<PAGE> 1
IMPORTANT NOTICE
REGARDING DELIVERY OF
SHAREHOLDER DOCUMENTS
SCHWAB
EQUITY INDEX FUNDS
October 31, 2000
Annual Report enclosed
SCHWAB S&P 500 FUND
SCHWAB 1000 FUND(R)
SCHWAB SMALL-CAP INDEX FUND(R)
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM)
SCHWAB INTERNATIONAL INDEX FUND(R)
[CHARLESSCHWAB LOGO]
<PAGE> 2
IMPORTANT NOTICE REGARDING DELIVERY OF
SHAREHOLDER DOCUMENTS
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only one copy of shareholder documents, including prospectuses and shareholder
reports, to fund investors with multiple accounts at the same residential or
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INDEFINITELY UNLESS YOU INSTRUCT US OTHERWISE.
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<PAGE> 3
SCHWAB
EQUITY INDEX FUNDS
October 31, 2000
Annual Report
[Photo of Two Men Talking]
SCHWAB S&P 500 FUND
SCHWAB 1000 FUND(R)
SCHWAB SMALL-CAP INDEX FUND(R)
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM)
SCHWAB INTERNATIONAL INDEX FUND(R)
[CHARLESSCHWAB LOGO]
<PAGE> 4
[CHARLES SCHWAB PHOTO]
Dear Shareholder,
We're pleased to bring you the first report for these funds that uses our new
"plain English" format. This format is part of a major initiative to make
SchwabFunds(R) materials easier to use.
We've given the report a simpler organization and a new look. Our goal has been
to focus on presenting information clearly and explaining what it means to
shareholders.
The most significant change is the new section on how to read and understand the
report's financial data. We've even found ways to make the financial statements
and notes more accessible. We will continue to actively look for ways to improve
these reports even further.
We hope you find this report helpful and we welcome your feedback. Thank you for
choosing SchwabFunds.
Sincerely,
/s/ Charles Schwab
--------------------------------
Charles Schwab
SCHWAB
EQUITY INDEX
FUNDS
ANNUAL REPORT
November 1, 1999 - October 31, 2000
1 Market Overview
5 Schwab S&P 500 Fund
For the first time in five years, large-cap stocks did not lead the
market.
23 Schwab 1000 Fund(R)
Exposure to mid-cap stocks helped the fund weather a shifting market
environment.
46 Schwab Small-Cap Index Fund(R)
Small-cap stocks had a highly volatile year, but ended the report
period ahead of mid- and large-cap stocks.
69 Schwab Total Stock Market Index Fund(TM)
Factors affecting performance included evidence of a slowing economy
and exposure to a wide range of market capitalizations.
116 Schwab International Index Fund(R)
While foreign stocks performed adequately when measured in local
currencies, a rising dollar changed the picture for American investors.
131 Financial Notes
136 Proxy Results
_______________________________________________________________________
139 HOW TO READ THIS REPORT
An illustrated guide to the financials, along with a glossary.
<PAGE> 5
MARKET OVERVIEW
GROWTH PERIOD IS THE LONGEST IN U.S. HISTORY.
As of October 31, 2000, U.S. economic expansion was in the middle of its tenth
year, marking the longest period of continuous growth in U.S. history. The main
force behind the expansion has been high levels of consumer spending, fueled by
increases in personal income, personal wealth and consumer confidence.
The pace of economic growth remained robust through the second quarter of 2000,
then moderated somewhat in the third quarter, in part due to reduced government
spending. Actual Q3 growth was lower than many analysts had expected.
Although energy prices soared, inflation still appears to remain in check. The
GDP price deflator, a widely used inflation indicator, declined slightly from
2.4% in the second quarter to 2.0% in the third quarter. Source: Bloomberg L.P.
PRODUCTIVITY EMERGES AS A KEY FACTOR.
[PHOTO OF ASSEMBLY LINE]
In recent years, the Federal Reserve Bank (the Fed) demonstrated its resolve to
moderate the pace of the economy's growth by raising short-term interest rates
(since June 1999, it has raised these rates six times). The Fed has voiced
concern that increases in wages could outpace gains in productivity, forcing
companies to boost prices and potentially sparking inflation.
ASSET CLASS PERFORMANCE COMPARISON % returns during the report period
This graph compares the performance of four widely used measures of securities
market performance, including U.S. stocks and bonds and international stocks.
[LINE GRAPH]
<TABLE>
<CAPTION>
LEHMAN BROTHERS U.S.
AGGREGATE MSCI-EAFE(R) RUSSELL 2000(R) S&P 500(R)
BOND INDEX INDEX INDEX INDEX
---------- ------- ----- -----
<S> <C> <C> <C> <C>
11/5/99 0.0061 0.005 0.0323 0.0054
11/12/99 0.0073 0.02 0.0495 0.0244
11/19/99 0.0032 0.039 0.0762 0.0435
11/26/99 0.0011 0.052 0.0708 0.0395
12/3/99 0.0015 0.053 0.0843 0.0522
12/10/99 0.0078 0.067 0.0894 0.041
12/17/99 -0.003 0.068 0.0889 0.0439
12/24/99 -0.0061 0.107 0.1268 0.0713
12/31/99 -0.0051 0.126 0.1796 0.0804
1/7/00 -0.0057 0.074 0.1415 0.06
1/14/00 -0.0103 0.101 0.1867 0.0774
1/21/00 -0.0119 0.076 0.2483 0.0599
1/28/00 -0.0052 0.071 0.1801 0.0002
2/4/00 -0.0039 0.093 0.2292 0.0481
2/11/00 -0.0068 0.1 0.2568 0.0207
2/18/00 -0.0015 0.083 0.277 -0.0095
2/25/00 0.005 0.092 0.3029 -0.0189
3/3/00 0.0068 0.115 0.4004 0.0381
3/10/00 0.0048 0.114 0.4137 0.0277
3/17/00 0.0118 0.101 0.3458 0.0788
3/24/00 0.0105 0.123 0.3449 0.1251
3/31/00 0.0168 0.121 0.2632 0.1049
4/7/00 0.0249 0.11 0.2726 0.118
4/14/00 0.0242 0.071 0.064 0.0002
4/21/00 0.0233 0.062 0.1297 0.0577
4/28/00 0.0138 0.061 0.1872 0.0717
5/5/00 -0.0004 0.057 0.203 0.0571
5/12/00 -0.0017 0.046 0.1521 0.0485
5/19/00 0.0003 0.008 0.1258 0.0381
5/26/00 0.0112 0.014 0.0738 0.0168
6/2/00 0.023 0.081 0.2045 0.0916
6/9/00 0.0262 0.079 0.2287 0.0766
6/16/00 0.0349 0.075 0.2075 0.0822
6/23/00 0.0253 0.065 0.2002 0.0652
6/30/00 0.0344 0.073 0.2155 0.0757
7/7/00 0.0391 0.083 0.2406 0.0937
7/14/00 0.0376 0.079 0.2748 0.1166
7/21/00 0.0434 0.055 0.228 0.0946
7/28/00 0.0433 0.02 0.152 0.0501
8/4/00 0.0513 0.016 0.1839 0.0827
8/11/00 0.0531 0.031 0.2002 0.0893
8/18/00 0.0544 0.039 0.2129 0.104
8/25/00 0.0584 0.046 0.2359 0.115
09/01/00 0.0616 0.057 0.2758 0.127
9/8/00 0.0606 0.014 0.2598 0.1075
9/15/00 0.0588 -0.009 0.2506 0.0862
9/22/00 0.0613 -0.024 0.2224 0.0735
9/29/00 0.0657 -0.017 0.2293 0.0653
10/6/00 0.0654 -0.02 0.1579 0.0448
10/13/00 0.0692 -0.051 0.1332 0.019
10/20/00 0.0749 -0.052 0.15 0.0361
10/27/00 0.0736 -0.037 0.1321 0.0233
10/31/00 0.073 -0.029 0.1741 0.0609
</TABLE>
These figures assume dividends and distributions were reinvested. Index figures
don't include trading and management costs, which would lower performance.
Indices are unmanaged and you can't invest in them directly. Remember that past
performance isn't an indication of future results. Data source: Charles Schwab &
Co., Inc. (Schwab).
1
<PAGE> 6
MARKET OVERVIEW Continued
Productivity gains are important because they enable companies to achieve
greater output for every dollar spent for labor costs. Spurred mainly by
technological advances, productivity grew at 4.0% during the first half of 2000
and 3.3% during the third quarter (these figures include all economic sectors
except farming). However, third quarter productivity gains were partially offset
by a 2.5% increase in unit labor costs -- costs that had declined in the
previous quarter. Source: Bloomberg L.P.
UNEMPLOYMENT HITS NEW LOWS, YET INFLATION REMAINS AT BAY.
The unemployment rate has been trending downward for years. In April it fell
below 4% -- the lowest level in 30 years and one previously considered
improbable without high inflation.
[PHOTO OF WELDER]
Overall, labor markets continue to be extremely tight, and there has been
evidence in some regions of labor shortages driving up wages. In spite of these
regional trends, overall increases in prices and wages during the report period
were relatively modest, due in part to strong productivity gains. However, an
upturn in labor costs may make the Fed more sensitive to other potential signs
of inflation.
STOCKS STUMBLE, RECOVER; MOST BONDS POST HEALTHY RETURNS.
U.S. equities, as measured by the major indices (chart, page 1) had positive
returns for the report period. By historical standards, they also remained
highly valued (P/E chart, page 4).
FIVE FACTORS AND THEIR EFFECTS ON THESE FUNDS.
The following charts show recent figures for four common measures of the state
of the U.S. economy and the stock market, as well as one measure of
international stock performance.
While the relationship of each of these factors to the
performance of the funds is complex, the captions over each chart and the
discussion above include analysis of how we believe these factors may have
influenced market behavior during the report period.
REAL GDP GROWTH
Annualized growth rate for each quarter shown
The U.S. economy has grown steadily for more than nine years. Real GDP grew at a
2.4% annualized rate in Q3 2000 -- slower than the 5.2% for the first half of
the year.
[BAR CHART]
<TABLE>
<S> <C>
Dec-90 -3.2
Mar-91 -2
Jun-91 2.3
Sep-91 1
Dec-91 2.2
Mar-92 3.8
Jun-92 3.8
Sep-92 3.1
Dec-92 5.4
Mar-93 -0.1
Jun-93 2.5
Sep-93 1.8
Dec-93 6.2
Mar-94 3.4
Jun-94 5.7
Sep-94 2.2
Dec-94 5
Mar-95 1.5
Jun-95 0.8
Sep-95 3.1
Dec-95 3.2
Mar-96 2.9
Jun-96 6.8
Sep-96 2
Dec-96 4.6
Mar-97 4.4
Jun-97 5.9
Sep-97 4.2
Dec-97 2.8
Mar-98 6.5
Jun-98 2.9
Sep-98 3.4
Dec-98 5.6
Mar-99 3.5
Jun-99 2.5
Sep-99 5.7
Dec-99 8.3
Mar-00 4.8
Jun-00 5.6
Sep-00 2.4
</TABLE>
Gross domestic product (GDP), a broad measure of the goods and services produced
in the United States during a given time period, is a prime indicator of the
health of the country's economy. Typically, stock investors see increases in GDP
as a positive, since it indicates stronger demand, production and corporate
earnings. The figures shown here are adjusted for inflation.
Data source: Bloomberg L.P.
2
<PAGE> 7
________________________________________________________________________________
"Old economy" stocks and value stocks regained popularity as many newer company
stocks fell.
________________________________________________________________________________
However, the report period saw extreme volatility in the stock market,
particularly for U.S. stocks. In March and April, the P/E for the Nasdaq 100
Index lost one-third of its value in just a two-week period. (The Nasdaq 100
Index reflects 100 of the largest Nasdaq companies across major industry groups,
including computers, telecommunications, retail/wholesale and biotechnology, but
excluding financial companies.) Volatility continued through the end of the
report period as investors shifted their focus from hard-hit sectors such as
technology to undervalued and established companies.
Outside the U.S., stocks were held back by uncertainty over oil prices and
corporate earnings. For U.S. investors, the continued rise of the dollar against
the euro and yen was a factor as well, because it eroded the dollar value of
foreign stocks.
A major factor for bonds during the report period was the U.S. Treasury's
decision to use some of the budget surplus to buy back its own bonds. This
created a major change in the picture for supply and demand of bonds, and
resulted in an inverted yield curve (a situation where short-term bonds actually
pay higher yields than long-term
[PHOTO OF STOCK EXCHANGE]
U.S. UNEMPLOYMENT RATE
Adjusted for seasonal variations
Unemployment hit a three-decade low of 3.9% in April. Although it trended up to
4.1% during the summer months, it closed the reporting period back at 3.9%.
[LINE GRAPH]
<TABLE>
<S> <C>
Sep-90 5.9
Oct-90 5.9
Nov-90 6.2
Dec-90 6.3
Jan-91 6.4
Feb-91 6.6
Mar-91 6.8
Apr-91 6.7
May-91 6.9
Jun-91 6.9
Jul-91 6.8
Aug-91 6.9
Sep-91 6.9
Oct-91 7
Nov-91 7
Dec-91 7.3
Jan-92 7.3
Feb-92 7.4
Mar-92 7.4
Apr-92 7.4
May-92 7.6
Jun-92 7.8
Jul-92 7.7
Aug-92 7.6
Sep-92 7.6
Oct-92 7.3
Nov-92 7.4
Dec-92 7.4
Jan-93 7.3
Feb-93 7.1
Mar-93 7
Apr-93 7.1
May-93 7.1
Jun-93 7
Jul-93 6.9
Aug-93 6.8
Sep-93 6.7
Oct-93 6.8
Nov-93 6.6
Dec-93 6.5
Jan-94 6.8
Feb-94 6.6
Mar-94 6.5
Apr-94 6.4
May-94 6.1
Jun-94 6.1
Jul-94 6.3
Aug-94 6
Sep-94 5.8
Oct-94 5.8
Nov-94 5.6
Dec-94 5.5
Jan-95 5.6
Feb-95 5.4
Mar-95 5.4
Apr-95 5.8
May-95 5.6
Jun-95 5.6
Jul-95 5.7
Aug-95 5.7
Sep-95 5.6
Oct-95 5.5
Nov-95 5.6
Dec-95 5.6
Jan-96 5.7
Feb-96 5.5
Mar-96 5.5
Apr-96 5.5
May-96 5.6
Jun-96 5.3
Jul-96 5.5
Aug-96 5.1
Sep-96 5.2
Oct-96 5.2
Nov-96 5.4
Dec-96 5.4
Jan-97 5.3
Feb-97 5.3
Mar-97 5.2
Apr-97 5
May-97 4.9
Jun-97 5
Jul-97 4.8
Aug-97 4.8
Sep-97 4.9
Oct-97 4.7
Nov-97 4.6
Dec-97 4.7
Jan-98 4.7
Feb-98 4.6
Mar-98 4.7
Apr-98 4.3
May-98 4.4
Jun-98 4.5
Jul-98 4.5
Aug-98 4.5
Sep-98 4.5
Oct-98 4.5
Nov-98 4.4
Dec-98 4.4
Jan-99 4.3
Feb-99 4.4
Mar-99 4.2
Apr-99 4.3
May-99 4.2
Jun-99 4.3
Jul-99 4.3
Aug-99 4.2
Sep-99 4.2
Oct-99 4.1
Nov-99 4.1
Dec-99 4.1
Jan-00 4
Feb-00 4.1
Mar-00 4.1
Apr-00 3.9
May-00 4.1
Jun-00 4
Jul-00 4
Aug-00 4.1
Sep-00 3.9
Oct-00 3.9
</TABLE>
This measures the portion of the U.S. labor force that is unemployed and is
either seeking a job or waiting to return to one. Low unemployment often
accompanies prosperity and is generally a positive factor for investors,
although very low unemployment may boost inflation as employers raise pay to
compete for workers. Rising unemployment may mean a softening economy.
