or mutual fund candidates in particular sectors that they may be underweighted or overweighted in their portfolios.
How to use Schwab Sector Views in conjunction with Schwab Equity Ratings
Sector diversification is an important building block in portfolio construction. Schwab Sector Views are expressed in terms of outperform, marketperform and underperform, and can be particularly helpful in evaluating and monitoring your portfolio composition. Schwab Sector Views can be useful in screening new stock purchases and in identifying portfolio holdings for possible sale. A review of sector weights coupled with individual stock concentration should be a critical measure of equity portfolio diversification. Schwab Equity Ratings provide an objective and powerful approach for helping you select and monitor stocks.
Schwab Sector Views do not represent a personalized recommendation of a particular investment strategy to you. You should not buy or sell an investment without first considering whether it is appropriate for you and your portfolio. Additionally, you should review and consider any recent market news.
Indexes are unmanaged, do not incur management fees, costs and expenses, and cannot be invested in directly. The table indicates returns based on gross returns. If commissions and other costs are deducted, the performance would be lower. Past performance is no guarantee of future results.
The GICS was developed by and is the exclusive property of Morgan Stanley Capital International Inc. and Standard & Poor's. GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc.
The Schwab Center for Financial Research is a division of Charles Schwab & Co., Inc.
Diversification strategies do not assure a profit and do not protect against losses in declining markets.
This information is not intended to be a substitute for specific individualized tax, legal or investment planning advice. Where specific advice is necessary or appropriate, Schwab recommends consultation with a qualified tax advisor, CPA, Financial Planner or Investment Manager.
The information contained herein is obtained from sources believed to be reliable, but its accuracy or completeness is not guaranteed. This report is for informational purposes only and is not a solicitation or a recommendation that any particular investor should purchase or sell any particular security. Schwab does not assess the suitability or the potential value of any particular investment. All expressions of opinions are subject to change without notice.
Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve.