<PAGE> 1
[SCHWABFUNDS LOGO]
SCHWAB
MUNICIPAL
MONEY FUND
------------------
SCHWAB CALIFORNIA
MUNICIPAL
MONEY FUND
------------------
SCHWAB NEW YORK
MUNICIPAL
MONEY FUND
SEMI-ANNUAL REPORT
JUNE 30, 1997
<PAGE> 2
[PHOTO OF CHARLES SCHWAB]
Dear Shareholder,
With the support of investors like you, SchwabFunds(R) continues to be among the
largest and fastest-growing mutual fund families in the nation. Charles Schwab
Investment Management, Inc. (CSIM) manages over $50 billion in assets for more
than 2.5 million SchwabFunds shareholders and offers 30 funds spanning a
spectrum of financial markets and investing styles.
LONG-TERM INVESTMENT STRATEGIES
When it comes to investing, patience is a virtue. Given the market volatility of
recent months, it is important to maintain the discipline to adhere to your
asset allocation plan--and to ensure you have a diversified investment
portfolio. We created the SchwabFunds Family(R) to offer time-tested strategies
for long-term investing--Indexing, Asset Allocation, Quantitative Models, and
Fund-of-Funds--and to provide investors with easy, cost-efficient options to
help achieve portfolio diversification.
COMMITMENT TO VALUE
In our ongoing commitment to provide cost-efficient ways for you to invest, we
recently introduced a new class of shares--Select Shares(TM)--for each of
our four index funds. Select Shares can offer investors even greater savings
through significantly lower expense ratios.
EXPANDING CHANNELS OF COMMUNICATION
If you're among the millions of people exploring the Internet, I encourage you
to visit our Web site at www.schwab.com/funds. There you'll find a wealth of
online information on SchwabFunds as well as other resources available at
Schwab. You can also access mutual fund performance data, chart daily net asset
values, request a free fund prospectus, trade fund shares and more--24 hours a
day. Continuing our efforts to provide you with up-to-date, useful information,
we have recently added monthly portfolio manager commentaries on selected
SchwabFunds to our Web site. In these commentaries, our expert portfolio
managers give insights into market activity and translate the effects of that
activity on fund performance.
Thank you for placing your trust in SchwabFunds. We will continue to explore new
strategies to help meet your investment needs.
/s/ Charles R. Schwab
---------------------
Charles R. Schwab
<PAGE> 3
[SCHWAB MONEYFUNDER GRAPHIC BANNER]
Make Your
Money Work
Harder!
Use this envelope to easily add
your Schwab Money Market Funds.
Charles Schwab
<PAGE> 4
[SCHWAB MONEYFUNDER GRAPHIC BANNER]
TAKE ADVANTAGE OF THIS OPPORTUNITY TO
ADD TO YOUR SCHWAB MONEY MARKET FUNDS.
Now you can add to your investment by using this convenient envelope
and slip below. Please note that this envelope may not be used for
any initial investments in Schwab Money Market Funds. Please call
1-800-2NO-LOAD for a prospectus containing more information
including fees and expenses. Be sure to read the prospectus carefully
before investing.
SO DON'T DELAY. USE THIS CONVENIENT
SCHWAB MONEYFUNDER TO SEND YOUR CHECK TODAY!
______________________________________________________________________________
PLEASE DETACH HERE.
SCHWAB MONEYFUNDER
__________________
Please enclose your check and this completed MoneyFunder slip
in the attached postage-paid envelope.
______________________________________________________________________________
Name
X
______________________________________________________________________________
Signature
[ ] Check here if you would like more Schwab
MoneyFunders for future use.
*SUBSEQUENT MINIMUM $100, CUSTODIAN & IRA ACCOUNTS $1. AN INVESTMENT
CONSTITUTES THE PURCHASE OF SHARES IN THE MONEY FUND YOU HAVE PREVIOUSLY CHOSEN
AS THE PRIMARY FUND FOR YOUR BROKERAGE ACCOUNT.
+THIS ENVELOPE MAY NOT BE USED FOR INITIAL PURCHASES OF VALUE ADVANTAGE
INVESTMENTS. SUBSEQUENT INVESTMENT MINIMUM IS $5,000 ($2,000 FOR IRAS AND
OTHER RETIREMENT ACCOUNTS). IF YOU WOULD LIKE MORE INFORMATION, PLEASE CALL
1-800-2 NO-LOAD.
(C)1997 Charles Schwab & Co., Inc. All rights reserved. Member SIPC/NYSE.
Printed on recycled paper. TF4827(8/97) CRS 20110
_____ _____ _____ _____ - _____ _____ _____ _____
SCHWAB ACCOUNT NUMBER
PLEASE INDICATE HOW YOUR INVESTMENT SHOULD BE ALLOCATED:
[ ] Add to my sweep money market fund.* $________
[ ] Schwab Value Advantage Money Fund*+ $________
[ ] Schwab Municipal Money Fund--Value
Advantage Shares(TM)+ $________
[ ] Schwab California Municipal Money Fund--Value
Advantage Shares(TM) (for California taxpayers only)+ $________
[ ] Schwab New York Municipal Money Fund--Value
Advantage Shares(TM) (for New York taxpayers only)+ $________
TOTAL AMOUNT ENCLOSED $________
IF NO FUND IS INDICATED, OR YOUR INVESTMENT IS BELOW THE SUBSEQUENT
MINIMUM FOR THE VALUE ADVANTAGE INVESTMENTS+, YOUR INVESTMENT WILL GO
INTO THE SWEEP MONEY FUND YOU'VE DESIGNATED IN YOUR SCHWAB ACCOUNT.
_________________________________
(Lift here for more information.)
_________________________________
<PAGE> 5
[CHARLES SCHWAB]
JUST FOLLOW THESE EASY STEPS:
1. Fill out the attached Schwab MoneyFunder slip completely, including your
name, account number, signature and the amount of your check. Please use a
separate slip for each account.
2. Make your check payable to CHARLES SCHWAB & CO., INC., and enclose your
check with the completed slip in this postage-paid envelope.
3. Then just drop your Schwab MoneyFunder in the mail today--and start putting
your money to work! If you have any questions, don't hesitate to call your
local Schwab office or 1-800-2 NO-LOAD.
THIS ENVELOPE MUST BE PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS. AN
INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT.
THERE CAN BE NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A STABLE NET
ASSET VALUE OF $1.00 PER SHARE.
<PAGE> 6
ATTN: Dept. FP 333-7
-------------
NO POSTAGE
NECESSARY IF
MAILED IN THE
UNITED STATES
-------------
- -------------------------------------------------------
BUSINESS REPLY MAIL
FIRST-CLASS MAIL PERMIT NO. 18125 SAN FRANCISCO, CA
- -------------------------------------------------------
POSTAGE WILL BE PAID BY ADDRESSEE
CHARLES SCHWAB & CO INC
PO BOX 7783
SAN FRANCISCO CA 94120-9330
<PAGE> 7
TABLE OF CONTENTS
A WORD FROM SCHWABFUNDS(R) ..................................... 2
SCHWAB MUNICIPAL MONEY FUND .................................... 4
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND ......................... 6
SCHWAB NEW YORK MUNICIPAL MONEY FUND ........................... 8
THE PORTFOLIO MANAGEMENT TEAM .................................. 10
MARKET OVERVIEW ................................................ 11
QUESTIONS TO THE PORTFOLIO MANAGEMENT TEAM ..................... 16
GLOSSARY OF TERMS .............................................. 19
PORTFOLIO SUMMARIES ............................................ 20
FINANCIAL STATEMENTS AND NOTES ................................. 23
1
<PAGE> 8
A WORD FROM SCHWABFUNDS(R)
We're pleased to report on the performance of the three Schwab Municipal Money
Funds listed below (the Funds) for the six-month period ended June 30, 1997:
- - Schwab Municipal Money Fund
- - Schwab California Municipal Money Fund
- - Schwab New York Municipal Money Fund
During the reporting period, the Funds continued to provide the current
tax-exempt income 1 combined with capital stability and liquidity. The following
pages contain additional information on the Funds' performances during the
reporting period and on their portfolios. Please remember that while each Fund
seeks to maintain a stable $1.00 share price to protect your principal, as with
all money funds, there can be no assurance that a Fund will be able to maintain
a $1.00 net asset value. It is also important to understand that your investment
in a Fund is not insured or guaranteed by the U.S. Government.
Each Fund has two classes of shares, Sweep Shares and Value Advantage
Shares(TM), which are both presented in this semi-annual report. These two
classes were designed for different purposes as explained on the following page.
Depending on your cash needs and investment profile, either or both of the
classes of the Funds may have a place in your investment plan.
1 Income from all of the Funds may be subject to federal alternative minimum tax
(AMT) and income from the Schwab Municipal Money Fund may be subject to state
and local income taxes.
2
<PAGE> 9
SWEEP SHARES
Sweep Shares are designed for frequent access - such as your short-term daily
cash needs. They can be linked to your Schwab brokerage account and contain a
feature which automatically "sweeps" your uninvested cash balances of at least
$100 into the Sweep Shares class of the fund you designate. Likewise, your Sweep
Shares balances can also be used to settle trades and automatically cover other
day-to-day transactions such as margin calls.
VALUE ADVANTAGE SHARES(TM)
Value Advantage Shares are designed to be longer-term money market investment
vehicles for balances that do not require frequent access - and can help fill
the cash equivalent sector in your asset allocation plan. There are higher
minimum balance requirements and certain transaction restrictions associated
with an investment in Value Advantage Shares that do not apply to Sweep Shares.
Also, unlike the Sweep Shares, the Value Advantage Shares are not designed to
automatically transfer cash balances to settle debit balances in your Schwab
account. These policies result in lower costs, which are designed to provide
higher yields.
If you would like more information on either the Sweep Shares or the Value
Advantage Shares of the Funds, or on other Schwab Money Market Funds, please
call our toll-free line, 1-800-435-4000, and request a free prospectus which
contains more information including fees and expenses. Be sure to read the
prospectus before investing.
3
<PAGE> 10
SCHWAB MUNICIPAL MONEY FUND
PERFORMANCE REVIEW
The table below presents 7-day average yields as of the end of the reporting
period for both the Sweep Shares and Value Advantage Shares(TM). Please remember
that money market fund yields fluctuate and past performance is no guarantee of
future results.
<TABLE>
<CAPTION>
YIELD SUMMARY AS OF 6/30/97 2
- --------------------------------------------------------------------------------
Sweep Shares Value Advantage Shares
- --------------------------------------------------------------------------------
<S> <C> <C>
7-day Current Yield 3.44% 3.65%
- --------------------------------------------------------------------------------
7-day Effective Yield 3.50% 3.72%
- --------------------------------------------------------------------------------
7-day Taxable Equivalent Effective Yield 3 5.79% 6.16%
- --------------------------------------------------------------------------------
</TABLE>
THE OPPORTUNITY FOR HIGHER YIELDS, AFTER TAXES
If you're in a high tax bracket, the federal tax-exempt income 4 which may be
paid by Schwab Municipal Money Fund can provide you with higher yields than
those of taxable money funds on a taxable equivalent basis. In fact, as shown
below, compared with the average 7-day effective yield for first-tier taxable
money funds of 5.06%, the Sweep Shares and the Value Advantage Shares offered a
yield advantage of 0.67% and 1.03%, respectively, on a taxable equivalent
basis.
YIELDS AS OF 6/24/97 5
<TABLE>
<CAPTION>
Value Advantage Average Taxable
Sweep Shares Shares Money Fund
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
7-day Taxable Equivalent
Effective Yield 3 5.73% 6.09% 5.06%
- --------------------------------------------------------------------------------
</TABLE>
2 A portion of the Fund's fees were waived or reimbursed during the reporting
period. Without the waivers or reimbursements, as of 6/30/97, the 7-day current,
7-day effective, and 7-day taxable equivalent effective yields for the Sweep
Shares would have been, respectively: 3.21%, 3.26%, and 5.40%. For the Value
Advantage Shares, as of 6/30/97, the 7-day current, 7-day effective, and 7-day
taxable equivalent effective yields would have been, respectively: 3.39%, 3.45%,
and 5.71%.
3 Taxable equivalent yield assumes a 1997 maximum federal regular income tax
rate of 39.60%.
4 Income may be subject to state and local taxes and federal AMT.
5 Source: IBC Financial Data, Inc.'s weekly average 7-day effective yield for
273 funds in the first-tier category of taxable money funds, as of 6/24/97. Past
performance is no guarantee of future results. A portion of the Fund's fees were
waived or reimbursed during the reporting period. Without the waivers or
reimbursements, as of 6/24/97, the 7-day taxable equivalent effective yields for
the Sweep Shares and the Value Advantage Shares would have been 5.33% and 5.65%,
respectively.
4
<PAGE> 11
PORTFOLIO COMPOSITION
Schwab Municipal Money Fund invests in a diversified portfolio of high-quality,
short-term municipal securities issued by or on behalf of states, territories,
and possessions of the United States and their political subdivisions, agencies,
and instrumentalities. The chart below illustrates the composition of the Fund's
portfolio as of June 30, 1997 and is not indicative of holdings after that date.
A complete listing of securities in the Fund's portfolio as of June 30, 1997 is
provided in the Schedule of Investments later in this report.
SCHWAB MUNICIPAL MONEY FUND
PORTFOLIO COMPOSITION AS OF JUNE 30, 1997
[PIE CHART]
<TABLE>
<S> <C>
Variable Rate Obligations 64%
Other 3%
Mandatory & Optional Put Bonds 10%
Notes 10%
Tender Option Bonds 2%
Tax-Exempt Commercial Paper 11%
</TABLE>
5
<PAGE> 12
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
PERFORMANCE REVIEW
The table below presents 7-day average yields as of the end of the reporting
period for both the Sweep Shares and Value Advantage Shares(TM). Please remember
that money market fund yields fluctuate and past performance is no guarantee of
future results.
<TABLE>
<CAPTION>
YIELD SUMMARY AS OF 6/30/97 6
- --------------------------------------------------------------------------------
Sweep Shares Value Advantage Shares
- --------------------------------------------------------------------------------
<S> <C> <C>
7-day Current Yield 3.28% 3.48%
- --------------------------------------------------------------------------------
7-day Effective Yield 3.33% 3.54%
- --------------------------------------------------------------------------------
7-day Taxable Equivalent Effective Yield 7 6.08% 6.46%
- --------------------------------------------------------------------------------
</TABLE>
THE OPPORTUNITY FOR HIGHER YIELDS, AFTER TAXES
If you're in a high tax bracket, the double tax-exempt income 8 which may be
paid by Schwab California Municipal Money Fund can provide you with higher
yields than those of taxable money funds on a taxable equivalent basis. In fact,
as shown below, compared with the average 7-day effective yield for first-tier
taxable money funds of 5.06%, the Sweep Shares and the Value Advantage Shares
offered a yield advantage of 0.93% and 1.31%, respectively, on a taxable
equivalent basis.
<TABLE>
<CAPTION>
YIELDS AS OF 6/24/97 9
- -------------------------------------------------------------------------------------------------------------------
Sweep Shares Value Advantage Shares Average Taxable Money Fund
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
7-day Taxable Equivalent
Effective Yield 7 5.99% 6.37% 5.06%
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
6 A portion of the Fund's fees were waived or reimbursed during the reporting
period. Without the waivers or reimbursements, as of 6/30/97, the 7-day current,
7-day effective, and 7-day taxable equivalent effective yields for the Sweep
Shares would have been, respectively: 3.03%, 3.06%, and 5.62%. For the Value
Advantage Shares, as of 6/30/97, the 7-day current, 7-day effective, and 7-day
taxable equivalent effective yields would have been, respectively: 3.22%, 3.27%,
and 5.97%.
7 Taxable equivalent yield assumes a 1997 maximum combined federal regular
income tax and California state and personal income tax rate of 45.22%.
8 Income may be subject to federal AMT.
9 Source: IBC Financial Data, Inc.'s weekly average 7-day effective yield for
273 funds in the first-tier category of taxable money funds, as of 6/24/97. Past
performance is no guarantee of future results. A portion of the Fund's fees were
waived or reimbursed during the reporting period. Without the waivers or
reimbursements, as of 6/24/97, the 7-day taxable equivalent effective yields for
the Sweep Shares and the Value Advantage Shares would have been 5.49% and 5.88%,
respectively.
6
<PAGE> 13
PORTFOLIO COMPOSITION
Schwab California Municipal Money Fund invests in high-quality, short-term
municipal securities issued by the state of California, its agencies and
instrumentalities. The chart below illustrates the composition of the Fund's
portfolio as of June 30, 1997 and is not indicative of holdings after that date.
A complete listing of securities in the Fund's portfolio as of June 30, 1997 is
provided in the Schedule of Investments later in this report.
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
PORTFOLIO COMPOSITION AS OF JUNE 30, 1997
[PIE CHART]
<TABLE>
<S> <C>
Notes 17%
Tender Option Bonds 2%
Tax-Exempt Commercial Paper 16%
Variable Rate Obligations 62%
Other 3%
</TABLE>
7
<PAGE> 14
SCHWAB NEW YORK MUNICIPAL MONEY FUND
PERFORMANCE REVIEW
The table below presents 7-day average yields as of the end of the reporting
period for both the Sweep Shares and Value Advantage Shares(TM). Please remember
that money market fund yields fluctuate and past performance is no guarantee of
future results.
<TABLE>
<CAPTION>
YIELD SUMMARY AS OF 6/30/97 10
- --------------------------------------------------------------------------------
Sweep Shares Value Advantage Shares
- --------------------------------------------------------------------------------
<S> <C> <C>
7-day Current Yield 3.31% 3.55%
- --------------------------------------------------------------------------------
7-day Effective Yield 3.36% 3.61%
- --------------------------------------------------------------------------------
7-day Taxable Equivalent Effective Yield 11 6.27% 6.74%
- --------------------------------------------------------------------------------
</TABLE>
THE OPPORTUNITY FOR HIGHER YIELDS, AFTER TAXES
If you're in a high tax bracket, the triple tax-exempt income 12 which may be
paid by Schwab New York Municipal Money Fund can provide you with higher yields
than those of taxable money funds on a taxable equivalent basis. In fact, as
shown below, compared with the average 7-day effective yield for first-tier
taxable money funds of 5.06%, the Sweep Shares and the Value Advantage Shares
offered a yield advantage of 1.06% and 1.51%, respectively, on a taxable
equivalent basis.
<TABLE>
<CAPTION>
YIELDS AS OF 6/24/97 13
- --------------------------------------------------------------------------------
Value Advantage Average Taxable
Sweep Shares Shares Money Fund
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
7-day Taxable Equivalent
Effective Yield 11 6.12% 6.57% 5.06%
- --------------------------------------------------------------------------------
</TABLE>
10 A portion of the Fund's fees were waived or reimbursed during the reporting
period. Without the waivers or reimbursements, as of 6/30/97, the 7-day current,
7-day effective, and 7-day taxable equivalent effective yields for the Sweep
Shares would have been, respectively: 2.99%, 3.03%, and 5.66%. For the Value
Advantage Shares, as of 6/30/97, the 7-day current, 7-day effective, and 7-day
taxable equivalent effective yields would have been, respectively: 3.17%, 3.22%,
and 6.01%.
11 Taxable equivalent yield assumes a 1997 maximum combined federal regular
income tax and New York state and New York City personal income tax rate of
46.43%.
12 Income may be subject to federal AMT.
13 Source: IBC Financial Data, Inc.'s weekly average 7-day effective yield for
273 funds in the first-tier category of taxable money funds, as of 6/24/97. Past
performance is no guarantee of future results. A portion of the Fund's fees were
waived or reimbursed during the reporting period. Without the waivers or
reimbursements, as of 6/24/97, the 7-day taxable equivalent effective yields for
the Sweep Shares and the Value Advantage Shares would have been 5.51% and 5.84%,
respectively.
8
<PAGE> 15
PORTFOLIO COMPOSITION
Schwab New York Municipal Money Fund invests in high-quality, short-term
municipal securities issued by the state of New York, its agencies and
instrumentalities. The chart below illustrates the composition of the Fund's
portfolio as of June 30, 1997 and is not indicative of holdings after that date.
A complete listing of securities in the Fund's portfolio as of June 30, 1997 is
provided in the Schedule of Investments later in this report.
SCHWAB NEW YORK MUNICIPAL MONEY FUND
PORTFOLIO COMPOSITION AS OF JUNE 30, 1997
[Pie Chart]
<TABLE>
<S> <C>
Variable Rate Obligations 66%
Revenue Bonds 7%
Mandatory Put Bonds 3%
Notes 16%
Other 2%
Tax-Exempt Commercial Paper 6%
</TABLE>
9
<PAGE> 16
THE PORTFOLIO MANAGEMENT TEAM
STEPHEN B. WARD - Senior Vice President and Chief Investment Officer, has
overall responsibility for management of the Funds' portfolios. Steve joined
Charles Schwab Investment Management (CSIM) as Vice President and Portfolio
Manager in April 1991 and was promoted to his current position in August 1993.
Prior to joining CSIM, Steve was Vice President and Portfolio Manager at
Federated Investors.
WALTER BEVERIDGE - Portfolio Manager, has managed Schwab Municipal Money Fund
and Schwab California Municipal Money Fund since 1992, when he joined Schwab,
and Schwab New York Municipal Money Fund since 1995. Prior to joining CSIM,
Walter was Portfolio Manager for the Benham Group.
JACK GAZZOLA - Associate Portfolio Manager, has day-to-day portfolio management
responsibilities for Schwab California Municipal Money Fund. Jack joined CSIM as
a trader in 1992 and was promoted to his current position in August 1996. Prior
to joining CSIM, Jack was an oil futures trader at Lehman Brothers at Phibro
Energy.
The following Market Overview and answers to questions are provided by the
Portfolio Management Team. A Glossary of Terms is provided for your reference on
page 19.
10
<PAGE> 17
MARKET OVERVIEW
[BAR CHART]
REAL GDP GROWTH RATE
-----------------------------------------
Q1-90 0.041%
Q2-90 0.013%
Q3-90 -0.019%
Q4-90 -0.041%
Q1-91 -0.022%
Q2-91 0.017%
Q3-91 0.01%
Q4-91 0.01%
Q1-92 0.047%
Q2-92 0.025%
Q3-92 0.03%
Q4-92 0.043%
Q1-93 -0.001%
Q2-93 0.019%
Q3-93 0.023%
Q4-93 0.048%
Q1-94 0.025%
Q2-94 0.049%
Q3-94 0.035%
Q4-94 0.03%
Q1-95 0.004%
Q2-95 0.007%
Q3-95 0.038%
Q4-95 0.003%
Q1-96 0.02%
Q2-96 0.047%
Q3-96 0.021%
Q4-96 0.038%
Q1-97 0.049%
Q2-97 0.022%
Source: Bloomberg L.P.
- - The economy, as measured by the growth of real GDP, continues to expand
at a healthy rate. The real GDP growth rate was 3.6% for the first six
months of 1997.
- - The apparent strength of the economy continues to lead to speculation
regarding the potential impact on future inflation and whether more
restrictive Federal Reserve policy is imminent.
- - At the time of this writing, the economy appears poised for growth,
continuing the current economic expansion which began in 1991.
11
<PAGE> 18
U.S. UNEMPLOYMENT RATE
[LINE GRAPH]
Jan-90 0.053%
Feb-90 0.053%
Mar-90 0.052%
Apr-90 0.054%
May-90 0.053%
Jun-90 0.051%
Jul-90 0.054%
Aug-90 0.056%
Sep-90 0.057%
Oct-90 0.058%
Nov-90 0.06%
Dec-90 0.062%
Jan-91 0.063%
Feb-91 0.065%
Mar-91 0.068%
Apr-91 0.066%
May-91 0.068%
Jun-91 0.068%
Jul-91 0.067%
Aug-91 0.068%
Sep-91 0.068%
Oct-91 0.069%
Nov-91 0.069%
Dec-91 0.071%
Jan-92 0.071%
Feb-92 0.073%
Mar-92 0.073%
Apr-92 0.073%
May-92 0.074%
Jun-92 0.077%
Jul-92 0.076%
Aug-92 0.076%
Sep-92 0.075%
Oct-92 0.074%
Nov-92 0.073%
Dec-92 0.073%
Jan-93 0.071%
Feb-93 0.07%
Mar-93 0.07%
Apr-93 0.07%
May-93 0.069%
Jun-93 0.069%
Jul-93 0.068%
Aug-93 0.067%
Sep-93 0.067%
Oct-93 0.067%
Nov-93 0.065%
Dec-93 0.064%
Jan-94 0.067%
Feb-94 0.066%
Mar-94 0.065%
Apr-94 0.064%
May-94 0.06%
Jun-94 0.06%
Jul-94 0.061%
Aug-94 0.061%
Sep-94 0.059%
Oct-94 0.056%
Nov-94 0.056%
Dec-94 0.054%
Jan-95 0.056%
Feb-95 0.054%
Mar-95 0.058%
Apr-95 0.057%
May-95 0.057%
Jun-95 0.056%
Jul-95 0.057%
Aug-95 0.053%
Sep-95 0.056%
Oct-95 0.055%
Nov-95 0.056%
Dec-95 0.056%
Jan-96 0.058%
Feb-96 0.055%
Mar-96 0.056%
Apr-96 0.054%
May-96 0.056%
Jun-96 0.053%
Jul-96 0.054%
Aug-96 0.051%
Sep-96 0.052%
Oct-96 0.052%
Nov-96 0.053%
Dec-96 0.053%
Jan-97 0.054%
Feb-97 0.053%
Mar-97 0.052%
Apr-97 0.049%
May-97 0.048%
Jun-97 0.05%
Source: Bloomberg L.P.
- - The unemployment rate during 1996 remained near its lowest point in the
decade. This declining trend continued into 1997, with the May 1997
rate of 4.8% representing the lowest rate since December 1973. Low
unemployment rates typically lead many economists to question whether
continued low levels of unemployment can persist without generating
inflationary pressures on wages and, ultimately, prices.
12
<PAGE> 19
MEASURES OF INFLATION
Source: Bloomberg L.P.
[BAR CHART]
QUARTERLY EMPLOYMENT COST INDEX MONTHLY CONSUMER PRICE INDEX
- ------------------------------- -----------------------------
Jan-90 0.053 Jan-90 0.052
Feb-90 0.053 Feb-90 0.053
Mar-90 0.053 Mar-90 0.052
Apr-90 0.054 Apr-90 0.047
May-90 0.054 May-90 0.044
Jun-90 0.054 Jun-90 0.047
Jul-90 0.051 Jul-90 0.048
Aug-90 0.051 Aug-90 0.056
Sep-90 0.051 Sep-90 0.062
Oct-90 0.048 Oct-90 0.063
Nov-90 0.048 Nov-90 0.063
Dec-90 0.048 Dec-90 0.061
Jan-91 0.046 Jan-91 0.057
Feb-91 0.046 Feb-91 0.053
Mar-91 0.046 Mar-91 0.049
Apr-91 0.045 Apr-91 0.049
May-91 0.045 May-91 0.05
Jun-91 0.045 Jun-91 0.047
Jul-91 0.043 Jul-91 0.044
Aug-91 0.043 Aug-91 0.038
Sep-91 0.043 Sep-91 0.034
Oct-91 0.042 Oct-91 0.029
Nov-91 0.042 Nov-91 0.03
Dec-91 0.042 Dec-91 0.031
Jan-92 0.041 Jan-92 0.026
Feb-92 0.041 Feb-92 0.028
Mar-92 0.041 Mar-92 0.032
Apr-92 0.035 Apr-92 0.032
May-92 0.035 May-92 0.03
Jun-92 0.035 Jun-92 0.031
Jul-92 0.034 Jul-92 0.032
Aug-92 0.034 Aug-92 0.031
Sep-92 0.034 Sep-92 0.03
Oct-92 0.035 Oct-92 0.032
Nov-92 0.035 Nov-92 0.03
Dec-92 0.035 Dec-92 0.029
Jan-93 0.034 Jan-93 0.033
Feb-93 0.034 Feb-93 0.032
Mar-93 0.034 Mar-93 0.031
Apr-93 0.036 Apr-93 0.032
May-93 0.036 May-93 0.032
Jun-93 0.036 Jun-93 0.03
Jul-93 0.036 Jul-93 0.028
Aug-93 0.036 Aug-93 0.028
Sep-93 0.036 Sep-93 0.027
Oct-93 0.034 Oct-93 0.028
Nov-93 0.034 Nov-93 0.027
Dec-93 0.034 Dec-93 0.027
Jan-94 0.032 Jan-94 0.025
Feb-94 0.032 Feb-94 0.025
Mar-94 0.032 Mar-94 0.025
Apr-94 0.031 Apr-94 0.024
May-94 0.031 May-94 0.023
Jun-94 0.031 Jun-94 0.025
Jul-94 0.031 Jul-94 0.028
Aug-94 0.031 Aug-94 0.029
Sep-94 0.031 Sep-94 0.03
Oct-94 0.03 Oct-94 0.026
Nov-94 0.03 Nov-94 0.027
Dec-94 0.03 Dec-94 0.027
Jan-95 0.03 Jan-95 0.028
Feb-95 0.03 Feb-95 0.029
Mar-95 0.03 Mar-95 0.029
Apr-95 0.03 Apr-95 0.031
May-95 0.03 May-95 0.032
Jun-95 0.03 Jun-95 0.03
Jul-95 0.028 Jul-95 0.028
Aug-95 0.028 Aug-95 0.026
Sep-95 0.028 Sep-95 0.025
Oct-95 0.028 Oct-95 0.028
Nov-95 0.028 Nov-95 0.026
Dec-95 0.028 Dec-95 0.025
Jan-96 0.029 Jan-96 0.027
Feb-96 0.029 Feb-96 0.027
Mar-96 0.029 Mar-96 0.028
Apr-96 0.029 Apr-96 0.029
May-96 0.029 May-96 0.029
Jun-96 0.029 Jun-96 0.028
Jul-96 0.029 Jul-96 0.03
Aug-96 0.029 Aug-96 0.029
Sep-96 0.029 Sep-96 0.03
Oct-96 0.03 Oct-96 0.03
Nov-96 0.03 Nov-96 0.033
Dec-96 0.03 Dec-96 0.033
Jan-97 0.028 Jan-97 0.03
Feb-97 0.028 Feb-97 0.03
Mar-97 0.028 Mar-97 0.028
Apr-97 0.028 Apr-97 0.025
May-97 0.028 May-97 0.022
Jun-97 0.028 Jun-97 0.023
Source: Bloomberg L.P.
- - Both the Employment Cost Index and Consumer Price Index (CPI) continued to
remain in check throughout the first half of 1997, reflecting continued low
levels of inflation.
- - For the 12 months ended June 1997, the CPI rose 2.3%, the lowest rate since
February 1987. Its core rate (which excludes the more volatile food and
energy components) rose 2.4%, the lowest rate since 1965.
- - The Federal Reserve has indicated that the economy continues to remain in the
zone where inflation risks are on the upside and that it is poised to act
preemptively by raising interest rates if necessary. The Federal Reserve did
take action in March, increasing the Federal Funds Rate by 0.25% to 5.50%,
yet left rates unchanged at the recent July 1997 Federal Open Market
Committee meeting.
13
<PAGE> 20
YIELDS ON 90-DAY COMMERCIAL PAPER
AND 3-MONTH TREASURY BILLS
FOR THE PERIOD FROM 1/2-6/30/97
[LINE GRAPH]
<TABLE>
<CAPTION>
3-MONTH 90-DAY
TREASURY BILL COMMERCIAL PAPER
------------- ----------------
<S> <C> <C>
1/2/97 5.18% 5.47%
1/3/97 5.16% 5.46%
1/6/97 5.17% 5.45%
1/7/97 5.15% 5.45%
1/8/97 5.15% 5.45%
1/9/97 5.12% 5.44%
1/10/97 5.16% 5.48%
1/13/97 5.17% 5.50%
1/14/97 5.16% 5.48%
1/15/97 5.14% 5.46%
1/16/97 5.16% 5.45%
1/17/97 5.15% 5.44%
1/20/97 5.15% 5.44%
1/21/97 5.15% 5.45%
1/22/97 5.16% 5.44%
1/23/97 5.16% 5.44%
1/24/97 5.16% 5.44%
1/27/97 5.19% 5.45%
1/28/97 5.19% 5.45%
1/29/97 5.17% 5.45%
1/30/97 5.17% 5.45%
1/31/97 5.15% 5.45%
2/3/97 5.11% 5.44%
2/4/97 5.13% 5.44%
2/5/97 5.12% 5.43%
2/6/97 5.13% 5.42%
2/7/97 5.12% 5.40%
2/10/97 5.13% 5.40%
2/11/97 5.14% 5.40%
2/12/97 5.14% 5.40%
2/13/97 5.12% 5.39%
2/14/97 5.08% 5.38%
2/17/97 5.09% 5.38%
2/18/97 5.09% 5.38%
2/19/97 5.10% 5.38%
2/20/97 5.08% 5.37%
2/21/97 5.09% 5.37%
2/24/97 5.11% 5.37%
2/25/97 5.15% 5.37%
2/26/97 5.18% 5.39%
2/27/97 5.20% 5.44%
2/28/97 5.22% 5.45%
3/3/97 5.23% 5.43%
3/4/97 5.23% 5.46%
3/5/97 5.19% 5.46%
3/6/97 5.21% 5.46%
3/7/97 5.21% 5.48%
3/10/97 5.19% 5.41%
3/11/97 5.17% 5.45%
3/12/97 5.19% 5.46%
3/13/97 5.23% 5.47%
3/14/97 5.23% 5.48%
3/17/97 5.25% 5.50%
3/18/97 5.29% 5.52%
3/19/97 5.29% 5.53%
3/20/97 5.34% 5.57%
3/21/97 5.40% 5.65%
3/24/97 5.38% 5.66%
3/25/97 5.39% 5.68%
3/26/97 5.34% 5.70%
3/27/97 5.37% 5.71%
3/28/97 5.37% 5.75%
3/31/97 5.32% 5.77%
4/1/97 5.30% 5.72%
4/2/97 5.29% 5.71%
4/3/97 5.25% 5.70%
4/4/97 5.27% 5.70%
4/7/97 5.27% 5.70%
4/8/97 5.23% 5.69%
4/9/97 5.22% 5.69%
4/10/97 5.29% 5.68%
4/11/97 5.28% 5.70%
4/14/97 5.29% 5.73%
4/15/97 5.29% 5.71%
4/16/97 5.29% 5.71%
4/17/97 5.29% 5.70%
4/18/97 5.28% 5.70%
4/21/97 5.26% 5.70%
4/22/97 5.32% 5.70%
4/23/97 5.34% 5.70%
4/24/97 5.30% 5.70%
4/25/97 5.31% 5.72%
4/28/97 5.30% 5.74%
4/29/97 5.26% 5.72%
4/30/97 5.23% 5.72%
5/1/97 5.21% 5.71%
5/2/97 5.22% 5.70%
5/5/97 5.11% 5.70%
5/6/97 5.17% 5.69%
5/7/97 5.22% 5.70%
5/8/97 5.21% 5.71%
5/9/97 5.16% 5.69%
5/12/97 5.15% 5.69%
5/13/97 5.20% 5.69%
5/14/97 5.16% 5.69%
5/15/97 5.11% 5.70%
5/16/97 5.18% 5.70%
5/19/97 5.30% 5.72%
5/20/97 5.20% 5.77%
5/21/97 5.12% 5.69%
5/22/97 5.17% 5.67%
5/23/97 5.16% 5.66%
5/26/97 5.16% 5.66%
5/27/97 5.11% 5.66%
5/28/97 5.13% 5.67%
5/29/97 5.01% 5.67%
5/30/97 4.94% 5.68%
6/2/97 4.84% 5.68%
6/3/97 5.07% 5.67%
6/4/97 5.07% 5.67%
6/5/97 5.11% 5.67%
6/6/97 5.04% 5.69%
6/9/97 5.03% 5.68%
6/10/97 5.03% 5.67%
6/11/97 4.96% 5.67%
6/12/97 4.95% 5.66%
6/13/97 4.96% 5.64%
6/16/97 4.97% 5.64%
6/17/97 5.04% 5.64%
6/18/97 5.07% 5.64%
6/19/97 5.07% 5.64%
6/20/97 5.06% 5.64%
6/23/97 5.15% 5.63%
6/24/97 5.18% 5.63%
6/25/97 5.10% 5.63%
6/26/97 5.12% 5.63%
6/27/97 5.14% 5.63%
6/30/97 5.17% 5.63%
</TABLE>
Source: Bloomberg L.P.
- - Although short-term rates were relatively stable during the first quarter of
1997, the spread between commercial paper and U.S. Treasury bill yields
widened significantly during the second quarter. This widening, making
Treasury bill yields relatively less attractive than commercial paper yields,
was a result of the reduced U.S. Treasury bill supply, caused by unexpectedly
large April federal tax receipts, which led to lower government financing
needs. In other words, the spread widening was the result of supply and
demand conditions in the U.S. Treasury bill market, not the result of credit
concerns in the commercial paper market.
14
<PAGE> 21
90-DAY MUNICIPAL COMMERCIAL PAPER YIELDS
FOR THE PERIOD FROM 1/7-6/24/97
[LINE GRAPH]
- -----------------------------------------------------------------
Jan 7, 97 0.0325
Jan 14, 97 0.0345
Jan 21, 97 0.0345
Jan 28, 97 0.0355
Feb 4, 97 0.034
Feb 11, 97 0.0345
Feb 18, 97 0.0335
Feb 25, 97 0.034
Mar 4, 97 0.0335
Mar 11, 97 0.033
Mar 18, 97 0.034
Mar 25, 97 0.035
Apr 1, 97 0.0345
Apr 8, 97 0.0365
Apr 15, 97 0.036
Apr 22, 97 0.037
Apr 29, 97 0.037
May 6, 97 0.0365
May 13, 97 0.0375
May 20, 97 0.037
May 27, 97 0.037
Jun 3, 97 0.0365
Jun 10, 97 0.037
Jun 17, 97 0.0375
Jun 24, 97 0.037
Source: Lehman Brothers, Inc.
- - Short-term municipal commercial paper yields exhibited a pattern similar to
that of taxable commercial paper yields during the reporting period.
15
<PAGE> 22
QUESTIONS TO THE PORTFOLIO MANAGEMENT TEAM
Q. HOW HAS THE PORTFOLIO MANAGEMENT TEAM ADJUSTED EACH FUND'S PORTFOLIO TO
RESPOND TO CHANGES IN INTEREST RATES?
A. We managed the dollar-weighted average maturity (DWAM) for all three Funds'
portfolios to capitalize on the seasonal cycles typical of short-term municipal
securities markets. In anticipation of lower rates for demand notes issued in
early 1997, the portfolio managers extended the maturity toward the end of
December, allowing the Funds to lock in higher rates and to be insulated from
the lower rates typical of notes issued in January. Throughout much of the
reporting period, all three Funds maintained a DWAM which was comparable to
those of other funds with similar investment objectives.
Prior to the close of the reporting period, we extended the DWAM for each of the
Funds for the following reasons:
1. Anticipation of a seasonal decline in yields on floating-rate instruments
during July;
2. A plentiful supply of municipal money market instruments at attractive rates
in June; and
3. Our expectation that the Federal Reserve would not raise the Federal Funds
Rate in July.
The table below shows the DWAM for each of the three Funds at the beginning,
middle, and end of the reporting period:
Schwab Schwab California Schwab New York
Municipal Municipal Municipal
Money Fund Money Fund Money Fund
- --------------------------------------------------------------------------------
12/31/96 50 days 47 days 51 days
- --------------------------------------------------------------------------------
3/31/97 37 days 31 days 50 days
- --------------------------------------------------------------------------------
6/30/97 64 days 53 days 52 days
- --------------------------------------------------------------------------------
16
<PAGE> 23
Q. WHAT IMPACT DID LAST YEAR'S PROXY VOTE HAVE ON THE INVESTMENT PROFILE AND
YIELDS OF THE FUNDS?
A. The proxy vote eliminated the previous restriction limiting AMT investments
in each Fund's portfolio to a maximum of 20% of total assets. (An AMT investment
is a security which generates interest income which is subject to the federal
alternative minimum tax.) As shown on the table below, the portfolio managers
have increased the percentage of each Fund's portfolio invested in AMT
investments:
<TABLE>
<CAPTION>
AMT Investments as a
% of total investments
- --------------------------------------------------------------------------------
12/31/96 6/30/97
- --------------------------------------------------------------------------------
<S> <C> <C>
Schwab Municipal Money Fund 19.1% 48.0%
- --------------------------------------------------------------------------------
Schwab California Municipal Money Fund 13.3% 26.7%
- --------------------------------------------------------------------------------
Schwab New York Municipal Money Fund 18.0% 37.0%
- --------------------------------------------------------------------------------
</TABLE>
We continue to add AMT investments to all three Funds' portfolios when market
conditions are advantageous to do so. Our ability to add AMT investments to the
Funds is largely a function of new issuance, which particularly in California,
has been insufficient to allow us to meet our long-term targeted levels. If
issuance trends and yield differentials between AMT and non-AMT investments
continue to be favorable, our goal would be to continue to increase the
percentage of AMT holdings in each Fund's portfolio.
In terms of yields, AMT investments typically offer greater yields than other
types of municipal securities with similar credit quality. As a result,
municipal and tax-free money market funds in the industry are increasingly
purchasing AMT investments. Eliminating the 20% limitation has given the
portfolio managers more flexibility to take advantage of the higher yields
offered by AMT investments and to allow the Funds to remain competitive. While
there can be no guarantee,
17
<PAGE> 24
we anticipate that over the long-term the Funds may be able to achieve higher
yields with this enhanced flexibility. Please bear in mind that although all
shareholders may benefit from potentially higher yields, shareholders subject to
federal AMT may find that a greater percentage of their income from each Fund is
subject to that tax.
Q. WHAT CREDIT STANDARDS DOES THE PORTFOLIO MANAGEMENT TEAM USE IN SELECTING
SECURITIES FOR THE FUNDS?
A. Money market funds are required by law to hold only high-quality securities
which meet certain maturity requirements in their portfolios. For the Schwab
Municipal Money Funds, we continue to take the additional step of investing only
in what are referred to as first-tier securities. In general, a first-tier
security carries the highest credit ratings.
Certain securities owned by the Schwab Municipal Money Funds are insured or are
backed by a letter of credit issued by first-tier financial institutions. These
arrangements are frequently referred to as "credit enhancements" because they
provide incremental levels of creditworthiness. As part of our regular credit
review process, we continually monitor the credit quality of both the
enhancement providers and the issuers of the Funds' portfolio securities.
18
<PAGE> 25
GLOSSARY OF TERMS
COMMERCIAL PAPER Short-term, interest-paying obligations with maturities ranging
up to 270 days issued by banks, corporations, and other borrowers.
CREDIT ENHANCEMENTS A bank letter of credit, purchase agreement, insurance, line
of credit, or other instrument that provides an additional level of financial
support for debt securities to supplement the creditworthiness of the issuer.
DOLLAR-WEIGHTED AVERAGE MATURITY (DWAM) A measure of the average maturity of a
mutual fund's entire portfolio, weighted by the value of its individual
holdings.
FEDERAL FUNDS RATE A key interest rate charged by banks when lending money to
other banks overnight.
FEDERAL RESERVE The central bank of the United States that establishes policies
on bank reserves and regulations, determines the discount rate, and tightens or
loosens the availability of credit.
FIRST-TIER SECURITY A security rated in the highest short-term credit rating
category.
MATURITY The length of time before which the issuer of a debt security must
repay the principal amount.
REAL GDP The national Gross Domestic Product (GDP) -- the total value of all
goods and services produced in the U.S. over a specific period of time and
adjusted for the rate of inflation to allow meaningful year-to-year comparisons.
YIELD The rate of return, usually dividend or interest payments, on an
investment, expressed as a percentage of market price.
FEDERAL ALTERNATIVE MINIMUM TAX (AMT) A federal tax on income in addition to
regular income taxes designed to ensure that very wealthy individuals and
corporations pay at least some income tax each year.
TAXABLE EQUIVALENT YIELD The return you would have to realize on a fully taxable
investment in order to equal a specified tax-exempt yield; this hypothetical
yield varies according to your income tax bracket.
19
<PAGE> 26
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
PORTFOLIO SUMMARY
ASSET GROWTH
<TABLE>
<CAPTION>
Total Total Percentage
Net Assets Net Assets Growth Over
as of 6/30/97 as of 12/31/96 Reporting
(000s) (000s) Period
- ------------------------------------------------
<S> <C> <C>
$ 4,698,475 $4,476,999 5%
- ------------------------------------------------
</TABLE>
AVERAGE YIELDS FOR THE PERIODS ENDED JUNE 30, 1997*
SWEEP SHARES
<TABLE>
<CAPTION>
Last
Last Last Twelve
Seven Days Three Months Months
- ------------------------------------------------
<S> <C> <C>
3.44% 3.27% 2.95%
- ------------------------------------------------
</TABLE>
VALUE ADVANTAGE SHARES
<TABLE>
<CAPTION>
Last
Last Last Twelve
Seven Days Three Months Months
- ------------------------------------------------
<S> <C> <C>
3.65% 3.48% 3.16%
- ------------------------------------------------
</TABLE>
MATURITY SCHEDULE
PERCENT OF TOTAL INVESTMENTS
<TABLE>
<CAPTION>
Maturity Range 9/30/96 12/31/96 3/31/97 6/30/97
- ----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
0 - 15 Day s 72.2% 67.7% 71.5% 68.5%
16 - 30 Days 4.4 1.1 2.0 3.5
31 - 60 Days 3.1 6.9 9.7 4.0
61 - 90 Days 2.9 2.4 3.7 5.3
91 - 120 Days 0.3 1.2 3.6 0.2
Over 120 Days 17.1 20.7 9.5 18.5
Weighted Average 53 Days 50 Days 37 Days 64 Days
- ----------------------------------------------------------------------
</TABLE>
- ---------------
* A portion of the Fund's expenses were reduced during the periods. Had these
expenses not been reduced, yields would have been lower.
20
<PAGE> 27
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
PORTFOLIO SUMMARY
ASSET GROWTH
<TABLE>
<CAPTION>
Total Total Percentage
Net Assets Net Assets Growth Over
as of 6/30/97 as of 12/31/96 Reporting
(000s) (000s) Period
- ------------------------------------------------
<S> <C> <C>
$ 2,610,025 $2,323,598 12%
- ------------------------------------------------
</TABLE>
AVERAGE YIELDS FOR THE PERIODS ENDED JUNE 30, 1997*
SWEEP SHARES
<TABLE>
<CAPTION>
Last
Last Last Twelve
Seven Days Three Months Months
- ------------------------------------------------
<S> <C> <C>
3.28% 3.12% 2.83%
- ------------------------------------------------
</TABLE>
VALUE ADVANTAGE SHARES
<TABLE>
<CAPTION>
Last
Last Last Twelve
Seven Days Three Months Months
- ------------------------------------------------
<S> <C> <C>
3.48% 3.32% 3.03%
- ------------------------------------------------
</TABLE>
MATURITY SCHEDULE
PERCENT OF TOTAL INVESTMENTS
<TABLE>
<CAPTION>
Maturity Range 9/30/96 12/31/96 3/31/97 6/30/97
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
0 - 15 Days 74.6% 66.8% 74.2% 69.7%
16 - 30 Days 1.3 3.9 0.0 1.9
31 - 60 Days 6.8 8.1 7.0 9.8
61 - 90 Days 0.1 4.2 5.0 5.5
91 - 120 Days 0.0 0.2 7.3 1.0
Over 120 Days 17.2 16.8 6.5 12.1
Weighted Average 56 Days 47 Days 31 Days 53 Days
- ---------------------------------------------------------------------
</TABLE>
- ---------------
* A portion of the Fund's expenses were reduced during the periods. Had these
expenses not been reduced, yields would have been lower.
21
<PAGE> 28
SCHWAB NEW YORK MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
PORTFOLIO SUMMARY
ASSET GROWTH
<TABLE>
<CAPTION>
Total Total Percentage
Net Assets Net Assets Growth Over
as of 6/30/97 as of 12/31/96 Reporting
(000s) (000s) Period
- ------------------------------------------------
<S> <C> <C>
$ 405,625 $337,295 20%
- ------------------------------------------------
</TABLE>
AVERAGE YIELDS FOR THE PERIODS ENDED JUNE 30, 1997*
SWEEP SHARES
<TABLE>
<CAPTION>
Last
Last Last Twelve
Seven Days Three Months Months
- ------------------------------------------------
<S> <C> <C>
3.31% 3.12% 2.79%
- ------------------------------------------------
</TABLE>
VALUE ADVANTAGE SHARES
<TABLE>
<CAPTION>
Last
Last Last Twelve
Seven Days Three Months Months
- ------------------------------------------------
<S> <C> <C>
3.55% 3.36% 3.03%
- ------------------------------------------------
</TABLE>
MATURITY SCHEDULE
PERCENT OF TOTAL INVESTMENTS
<TABLE>
<CAPTION>
Maturity Range 9/30/96 12/31/96 3/31/97 6/30/97
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
0 - 15 Days 74.1% 71.2% 63.8% 69.9%
16 - 30 Days 2.9 0.0 2.7 1.5
31 - 60 Days 1.7 6.9 6.5 6.6
61 - 90 Days 0.6 0.0 4.9 1.2
91 - 120 Days 0.0 3.0 6.7 2.0
Over 120 Days 20.7 18.9 15.4 18.8
Weighted Average 55 Days 51 Days 50 Days 52 Days
- ---------------------------------------------------------------------
</TABLE>
- ---------------
* A portion of the Fund's expenses were reduced during the periods. Had these
expenses not been reduced, yields would have been lower.
22
<PAGE> 29
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
VARIABLE RATE OBLIGATIONS--63.8%(a)
ALABAMA--1.4%
Birmingham, Alabama Unlimited General Obligation
Refunding Bonds Series 1995/(First Alabama
Bank LOC)
4.15%, 07/01/97 $ 4,000 $ 4,000
Citronelle, Alabama Industrial Development Board
Pollution Control Revenue Refunding Bonds
(AKZO Chemicals, Inc. Project)/(Wachovia Bank
LOC)
4.20%, 07/07/97 1,100 1,100
Decatur, Alabama Industrial Development Board
Solid Waste Disposal Revenue Bonds (Trico
Steel Project) Series 1997/(Chase Manhattan
LOC)
4.30%, 07/07/97 5,700 5,700
Fort Payne, Alabama Industrial Development Base
Tax Exempt Adjustable Mode Industrial
Development Revenue Bonds (Charleston Hosiery
Project) Series 1997/(Wachovia Bank LOC)
4.30%, 07/07/97 2,000 2,000
McIntoch, Alabama Industrial Development Board
Solid Waste Bonds (Ciba-Geigy Corp.
Project)/(Union Bank of Switzerland LOC)
4.25%, 07/07/97 24,500 24,500
Mobile County, Alabama Industrial Development
Board Pollution Control Revenue Refunding
Bonds (Ultraform Co. Project) Series
1995A/(Bayerische Landesbank Girozentrale LOC)
4.13%, 07/07/97 7,480 7,480
Mobile County, Alabama Industrial Development
Board Revenue Bonds (Ultraform Co. Project)
Series B/(Bayerische Landesbank Girozentrale
LOC)
4.13%, 07/07/97 1,000 1,000
Mobile, Alabama Industrial Development Board
Pollution Control Revenue Bonds (Alabama Power
Co. Project) Series 1993C
4.18%, 07/07/97 12,000 12,000
Montgomery, Alabama Special Care Facility
Financing Authority Revenue Bonds (Baptist
Medical Center VHA) Series 1985C/(AMBAC
Insurance & FNB Chicago SBPA)
4.20%, 07/07/97 2,000 2,000
</TABLE>
23
<PAGE> 30
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Montgomery, Alabama Special Care Facility
Financing Authority Revenue Bonds (Baptist
Medical Center VHA) Series 1985H/(AMBAC
Insurance & FNB Chicago SBPA)
4.20%, 07/07/97 $ 5,295 $ 5,295
Opelika, Alabama Industrial Development Board
Revenue Bonds (Power Guard Project) Series
1994/(SouthTrust Bank of Alabama LOC)
4.48%, 07/07/97 2,595 2,595
----------
67,670
----------
ALASKA--0.3%
Alaska Industrial Development & Export Authority
(Revolving Fund) Series 1996B/(Bank of America
LOC)
4.25%, 07/07/97 12,600 12,600
----------
ARIZONA--1.5%
Arizona Educational Loan Marketing Corp.
Education Loan Revenue Bonds Series A/(MBIA
Insurance & State Street Bank & Trust SBPA)
4.25%, 07/07/97 12,505 12,505
Arizona Health Facilities Authority Hospital
System Revenue (Northern Arizona Health Care)
Series 1996B/(MBIA Insurance)
4.20%, 07/07/97 12,050 12,050
Arizona Health Facilities Authority Revenue
Adjustable Rate Notes (Arizona Volunteer
Hospital Federation) Series 1985A/(FGIC
Insurance)
4.20%, 07/07/97 2,945 2,945
Arizona Health Facilities Authority Revenue
Adjustable Rate Notes (Arizona Volunteer
Hospital Federation) Series 1985B/(FGIC
Insurance)
4.20%, 07/07/97 7,840 7,840
Arizona Health Facilities Revenue Bonds (Samcor
Project) 1986 Loan Pool/(FGIC Insurance &
Chase Manhattan SPA)
4.20%, 07/07/97 12,140 12,140
Phoenix, Arizona Civic Improvement Excise Tax
Revenue Bonds (Airport Improvements)/(Landesbank
Hessen-Thuringen Girozentrale LOC)
4.25%, 07/07/97 1,000 1,000
Phoenix, Arizona Industrial Development
Authority Multi-Family Housing Revenue Bonds
(Crossroads Apartments) Series 97A/(FNMA LOC)
4.25%, 07/07/97 6,000 6,000
</TABLE>
24
<PAGE> 31
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Pima County, Arizona Industrial Development
Authority Multi-Family Housing Revenue Bonds
(Housing Surgauro Crest Apartments) Series
1995A/(FNMA LOC)
4.25%, 07/07/97 $ 6,000 $ 6,000
Pima County, Arizona Industrial Development
Authority Revenue Bonds (Tucson Electric Power
Company General Projects)/(Bank of America
LOC)
4.20%, 07/07/97 4,000 4,000
Yavapai County, Arizona Industrial Development
Authority Revenue Bonds (First Health Care
Corp. Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 4,230 4,230
Yuma, Arizona Industrial Development Authority
Multi-Family Housing Revenue Bonds (El Encanto
Apartments) Series A/(Citibank LOC)
4.20%, 07/07/97 2,915 2,915
----------
71,625
----------
ARKANSAS--0.6%
Independence County, Arkansas Industrial
Development Revenue Bonds (Townsends of
Arkansas, Inc. Project)/(Rabobank Nederland
N.V. SPA)
4.20%, 07/07/97 4,000 4,000
Little River County, Arkansas Solid Waste
Disposal Revenue Bonds (Georgia Pacific
Project)/(Sumitomo Bank LOC)
4.35%, 07/07/97 15,500 15,500
North Little Rock, Arkansas Health Facilities
Board Revenue Bonds (Baptist Health) Series
1996B/(MBIA Insurance & Credit Suisse SPA)
4.13%, 07/07/97 10,000 10,000
Warren Park, Arkansas Solid Waste Disposal
Revenue Bonds (Potlatch Corp. Project)/(Credit
Suisse LOC)
4.20%, 07/07/97 1,000 1,000
----------
30,500
----------
CALIFORNIA--1.4%
California Higher Education Loan Authority
Student Loan Refunding Bonds Series E1/(SLMA
LOC)
4.25%, 07/07/97 5,000 5,000
California Pollution Control Financing Authority
(OMS Equity of Stanislaus)/(Swiss Bank LOC)
3.85%, 07/01/97 1,200 1,200
California Pollution Control Financing Authority
Revenue Bonds (Southern California Edison)
Series 1986A
5.20%, 07/01/97 3,700 3,700
</TABLE>
25
<PAGE> 32
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Pollution Control Financing Authority
Revenue Bonds (Southern California Edison)
Series 1986C
5.20%, 07/01/97 $ 4,500 $ 4,500
California Statewide Community Development
Authority Revenue Bonds Certificates of
Participation (Sutter Health Obligations
Group)/(AMBAC Insurance & Industrial Bank of
Japan SBPA)
3.75%, 07/01/97 28,500 28,500
Foothill, California Eastern Transportation
Corridor Agency Toll Road Revenue Bonds Series
1995D/(Industrial Bank of Japan LOC)
4.10%, 07/07/97 2,200 2,200
Irvine Ranch Water District Consolidated Revenue
Refunding Bonds (Districts 102, 103, 105 &
106)/(Commerzbank AG LOC)
3.75%, 07/01/97 3,800 3,800
Irvine Ranch Water District Consolidated Revenue
Refunding Bonds (Districts 105, 250 & 290)
Series 1991/(National Westminster Bank PLC
LOC)
3.75%, 07/01/97 3,280 3,280
Irvine Ranch, California Water District
Consolidated Revenue Refunding Bonds (Various
Improvement District Number 182) Series
A/(Sumitomo Bank LOC)
3.80%, 07/01/97 5,450 5,450
Irvine Ranch, California Water District
Consolidated Revenue Refunding Bonds Series
1993A/(Bank of America LOC)
3.80%, 07/01/97 4,000 4,000
Orange County, California Sanitation District
Certificates of Participation Series
1990-92A/(National Westminster Bank PLC LOC)
3.75%, 07/01/97 2,100 2,100
Orange County, California Water District
Improvement Bond Act 1915 Revenue Bonds
(Irvine Coast Assessment District)Number
88-1/(Kredietbank, N.V. & Societe Generale
LOC)
3.90%, 07/01/97 6,000 6,000
----------
69,730
----------
COLORADO--5.1%
Central City, Colorado Multi-Family Housing
Revenue Bonds (Gold Mountain Apartment
Project)/(PNC Bank N.A. LOC)
4.40%, 07/07/97 8,250 8,250
Colorado Student Obligation Bond Authority
Student Loan Revenue Bonds (Colorado
University) Series 1989A/(SLMA LOC)
4.25%, 07/07/97 20,300 20,300
</TABLE>
26
<PAGE> 33
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Colorado Student Obligation Bond Authority
Student Loan Revenue Bonds (Colorado
University) Series 1990A/(SLMA LOC)
4.25%, 07/07/97 $ 45,555 $ 45,555
Colorado Student Obligation Bond Authority
Student Loan Revenue Bonds (Colorado
University) Series 1993B/(SLMA LOC)
4.25%, 07/07/97 10,100 10,100
Denver, Colorado City & County Airport Revenue
Bonds Series 1997C/(Toronto-Dominion Bank LOC)
4.25%, 07/07/97 33,000 33,000
Denver, Colorado City & County Airport System
Revenue Bonds Series 1992D/(Morgan Guaranty
Trust Co. -- New York LOC)
4.40%, 07/07/97 48,900 48,900
Denver, Colorado City & County Airport System
Revenue Bonds Series 1992E/(Bank of Tokyo-
Mitsubishi Ltd. LOC)
4.50%, 07/07/97 30,000 30,000
Denver, Colorado City & County Airport System
Revenue Bonds Series 1992F/(Bank of Montreal
LOC)
4.40%, 07/07/97 16,000 16,000
Denver, Colorado City & County Airport System
Revenue Bonds Series 1992G/(Credit Local De
France LOC)
4.40%, 07/07/97 20,000 20,000
El Paso County, Colorado Adjustable Rate Revenue
Bonds (Colorado Springs World Arena)/(Bank One
LOC)
4.20%, 07/03/97 15,000 15,000
Smith Creek, Colorado Metropolitan District
Revenue Bonds Series 1997/(Nationsbank of
Texas N.A. LOC)
4.20%, 07/03/97 2,250 2,250
----------
249,355
----------
CONNECTICUT--0.5%
Connecticut Development Authority Pollution
Control Revenue Bonds Connecticut Light &
Power Series 1985/(AMBAC Insurance & Societe
Generale LOC)
4.10%, 07/07/97 16,200 16,200
Connecticut Development Authority Pollution
Control Revenue Bonds Connecticut Light And
Power Series 1993B/(Union Bank of Switzerland
LOC)
4.10%, 07/07/97 6,900 6,900
----------
23,100
----------
</TABLE>
27
<PAGE> 34
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
DISTRICT OF COLUMBIA--0.1%
District of Columbia Revenue Bonds Adjustable
Convertible Extendable Securities (Georgetown
University) Series 1988D/(Bayerische
Landesbank Girozentrale LOC)
4.15%, 07/07/97 $ 4,200 $ 4,200
----------
FLORIDA--1.0%
Dade County, Florida Industrial Development
Authority Revenue Bonds Series 1997
(Michael-Ann Russell Jewish Community Center
Project)/(Suntrust Bank N.A. LOC)
4.20%, 07/07/97 4,000 4,000
Florida Housing Finance Agency Housing Revenue
Bonds (Ashley Lake Park II) Series 1989J/
(Barclays Bank PLC LOC)
4.20%, 07/07/97 6,000 6,000
Florida Housing Finance Agency Variable Rate
Housing Revenue Bonds (Tiffany Club Project)
Series 1996P/(Nationsbank LOC)
4.30%, 07/07/97 2,875 2,875
Manatee County, Florida Industrial Development
Revenue Bonds Series 1997A (Trielectron
Industries Project)/(First Union Bank of
North Carolina LOC)
4.35%, 07/07/97 2,000 2,000
Orange County, Florida Housing Finance Authority
Multi-Family Housing Revenue Bonds (Rio Vista
Project)/(First Union Bank of North Carolina
LOC)
4.20%, 07/07/97 3,815 3,815
Palm Beach County, Florida Health Facilities
Authority Revenue Refunding Bonds (Joseph L.