Data source: Bloomberg L.P.
MEASURES OF INFLATION
Annualized figures for the Consumer Price Index (monthly) and Employment Cost
Index (quarterly)
CPI was up 3.4% for the 12 months ended October 31, 2000 (2.5% if food and
energy are excluded). ECI rose 4.3% for the 12 months ended September 30, 2000.
[LINE GRAPH]
<TABLE>
<CAPTION>
Date CPI ECI
---- --- ---
<S> <C> <C>
Sep-90 6.2 5.2
Oct-90 6.4 5.2
Nov-90 6.3 5.2
Dec-90 6.3 4.9
Jan-91 5.6 4.9
Feb-91 5.3 4.9
Mar-91 4.9 4.6
Apr-91 4.8 4.6
May-91 5 4.6
Jun-91 4.7 4.6
Jul-91 4.4 4.6
Aug-91 3.8 4.6
Sep-91 3.4 4.3
Oct-91 2.8 4.3
Nov-91 3.1 4.3
Dec-91 3 4.3
Jan-92 2.7 4.3
Feb-92 2.8 4.3
Mar-92 3.2 4
Apr-92 3.2 4
May-92 3 4
Jun-92 3 3.6
Jul-92 3.2 3.6
Aug-92 3.1 3.6
Sep-92 3 3.5
Oct-92 3.3 3.5
Nov-92 3.1 3.5
Dec-92 3 3.5
Jan-93 3.2 3.5
Feb-93 3.2 3.5
Mar-93 3 3.5
Apr-93 3.2 3.5
May-93 3.2 3.5
Jun-93 3 3.6
Jul-93 2.8 3.6
Aug-93 2.8 3.6
Sep-93 2.8 3.6
Oct-93 2.8 3.6
Nov-93 2.7 3.6
Dec-93 2.8 3.5
Jan-94 2.5 3.5
Feb-94 2.5 3.5
Mar-94 2.6 3.2
Apr-94 2.4 3.2
May-94 2.3 3.2
Jun-94 2.5 3.2
Jul-94 2.7 3.2
Aug-94 2.9 3.2
Sep-94 3 3.2
Oct-94 2.6 3.2
Nov-94 2.7 3.2
Dec-94 2.6 3
Jan-95 2.8 3
Feb-95 2.9 3
Mar-95 2.9 2.9
Apr-95 2.8 2.9
May-95 3.1 2.9
Jun-95 3 2.9
Jul-95 2.8 2.9
Aug-95 2.6 2.9
Sep-95 2.5 2.7
Oct-95 2.8 2.7
Nov-95 2.6 2.7
Dec-95 2.6 2.8
Jan-96 2.7 2.8
Feb-96 2.7 2.8
Mar-96 2.9 2.8
Apr-96 2.8 2.8
May-96 2.9 2.8
Jun-96 2.8 2.9
Jul-96 2.9 2.9
Aug-96 2.8 2.9
Sep-96 3 2.8
Oct-96 3 2.8
Nov-96 3.2 2.8
Dec-96 3.2 2.9
Jan-97 3 2.9
Feb-97 3 2.9
Mar-97 2.8 2.9
Apr-97 2.5 2.9
May-97 2.2 2.9
Jun-97 2.3 2.8
Jul-97 2.2 2.8
Aug-97 2.2 2.8
Sep-97 2.2 3
Oct-97 2.1 3
Nov-97 1.9 3
Dec-97 1.7 3.3
Jan-98 1.6 3.3
Feb-98 1.4 3.3
Mar-98 1.4 3.3
Apr-98 1.5 3.3
May-98 1.7 3.3
Jun-98 1.6 3.5
Jul-98 1.7 3.5
Aug-98 1.7 3.5
Sep-98 1.4 3.7
Oct-98 1.4 3.7
Nov-98 1.5 3.7
Dec-98 1.6 3.4
Jan-99 1.7 3.4
Feb-99 1.7 3.4
Mar-99 1.8 3
Apr-99 2.3 3
May-99 2.1 3
Jun-99 2 3.2
Jul-99 2.1 3.2
Aug-99 2.3 3.2
Sep-99 2.6 3.1
Oct-99 2.6 3.1
Nov-99 2.6 3.1
Dec-99 2.7 3.4
Jan-00 2.7 3.4
Feb-00 3.2 3.4
Mar-00 3.8 4.3
Apr-00 3.1 4.3
May-00 3.2 4.3
Jun-00 3.7 4.4
Jul-00 3.7 4.4
Aug-00 3.4 4.4
Sep-00 3.5 4.3
Oct-00 3.4
</TABLE>
The Consumer Price Index (CPI) tracks changes in the cost of goods and services
and is the most common measure of inflation. The Employment Cost Index (ECI)
measures the cost of employing workers, including benefits costs. Financial
markets are very sensitive to increases in inflation because of the potentially
negative impact on corporate earnings, investors and consumers.
Data source: Bloomberg L.P.
3
<PAGE> 8
MARKET OVERVIEW Continued
bonds). While short-term interest rates rose during the report period,
intermediate and long-term rates actually fell. Although these events were
comparatively unusual, their net effect on performance was generally positive
for bond investments.
LOOKING AHEAD: GROWTH MAY CONTINUE, BUT RATE MAY SLOW.
Through its aggressive tightening of short-term interest rates in late 1999 and
the first half of 2000, the Fed has sought to slow the economy to a "soft
landing" -- a growth rate that is high enough to avoid recession but not so high
as to tempt inflation.
[PHOTO OF PEOPLE OUTSIDE SHOPS]
Recent evidence indicates that economic growth has indeed slowed from its torrid
pace of the first half of 2000.
________________________________________________________________________________
The consensus among economists is that the U.S. economy appears poised for
continued growth, albeit at lower rates than those of the past few years.
________________________________________________________________________________
Source: Schwab.
The question remains whether the slowdown is only a temporary condition prompted
by a build-up of manufacturing inventories or is the "soft landing" desired by
the Fed.
Factors to watch may include consumer spending and employer competition for
workers. If the slowdown is in fact the desired "soft landing," we would expect
to see a slackening in one or both of these factors.
S&P 500(R) PRICE/EARNINGS RATIO (P/E)
Dollar-weighted average P/E for all stocks in the index
Despite the recent downturn in stocks, the P/E ratio of the S&P 500 ended the
report period at 25.6, a level still significantly above the 30-year average of
15.8.
[LINE GRAPH]
<TABLE>
<CAPTION>
S&P 500 P/E RATIO
S&P 500 P/E RATIO 30-YEAR AVERAGE
----------------- -----------------
<S> <C> <C>
Sep-90 14.34 15.8
Oct-90 14.67 15.8
Nov-90 14.65 15.8
Dec-90 15.28 15.8
Jan-91 15.55 15.8
Feb-91 16.87 15.8
Mar-91 17.56 15.8
Apr-91 17.77 15.8
May-91 18.23 15.8
Jun-91 17.7 15.8
Jul-91 18.37 15.8
Aug-91 20.35 15.8
Sep-91 19.98 15.8
Oct-91 20.37 15.8
Nov-91 20.99 15.8
Dec-91 22.89 15.8
Jan-92 23.03 15.8
Feb-92 25.78 15.8
Mar-92 25.51 15.8
Apr-92 26.03 15.8
May-92 25.22 15.8
Jun-92 25.23 15.8
Jul-92 26.08 15.8
Aug-92 24.22 15.8
Sep-92 24.7 15.8
Oct-92 24.64 15.8
Nov-92 23.8 15.8
Dec-92 24.31 15.8
Jan-93 24.29 15.8
Feb-93 24.44 15.8
Mar-93 23.48 15.8
Apr-93 22.92 15.8
May-93 22.96 15.8
Jun-93 22.9 15.8
Jul-93 22.91 15.8
Aug-93 24.21 15.8
Sep-93 23.77 15.8
Oct-93 24.04 15.8
Nov-93 22.52 15.8
Dec-93 22.95 15.8
Jan-94 22.98 15.8
Feb-94 21.17 15.8
Mar-94 20.34 15.8
Apr-94 20.1 15.8
May-94 20.16 15.8
Jun-94 19.77 15.8
Jul-94 18.63 15.8
Aug-94 18.91 15.8
Sep-94 18.32 15.8
Oct-94 17.51 15.8
Nov-94 16.56 15.8
Dec-94 16.98 15.8
Jan-95 16.05 15.8
Feb-95 16.22 15.8
Mar-95 16.47 15.8
Apr-95 16 15.8
May-95 16.45 15.8
Jun-95 16.77 15.8
Jul-95 16.61 15.8
Aug-95 16.18 15.8
Sep-95 16.85 15.8
Oct-95 16.18 15.8
Nov-95 17.86 15.8
Dec-95 17.41 15.8
Jan-96 18.29 15.8
Feb-96 18.57 15.8
Mar-96 18.94 15.8
Apr-96 19.16 15.8
May-96 19.48 15.8
Jun-96 19.3 15.8
Jul-96 18.31 15.8
Aug-96 18.62 15.8
Sep-96 19.73 15.8
Oct-96 19.59 15.8
Nov-96 21.06 15.8
Dec-96 20.77 15.8
Jan-97 20.52 15.8
Feb-97 20.95 15.8
Mar-97 19.87 15.8
Apr-97 20.23 15.8
May-97 21.45 15.8
Jun-97 22.44 15.8
Jul-97 23.99 15.8
Aug-97 22.74 15.8
Sep-97 24 15.8
Oct-97 22.84 15.8
Nov-97 24.12 15.8
Dec-97 24.53 15.8
Jan-98 25.03 15.8
Feb-98 26.49 15.8
Mar-98 27.98 15.8
Apr-98 26.69 15.8
May-98 26.15 15.8
Jun-98 27.27 15.8
Jul-98 26.94 15.8
Aug-98 22.9 15.8
Sep-98 24.35 15.8
Oct-98 28.07 15.8
Nov-98 30.31 15.8
Dec-98 32.15 15.8
Jan-99 33.9 15.8
Feb-99 32.64 15.8
Mar-99 33.92 15.8
Apr-99 33.9 15.8
May-99 32.74 15.8
Jun-99 34.7 15.8
Jul-99 31.31 15.8
Aug-99 31.21 15.8
Sep-99 30.39 15.8
Oct-99 30.41 15.8
Nov-99 30.65 15.8
Dec-99 32.53 15.8
Jan-00 29.78 15.8
Feb-00 28.59 15.8
Mar-00 31.5 15.8
Apr-00 29.41 15.8
May-00 28.82 15.8
Jun-00 29.31 15.8
Jul-00 28.94 15.8
Aug-00 30.35 15.8
Sep-00 28.64 15.8
Oct-00 25.6 15.8
</TABLE>
P/E is stock price divided by earnings per share (for one company or, as here,
an entire index). P/E indicates the value that investors have placed on a stock,
or group of them. When index P/E is well above its long-term average, it shows
high investor confidence about future earnings growth. It also can mean that if
confidence wanes, there could be a substantial drop in stock prices.
Data source: Bloomberg L.P.
STOCK MARKETS OF SELECTED COUNTRIES
Four best-performing and four worst-performing countries in the MSCI-EAFE(R)
Index during the report period.
While foreign stocks rose 11.8% when measured in their local currencies, a
rising U.S. dollar changed that into a -2.9% return for American investors.
[BAR CHART]
<TABLE>
<S> <C>
Finland 25.54
Denmark 16.93
Norway 14.06
Italy 11.77
MSCI-EAFE INDEX -2.9
Ireland -13.08
Austria -13.92
Belgium -17.75
New Zealand -29.06
</TABLE>
The MSCI Europe, Australasia and Far East (EAFE) Index includes 19 non-U.S.
countries with major stock markets. In any report period, the gap between the
best and worst performers may be substantial. Similarly, a country's performance
may vary widely from period to period, although it's possible for a country to
perform above or below average for an extended time.
Data source: Bloomberg L.P.
4
<PAGE> 9
SCHWAB
S&P 500 FUND
[PHOTO OF GERI HOM]
"The report period saw large-cap stocks end their remarkable five-year run as
the strongest performing asset class."
Portfolio Manager
Geri Hom
GERI HOM, a vice president of the investment adviser, has overall responsibility
for the management of the fund. Prior to joining the firm in 1995, she worked
for nearly 15 years in equity index management.
TICKER SYMBOLS
INVESTOR SHARES SWPIX
SELECT SHARES(R) SWPPX
e.Shares(R) SWPEX
________________________________________________________________________________
[INVESTMENT STYLE 1 AND MARKET CAP 1 GRAPHIC]
<TABLE>
<S> <C> <C>
VALUE BLEND GROWTH
X LARGE
MEDIUM
SMALL
</TABLE>
Long-term investors who want to focus on large-cap U.S. stocks or who are
looking for performance that is linked to a popular index may want to consider
this fund.
________________________________________________________________________________
THE FUND'S GOAL IS TO TRACK THE TOTAL RETURN OF THE S&P 500(R) Index. 2
MANAGER'S PERSPECTIVE
GIVEN THE VOLATILITY THAT PREVAILED IN EQUITY MARKETS, THE FUND PERFORMED
COMPARATIVELY WELL DURING THE REPORT PERIOD. A combination of factors caused
investors to trim their overall exposure to stocks. Among these factors were
high stock prices, uncertainty over the outcome of the presidential election and
potential interest rate hikes. Toward the end of the report period, evidence of
a slowing economy reduced fears of interest rate hikes. Ordinarily this might
have helped the market regain its footing, but concerns about high oil prices
kept stocks in flux.