Morse Geriatric Center)/(Sun Bank LOC)
4.15%, 07/07/97 12,355 12,355
Palm Beach County, Florida Housing Finance
Authority Multi-Family Housing Revenue Bonds
(Crystal II Project)/(Citibank LOC)
4.30%, 07/07/97 1,800 1,800
Pasco County, Florida School Board Certificates
of Participation/(AMBAC Insurance & Bayerische
Landesbank Girozentrale SPA)
4.15%, 07/03/97 18,500 18,500
----------
51,345
----------
GEORGIA--3.2%
Athens, Clarke, Jackson & Morgan Counties,
Georgia Industrial Development Bonds (Mayfield
Dairy)/(Wachovia Bank LOC)
4.30%, 07/07/97 4,500 4,500
</TABLE>
28
<PAGE> 35
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Cherokee County, Georgia Development Authority
Revenue Industrial Development (Universal
Alloy)/(Wachovia Bank LOC)
4.30%, 07/07/97 $ 5,500 $ 5,500
Cobb County, Georgia Housing Finance Authority
Multi-Family Housing Revenue Bonds (Walton
Green Project)/(Wachovia Bank LOC)
4.30%, 07/07/97 14,000 14,000
Cobb County, Georgia Housing Finance Authority
Multi-Family Housing Revenue Bonds
(Williamstown Apartment Project)/(Wachovia
Bank LOC)
4.30%, 07/07/97 2,000 2,000
Dekalb County, Georgia Development Authority
Industrial Development Revenue Bonds (Park
North Business Center Project)/(Wachovia Bank
LOC)
4.20%, 07/07/97 5,140 5,140
Dekalb County, Georgia Development Authority
Industrial Development Revenue Bonds (Siemens
Energy, Inc. Project)/(Siemens AG Guaranty)
4.25%, 07/07/97 3,750 3,750
Dekalb County, Georgia Development Authority
Industrial Development Revenue Bonds (Truman
Properties Ltd. Liability Corp.
Project)/(Wachovia Bank LOC)
4.30%, 07/07/97 3,000 3,000
Dekalb County, Georgia Development Authority
Revenue Bonds (American Cancer Society)/
(Trust Company Bank LOC)
4.20%, 07/07/97 1,875 1,875
Dekalb County, Georgia Housing Authority
Multi-Family Housing Revenue Bonds (Wood Hills
Apartment Project)/(Bank of Montreal LOC)
4.20%, 07/07/97 5,250 5,250
Dekalb County, Georgia Private Hospital
Authority Revenue Bonds (Egleston Childs
Hospital/Emory University) Series 1994A &
B4/(Suntrust Bank LOC)
4.20%, 07/07/97 7,000 7,000
Douglas County, Georgia Development Authority
Industrial Development Revenue Refunding Bonds
(Mima, Inc. Project)/(Wachovia Bank LOC)
4.25%, 07/07/97 4,300 4,300
Fayette County, Georgia Industrial Development
Revenue Bonds (Norman W. Paschell Company
Project)/(Suntrust Bank Atlanta LOC)
4.35%, 07/07/97 1,200 1,200
</TABLE>
29
<PAGE> 36
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Fulton County, Georgia Development Authority
Revenue Adjusting Bonds (Woodruff Arts
Center)/(Wachovia Bank LOC)
4.20%, 07/07/97 $ 22,500 $ 22,500
Jefferson County, Georgia Development Authority
Industrial Development Revenue Bonds (Grove
River Mills) Series 1997/(Wachovia Bank LOC)
4.30%, 07/07/97 3,500 3,500
Laurens County, Georgia Development Authority
Solid Waste Disposal Revenue Bonds (Southeast
Paper Co. Project)/(Wachovia Bank LOC)
4.30%, 07/07/97 25,000 24,998
Richmond County, Georgia Industrial Development
Authority Revenue Bonds (BOK Group Project)/
(Wachovia Bank LOC)
4.20%, 07/07/97 5,000 5,000
Rockmart, Georgia Development Authority
Industrial Development Revenue Bonds (CW
Matthews Contracting)/(Wachovia Bank LOC)
4.30%, 07/07/97 1,000 1,000
Roswell, Georgia Housing Authority Multi-Family
Housing Revenue Bonds (Gables Realty Wood
Crossing Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 11,650 11,650
Savannah, Georgia Economic Development Authority
Revenue (Home Depot Project) Series
1995B/(Trust Company Bank LOC)
4.25%, 07/07/97 5,000 5,000
Smyrna, Georgia Housing Authority Multi-Family
Housing Revenue Bonds (Walton Park LP)/
(Wachovia Bank LOC)
4.30%, 07/07/97 8,000 8,000
Smyrna, Georgia Housing Authority Multi-Family
Housing Revenue Bonds (Walton Park Phase 2
Project)/(Wachovia Bank LOC)
4.30%, 07/07/97 13,500 13,500
Villa Rica, Georgia Industrial Development
Revenue Bonds (Lowes Home Centers, Inc.
Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 800 800
Worth County, Georgia Industrial Development
Authority Revenue Refunding Bonds (Seabrook
Project) Series 1996B/(SunBank LOC)
4.30%, 07/07/97 1,400 1,400
----------
154,863
----------
</TABLE>
30
<PAGE> 37
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
HAWAII--1.0%
Hawaii Department of Budget & Finance Special
Purpose Mortgage Revenue Bonds (Adventist
Health System West)/(Union Bank of California
LOC)
4.20%, 07/07/97 $ 3,100 $ 3,100
Hawaii State Housing Finance & Development Corp.
Multi-Family Housing Revenue Bonds (Nani Mauna
Loa Project) Series 1995A/(Citibank LOC)
5.00%, 07/07/97 3,900 3,900
Hawaii State Housing Finance & Development Corp.
Revenue Bonds (Rental Housing System) Series
1990B/(Industrial Bank of Japan LOC)
4.30%, 07/07/97 19,400 19,400
Hawaii Student Loan Revenue Bonds (Secondary
Market Services Corp.) Series
1995-II/(National Westminster Bank LOC)
4.25%, 07/07/97 8,100 8,100
Honolulu, Hawaii City & County Multi-Family
Housing Revenue Bonds (HaleKua Gardens
Project) Series A/(Bank of Tokyo-Mitsubishi
Ltd. LOC)
4.30%, 07/07/97 5,120 5,120
Honolulu, Hawaii City & County Multi-Family
Housing Revenue Bonds (Iolani Regents Project)
Series 1990A/(Bank of Hawaii LOC)
4.35%, 07/07/97 9,150 9,150
----------
48,770
----------
ILLINOIS--7.7%
Aurora, Kane, & Dupage Counties, Illinois
Industrial Development Revenue Bonds (North
American Plastics Corporation)/(First of
America Bank Illinois N.A. LOC)
4.40%, 07/07/97 5,400 5,400
Bartlett, Illinois Multi-Family Housing Revenue
Bonds (Bartlett Square Apartments) Series
1995A/(LaSalle National Bank LOC)
4.20%, 07/07/97 2,100 2,100
Batavia, Illinois Development Revenue Bonds
(American Industrial Technologies)/(Northern
Trust LOC)
4.45%, 07/07/97 2,200 2,200
Carol Stream, Illinois Multi-Family Housing
Revenue Refunding Bonds (St. Charles
Square)/(FNMA LOC)
4.25%, 07/07/97 4,415 4,415
Centralia, Illinois Industrial Development
Authority Revenue Bonds (Consolidated Foods
Corp./Hollywood Brands, Inc.
Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 4,500 4,500
</TABLE>
31
<PAGE> 38
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Chicago, Illinois Industrial Development Revenue
Bonds (Morse Automotive) Series 1995/(American
National Bank & Trust Co. LOC)
4.39%, 07/07/97 $ 2,800 $ 2,800
Chicago, Illinois O'Hare International Airport
Revenue Bonds (Adjustable Convertible
Extendable Securities General Airport Second
Lien) Series B-1/(Bayerische Landesbank
Girozentrale LOC)
4.20%, 07/07/97 26,100 26,100
Chicago, Illinois O'Hare International Airport
Revenue Bonds (Adjustable Convertible
Extendable Securities General Airport Second
Lien) Series B-2/(Bayerische Landesbank
Girozentrale LOC)
4.20%, 07/07/97 9,600 9,600
Chicago, Illinois O'Hare International Airport
Revenue Bonds (General Airport Second Lien)
Series 1994C/(Societe Generale Bank LOC)
4.20%, 07/07/97 11,900 11,900
Illinois Development Authority Industrial
Development Bonds (Camcraft, Inc.
Project)/(American National Bank & Trust Co.
LOC)
4.35%, 07/07/97 1,000 1,000
Illinois Development Authority Revenue Bonds
(Cloverhill Pastry)/(American National Bank &
Trust Co. LOC)
4.35%, 07/07/97 6,450 6,450
Illinois Development Finance Authority (Catholic
Charities)/(Allied Irish Banks PLC LOC)
4.20%, 07/07/97 2,655 2,655
Illinois Development Finance Authority
Adjustable Rate Bonds (Profile Plastics
Project) Series 1994/(American National Bank &
Trust Co. LOC)
4.35%, 07/07/97 2,785 2,785
Illinois Development Finance Authority Hospital
Revenue Bonds (Palos Community Hospital)
Series 1994-1/(Credit Suisse LOC)
4.13%, 07/07/97 33,700 33,700
Illinois Development Finance Authority Hospital
Revenue Bonds (Palos Community Hospital)
Series 1994-2/(Credit Suisse LOC)
4.13%, 07/07/97 13,900 13,900
Illinois Development Finance Authority
Industrial Development Revenue Bonds (Chicago
Corrugated Box Company) Series 6/(American
National Bank & Trust Co. LOC)
4.39%, 07/07/97 1,350 1,350
</TABLE>
32
<PAGE> 39
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Illinois Development Finance Authority
Industrial Development Revenue Bonds (Knead
Dough Baking Co.)/(Bank of America LOC)
4.20%, 07/07/97 $ 7,925 $ 7,925
Illinois Development Finance Authority
Industrial Development Revenue Bonds (Perkin
Paperboard Co. LP) Series 1994/(Northern Trust
LOC)
4.35%, 07/07/97 5,500 5,500
Illinois Development Finance Authority
Industrial Development Revenue Bonds (Plano
Molding Project)/(Northern Trust LOC)
4.35%, 07/07/97 1,100 1,100
Illinois Development Finance Authority
Industrial Development Revenue Bonds
(Presbyterian Home Lake) Series 1996A/(LaSalle
National Bank LOC)
4.15%, 07/07/97 39,000 39,000
Illinois Development Finance Authority
Industrial Development Revenue Bonds
(Radiological Society Project) Series
1997/(American National Bank & Trust Company
LOC)
4.31%, 07/07/97 4,900 4,900
Illinois Development Finance Authority
Industrial Development Revenue Bonds (River
Graphics Corp. Project) Series 1996/(American
National Bank & Trust Co. LOC)
4.39%, 07/07/97 3,200 3,200
Illinois Development Finance Authority
Industrial Development Revenue Bonds (SMF,
Inc. Project) Series A/(First of America LOC)
4.40%, 07/07/97 2,255 2,255
Illinois Development Finance Authority
Residential Rental Revenue Bonds (F.C. Harris
Pavillion Project) Series 1994/(FNMA
Collateral Investment Agreement)
4.25%, 07/07/97 27,510 27,510
Illinois Development Finance Authority
Residential Rental Revenue Bonds (River Oak
Project)/(Swiss Bank LOC)
4.30%, 07/07/97 32,000 32,000
Illinois Development Finance Authority Revenue
Bonds (Variable Rest Haven Illiana
Christian)/(FHLB LOC)
4.15%, 07/07/97 13,265 13,265
Illinois Development Finance Authority Revenue
Bonds (Village Oak Park Residence)/(First Star
Bank LOC)
4.25%, 07/07/97 2,260 2,260
Illinois Development Finance Authority Variable
Rate Revenue Bonds Chicago Academy of Science/
(American National Bank & Trust Co. LOC)
4.15%, 07/07/97 3,915 3,915
</TABLE>
33
<PAGE> 40
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Illinois Educational Facility Authority Revenue
Bonds (Chicago Historical Society)/(Bank of
Tokyo-Mitsubishi Ltd. LOC)
4.15%, 07/07/97 $ 8,200 $ 8,200
Illinois Educational Facility Authority Revenue
Bonds (Chicago Zoological Society Brookfield
Zoo) Series B/(Chemical Bank LOC)
4.15%, 07/07/97 2,200 2,200
Illinois Educational Facility Authority Revenue
Bonds (Northwestern University)/(FNB Chicago
LOC)
4.20%, 07/07/97 22,200 22,200
Illinois Health Facility Authority Adjustable
Rate Revenue Bonds (Bensenville Home Society)
Series 1989A/(American National Bank & Trust
Co. LOC)
4.20%, 07/07/97 2,400 2,400
Illinois Health Facility Authority Revenue Bonds
(Ingalls Memorial Hospital) Series
1985C/(LaSalle National Bank LOC)
4.25%, 07/07/97 1,100 1,100
Illinois Health Facility Authority Revenue Bonds
(Washington & Jane Smith Home) Series 1991/
(Comerica Bank LOC)
4.25%, 07/07/97 2,800 2,800
Illinois Student Assistance Commission Student
Loan Revenue Bonds Series 1996A/(Bank of
America LOC)
4.20%, 07/07/97 8,400 8,400
Kane County, Illinois Revenue Bonds (Glenwood
School For Boys)/(Harris Trust & Savings Bank
LOC)
4.15%, 07/07/97 9,000 9,000
Lombard, Illinois Industrial Development Revenue
Refunding Bonds (B & H Partnership Project)/
(Comerica Bank LOC)
4.50%, 07/07/97 1,850 1,850
McHenry County, Illinois Industrial Development
Authority Revenue Refunding Bonds (Dean Foods
Co. Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 2,675 2,675
New Lenox, Illinois Industrial Development
Revenue Bonds (Panduit Corp.
Project)/(Commerzbank AG LOC)
4.20%, 07/07/97 4,400 4,400
Richton Park, Illinois Industrial Development
Revenue Bonds (Avatar Corp. Project)/(American
National Bank & Trust Company LOC)
4.25%, 07/07/97 2,000 2,000
Rockford, Illinois Industrial Development
Revenue Bonds (Industrial Welding Supply, Inc.
Project)/(American National Bank & Trust Co.
LOC)
4.39%, 07/07/97 2,000 2,000
</TABLE>
34
<PAGE> 41
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Upper Illinois River Valley Development
Authority Variable Rate Bonds (Exolon Esk
Co.)/(Chase Manhattan LOC)
4.35%, 07/07/97 $ 4,405 $ 4,405
Wheeling, Illinois Manufacturing Refunding
Revenue Bonds (Woodland Creek II) Series
1990/(FSA Insurance & SumitomoTrust SPA)
4.20%, 07/07/97 17,655 17,655
Woodstock, Illinois Multi-Family Housing Revenue
Bonds (Prairie Trail) Series 1996A/(LaSalle
National Bank LOC)
4.30%, 07/07/97 3,425 3,425
Woodstock, Illinois Multi-Family Revenue Bonds
(Prairie View Limited)/(American National Bank
& Trust Co. Company LOC)
4.30%, 07/03/97 2,035 2,035
Yorkville, Illinois Industrial Development
Revenue Bonds (F.E. Wheaton & Co. Inc.
Project) Series 1996/(American National Bank
& Trust Co. LOC)
4.37%, 07/07/97 1,600 1,600
----------
372,030
----------
INDIANA--0.9%
Gary, Indiana Economic Development Authority
Revenue Refunding Bonds (Tinplate Partnership
Project) Series 1997A/(LaSalle National Bank
LOC)
4.35%, 07/07/97 3,500 3,500
Crawfordsville, Indiana Industrial Development
Revenue Bonds (National Service Industries,
Inc. Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 4,000 4,000
Gary, Indiana Economic Development Authority
Revenue Refunding Bonds (Miller Partners Home
Improvement Project) Series 1996A/(Royal Bank
of Scotland PLC LOC)
4.25%, 07/07/97 20,540 20,540
Hammond, Indiana Economic Development Revenue
Bonds (Lear Seating Corp. Project) Series
1994/(Chemical Bank LOC)
4.10%, 07/07/97 8,700 8,700
Indianapolis, Indiana Economic Development
Authority Revenue Bonds (Herff-Jones, Inc.
Project)/(Wachovia Bank LOC)
4.40%, 07/07/97 4,100 4,100
St. Joseph College, Indiana Economic Development
Revenue Bonds Series 1997B/(FHLB LOC)
4.25%, 07/07/97 3,675 3,675
----------
44,515
----------
</TABLE>
35
<PAGE> 42
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
IOWA--0.7%
Iowa Higher Education Loan Authority Revenue
Bonds (Adjustable Convertible Extendable
Securities Education Loan Private College
Facility)/(MBIA Insurance & Dai-Ichi Kangyo
Bank SBPA)
4.15%, 07/07/97 $ 4,100 $ 4,100
Iowa Student Loan Liquidity Corp. Student Loan
Revenue Bonds Series B/(AMBAC Insurance &
Norwest Bank N.A. LOC)
4.25%, 07/07/97 28,000 28,000
----------
32,100
----------
KANSAS--0.3%
Kansas City, Kansas Industrial Revenue Bonds
(Owen Industries, Inc. Project) Series 1987/
(Sanwa Bank LOC)
4.35%, 07/07/97 1,200 1,200
Kansas State Development Finance Authority
Multi-Family Housing Revenue Bonds (1st Kansas
Project) Series 1995A/(Boatmen's First
National Bank of Kansas City LOC)
4.55%, 07/07/97 2,000 2,000
Kansas State Development Finance Authority
Multi-Family Housing Revenue Bonds (1st Kansas
Project) Series 1995C2/(Boatmen's First
National Bank of Kansas City LOC)
4.55%, 07/07/97 650 650
Olathe, Kansas Industrial Development Revenue
Bonds (Garmin International, Inc. Project)
Series 1995/(Boatmen's First National Bank of
Kansas City LOC)
4.55%, 07/07/97 1,700 1,700
Wichita, Kansas Airport Facilities Revenue Bonds
(Flightsafety International, Inc.)/(Wachovia
Bank LOC)
4.30%, 07/07/97 3,000 3,000
Wichita, Kansas Airport Facility Refunding
Revenue Bonds (Cessna Service Center
Project)/(Westdeutsche Landesbank LOC)
4.30%, 07/07/97 3,750 3,750
Wichita, Kansas Health Facilities Authority
Revenue Bonds (CSJ Health System) Series XXV/
(Sumitomo Bank LOC)
4.35%, 07/07/97 1,900 1,900
----------
14,200
----------
KENTUCKY--2.6%
Henderson County, Kentucky Solid Waste Disposal
Revenue Bonds (Hudson Foods, Inc. Project)/
(Rabobank Nederland N.V. LOC)
4.25%, 07/07/97 10,300 10,300
</TABLE>
36
<PAGE> 43
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Jefferson County, Kentucky Sports Stadium
Revenue Adjusting Bonds (University of
Louisville Athletic Department)/(Bank One
Kentucky, N.A. LOC)
4.20%, 07/07/97 $ 10,000 $ 10,000
Kentucky Higher Education Student Loan Corp.
Adjustable Rate Insured Student Loan Revenue
Bonds Series 1991E/(AMBAC Insurance & Credit
Suisse LOC)
4.25%, 07/07/97 28,000 28,000
Kentucky Higher Education Student Loan Corp.
Revenue Bonds Series 1996A/(MBIA Insurance &
Landesbank Hessen-Thuringen Girozentrale SPA)
4.25%, 07/07/97 17,000 17,000
Lebanon, Kentucky Industrial Development Revenue
Bonds (Wallace Computer Services, Inc.)/
(Wachovia Bank LOC)
4.25%, 07/07/97 5,000 5,000
Mason County, Kentucky Pollution Control
Financing Authority Revenue Bonds (East
Kentucky Power Corp.) Series
1984B-1/(N.R.U.-C.F.C. Guaranty LOC)
4.20%, 07/07/97 12,250 12,250
Mayfield, Kentucky Multi-City Lease Revenue
Bonds/(PNC Bank N.A. LOC)
4.30%, 07/07/97 18,000 18,000
Maysville, Kentucky Industrial Building Revenue
Bonds (Green Tokai Building)/(Bank of America
LOC)
4.30%, 07/07/97 5,740 5,740
Murray, Kentucky Industrial Development
Authority (Dean Foods Co.)/(Wachovia Bank LOC)
4.30%, 07/07/97 6,000 6,000
Owensboro, Kentucky Limited Obligation Revenue
Bonds (Dart Polymers, Inc. Project) Series
1985A/(National Westminster Bank PLC LOC)
4.15%, 07/07/97 1,900 1,900
Richmond, Kentucky Industrial Building Revenue
Adjusting Bonds (Mikron Project)/(Bank of
America LOC)
4.30%, 07/07/97 9,500 9,500
Wilson County, Kentucky Industrial Development
Board Revenue Bonds (Perma Pipe Project)/
(Harris Trust & Savings Bank LOC)
4.40%, 07/07/97 3,150 3,150
----------
126,840
----------
LOUISIANA--1.4%
De Soto Parish, Louisiana Pollution Control
Financing Authority Revenue Refunding Bonds
(Central Louisiana Electric Co.) Series
1991A/(Swiss Bank LOC)
4.15%, 07/07/97 400 400
</TABLE>
37
<PAGE> 44
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Louisiana Public Facility Authority Hospital
Revenue Bonds (Willis Knighton Medical
Project)/(AMBAC Insurance & Mellon Bank SBPA)
4.15%, 07/07/97 $ 17,960 $ 17,960
Natchitoches Parish, Louisiana Revenue Refunding
Bonds (Trus Joist Corp. Project)/(Bank of
Tokyo-Mitsubishi Ltd. LOC)
4.45%, 07/07/97 10,000 10,000
New Orleans, Louisiana Aviation Board Revenue
Bonds (Passenger Facility Charge
Projects)/(Banque Paribas & Canadian Imperial
Bank of Commerce LOC)
4.45%, 07/07/97 5,100 5,100
New Orleans, Louisiana Aviation Board Revenue
Bonds Series 1993B/(MBIA Insurance & Credit
Local de France SPA)
4.15%, 07/07/97 27,820 27,820
South Louisiana, Port Commission Revenue Bonds
(Holnam Project)/(ABN-Amro Bank N.V. LOC)
4.20%, 07/07/97 7,500 7,500
----------
68,780
----------
MAINE--0.6%
Maine Regional Waste System Solid Waste Recovery
Bonds Series 1990K/(Midland Bank LOC)
4.25%, 07/07/97 18,150 18,150
Maine Regional Waste System Solid Waste Resource
Recovery Revenue Bonds Series 1993-M/
(Midland Bank LOC)
4.25%, 07/07/97 4,590 4,590
Maine Regional Waste System Solid Waste Resource
Recovery Revenue Bonds Series 1995-O/(Midland
Bank LOC)
4.25%, 07/07/97 5,500 5,500
----------
28,240
----------
MARYLAND--2.0%
Baltimore, Maryland Industrial Development
Authority Revenue Bonds (City of Baltimore
Capital Acquisition Program) Series 1986/
(Dai-Ichi Kangyo Bank LOC)
4.35%, 07/07/97 52,400 52,400
Maryland State Health & Higher Education
Facility Authority Pooled Revenue Bonds
(Kennedy Krieger) Series 1993D/(FNB Maryland
LOC)
4.25%, 07/07/97 2,000 2,000
</TABLE>
38
<PAGE> 45
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Maryland State Health & Higher Education
Facility Authority Pooled Revenue Bonds
(Pooled Loan Program) Series A/
(Dai-Ichi Kangyo Bank & FNB Chicago LOC)
4.15%, 07/07/97 $ 9,700 $ 9,700
Maryland State Health And Higher Education
Facility Authority Revenue Bonds Pooled Loan
Series 1985B/(FNB Chicago LOC)
4.15%, 07/07/97 16,100 16,100
Montgomery County, Maryland Housing Opportunity
Commission Housing Revenue Bonds (Draper Lane)
Series 1991I/(FGIC Insurance & Barclays Bank
PLC SPA)
4.20%, 07/07/97 16,600 16,600
----------
96,800
----------
MASSACHUSETTS--0.0%
Massachusetts State Industrial Finance Agency
Resource Recovery Authority Revenue Bonds
(Ogden Haverhill Project) Series 1992A/(Union
Bank of Switzerland LOC)
4.10%, 07/07/97 500 500
----------
MICHIGAN--1.3%
Grand Rapids, Michigan Economic Development
Corp. Revenue Refunding Bonds Amway Hotel
Corp. Series 1991A/(ABN-Amro Bank N.V. LOC)
4.15%, 07/07/97 12,820 12,820
Michigan State Hospital Finance Authority
Revenue Bonds (Martin Luther Memorial Home
Inc.)/(Bank One Indiana, N.A.LOC)
4.15%, 07/07/97 6,520 6,520
Michigan State Strategic Fund Limited Obligation
Revenue Bonds (Dean Foods Co. Project)/
(Wachovia Bank LOC)
4.30%, 07/07/97 3,500 3,500
Michigan State Strategic Fund Limited Obligation
Revenue Bonds (Manufacturers Project) Series
1991/(Comerica Bank LOC)
4.25%, 07/07/97 2,095 2,095
Wayne Charter County, Michigan Airport Revenue
Bonds (Detroit Metropolitan County) Series
1996A/(BayerIsche Landesbank Girozentrale
LOC)
4.25%, 07/07/97 6,700 6,700
Wayne Charter County, Michigan Airport Revenue
Bonds Series B/(Bayerische Landesbank
Girozentrale LOC)
4.20%, 07/07/97 32,710 32,710
----------
64,345
----------
</TABLE>
39
<PAGE> 46
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
MINNESOTA--1.2%
Bloomington, Minnesota Port Authority Special
Tax Revenue Bonds (Mall of America Project)
Series 1996B/(FSA Insurance & Credit Local de
France SBPA)
4.20%, 07/07/97 $ 6,500 $ 6,500
Bloomington, Minnesota Port Authority Tax
Increment Revenue Refunding Bonds (Mall of
America) Series 1995A/(Credit Local de France
SBPA & FSA Insurance)
4.20%, 07/07/97 25,000 25,000
Dakota County, Minnesota Housing & Redevelopment
Authority Multi-Family Mortgage Revenue Bonds/
(Northwestern Mutual Guaranty)
4.15%, 07/07/97 14,295 14,295
Hennepin County, Minnesota Unlimited General
Obligation Bonds Series 1995C
4.15%, 07/07/97 3,800 3,800
Hennepin County, Minnesota Unlimited General
Obligation Bonds Series 1996C
4.25%, 07/07/97 5,750 5,750
Minnesota Agriculture & Economic Development
Revenue Bonds (Evangelical Lutheran
Project)/(Rabobank Nederland N.V. LOC)
4.20%, 07/07/97 5,500 5,500
----------
60,845
----------
MISSISSIPPI--0.4%
Mississippi Business Financial Corp. Industrial
Development Revenue Bonds (Omega Motion)
Series 1996/(Wachovia Bank LOC)
4.30%, 07/07/97 6,800 6,800
Mississippi Home Corp. Single Family Revenue
Bonds Series 1997G/(Bank of America LOC)
4.30%, 07/07/97 12,495 12,495
----------
19,295
----------
MISSOURI--0.7%
Mexico, Missouri Industrial Development
Authority Revenue Bonds (ADP Midwest
Manufacturing Co. Project) Series 1995/(Royal
Bank of Scotland PLC LOC)
4.35%, 07/07/97 7,100 7,100
Missouri Higher Education Loan Authority
Adjustable Rate Student Loan Revenue Bonds
Series 1988A/(National Westminster Bank LOC)
4.25%, 07/07/97 15,500 15,500
</TABLE>
40
<PAGE> 47
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Missouri State Development Board Revenue Bonds
(Milbank Manufacturing Co. Project)/(Boatmen's
First National Bank of Kansas City LOC)
4.55%, 07/02/97 $ 3,000 $ 3,000
Missouri State Development Finance Board
Industrial Development Revenue Bonds (H.R.
Williams Mill Supply Project) Series
1995/(Union Bank of Switzerland LOC)
4.25%, 07/07/97 3,100 3,100
St. Charles, Missouri Industrial Development
Authority Revenue Bonds (Land Development Co.
Project)/(Commerce Bank of St. Louis LOC)
4.53%, 07/07/97 3,850 3,850
Washington, Missouri Industrial Development
Authority Revenue Bonds (Pauwels Transformer
Project)/(Generale Bank LOC)
4.53%, 07/07/97 3,800 3,800
----------
36,350
----------
NEBRASKA--0.2%
Stanton County, Nebraska Industrial Development
Revenue Bonds Series 1996
4.30%, 07/07/97 10,500 10,500
----------
NEVADA--0.4%
Clark County, Nevada Airport Improvement Revenue
Bonds System Subordinate Lien Series
1995A-2/(Union Bank of Switzerland LOC)
4.20%, 07/07/97 1,430 1,430
Clark County, Nevada Industrial Development
Revenue Refunding Bonds (Nevada Power Co
Project) Series 1995B/(Societe Generale LOC)
4.30%, 07/07/97 12,500 12,500
Nevada Housing Division Multi-Family Housing
Revenue Bonds Series 1989A/(FNMA LOC)
4.20%, 07/07/97 4,000 4,000
----------
17,930
----------
NEW HAMPSHIRE--0.2%
New Hampshire Higher Education & Health
Facilities Authority Revenue Bonds (VHA New
England, Inc.) Series 1985B/(AMBAC Insurance &
FNB Chicago SBPA)
4.20%, 07/07/97 1,000 1,000
New Hampshire State Business Finance Authority
Pollution Control Revenue Bonds (Public
Services New Hampshire Project) Series 1992D/
(Barclays Bank PLC LOC)
4.30%, 07/07/97 1,000 1,000
</TABLE>
41
<PAGE> 48
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
New Hampshire State Housing Finance Authority
Multi- Family Housing Revenue Bonds (Fairways
Project) Series 1994-1/(General Electric
Capital Corp. LOC)
4.20%, 07/07/97 $ 7,000 $ 7,000
----------
9,000
----------
NEW MEXICO--1.4%
Albuquerque, New Mexico Airport Revenue Bonds
Subordinated Lien Series 1996A/(Bayerische
Landesbank Girozentrale LOC)
4.25%, 07/07/97 24,500 24,500
Belen, New Mexico Industrial Development Revenue
Bonds (Solo Cup, Inc. Project)/(Wachovia Bank
LOC)
4.30%, 07/07/97 3,250 3,250
New Mexico State Highway Commercial Revenue
Subordinated Lien Bonds Series 1996/(FSA
Insurance & Canadian Imperial Bank of Commerce
SPA)
4.20%, 07/07/97 38,500 38,500
----------
66,250
----------
NEW YORK--1.4%
Albany-Dougherty County, New York Hospital
Authority Revenue Bonds (Phoebe Putney
Memorial Hospital) Series 1996/(AMBAC
Insurance)
4.25%, 07/07/97 11,400 11,400
Babylon, New York Industrial Development
Authority Revenue Bonds (General
Microwave)/(National Westminster Bank LOC)
4.10%, 07/07/97 1,500 1,500
New York City, New York General Obligation Bonds
Series 1995B Subseries B-8/(Bayerische
Landesbank Girozentrale LOC)
4.10%, 07/07/97 2,500 2,500
New York City, New York Housing Development
Corp. Multi-Family Housing Mortgage Revenue
Bonds (Parkgate Tower Project)/(Citibank LOC)
4.10%, 07/07/97 3,000 3,000
New York City, New York Industrial Development
Agency Revenue Bonds (Brooklyn Navy Yard Co.)
Series 1995A/(Bank of America LOC)
4.20%, 07/07/97 12,800 12,800
New York City, New York Industrial Development
Agency Revenue Bonds (Brooklyn Navy Yard Co.)
Series 1995B/(Bank of America LOC)
4.15%, 07/07/97 5,000 5,000
New York City, New York Industrial Development
Authority Special Facility Revenue Bonds
(Korean Airlines Co. Project) Series
1997A/(Bankers Trust LOC)
4.10%, 07/07/97 12,800 12,800
</TABLE>
42
<PAGE> 49
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
New York City, New York Industrial Development
Special Facility Revenue Bonds (Korean Air
Lines Co. Project) Series 1997B/(Bankers Trust
LOC)
4.10%, 07/07/97 $ 9,100 $ 9,100
New York City, New York Industrial Development
Special Facility Revenue Bonds (Korean
Airlines Co. Project) Series 1997C/(Bankers
Trust LOC)
4.05%, 07/07/97 9,400 9,400
New York State Energy Research & Development
Authority Pollution Control Revenue Bonds
(Niagara Mohawk Power Corp. Project) Series
88A/(Morgan Guaranty Trust Co.--New York LOC)
5.50%, 07/07/97 2,200 2,200
Yonkers, New York Industrial Development Agency
Civic Facilities Revenue Bonds (Consumers
Union Facility Project) Series 1994/(AMBAC
Insurance & Credit Local de France SBPA)
3.95%, 07/07/97 500 500
----------
70,200
----------
NORTH CAROLINA--1.9%
Bladen County, North Carolina Industrial
Facility and Pollution Control Financing
Authority Resource Recovery Bonds (BCH Energy
Project LP)/(Bank of Tokyo-Mitsubishi Ltd.
LOC)
4.40%, 07/07/97 30,400 30,400
Guilford County, North Carolina Industrial
Facilities & Pollution Control Financing
Authority Revenue Bonds (Culp, Inc.
Project)/(Wachovia Bank LOC)
4.25%, 07/07/97 3,825 3,825
North Carolina Medical Care Community Hospital
Revenue Bonds (Pooled Equipment Finance
Project)/(MBIA Insurance & Banque Paribas SBPA)
4.25%, 07/07/97 600 600
Wake County, North Carolina Industrial Facility
& Pollution Control Financing Authority
Revenue Bonds (Carolina Power & Light) Series
1985B/(Sumitomo Bank LOC)
4.30%, 07/07/97 2,900 2,900
Wake County, North Carolina Industrial Facility
& Pollution Control Financing Authority
Revenue Bonds (Carolina Power & Light) Series
1985C/(Sumitomo Bank LOC)
4.30%, 07/07/97 55,050 55,050
----------
92,775
----------
</TABLE>
43
<PAGE> 50
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
NORTH DAKOTA--0.4%
Mercer County, North Dakota National Rural
Utility Pollution Control Revenue Bonds (Basin
Electric Power Cooperative Antelope Project)
Series 1984C/(N.R.U.--C.F.C. Guaranty LOC)
4.20%, 07/07/97 $ 8,010 $ 8,010
Richland County, North Dakota Industrial
Development Revenue Bonds (Minn-Dak Farmers
Co-Op) Series 1986B/(Norwest Bank LOC)
4.50%, 07/07/97 1,000 1,000
Richland County, North Dakota Solid Waste
Disposal Revenue Bonds (Minn-Dak Farmers
Co-Op) Series 1996A/(Norwest Bank LOC)
4.50%, 07/07/97 11,000 11,000
----------
20,010
----------
OHIO--0.5%
Columbus, Ohio Electric System Revenue Bonds
Series 1984/(Union Bank of Switzerland LOC)
3.70%, 07/07/97 6,580 6,580
Ohio Air Quality Development Authority Revenue
Bonds (JMG Funding, LP) Series 1994A/
(Societe Generale LOC)
4.20%, 07/07/97 2,900 2,900
Ohio Air Quality Development Authority Revenue
Bonds (Limited Partnership Project) Series
1994B/(Societe Generale LOC)
4.15%, 07/07/97 14,400 14,400
Ohio Housing Finance Agency Multi-Family Housing
Revenue Bonds (Kenwood Congregate Retirement
Community) Series 1985/(Morgan Guaranty Trust
Co.--New York LOC)
3.70%, 07/07/97 2,000 2,000
----------
25,880
----------
OKLAHOMA--0.8%
Garfield County, Oklahoma Industrial Development
Adjusting Revenue Bonds (Bank of Commerce
Group, Inc. Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 7,265 7,265
Muldrow, Oklahoma Public Works Authority
Industrial Development Revenue Bonds (Oklahoma
Foods Project)/(Rabobank Nederland N.V. LOC)
4.30%, 07/07/97 8,800 8,800
Oklahoma City, Oklahoma Industrial & Cultural
Facilities Revenue Bonds (Oklahoma Christian
College)/(Sumitomo Bank LOC)
4.50%, 07/07/97 9,000 9,000
</TABLE>
44
<PAGE> 51
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Oklahoma Development Financing Authority Revenue
Bonds (Shawnee Funding Ltd.)/(Bank of Nova
Scotia LOC)
4.30%, 07/07/97 $ 4,000 $ 4,000
Oklahoma State Student Loan Authority Revenue
Bonds Student Loan Series 1996A/(MBIA
Insurance & SLMA LOC)
4.25%, 07/07/97 10,000 10,000
Tulsa, Oklahoma Industrial Development Authority
Hospital Revenue Bonds (Hillcrest Medical
Center) Series 1988/(Bank of Tokyo-Mitsubishi
Ltd. LOC)
4.15%, 07/07/97 655 655
Tulsa, Oklahoma Industrial Development Authority
Revenue Bonds (Thomas & Betts Project) Series
1991/(Wachovia Bank LOC)
4.30%, 07/07/97 700 700
----------
40,420
----------
OREGON--0.4%
Medford, Oregon Hospital Facility Authority
Revenue Bonds (Rogue Valley Manor Project)
Series 1985/(Banque Paribas LOC)
4.35%, 07/07/97 7,700 7,700
Oregon State Economic Development Commission
Economic & Industrial Development Revenue
Bonds/(Wachovia Bank LOC)
4.20%, 07/07/97 4,100 4,100
Port of Portland, Oregon Industrial Development
Revenue Bonds (Schnitzer Steel Project)/
(Comerica Bank LOC)
4.20%, 07/07/97 5,000 5,000
Port of Portland, Oregon Special Obligation
Revenue Bonds (Portland Bulk Terminals Ltd.
Liability Corp. Project)/(Canadian Imperial
Bank of Commerce LOC)
4.30%, 07/07/97 5,000 5,000
----------
21,800
----------
PENNSYLVANIA--4.9%
Emmaus, Pennsylvania General Authority Revenue
Bonds/(FSA Insurance & Credit Suisse SPA)
4.45%, 07/07/97 73,560 73,560
Montgomery County, Pennsylvania Industrial
Development Authority Revenue Bonds (Seton
Medical Supply Co. Project)/(First Union
National Bank LOC)
4.25%, 07/07/97 5,500 5,500
Northeastern Pennsylvania Hospital and
Educational Authority Revenue Bonds (Allied
Health Pooled Financing Program)/(Chase
Manhattan LOC)
4.25%, 07/07/97 5,000 5,000
</TABLE>
45
<PAGE> 52
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Pennsylvania Energy Development Authority
(Clarion Corp.-Piney Creek Project Apartments)
Series 1986C/(Swiss Bank LOC)
4.25%, 07/07/97 $ 1,155 $ 1,155
Pennsylvania Energy Development Authority Energy
Development Revenue Bonds (B & W Ebensberg
Project) Series 1986/(Swiss Bank LOC)
4.25%, 07/07/97 8,475 8,475
Pennsylvania Higher Education Assistance Agency
Student Loan Adjustable Rate Revenue Bonds
Series 1988B/(SLMA LOC)
4.25%, 07/07/97 70,000 70,000
Pennsylvania Higher Education Assistance Agency
Student Loan Adjustable Rate Revenue Bonds
Series 1988C/(SLMA LOC)
4.25%, 07/07/97 4,000 4,000
Pennsylvania Higher Education Assistance Agency
Student Loan Adjustable Rate Revenue Bonds
Series 1994A/(SLMA LOC)
4.25%, 07/07/97 9,000 9,000
Pennsylvania Higher Education Assistance Agency
Student Loan Adjustable Rate Revenue Bonds
Series 1997A/(SLMA LOC)
4.25%, 07/07/97 20,000 20,000
Pennsylvania Higher Education Assistance Agency
Student Loan Adjustable Rate Tender Revenue
Bonds Series 1988A/(SLMA LOC)
4.25%, 07/07/97 15,100 15,100
Sayre, Pennsylvania Health Care Facilities
Authority Revenue Bonds (VHA Capital Finance
Revenue) Series 1985F/(AMBAC Insurance &
FNB Chicago SBPA)
4.15%, 07/07/97 4,100 4,100
Washington County, Pennsylvania Higher Education
Authority Revenue Bonds (Pooled Equipment
Lease)/(Sanwa Bank LOC)
4.20%, 07/07/97 12,100 12,100
York, Pennsylvania General Authority Pooled
Financing Revenue Bonds Series 1996/(First
Union Bank of North Carolina LOC)
4.15%, 07/07/97 14,000 14,000
----------
241,990
----------
RHODE ISLAND--0.7%
Rhode Island State Student Loan Authority Higher
Education Revenue Bonds Series 1995-1/
(National Westminster Bank PLC LOC)
4.25%, 07/07/97 12,300 12,300
</TABLE>
46
<PAGE> 53
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Rhode Island State Student Loan Authority Higher
Education Revenue Bonds Series 1996-2/
(National Westminster Bank PLC LOC)
4.25%, 07/07/97 $ 5,000 $ 5,000
Rhode Island State Student Loan Authority Higher
Education Revenue Bonds Series 1996-3/
(National Westminster Bank PLC LOC)
4.25%, 07/07/97 15,400 15,400
----------
32,700
----------
SOUTH CAROLINA--0.4%
Dorchester County, South Carolina Pollution
Control Revenue Bonds (BOC Group, Inc.)/
(Wachovia Bank LOC)
4.20%, 07/07/97 2,000 2,000
Greenville County, South Carolina Industrial
Development Revenue Bonds (Quality
Thermoforming Project)/(South Carolina
National Bank LOC)
4.30%, 07/07/97 1,100 1,100
South Carolina Economic Development Authority
Hospital Facility Revenue Bonds (Sanders
Brothers Construction)/(Wachovia Bank LOC)
4.30%, 07/07/97 3,150 3,150
South Carolina Jobs Economic Development
Authority Industrial Development Revenue Bonds
(Ado Corp. Project)/(South Carolina National
Bank LOC)
4.30%, 07/07/97 400 400
South Carolina Jobs Economic Development
Authority Industrial Development Revenue Bonds
(Electric City Printing Project)/(Wachovia
Bank of North Carolina LOC)
4.30%, 07/07/97 3,200 3,200
South Carolina State Port Authority Revenue
Bonds (Junior Lien)/(South Carolina National
Bank LOC)
4.25%, 07/07/97 3,300 3,300
Spartanburg County, South Carolina Industrial
Development Authority Revenue Bonds (Bemis,
Inc.)/(Wachovia Bank LOC)
4.70%, 07/07/97 4,750 4,750
----------
17,900
----------
SOUTH DAKOTA--0.3 %
South Dakota State Health & Educational
Facilities Authority Revenue Bonds (McKenna
Hospital) Series 1994/(MBIA Insurance &
Banque Paribas SBPA)
4.20%, 07/07/97 16,000 16,000
----------
</TABLE>
47
<PAGE> 54
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
TENNESSEE--2.2%
Chattanooga, Tennessee Industrial Development
Board Industrial Development Revenue Bonds
(National Print Group, Inc. Project)/(Suntrust
Bank Nashville N.A. LOC)
4.35%, 07/07/97 $ 2,600 $ 2,600
Chattanooga, Tennessee Health Education &
Housing Facility Board Revenue Bonds (Baylor
School Project)/(Sun Bank LOC)
4.20%, 07/07/97 1,700 1,700
Knox County, Tennessee Health Education and
Housing Facilities (Web School Knoxville
Project)/(Suntrust Bank Nashville N.A. LOC)
4.20%, 07/07/97 5,000 5,000
Metropolitan Nashville & Davidson County,
Tennessee Industrial Development Revenue Bonds
(Bind Technologies, Inc.)/(Nationsbank of
Tennessee, N.A. LOC)
4.20%, 07/07/97 3,750 3,750
Metropolitan Nashville & Davidson County,
Tennessee Health & Education Facility Board
Revenue Bonds Series A/(FGIC Insurance &
Barclays Bank PLC LOC)
4.15%, 07/07/97 1,200 1,200
Metropolitan Nashville & Davidson County,
Tennessee Industrial Development Multi-Family
Housing Revenue Bonds (Arbor Crest) Series
1985B/(Wachovia Bank LOC)
4.20%, 07/07/97 4,000 4,000
Metropolitan Nashville & Davidson County,
Tennessee Industrial Development Multi-Family
Housing Revenue Bonds (Arbor Knoll) Series
1985A/(Wachovia Bank LOC)
4.20%, 07/07/97 1,000 1,000
Metropolitan Nashville & Davidson County,
Tennessee Industrial Development Revenue Bonds
(Multi-Family Housing--Western)/(Sumitomo Bank
LOC)
4.50%, 07/07/97 7,035 7,035
Montgomery County, Tennessee Public Building
Authority Pooled Revenue Bonds Financing
County Loans/(Nationsbank LOC)
4.20%, 07/07/97 25,000 25,000
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1995C-1/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 4,000 4,000
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1995C-2/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 4,395 4,395
</TABLE>
48
<PAGE> 55
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1995C-3/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 $ 10,000 $ 10,000
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1995E-3/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 3,000 3,000
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1996D-1/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 3,430 3,430
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1996E-1/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 6,835 6,835
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1996E-4/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 3,000 3,000
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series 1996E-5/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 1,750 1,750
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Bonds Series II-C/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 1,100 1,100
Sevier County, Tennessee Public Building
Authority Local Government Public Improvement
Revenue Bonds Series 1996A/(AMBAC Insurance &
Kredietbank, N.V. SPA)
4.13%, 07/07/97 7,000 7,000
Volunteer State Variable Rate Student Loan
Funding Bonds Series 1987/(Hong Kong Shang Hai
Bank LOC)
4.25%, 07/07/97 10,600 10,600
----------
106,395
----------
TEXAS--6.5%
Amarillo, Texas Health Facility Corp. Hospital
Revenue Bonds (High Plains Baptist Hospital)
Series 1985/(Banque Paribas LOC)
4.40%, 07/07/97 3,100 3,100
Bexar County, Texas Health Facilities
Development Corp. Revenue Bonds (Chandler
Memorial Home Project) Series 1995/(Bank One
LOC)
4.20%, 07/07/97 5,170 5,170
Brazos River, Texas Higher Education Authority
Revenue Bonds Series 1993B-1/(SLMA LOC)
4.25%, 07/07/97 35,200 35,200
</TABLE>
49
<PAGE> 56
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Capital, Texas Industrial Development Corp.
Revenue Refunding Bonds (National Service
Industries, Inc. Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 $ 4,950 $ 4,950
Central Waco, Texas Development Corp. Industrial
Development Revenue Bonds (H.E. Butt Grocery)/
(Texas Commerce Bank, N.A. LOC)
4.20%, 07/07/97 2,900 2,900
Collin County, Texas Housing Finance Corp.
Multi-Family Housing Revenue Bonds (Huntington
Apartments Project)/(Fleet Bank, N.A. LOC)
4.30%, 07/07/97 6,150 6,150
Euless, Texas Industrial Development Authority
Revenue Bonds (Ferguson Enterprises, Inc.
Project)/(Wachovia Bank LOC)
4.20%, 07/07/97 4,850 4,850
Grand Prairie, Texas Industrial Development
Authority Industrial Development Revenue Bonds
(NTA Leasing Co. Project) Series 1994/(Texas
Commerce Bank, N.A. LOC)
4.35%, 07/07/97 2,140 2,140
Hays, Texas Memorial Health Facilities
Development Corp. Hospital Revenue Bonds
(AHS/Sunbelt Central Texas Medical Center
Project) Series 1990A/(Swiss Bank LOC)
4.20%, 07/07/97 8,800 8,800
Hays, Texas Memorial Health Facilities
Development Corp. Hospital Revenue Bonds
(AHS/Sunbelt Central Texas Medical Center
Project) Series 1990B/(Swiss Bank LOC)
4.20%, 07/07/97 15,800 15,800
Lavaca-Navidad River Authority, Texas Water
Supply System Contract Revenue Bonds (Formosa
Plastics Corp. Project)/(Canadian Imperial
Bank of Commerce LOC)
4.40%, 07/07/97 13,600 13,600
Lower Neches Valley Authority, Texas Industrial
Development Corp. Pollution Control Revenue
Bonds (Mobil Corp. Neches River Treatment
Project)
4.15%, 07/07/97 12,000 12,000
North Texas Higher Education Authority Income
Tax Student Loan Revenue Refunding Bonds
Series 1996B/ (AMBAC Insurance & SLMA SBPA)
4.25%, 07/07/97 4,000 4,000
North Texas Higher Education Authority Income
Tax Student Loan Revenue Refunding Bonds
Series 1996D/(AMBAC Insurance & SLMA SBPA)
4.25%, 07/07/97 4,000 4,000
</TABLE>
50
<PAGE> 57
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
North Texas Higher Education Authority Student
Loan Revenue Refunding Bonds Series
1987A/(Credit Communal de Belgique LOC)
4.20%, 07/07/97 $ 83,750 $ 83,750
North Texas Higher Education Authority Student
Loan Revenue Refunding Bonds Series
1996A/(SLMA LOC)
4.25%, 07/07/97 5,000 5,000
Panhandle Plains, Texas Higher Education
Authority Student Loan Revenue Bonds Series
1993A/(SLMA LOC)
4.25%, 07/07/97 13,300 13,300
Panhandle Plains, Texas Higher Education
Authority Student Loan Revenue Bonds Series
1997X/(SLMA LOC)
4.25%, 07/07/97 14,000 14,000
Panhandle Plains, Texas Higher Education Loan
Authority Student Loan Revenue Bonds Series
1991A/(SLMA LOC)
4.25%, 07/07/97 4,000 4,000
Panhandle Plains, Texas Higher Education Loan
Authority Student Loan Revenue Bonds Series
1992A/(SLMA LOC)
4.25%, 07/07/97 17,800 17,800
Panhandle Plains, Texas Higher Education Loan
Authority Student Loan Revenue Bonds Series
1995A/(SLMA LOC)
4.25%, 07/07/97 13,000 13,000
Port Arthur, Texas Navigation District (Star
Enterprises Project)/(Swiss Bank LOC)
4.25%, 07/07/97 15,500 15,500
Robertson County, Texas Industrial Development
Corp. Variable Rate Industrial Development
Revenue Bonds (Sanderson Farms Project) Series
1995/(Harris Trust & Savings Bank LOC)
4.35%, 07/07/97 4,300 4,300
Silsbee, Texas Health Facilities Development
Revenue Bonds (Silsbee Doctor's Hospital)/(HEI
Guaranty & Citibank LOC)
4.20%, 07/07/97 2,500 2,500
Texas Health Facilities Development Corp.
Adjustable Convertible Extendable Securities
Revenue Bonds (North Texas Pooled Health)
Series 1985B/(Banque Paribas LOC)
4.25%, 07/07/97 19,900 19,900
</TABLE>
51
<PAGE> 58
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Trinity River Authority, Texas Pollution Control
Revenue Bonds (Lafarge Corp. Project)/(Banque
Nationale de Paris LOC)
4.40%, 07/07/97 $ 3,100 $ 3,100
----------
318,810
----------
UTAH--1.2%
Salt Lake City, Utah Airport Revenue Bonds
Series 1996A/(Union Bank of Switzerland LOC)
4.25%, 07/07/97 2,000 2,000
Salt Lake City, Utah Airport Revenue Bonds
Series 1994A/(Credit Suisse LOC)
4.20%, 07/07/97 9,700 9,700
Utah State Board of Regents Student Loan Revenue
Bonds Series 1995L/(AMBAC Insurance & Barclays
Bank PLC LOC)
4.25%, 07/07/97 3,000 3,000
Utah State Board of Regents Student Loan Revenue
Bonds Series 1996Q/(AMBAC Insurance & Barclays
Bank PLC LOC)
4.25%, 07/07/97 9,000 9,000
Utah State Board of Regents Student Loan Revenue
Bonds Series 1997R/(AMBAC Insurance & Barclays
Bank PLC LOC)
4.25%, 07/07/97 34,255 34,255
----------
57,955
----------
VERMONT--0.1%
Vermont Education & Health Buildings Financing
Agency (VHA New England) Series 1985G/(AMBAC
Insurance & FNB Chicago SBPA)
4.20%, 07/07/97 4,240 4,240
----------
VIRGINIA--0.2%
King George County, Virginia Industrial
Development Authority Solid Waste Disposal
Facility (Garnet of Virginia Project) Series
1996/(Morgan Guaranty Trust--New York LOC)
4.20%, 07/07/97 3,700 3,700
Lynchburg, Virginia Industrial Development
Authority Hospital Facility Revenue Bonds
(First Mortgage VHA Mid-Atlantic States, Inc.)
Series 1985B/(AMBAC Insurance & Mellon Bank
SBPA)
4.20%, 07/07/97 400 400
Lynchburg, Virginia Industrial Development
Authority Hospital Facility Revenue Bonds
(First Mortgage VHA Mid-Atlantic States, Inc.)
Series 1985C/(AMBAC Insurance & Mellon Bank
SBPA)
4.20%, 07/07/97 600 600
</TABLE>
52
<PAGE> 59
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Lynchburg, Virginia Industrial Development
Authority Hospital Facility Revenue Bonds
(First Mortgage VHA Mid-Atlantic States, Inc.)
Series 1985A/(AMBAC Insurance & Mellon Bank
SBPA)
4.20%, 07/07/97 $ 500 $ 500
Staunton, Virginia Industrial Development
Authority Industrial Development Revenue Bonds
(Diebold, Inc. Staunton Project) Series
1997/(Bank One, Akron LOC)
4.30%, 07/07/97 2,500 2,500
Virginia Small Business Finance Authority
Industrial Development Revenue Bonds (Dong
Sung America)/(First Union National Bank of
North Carolina LOC)
4.30%, 07/07/97 2,380 2,380
----------
10,080
----------
WASHINGTON--2.7%
Everett, Washington Industrial Development
Revenue Bonds (Partners Trust/Synsor
Project)/(Bank of America LOC)
4.30%, 07/07/97 5,500 5,500
Pierce County, Washington Economic Development
Bonds (McFarland Cascade Project)/(U.S. Bank
of Washington LOC)
4.55%, 07/07/97 2,000 2,000
Pierce County, Washington Economic Development
Corp. Revenue Bonds (Flex-A-Lite Consolidated
Project)/(Bank of America LOC)
4.35%, 07/07/97 3,000 3,000
Port of Seattle, Washington Subordinated Lien
Revenue Bonds Series 1997/(Canadian Imperial
Bank of Commerce LOC)
4.20%, 07/07/97 79,130 79,130
Spokane County, Washington Industrial
Development Corp. Metal Sales Manufacturing
Corp./(Star Bank LOC)
4.30%, 07/07/97 3,150 3,150
Washington State Development Authority Revenue
Bonds (Hunter Douglas Project) Series
1997A/(ABN-Amro Bank N.V. LOC)
4.30%, 07/07/97 3,500 3,500
Washington State Economic Development Finance
Authority Industrial Development Revenue Bonds
(Tonkin Building) Series 1997A/(U.S. Bank of
Washington LOC)
4.55%, 07/07/97 1,000 1,000
Washington State Health Care Facilities
Authority Revenue Refunding Bonds (Sisters of
St. Joseph of Peace) Series 1993/(MBIA
Insurance & U.S. Bank of Washington SBPA)
4.15%, 07/07/97 12,400 12,400
</TABLE>
53
<PAGE> 60
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Washington State Housing Finance Authority
Multi-Family Housing Revenue Bonds (Merrill
Gardens Project) Series 1997A/(U.S. Bank of
Washington LOC)
4.30%, 07/07/97 $ 2,000 $ 2,000
Washington State Housing Finance Commission
Multi-Family Housing Mortgage Revenue Bonds
(Meridian Court Apartments) Series 1996/(Bank
of America LOC)
4.30%, 07/07/97 8,000 8,000
Washington State Housing Finance Commission
Multi-Family Mortgage Revenue Bonds (Canyon
Lake II) Series 1993A/(U.S. Bank of Washington
LOC)
4.30%, 07/07/97 4,565 4,565
Yakima County, Washington (Hi Country Foods
Project)/(Bank of America LOC)
4.30%, 07/07/97 6,800 6,800
Yakima County, Washington (Printing Press
Project)/(Bank of America LOC)
4.30%, 07/07/97 3,000 3,000
----------
134,045
----------
WEST VIRGINIA--0.3%
Marion County, West Virginia County Commission
Solid Waste Disposal Facility Revenue Bonds
(Grant Town Project)/(National Westminster
Bank LOC)
4.25%, 07/07/97 7,000 7,000
Marion County, West Virginia County Commission
Solid Waste Disposal Facility Revenue Bonds
(Grant Town Project) Series B/(National
Westminster Bank LOC)
4.25%, 07/07/97 7,000 7,000
West Virginia State Hospital Finance Authority
Hospital Revenue Bonds (St. Joseph's Hospital
Project) Series 1987/(Bank of Tokyo-Mitsubishi
Ltd. LOC)
4.20%, 07/07/97 2,100 2,100
----------
16,100
----------
WISCONSIN--0.8%
Carlton, Wisconsin Pollution Control Revenue
Bonds (Power & Light Project)
4.30%, 07/07/97 5,800 5,800
Chilton, Wisconsin Industrial Development
Revenue Bonds (Kaytee Products, Inc. Project)
Series 1995/(Bank One Milwaukee LOC)
4.30%, 07/07/97 1,675 1,675
Fairwater, Wisconsin Industrial Development
Revenue Bonds (Dean Foods Co. Project) Series
1990/(Wachovia Bank LOC)
4.20%, 07/07/97 1,450 1,450
</TABLE>
54
<PAGE> 61
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Kenosha, Wisconsin Industrial Development
Revenue Bonds (Asyst Tech. Ltd. Liability
Corp. Project)/(LaSalle National Bank LOC)
4.40%, 07/07/97 $ 5,000 $ 5,000
Lac Du Flambeau Band of Lake Superior, Wisconsin
Chippewa Indians Special Obligation Bonds
(Simpson Electric Co. Project) Series 1985/
(Barclays Bank PLC LOC)
4.15%, 07/07/97 5,900 5,900
Milwaukee, Wisconsin Redevelopment Authority
Industrial Development Revenue Bonds (Field
Container Corp. LP) Series 1994/(Northern
Trust LOC)
4.35%, 07/07/97 5,000 5,000
Prentice, Wisconsin Industrial Development
Refunding Revenue Bonds (Blount, Inc.) Series
1992/(Morgan Guaranty Trust Co.--New York LOC)
4.20%, 07/07/97 2,025 2,025
Wisconsin State Health & Education Facilities
Authority Revenue Bonds (Sinai Samaritan)
Series 1994A/(Marshall & Ilsley Bank LOC)
4.20%, 07/07/97 13,415 13,415
----------
40,265
----------
TOTAL VARIABLE RATE OBLIGATIONS
(Cost $3,119,843) 3,119,843
----------
TAX-EXEMPT COMMERCIAL PAPER--11.1%(b)
ARIZONA--2.0%
Maricopa County, Arizona Pollution Control
Revenue Authority Revenue Refunding Bonds
(Southern California Palo Alto Verde Project)
Series 1985B
3.75%, 09/09/97 7,250 7,250
Maricopa County, Arizona Pollution Control
Revenue Authority Revenue Refunding Bonds
(Southern California Palo Alto Verde Project)
Series 1985C
3.85%, 09/08/97 15,600 15,600
Maricopa County, Arizona Pollution Control
Revenue Authority Revenue Refunding Bonds
(Southern California Palo Alto Verde Project)
Series 1985G
3.90%, 08/13/97 4,000 4,000
3.85%, 09/08/97 16,250 16,250
Maricopa County, Arizona Pollution Control
Revenue Refunding Bonds (Southern California
Edison Palo Alto Verde Project) Series 1985D
3.80%, 08/12/97 7,550 7,550
</TABLE>
55
<PAGE> 62
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Maricopa County, Arizona Pollution Control
Revenue Refunding Bonds (Southern California
Edison Palo Alto Verde Project) Series 1985E
3.80%, 08/12/97 $ 12,030 $ 12,030
Salt River Project, Arizona Agricultural
Improvement Program/(Multiple Credit
Enhancements)
3.80%, 08/11/97 22,100 22,100
3.80%, 08/12/97 15,400 15,400
----------
100,180
----------
COLORADO--1.1%
Denver, Colorado City & County Airport System
Revenue Bonds Series 1990B/(Sanwa Bank SBPA)
3.85%, 08/04/97 7,520 7,520
Denver, Colorado City & County Airport System
Revenue Bonds Series 1990E/(Sanwa Bank SBPA)
3.85%, 08/04/97 3,000 3,000
Platte River, Colorado Power Authority Revenue
Bonds Series S-1/(Morgan Guaranty Trust Co.--
New York SBPA)
3.80%, 08/07/97 7,900 7,900
Platte River, Colorado Power Authority Revenue
Bonds Series S-1/(Morgan Guaranty Trust Co.--
New York SBPA)
3.80%, 07/23/97 18,000 18,000
3.85%, 09/08/97 17,200 17,200
----------
53,620
----------
KANSAS--0.2%
Burlington, Kansas Pollution Control Revenue
Refunding Bonds (Kansas Power & Light Co.
Project) Series 1987A/(Toronto-Dominion Bank
LOC)
3.85%, 09/08/97 4,500 4,500
Burlington, Kansas Pollution Control Revenue
Refunding Bonds (Kansas Power & Light Co.