The S&P 500 Index lagged the Russell 2000(R) Index as small-cap stocks
outperformed mid- and large-caps for the report period. Initially, the fund's
growth stocks outperformed their value counterparts. This trend reversed in the
second half of the period as investors reduced their exposure to technology
issues. Best-performing sectors included utilities, capital goods, health care
and financial services. All share classes of the fund tracked the performance of
the S&P 500 Index for the report period.
1 Source: Morningstar, Inc. This style assessment is the result of comparing the
fund with the S&P 500 Index, based on P/E, P/B and median market cap. The
assessment reflects the fund's portfolio as of 10/31/00, which may have
changed since then, and is not a precise indication of risk or performance--
past, present or future.
2 "Standard & Poor's,(R)" "S&P,(R)" "S&P 500,(R)" "Standard & Poor's 500" and
"500" are trademarks of The McGraw-Hill Companies, Inc. and have been licensed
for use by the Schwab S&P 500 Fund. The fund is not sponsored, endorsed, sold
or promoted by Standard & Poor's, and Standard & Poor's makes no
representation regarding the advisability of investing in the fund.
5
<PAGE> 10
Schwab S&P 500 Fund
PERFORMANCE: INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Investor Shares with the S&P
500(R) Index and the Morningstar Large-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 5/1/96
---------------------- -----------------------
(0.28%) (0.54%)
------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 5.81% 6.09% 8.70% 1 20.28% 20.82% n/a
% of Return Lost to Taxes 7.06% -- 19.77% 1 n/a -- n/a
AFTER-TAX RETURN 2 5.40% -- 6.98% 1 n/a -- n/a
</TABLE>
PERFORMANCE OF A $10,000 INVESTMENT
Shows performance since inception of a hypothetical $10,000 investment in the
fund's Investor Shares, compared to a similar investment in the S&P 500 Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
INVESTOR SHARES S&P 500 INDEX
--------------- -------------
<S> <C> <C>
4/30/96 10000 10000
5/31/96 10250 10257
6/30/96 10290 10296
7/31/96 9840 9841
8/31/96 10040 10049
9/30/96 10600 10613
10/31/96 10880 10906
11/30/96 11690 11731
12/31/96 11462 11498
1/31/97 12157 12216
2/28/97 12248 12312
3/31/97 11744 11808
4/30/97 12430 12511
5/31/97 13186 13272
6/30/97 13760 13867
7/31/97 14849 14969
8/31/97 14012 14131
9/30/97 14778 14904
10/31/97 14284 14406
11/30/97 14930 15073
12/31/97 15184 15332
1/31/98 15357 15502
2/28/98 16455 16620
3/31/98 17289 17471
4/30/98 17452 17647
5/31/98 17147 17344
6/30/98 17838 18048
7/31/98 17645 17857
8/31/98 15092 15278
9/30/98 16058 16257
10/31/98 17340 17579
11/30/98 18387 18645
12/31/98 19443 19718
1/31/99 20253 20543
2/28/99 19617 19904
3/31/99 20397 20700
4/30/99 21176 21501
5/31/99 20663 20994
6/30/99 21812 22159
7/31/99 21125 21467
8/31/99 21012 21360
9/30/99 20428 20775
10/31/99 21709 22090
11/30/99 22150 22539
12/31/99 23448 23866
1/31/00 22266 22668
2/29/00 21841 22239
3/31/00 23967 24414
4/30/00 23241 23679
5/31/00 22753 23194
6/30/00 23313 23767
7/31/00 22940 23396
8/31/00 24361 24849
9/30/00 23075 23537
10/31/00 22971 23438
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution was
made -- currently 39.6% on dividends and short-term capital gains and 20.0% on
long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category that had track records of at least one year. These
funds may or may not use tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
6
<PAGE> 11
PERFORMANCE: SELECT SHARES(R)
AVERAGE ANNUAL TOTAL RETURNS AS OF 10/31/00
This chart compares performance of the fund's Select Shares with the S&P 500(R)
Index and the Morningstar Large-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 5/19/97
----------------------------------- -----------------------------
(0.15%) (0.26%)
--------------------- --------------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 5.94% 6.09% 8.70% 1 18.27% 18.53% n/a
% of Return Lost to Taxes 7.91% -- 19.77% 1 n/a -- n/a
AFTER-TAX RETURN 2 5.47% -- 6.98% 1 n/a -- n/a
</TABLE>
PERFORMANCE OF A $50,000 INVESTMENT
Shows performance since inception of a hypothetical $50,000 investment in the
fund's Select Shares, compared to a similar investment in the S&P 500 Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
SELECT SHARES S&P 500 INDEX
<S> <C> <C>
05/19/97 50000 50000
05/31/97 50935 50930
06/30/97 53190 53212
07/31/97 57395 57442
08/31/97 54165 54225
09/30/97 57120 57191
10/31/97 55215 55281
11/30/97 57745 57841
12/31/97 58745 58836
01/31/98 59375 59489
02/28/98 63660 63778
03/31/98 66880 67043
04/30/98 67550 67720
05/31/98 66370 66556
06/30/98 69040 69258
07/31/98 68295 68524
08/31/98 58435 58629
09/30/98 62165 62387
10/31/98 67155 67459
11/30/98 71245 71547
12/31/98 75340 75668
01/31/99 78475 78831
02/28/99 76015 76379
03/31/99 79030 79434
04/30/99 82085 82509
05/31/99 80140 80561
06/30/99 84545 85033
07/31/99 81885 82380
08/31/99 81490 81968
09/30/99 79230 79721
10/31/99 84230 84767
11/30/99 85935 86491
12/31/99 91000 91585
01/31/00 86420 86987
02/29/00 84770 85341
03/31/00 93050 93687
04/30/00 90235 90867
05/31/00 88350 89004
06/30/00 90515 91203
07/31/00 89110 89780
08/31/00 94655 95356
09/30/00 89635 90322
10/31/00 89230 89942
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made -- currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of
any shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category that had track records of at least one year. These
funds may or may not use tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
7
<PAGE> 12
SCHWAB S&P 500 FUND
PERFORMANCE: e.SHARES(R)
AVERAGE ANNUAL TOTAL RETURNS AS OF 10/31/00
This chart compares performance of the fund's e.Shares with the S&P 500(R) Index
and the Morningstar Large-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 5/1/96
------------------------------ ----------------------------
(0.25%) (0.43%)
----------------- -------------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 5.84% 6.09% 8.70% 1 20.39% 20.82% n/a
% of Return Lost to Taxes 8.05% -- 19.77% 1 n/a -- n/a
AFTER-TAX RETURN 2 5.37% -- 6.98% 1 n/a -- n/a
</TABLE>
PERFORMANCE OF A $10,000 INVESTMENT
Shows performance since inception of a hypothetical $10,000 investment in the
fund's e.Shares, compared to a similar investment in the S&P 500 Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
e.SHARES S&P 500 INDEX
<S> <C> <C>
04/30/96 10000 10000
05/31/96 10250 10257
06/30/96 10290 10296
07/31/96 9840 9841
08/31/96 10050 10049
09/30/96 10600 10613
10/31/96 10890 10906
11/30/96 11710 11731
12/31/96 11473 11498
01/31/97 12179 12216
02/28/97 12270 12312
03/31/97 11766 11808
04/30/97 12452 12511
05/31/97 13209 13272
06/30/97 13794 13867
07/31/97 14873 14969
08/31/97 14036 14131
09/30/97 14803 14904
10/31/97 14318 14406
11/30/97 14964 15073
12/31/97 15227 15332
01/31/98 15390 15502
02/28/98 16490 16620
03/31/98 17336 17471
04/30/98 17499 17647
05/31/98 17193 17344
06/30/98 17886 18048
07/31/98 17692 17857
08/31/98 15136 15278
09/30/98 16103 16257
10/31/98 17397 17579
11/30/98 18446 18645
12/31/98 19504 19718
01/31/99 20316 20543
02/28/99 19679 19904
03/31/99 20459 20700
04/30/99 21240 21501
05/31/99 20737 20994
06/30/99 21878 22159
07/31/99 21199 21467
08/31/99 21086 21360
09/30/99 20501 20775
10/31/99 21795 22090
11/30/99 22227 22539
12/31/99 23536 23866
01/31/00 22350 22668
02/29/00 21924 22239
03/31/00 24057 24414
04/30/00 23328 23679
05/31/00 22850 23194
06/30/00 23401 23767
07/31/00 23037 23396
08/31/00 24462 24849
09/30/00 23172 23537
10/31/00 23068 23438
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of
any shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category that had track records of at least one year. These
funds may or may not use tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
8
<PAGE> 13
FUND FACTS
<TABLE>
<CAPTION>
TOP TEN HOLDINGS 1 AS OF 10/31/00
<S> <C>
1 GENERAL ELECTRIC CO. 4.3%
2 CISCO SYSTEMS, INC. 3.0%
3 MICROSOFT CORP. 2.9%
4 EXXON MOBIL CORP. 2.5%
5 INTEL CORP. 2.4%
6 PFIZER, INC. 2.2%
7 CITIGROUP, INC. 1.9%
8 AMERICAN INTERNATIONAL GROUP, INC. 1.8%
9 MERCK & CO., INC. 1.6%
10 WAL-MART STORES, INC. 1.6%
--------------------------------------------------
TOTAL PERCENTAGE OF INVESTMENTS 24.2%
</TABLE>
STATISTICS AS OF 10/31/00
<TABLE>
<CAPTION>
PEER GROUP
FUND AVERAGE 2
---- -----------
<S> <C> <C>
Number of Holdings 502 137
--------------------------------------------------------------------------
Median Market Cap ($ Mil) $82,003 $56,749
--------------------------------------------------------------------------
Price/Earnings (P/E) Ratio 34.1 34.3
--------------------------------------------------------------------------
Price/Book (P/B) Ratio 8.9 8.7
--------------------------------------------------------------------------
12-Month Yield Investor Shares 0.82% 0.45%
--------------------------------------------------------------------------
Portfolio Turnover Rate 9% 98%
--------------------------------------------------------------------------
Three-Year Beta 1.00 0.95
--------------------------------------------------------------------------
</TABLE>
EXPENSE RATIO AS OF 10/31/00
<TABLE>
<S> <C>
INVESTOR SHARES 0.35% 3
SELECT SHARES 0.19% 3
e.SHARES 0.28% 3
PEER GROUP AVERAGE 1.34% 2
</TABLE>
1 This list is not a recommendation of any security by the investment
adviser. Portfolio holdings may have changed since the report date.
2 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Morningstar Large-Cap Fund category.
3 Guaranteed by Schwab and the investment adviser through 2/28/01. The actual
expense ratio during the report period was 0.01% higher due to certain
non-routine expenses.
4 Source: Standard & Poor's(R), a division of McGraw-Hill companies.
INDEX COMPOSITION BY INDUSTRY 4
These charts show the size of the ten largest industries in the S&P 500(R)
Index. As the charts show, the total portion represented by these industries has
been growing over the past five years.
AS OF 10/31/00
[PIE CHART]
<TABLE>
<S> <C> <C>
1 14.8% Business Machines
2 12.0% Drugs & Medicine
3 9.8% Electronics
4 6.8% Miscellaneous Finance
5 6.3% Telephone
6 5.6% Producer Goods
7 5.2% Retail
8 5.1% Banks
9 4.7% Business Services
10 4.2% International Oil
25.6% Other
</TABLE>
AS OF 10/31/99
[PIE CHART]
<TABLE>
<S> <C> <C>
1 13.4% Business Machines
2 10.9% Drugs & Medicine
3 8.3% Telephone
4 8.0% Electronics
5 6.5% Banks
6 6.4% Retail
7 5.8% Miscellaneous Finance
8 5.4% Producer Goods
9 4.2% International Oil
10 3.8% Food & Agriculture
27.4% Other
</TABLE>
AS OF 10/31/95
[PIE CHART]
<TABLE>
<S> <C> <C>
1 10.0% Drugs & Medicine
2 8.9% Telephone
3 6.6% International Oil
4 6.5% Food & Agriculture
5 6.2% Banks
6 5.7% Business Machines
7 5.2% Producer Goods
8 5.1% Electronics
9 4.6% Retail
10 4.5% Energy & Utilities
36.8% Other
</TABLE>
9
<PAGE> 14
SCHWAB S&P 500 FUND -- FINANCIALS
FINANCIAL TABLES
These pages provide additional data on the fund's performance, portfolio
holdings, expenses and business operations. These figures have been audited by
PricewaterhouseCoopers LLP.
Two other sections of this report provide context for the data in these
financials. THE FINANCIAL NOTES section contains information about the fund's
business structure, accounting practices and other matters, completing the data
given in these tables. The final section, HOW TO READ THIS REPORT, includes
guides designed to make the financials easy to read and understand.
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
11/1/99 - 11/1/98 - 11/1/97 - 11/1/96 - 5/1/96 1 -
INVESTOR SHARES 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period 21.17 17.05 14.17 10.88 10.00
----- ----- ----- ----- -----
Income from investment operations:
Net investment income 0.17 0.17 0.16 0.14 0.08
Net realized and unrealized gains 1.06 4.10 2.85 3.24 0.80
----- ----- ----- ----- -----
Total income from investment operations 1.23 4.27 3.01 3.38 0.88
Less distributions:
Dividends from net investment income (0.18) (0.15) (0.13) (0.09) --
Distributions from net realized gains (0.07) -- -- -- --
----- ----- ----- ----- -----
Total distributions (0.25) (0.15) (0.13) (0.09) --
----- ----- ----- ----- -----
Net asset value at end of period 22.15 21.17 17.05 14.17 10.88
===== ===== ===== ===== =====
Total return (%) 5.81 25.20 21.39 31.29 8.80 2
RATIOS/SUPPLEMENTAL DATA (%)
----------------------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses to
average net assets 0.35 4 0.35 0.35 0.38 0.49 3
Expense reductions reflected in above ratio 0.16 0.27 0.28 0.32 0.40 3
Ratio of net investment income to
average net assets 0.81 1.01 1.25 1.49 1.89 3
Portfolio turnover rate 9 3 1 3 1
Net assets, end of period ($ x 1,000,000) 3,617 3,183 1,935 923 244
</TABLE>
1 Commencement of operations.
2 Not annualized.
3 Annualized.
4 Would have been 0.36% if certain non-routine expenses (proxy fees) had been
included.
10 See the Financial Notes, which
are integral to this information.