Project) Series 1987B/(Deutsche Bank LOC)
3.80%, 07/23/97 2,200 2,200
3.80%, 08/07/97 2,000 2,000
3.75%, 09/09/97 1,200 1,200
----------
9,900
----------
KENTUCKY--0.0%
Pendleton County, Kentucky Multi-County Lease
Revenue Bonds (Kentucky Association Counties
Lease Program) Series 1989/(Commonwealth Bank
of Australia LOC)
3.85%, 08/11/97 2,300 2,300
----------
</TABLE>
56
<PAGE> 63
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
LOUISIANA--1.8%
Louisiana Adjustable Tender General Obligation
Refunding Bonds Series 1991A/(Credit Local de
France LOC)
4.00%, 07/01/97 $ 1,665 $ 1,665
3.80%, 07/23/97 13,950 13,950
3.80%, 09/08/97 10,150 10,150
Louisiana State Pollution Control Revenue
Refunding Bonds (St James Parish/Texaco
Project) Series 1988B
3.90%, 07/23/97 61,030 61,030
----------
86,795
----------
MICHIGAN--1.6%
Michigan State Building Authority Tax Exempt
Commercial Paper Notes Series 1/(Canadian
Imperial Bank of Commerce LOC)
3.80%, 09/04/97 79,200 79,200
----------
MINNESOTA--0.7%
Rochester, Minnesota Health Care Facilities
Revenue Bonds (Mayo Foundation/Mayo Medical
Center) Series 1988E/(Credit Suisse SBPA)
3.75%, 09/09/97 9,800 9,800
Rochester, Minnesota Health Care Facilities
Revenue Bonds (Mayo Foundation/Mayo Medical
Center) Series 1988F/(Credit Suisse SBPA)
3.90%, 08/13/97 1,800 1,800
3.80%, 09/09/97 3,700 3,700
3.75%, 09/09/97 2,900 2,900
Rochester, Minnesota Health Care Facilities
Revenue Bonds (Mayo Foundation/Mayo Medical
Center) Series 1992A
3.80%, 09/09/97 1,000 1,000
Rochester, Minnesota Health Care Facilities
Revenue Bonds (Mayo Foundation/Mayo Medical
Center) Series 1992B
3.75%, 09/09/97 3,100 3,100
Rochester, Minnesota Health Care Facilities
Revenue Bonds (Mayo Foundation/Mayo Medical
Center) Series 1992C
3.80%, 08/07/97 8,600 8,600
3.75%, 09/09/97 4,800 4,800
----------
35,700
----------
NORTH CAROLINA--1.9%
North Carolina Eastern Municipal Power Agency
Revenue Bonds/(Morgan Guaranty Trust Co.--New
York & Union Bank of Switzerland LOC)
3.75%, 07/23/97 15,000 15,000
3.85%, 08/13/97 45,435 45,435
</TABLE>
57
<PAGE> 64
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
North Carolina Eastern Municipal Power Agency
Tax Exempt Commercial Paper/(Canadian Imperial
Bank of Commerce LOC)
3.80%, 07/23/97 $ 32,500 $ 32,500
----------
92,935
----------
OHIO--0.2%
Ohio State Water Development Authority Pollution
Control Facilities Revenue Refunding Bonds
(Cleveland Illumination) Series 1988A/(FGIC
Insurance)
3.80%, 08/11/97 8,400 8,400
----------
TEXAS--1.3%
Lower Colorado River Authority Tax Exempt
Commercial Paper Series B/(Morgan Guaranty
Trust Co.-- New York LOC)
3.75%, 08/04/97 7,000 7,000
3.70%, 08/04/97 7,000 7,000
Lower Colorado River Authority Tax Exempt
Commercial Paper Series D/(Morgan Guaranty
Trust Co.-- New York LOC)
3.75%, 08/04/97 1,000 1,000
3.70%, 09/05/97 11,600 11,600
Texas Municipal Power Agency Tax Exempt
Commercial Paper/(Multiple Credit
Enhancements)
3.80%, 08/12/97 6,075 6,075
3.60%, 09/19/97 30,000 30,000
----------
62,675
----------
UTAH--0.3%
Tooele County, Utah Hazardous Waste Treatment
Revenue Bonds (Westinghouse Project) Series
1991A/(ABN-Amro Bank N.V.LOC)
3.85%, 07/21/97 10,000 10,000
3.65%, 07/21/97 3,000 3,000
----------
13,000
----------
TOTAL TAX-EXEMPT COMMERCIAL PAPER
(Cost $544,705) 544,705
----------
TAX AND REVENUE ANTICIPATION NOTES--8.0%(b)
CALIFORNIA--6.2%
California School Cash Reserve Program Authority
Pooled Tax & Revenue Anticipation Notes/(AMBAC
Insurance)(d)
3.85%, 07/02/98 200,000 201,733
</TABLE>
58
<PAGE> 65
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California School Cash Reserve Program Authority
Pooled Tax & Revenue Anticipation Notes Series
1996-97/(Industrial Bank of Japan LOC)
4.30%, 07/02/97 $ 23,800 $ 23,800
Cupertino, California Unified School District
Tax & Revenue Anticipation Notes Series
1996-97
3.80%, 07/01/97 6,500 6,500
Martinez, California Unified School District Tax
& Revenue Anticipation Notes Series 1996-97
3.80%, 07/01/97 3,300 3,300
Mountain View, California Unified School
District Tax & Revenue Anticipation Notes
Series 1996-97
3.80%, 07/02/97 2,000 2,000
Mountain View-Los Altos, California Unified High
School District Tax & Revenue Anticipation
Notes Series 1996-97
3.80%, 07/02/97 2,500 2,500
San Bernardino County, California Tax & Revenue
Anticipation Notes(d)
3.85%, 06/30/98 46,500 46,790
San Francisco, California City & County Unified
School District Tax & Revenue Anticipation
Notes Series 1996-97
3.98%, 07/24/97 5,000 5,002
San Lorenzo, California Unified School District
Tax & Revenue Anticipation Notes Series
1996-97
3.80%, 07/01/97 4,800 4,800
Sunnyvale, California Elementary School District
Tax & Revenue Anticipation Notes Series
1996-97
3.80%, 07/01/97 4,500 4,500
----------
300,925
----------
IOWA--1.0%
Iowa State School Cash Anticipation Program
(Iowa Corp. Waste Certificates) Series
1997A/(FSA Insurance)
3.80%, 06/26/98 50,000 50,332
----------
KANSAS--0.3%
Topeka, Kansas Temporary Notes Series 1996-97B
3.88%, 07/02/97 13,810 13,810
Wichita, Kansas Temporary Notes Series 1996B
3.85%, 11/20/97 1,325 1,327
----------
15,137
----------
</TABLE>
59
<PAGE> 66
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
PENNSYLVANIA--0.1%
Berks County, Pennsylvania Tax & Revenue
Anticipation Notes Series 1997A/(Mellon LOC)
3.65%, 12/31/97 $ 4,600 $ 4,616
----------
UTAH--0.4%
Salt Lake County, Utah Tax & Revenue
Anticipation Notes
3.65%, 12/31/97 20,000 20,034
----------
TOTAL TAX AND REVENUE ANTICIPATION NOTES
(Cost $391,044) 391,044
----------
MANDATORY PUT BONDS--7.4%(b)
CALIFORNIA--0.2%
California Higher Education Loan Authority
Student Loan Revenue Bonds Series
1987A/(National Westminster Bank PLC LOC)
3.95%, 07/01/97 2,500 2,500
California Higher Education Loan Authority
Student Loan Revenue Bonds Series 1987B/
(SLMA LOC)
3.95%, 07/01/97 5,000 5,000
----------
7,500
----------
FLORIDA--0.2%
Hillsborough County, Florida Authority Mortgage
Single Family Revenue Bonds/(AMBAC Insurance)
3.65%, 07/01/97 4,895 4,895
Orange County, Florida Industrial Development
Authority Revenue Bonds (General Accident
Insurance Co. of America Project)
3.81%, 12/01/97 3,500 3,500
Pinnellas County, Florida Housing Finance
Authority Single Family Revenue Bonds
(Multi-Residence/Multi-County Project) Series
1997B/(Deutsche Bank LOC)
3.80%, 02/01/98 3,500 3,500
----------
11,895
----------
GEORGIA--0.2%
Fulton County, Georgia Housing Authority Single
& Multi-Family Housing Revenue Bonds Series
1996B/(GNMA LOC)
3.85%, 03/01/98 9,000 9,020
----------
</TABLE>
60
<PAGE> 67
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
LOUISIANA--0.2%
East Baton Rouge, Louisiana Mortgage Finance
Authority Single Family Mortgage Revenue
Bonds/(Escrowed to Maturity with Government
Securities)
3.67%, 07/03/97 $ 2,745 $ 2,745
East Baton Rouge, Louisiana Mortgage Financing
Authority Single Family Mortgage Revenue Bonds
Series 1997B1/(Escrowed to Maturity with
Government Securities)
3.62%, 07/03/97 7,230 7,230
----------
9,975
----------
NEW HAMPSHIRE--0.2%
New Hampshire State Development Authority Solid
Waste Disposal Facility Revenue Bonds/
(Barclays Bank PLC LOC)
3.55%, 09/01/97 8,000 8,000
----------
OHIO--0.7%
Ohio Housing Finance Authority Residential
Mortgage Revenue Bonds Series A-2/(AIG Matched
Funding Corp. LOC)
3.65%, 07/01/97 40,000 40,000
----------
OREGON--0.1%
Oregon State Veteran Affairs General Obligation
Bonds
4.04%, 02/02/98 4,000 4,000
----------
RHODE ISLAND--0.5%
Rhode Island Housing & Mortgage Finance Corp
Home Ownership Opportunity Bonds Series 22-B
3.70%, 12/02/97 4,900 4,900
Rhode Island Student Loan Authority Revenue Put
Bonds Series 96-1/(National Westminster
Bank LOC)
3.95%, 06/01/98 19,000 19,000
----------
23,900
----------
SOUTH DAKOTA--0.5%
South Dakota Housing Development Authority Home
Ownership Mortgage Series 1996E
3.75%, 11/13/97 23,000 23,000
----------
TENNESSEE--0.9%
Metropolitan Nashville & Davidson County,
Tennessee Industrial Development Board Revenue
Bonds (General Accident Insurance) Series 1986
3.95%, 11/03/97 6,200 6,200
</TABLE>
61
<PAGE> 68
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Tennessee Housing Development Agency Alternative
Minimum Tax Homeownership Program Issue 1997-1
(Escrowed to Maturity with Goverment
Securities)
3.75%, 02/19/98 $ 12,385 $ 12,385
Tennessee Housing Development Agency
Homeownership Program Series 1997-2
3.99%, 06/04/98 28,000 28,002
----------
46,587
----------
TEXAS--2.3%
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1992B/
(SLMA LOC)
4.05%, 07/01/97 14,000 14,000
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1993A/
(SLMA LOC)
4.10%, 05/01/98 48,150 48,150
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1993B/
(SLMA LOC)
4.10%, 05/01/98 40,000 40,000
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series
1993B-2/(SLMA LOC)
4.05%, 06/01/98 6,500 6,500
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1996A/
(SLMA LOC)
3.57%, 03/01/98 7,000 7,000
----------
115,650
----------
UTAH--0.2%
Utah County, Utah Environmental Improvement
Revenue Bonds (USX Corp. Project)/(Wachovia
Bank LOC)
3.44%, 08/05/97 10,000 10,000
----------
VIRGINIA--0.6%
Virginia State Housing Development Authority
Commonwealth Mortgage Bonds Series B Subseries
B
3.88%, 06/10/98 29,700 29,700
----------
WASHINGTON--0.2%
Washington State Housing Finance Commission
Alternative Minimum Tax Bonds (Single Family
Program) Series 1991A-S/(FGIC Insurance)
3.94%, 04/01/98 7,555 7,555
----------
</TABLE>
62
<PAGE> 69
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
WISCONSIN--0.4%
Wisconsin Housing & Economic Development
Authority Home Ownership Alternative Minimum
Tax Home Ownership Revenue Bonds Series
1996G/(Bayerische Landesbank Girozentrale LOC)
4.05%, 06/01/98 $ 18,000 $ 18,000
----------
TOTAL MANDATORY PUT BONDS
(Cost $364,782) 364,782
----------
OPTIONAL PUT BONDS--2.5%(b)
CALIFORNIA--0.2%
California Higher Education Loan Authority
Student Loan Revenue Bonds Series
1995E-5/(SLMA LOC)
3.95%, 06/01/98 10,000 10,000
----------
KENTUCKY--0.0%
Calvert City, Kentucky Industrial Development
Revenue Refunding Bonds (SKW Alloys, Inc.
Lease Rent) Series 87/(Bayerische Vereinsbank
LOC)
3.80%, 10/01/97 2,235 2,235
----------
MISSOURI--0.9%
Missouri State Environmental Improvement &
Energy Resources Authority Pollution Control
Revenue Bonds (Union Electric Co.) Series
1985A/(Swiss Bank LOC)
3.95%, 06/01/98 41,890 41,890
----------
NEW HAMPSHIRE--0.1%
New Hampshire Higher Education & Health
Facilities Authority Revenue Bonds (Dartmouth
College) Series 1985A-G
3.95%, 06/01/98 5,000 5,000
----------
TEXAS--1.3%
Grapevine, Texas Industrial Development Corp.
Airport Revenue Bonds (Singer County
Project)/(Bank of Montreal LOC)
3.90%, 04/01/98 18,975 18,975
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1992A/(SLMA
LOC)
4.05%, 09/01/97 17,000 17,000
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1992B/(SLMA
LOC)
4.15%, 09/01/97 6,000 6,000
</TABLE>
63
<PAGE> 70
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1993B
3.90%, 02/01/98 $ 11,000 $ 11,000
Greater East Texas Higher Education Authority
Student Loan Revenue Bonds Series 1995B/(SLMA
LOC)
4.05%, 07/01/97 10,000 10,000
----------
62,975
----------
TOTAL OPTIONAL PUT BONDS
(Cost $122,100) 122,100
----------
BOND ANTICIPATION NOTES--2.3%(b)
IOWA--0.0%
Coralville, Iowa Bond Anticipation Notes Series
1997D
4.05%, 05/01/98 1,700 1,706
----------
NEW JERSEY--2.3%
Atlantic City, New Jersey Bond Anticipation
Notes Series 1996-97
3.70%, 11/11/97 30,000 30,057
Bordentown County, New Jersey Bond Anticipation
Notes
3.75%, 01/15/98 2,645 2,655
East Brunswick Township, New Jersey General
Obligation Bond Anticipation Notes
3.90%, 04/15/98 13,735 13,785
Hackensack, New Jersey Bond Anticipation Notes
Series 1996-97
3.50%, 12/18/97 6,178 6,192
Mahwah Township, New Jersey School District Bond
Anticipation Notes
4.00%, 07/25/97 4,225 4,226
North Bergen Township, New Jersey Board of
Education Promissory Notes Series 1997-98
3.75%, 03/13/98 2,410 2,414
Piscataway Township, New Jersey Bond
Anticipation Notes Series 1997-98
3.92%, 04/24/98 7,250 7,269
Rockaway Township, New Jersey Bond Anticipation
Notes Series 1996-97
4.00%, 07/30/97 1,910 1,911
Rockaway Township, New Jersey Special Assessment
Bond Anticipation Notes Series 1996-97
4.00%, 07/30/97 5,439 5,441
Roxbury Township, New Jersey Bond Anticipation
Notes Series 1997-98
3.65%, 02/13/98 13,984 14,013
Trenton, New Jersey Bond Anticipation Notes
3.85%, 03/11/98 12,270 12,303
</TABLE>
64
<PAGE> 71
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Vineland, New Jersey Bond Anticipation Notes
Series 1997
4.00%, 08/15/97 $ 1,400 $ 1,401
Westwood, New Jersey Bond Anticipation Notes
Series 1996-97
3.80%, 08/19/97 9,700 9,706
----------
111,373
----------
TOTAL BOND ANTICIPATION NOTES
(Cost $113,079) 113,079
----------
REVENUE BONDS--1.6%(b)
ARKANSAS--0.0%
Arkansas State Development Finance Authority
Revenue Bonds/(MBIA Insurance)
3.59%, 11/15/97 370 370
----------
INDIANA--0.1%
Indiana University Revenue Bonds (Student Fees
Project) Series J
3.50%, 08/01/97 800 800
Indianapolis, Indiana Local Public Import Bond
Bank Notes Series 1996E/(American
International Group LOC)
3.53%, 07/10/97 5,000 5,001
----------
5,801
----------
LOUISIANA--0.1%
Louisiana Stadium & Exposition District Hotel
Occupancy Tax Revenue Bonds Series 1996/(FGIC
Insurance)
3.64%, 07/01/97 685 685
Louisiana State Recovery District Sales Tax
Revenue Refunding Bonds/(MBIA Insurance)
3.80%, 07/01/97 3,000 3,000
----------
3,685
----------
MONTANA--0.0%
Montana State Housing Finance Authority
Facilities Revenue Bonds (Benefits Health Care
Project) Series 1996/(AMBAC Insurance)
3.89%, 09/01/97 1,550 1,552
----------
NEW MEXICO--0.6%
New Mexico State Severence Tax Revenue Refunding
Bonds Series 1996A
3.75%, 07/01/97 1,987 1,987
New Mexico State Severence Tax Revenue Refunding
Bonds Series 1997A(d)
3.90%, 07/01/98 22,178 22,307
</TABLE>
65
<PAGE> 72
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Santa Fe, New Mexico Single Family Mortgage
Revenue Bonds Series 1995B-1/(FGIC Insurance)
3.70%, 12/27/97 $ 3,500 $ 3,500
----------
27,794
----------
NEW YORK--0.2%
New York State Dormitory Authority Revenue Bonds
(City University) Series A/(Escrowed to
Maturity with Government Securities)
3.60%, 07/01/97 3,595 3,667
New York State Urban Development Corp. Senior
Lien Revenue Bonds
3.60%, 07/01/97 5,555 5,554
----------
9,221
----------
OHIO--0.1%
Ohio State University Revenue Refunding Bonds
Series 1992 A2
3.50%, 12/01/97 2,500 2,513
Ohio State Water Development Authority Revenue
Refunding Bonds (Pure Water Project)/(MBIA
Insurance)
3.85%, 06/01/98 1,750 1,768
----------
4,281
----------
SOUTH CAROLINA--0.1%
South Carolina State Education Assistance
Authority Revenue Refunding Bonds Student Loan
Senior Lien Series 1993A-1
3.66%, 09/01/97 4,490 4,494
----------
SOUTH DAKOTA--0.3%
Sioux Falls Sales Tax Revenue Bonds Series
1996A/(AMBAC Insurance)
3.70%, 11/15/97 445 445
Sioux Falls Sales Tax Revenue Bonds Series
1996B/(AMBAC Insurance)
3.70%, 11/15/97 570 570
South Dakota Housing Development Authority
Homeowners Mortgage Bonds Series 1997C
3.85%, 03/26/98 9,180 9,180
South Dakota Housing Development Authority
Homeownership Mortgage Bonds Series 1997D/
(Escrowed to Maturity with Government
Securities)
3.85%, 03/26/98 5,815 5,815
----------
16,010
----------
</TABLE>
66
<PAGE> 73
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
WASHINGTON--0.1%
Washington State Public Power Supply System
Nuclear Facility #2 Revenue Bonds/(Escrowed to
Maturity with Government Securities)
3.95%, 07/01/97 $ 4,250 $ 4,250
----------
TOTAL REVENUE BONDS
(Cost $77,458) 77,458
----------
FIXED RATE TENDER OPTION BONDS--1.4%(b)(e)
CONNECTICUT--0.2%
Connecticut State General Obligation General
Purpose Tender Option Bond Partnership Series
1991A (BTP-151)/(Bankers Trust Tender Option)
3.80%, 10/30/97 7,365 7,365
----------
GEORGIA--0.3%
Georgia State Public Improvement General
Obligation Tender Option Bond Partnership
Series 1993B & 1993C (BTP-135)/(Bankers Trust
Tender Option)
3.85%, 10/30/97 3,865 3,865
Georgia State Public Improvement General
Obligation Tender Option Bond Partnership
Series 1993B & 1993C (BTP-140)/(Bankers Trust
Tender Option)
3.85%, 10/30/97 4,575 4,575
Georgia State Public Improvement General
Obligation Tender Option Bond Partnership
Series 1994B (BTP-148)/(Bankers Trust Tender Option &
Escrowed to Maturity with Government
Securities)
3.85%, 10/30/97 7,100 7,100
----------
15,540
----------
SOUTH CAROLINA--0.1%
South Carolina State Capital Improvement Revenue
Refunding Tender Option Bond Partnership
Series 1992B (BTP-147)/(Bankers Trust Tender
Option)
3.85%, 10/30/97 5,370 5,370
----------
TEXAS--0.7%
Regents of the University of Texas Permanent
University Fund Revenue Tender Option Bond
Partnership Series 1992A(BTP-143)/(Escrowed to
Maturity with Government Securities, Permanent
University Fund Guaranty & Bankers Trust
Tender Option)
3.85%, 10/30/97 10,685 10,685
</TABLE>
67
<PAGE> 74
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Texas State Public Finance Authority General
Obligation Tender Option Bond Partnership
Series 1994A (BTP-127)/(Bankers Trust Tender Option)
3.85%, 10/30/97 $ 14,980 $ 14,980
Texas State Public Financing Authority General
Obligation Tender Option Bond Partnership
Series 1993B (BTP-116)/(Bankers Trust Tender Option)
3.85%, 10/30/97 10,170 10,170
----------
35,835
----------
WASHINGTON--0.1%
Washington State Public Power Supply System
Nuclear Project #2 Revenue Refunding Tender
Option Bonds Partnership Series 1993B
(BTP-137)/(Bankers Trust Tender Option)
3.85%, 10/30/97 6,685 6,685
----------
TOTAL FIXED RATE TENDER OPTION BONDS
(Cost $70,795) 70,795
----------
VARIABLE RATE TENDER OPTION BONDS--1.0%(a)(c)
FLORIDA--0.4%
Florida State General Obligation Tender Option
Bond Partnership (BTP-248)/(Bankers Trust
Tender Option)
4.25%, 07/07/97 9,300 9,300
Florida State General Obligation Tender Option
Bond Partnership (BTP-247)/(Bankers Trust
Tender Option)
4.25%, 07/07/97 9,885 9,885
----------
19,185
----------
ILLINOIS--0.3%
Chicago, Illinois Metropolitan Water Reclamation
District Greater Chicago General Obligation
Tender Option Bond Partnership (Cook County)
(BTP-71)/(Automatic Data Processing, Inc.
Tender Option)
4.32%, 07/07/97 9,870 9,870
Chicago, Illinois School Finance Authority
General Obligation School Finance Tender
Option Bond Partnership (BTP-70)/(MBIA
Insurance & Automatic Data Processing, Inc.
Tender Option)
4.32%, 07/07/97 5,365 5,365
----------
15,235
----------
</TABLE>
68
<PAGE> 75
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
MINNESOTA--0.1%
Minnesota State Various Purpose General
Obligation Sports Health Club Tax Tender
Option Bond Partnership (BTP-65)/(Automatic Data
Processing, Inc. Tender Option & Escrowed to
Maturity with Government Securities)
4.22%, 07/07/97 $ 4,455 $ 4,455
----------
WASHINGTON--0.1%
King County, Washington Unlimited Tax General
Obligation Tender Option Bond Partnership
Series 1993C (BTP-56)/(Automatic Data
Processing, Inc. Tender Option)
4.15%, 07/07/97 6,365 6,365
----------
WISCONSIN--0.1%
Wisconsin State Public Improvement General
Obligation Tender Option Bond Partnership
(BTP-62)/(Automatic Data Processing, Inc.
Tender Option & Escrowed to Maturity with
Government Securities)
4.07%, 07/07/97 4,500 4,500
----------
TOTAL VARIABLE RATE TENDER OPTION BONDS
(Cost $49,740) 49,740
----------
GENERAL OBLIGATION BONDS--0.6%(b)
ARIZONA--0.2%
Maricopa County, Arizona School District 210
General Obligation Bonds Series 1995B
3.85%, 07/01/98 3,500 3,641
----------
COLORADO--0.0%
Arapahoe, Douglas, & Jefferson Counties,
Colorado South Suburban Park & Recreation
District General Obligation Series 1996/(FGIC
Insurance)
3.70%, 12/15/97 1,210 1,214
----------
DELAWARE--0.0%
Wilmington, Delaware General Obligation Bonds
Series A/(MBIA Insurance)
3.85%, 07/01/97 1,500 1,500
----------
</TABLE>
69
<PAGE> 76
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
HAWAII--0.0%
Hawaii State Unlimited General Obligation Bonds
Series 1992BZ
3.65%, 10/01/97 $ 1,000 $ 1,005
----------
IDAHO--0.0%
Ada & Canyon Counties, Idaho Joint School
District #2 Meridan Unlimited General
Obligation Bonds Series 1996
3.60%, 07/30/97 1,000 1,001
----------
ILLINOIS--0.0%
Chicago, Illinois General Obligation Bonds
Series 1995B/(FGIC Insurance)
3.90%, 01/01/98 1,595 1,607
----------
MASSACHUSETTS--0.0%
Massachusetts State General Obligation Bonds
(Consolidated Lien Bonds) Series 1989D/
(MBIA Insurance)
3.50%, 10/01/97 1,000 1,008
----------
NEBRASKA--0.0%
Omaha, Nebraska Unlimited General Obligation
Bonds
3.50%, 10/15/97 1,000 1,002
----------
NEVADA--0.1%
Clark County, Nevada General Obligation Bonds/
(FGIC Insurance)
3.90%, 06/01/98 2,460 2,506
----------
NEW JERSEY--0.1%
Newark, New Jersey Unlimited General Obligation
Bonds Series 1996/(FSA Insurance)
3.60%, 10/01/97 2,760 2,766
----------
OKLAHOMA--0.1%
Oklahoma City, Oklahoma Unlimited General
Obligation Bonds Series 1993
3.65%, 08/01/97 3,485 3,503
----------
</TABLE>
70
<PAGE> 77
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
TENNESSEE--0.0%
Shelby County, Tennessee Public Improvement
General Obligation Bonds Series
1989A/(Escrowed to Maturity with Government
Securities & Permanent University Fund)
3.45%, 08/01/97 $ 1,020 $ 1,035
----------
TEXAS--0.0%
Travis County, Texas Limited Tax Certificate of
Obligation Bonds
3.63%, 03/01/98 1,600 1,614
----------
UTAH--0.0%
Salt Lake County, Utah Unlimited General
Obligation Bonds Series 1997(d)
3.55%, 12/15/97 2,035 2,044
----------
WASHINGTON--0.1%
Washington State General Obligation Bonds
Series R-1992-C
3.60%, 09/01/97 2,500 2,505
----------
TOTAL GENERAL OBLIGATION BONDS
(Cost $27,951) 27,951
----------
TAX ANTICIPATION NOTES--0.3%(b)
NEW JERSEY--0.3%
Essex County, New Jersey Tax Anticipation Notes
3.82%, 11/20/97 10,000 10,007
Fort Lee, New Jersey Tax Anticipation Notes
3.90%, 02/02/98 6,500 6,511
----------
TOTAL TAX ANTICIPATION NOTES
(Cost $16,518) 16,518
----------
REVENUE ANTICIPATION NOTES--0.0%(b)
ALASKA--0.0%
Alaska Student Loan Corp. Student Loan Revenue
Bonds/(AMBAC Insurance)
3.60%, 07/01/97 1,975 1,975
----------
TOTAL REVENUE ANTICIPATION NOTES
(Cost $1,975) 1,975
----------
</TABLE>
71
<PAGE> 78
SCHWAB MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
CERTIFICATES OF PARTICIPATION--0.0%(b)
TEXAS--0.0%
Houston, Texas Water Conveyance System Contract
Certificates of Participation Series T/ (AMBAC
Insurance)
3.55%, 12/15/97 $ 1,000 $ 1,009
----------
TOTAL CERTIFICATES OF PARTICIPATION
(Cost $1,009) 1,009
----------
TOTAL INVESTMENTS--100%,
(Cost $4,900,999) $4,900,999
==========
</TABLE>
See accompanying Notes to Schedule of Investments.
72
<PAGE> 79
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
VARIABLE RATE OBLIGATIONS--62.4%(a)
ABAG Financing Authority for Non-Profit
Organization Certificates of Participation
(Bentley School)/(Banque Nationale de Paris
LOC)
4.10%, 07/07/97 $ 4,000 $ 4,000
ABAG Financing Authority for Non-Profit
Organization Certificates of Participation
(Lucile Salter Packard Project)/(AMBAC
Insurance & Industrial Bank of Japan SBPA)
3.90%, 07/07/97 6,050 6,050
Alameda County, California Industrial
Development Authority Industrial Revenue Bonds
(Aitchison Family Project) Series 1993A/(Wells
Fargo Bank LOC)
4.20%, 07/07/97 2,880 2,880
Alameda County, California Industrial
Development Authority Industrial Revenue Bonds
(Scientific Technology Project) Series
1994A/(Banque Nationale de Paris LOC)
4.20%, 07/07/97 3,000 3,000
Anaheim, California Certificates of
Participation (Anaheim Memorial Hospital
Assoc. Project)/(AMBAC Insurance & ABN-Amro
SPA)
3.90%, 07/07/97 1,070 1,070
Anaheim, California Certificates of
Participation (Police Facility Financing
Project)/(AMBAC Insurance & Industrial Bank of
Japan SPA)
3.90%, 07/07/97 750 750
Anaheim, California Housing Authority
Multi-Family Housing Revenue Bonds (Casa
Grande Apartments) Series 1997A/(FNMA LOC)
4.15%, 07/07/97 3,795 3,795
Anaheim, California Housing Authority
Multi-Family Housing Revenue Bonds (Heritage
Village Apartments Project) Series
1992A/(Multiple Credit Enhancements)
4.00%, 07/07/97 3,385 3,385
Anaheim, California Housing Authority
Multi-Family Housing Revenue Bonds (Port
Trinidad Apartments) Series 1997C/(FNMA LOC)
4.15%, 07/07/97 2,140 2,140
Auburn County, California Unified School
District Capital Improvement Financing Project
Certificates of Participation (Placer County
School Project) Series 1993/(Bank of
California LOC)
4.25%, 07/07/97 5,100 5,100
</TABLE>
73
<PAGE> 80
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Big Bear Lake, California Industrial Development
Revenue Certificates of Participation
(Southwest Gas Corp. Project) Series A/(Union
Bank of Switzerland LOC)
3.95%, 07/07/97 $ 27,800 $ 27,800
California Alternative Energy Source Financing
Authority GE Capital Corp. Arroyo Series 1993B
4.05%, 07/07/97 4,860 4,860
California Economic Development Financing
Authority Industrial Development Revenue
Bonds--Calco Project/(Wells Fargo Bank LOC)
4.30%, 07/07/97 1,100 1,100
California Health Facilities Financing Authority
Revenue Bonds (Adventist Health System -
Sutter Health) Series 1991A/(Toronto-Dominion
Bank LOC)
3.90%, 07/07/97 9,800 9,800
California Health Facilities Financing Authority
Revenue Bonds (Children's Hospital Project)
Series 1991/(MBIA Insurance & Swiss Bank
SBPA)
4.00%, 07/07/97 2,800 2,800
California Health Facilities Financing Authority
Revenue Bonds (Kaiser Permanente Medical
Center) Series 1993A
3.85%, 07/07/97 8,200 8,200
California Health Facilities Financing Authority
Revenue Bonds (Kaiser Permanente Medical
Center) Series 1993B
3.85%, 07/07/97 1,600 1,600
California Health Facilities Financing Authority
Revenue Bonds (Scripps Memorial Hospital)
Series 1985B/(MBIA Insurance & Morgan
Guaranty Trust Co.-- New York SBPA)
4.05%, 07/07/97 15,120 15,120
California Health Facilities Financing Authority
Revenue Bonds (Scripps Memorial Hospital)
Series 1991A/(MBIA Insurance & Morgan
Guaranty Trust Co.-- New York SBPA)
4.05%, 07/07/97 12,980 12,980
California Health Facilities Financing Authority
Revenue Bonds (St. Francis Hospital) Series
1995E/(MBIA Insurance & Rabobank Nederland
N.V. SBPA)
3.75%, 07/07/97 4,900 4,900
California Health Facilities Financing Authority
Revenue Bonds (St. Francis Hospital) Series
1995F/(MBIA Insurance & Rabobank Nederland
N.V. SBPA)
3.90%, 07/07/97 30,000 30,000
</TABLE>
74
<PAGE> 81
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Health Facilities Financing Authority
Revenue Bonds (St. Joseph's Health System)
Series 1985
3.70%, 07/07/97 $ 1,145 $ 1,145
California Health Facilities Financing Authority
Revenue Bonds (Sutter Health Project) Series
1990A/(Morgan Guaranty Trust Co.--New York
LOC)
3.75%, 07/07/97 1,200 1,200
California Health Facility Finance Authority
Revenue Bonds (Catholic Health Care) Series
1995C/(MBIA Insurance & Rabobank Nederland
N.V. SPA)
4.05%, 07/07/97 100 100
California Housing Finance Authority Adjusted
Amount Multi-Family Housing III Series
97B/(Multiple Credit Enhancements)
4.20%, 07/07/97 14,600 14,600
California Pollution Control Financing Authority
(OMS Equity of Stanislaus)/(Swiss Bank LOC)
3.85%, 07/07/97 2,000 2,000
California Pollution Control Financing Authority
Pollution Control Revenue Bonds (Shell Oil
Corporation) Series 1991A
3.70%, 07/07/97 1,800 1,800
California Pollution Control Financing Authority
Refunding Revenue Bonds (Pacific Gas &
Electric Company) Series 1996C/(Bank of
America LOC)
3.85%, 07/07/97 22,000 22,000
California Pollution Control Financing Authority
Resource Recovery Revenue Bonds (Arco Project)
Series 1994A
4.05%, 07/07/97 1,900 1,900
California Pollution Control Financing Authority
Resource Recovery Revenue Bonds (Sanger
Project) Series 1990A/(Credit Suisse LOC)
3.95%, 07/07/97 2,800 2,800
California Pollution Control Financing Authority
Revenue Bonds (Burney Forest Production
Project) Series 1988A/(Fleet Bank N.A. LOC)
3.95%, 07/01/97 1,800 1,800
California Pollution Control Financing Authority
Revenue Bonds (Pacific Gas & Electric Company,
Project)/(Swiss Bank LOC)
4.05%, 07/07/97 47,100 47,100
California Pollution Control Financing Authority
Revenue Bonds (Pacific Gas & Electric Company,
Project) Series 1996B/(Rabobank Nederland N.V.