<PAGE> 15
<TABLE>
<CAPTION>
11/1/99 - 11/1/98 - 11/1/97 - 5/19/97 1 -
SELECT SHARES(R) 10/31/00 10/31/99 10/31/98 10/31/97
<S> <C> <C> <C> <C>
PER-SHARE DATA ($)
----------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period 21.23 17.09 14.19 12.85
----- ----- ----- -----
Income from investment operations:
Net investment income 0.20 0.20 0.26 0.05
Net realized and unrealized gains 1.06 4.12 2.78 1.29
----- ----- ----- -----
Total income from investment operations 1.26 4.32 3.04 1.34
Less distributions:
Dividends from net investment income (0.21) (0.18) (0.14) --
Distributions from net realized gains (0.07) -- -- --
----- ----- ----- -----
Total distributions (0.28) (0.18) (0.14) --
----- ----- ----- -----
Net asset value at end of period 22.21 21.23 17.09 14.19
===== ===== ===== =====
Total return (%) 5.94 25.42 21.63 10.43 2
RATIOS/SUPPLEMENTAL DATA (%)
----------------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses
to average net assets 0.19 4 0.19 0.19 0.19 3
Expense reductions reflected in above ratio 0.16 0.28 0.28 0.34 3
Ratio of net investment income to
average net assets 0.98 1.17 1.40 1.46 3
Portfolio turnover rate 9 3 1 3
Net assets, end of period ($ x 1,000,000) 4,357 3,750 1,548 486
</TABLE>
<TABLE>
<CAPTION>
11/1/99 - 11/1/98 - 11/1/97 - 11/1/96 - 5/1/96 1 -
e.SHARES(R) 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
--------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period 21.21 17.08 14.19 10.89 10.00
----- ----- ----- ----- -----
Income from investment operations:
Net investment income 0.20 0.20 0.15 0.21 0.04
Net realized and unrealized gains 1.04 4.09 2.88 3.19 0.85
----- ----- ----- ----- -----
Total income from investment operations 1.24 4.29 3.03 3.40 0.89
Less distributions:
Dividends from net investment income (0.21) (0.16) (0.14) (0.10) --
Distributions from net realized gains (0.07) -- -- -- --
----- ----- ----- ----- -----
Total distributions (0.28) (0.16) (0.14) (0.10) --
----- ----- ----- ----- -----
Net asset value at end of period 22.17 21.21 17.08 14.19 10.89
===== ===== ===== ===== =====
Total return (%) 5.84 25.28 21.50 31.48 8.90 2
RATIOS/SUPPLEMENTAL DATA (%)
--------------------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses
to average net assets 0.28 5 0.28 0.28 0.28 0.28 3
Expense reductions reflected in above ratio 0.07 0.20 0.24 0.33 0.91 3
Ratio of net investment income to
average net assets 0.88 1.08 1.32 1.61 1.82 3
Portfolio turnover rate 9 3 1 3 1
Net assets, end of period ($ x 1,000,000) 441 435 281 132 36
</TABLE>
1 Commencement of operations
2 Not annualized.
3 Annualized.
4 Would have been 0.20% if certain non-routine expenses (proxy fees) had been
included.
5 Would have been 0.29% if certain non-routine expenses (proxy fees) had been
included.
See the Financial Notes, which 11
are integral to this information.
<PAGE> 16
SCHWAB S&P 500 FUND -- FINANCIALS
PORTFOLIO HOLDINGS
As of October 31, 2000
This section shows all the securities in the fund's portfolio and their market
value, as of the report date.
We use the symbols below to designate certain characteristics. With the top ten
holdings, the number in the circle is the security's rank among the top ten.
(1) Top ten holding
+ New holding (since 10/31/99)
- Non-income producing security
* American Depositary Receipt
# Collateral for open futures contracts
## Issuer is affiliated with the fund's adviser
The pie chart below shows the fund's major asset categories and the market value
and cost of the securities in each category.
[PIE CHART]
ALL DOLLAR VALUES ARE IN THOUSANDS.
<TABLE>
<S> <C>
COMMON STOCK 99.8%
Market Value: $8,403,483
Cost: $6,336,019
OTHER INVESTMENT COMPANIES 0.2%
Market Value: $16,410
Cost: $16,410
U.S. TREASURY OBLIGATIONS 0.0%
Market Value: $640
Cost: $640
-------------------------------------
TOTAL INVESTMENTS 100.0%
Market Value: $8,420,533
Cost: $6,353,069
</TABLE>
COMMON STOCK 99.8% OF INVESTMENTS
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
AEROSPACE / DEFENSE 1.3%
---------------------------------------------------------------------------
<S> <C>
B.F. Goodrich Co. 67,713 2,772
Boeing Co. 599,654 40,664
Crane Co. 39,269 1,028
General Dynamics Corp. 132,962 9,515
Lockheed Martin Corp. 285,310 10,228
Northrop Grumman Corp. 48,339 4,060
Raytheon Co., Class B 226,694 7,750
Rockwell International Corp. 123,536 4,857
Textron, Inc. 96,045 4,844
TRW, Inc. 82,157 3,451
United Technologies Corp. 312,984 21,850
-----------
111,019
AIR TRANSPORTATION 0.3%
---------------------------------------------------------------------------
- AMR Corp. 99,584 3,261
Delta Air Lines, Inc. 81,006 3,828
- FedEx Corp. 190,688 8,936
Southwest Airlines Co. 333,218 9,497
- U.S. Airways Group, Inc. 44,190 1,668
-----------
27,190
ALCOHOLIC BEVERAGES 0.4%
---------------------------------------------------------------------------
Adolph Coors Co., Class B 25,077 1,597
Anheuser-Busch Cos., Inc. 605,354 27,695
Brown-Forman Corp., Class B 45,744 2,785
-----------
32,077
APPAREL 0.1%
---------------------------------------------------------------------------
Liz Claiborne, Inc. 36,346 1,545
Nike, Inc., Class B 179,803 7,181
- Reebok International Ltd. 38,318 826
Russell Corp. 21,076 337
Springs Industries, Inc., Class A 11,542 272
VF Corp. 76,062 2,077
-----------
12,238
AUTOMOTIVE PRODUCTS / MOTOR VEHICLES 1.1%
---------------------------------------------------------------------------
Cooper Tire & Rubber Co. 49,364 540
Cummins Engine Co., Inc. 26,980 917
Dana Corp. 99,596 2,210
Danaher Corp. 94,200 5,946
Delphi Automotive Systems Corp. 374,280 5,872
Eaton Corp. 48,661 3,312
Ford Motor Co. 1,264,885 33,045
General Motors Corp. 358,473 22,270
Genuine Parts Co. 115,876 2,470
Goodyear Tire & Rubber Co. 103,926 1,923
+ Harley-Davidson, Inc. 202,300 9,748
- Navistar International Corp. 40,353 1,334
+ Visteon Corp. 86,916 1,537
-----------
91,124
BANKS 5.3%
---------------------------------------------------------------------------
AmSouth Bancorp. 251,050 3,499
Bank of America Corp. 1,097,599 52,753
Bank of New York Co., Inc. 493,286 28,395
</TABLE>
12 See the Financial Notes, which
are integral to this information.
<PAGE> 17
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Bank One Corp. 772,224 28,186
BB&T Corp. 267,272 8,519
Chase Manhattan Corp. 874,905 39,808
Comerica, Inc. 104,430 6,298
Fifth Third Bancorp. 310,024 15,927
First Union Corp. 658,121 19,949
Firstar Corp. 640,491 12,610
FleetBoston Financial Corp. 603,020 22,915
Golden West Financial Corp. 105,357 5,907
Huntington Bancshares, Inc. 165,911 2,385
J.P. Morgan & Co., Inc. 105,974 17,539
KeyCorp, Inc. 287,808 7,105
Mellon Financial Corp. 325,252 15,693
National City Corp. 403,700 8,629
Northern Trust Corp. 148,400 12,670
+ Old Kent Financial Corp. 90,510 2,506
PNC Financial Services Group 193,241 12,923
Providian Financial Corp. 95,094 9,890
Regions Financial Corp. 146,300 3,447
SouthTrust Corp. 111,400 3,607
State Street Corp. 107,535 13,414
Summit Bancorp. 115,700 4,339
SunTrust Banks, Inc. 198,747 9,701
Synovus Financial Corp. 188,647 4,068
U.S. Bancorp. 497,181 12,026
Union Planters Corp. 91,100 3,080
Wachovia Corp. 135,526 7,318
Wells Fargo & Co. 1,100,006 50,944
-----------
446,050
BUSINESS MACHINES & SOFTWARE 14.8%
-------------------------------------------------------------------------
- Adaptec, Inc. 67,700 1,071
Adobe Systems, Inc. 160,608 12,216
- Apple Computer, Inc. 215,932 4,224
Autodesk, Inc. 37,800 834
- BMC Software, Inc. 163,300 3,317
- Cabletron Systems, Inc. 122,329 3,318
- Ceridian Corp. 96,820 2,421
- (2) Cisco Systems, Inc. 4,741,480 255,448
Compaq Computer Corp. 1,135,894 34,543
- Compuware Corp. 242,500 1,910
- Comverse Technology, Inc. 103,900 11,611
- Dell Computer Corp. 1,728,528 50,992
- EMC Corp. 1,458,974 129,940
- Gateway, Inc. 215,400 11,117
Hewlett-Packard Co. 1,332,646 61,885
International Business Machines Corp. 1,178,904 116,122
- Lexmark International Group, Inc., Class A 85,600 3,510
- (3) Microsoft Corp. 3,516,112 242,172
- + NCR Corp. 64,100 2,764
- Network Appliance, Inc. 208,600 24,823
- Novell, Inc. 215,229 1,937
- + Novellus Systems, Inc. 87,450 3,580
- Oracle Corp. 3,761,580 124,132
Pitney Bowes, Inc. 169,602 5,035
Seagate Technology, Inc. 153,111 10,699
- Sun Microsystems, Inc. 1,060,984 117,637
- Unisys Corp. 208,715 2,661
Xerox Corp. 447,174 3,773
-----------
1,243,692
BUSINESS SERVICES 6.0%
-------------------------------------------------------------------------
- Allied Waste Industries, Inc. 130,200 1,204
- America Online, Inc. 1,542,700 77,798
Automatic Data Processing, Inc. 419,124 27,374
- Cendant Corp. 487,695 5,852
- + Citrix Systems, Inc. 123,400 2,730
Computer Associates International, Inc. 394,990 12,590
- Computer Sciences Corp. 112,722 7,101
- + Convergys Corp. 102,241 4,454
Deluxe Corp. 48,172 1,087
Ecolab, Inc. 84,770 3,322
Electronic Data Systems Corp. 310,800 14,588
Equifax, Inc. 94,215 3,250
Exelon Corp. 216,373 13,009
First Data Corp. 271,527 13,610
H&R Block, Inc. 60,917 2,174
IMS Health, Inc. 198,186 4,682
Interpublic Group of Cos., Inc. 205,720 8,833
- + Mercury Interactive Corp. 53,100 5,894
National Service Industries, Inc. 26,600 544
Nortel Networks Corp. 1,995,680 90,803
Omnicom Group, Inc. 119,200 10,996
- Parametric Technology Corp. 180,632 2,224
</TABLE>
See the Financial Notes, which 13
are integral to this information.
<PAGE> 18
SCHWAB S&P 500 FUND -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Paychex, Inc. 248,325 14,077
- PeopleSoft, Inc. 185,800 8,108
- + Sapient Corp. 79,200 2,817
- + Siebel Systems, Inc. 278,900 29,267
+ Stilwell Financial, Inc. 149,200 6,686
Tyco International Ltd. 1,145,288 64,924
- + VERITAS Software Corp. 268,400 37,849
Waste Management, Inc. 414,426 8,289
- + Yahoo!, Inc. 367,100 21,521
-----------
507,657
CHEMICAL 0.9%
-------------------------------------------------------------------------
Air Products & Chemicals, Inc. 153,258 5,718
Dow Chemical Co. 452,328 13,853
E.I. du Pont de Nemours & Co. 696,654 31,611
Eastman Chemical Co. 51,364 2,202
Great Lakes Chemical Corp. 35,725 1,192
Hercules, Inc. 70,157 1,285
PPG Industries, Inc. 115,575 5,158
Praxair, Inc. 105,030 3,912
Rohm & Haas Co. 143,850 4,324
Sigma-Aldrich Corp. 53,709 1,920
Union Carbide Corp. 90,260 3,881
- W.R. Grace & Co. 45,500 173
-----------
75,229
CONSTRUCTION 0.2%
-------------------------------------------------------------------------
Armstrong Holdings, Inc. 26,100 75
Centex Corp. 39,122 1,448
Fluor Corp. 49,875 1,746
Kaufman & Broad Home Corp. 31,181 928
Masco Corp. 303,790 5,677
Pulte Corp. 26,888 896
Sherwin-Williams Co. 107,861 2,339
The Stanley Works 57,186 1,523
Vulcan Materials Co. 66,700 2,801
-----------
17,433
CONSUMER: DURABLE 0.1%
-------------------------------------------------------------------------
Black & Decker Corp. 55,597 2,092
Leggett & Platt, Inc. 131,400 2,152
Maytag Corp. 51,356 1,470
Whirlpool Corp. 47,656 2,073
-----------
7,787
CONSUMER: NONDURABLE 0.7%
-------------------------------------------------------------------------
American Greetings Corp., Class A 42,057 765
Darden Restaurants, Inc. 80,320 1,807
Fortune Brands, Inc. 103,558 3,048
Harcourt General, Inc. 48,300 2,707
Hasbro, Inc. 114,397 1,230
Mattel, Inc. 287,507 3,720
McDonald's Corp. 882,474 27,357
Newell Rubbermaid, Inc. 177,033 3,397
- + Starbucks Corp. 124,800 5,577
- Tricon Global Restaurants, Inc. 96,450 2,894
Tupperware Corp. 37,578 644
Wendy's International, Inc. 77,475 1,685
-----------
54,831
CONTAINERS 0.1%
-------------------------------------------------------------------------
Ball Corp. 19,763 694
Bemis Co., Inc. 34,711 898
Crown Cork & Seal Co., Inc. 84,468 771
- Owens-Illinois, Inc. 97,593 579
- + Pactiv Corp. 111,556 1,171
- Sealed Air Corp. 55,426 2,667
-----------
6,780
ELECTRONICS 8.6%
-------------------------------------------------------------------------
- ADC Telecommunications, Inc. 514,300 10,993
- Advanced Micro Devices, Inc. 207,688 4,699
- + Altera Corp. 266,700 10,918
- + American Power Conversion Corp. 128,550 1,663
- Analog Devices, Inc. 236,900 15,399
- Andrew Corp. 53,888 1,418
- Applied Materials, Inc. 542,024 28,795
- + Broadcom Corp., Class A 148,874 33,106
- + Conexant Systems, Inc. 151,900 3,997
(5) Intel Corp. 4,486,048 201,872
ITT Industries, Inc. 58,647 1,910
- + JDS Uniphase Corp. 626,600 51,029
- KLA-Tencor Corp. 123,550 4,178
+ Linear Technology Corp. 207,800 13,416
- LSI Logic Corp. 206,794 6,798
Lucent Technologies, Inc. 2,229,635 51,978
- + Maxim Integrated Products, Inc. 189,000 12,533
- Micron Technology, Inc. 376,280 13,076
</TABLE>
14 See the Financial Notes, which
are integral to this information.
<PAGE> 19
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
+ Molex, Inc. 131,300 7,090
Moody's Corp. 107,956 2,841
Motorola, Inc. 1,456,998 36,334
- National Semiconductor Corp. 117,937 3,066
- Nextel Communications, Inc., Class A 508,800 19,557
PE Corp.--PE Biosystems Group 139,064 16,270
PerkinElmer, Inc. 33,096 3,955
- + Power-One, Inc. 49,100 3,483
- QUALCOMM, Inc. 497,900 32,418
- + Sanmina Corp. 100,900 11,534
Scientific-Atlanta, Inc. 106,224 7,270
- Solectron Corp. 402,000 17,688
Tektronix, Inc. 32,405 2,309
- Tellabs, Inc. 273,456 13,656
- + Teradyne, Inc. 115,200 3,600
Texas Instruments, Inc. 1,154,904 56,662
- Thermo Electron Corp. 114,714 3,327
Thomas & Betts Corp. 37,815 572
- + Xilinx, Inc. 219,700 15,915
-----------
725,325
ENERGY: RAW MATERIALS 1.0%
-------------------------------------------------------------------------
Anadarko Petroleum Corp. 162,089 10,382
Apache Corp. 81,789 4,524
Baker Hughes, Inc. 220,508 7,580
Burlington Resources, Inc. 144,155 5,190
+ Devon Energy Corp. 84,900 4,279
Eastern Enterprises 17,843 1,149
Halliburton Co. 296,829 11,001
McDermott International, Inc. 38,900 377
- + Nabors Industries, Inc. 97,400 4,958
Occidental Petroleum Corp. 244,992 4,869
- Rowan Cos., Inc. 62,881 1,584
Schlumberger Ltd. 380,934 28,999
-----------
84,892
FOOD & AGRICULTURE 3.2%
-------------------------------------------------------------------------
Archer-Daniels-Midland Co. 419,874 4,619
Campbell Soup Co. 281,527 8,235
Coca-Cola Co. 1,654,682 99,901
Coca-Cola Enterprises, Inc. 279,600 5,138
ConAgra, Inc. 355,400 7,597
General Mills, Inc. 191,568 7,998
H.J. Heinz Co. 232,138 9,735
Hershey Foods Corp. 91,198 4,953
Kellogg Co. 271,162 6,881
Nabisco Group Holdings Corp. 218,200 6,301
PepsiCo, Inc. 964,297 46,708
Quaker Oats Co. 88,487 7,217
Ralston Purina Group 203,869 4,944
Sara Lee Corp. 579,638 12,498
Supervalu, Inc. 90,954 1,398
Sysco Corp. 222,428 11,608
* Unilever NV 381,932 19,407
Wm. Wrigley Jr. Co. 75,543 5,982
-----------
271,120
GOLD 0.1%
-------------------------------------------------------------------------
Barrick Gold Corp. 262,079 3,505
Homestake Mining Co. 174,807 721
Newmont Mining Corp. 111,669 1,515
Placer Dome, Inc. 218,900 1,779
-----------
7,520
HEALTHCARE / DRUGS & MEDICINE 11.9%
-------------------------------------------------------------------------
Abbott Laboratories 1,037,614 54,799
Aetna, Inc. 94,158 5,444
Allergan, Inc. 87,670 7,370
- ALZA Corp. 76,778 6,214
American Home Products Corp. 871,110 55,316
- Amgen, Inc. 687,116 39,810
Bausch & Lomb, Inc. 34,816 1,343
Baxter International, Inc. 194,784 16,009
Becton, Dickinson & Co. 169,310 5,672
- + Biogen, Inc. 98,300 5,916
Biomet, Inc. 118,498 4,288
- Boston Scientific Corp. 271,712 4,330
Bristol-Myers Squibb Co. 1,313,564 80,045
C.R. Bard, Inc. 33,520 1,404
Cardinal Health, Inc. 185,190 17,547
Eli Lilly & Co. 754,724 67,453
- Guidant Corp. 204,620 10,832
+ HCA--The Healthcare Co. 371,816 14,849
- HealthSouth Corp. 255,409 3,065
- Humana, Inc. 109,242 1,325
Johnson & Johnson 930,180 85,693
- + King Pharmaceuticals, Inc. 110,610 4,957
- Manor Care, Inc. 66,333 1,107
McKesson HBOC, Inc. 189,420 5,316
</TABLE>
See the Financial Notes, which
are integral to this information. 15
<PAGE> 20
SCHWAB S&P 500 FUND -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- + Medimmune, Inc. 139,900 9,146
Medtronic, Inc. 801,054 43,507
(9) Merck & Co., Inc. 1,539,046 138,418
(6) Pfizer, Inc. 4,218,577 182,190
Pharmacia Corp. 869,480 47,821
- + Quintiles Transnational Corp. 76,800 1,070
Schering-Plough Corp. 980,962 50,703
- St. Jude Medical, Inc. 55,892 3,074
- Tenet Healthcare Corp. 210,433 8,273
UnitedHealth Group, Inc. 107,392 11,746
- Watson Pharmaceuticals, Inc. 67,800 4,242
- Wellpoint Health Networks, Inc. 41,800 4,888
-----------
1,005,182
HOUSEHOLD PRODUCTS 1.5%
-------------------------------------------------------------------------
Alberto-Culver Co., Class B 36,317 1,219
Avon Products, Inc. 158,754 7,700
Clorox Co. 156,532 6,985
Colgate-Palmolive Co. 383,836 22,554
Gillette Co. 703,438 24,532
International Flavors & Fragrances, Inc. 67,128 1,124
Procter & Gamble Co. 873,922 62,431
-----------
126,545
INSURANCE 3.8%
-------------------------------------------------------------------------
AFLAC, Inc. 176,800 12,917
Allstate Corp. 490,718 19,751
American General Corp. 168,822 13,590
(8) American International Group, Inc. 1,547,015 151,607
Aon Corp. 169,448 7,022
Chubb Corp. 117,260 9,901
CIGNA Corp. 104,965 12,800
Cincinnati Financial Corp. 106,945 3,930
Conseco, Inc. 216,102 1,499
Hartford Financial Services Group, Inc. 149,992 11,165
Jefferson-Pilot Corp. 68,322 4,697
Lincoln National Corp. 127,526 6,169
Loew's Corp. 66,440 6,042
Marsh & McLennan Cos., Inc. 180,978 23,663
MBIA, Inc. 65,186 4,738
MGIC Investment Corp. 71,238 4,853
Progressive Corp. 48,751 4,790
SAFECO Corp. 84,791 2,051
St. Paul Cos., Inc. 149,316 7,652
Torchmark Corp. 85,289 2,841
UnumProvident Corp. 159,928 4,518
-----------
316,196
MEDIA 3.3%
-------------------------------------------------------------------------
- Clear Channel Communications, Inc. 391,298 23,502
- Comcast Corp., Special Class A 604,558 24,636
Dow Jones & Co., Inc. 58,050 3,418
Gannett Co., Inc. 176,292 10,225
Knight-Ridder, Inc. 50,683 2,547
McGraw-Hill Cos., Inc. 130,364 8,368
Meredith Corp. 33,012 1,048
New York Times Co., Class A 111,300 4,090
R.R. Donnelley & Sons Co. 80,106 1,722
Seagram Co. Ltd. 290,875 16,616
Time Warner, Inc. 884,340 67,130
Tribune Co. 206,012 7,635
- Viacom, Inc., Class B 1,013,400 57,637
The Walt Disney Co. 1,392,830 49,881
-----------
278,455
MISCELLANEOUS 0.5%
-------------------------------------------------------------------------
- + Agilent Technologies, Inc. 301,795 13,977
- + Palm, Inc. 377,540 20,222
- + Sabre Group Corp. 86,301 2,886
XCEL Energy, Inc. 226,270 5,784
-----------
42,869
MISCELLANEOUS FINANCE 6.5%
-------------------------------------------------------------------------
American Express Co. 892,237 53,534
Associates First Capital Corp., Class A 485,702 18,032
Bear Stearns Cos., Inc. 71,701 4,347
Capital One Financial Corp. 131,350 8,291
## Charles Schwab Corp. 922,560 32,405
+ Charter One Financial, Inc. 139,950 3,210
+ CIT Group, Inc., Class A 177,400 3,093
(7) Citigroup, Inc. 3,005,908 158,186
Countrywide Credit Industries, Inc. 75,824 2,839
Fannie Mae 676,117 52,061
Franklin Resources, Inc. 162,800 6,974
Freddie Mac 464,452 27,867
</TABLE>
16 See the Financial Notes, which
are integral to this information.
<PAGE> 21
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Household International, Inc. 314,908 15,844
Lehman Brothers Holdings, Inc. 162,200 10,462
MBNA Corp. 569,120 21,378
Merrill Lynch & Co., Inc. 538,084 37,666
Morgan Stanley Dean Witter & Co. 751,772 60,377
Paine Webber Group, Inc. 98,600 7,025
T. Rowe Price Associates, Inc. 80,300 3,759
USA Education, Inc. 103,200 5,766
Washington Mutual, Inc. 359,856 15,834
-----------
548,950
NON-FERROUS METALS 0.4%
-------------------------------------------------------------------------
Alcan Aluminum Ltd. 222,774 7,031
Alcoa, Inc. 577,346 16,563
Engelhard Corp. 87,001 1,816
- Freeport-McMoRan Copper & Gold, Inc., Class B 106,415 845
- Inco Ltd. 121,449 1,875
Phelps Dodge Corp. 52,654 2,462
-----------
30,592
OIL: DOMESTIC 0.6%
-------------------------------------------------------------------------
Amerada Hess Corp. 60,092 3,726
Ashland, Inc. 46,356 1,518
Conoco, Inc., Class B 416,300 11,318
Kerr-McGee Corp. 62,573 4,087
Phillips Petroleum Co. 169,950 10,494
Sunoco, Inc. 57,752 1,729
Tosco Corp. 96,000 2,748
Transocean Sedco Forex, Inc. 140,883 7,467
Unocal Corp. 161,316 5,505
USX-Marathon Group, Inc. 207,402 5,639
-----------
54,231
OIL: INTERNATIONAL 4.2%
-------------------------------------------------------------------------
Chevron Corp. 436,168 35,820
(4) Exxon Mobil Corp. 2,327,853 207,615
* Royal Dutch Petroleum Co. 1,432,980 85,083
Texaco, Inc. 368,354 21,756
-----------
350,274
OPTICAL & PHOTO 0.1%
-------------------------------------------------------------------------
Eastman Kodak Co. 205,781 9,234
Polaroid Corp. 29,495 297
-----------
9,531
PAPER & FOREST PRODUCTS 0.7%
-------------------------------------------------------------------------
Boise Cascade Corp. 37,216 1,068
Fort James Corp. 136,895 4,509
Georgia-Pacific Group 113,282 3,044
International Paper Co. 321,828 11,787
Kimberly-Clark Corp. 359,613 23,734
Louisiana-Pacific Corp. 69,228 588
Mead Corp. 67,719 1,960
Potlatch Corp. 18,660 625
Temple-Inland, Inc. 34,019 1,522
Westvaco Corp. 67,313 1,918
Weyerhaeuser Co. 146,717 6,887
Willamette Industries, Inc. 72,832 2,645
-----------
60,287
PRODUCER GOODS & MANUFACTURING 6.4%
-------------------------------------------------------------------------
Avery Dennison Corp. 74,115 3,743
Briggs & Stratton Corp. 15,200 542
Caterpillar, Inc. 230,486 8,081
Cooper Industries, Inc. 61,555 2,354
Corning, Inc. 590,646 45,184
Deere & Co. 155,827 5,736
Dover Corp. 135,465 5,749
Emerson Electric Co. 285,626 20,976
- FMC Corp. 20,778 1,579
# (1) General Electric Co. 6,617,920 362,745
Honeywell International, Inc. 535,243 28,803
Illinois Tool Works, Inc. 201,821 11,214
Ingersoll-Rand Co. 106,597 4,024
Johnson Controls, Inc. 57,275 3,415
Millipore Corp. 30,991 1,627
Minnesota Mining & Manufacturing Co. 264,468 25,554
Pall Corp. 81,066 1,748
Parker-Hannifin Corp. 75,833 3,138
Snap-On, Inc. 38,150 975
The Timken Co. 40,332 567
W.W. Grainger, Inc. 62,008 1,980
-----------
539,734
</TABLE>
See the Financial Notes, which 17
are integral to this information.