LOC)
4.00%, 07/07/97 97,800 97,799
</TABLE>
75
<PAGE> 82
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Pollution Control Financing Authority
Revenue Bonds (Reynolds Metals Co. Project)
Series 1985/(National Westminster Bank PLC
LOC)
3.60%, 07/07/97 $ 1,300 $ 1,300
California Pollution Control Financing Authority
Revenue Bonds (Shell Oil Company Project)
Series 1991-A
3.70%, 07/01/97 1,000 1,000
California Pollution Control Financing Authority
Revenue Bonds (Southdown, Inc. Project) Series
B/(Societe Generale LOC)
3.90%, 07/07/97 3,900 3,900
California Pollution Control Financing Authority
Revenue Bonds (Southern California Edison)
Series 1986C
5.20%, 07/01/97 1,200 1,200
California Pollution Control Financing Authority
Revenue Bonds (Southern California Edison)
Series 1986D
5.20%, 07/01/97 400 400
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Athens
Disposal Co. Project) Series 1995A/(Wells
Fargo Bank LOC)
4.05%, 07/07/97 9,900 9,900
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Burrtec
Waste Industries Project) Series 1995A/(Union
Bank LOC)
4.05%, 07/07/97 3,550 3,550
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Calsan,
Inc. Project) Series 1996A/(Wells Fargo Bank
LOC)
4.05%, 07/07/97 12,000 12,000
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Colmac
Energy Project) Series 1990A/(Swiss Bank LOC)
3.95%, 07/07/97 12,900 12,900
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Colmac
Energy Project) Series 1990B/(Swiss Bank LOC)
3.95%, 07/07/97 23,200 23,200
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Colmac
Energy Project) Series 1990C/(Swiss Bank LOC)
3.95%, 07/07/97 2,490 2,490
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Contra
Costa Services) Series 1995A/(Bank of America
LOC)
4.00%, 07/07/97 4,500 4,500
</TABLE>
76
<PAGE> 83
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Edco
Disposal Corp. Project) Series 1996A/(Wells
Fargo Bank LOC)
4.05%, 07/01/97 $ 10,000 $ 10,000
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Shell Oil
Company Martinez Project) Series 1994A
3.85%, 07/07/97 14,600 14,600
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Shell Oil
Company Martinez Project) Series 96B/(Shell
Corp. Guaranty)
4.00%, 07/02/97 36,800 36,800
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Shell Oil
Company Project) Series 1994B
3.85%, 07/07/97 12,200 12,200
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Solag
Disposal Project) Series 1997A/(Wells Fargo
Bank LOC)
4.00%, 07/07/97 3,000 3,000
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Talco
Plastics) Series 1997A/(Wells Fargo Bank LOC)
4.20%, 07/07/97 4,300 4,300
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Taormina
Industries Project) Series 1994B/(Sanwa Bank
LOC)
4.15%, 07/07/97 10,900 10,900
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Taormina
Industries Project) Series 1996A/(Sanwa Bank
LOC)
4.15%, 07/07/97 4,750 4,750
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Various
California Waste Recovery) Series 1996A/
(Wells Fargo Bank LOC)
4.05%, 07/07/97 1,815 1,815
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (West
Valley Project) Series 97A/(Union Bank of
California LOC)
4.15%, 07/07/97 9,500 9,500
California Pollution Control Financing Authority
Solid Waste Disposal Revenue Bonds (Western
Waste Industrial) Series 1994A/(Union Bank of
California LOC)
3.90%, 07/07/97 6,000 6,000
</TABLE>
77
<PAGE> 84
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Pollution Control Revenue Refunding
Bonds (Pacific Gas & Electric Company) Series
1996F/(Banque Nationale de Paris LOC)
3.85%, 07/01/97 $ 4,700 $ 4,700
California State Economic Development Financing
Authority Industrial Development Revenue Bonds
(Gaiser Tool Project)/(Bank of America LOC)
4.20%, 07/07/97 3,500 3,500
California State Economic Development Financing
Authority Revenue Bonds (Bucks Center for
Aging Project)/(California State Teachers
Retirement & Canadian Imperial Bank of
Commerce LOC)
3.95%, 07/07/97 36,500 36,500
California Statewide Community Development
Assoc. Multi-Family Housing Revenue Bonds
(Kimberly Woods Project) Series 1995B/(FNMA
LOC)
4.05%, 07/07/97 11,400 11,400
California Statewide Community Development
Authority Apartment Development Revenue
Bonds Series 1995-A3/(FNMA LOC)
3.90%, 07/07/97 45,460 45,460
California Statewide Community Development
Authority Industrial Development Revenue Bonds
Series 97-C (Watt 4 Project)/(Sanwa Bank LOC)
4.35%, 07/07/97 1,400 1,400
California Statewide Community Development
Authority Industrial Development Revenue Bonds
Series 97B (Biocol Investments LP)/(Union Bank
LOC)
4.15%, 07/07/97 1,500 1,500
California Statewide Community Development
Authority Multi-Family Housing (Plaza Club
Apartments) Series 1997A/(Comerica Bank LOC)
4.15%, 07/07/97 8,700 8,700
California Statewide Community Development
Authority Refunding Bonds Certificates of
Participation (St Joseph Health System)
3.90%, 07/07/97 18,200 18,200
California Statewide Community Development
Authority Revenue Bonds Certificates of
Participation (Kaiser Foundation Hospitals)
3.85%, 07/07/97 11,600 11,600
California Statewide Community Development
Authority Series 95-A7/(FNMA LOC)
4.05%, 07/07/97 2,000 2,000
California Statewide Community Development Corp.
Industrial Development Revenue Bonds
(13th I Associates Project)/(Union Bank LOC)
4.10%, 07/07/97 5,315 5,315
</TABLE>
78
<PAGE> 85
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (Aerostar
Properties Project)/(Union Bank LOC)
4.10%, 07/07/97 $ 4,895 $ 4,895
California Statewide Community Development Corp.
Industrial Development Revenue Bonds
(Agricultural Products, Inc. Project)/(Union
Bank LOC)
4.15%, 07/07/97 1,420 1,420
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (Arm,
Inc. Project) Series 1994A/(Bank of
Tokyo-Mitsubishi Ltd. LOC)
4.20%, 07/07/97 1,050 1,050
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (Cowden
Metal Stamping)/(Union Bank of California LOC)
4.15%, 07/07/97 2,165 2,165
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (D.V.
Industries) Series 1994A/(Bank of
Tokyo-Mitsubishi Ltd. LOC)
4.20%, 07/07/97 1,480 1,480
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (Flambeau
Airmold Project)/(Norwest Bank Minnesota N.A.
LOC)
4.30%, 07/07/97 2,850 2,850
California Statewide Community Development Corp.
Industrial Development Revenue Bonds
(Industrial Dynamics, Co. Project)/(Union Bank
LOC)
4.15%, 07/07/97 4,650 4,650
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (Lorber
Industries of California Project)/(Union Bank
LOC)
4.15%, 07/07/97 450 450
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (Pacific
Handy Cutter Products Project)/(Union Bank
LOC)
4.15%, 07/07/97 1,055 1,055
California Statewide Community Development Corp.
Industrial Development Revenue Bonds
(Packaging Innovation Project) Series
1994A/(Bank of Tokyo-Mitsubishi Ltd. LOC)
4.20%, 07/07/97 2,875 2,875
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (The
Diamond Foods Project) Series 1991/
(Union Bank LOC)
4.15%, 07/07/97 1,540 1,540
</TABLE>
79
<PAGE> 86
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Statewide Community Development Corp.
Industrial Development Revenue Bonds (Z-Nix
Co., Inc. Project)/(Union Bank LOC)
4.15%, 07/07/97 $ 840 $ 840
California Statewide Multi-Family Housing
Authority Revenue Bonds (Woodsong Apartments)
Series 97B/(FNMA LOC)
4.15%, 07/07/97 3,427 3,427
Carlsbad, California Multi-Family Housing
Revenue Refunding Bonds Certificates of
Participation (La Costa Apartment Project)
Series 1993A/(Bank of America LOC)
4.05%, 07/07/97 11,720 11,720
Concord, California Multi-Family Housing
Mortgage Revenue Bonds (Bel Air Apartments
Project) Series 1986A/(Bank of America LOC)
3.85%, 07/07/97 3,000 3,000
Contra Costa County, California Multi-Family
Housing Mortgage Revenue Bonds (El Cerrito
Project) Series A/(Bank of America LOC)
3.85%, 07/07/97 980 980
Contra Costa County, California Multi-Family
Housing Revenue Bonds (The Park Regency)
Series 1992A/(Sumitomo Bank LOC)
4.20%, 07/07/97 17,000 17,000
Duarte, California Redevelopment Agency
Certificates of Participation (Johnson Duarte
Partners Project) Series 1984B/(Bank of
America LOC)
3.95%, 07/07/97 1,600 1,600
Duarte, California Redevelopment Agency
Certificates of Participation (Piken Duarte
Partners Project) Series 1984A/(Bank of America LOC)
3.95%, 07/07/97 4,250 4,250
Eastern Municipal Water District, California
Water & Sewer Revenue Certificates of
Participation Series 1993B/(FGIC Insurance &
Industrial Bank of Japan SPA)
4.00%, 07/07/97 12,200 12,200
El Cajon, California Multi-Family Housing
Revenue Bonds (Pinewood Apartments)/(FHLB LOC)
4.35%, 07/07/97 1,450 1,450
Encinitas, California Multi-Family Housing
Revenue Refunding Bonds (Torrey Pines Project)
Series A/(Bank of America LOC)
3.75%, 07/07/97 8,100 8,100
</TABLE>
80
<PAGE> 87
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Foothill, California Eastern Transportation
Corridor Agency Toll Road Revenue Bonds Series
1995B/(Morgan Guaranty Trust Co.--New York
LOC)
4.00%, 07/07/97 $ 6,200 $ 6,200
Foothill, California Eastern Transportation
Corridor Agency Toll Road Revenue Bonds Series
1995C/(Credit Suisse LOC)
3.90%, 07/07/97 4,500 4,500
Foothill, California Eastern Transportation
Corridor Agency Toll Road Revenue Bonds Series
1995D/(Industrial Bank of Japan LOC)
4.10%, 07/07/97 7,800 7,800
Fremont, California Multi-Family Housing Revenue
Refunding Certificates of Participation (Amber
Court Apartments Project) Series 1990A/(Bank
of Tokyo-Mitsubishi Ltd. LOC)
4.10%, 07/07/97 10,380 10,380
Fresno, California Multi-Family Housing Variable
Rate Revenue Refunding Bonds (Heron Pointe
Apartments) Series 1996A/(First Interstate
Bank of California LOC)
3.95%, 07/07/97 10,375 10,375
Glenn, California Industrial Development
Authority Revenue Bonds (Land O' Lakes
Project)/(Sanwa Bank LOC)
4.55%, 07/07/97 1,900 1,900
Grand Terrace, California Community
Redevelopment Agency Multi-Family Housing
Revenue Bonds (Mount Vernon Villas Project)
Series 1985A/(Industrial Bank of Japan LOC)
4.20%, 07/07/97 8,610 8,610
Hayward, California Housing Authority
Multi-Family Housing Revenue Bonds Huntwood
Terrace Apartments/(Sumitomo Bank LOC)
4.30%, 07/07/97 2,900 2,900
Independence City, California Lease Finance
Authority Revenue Bonds (Pooled Project)
Series 1988/(National Westminster Bank PLC
LOC)
4.00%, 07/07/97 1,740 1,740
Indio, California Multi-Family Redevelopment
Bonds Refunding Housing Mortgages (Carreon
Apartments) Series 1996A/(Redlands Bank & FHLB
LOC)
4.00%, 07/07/97 3,950 3,950
Irvine Ranch Water District Capital Improvement
Revenue Bonds Series 1986/(Toronto-Dominion
Bank LOC)
3.75%, 07/01/97 5,000 5,000
</TABLE>
81
<PAGE> 88
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Irvine Ranch Water District Consolidated Revenue
Refunding Bonds (Districts 102, 103, 105 &
106)/(Commerzbank AG LOC)
3.75%, 07/01/97 $ 210 $ 210
Irvine Ranch Water District Consolidated Revenue
Refunding Bonds Series 1985A-3/(Landesbank
Hessen-Thuringen Girozentrale LOC)
3.75%, 07/01/97 2,000 2,000
Irvine Ranch, California Improvement Bond Act
1915 Revenue Bonds (Variable Assessment
District 1995-12) Series 1996A/(Kredietbank LOC)
3.75%, 07/01/97 2,400 2,400
Irvine Ranch, California Public Facilities &
Infrastructure Authority Lease Revenue Capital
Improvement Bonds Series 1987/(National
Westminster Bank PLC LOC)
4.00%, 07/01/97 1,600 1,600
Irvine Ranch, California Water District
Consolidated Revenue Refunding Bonds Series
1985A-2/(Landesbank Hessen-Thuringen
Girozentrale LOC)
3.75%, 07/01/97 7,200 7,200
Irvine Ranch, California Water District
Consolidated Revenue Refunding Bonds Series
1989/(National Westminster PLC LOC)
3.80%, 07/01/97 15,400 15,400
Irvine Ranch-Orange County, California Water
District General Obligation Bonds (Districts
105, 140, 240, 250) Series 1985B/(Bank of
America LOC)
3.75%, 07/01/97 2,500 2,500
Irvine, California Improvement Bond Act 1915
Revenue Bonds (Assessment District No.
89-10)/(National Westminster Bank PLC LOC)
3.75%, 07/01/97 3,515 3,515
Irvine, California Improvement Bond Act 1915
Revenue Bonds (Assessment District No. 94-15)/
(Dai-Ichi Kangyo Bank LOC)
3.80%, 07/01/97 2,300 2,300
Irvine, California Improvement Bond Act 1915
Revenue Bonds (Assessment District)/(Canadian
Imperial Bank of Commerce LOC)
3.90%, 07/01/97 2,300 2,300
Kern County, California Certificates of
Participation (Kern Public Facilities Project)
Series 1986C/(Union Bank of Switzerland LOC)
4.00%, 07/07/97 12,300 12,300
Kern County, California Certificates of
Participation (Kern Public Facilities Project)
Series A/(Union Bank of Switzerland LOC)
4.00%, 07/07/97 5,600 5,600
</TABLE>
82
<PAGE> 89
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Lancaster, California Redevelopment Agency
Multi-Family Revenue Bonds (Woodcreek
Garden Apartments Project) Series 1985J/(Bank
of Tokyo-Mitsubishi Ltd. LOC)
3.90%, 07/07/97 $ 10,100 $ 10,100
Livermore, California Certificates of
Participation (Reverse Osmosis
Project/(National Westminster Bank PLC LOC)
4.10%, 07/03/97 2,500 2,500
Livermore, California Multi-Family Housing
Revenue Refunding Bonds (Arbors Apartment
Project) Series 1991A/(Bank of
Tokyo-Mitsubishi Ltd. LOC)
4.10%, 07/07/97 9,255 9,255
Livermore, California Multi-Family Housing
Revenue Refunding Bonds (Diablo Vista
Apartments Project) Series 1990A/(Union Bank
LOC)
4.10%, 07/07/97 6,950 6,950
Los Angeles County, California Certificates of
Participation Adjustable Convertible
Extendable Securities (Los Angeles County
Museum of Art Project) Series 1985A/(Bank of
America LOC)
4.00%, 07/07/97 3,600 3,600
Los Angeles County, California Certificates of
Participation Adjustable Convertible
Extendable Securities (Los Angeles County
Museum of Art Project) Series 1985B/(Bank of
America LOC)
4.00%, 07/07/97 3,800 3,800
Los Angeles County, California Housing Authority
Multi-Family Housing Revenue Bonds (Sand
Canyon Villas Project) Series 1989A/(Industrial Bank
of Japan LOC)
4.30%, 07/07/97 10,800 10,800
Los Angeles County, California Metropolitan
Transportation Authority Proposition C Second
Senior Sales Tax Revenue Refunding Bonds
Series A/(MBIA Insurance & Industrial Bank of
Japan SBPA)
4.00%, 07/07/97 19,950 19,950
Los Angeles County, California Multi-Family
Housing Revenue Bonds (Lucas Studios Project)
Series 91D/(Bank of America LOC)
4.15%, 07/07/97 3,000 3,000
Los Angeles County, California Multi-Family
Mortgage Revenue Refunding Bonds (Casden
Community Complex) Series 1991C/(FHLB LOC)
3.65%, 07/07/97 3,200 3,200
</TABLE>
83
<PAGE> 90
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Los Angeles County, California Multi-Family
Mortgage Revenue Refunding Bonds (Valencia
Village Project) Series 1984C/(Industrial Bank
of Japan LOC)
4.30%, 07/07/97 $ 900 $ 900
Los Angeles County, California Pension Revenue
Refunding Bonds Series 1996A/(AMBAC Insurance
& Natwest Bank N.A. SBPA)
3.90%, 07/07/97 32,400 32,400
Los Angeles County, California Pension Revenue
Refunding Bonds Series 1996C/(Bank of Nova
Scotia LOC)
3.90%, 07/07/97 1,200 1,200
Los Angeles County, California Transportation
Commission Sales Tax Revenue Refunding Bonds
Series 1992A/ (FGIC Insurance & Industrial
Bank of Japan SBPA)
3.90%, 07/07/97 12,100 12,100
Los Angeles, California Community Redevelopment
Agency Certificates of Participation (Baldwin
Hills Public Parking Project) Series B/(Wells
Fargo Bank LOC)
3.90%, 07/07/97 27,300 27,300
Los Angeles, California Community Redevelopment
Agency Certificates of Participation (Broadway
Springs Center Project) Series 1987/(Bank of
America LOC)
3.95%, 07/07/97 10,600 10,600
Los Angeles, California Community Redevelopment
Community Agency Housing Revenue
Bonds/(Barclays Bank PLC LOC)
4.05%, 07/07/97 15,900 15,900
Los Angeles, California Multi-Family Housing
Revenue Bonds (Beverly Park Apartments)/
(Chase Manhattan LOC)
4.15%, 07/07/97 15,100 15,100
Los Angeles, California Multi-Family Housing
Revenue Bonds (Poinsettia Apartments Project)
Series 1989A/(Dai-Ichi Kangyo Bank LOC)
4.30%, 07/07/97 9,600 9,600
Los Angeles, California Multi-Family Housing
Revenue Bonds Series 1985K/(FNMA LOC)
3.75%, 07/07/97 47,000 47,000
Madera, California Public Financing Lease
Revenue Municipal Golf Course Revenue
Refinancing Authority/(Union Bank of
California LOC)
4.20%, 07/07/97 1,950 1,950
Marin County, California Housing Authority
Multi-Family Housing Revenue Bonds (Crest
Marin II Apartments Project) Series
1989A/(Dai-Ichi Kangyo Bank LOC)
4.30%, 07/07/97 11,900 11,900
</TABLE>
84
<PAGE> 91
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Metropolitan Water District of Southern
California Revenue Refunding Bonds Series
1996A/(ABN-Amro Bank N.V. LOC)
4.00%, 07/07/97 $ 18,600 $ 18,600
Modesto, California High School District &
Modesto City School District Certificates of
Participation (Capital Facilities Project)
Series 1991/(Bank of Tokyo-Mitsubishi Ltd.
LOC)
3.90%, 07/07/97 4,995 4,995
Monterey County, California Financing Authority
Revenue Bonds (Reclamation & Distribution
Projects)/(Dai-Ichi Kangyo Bank LOC)
4.25%, 07/07/97 5,000 5,000
Moorpark, California Multi-Family Housing
Revenue Refunding Bonds (Le Club Apartments
Project) Series A/(Citibank LOC)
4.05%, 07/07/97 6,000 6,000
MSR Public Power Agency Subordinate Lien (San
Juan Project) Series 1997D/(MBIA Insurance &
National Westminster Bank PLC LOC)
3.90%, 07/07/97 1,500 1,500
Northern California Power Agency Public Power
Refunding Revenue Bonds (Geothermal Project
3A)/(AMBAC Insurance & Bank of Nova Scotia
LOC)
3.90%, 07/07/97 100 100
Oakland, California Economic Development Revenue
Refunding Bonds (Leamington Hotel Project)
Series 1994A/(First Interstate Bank of
California LOC)
4.00%, 07/07/97 4,250 4,250
Orange County, California Apartment Development
Revenue Bonds Series 1985U/(Chase Manhattan
LOC)
4.10%, 07/07/97 9,300 9,300
Orange County, California Apartment Development
Revenue Bonds Series 1985V/(MetLife Guaranty LOC)
4.10%, 07/07/97 15,150 15,150
Orange County, California Apartment Development
Revenue Refunding Bonds (Jess L. Frost
Project) Series 1985B/(Wells Fargo Bank LOC)
4.10%, 07/07/97 8,200 8,200
Orange County, California Apartment Development
Revenue Refunding Bonds (The Lakes Project
#185) Series 1991A/(Citibank LOC)
4.05%, 07/07/97 32,050 32,050
</TABLE>
85
<PAGE> 92
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Orange County, California Apartment Development
Revenue Refunding Bonds (Villa Marguerite
Apartments) Series 1993A/(Union Bank of
Switzerland LOC)
4.00%, 07/07/97 $ 4,635 $ 4,635
Orange County, California Certificates of
Participation (Florence Crittenton Services
Project) Series 1990/(Swiss Bank LOC)
3.90%, 07/07/97 6,500 6,500
Orange County, California Sanitation District
Certificates of Participation (Districts 1, 2,
3, 6, 7 & 11) Series 1992C/(FGIC Insurance &
FGIC SPA)
3.90%, 07/01/97 9,400 9,400
Orange County, California Sanitation District
Certificates of Participation (Sanitation
Districts 1, 2, 3, 5, 6, 7 & 11) Series
1992/(AMBAC Insurance & Industrial Bank of
Japan SBPA)
4.00%, 07/07/97 60,245 60,245
Orange County, California Sanitation District
Certificates of Participation Series
1990-92A/(National Westminster Bank PLC LOC)
3.75%, 07/01/97 11,440 11,440
Orange County, California Water District
Certificates of Participation Series
1990B/(National Westminster Bank PLC LOC)
3.75%, 07/07/97 6,100 6,100
Orange County, California Water District
Improvement Bond Act 1915 Revenue Bonds
(Irvine Coast Assessment District) Number
88-1/(Kredietbank, N.V. & Societe Generale
LOC)
3.90%, 07/01/97 18,757 18,757
Panama Buena Vista, California Unified School
District Certificates of Participation (1994
Capital Improvement Financing Project)/(Bank
of California LOC)
4.25%, 07/07/97 4,000 4,000
Pleasant Hill, California Multi-Family Housing
Revenue Bonds (Brookside Apartments
Project)/(FNMA LOC)
4.00%, 07/07/97 5,400 5,400
Redlands, California Certificates of
Participation Refunding Water Treatment
Facilities Project/(FGIC Insurance & FGIC SPA)
4.00%, 07/07/97 6,800 6,800
Riverside County, California Certificates of
Participation (Riverside County Public
Facility Project) Series 1985B/(Sanwa Bank LOC)
4.00%, 07/07/97 14,075 14,075
</TABLE>
86
<PAGE> 93
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Riverside County, California Certificates of
Participation (Riverside County Public
Facility Project) Series 1985C/(Sanwa Bank LOC)
4.00%, 07/07/97 $ 10,325 $ 10,325
Riverside County, California Housing Authority
Multi-Family Housing Revenue Bonds (Briarwood
Apartment Project) Series 1985C/(FHLB LOC)
4.00%, 07/07/97 4,500 4,500
Riverside County, California Industrial
Development Authority Revenue Bonds (Calmold,
Inc. Project)/(Union Bank of California LOC)
4.20%, 07/07/97 2,900 2,900
Riverside County, California Industrial
Development Revenue Bonds (Cryogenic Project)
Series 1989B-1/(Rabobank Nederland N.V. LOC)
3.95%, 07/07/97 4,100 4,100
Sacramento County, California Certificates of
Participation (Administration Center & Court
House Project)/(Union Bank of Switzerland LOC)
3.90%, 07/07/97 17,500 17,500
Sacramento County, California Housing Authority
Multi-Family Housing Revenue (River Terrace
Apartments) Series 96C/(Dai-Ichi Kangyo Bank
LOC)
4.20%, 07/07/97 3,100 3,100
Sacramento County, California Housing Authority
Multi-Family Housing Revenue Bonds Series 97A
(Chesapeake Commons)/(Bank One LOC)
4.05%, 07/07/97 20,000 20,000
Salinas, California Apartment Development
Multi-Family Housing Revenue Bonds (Mariner
Villa Project) Series 1985B/(Bank of America
LOC)
3.75%, 07/07/97 2,725 2,725
San Bernardino County, California Certificates
of Participation (Glen Helen Blockbuster
Pavilion Project) Series 1994C/(Bank of
Tokyo-Mitsubishi Ltd. LOC)
4.25%, 07/07/97 6,990 6,990
San Bernardino County, California Housing
Authority Multi-Family Housing (Mountclair
Heritage) Series 93A/(FHLB & California
Federal Bank LOC)
4.05%, 07/07/97 4,620 4,620
San Bernardino County, California Housing
Authority Multi-Family Housing (Rialto
Heritage) Series 93A/(FHLB LOC)
4.05%, 07/07/97 4,330 4,330
San Bernardino County, California Multi-Family
Housing Revenue Bonds (Western Properties
Project IV) Series 1985/(Bank of America LOC)
4.00%, 07/07/97 4,100 4,100
</TABLE>
87
<PAGE> 94
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
San Diego, California Housing Authority
Multi-Family Housing Revenue Bonds (La Cima)
Series 1985K/(Citibank LOC)
4.05%, 07/07/97 $ 4,005 $ 4,005
San Francisco, California City & County Housing
Authority Multi-Family Housing Revenue Bonds
(737 Post Project)Series 1985D/(Banque
Nationale de Paris LOC)
3.95%, 07/07/97 16,800 16,800
San Francisco, California City & County
Redevelopment Agency Multi-Family Housing
Revenue Bonds (Fillmore Center Project) Series
A-1/(Citibank LOC)
4.00%, 07/07/97 26,500 26,500
San Francisco, California City & County
Redevelopment Agency Multi-Family Housing
Revenue Bonds (Fillmore Center Project) Series
A-2/(Citibank LOC)
4.05%, 07/07/97 3,750 3,750
San Francisco, California City & County
Redevelopment Agency Multi-Family Housing
Revenue Bonds (Rincon Center Apartments)
Series 1985B/(Citibank LOC)
4.00%, 07/07/97 9,005 9,005
San Jose, California Multi-Family Housing
Revenue Authority (Almeden Lake Apartments)
Series 1997A/(Bank of America LOC)
4.10%, 07/07/97 6,500 6,500
San Jose, California Multi-Family Housing
Revenue Bonds (Sienna At Renaissance) Series
1996A
4.10%, 07/07/97 10,500 10,500
San Jose, California Redevelopment Agency Merged
Area Redevelopment Project Revenue
Bonds/(Morgan Guaranty Trust Co.--New York
LOC)
3.50%, 07/07/97 5,000 5,000
San Jose, California Redevelopment Agency Merged
Area Redevelopment Project Series 96A/(Morgan
Guaranty Trust Co.--New York LOC)
3.90%, 07/07/97 10,600 10,600
Santa Ana, California Unified School District
Certificates of Participation (Land
Acquisition Project)/(Sanwa Bank LOC)
3.90%, 07/07/97 4,400 4,400
Santa Clara County, California Hospital Facility
Authority Revenue Bonds (El Camino Hospital
District--Valley Medical Center Project)
Series 1985B/(National Westminster Bank PLC
LOC)
3.90%, 07/07/97 8,000 8,000
</TABLE>
88
<PAGE> 95
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Santa Clara County, California Multi-Family
Housing Refunding Revenue Bonds (Brairwood
Apartments) Series 1996B/(FNMA LOC)
4.00%, 07/07/97 $ 7,800 $ 7,800
Santa Clara County, California Multi-Family
Housing Revenue Bonds Grove Garden Apartments
Series 97A/(FNMA LOC)
4.00%, 07/07/97 14,000 14,000
Santa Clara, California Electric Revenue Bonds
Series 1985A/(National Westminster
Bank PLC LOC)
4.00%, 07/07/97 12,600 12,600
Santa Clara, California Electric Revenue Bonds
Series 1985B/(National Westminster Bank
PLC LOC)
4.00%, 07/07/97 11,500 11,500
Santa Clara, California Electric Revenue Bonds
Series 1985C/(National Westminster Bank
PLC LOC)
4.00%, 07/07/97 8,300 8,300
Santa Cruz County, California Housing Authority
Multi-Family Housing Revenue Bonds (Paloma Del
Mar Apartments Project) Series 1992A/(Bank of
Tokyo-Mitsubishi Ltd. LOC)
3.95%, 07/07/97 7,700 7,700
Santa Rosa, California Multi-Family Housing
Revenue Bonds (Quail Run Apartments) Series
97A/(U.S. Bank of Washington LOC)
4.20%, 07/07/97 1,500 1,500
Simi Valley, California Multi-Family Housing
Revenue Bonds (Lincoln Wood Ranch Project)/
(Sumitomo Bank LOC)
4.15%, 07/07/97 2,000 2,000
South San Francisco, California Multi-Family
Revenue Bonds (Magnolia Plaza Apartments
Project) Series A/(Wells Fargo Bank LOC)
4.05%, 07/07/97 4,500 4,500
Southeast Resource Recovery Facility Lease
Revenue Refunding Bonds Series
1995A/(Industrial Bank of Japan LOC)