<PAGE> 22
SCHWAB S&P 500 FUND -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
RAILROAD & SHIPPING 0.3%
-------------------------------------------------------------------------
Burlington Northern Santa Fe Corp. 269,375 7,155
CSX Corp. 144,855 3,667
Norfolk Southern Corp. 255,688 3,612
Union Pacific Corp. 165,716 7,768
-----------
22,202
RETAIL 5.1%
-------------------------------------------------------------------------
Albertson's, Inc. 283,837 6,723
- AutoZone, Inc. 86,215 2,312
- Bed, Bath & Beyond, Inc. 189,000 4,879
- Best Buy Co., Inc. 137,900 6,921
Circuit City Stores-Circuit City Group 136,012 1,802
- Consolidated Stores Corp. 74,000 879
- Costco Wholesale Corp. 298,088 10,917
CVS Corp. 260,618 13,796
Dillards, Inc., Class A 60,933 640
Dollar General Corp. 219,057 3,395
- Federated Department Stores, Inc. 138,537 4,511
Gap, Inc. 568,202 14,667
Home Depot, Inc. 1,546,725 66,509
J.C. Penney Co., Inc. 176,920 2,068
- Kmart Corp. 317,117 1,883
- Kohl's Corp. 219,800 11,910
- Kroger Co. 552,062 12,456
Limited, Inc. 287,734 7,265
Longs Drug Stores, Inc. 25,682 562
Lowe's Cos., Inc. 255,826 11,688
May Department Stores Co. 198,179 5,202
Nordstrom, Inc. 87,822 1,444
- Office Depot, Inc. 207,000 1,721
RadioShack Corp. 124,242 7,408
- Safeway, Inc. 332,200 18,167
Sears, Roebuck & Co. 228,418 6,791
- Staples, Inc. 302,550 4,311
Target Corp. 608,020 16,797
+ Tiffany & Co., Inc. 97,050 4,143
TJX Cos., Inc. 197,182 5,373
- Toys 'R' Us, Inc. 135,896 2,336
(10) Wal-Mart Stores, Inc. 2,984,262 135,411
Walgreen Co. 674,856 30,790
Winn-Dixie Stores, Inc. 95,211 1,833
-----------
427,510
STEEL 0.1%
-------------------------------------------------------------------------
Allegheny Technologies, Inc. 54,351 1,101
- Bethlehem Steel Corp. 85,535 246
Nucor Corp. 55,684 1,932
USX-U.S. Steel Group, Inc. 58,879 938
Worthington Industries, Inc. 58,102 556
-----------
4,773
TELEPHONE 6.2%
-------------------------------------------------------------------------
Alltel Corp. 210,390 13,557
AT&T Corp. 2,507,975 58,154
- + Avaya, Inc. 186,052 2,500
BellSouth Corp. 1,252,192 60,497
CenturyTel, Inc. 93,150 3,586
- Global Crossing Ltd. 587,255 13,874
- + Qwest Communications International, Inc. 1,109,702 53,959
SBC Communications, Inc. 2,263,930 130,600
Sprint Corp. (FON Group) 589,398 15,030
- Sprint Corp. (PCS Group) 620,298 23,649
Verizon Communications 1,815,456 104,956
- Worldcom, Inc. 1,918,204 45,557
-----------
525,919
TOBACCO 0.7%
-------------------------------------------------------------------------
Philip Morris Cos., Inc. 1,503,862 55,079
UST, Inc. 108,300 2,735
-----------
57,814
TRAVEL & RECREATION 0.3%
-------------------------------------------------------------------------
Brunswick Corp. 57,407 1,116
Carnival Corp. 392,800 9,746
- Harrah's Entertainment, Inc. 79,911 2,287
Hilton Hotels Corp. 248,872 2,364
Marriott International, Inc., Class A 160,532 6,502
-----------
22,015
</TABLE>
18 See the Financial Notes, which
are integral to this information.
<PAGE> 23
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
TRUCKING & FREIGHT 0.0%
-------------------------------------------------------------------------
PACCAR, Inc. 51,163 2,152
Ryder Systems, Inc. 38,862 768
-----------
2,920
UTILITIES: ELECTRIC & GAS 3.0%
-------------------------------------------------------------------------
- AES Corp. 305,300 17,249
Ameren Corp. 91,713 3,646
American Electric Power Co., Inc. 215,160 8,929
CP&L Energy, Inc. 106,016 4,274
Cinergy Corp. 105,600 3,234
CMS Energy Corp. 80,700 2,179
Coastal Corp. 143,042 10,791
Columbia Energy Group 52,974 3,811
Consolidated Edison, Inc. 140,791 4,954
Constellation Energy Group, Inc. 100,108 4,173
Dominion Resources, Inc. 159,055 9,474
DTE Energy Co. 95,403 3,446
Duke Energy Corp. 246,215 21,282
+ Dynegy, Inc., Class A 206,300 9,554
Edison International 218,229 5,210
El Paso Energy Corp. 154,879 9,709
Enron Corp. 495,378 40,652
Entergy Corp. 148,504 5,690
FirstEnergy Corp. 151,481 3,920
Florida Progress Corp. 65,400 3,478
FPL Group, Inc. 118,680 7,833
GPU, Inc. 80,852 2,673
+ KeySpan Corp. 89,200 3,139
- Niagara Mohawk Holdings, Inc. 106,902 1,710
NICOR, Inc. 30,801 1,088
ONEOK, Inc. 19,100 757
Peoples Energy Corp. 23,073 793
PG&E Corp. 257,216 6,929
Pinnacle West Capital Corp. 56,200 2,441
PPL Corp. 96,445 3,972
Public Service Enterprise Group, Inc. 143,385 5,950
Reliant Energy, Inc. 196,086 8,101
Sempra Energy 136,530 2,824
Southern Co. 433,531 12,735
TXU Corp. 176,587 6,545
Williams Cos., Inc. 295,964 12,375
-----------
255,520
</TABLE>
<TABLE>
<S> <C>
OTHER INVESTMENT COMPANIES
0.2% of investments
Provident Institutional
TempFund 16,410,160 16,410
</TABLE>
<TABLE>
<CAPTION>
U.S. TREASURY OBLIGATIONS
0.0% of investments
SECURITY FACE VALUE MKT. VALUE
RATE, MATURITY DATE ($ X 1,000) ($ X 1,000)
<S> <C> <C>
# U.S. Treasury Bills
5.96%-6.03%, 12/14/00 645 640
</TABLE>
--------------------------------------------------------------------------------
END OF PORTFOLIO HOLDINGS. For totals, please see the first page of holdings for
this fund.
See the Financial Notes, which 19
are integral to this information.
<PAGE> 24
SCHWAB S&P 500 FUND -- FINANCIALS
Statement of
ASSETS AND LIABILITIES
As of October 31, 2000. All numbers x 1,000 except NAV.
<TABLE>
<S> <C>
ASSETS
----------------------------------------------------------------------
Investments, at market value $8,420,533 a
Collateral held for securities on loan 115,423 b
Receivables:
Fund shares sold 8,715
Interest 123
Dividends 5,741
Investments sold 1,121
Income from lending securities 7
Most recent daily change in value of futures 239
Prepaid expenses + 201
------------
TOTAL ASSETS 8,552,103
LIABILITIES
----------------------------------------------------------------------
Collateral held for securities on loan 115,423 b
Payables:
Fund shares redeemed 8,635
Investments bought 12,253
Investment adviser and administrator fees 39
Transfer agent and shareholder service fees 93
Accrued expenses + 568
------------
TOTAL LIABILITIES 137,011
NET ASSETS
----------------------------------------------------------------------
TOTAL ASSETS 8,552,103
TOTAL LIABILITIES - 137,011
------------
NET ASSETS $8,415,092
NET ASSETS BY SOURCE
Capital received from investors 6,416,309
Net investment income not yet distributed 57,849
Net realized capital losses (126,013)
Net unrealized capital gains 2,066,947 c
</TABLE>
a The fund paid $6,353,069 for these securities. Not counting short-term
obligations and government securities, the fund paid $1,439,260 for securities
during the report period and received $756,490 from securities it sold or that
matured. This includes $7,140 in transactions with other SchwabFunds(R).
b Market value of securities loaned: $112,674.
c These derive from investments and futures. As of the report date, the fund had
thirty-three open S&P 500 futures contracts due to expire on December 15,
2000, with a contract value of $11,882 and unrealized losses of $517.
NET ASSET VALUE (NAV)
<TABLE>
<CAPTION>
SHARES
SHARE CLASS NET ASSETS / OUTSTANDING = NAV
<S> <C> <C> <C>
Investor Shares $3,617,623 163,340 $22.15
Select Shares(R) $4,356,661 196,122 $22.21
e.Shares(R) $ 440,808 19,881 $22.17
</TABLE>
<TABLE>
<CAPTION>
FEDERAL TAX DATA
--------------------------------------------------------
<S> <C>
COST BASIS OF PORTFOLIO $6,453,094
NET UNREALIZED GAINS AND LOSSES:
Gains $2,627,914
Losses + (660,992)
------------
$1,966,922
RECLASSIFICATIONS:
Capital received from investors $2
Reclassified as:
Net realized capital losses ($1)
Net investment income
not yet distributed ($1)
UNUSED CAPITAL LOSSES:
Expires 10/31 of: Loss amount
2008 $26,504
</TABLE>
20 See the Financial Notes, which
are integral to this information.
<PAGE> 25
Statement of
OPERATIONS
For November 1, 1999 through October 31, 2000. All numbers x 1,000.
<TABLE>
<CAPTION>
<S> <C>
INVESTMENT INCOME
----------------------------------------------------------------------
Dividends $91,714 a
Interest 1,181
Lending of securities + 780
------------
TOTAL INVESTMENT INCOME 93,675
NET REALIZED GAINS AND LOSSES
----------------------------------------------------------------------
Net realized losses on investments sold (113,542)
Net realized losses on futures contracts + (1,042)
------------
NET REALIZED LOSSES (114,584)
NET UNREALIZED GAINS AND LOSSES
----------------------------------------------------------------------
Net unrealized gains on investments 465,545
Net unrealized losses on futures contracts + (696)
------------
NET UNREALIZED GAINS 464,849
EXPENSES
----------------------------------------------------------------------
Investment adviser and administrator fees 17,543 b
Transfer agent and shareholder service fees:
Investor Shares 8,629 c
Select Shares(R) 4,123 c
e.Shares(R) 453 c
Trustees' fees 46 d
Custodian fees 350
Portfolio accounting fees 1,137
Professional fees 84
Registration fees 677
Shareholder reports 513
Interest expense 95
Proxy fees 614
Other expenses + 109
------------
Total expenses 34,373
Expense reduction - 12,482 e
------------
NET EXPENSES 21,891
INCREASE IN NET ASSETS FROM OPERATIONS
----------------------------------------------------------------------
TOTAL INVESTMENT INCOME 93,675
NET EXPENSES - 21,891
------------
NET INVESTMENT INCOME 71,784
NET REALIZED LOSSES (114,584) f
NET UNREALIZED GAINS + 464,849 f
------------
INCREASE IN NET ASSETS FROM OPERATIONS $422,049
</TABLE>
a An additional $430 was withheld for foreign taxes.
b Calculated as a percentage of average daily net assets: 0.20% of the first
$500 million and 0.17% of assets beyond that. Prior to February 29, 2000, the
percentages were 0.36% of the first $1 billion, 0.33% of the next $1 billion
and 0.31% of assets beyond that.
c Calculated as a percentage of average daily net assets: for transfer agent
services, 0.05% of the fund's assets; for shareholder services, 0.20%, 0.05%,
and 0.05% of the assets of each respective share class.
d For the fund's independent trustees only.
e Includes $6,009 from the investment adviser (CSIM) and $6,473 from the
transfer agent and shareholder service agent (Schwab). These reductions
reflect a guarantee by CSIM and Schwab to limit the operating expenses of this
fund through at least February 28, 2001, as follows:
<TABLE>
<CAPTION>
% OF AVERAGE
SHARE CLASS DAILY NET ASSETS
--------------------------------------------
<S> <C>
Investor Shares 0.35
Select Shares 0.19
e.Shares 0.28
</TABLE>
This limit does not include interest, taxes and certain non-routine expenses.
f These add up to a net gain on investments of $350,265.
See the Financial Notes, which 21
are integral to this information.
<PAGE> 26
SCHWAB S&P 500 FUND - FINANCIALS
Statements of
CHANGES IN NET ASSETS
For the current and prior report periods. All numbers x 1,000.
<TABLE>
<CAPTION>
OPERATIONS
----------------------------------------------------------------------------------
11/1/99-10/31/00 11/1/98-10/31/99
<S> <C> <C>
Net investment income $71,784 $65,370
Net realized gains or losses (114,584) 22,632
Net unrealized gains + 464,849 1,063,273
-----------------------------------
INCREASE IN NET ASSETS FROM OPERATIONS 422,049 1,151,275
DISTRIBUTIONS PAID
----------------------------------------------------------------------------------
DIVIDENDS FROM NET INVESTMENT INCOME
Investor Shares 27,441 18,212
Select Shares(R) 38,359 19,016
e.Shares(R) + 4,350 2,807
-----------------------------------
TOTAL DIVIDENDS FROM NET INVESTMENT INCOME 70,150 40,035 a
DISTRIBUTIONS FROM NET REALIZED GAINS
Investor Shares 9,855 --
Select Shares 11,814 --
e.Shares + 1,355 --
-----------------------------------
TOTAL DISTRIBUTIONS FROM NET REALIZED GAINS $23,024 $ --
</TABLE>
<TABLE>
<CAPTION>
TRANSACTIONS IN FUND SHARES
----------------------------------------------------------------------------------
11/1/99-10/31/00 11/1/98-10/31/99
QUANTITY VALUE QUANTITY VALUE
<S> <C> <C> <C> <C>
Shares sold:
Investor Shares 71,072 $1,573,083 94,157 $1,863,484
Select Shares 88,320 1,957,058 141,228 2,801,786
e.Shares + 8,742 193,616 18,523 365,979
-------------------------------------------------
TOTAL SHARES SOLD 168,134 $3,723,757 253,908 $5,031,249
Shares reinvested:
Investor Shares 1,645 $35,986 962 $17,632
Select Shares 2,108 46,155 950 17,420
e.Shares + 238 5,211 140 2,572
-------------------------------------------------
TOTAL SHARES REINVESTED 3,991 $87,352 2,052 $37,624
Shares redeemed:
Investor Shares 59,693 $1,315,607 58,283 $1,163,104
Select Shares 70,932 1,565,993 56,115 1,125,070
e.Shares + 9,591 210,667 14,615 288,838
-------------------------------------------------
TOTAL SHARES REDEEMED 140,216 $3,092,267 129,013 $2,577,012
NET INCREASE 31,909 $718,842 126,947 $2,491,861 b
</TABLE>
<TABLE>
<CAPTION>
SHARES OUTSTANDING AND NET ASSETS
----------------------------------------------------------------------------------
11/1/99-10/31/00 11/1/98-10/31/99
SHARES NET ASSETS SHARES NET ASSETS
<S> <C> <C> <C> <C>
Beginning of period 347,434 $7,367,375 220,487 $3,764,274
Total increase + 31,909 1,047,717 126,947 3,603,101 c
-------------------------------------------------
END OF PERIOD 379,343 $8,415,092 347,434 $7,367,375 d
</TABLE>
a UNAUDITED
For corporations, 100% of the fund's dividends for the report period qualify
for the dividends-received deduction.
b Represents shares sold plus shares reinvested, minus shares redeemed.
c Figures for shares represent the net changes in shares from the transactions
described above. Figures for net assets represent the changes in net assets
from operations plus the value of transactions in fund shares, minus
distributions paid.
d Includes net investment income not yet distributed in the amount of $57,849
for the current period and $56,216 for the prior period.
Percent of fund shares owned by other SchwabFunds(R) as of the end of the
current period:
<TABLE>
<S> <C>
SCHWAB MARKETTRACK PORTFOLIOS(R)
All Equity Portfolio 2.3%
Growth Portfolio 1.3%
Balanced Portfolio 0.9%
Conservative Portfolio 0.2%
SCHWAB ANNUITY PORTFOLIOS
Growth Portfolio II Less than 0.1%
</TABLE>
22 See the Financial Notes, which
are integral to this information.
<PAGE> 27
SCHWAB
1000 FUND(R)
[PHOTO OF GERI HOM]
"Both share classes of the fund tracked the performance of the Schwab 1000 Index
for the report period."
Portfolio Manager
Geri Hom
GERI HOM, a vice president of the investment adviser, has overall responsibility
for the management of the fund. Prior to joining the firm in 1995, she worked
for nearly 15 years in equity index management.
TICKER SYMBOLS
INVESTOR SHARES SNXFX
SELECT SHARES(R) SNXSX
--------------------------------------------------------------------------------
[INVESTMENT STYLE 1 AND MARKET CAP 1 GRAPHIC]
<TABLE>
<S> <C> <C>
VALUE BLEND GROWTH
X LARGE
MEDIUM
SMALL
</TABLE>
Because it includes so many U.S. stocks and industries, this fund could make
sense for long-term investors seeking broad diversification in a single
investment. It's also a logical choice for stock investors who want exposure
beyond the large-cap segment of the U.S. stock market.
--------------------------------------------------------------------------------
THE FUND'S GOAL IS TO MATCH THE TOTAL RETURN OF THE SCHWAB 1000 INDEX.(R)
MANAGER'S PERSPECTIVE
GIVEN THE VOLATILITY THAT PREVAILED IN EQUITY MARKETS, THE FUND PERFORMED
COMPARATIVELY WELL DURING THE REPORT PERIOD. A combination of factors caused
investors to trim their overall exposure to stocks. Among these factors were
high stock prices, uncertainty over the outcome of the presidential election and
potential interest rate hikes. Toward the end of the report period, evidence of
a slowing economy reduced fears of interest rate hikes. Ordinarily this might
have helped the market regain its footing, but concerns about high oil prices
kept stocks in flux.
OVER THE REPORT PERIOD, LARGE-CAP STOCKS RELINQUISHED THEIR FIVE-YEAR HOLD AS
THE STRONGEST PERFORMING ASSET CLASS. Small-cap stocks emerged as the leaders
this time, but mid-cap stocks also beat large-caps. This helped the Schwab 1000
Index slightly outperform the S&P 500(R) Index.
In addition to being broader than the S&P 500 and including a portion of the
mid-cap sector, the Schwab 1000 Index is more heavily weighted in the technology
and the healthcare sectors. These two sectors, while among the most volatile,
also contributed to the fund's returns for the report period.
1 Source: Morningstar, Inc. This style assessment is the result of comparing
the fund with the S&P 500 Index, based on P/E, P/B and median market cap. The
assessment reflects the fund's portfolio as of 10/31/00, which may have
changed since then, and is not a precise indication of risk or performance --
past, present or future.
23
<PAGE> 28
Schwab 1000 Fund(R)
PERFORMANCE: INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Investor Shares with the Schwab
1000 Index(R) and the Morningstar Large-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR 5 YEARS SINCE INCEPTION: 4/2/91
-------------------------- -------------------------- ------------------------
(0.24%) (0.43%) (0.46%)
-------------- ---------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Total Return 2 8.34% 8.58% 8.70% 1 20.98% 21.41% 18.64% 17.10% 17.56% n/a
% of Return Lost to Taxes 3.36% -- 19.77% 1 2.34% -- 12.82% n/a -- n/a
AFTER-TAX RETURN 2 8.06% -- 6.98% 1 20.49% -- 16.25% n/a -- n/a
</TABLE>
PERFORMANCE OF A $10,000 INVESTMENT
Shows performance since inception of a hypothetical $10,000 investment in the
fund's Investor Shares, compared to a similar investment in two indices: the
Schwab 1000 Index and the S&P 500(R) Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
INVESTOR
SHARES SCHWAB 1000 INDEX S&P 500 INDEX
<S> <C> <C> <C>
4/2/91 10000 10000 10000
4/30/91 9910 9898 9908
5/31/91 10320 10311 10335
6/30/91 9850 9840 9861
7/31/91 10320 10310 10321
8/31/91 10600 10591 10566
9/30/91 10460 10455 10389
10/31/91 10630 10625 10528
11/30/91 10240 10227 10104
12/31/91 11425 11412 11260
1/31/92 11283 11272 11050
2/29/92 11425 11415 11193
3/31/92 11171 11163 10975
4/30/92 11404 11392 11298
5/31/92 11404 11457 11353
6/30/92 11465 11257 11184
7/31/92 11726 11728 11641
8/31/92 11480 11486 11403
9/30/92 11623 11646 11537
10/31/92 11746 11763 11577
11/30/92 12208 12233 11971
12/31/92 12398 12428 12119
1/31/93 12502 12539 12220
2/28/93 12595 12632 12387
3/31/93 12896 12948 12648
4/30/93 12533 12583 12342
5/31/93 12896 12957 12673
6/30/93 12958 13024 12710
7/31/93 12905 12989 12659
8/31/93 13397 13492 13139
9/30/93 13355 13454 13038
10/31/93 13544 13654 13308
11/30/93 13355 13462 13181
12/31/93 13592 13700 13341
1/31/94 14005 14136 13794
2/28/94 13645 13781 13420
3/31/94 13042 13169 12837
4/30/94 13190 13326 13001
5/31/94 13349 13488 13213
6/30/94 12988 13127 12889
7/31/94 13405 13558 13312
8/31/94 13971 14147 13856
9/30/94 13651 13825 13518
10/31/94 13918 14095 13821
11/30/94 13416 13590 13318
12/31/94 13577 13767 13514
1/31/95 13923 14121 13864
2/28/95 14474 14700 14404
3/31/95 14852 15094 14829
4/30/95 15219 15476 15264
5/31/95 15770 16048 15874
6/30/95 16191 16490 16242
7/31/95 16807 17111 16779
8/31/95 16936 17245 16821
9/30/95 17606 17949 17531
10/31/95 17520 17859 17468
11/30/95 18276 18646 18233
12/31/95 18547 18924 18585
1/31/96 19095 19499 19217
2/29/96 19379 19789 19396
3/31/96 19554 19980 19582
4/30/96 19883 20321 19870
5/31/96 20354 20812 20380
6/30/96 20299 20779 20458
7/31/96 19335 19794 19554
8/31/96 19861 20327 19966
9/30/96 20967 21465 21088
10/31/96 21394 21899 21670
11/30/96 22938 23485 23308
12/31/96 22549 23103 22847
1/31/97 23846 24442 24272
2/28/97 23935 24528 24464
3/31/97 22870 23457 23461
4/30/97 24101 24696 24859
5/31/97 25631 26291 26371
6/30/97 26695 27402 27552
7/31/97 28857 29615 29743
8/31/97 27471 28216 28077
9/30/97 28946 29732 29613
10/31/97 27992 28756 28624
11/30/97 29167 29983 29949
12/31/97 29747 30582 30464
1/31/98 29960 30818 30802
2/28/98 32166 33116 33023
3/31/98 33801 34830 34714
4/30/98 34149 35211 35065
5/31/98 33398 34441 34462
6/30/98 34742 35824 35861
7/31/98 34260 35324 35481
8/31/98 29142 30049 30357
9/30/98 31023 32014 32303
10/31/98 33487 34602 34929
11/30/98 35570 36762 37046
12/31/98 37826 39090 39180
1/31/99 39259 40575 40818
2/28/99 37939 39256 39548
3/31/99 39462 40820 41130
4/30/99 41065 42505 42722
5/31/99 40117 41535 41714
6/30/99 42115 43637 44029
7/31/99 40772 42247 42655
8/31/99 40377 41900 42442
9/30/99 39304 40655 41279
10/31/99 41901 43397 43891
11/30/99 42917 44410 44784
12/31/99 45770 47386 47422
1/31/00 43622 45179 45041
2/29/00 43634 45237 44188
3/31/00 47406 49172 48510
4/30/00 45622 47326 47050
5/31/00 44429 46094 46085
6/30/00 45622 47357 47224
7/31/00 44952 46630 46487
8/31/00 47997 49800 49374
9/30/00 45781 47500 46767
10/31/00 45395 47121 46571
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category that had track records of at least one year and 1,082
funds with track records of at least five years. These funds may or may not
use tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
24
<PAGE> 29
PERFORMANCE: SELECT SHARES(R)
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Select Shares with the Schwab 1000
Index(R) and the Morningstar Large-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 5/19/97
------------------------ ------------------------
(0.12%) (0.27%)
-------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 8.46% 8.58% 8.70% 1 18.87% 19.14% n/a
% of Return Lost to Taxes 4.02% -- 19.77% 1 n/a -- n/a
AFTER-TAX RETURN 2 8.12% -- 6.98% 1 n/a -- n/a
</TABLE>
PERFORMANCE OF A $50,000 INVESTMENT
Shows performance since inception of a hypothetical $50,000 investment in the
fund's Select Shares, compared to a similar investment in two indices: the
Schwab 1000 Index and the S&P 500(R) Index.
[LINE GRAPH}
<TABLE>
<CAPTION>
SELECT
SHARES SCHWAB 1000 INDEX S&P 500 INDEX
<S> <C> <C> <C>
5/19/97 50000 50000 50000
5/31/97 51040 51064 50930
6/30/97 53180 53222 53212
7/31/97 57490 57518 57442
8/31/97 54750 54801 54225
9/30/97 57685 57746 57191
10/31/97 55785 55851 55281
11/30/97 58150 58233 57841
12/31/97 59325 59398 58836
1/31/98 59725 59855 59489
2/28/98 64145 64318 63778
3/31/98 67405 67648 67043
4/30/98 68100 68387 67720
5/31/98 66625 66893 66556
6/30/98 69305 69578 69258
7/31/98 68345 68606 68524
8/31/98 58140 58362 58629
9/30/98 61915 62179 62387
10/31/98 66825 67206 67459
11/30/98 71000 71400 71547
12/31/98 75505 75922 75668
1/31/99 78385 78805 78831
2/28/99 75750 76244 76379
3/31/99 78795 79282 79434
4/30/99 82015 82553 82509
5/31/99 80120 80671 80561
6/30/99 84110 84753 85033
7/31/99 81450 82052 82380
8/31/99 80665 81380 81968
9/30/99 78545 78960 79721
10/31/99 83725 84287 84767
11/30/99 85755 86255 86491
12/31/99 91470 92034 91585
1/31/00 87180 87747 86987
2/29/00 87225 87861 85341
3/31/00 94765 95504 93687
4/30/00 91200 91917 90867
5/31/00 88835 89525 89004
6/30/00 91220 91977 91203
7/31/00 89905 90566 89780
8/31/00 95990 96722 95356
9/30/00 91585 92255 90322
10/31/00 90810 91519 89942
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category that had track records of at least one year and 1,082
funds with track records of at least five years. These funds may or may not
use tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
25
<PAGE> 30
SCHWAB 1000 FUND(R)
FUND FACTS
<TABLE>
<CAPTION>
TOP TEN HOLDINGS 1 as of 10/31/00
<S> <C>
1 GENERAL ELECTRIC CO. 4.0%
2 CISCO SYSTEMS, INC. 2.8%
3 MICROSOFT CORP. 2.7%
4 EXXON MOBIL CORP. 2.3%
5 INTEL CORP. 2.2%
6 PFIZER, INC. 2.0%
7 CITIGROUP, INC. 1.7%
8 AMERICAN INTERNATIONAL GROUP, INC. 1.7%
9 MERCK & CO., INC. 1.5%
10 WAL-MART STORES, INC. 1.5%
--------------------------------------------------------------------------------
TOTAL PERCENTAGE OF INVESTMENTS 22.4%
</TABLE>
STATISTICS as of 10/31/00
<TABLE>
<CAPTION>
PEER GROUP
FUND AVERAGE 2
--------------------------------------------------------------------------------
<S> <C> <C>
Number of Holdings 938 137
--------------------------------------------------------------------------------
Median Market Cap ($ Mil) $68,803 $56,749
--------------------------------------------------------------------------------
Price/Earnings (P/E) Ratio 34.3 34.3
--------------------------------------------------------------------------------
Price/Book (P/B) Ratio 9.0 8.7
--------------------------------------------------------------------------------
12-Month Yield Investor Shares 0.65% 0.45%
--------------------------------------------------------------------------------
Portfolio Turnover Rate 9% 98%
--------------------------------------------------------------------------------
Three-Year Beta 1.00 0.95
--------------------------------------------------------------------------------
</TABLE>
EXPENSE RATIO as of 10/31/00
[BAR CHART]
<TABLE>
<S> <C>
INVESTOR SHARES 0.46% 3
SELECT SHARES(R) 0.35% 3
PEER GROUP AVERAGE 1.34% 2
</TABLE>
INDEX COMPOSITION BY INDUSTRY 4
These charts show the size of the ten largest industries in the Schwab 1000
Index.(R) As the charts show, the total portion represented by these industries
has been growing over the past five years.
[PIE CHART]
AS OF 10/31/00
--------------------------------------
<TABLE>
<S> <C> <C>
1 13.9% Business Machines
2 12.1% Drugs & Medicine
3 9.4% Electronics
4 7.5% Miscellaneous Finance
5 6.3% Telephone
6 5.7% Business Services
7 5.6% Producer Goods
8 5.3% Banks
9 5.1% Retail
10 4.0% Insurance
25.1% Other
</TABLE>
[PIE CHART]
AS OF 10/31/99
--------------------------------------
<TABLE>
<S> <C> <C>
1 12.5% Business Machines
2 10.5% Drugs & Medicine
3 8.4% Telephone
4 8.0% Electronics
5 6.7% Miscellaneous Finance
6 6.7% Banks
7 6.4% Retail
8 5.2% Producer Goods
9 4.7% Business Services
10 4.1% Media
26.8% Other
</TABLE>
[PIE CHART]
AS OF 10/31/95
--------------------------------------
<TABLE>
<S> <C> <C>
1 9.7% Drugs & Medicine
2 8.2% Telephone
3 6.9% Banks
4 6.4% Electronics
5 5.8% Business Machines
6 5.8% Food & Agriculture
7 5.6% Energy & Utilities
8 4.8% Producer Goods
9 4.8% Retail
10 4.4% Miscellaneous Finance
37.8% Other
</TABLE>
1 This list is not a recommendation of any security by the investment adviser.
Portfolio holdings may have changed since the report date.
2 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category.
3 Guaranteed by Schwab and the investment adviser through 2/28/01. The actual
expense ratio during the report period was 0.01% higher due to certain
non-routine expenses.
4 Source: Charles Schwab & Co., Inc.
26
<PAGE> 31
SCHWAB 1000 FUND(R) -- FINANCIALS
FINANCIAL TABLES
These pages provide additional data on the fund's performance, portfolio
holdings, expenses and business operations. These figures have been audited by
PricewaterhouseCoopers LLP.