4.10%, 07/07/97 33,100 33,100
Southern California Public Power Authority
Refunding Revenue Bonds (Palos Verdes Project)
Series 1996B/(AMBAC Insurance & Morgan
Guaranty Trust Co.--New York LOC)
3.90%, 07/07/97 1,800 1,800
</TABLE>
89
<PAGE> 96
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Southern California Public Power Authority
Revenue Bonds (Southern Transmission Project)
Series 1991/(AMBAC Insurance & Swiss Bank LOC)
3.90%, 07/07/97 $ 4,900 $ 4,900
Southern California Public Power Authority
Revenue Refunding Bonds (Southdown
Transmission Project) Series 1996B/(FSA
Insurance & Morgan Guaranty Trust Co.--New
York SPA)
3.90%, 07/07/97 37,500 37,500
Turlock, California Irrigation District
Certificates of Participation (Transmission
Project, Municipal Utilities--Water & Sewer)
Series 1996A/(Societe Generale LOC)
3.90%, 07/07/97 2,200 2,200
Union City, California Multi-Family Housing
Revenue Bonds (Greenhaven Apartments) Series
97A/ (FNMA LOC)
4.05%, 07/07/97 10,975 10,975
Victor Valley, California Certificates of
Participation (Capital Improvements Financing
& Refunding Project)/(Banque Nationale de
Paris & Dai-Ichi Kangyo Bank LOC)
4.25%, 07/07/97 6,400 6,400
----------
TOTAL VARIABLE RATE OBLIGATIONS
(Cost $1,764,358) 1,764,358
----------
TAX AND REVENUE ANTICIPATION NOTES--17.4%(b)
Acalanes, California Unified High School
District Tax & Revenue Anticipation Notes(d)
3.79%, 06/30/98 6,000 6,041
Acalanes, California Unified High School
District Tax & Revenue Anticipation Notes
Series 1996-97
3.80%, 07/01/97 5,700 5,700
Berkeley, California Unified School District Tax
& Revenue Anticipation Notes Series 1996-97
3.85%, 07/01/97 9,400 9,400
California School Cash Reserve Program Authority
Pooled Tax & Revenue Anticipation Notes/(AMBAC
Insurance)(d)
3.85%, 07/02/98 50,000 50,433
California School Cash Reserve Program Authority
Pooled Tax & Revenue Anticipation Notes
Series 1996-97/(Industrial Bank of Japan LOC)
3.85%, 07/02/97 43,970 43,971
</TABLE>
90
<PAGE> 97
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Statewide Community Development
Authority Tax & Revenue Anticipation Notes
Series A/(FSA Insurance)(d)
3.80%, 06/30/98 $102,000 $ 102,686
Contra Costa County, California Tax & Revenue
Anticipation Notes Series 1996-97
4.50%, 07/03/97 10,000 10,000
Cotati-Rohnert Park, California Tax & Revenue
Anticipation Notes Series 1996-97
3.55%, 08/13/97 1,500 1,502
Desert Sands, California Unified School District
Tax & Revenue Anticipation Notes(d)
3.80%, 07/07/98 9,200 9,204
Desert Sands, California Unified School District
Tax & Revenue Anticipation Notes Series
1996-97
3.80%, 07/02/97 4,500 4,500
Fontana, California Unified School District Tax
& Revenue Anticipation Notes Series 1996-97
3.95%, 07/11/97 10,000 10,001
Fullerton, California Joint Unified High School
District Tax & Revenue Anticipation Notes
Series 1996-97
3.90%, 09/05/97 2,365 2,367
Los Rios, California City & County Development
Tax & Revenue Anticipation Notes Series
1996-97
3.95%, 09/19/97 12,500 12,514
Oakland, California Unified School District
Alameda County Tax & Revenue Anticipation
Notes
3.60%, 10/14/97 15,000 15,027
Pleasanton, California Unified School District
Tax & Revenue Anticipation Notes(d)
3.79%, 06/30/98 5,300 5,336
Pleasanton, California Unified School District
Tax & Revenue Anticipation Notes Series
1996-97
3.80%, 07/01/97 5,400 5,400
Puerto Rico Commonwealth Tax & Revenue
Anticipation Notes Series 1
3.43%, 07/30/97 15,000 15,007
Sacramento County, California Tax & Revenue
Anticipation Notes
3.76%, 09/30/97 200 200
San Bernardino County, California Tax & Revenue
Anticipation Notes(d)
3.85%, 06/30/98 50,000 50,312
San Francisco, California City & County Unified
School District Tax & Revenue Anticipation
Notes Series 1996-97
3.98%, 07/24/97 40,000 40,013
</TABLE>
91
<PAGE> 98
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
San Juan, California Unified School District Tax
& Revenue Anticipation Notes Series 1996-1997
4.50%, 09/24/97 $ 30,000 $ 30,037
San Leandro, California Unified School District
Tax & Revenue Anticipation Notes Series
1996-97
3.80%, 07/01/97 5,000 5,000
Sanger, California Unified School District Tax &
Revenue Anticipation Notes Series 1996-97
3.57%, 11/26/97 5,000 5,018
Santa Barbara County, California Tax & Revenue
Anticipation Notes Series 96A
3.62%, 10/01/97 2,000 2,006
Stockton, California Unified School District Tax
& Revenue Anticipation Notes Series 1996-97
3.54%, 11/26/97 16,000 16,029
Sunnyvale, California Tax & Revenue Anticipation
Notes(d)
3.79%, 06/30/98 5,000 5,034
Temecula Valley, California Unified School
District Tax & Revenue Anticipation Notes
Series 1996-97
3.80%, 07/02/97 7,000 7,000
Ventura County, California Tax & Revenue
Anticipation Notes(d)
3.85%, 06/30/98 12,000 12,046
West Contra Costa Unified School District Tax &
Revenue Anticipation Notes(d)
3.85%, 06/30/98 10,000 10,038
----------
TOTAL TAX AND REVENUE ANTICIPATION NOTES
(Cost $491,822) 491,822
----------
TAX-EXEMPT COMMERCIAL PAPER--15.7%(b)
Anaheim, California Electric Revenue Tax-Exempt
Commercial Paper/(Bank of America & Morgan
Guaranty Trust Co.--New York LOC)
3.60%, 09/30/97 9,950 9,950
California Pollution Control Financing Authority
(Southern California Edison) Series 1985B
3.75%, 08/13/97 2,200 2,200
3.85%, 08/21/97 2,100 2,100
California Pollution Control Financing Authority
Pollution Control Revenue Bonds (Pacific Gas &
Electric) Series 1996D/(Union Bank of
Switzerland LOC)
3.75%, 08/11/97 17,000 17,000
California Pollution Control Financing Authority
Revenue Bonds (Southern California Edison)
Series 88A/(National Westminster Bank PLC
LOC)
3.75%, 08/19/97 27,500 27,500
</TABLE>
92
<PAGE> 99
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
California Pollution Control Financing Authority
Revenue Bonds Series 85A (Southern California
Edison)
3.75%, 08/13/97 $ 6,500 $ 6,500
3.65%, 08/15/97 12,000 12,000
3.85%, 08/21/97 4,900 4,900
East Bay Municipal Utility District Tax-Exempt
Commercial Paper (Wastewater Systems)/(National
Westminster Bank PLC LOC)
3.60%, 07/08/97 3,000 3,000
3.60%, 07/09/97 10,700 10,700
3.75%, 09/11/97 5,500 5,500
Long Beach, California Harbor Tax-Exempt
Commercial Paper/(Multiple Credit
Enhancements)
3.75%, 08/07/97 2,000 2,000
3.70%, 08/13/97 4,000 4,000
3.70%, 09/09/97 32,100 32,100
Los Angeles, California Wastewater System
Tax-Exempt Commercial Paper/(Multiple Credit
Enhancements)
3.70%, 08/07/97 34,500 34,500
Metropolitan Water District of Southern
California Tax-Exempt Commercial Paper
3.75%, 09/11/97 10,000 10,000
Orange County, California Local Transportation
Authority Sales Tax-Exempt Commercial
Paper/(Union Bank of Switzerland LOC)
3.70%, 08/15/97 51,000 51,000
Sacramento, California Municipal Utility
District Tax-Exempt Commercial
Paper/(Bayerische Landesbank Girozentrale LOC)
3.80%, 09/25/97 16,000 16,000
3.80%, 09/26/97 12,424 12,424
San Diego County, California Teeter Obligation
Tax-Exempt Commercial Paper Notes Series
B/(Industrial Bank of Japan LOC)
3.90%, 07/08/97 32,750 32,750
3.65%, 07/11/97 1,800 1,800
3.65%, 07/14/97 24,813 24,813
State of California Tax-Exempt Commercial Paper/
(Multiple Credit Enhancements)
3.65%, 08/22/97 25,000 25,000
University of California Board of Regents
Tax-Exempt Commercial Paper Notes/(Bank of
America LOC)
3.60%, 07/08/97 7,000 7,000
University of California Board of Regents
Tax-Exempt Commercial Paper Notes/(Multiple
Credit Enhancements)
3.65%, 08/15/97 30,000 30,000
3.70%, 09/19/97 20,000 20,000
</TABLE>
93
<PAGE> 100
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
West & Central Basin Financing Authority West
Basin Municipal Water District Commercial
Paper Notes/(Toronto-Dominion Bank LOC)
3.80%, 08/06/97 $ 15,000 $ 15,000
3.75%, 08/07/97 8,500 8,500
3.50%, 08/07/97 15,000 15,000
----------
TOTAL TAX-EXEMPT COMMERCIAL PAPER
(Cost $443,237) 443,237
----------
REVENUE BONDS--1.4%(b)
California Health Facilities Financing Authority
Revenue Bonds (Catholic Health Care) Series
1996A/(MBIA Insurance)
3.75%, 07/01/97 4,450 4,450
Fairfield, California Public Financing Authority
Revenue Bonds (Pre-Refunded) Series
1989A/(Escrowed to Maturity with Government
Securities)
1.04%, 08/01/97 15,115 15,469
Los Angeles County, California Public Works
Finance Authority Lease Refunding Bonds Series
1996A/(MBIA Insurance)
3.88%, 09/01/97 10,060 10,070
Northern California Power Agency Public Power
Revenue Refunding Bonds (Geothermal Project
#3) Series 1996B/(AMBAC Insurance)
3.62%, 07/01/97 6,525 6,525
Orange County, California Apartment Revenue
Bonds/(MBIA Insurance)
3.88%, 07/01/98 1,500 1,516
Orange County, California Transportation
Authority Sales Tax Revenue Bonds
3.70%, 02/15/98 1,105 1,114
----------
TOTAL REVENUE BONDS
(Cost $39,144) 39,144
----------
FIXED RATE TENDER OPTION BONDS--1.4%(b)(e)
California State Department of Water Resources
Revenue Bonds (Central Valley Project) Series
J3 Tender Option Bond Partnership (BTP-141)/
(Bankers Trust Tender Option)
3.80%, 10/30/97 5,155 5,155
Los Angeles County, California Transportation
Commission Sales Tax Revenue Bonds Tender
Option Bond Partnership(BTP-146)/(Bankers
Trust Tender Option & Escrowed to Maturity
with Government Securities)
3.80%, 10/30/97 23,078 23,078
</TABLE>
94
<PAGE> 101
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
Metropolitan Water District of Southern
California General Obligation Revenue
Refunding Bonds Series 1993A-1 & 1993A-2
Tender Option Bond Partnership (BTP-115)/
(Bankers Trust Tender Option)
3.80%, 10/30/97 $ 10,145 $ 10,145
----------
TOTAL FIXED RATE TENDER OPTION BONDS
(Cost $38,378) 38,378
----------
GENERAL OBLIGATION BONDS--0.6%(b)
California State General Obligation Bonds
Series 93
3.85%, 09/01/97 1,600 1,607
California State General Obligation Bonds
Series 96
3.92%, 06/01/98 13,430 14,038
----------
TOTAL GENERAL OBLIGATION BONDS
(Cost $15,645) 15,645
----------
MANDATORY PUT BONDS--0.5%(b)
California Health Facilities Financing Authority
Single Family Mortgage Revenue Bonds/(Morgan
Guaranty Trust Co.--New York LOC)
3.70%, 04/01/98 14,500 14,500
----------
TOTAL MANDATORY PUT BONDS
(Cost $14,500) 14,500
----------
VARIABLE RATE TENDER OPTION BONDS--0.3%(a)(c)
Los Angeles, California Department of Water &
Power Electric Plant Revenue Refunding Bonds
Series 1994 Tender Option Bond Partnership
(BTP-68)/(Automatic Data Processing, Inc.
Tender Option)
4.28%, 07/07/97 5,195 5,195
Metropolitan Water District of Southern
California Revenue Bonds Tender Option Bond
Partnership (JPM-32B)/(Morgan Guaranty Trust
Tender Option)
4.05%, 07/07/97 3,000 3,000
----------
TOTAL VARIABLE RATE TENDER OPTION BONDS
(Cost $8,195) 8,195
----------
CERTIFICATES OF PARTICIPATION--0.3%(b)
California Statewide Community Development
Authority Revenue Certificates of
Participation (St. Joseph Health System)
3.10%, 07/01/97 2,655 2,655
</TABLE>
95
<PAGE> 102
SCHWAB CALIFORNIA MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
-------- ----------
<S> <C> <C>
El Camino, California Hospital Revenue
Certificates of Participation Series 1987A
3.45%, 09/01/97 $ 2,000 $ 2,057
Sacramento, California Public Financing
Authority Certificates of Participation Series
1987
3.50%, 08/01/97 3,075 3,163
----------
TOTAL CERTIFICATES OF PARTICIPATION
(Cost $7,875) 7,875
----------
TOTAL INVESTMENTS--100%
(Cost $2,823,154) $2,823,154
==========
</TABLE>
See accompanying Notes to Schedule of Investments.
96
<PAGE> 103
SCHWAB NEW YORK MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
VARIABLE RATE OBLIGATIONS--66.8%(a)
Albany, New York Industrial Development Agency
Adjustable Rate Revenue Bonds (Newkirk Products,
Inc.) Series 1995A/(Fleet Bank of New York LOC)
4.40%, 07/07/97 $ 1,000 $ 1,000
Cortland County, New York Industrial Development
Agency Revenue Bonds (General Signal Corp.
Project) Series 1983/(Wachovia Bank LOC)
4.10%, 07/07/97 1,750 1,750
Erie County, New York Water Authority Water
Revenue Bonds Series 1993B/(National Australia
Bank LOC)
4.05%, 07/07/97 3,500 3,500
Franklin County, New York Industrial Development
Agency Revenue Bonds (Kes Chateaugay LP Project)
Series A/(Bank of Tokyo-Mitsubishi Ltd. LOC)
4.25%, 07/07/97 14,300 14,300
Monroe County, New York Industrial Development
Agency Revenue Bonds (ENBI Corp. Lease Rent
Project) Series 1988/(ABN-Amro Bank N.V. LOC)
4.00%, 07/07/97 2,000 2,000
Nassau County, New York Industrial Development
Authority Civic Facilities Revenue Bonds (Cold
Spring Harbor Lab Project)/(Morgan Guaranty
Trust Co.--New York LOC)
4.10%, 07/07/97 1,400 1,400
New York City, New York Cultural Trust Resource
Revenue Adjustable Bonds (American Museum of
Natural History) Series 1991B/(Credit Suisse
LOC)
4.05%, 07/07/97 800 800
New York City, New York General Obligation Bonds
Series 1993 Subseries A-8/(Morgan Guaranty Trust
Co.-- New York LOC)
4.15%, 07/01/97 15 15
New York City, New York General Obligation Bonds
Series 1993A9/(Morgan Guaranty Trust Co.--New
York LOC)
4.05%, 07/07/97 1,000 1,000
New York City, New York General Obligation Bonds
Series 1994-B Subseries B-2/(Bank Austria
Aktiengesellschaft SBPA & MBIA Insurance)
4.15%, 07/01/97 700 700
New York City, New York General Obligation Bonds
Series 1994B Subseries B3/(Bank of Nova Scotia
SBPA & MBIA Insurance)
4.15%, 07/01/97 1,700 1,700
New York City, New York General Obligation Bonds
Series 1995B Subseries B-10/(Union Bank of
Switzerland LOC)
4.10%, 07/07/97 4,600 4,600
</TABLE>
97
<PAGE> 104
SCHWAB NEW YORK MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
New York City, New York General Obligation Bonds
Series 1995B Subseries B-8/(Bayerische
Landesbank Girozentrale LOC)
4.10%, 07/07/97 $ 600 $ 600
New York City, New York General Obligation Bonds
Series 94B-B7/(AMBAC Insurance & Escrowed to
Maturity with Government Securities LOC)
4.15%, 07/07/97 3,800 3,800
New York City, New York Housing Development Corp.
Multi-Family Housing Mortgage Revenue Bonds
(Columbus Gardens Project) Series 1993A/
(Citibank LOC)
4.10%, 07/07/97 3,165 3,165
New York City, New York Housing Development Corp.
Multi-Family Housing Mortgage Revenue Bonds
(Parkgate Tower Project)/(Citibank LOC)
4.10%, 07/07/97 16,095 16,095
New York City, New York Housing Development Corp.
Multi-Family Housing Mortgage Revenue Bonds
(Tribeca Towers Project) Series 1994A/(FNMA
Collateral Investment Agreement LOC)
4.05%, 07/07/97 18,200 18,200
New York City, New York Housing Development Corp.
Variable Rate Demand Special Obligation Revenue
Bonds (East 96th Street Project) Series
1990A/(Bank of Tokyo-Mitsubishi Ltd. LOC)
4.15%, 07/07/97 4,200 4,200
New York City, New York Industrial Development
Agency Floating Rate Revenue Bonds (White Plains
Auto)/(Societe Generale LOC)
4.05%, 07/07/97 200 200
New York City, New York Industrial Development
Agency Revenue Bonds (Brooklyn Navy Yard Co.)
Series 1995A/(Bank of America LOC)
4.20%, 07/07/97 17,400 17,400
New York City, New York Industrial Development
Agency Revenue Bonds (Brooklyn Navy Yard Co.)
Series 1995B/(Bank of America LOC)
4.15%, 07/07/97 2,500 2,500
New York City, New York Industrial Development
Authority Special Facility Revenue Bonds (Korean
Airlines Co. Project) Series 1997A/(Bankers
Trust LOC)
4.10%, 07/07/97 19,900 19,900
New York City, New York Municipal Water Finance
Authority Water & Sewer System Revenue Bonds
Series 1992C/(FGIC Insurance & FGIC SPA)
4.15%, 07/01/97 680 680
</TABLE>
98
<PAGE> 105
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
New York City, New York Municipal Water Finance
Authority Water & Sewer System Revenue Bonds
Series 1994G/(FGIC Insurance)
4.05%, 07/01/97 $ 1,000 $ 1,000
New York State Dormitory Authority Revenue Bonds
(Cornell University) Series 1990B/(Morgan
Guaranty Trust Co.--New York LOC)
4.00%, 07/01/97 200 200
New York State Dormitory Authority Revenue Bonds
(Masonic Hall Asylum)/(AMBAC Insurance & Credit
Local de France SBPA)
4.05%, 07/07/97 3,700 3,700
New York State Dormitory Authority Revenue Bonds
(New York Public Library) Series 1992B/(Canadian
Imperial Bank of Commerce LOC)
4.00%, 07/07/97 1,500 1,500
New York State Energy Research & Development
Authority Electric Facilities Adjustable Rate
Revenue Bonds (Long Island Lighting Co. Project)
Series 1993A/(Toronto-Dominion Bank LOC)
4.20%, 07/07/97 3,000 3,000
New York State Energy Research & Development
Authority Electric Facilities Adjustable Rate
Revenue Bonds (Long Island Lighting Co. Project)
Series 1993B/(Toronto-Dominion Bank LOC)
4.20%, 07/07/97 6,000 6,000
New York State Energy Research & Development
Authority Electric Facilities Adjustable Rate
Revenue Bonds (Long Island Lighting Co. Project)
Series 1994A/(Union Bank of Switzerland LOC)
4.15%, 07/07/97 5,000 5,000
New York State Energy Research & Development
Authority Pollution Control Revenue Bonds
(Central Hudson Gas & Electric Corp. Project)
Series 1985A/(Morgan Guaranty Trust Co.--New
York LOC)
3.95%, 07/07/97 10,000 10,000
New York State Energy Research & Development
Authority Pollution Control Revenue Bonds
(Niagara Mohawk Power Corp. Project) Series
88A/(Morgan Guaranty Trust Co.--New York LOC)
5.50%, 07/01/97 11,300 11,300
New York State Energy Research & Development
Authority Pollution Control Revenue Refunding
Bonds (New York Electric & Gas)/(Union Bank of
Switzerland LOC)
4.00%, 07/01/97 4,550 4,550
</TABLE>
99
<PAGE> 106
SCHWAB NEW YORK MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
New York State Energy Research & Development
Authority Pollution Control Revenue Refunding
Bonds (Orange & Rockland Utilities, Inc.
Project) Series 1994A/(FGIC Insurance & Societe
Generale SBPA)
4.05%, 07/07/97 $15,400 $ 15,400
New York State Environmental Facility Corp.
Adjustable Rate Tender Resource Recovery Revenue
Bonds (OFS Equity of Huntington, Inc.
Project)/(Union Bank of Switzerland LOC)
4.20%, 07/07/97 1,500 1,500
New York State Housing Finance Agency Revenue
Bonds (East 84th Street Project) Series
1995A/(Fleet Bank of New York LOC)
4.20%, 07/07/97 6,000 6,000
New York State Housing Finance Agency Revenue
Bonds (Mount Sinai School of Medicine) Series
1984A/(Sanwa Bank LOC)
3.80%, 07/07/97 9,500 9,500
New York State Housing Finance Agency Revenue
Bonds (Normandie Court II) Series 1987A/
(Bankers Trust Co. LOC)
4.10%, 07/07/97 4,900 4,900
New York State Housing Finance Agency Revenue
Bonds (Union Square South Housing)/(Bayerische
Hypotheken Und Wechsel Bank LOC)
4.05%, 07/07/97 18,000 18,000
New York State Housing Finance Agency Revenue
Bonds (West 50 Street Project) Series 97A/(Fleet
Bank of New York LOC)
4.20%, 07/07/97 9,000 9,000
New York State Job Development Authority Special
Purpose Bonds Series A-1 Thru A-25/(State of New
York Guaranty & Sumitomo Bank LOC)
4.15%, 07/07/97 5,015 5,015
New York State Local Government Assistance Corp.
Revenue Bonds Series 1993A/(Union Bank of
Switzerland & Credit Suisse LOC)
4.00%, 07/07/97 4,300 4,300
New York State Local Government Assistance Corp.
Revenue Bonds Series 1994B/(Credit Suisse &
Swiss Bank LOC)
4.05%, 07/07/97 400 400
New York State Local Government Assistance Corp.
Revenue Bonds Series 1995B/(Bank of Nova
Scotia LOC)
4.05%, 07/07/97 8,600 8,600
New York State Local Government Assistance Corp.
Revenue Bonds Series 1995G/(National Westminster
Bank LOC)
4.05%, 07/07/97 5,400 5,400
</TABLE>
100
<PAGE> 107
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
New York State Medical Care Facilities Financing
Agency Revenue Pooled Equipment Loan Program
Series 1/(Chemical Bank LOC)
4.10%, 07/07/97 $ 2,200 $ 2,200
Niagara County, New York Industrial Development
Agency Revenue Bonds (Allegheny Ludlum Steel
Co.) Series 1984/(PNC Bank LOC)
4.10%, 07/07/97 3,500 3,500
Niagara Falls, New York Bridge Commission Revenue
Bonds Series 1993A/(FGIC Insurance & Credit
Local De France SPA)
4.05%, 07/07/97 6,400 6,400
Schenectady, New York Industrial Development
Agency Revenue Bonds (Fortitech Holding Corp.
Project) Series A/(Fleet Bank of New York LOC)
4.35%, 07/07/97 1,400 1,400
St. Lawrence County, New York Industrial
Development Agency Environmental Improvement
Revenue Bonds (Reynolds Metals Project) Series
1995/(Royal Bank of Canada LOC)
4.20%, 07/07/97 4,000 4,000
Town of Islip, New York Industrial Development
Revenue Adjustable Magnum Realty (Creative Bath
Products)/(Chemical Bank LOC)
4.05%, 07/07/97 3,320 3,320
Triborough Bridge & Tunnel Authority, New York
Special Obligation Bridge Revenue Bonds Series
1994/(FGIC Insurance & FGIC SPA)
4.15%, 07/07/97 2,900 2,900
Yonkers, New York Industrial Development Agency
Civic Facilities Revenue Bonds (Consumers Union
Facility Project) Series 1989/(Industrial Bank
of Japan LOC)
3.95%, 07/07/97 1,500 1,500
Yonkers, New York Industrial Development Agency
Civic Facilities Revenue Bonds (Consumers Union
Facility Project) Series 1991/(Industrial Bank
of Japan LOC)
3.95%, 07/07/97 700 700
Yonkers, New York Industrial Development Agency
Civic Facilities Revenue Bonds (Consumers Union
Facility Project) Series 1994/(AMBAC Insurance &
Credit Local de France SBPA)
3.95%, 07/07/97 2,000 2,000
--------
TOTAL VARIABLE RATE OBLIGATIONS
(Cost $281,690) 281,690
--------
</TABLE>
101
<PAGE> 108
SCHWAB NEW YORK MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
BOND ANTICIPATION NOTES--9.0%(b)
Byram Hills, New York Central School District Bond
Anticipation Notes
3.75%, 05/08/98 $ 2,500 $ 2,510
Colonie, New York Bond Anticipation Notes Series B
3.75%, 04/17/98 2,052 2,060
East Hampton Township, New York Bond Anticipation
Notes Series 1997B
3.96%, 04/16/98 4,519 4,537
Nassau County, New York Bond Anticipation Notes
Series 1997A
3.69%, 08/15/97 4,800 4,803
3.58%, 08/15/97 10,000 10,008
Rochester, New York General Obligation Bond
Anticipation Notes Series 1996-97
3.76%, 10/30/97 14,000 14,033
--------
TOTAL BOND ANTICIPATION NOTES
(Cost $37,951) 37,951
--------
REVENUE BONDS--6.7%(b)
Municipal Acceptance Corp. for the City of New
York Revenue Bonds Series 66
4.01%, 07/01/97 600 600
New York State Dormitory Authority Revenue Bonds
(City University) Series A/(Escrowed to Maturity
with Government Securities)
3.55%, 07/01/97 1,800 1,836
New York State Housing Finance Agency Revenue
Bonds/(FSA Insurance)
3.54%, 11/01/97 8,000 8,013
New York State Medical Care Facilities Financing
Agency Revenue Bonds/(Escrowed to Maturity with
Government Securities)
3.40%, 08/15/97 2,000 2,053
New York State Single Family Housing Corp. Revenue
Bonds Series 87A/(Escrowed to Maturity with
Government Securities)
3.60%, 11/01/97 10,000 10,375
New York State Thruway Authority General Revenue
Bonds Series 97D
3.85%, 01/01/98 5,180 5,196
--------
TOTAL REVENUE BONDS
(Cost $28,073) 28,073
--------
</TABLE>
102
<PAGE> 109
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
TAX ANTICIPATION NOTES--5.6%(b)
Central Islip, New York Unified School District
Tax Anticipation Notes
3.90%, 06/30/98 $17,000 $ 17,098
New York City, New York Tax Anticipation Notes
Series H Subseries H-3/(Multiple Credit
Enhancements)
3.85%, 07/16/97 1,500 1,500
Suffolk County, New York Tax Anticipation Notes/
(National Westminster Bank PLC & Westdeutsche
Landesbanken LOC)
3.95%, 09/11/97 5,000 5,005
--------
TOTAL TAX ANTICIPATION NOTES
(Cost $23,603) 23,603
--------
TAX-EXEMPT COMMERCIAL PAPER--5.6%(b)
New York City, New York State Housing Development
Corp. Tax-Exempt Commercial Paper/(Credit Suisse
LOC)
3.85%, 10/16/97 8,400 8,400
New York State Environmental Quality Control
Tax-Exempt Commercial Paper/(Multiple Credit
Enhancements)
3.70%, 08/20/97 5,000 5,000
New York State Environmental Quality 86 Tax-Exempt
Commercial Paper Series 1997A/(Multiple Credit
Enhancements)
3.45%, 07/10/97 5,000 5,000
New York State Power Authority Tax-Exempt
Commercial Paper
3.65%, 08/07/97 3,000 3,000
3.70%, 08/08/97 2,000 2,000
--------
TOTAL TAX-EXEMPT COMMERCIAL PAPER
(Cost $23,400) 23,400
--------
MANDATORY PUT BONDS--2.9%(b)
New York State Energy Research & Development
Agency Pollution Control Revenue Bonds (Long
Island Lighting Co. Project) Series
1985B/(Deutsche Bank LOC)
3.60%, 03/01/98 12,000 12,000
--------
TOTAL MANDATORY PUT BONDS
(Cost $12,000) 12,000
--------
</TABLE>
103
<PAGE> 110
SCHWAB NEW YORK MUNICIPAL MONEY FUND
- ------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Par Value
------- --------
<S> <C> <C>
VARIABLE RATE TENDER OPTION BONDS--1.3%(a)(c)
New York State Dormitory Authority Revenue Bonds
(New York University Insured) (BTP-26)/(Automatic
Data Processing Inc. Tender Option & MBIA Insurance)
4.19%, 07/07/97 $ 5,375 $ 5,375
--------
TOTAL VARIABLE RATE TENDER OPTION BONDS
(Cost $5,375) 5,375
--------
TAX AND REVENUE ANTICIPATION NOTES--1.2%(b)
Puerto Rico Commonwealth Tax & Revenue
Anticipation Notes Series 1
3.43%, 07/30/97 5,000 5,002
--------
TOTAL TAX AND REVENUE ANTICIPATION NOTES
(Cost $5,002) 5,002
--------
GENERAL OBLIGATION BONDS--0.9%(b)
Montgomery County, New York General Obligation
Bonds/(FGIC Insurance)
3.89%, 06/15/98 400 404
New Rochelle, New York City School District
Unlimited General Obligation Bonds Series 96B
/(AMBAC Insurance)
3.50%, 12/15/97 1,450 1,462
New York City, New York General Obligation Bonds
Series 87D
4.00%, 08/01/97 1,000 1,023
Phelps-Clifton Springs, New York Consolidated
School District General Obligation Revenue
Bonds/(AMBAC Insurance & Escrowed to Maturity
with Government Securities)
3.78%, 06/15/98 1,025 1,042
--------
TOTAL GENERAL OBLIGATION BONDS
(Cost $3,931) 3,931
--------
TOTAL INVESTMENTS--100%,
(Cost $421,025) $421,025
========
</TABLE>
104
<PAGE> 111
- ------------------------------------------------------------------------------
NOTES TO SCHEDULE OF INVESTMENTS
For each security, cost (for financial reporting and federal income tax
purposes) and carrying value are the same.
(a) Variable rate securities. Interest rates vary periodically based on
current market rates. Rates shown are the effective rates as of the
report date. Dates shown represent the latter of the demand date or
next interest rate change date, which is considered the maturity date
for financial reporting purposes. For variable rate securities without
demand features, the next interest reset date is shown.
(b) Interest rates represent effective yield to put or call date at time of
purchase.
(c) Certain securities purchased by the Fund are private placement
securities exempt from registration by Section 4(2) of the Securities
Act of 1933. These securities generally are issued to institutional
investors, such as the Schwab Municipal Money Fund, Schwab California
Municipal Money Fund, and Schwab New York Municipal Money Fund. Any
resale by the Funds must be in an exempt transaction, normally to a
qualified institutional buyer. At June 30, 1997, the aggregate values
of private placement securities held by the Schwab Municipal Money
Fund, Schwab California Municipal Money Fund, and Schwab New York
Municipal Money Fund were $49,740,000, $8,195,000 and $5,375,000,
respectively, which represented 1.06%, 0.31% and 1.33%, respectively,
of the net assets of each Fund. All of these private placement
investments were determined by the Investment Manager to be liquid in
accordance with procedures adopted by the Board of Trustees.
(d) Security traded on a delayed-delivery basis. Payment and delivery is
scheduled for a future time, generally within two weeks of entering
into the transaction. The transaction is subject to market fluctuation
and to the risk that the value may be more or less than the purchase
price when the transaction was initiated. The Fund has set aside
sufficient investment securities as collateral for securities purchased
on a delayed-delivery basis.
(e) Certain securities cannot be resold to the general public without prior
registration under the Securities Act of 1933. If the security is
subsequently registered and resold, the issuers would typically bear
105
<PAGE> 112
the expense of all registrations at no cost to the fund. At June 30,
1997, the aggregate values of the restricted securities held by Schwab
Municipal Money Fund and Schwab California Municipal Money Fund were
$70,795,000 and $38,378,000, respectively, which represented 1.51% and
1.47%, respectively, of the net assets of each Fund. All of these
restricted investments were determined by the Investment Manager to be
illiquid in accordance with procedures adopted by the Board of
Trustees.
<TABLE>
<CAPTION>
Abbreviations
-------------
<S> <C>
AMBAC AMBAC Indemnity Corporation
FGIC Financial Guaranty Insurance Company
FHLB Federal Home Loan Bank
FNB First National Bank
FNMA Federal National Mortgage Association
FSA Financial Security Assurance
GNMA Government National Mortgage Association
LOC Letter of Credit
MBIA Municipal Bond Investors Assurance Corporation
N.R.U.-C.F.C. National Rural Utilities Cooperative
Financing Corporation
SBPA Standby Purchase Agreement
SLMA Student Loan Marketing Association
SPA Securities Purchase Agreement
</TABLE>
See accompanying Notes to Financial Statements.
106
<PAGE> 113
- ------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (in thousands)
June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Schwab Schwab
Schwab California New York
Municipal Municipal Municipal
Money Money Money
Fund Fund Fund
---------- ---------- ---------
<S> <C> <C> <C>
ASSETS
Investments, at value (Cost:
$4,900,999, $2,823,154 and $421,025,
respectively) $4,900,999 $2,823,154 $ 421,025
Cash 9,343 10,630 23
Interest receivable 25,952 20,301 2,855
Receivable for investments sold 37,004 -- --
Receivable for Fund shares sold 7,968 18,898 1,159
Deferred organization costs -- -- 15
Prepaid expenses 548 165 94
---------- ---------- ---------
Total assets 4,981,814 2,873,148 425,171
---------- ---------- ---------
LIABILITIES
Payable for:
Dividends 6,288 3,291 519
Investments purchased 272,915 251,130 17,098
Fund shares redeemed 3,089 8,147 1,785
Investment advisory and
administration fee 160 82 16
Transfer agency and shareholder
service fees 300 178 20
Other 587 295 108
---------- ---------- ---------
Total liabilities 283,339 263,123 19,546
---------- ---------- ---------
Net assets applicable to outstanding
shares $4,698,475 $2,610,025 $ 405,625
========== ========== =========
NET ASSETS CONSIST OF:
Paid-in-capital $4,701,193 $2,610,781 $ 405,641
Accumulated net realized loss on
investments sold (2,718) (756) (16)
---------- ---------- ---------
$4,698,475 $2,610,025 $ 405,625
========== ========== =========
PRICING OF SHARES
$0.00001 par value (unlimited shares
authorized) Outstanding Sweep
Shares 3,940,490 1,867,390 305,558
Outstanding Value Advantage Shares 760,703 743,391 100,083
---------- ---------- ---------
4,701,193 2,610,781 405,641
Net asset value, offering and
redemption price per each
Sweep and Value Advantage Share $ 1.00 $ 1.00 $ 1.00
</TABLE>
See accompanying Notes to Financial Statements.
107
<PAGE> 114
- ------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (in thousands)
Six months ended June 30, 1997 (Unaudited)
<TABLE>
<CAPTION>
Schwab Schwab
Schwab California New York
Municipal Municipal Municipal
Money Money Money
Fund Fund Fund
--------- ---------- ----------
<S> <C> <C> <C>
Interest income $86,440 $ 43,368 $6,651
------- ------ ------
Expenses:
Investment advisory and administration
fee 9,729 5,237 852
Transfer agency and shareholder service
fees:
Sweep Shares 9,062 4,148 656
Value Advantage Shares 829 752 98
Custodian fees 241 169 97
Registration fees 241 116 47
Professional fees 44 32 18
Shareholder reports 350 150 50
Trustees' fees 11 7 4
Amortization of deferred organization
costs -- -- 3
Insurance and other expenses 41 17 4
------- ------ ------
20,548 10,628 1,829
Less: expenses reduced and absorbed (see
Note 4) (5,541) (3,194) (623)
------- ------ ------
Total expenses incurred by Fund 15,007 7,434 1,206
------- ------ ------
Net investment income 71,433 35,934 5,445
Net realized loss on investments sold (393) (24) 0
------- ------ ------
Increase in net assets resulting from
operations $71,040 $ 35,910 $5,445
======= ====== ======
</TABLE>
See accompanying Notes to Financial Statements.
108
<PAGE> 115
- ------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (in thousands)
<TABLE>
<CAPTION>
Schwab California Schwab New York
Schwab Municipal Municipal Municipal
Money Fund Money Fund Money Fund
------------------------- ------------------------- -------------------------
Six months Six months Six months
ended Year ended Year ended Year
June 30, ended June 30, ended June 30, ended
1997 December 31, 1997 December 31, 1997 December 31,
(Unaudited) 1996 (Unaudited) 1996 (Unaudited) 1996
----------- ------------ ----------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income $ 71,433 $ 116,741 $ 35,934 $ 55,047 $ 5,445 $ 7,339
Net realized loss on
investments sold (393) (477) (24) (68) 0 (9)
----------- ------------ ----------- ----------- --------- --------
Increase in net assets
resulting from operations 71,040 116,264 35,910 54,979 5,445 7,330
----------- ------------ ----------- ----------- --------- --------
Dividends to shareholders
from net investment income:
Sweep Shares (60,703) (104,911) (26,603) (45,951) (4,213) (6,338)
Value Advantage Shares (10,730) (11,830) (9,331) (9,096) (1,232) (1,001)
----------- ------------ ----------- ----------- --------- --------
Total dividends to
shareholders (71,433) (116,741) (35,934) (55,047) (5,445) (7,339)
----------- ------------ ----------- ----------- --------- --------
Capital share transactions
(at $1.00 per share):
Proceeds from shares sold 8,340,903 13,705,095 4,026,160 6,230,933 700,918 979,381
Net asset value of shares
issued in reinvestment of
dividends 79,501 112,199 40,098 52,112 5,948 6,854
Less payments for shares
redeemed (8,198,535) (12,904,337) (3,779,807) (5,645,082) (638,536) (868,937)
----------- ------------ ----------- ----------- --------- --------
Increase in net assets from
capital share
transactions 221,869 912,957 286,451 637,963 68,330 117,298
----------- ------------ ----------- ----------- --------- --------
Total increase in net assets 221,476 912,480 286,427 637,895 68,330 117,289
Net assets:
Beginning of period 4,476,999 3,564,519 2,323,598 1,685,703 337,295 220,006
----------- ------------ ----------- ----------- --------- --------
End of period $ 4,698,475 $ 4,476,999 $ 2,610,025 $ 2,323,598 $ 405,625 $ 337,295
=========== ============ =========== =========== ========= ========
</TABLE>
See accompanying Notes to Financial Statements.
109
<PAGE> 116
- ------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
Six months ended June 30, 1997 (Unaudited)
1. DESCRIPTION OF THE FUNDS
The Schwab Municipal Money Fund, Schwab California Municipal Money Fund and
Schwab New York Municipal Money Fund (the "Funds"), are a series of The Charles
Schwab Family of Funds (the "Trust"), a no-load, open-end investment management
company organized as a Massachusetts business trust on October 20, 1989 and
registered under the Investment Company Act of 1940, as amended.
The Funds offer multiple classes of shares -- the Sweep Shares ("Sweep Shares"),
and the Value Advantage Shares ("Value Advantage Shares"). Both classes
represent interests in the same portfolio of investments of the respective Fund
and are substantially the same in all respects, except that the classes are
subject to different transfer agency and shareholder service fees (see Note 3),
investment minimums and certain other expenses.
In addition to the three Funds described above, the Trust also offers -- Schwab
Money Market Fund, Schwab Government Money Fund, Schwab U.S. Treasury Money
Fund, Schwab Value Advantage Money Fund(R), Schwab Institutional Advantage Money
Fund(R) and Schwab Retirement Money Fund(R). The assets of each series are
segregated and accounted for separately.
2. SIGNIFICANT ACCOUNTING POLICIES
The following significant accounting policies are in conformity with generally
accepted accounting principles for investment companies. The preparation of
financial statements in accordance with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates.
Security valuation -- Investments are stated at amortized cost which
approximates market value.
Security transactions, interest income and realized gains (losses) -- Security
transactions are accounted for on a trade date basis (date the order to buy or
sell is executed). Interest income is accrued daily and includes amortization of
premium on investments. Realized gains and losses from security transactions are
determined on an identified cost basis. Income and realized gains (losses) are
allocated daily to each class of shares of a Fund based on the value of settled
shares outstanding of each respective class.
110
<PAGE> 117
- ------------------------------------------------------------------------------
Deferred organization costs -- Costs incurred in connection with the
organization of the Funds are amortized on a straight-line basis over a
five-year period from each Funds' commencement of operations.
Dividends to shareholders -- Each Fund declares a daily dividend, equal to its
net investment income for that day, payable monthly. Dividends paid by a Fund
with respect to each class of shares are calculated in the same manner, at the
same time, and will be in the same amount except for the effect of expenses that
may be applied differently, as described below.
Expenses -- Expenses arising in connection with a Fund are charged directly to
that Fund. Expenses common to all series of the Trust are generally allocated to
each series in proportion to their relative net assets. Expenses attributable to
both classes of shares of a Fund are allocated daily to each class of that Fund
based on the value of settled shares outstanding of each respective class.
Transfer agency, shareholder service fees and certain other expenses which are
class specific, are calculated daily at the class level.
Federal income taxes -- It is each Fund's policy to meet the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its net investment income and realized net capital gains, if
any, to shareholders. Therefore, no federal income tax provision is required.
Each Fund is considered a separate entity for tax purposes.
3. TRANSACTIONS WITH AFFILIATES
Investment advisory and administration agreements -- The Trust has investment
advisory and administration agreements with Charles Schwab Investment
Management, Inc. (the "Investment Manager"). For advisory services and
facilities furnished, each Fund pays an annual fee, payable monthly, of 0.46% of
the first $1 billion of average daily net assets, 0.41% of the next $1 billion
and 0.40% of such assets in excess of $2 billion. The Investment Manager has
reduced a portion of its fee for the six months ended June 30, 1997 (see Note
4).
Transfer agency and shareholder service agreements -- The Trust has transfer
agency and shareholder service agreements with Charles Schwab & Co., Inc.
("Schwab"). For services provided under these agreements, Schwab receives an
annual fee, payable monthly, of 0.45% and 0.25% of each Fund's average daily net
assets of the Sweep Shares and Value Advantage Shares, respectively.
111
<PAGE> 118
- ------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
Schwab has reduced a portion of its fee for the six months ended June 30, 1997
(see Note 4).
Officers and trustees -- Certain officers and trustees of the Trust are also
officers and/or directors of the Investment Manager and/or Schwab. During the
six months ended June 30, 1997, the Trust made no direct payments to its
officers or trustees who are "interested persons" within the meaning of the
Investment Company Act of 1940, as amended. The Schwab Municipal Money Fund,
Schwab California Municipal Money Fund and Schwab New York Municipal Money Fund
incurred fees aggregating $22,000, related to the Trust's unaffiliated trustees.
4. EXPENSES REDUCED AND ABSORBED BY THE INVESTMENT MANAGER AND SCHWAB
The Investment Manager and Schwab reduced a portion of their fees in order to
limit each Fund's ratio of operating expenses to average net assets. For the six
months ended June 30, 1997, the total of such fees reduced by the Investment
Manager were $5,163,000, 2,985,000 and $522,000 for the Schwab Municipal Money
Fund, Schwab California Municipal Money Fund and Schwab New York Municipal Money
Fund, respectively, and the total of such fees reduced by Schwab were $378,000,
$209,000 and $101,000 for the Schwab Municipal Money Fund, Schwab California
Municipal Money Fund and Schwab New York Municipal Money Fund, respectively.
5. INVESTMENT TRANSACTIONS
Purchases, sales and maturities of investment securities during the six months
ended June 30, 1997, were as follows (in thousands):
<TABLE>
<CAPTION>
Schwab Schwab
Schwab California New York
Municipal Municipal Municipal
Money Fund Money Fund Money Fund
---------- ---------- ----------
<S> <C> <C> <C>
Purchases $6,251,587 $3,222,043 $420,965
Proceeds of sales and
maturities $5,939,851 $2,717,148 $336,146
</TABLE>
112
<PAGE> 119
- ------------------------------------------------------------------------------
6. CAPITAL SHARE TRANSACTIONS
Each Fund offers two classes of shares: Sweep Shares and Value Advantage Shares.
Shares of each class represent interests in the same portfolio of investments of
the Fund. Transactions in capital shares were as follows for the six months
ended June 30, 1997 and for the year ended December 31, 1996, (in thousands):
<TABLE>
<CAPTION>
Schwab California Schwab New York
Schwab Municipal Money Fund Municipal Money Fund Municipal Money Fund
--------------------------- --------------------------- ---------------------------
Six months Six months Six months
ended Year ended ended Year ended ended Year ended
June 30, 1997 December 31, June 30, 1997 December 31, June 30, 1997 December 31,
------------- ------------ ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Proceeds from shares
sold:
Sweep Shares $ 7,651,378 $12,710,212 $ 3,360,894 $ 5,448,674 $ 599,077 $ 868,824
Value Advantage Shares 689,525 994,883 665,266 782,259 101,841 110,557
----------- ------------ ----------- ----------- --------- ---------
Total 8,340,903 13,705,095 4,026,160 6,230,933 700,918 979,381
----------- ------------ ----------- ----------- --------- ---------
Net asset value of
shares issued in
reinvestment of
dividends:
Sweep Shares 68,250 102,508 30,189 44,907 4,647 6,081
Value Advantage Shares 11,251 9,691 9,909 7,205 1,301 773
----------- ------------ ----------- ----------- --------- ---------
Total 79,501 112,199 40,098 52,112 5,948 6,854
----------- ------------ ----------- ----------- --------- ---------
Less payments for shares
redeemed:
Sweep Shares (7,650,342) (12,347,201) (3,340,527) (5,255,105) (568,792) (809,149)
Value Advantage Shares (548,193) (557,136) (439,280) (389,977) (69,744) (59,788)
----------- ------------ ----------- ----------- --------- ---------
Total (8,198,535) (12,904,337) (3,779,807) (5,645,082) (638,536) (868,937)
----------- ------------ ----------- ----------- --------- ---------
Total increase in net
assets from capital
share transactions $ 221,869 $ 912,957 $ 286,451 $ 637,963 $ 68,330 $ 117,298
=========== ============ =========== =========== ========= =========
</TABLE>
113
<PAGE> 120
- ------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
7. FINANCIAL HIGHLIGHTS
For a share outstanding throughout each period:
<TABLE>
<CAPTION>
Schwab Municipal Money Fund
Sweep Shares
-------------------------------------------------------------------------
Six months
ended
June 30, 1997 Year ended December 31,
(Unaudited) 1996 1995 1994 1993 1992
------------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at
beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
- --------------------------
operations
----------
Net investment income 0.02 0.03 0.03 0.02 0.02 0.03
Net realized and
unrealized gain (loss)
on investments -- -- -- -- -- --
----------- ---------- ---------- ---------- ---------- ----------
Total from investment
operations 0.02 0.03 0.03 0.02 0.02 0.03
Less distributions
- ------------------
Dividends from net
investment income (0.02) (0.03) (0.03) (0.02) (0.02) (0.03)
Distributions from
realized gain on
investments -- -- -- -- -- --
----------- ---------- ---------- ---------- ---------- ----------
Total distributions (0.02) (0.03) (0.03) (0.02) (0.02) (0.03)
------ ---------- ---------- ---------- ---------- ----------
Net asset value at end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== ========== ========== ========== ========== ==========
Total return (not
- ------------
annualized) 1.51% 2.92% 3.30% 2.32% 1.93% 2.49%
- ------------------------
Ratios/Supplemental data
- ------------------------
Net assets, end of period
(000s) $ 3,937,867 $3,868,919 $3,403,837 $3,015,951 $2,423,317 $1,744,903
Ratio of expenses to
average net assets+ 0.67%* 0.66% 0.66% 0.65% 0.63% 0.63%
Ratio of net investment
income to average net
assets+ 3.01%* 2.89% 3.25% 2.31% 1.92% 2.45%
</TABLE>
- ---------------
+ The information contained in the above table is based on actual expenses for
the periods, after giving effect to the portion of expenses reduced and
absorbed by the Investment Manager and Schwab. Had these expenses not been
reduced and absorbed, the Fund's expense and net investment income ratios
would have been:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Ratio of expenses to
average net assets 0.90%* 0.90% 0.91% 0.91 0.93% 0.94%
Ratio of net investment
income to average net
assets 2.78%* 2.65% 3.00% 2.05% 1.62% 2.14%
</TABLE>
* Annualized
114
<PAGE> 121
- ------------------------------------------------------------------------------
7. FINANCIAL HIGHLIGHTS (CONTINUED)
For a share outstanding throughout each period:
<TABLE>
<CAPTION>
Schwab Municipal Money Fund
Value Advantage Shares
---------------------------------------
Six months
ended
June 30, Year ended Period ended
1997 December 31, December 31,
(Unaudited) 1996 1995 1
----------- ------------ ------------
<S> <C> <C> <C>
Net asset value at beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations
- ---------------------------------
Net investment income 0.02 0.03 0.02
Net realized and unrealized gain (loss) on investments -- -- --
--------- -------- --------
Total from investment operations 0.02 0.03 0.02
Less distributions
- ------------------
Dividends from net investment income (0.02) (0.03) (0.02)
Distributions from realized gain on investments -- -- --
--------- -------- --------
Total distributions (0.02) (0.03) (0.02)
--------- -------- --------
Net asset value at end of period $ 1.00 $ 1.00 $ 1.00
========= ======== ========
Total return (not annualized) 1.61% 3.14% 1.68%
- ------------
Ratios/Supplemental data
- ------------------------
Net assets, end of period (000s) $ 760,608 $608,080 $160,682
Ratio of expenses to average net assets+ 0.46%* 0.45% 0.45%*
Ratio of net investment income to average net assets+ 3.24%* 3.10% 3.50%*
</TABLE>
- ------------
+ The information contained in the above table is based on actual expenses for
the periods, after giving effect to the portion of expenses reduced and
absorbed by the Investment Manager and Schwab. Had these expenses not been
reduced and absorbed, the Fund's expense and net investment income ratios
would have been:
<TABLE>
<S> <C> <C> <C>
Ratio of expenses to average net assets 0.73%* 0.75% 0.95%*
Ratio of net investment income to average net assets 2.97%* 2.80% 3.00%*
</TABLE>
1 Period from July 7, 1995 (commencement of operations) to December 31, 1995.
* Annualized
115
<PAGE> 122
- ------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
7. FINANCIAL HIGHLIGHTS (CONTINUED)
For a share outstanding throughout each period:
<TABLE>
<CAPTION>
Schwab California Municipal Money Fund
Sweep Shares
-----------------------------------------------------------------------
Six months
ended
June 30, 1997 Year ended December 31,
(Unaudited) 1996 1995 1994 1993 1992
------------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning
of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
- ----------------------
operations
----------
Net investment income 0.01 0.03 0.03 0.02 0.02 0.02
Net realized and gain (loss)
on investments -- -- -- -- -- --
----------- ---------- ---------- ---------- ---------- --------
Total from investment
operations 0.01 0.03 0.03 0.02 0.02 0.02
Less distributions
- ------------------
Dividends from net
investment income (0.01) (0.03) (0.03) (0.02) (0.02) (0.02)
Distributions from gain on
investments -- -- -- -- -- --
----------- ---------- ---------- ---------- ---------- --------
Total distributions (0.01) (0.03) (0.03) (0.02) (0.02) (0.02)
----------- ---------- ---------- ---------- ---------- --------
Net asset value at end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== ========== ========== ========== ========== ========
Total return (not annualized) 1.44% 2.80% 3.20% 2.26% 1.91% 2.35%
- ------------
Ratios/Supplemental data
- ------------------------
Net assets, end of period
(000s) $ 1,866,651 $1,816,112 $1,577,695 $1,293,883 $1,062,042 $691,176
Ratio of expenses to average
net assets+ 0.66%* 0.65% 0.65% 0.64% 0.63% 0.63%
Ratio of net investment
income to average net
assets+ 2.89%* 2.77% 3.15% 2.25% 1.89% 2.31%
</TABLE>
- ---------------
+ The information contained in the above table is based on actual expenses for
the periods, after giving effect to the portion of expenses reduced and
absorbed by the Investment Manager and Schwab. Had these expenses not been
reduced and absorbed, the Fund's expense and net investment income ratios
would have been:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Ratio of expenses to
average net assets 0.91%* 0.92% 0.94% 0.94% 0.96% 0.97%
Ratio of net investment
income to average net
assets 2.63%* 2.50% 2.86% 1.95% 1.56% 1.97%
</TABLE>
* Annualized
116
<PAGE> 123
- ------------------------------------------------------------------------------
7. FINANCIAL HIGHLIGHTS (CONTINUED)
For a share outstanding throughout each period:
<TABLE>
<CAPTION>
Schwab California Municipal Money Fund
Value Advantage Shares
---------------------------------------
Six months
ended
June 30, Year ended Period ended
1997 December 31, December 31,
(Unaudited) 1996 1995 1
----------- ------------ ------------
<S> <C> <C> <C>
Net asset value at beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations
- ---------------------------------
Net investment income 0.02 0.03 0.01
Net realized and unrealized gain (loss) on investments -- -- --
--------- -------- --------
Total from investment operations 0.02 0.03 0.01
Less distributions
- ------------------
Dividends from net investment income (0.02) (0.03) (0.01)
Distributions from realized gain on investments -- -- --
--------- -------- --------
Total distributions (0.02) (0.03) (0.01)
--------- -------- --------
Net asset value at end of period $ 1.00 $ 1.00 $ 1.00
========= ======== ========
Total return (not annualized) 1.54% 3.01% 0.84%
- ------------
Ratios/Supplemental data
- ------------------------
Net assets, end of period (000s) $ 743,374 $507,486 $108,008
Ratio of expenses to average net assets+ 0.46%* 0.45% 0.45%*
Ratio of net investment income to average net assets+ 3.10%* 2.98% 3.48%*
</TABLE>
- ---------------
+ The information contained in the above table is based on actual expenses for
the periods, after giving effect to the portion of expenses reduced and
absorbed by the Investment Manager and Schwab. Had these expenses not been
reduced and absorbed, the Fund's expense and net investment income ratios
would have been:
<TABLE>
<S> <C> <C> <C>
Ratio of expenses to average net assets 0.73%* 0.77% 1.04%*
Ratio of net investment income to average net assets 2.83%* 2.66% 2.89%*
</TABLE>
1 Period from October 3, 1995 (commencement of operations) to December 31,
1995.
* Annualized
117
<PAGE> 124
- ------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
7. FINANCIAL HIGHLIGHTS (CONTINUED)
For a share outstanding throughout each period:
<TABLE>
<CAPTION>
New York Municipal Money Fund
Sweep Shares
---------------------------------------
Six months
ended
June 30, Year ended Period ended
1997 December 31, December 31,
(Unaudited) 1996 1995 1
----------- ------------ ------------
<S> <C> <C> <C>
Net asset value at beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations
- ---------------------------------
Net investment income 0.01 0.03 0.03
Net realized and unrealized gain(loss) on investments -- -- --
--------- -------- --------
Total from investment operations 0.01 0.03 0.03
Less distributions
- ------------------
Dividends from net investment income (0.01) (0.03) (0.03)
Distributions from realized gain on investments -- -- --
--------- -------- --------
Total distributions (0.01) (0.03) (0.03)
--------- -------- --------
Net asset value at end of period $ 1.00 $ 1.00 $ 1.00
========= ======== ========
Total return (not annualized) 1.44% 2.74% 2.75%
- ------------
Ratios/Supplemental data
- ------------------------
Net assets, end of period (000s) $ 305,544 $270,612 $204,863
Ratio of expenses to average net assets+ 0.70%* 0.69% 0.63%*
Ratio of net investment income to average net assets+ 2.89%* 2.71% 3.20%*
</TABLE>
- ---------------
+ The information contained in the above table is based on actual expenses for
the periods, after giving effect to the portion of expenses reduced and
absorbed by the Investment Manager and Schwab. Had these expenses not been
reduced and absorbed, the Fund's expense and net investment income ratios
would have been:
<TABLE>
<S> <C> <C> <C>
Ratio of expenses to average net assets 1.02%* 1.04 1.04%*
Ratio of net investment income to average net assets 2.57%* 2.36% 2.79%*
</TABLE>
1 Period from February 27, 1995 (commencement of operations) to December 31,
1995.
* Annualized
118
<PAGE> 125
- ------------------------------------------------------------------------------
7. FINANCIAL HIGHLIGHTS (CONTINUED)
For a share outstanding throughout each period:
<TABLE>
<CAPTION>
New York Municipal Money Fund
Value Advantage Shares
---------------------------------------
Six months
ended
June 30, Year ended Period ended
1997 December 31, December 31,
(Unaudited) 1996 1995 1
----------- ------------ ------------
<S> <C> <C> <C>
Net asset value at beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations
- ---------------------------------
Net investment income 0.02 0.03 0.02
Net realized and unrealized gain(loss) on investments -- -- --
--------- -------- --------
Total from investment operations 0.02 0.03 0.02
Less distributions
- ------------------
Dividends from net investment income (0.02) (0.03) (0.02)
Distributions from realized gain on investments -- -- --
--------- -------- --------
Total distributions (0.02) (0.03) (0.02)
--------- -------- --------
Net asset value at end of period $ 1.00 $ 1.00 $ 1.00
========= ======== ========
Total return (not annualized) 1.56% 2.99% 1.62%
- ------------
Ratios/Supplemental data
- ------------------------
Net assets, end of period (000s) $ 100,081 $ 66,683 $ 15,143
Ratio of expenses to average net assets+ 0.46%* 0.45% 0.45%*
Ratio of net investment income to average net assets+ 3.13%* 2.98% 3.42%*
</TABLE>
- ---------------
+ The information contained in the above table is based on actual expenses for
the periods, after giving effect to the portion of expenses reduced and
absorbed by the Investment Manager and Schwab. Had these expenses not been
reduced and absorbed, the Fund's expense and net investment income ratios
would have been:
<TABLE>
<S> <C> <C> <C>
Ratio of expenses to average net assets 0.86%* 1.01% 1.81%*
Ration of net investment income to average net assets 2.73%* 2.42% 2.06%*
</TABLE>
1 Period from July 7, 1995 (commencement of operations) to December 31, 1995.
* Annualized
119
<PAGE> 126
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A SCHWAB REPRESENTATIVE WILL BE HAPPY TO ASSIST YOU.
<PAGE> 127
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<PAGE> 128
THIS SPACE RESERVED FOR YOUR COMMENTS AND QUESTIONS.
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<PAGE> 129
THIS SPACE RESERVED FOR YOUR COMMENTS AND QUESTIONS.
A SCHWAB REPRESENTATIVE WILL BE HAPPY TO ASSIST YOU.
<PAGE> 130
THIS SPACE RESERVED FOR YOUR COMMENTS AND QUESTIONS.
A SCHWAB REPRESENTATIVE WILL BE HAPPY TO ASSIST YOU.
<PAGE> 131
SCHWABFUNDS FAMILY(R)
The SchwabFunds Family includes a variety of funds to help meet your investment
needs. You can diversify your portfolio in a single step with our asset
allocation funds. Or you can customize your portfolio with a combination of our
stock funds as well as our taxable and tax-advantaged bond and money funds.
SCHWAB ASSET ALLOCATION FUNDS
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SCHWAB MONEY MARKET FUNDS
Schwab offers an array of money market funds* that seek high current income with
safety and liquidity. Choose from taxable or tax-advantaged alternatives. Many
can be linked to your Schwab account to "sweep" cash balances automatically when
you're between investments. Or, for your larger cash reserves, choose one of our
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Please call 1-800-435-4000 for a free prospectus and brochure for any of the
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Each prospectus provides more complete information, including charges and
expenses. Please read it carefully before investing.
This report must be preceded or accompanied by a current prospectus.
*Investments in money market funds are neither insured nor guaranteed by the
U.S. government, and there is no assurance that the funds will be able to
maintain a stable share price of $1.
<PAGE> 132
--------------
[SCHWABFUNDS FAMILY(R) LOGO] BULK RATE
U.S. POSTAGE
PAID
101 Montgomery Street CHARLES SCHWAB
San Francisco, California 94104 --------------
INVESTMENT ADVISOR
Charles Schwab Investment Management, Inc.
101 Montgomery Street, San Francisco, CA 94104
DISTRIBUTOR
Charles Schwab & Co., Inc.
101 Montgomery Street, San Francisco, CA 94104
This report is not authorized for distribution to prospective investors unless
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