Two other sections of this report provide context for the data in these
financials. THE FINANCIAL NOTES section contains information about the fund's
business structure, accounting practices and other matters, completing the data
given in these tables. The final section, HOW TO READ THIS REPORT, includes
guides designed to make the financials easy to read and understand.
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
11/1/99- 11/1/98- 11/1/97- 9/1/97- 9/1/96- 9/1/95
INVESTOR SHARES 10/31/00 10/31/99 10/31/98 10/31/97 8/31/97 8/31/96
<S> <C> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
--------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period 37.12 29.90 25.25 24.78 18.14 15.68
--------------------------------------------------------------------
Income from investment operations:
Net investment income 0.26 0.26 0.27 0.04 0.28 0.24
Net realized and unrealized gains 2.83 7.21 4.64 0.43 6.62 2.45
--------------------------------------------------------------------
Total income from investment operations 3.09 7.47 4.91 0.47 6.90 2.69
Less distributions:
Dividends from net investment income (0.26) (0.25) (0.26) -- (0.26) (0.23)
--------------------------------------------------------------------
Net asset value at end of period 39.95 37.12 29.90 25.25 24.78 18.14
====================================================================
Total return (%) 8.34 25.12 19.63 1.90 1 38.32 17.27
RATIOS/SUPPLEMENTAL DATA (%)
--------------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses to
average net assets 0.46 3 0.46 0.46 0.46 2 0.47 0.49
Expense reductions reflected in above ratio 0.04 0.05 0.05 0.04 2 0.06 0.08
Ratio of net investment income to
average net assets 0.63 0.78 1.02 1.00 2 1.33 1.66
Portfolio turnover rate 9 3 2 -- 2 2
Net assets, end of period ($ x 1,000,000) 5,083 4,925 3,657 2,611 2,499 1,560
</TABLE>
1 Not annualized.
2 Annualized.
3 Would have been 0.47% if certain non-routine expenses (proxy fees) had been
included.
See the Financial Notes, which 27
are integral to this information.
<PAGE> 32
SCHWAB 1000 FUND(R) -- FINANCIALS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
11/1/99- 11/1/98- 11/1/97- 9/1/97- 5/19/97 1 -
SELECT SHARES(R) 10/31/00 10/31/99 10/31/98 10/31/97 8/31/97
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
---------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period 37.16 29.93 25.26 24.79 22.64
---------------------------------------------------------------
Income from investment operations:
Net investment income 0.29 0.30 0.32 0.04 0.05
Net realized and unrealized gains 2.84 7.22 4.63 0.43 2.10
---------------------------------------------------------------
Total income from investment operations 3.13 7.52 4.95 0.47 2.15
Less distributions:
Dividends from net investment income (0.31) (0.29) (0.28) -- --
---------------------------------------------------------------
Net asset value at end of period 39.98 37.16 29.93 25.26 24.79
===============================================================
Total return (%) 8.46 25.29 19.79 1.90 2 9.50 2
RATIOS/SUPPLEMENTAL DATA (%)
---------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses
to average net assets 0.35 4 0.35 0.35 0.35 3 0.35 3
Expense reductions reflected in above ratio -- 0.02 0.04 0.06 3 0.33 3
Ratio of net investment income to
average net assets 0.74 0.89 1.11 1.11 3 1.26 3
Portfolio turnover rate 9 3 2 -- 2
Net assets, end of period ($ x 1,000,000) 2,159 2,214 1,041 426 347
</TABLE>
1 Commencement of operations.
2 Not annualized.
3 Annualized.
4 Would have been 0.36% if certain non-routine expenses (proxy fees) had been
included.
28 See the Financial Notes, which
are integral to this information.
<PAGE> 33
PORTFOLIO HOLDINGS
As of October 31, 2000
This section shows all the securities in the fund's portfolio and their market
value, as of the report date.
We use the symbols below to designate certain characteristics. With the top ten
holdings, the number in the circle is the security's rank among the top ten.
(1) Top ten holding
+ New holding (since 10/31/99)
- Non-income producing security
* American Depositary Receipt
# Collateral for open futures contracts
## Issuer is affiliated with the fund's adviser
The pie chart below shows the fund's major asset categories and the market value
and cost of the securities in each category.
ALL DOLLAR VALUES ARE IN THOUSANDS.
[PIE CHART]
<TABLE>
<S> <C>
99.9% COMMON STOCK
Market Value: $7,587,508
Cost: $4,176,660
0.0% OTHER INVESTMENT COMPANIES
Market Value: $3,284
Cost: $3,284
0.1% SHORT TERM INVESTMENT
Market Value: $7.542
Cost: $7,542
0.0% U.S. TREASURY OBLIGATIONS
Market Value: $313
Cost: $313
----------------------------------
100.0% TOTAL INVESTMENTS
Market Value: $7,598,647
Cost: $4,187,799
</TABLE>
COMMON STOCK 99.9% of investments
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
AEROSPACE / DEFENSE 1.3%
-----------------------------------------------------------------------------
B.F. Goodrich Co. 56,792 2,325
Boeing Co. 498,982 33,837
Crane Co. 32,850 860
General Dynamics Corp. 113,600 8,130
- Litton Industries, Inc. 30,500 1,584
Lockheed Martin Corp. 235,384 8,439
Northrop Grumman Corp. 39,900 3,352
Raytheon Co., Class A 56,100 1,795
Raytheon Co., Class B 189,000 6,461
Rockwell International Corp. 94,600 3,719
Textron, Inc. 80,400 4,055
TRW, Inc. 66,700 2,801
United Technologies Corp. 260,527 18,188
-----------
95,546
AIR TRANSPORTATION 0.4%
-----------------------------------------------------------------------------
- AMR Corp. 85,200 2,790
- Continental Airlines, Inc., Class B 39,400 2,069
Delta Air Lines, Inc. 67,400 3,185
- FedEx Corp. 163,860 7,678
Galileo International, Inc. 50,300 993
- Northwest Airlines Corp., Class A 47,100 1,342
Southwest Airlines Co. 277,350 7,904
- U.S. Airways Group, Inc. 36,900 1,393
UAL Corp. 27,600 1,047
-----------
28,401
ALCOHOLIC BEVERAGES 0.4%
-----------------------------------------------------------------------------
Adolph Coors Co., Class B 21,000 1,337
Anheuser-Busch Cos., Inc. 501,600 22,948
Brown-Forman Corp., Class B 36,700 2,234
-----------
26,519
APPAREL 0.2%
-----------------------------------------------------------------------------
- Abercrombie & Fitch Co., Class A 58,000 1,367
- Jones Apparel Group, Inc. 65,200 1,813
Liz Claiborne, Inc. 35,000 1,488
Nike, Inc., Class B 149,400 5,967
+ Talbots, Inc. 20,500 1,621
VF Corp. 63,100 1,723
WestPoint Stevens, Inc. 18,000 129
-----------
14,108
AUTOMOTIVE PRODUCTS / MOTOR VEHICLES 1.2%
-----------------------------------------------------------------------------
ArvinMeritor, Inc. 39,400 660
Cummins Engine Co., Inc. 24,800 843
Dana Corp. 85,489 1,897
Danaher Corp. 80,800 5,101
Eaton Corp. 39,100 2,661
Federal-Mogul Corp. 9,600 31
Ford Motor Co. 1,051,770 27,477
General Motors Corp. 298,134 18,522
- General Motors Corp., Class H 418,294 13,553
Genuine Parts Co. 95,575 2,037
Goodyear Tire & Rubber Co. 85,500 1,582
</TABLE>
See the Financial Notes, which 29
are integral to this information.
<PAGE> 34
SCHWAB 1000 FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Harley-Davidson, Inc. 170,800 8,230
- Lear Corp. 36,000 981
- Navistar International Corp. 36,000 1,190
-+ O'Reilly Automotive, Inc. 27,800 500
- SPX Corp. 20,000 2,473
- United Rentals, Inc. 40,000 860
-----------
88,598
BANKS 5.5%
-----------------------------------------------------------------------------
AmSouth Bancorp. 208,475 2,906
Associated Banc-Corp. 38,196 919
BancWest Corp. 40,000 818
Bank of America Corp. 906,691 43,578
Bank of New York Co., Inc. 410,200 23,612
Bank One Corp. 642,393 23,447
Banknorth Group, Inc. 75,800 1,374
BB&T Corp. 221,000 7,044
Centura Banks, Inc. 22,000 846
Chase Manhattan Corp. 727,090 33,083
+ Citizens Banking Corp. 26,300 626
City National Corp. 25,000 859
The Colonial BancGroup, Inc. 65,000 573
Comerica, Inc. 85,296 5,144
Commerce Bancorp., Inc. N.J. 21,000 1,272
Commerce Bancshares, Inc. 31,963 1,149
Compass Bancshares, Inc. 69,412 1,262
Cullen/Frost Bankers, Inc. 29,700 989
Fifth Third Bancorp. 256,189 13,162
+ First Midwest Bancorp., Inc. 22,600 566
First Tennessee National Corp. 72,600 1,670
First Union Corp. 546,722 16,573
First Virginia Banks, Inc. 24,625 1,019
Firstar Corp. 530,535 10,445
FirstMerit Corp. 46,800 1,068
FleetBoston Financial Corp. 499,940 18,998
Fulton Financial Corp. 47,643 1,042
Golden West Financial Corp. 89,700 5,029
GreenPoint Financial Corp. 56,800 1,690
Hibernia Corp., Class A 80,000 955
Hudson United Bancorp. 22,660 507
Huntington Bancshares, Inc. 134,535 1,934
J.P. Morgan & Co., Inc. 90,000 14,895
KeyCorp, Inc. 239,946 5,924
M&T Bank Corp. 26,001 1,305
Marshall & Ilsley Corp. 57,185 2,591
Mellon Financial Corp. 278,788 13,452
Mercantile Bankshares Corp. 40,675 1,530
National City Corp. 335,900 7,180
National Commerce Bancorp. 111,450 2,368
North Fork Bancorp., Inc. 96,900 1,956
Northern Trust Corp. 123,800 10,569
Old Kent Financial Corp. 74,167 2,054
Old National Bancorp. 29,559 872
Pacific Century Financial Corp. 40,350 512
Peoples Bank-Bridgeport 38,000 770
PNC Financial Services Group 165,130 11,043
Provident Financial Group, Inc. 27,000 817
Providian Financial Corp. 79,050 8,221
Regions Financial Corp. 121,765 2,869
+ Roslyn Bancorp., Inc. 36,700 796
-+ S1 Corp. 30,200 364
+ Sky Financial Group, Inc. 48,730 810
SouthTrust Corp. 92,787 3,004
State Street Corp. 88,700 11,064
Summit Bancorp. 96,050 3,602
SunTrust Banks, Inc. 166,456 8,125
Synovus Financial Corp. 157,962 3,406
Trustmark Corp. 44,000 836
U.S. Bancorp. 412,798 9,985
Union Planters Corp. 73,900 2,499
UnionBanCal Corp. 90,600 1,903
Valley National Bancorp. 38,587 1,068
Wachovia Corp. 111,349 6,013
Wells Fargo & Co. 924,440 42,813
Westamerica Bancorp. 16,800 604
Wilmington Trust Corp. 18,200 958
Zions Bancorp. 46,600 2,677
-----------
413,614
BUSINESS MACHINES & SOFTWARE 13.9%
-----------------------------------------------------------------------------
- 3Com Corp. 194,350 3,450
- Adaptec, Inc. 45,400 718
Adobe Systems, Inc. 136,800 10,405
- Apple Computer, Inc. 181,700 3,555
Autodesk, Inc. 27,200 600
- BMC Software, Inc. 122,000 2,478
</TABLE>
30 See the Financial Notes, which
are integral to this information.
<PAGE> 35
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Cabletron Systems, Inc. 102,400 2,778
- Ceridian Corp. 80,000 2,000
-(2)Cisco Systems, Inc. 3,942,700 212,412
Comdisco, Inc. 85,066 1,047
Compaq Computer Corp. 941,868 28,642
- Compuware Corp. 179,600 1,414
- Comverse Technology, Inc. 86,400 9,655
- Dell Computer Corp. 1,437,400 42,403
Diebold, Inc. 35,818 931
- EMC Corp. 1,211,900 107,935
- Gateway, Inc. 182,000 9,393
Hewlett-Packard Co. 1,108,000 51,453
- Informix Corp. 146,900 624
-+ Integrated Device Technology, Inc. 56,800 3,199
International Business Machines Corp. 974,800 96,018
- Lexmark International Group, Inc., Class A 71,000 2,911
- Microchip Technology, Inc. 67,500 2,135
-+ Micromuse, Inc. 19,100 3,241
-(3)Microsoft Corp. 2,923,700 201,370
- NCR Corp. 54,451 2,348
- Network Appliance, Inc. 173,700 20,670
- Novell, Inc. 170,800 1,537
- Novellus Systems, Inc. 72,700 2,976
- Oracle Corp. 3,131,514 103,340
Pitney Bowes, Inc. 141,100 4,189
- Seagate Technology, Inc. 126,560 8,843
- Silicon Graphics, Inc. 102,100 459
- Storage Technology Corp. 55,600 542
- Sun Microsystems, Inc. 880,700 97,648
-+ Sybase, Inc. 44,600 934
- Tech Data Corp. 28,000 1,166
-+ The Titan Corp. 27,700 370
Total System Services, Inc. 102,700 1,695
- Unisys Corp. 176,150 2,246
-+ Visual Networks, Inc. 13,800 51
Xerox Corp. 363,950 3,071
-+ Xircom, Inc. 16,300 230
-----------
1,053,082
BUSINESS SERVICES 6.1%
-----------------------------------------------------------------------------
- ACNielsen Corp. 35,000 838
- Affiliated Computer Services, Inc., Class A 30,000 1,671
-+ Affymetrix, Inc. 30,400 1,683
- Allied Waste Industries, Inc. 109,065 1,009
- America Online, Inc. 1,281,515 64,627
- American Management Systems, Inc. 22,000 476
- Apollo Group, Inc., Class A 42,500 1,663
- At Home Corp., Class A 208,396 2,149
Automatic Data Processing, Inc. 347,300 22,683
- Autonation, Inc. 199,600 1,347
-+ BEA Systems, Inc. 137,200 9,844
-+ BroadVision, Inc. 139,000 4,135
- CDW Computer Centers, Inc. 52,000 3,351
- Cendant Corp. 403,540 4,842
- Checkfree Corp. 41,300 2,055
- Ciber, Inc. 26,400 206
Cintas Corp. 92,800 4,304
- Citrix Systems, Inc. 104,200 2,305
Computer Associates International, Inc. 328,379 10,467
- Computer Sciences Corp. 94,196 5,934
- Concord EFS, Inc. 117,612 4,859
-+ Convergys Corp. 86,300 3,759
-+ Credence Systems, Corp. 27,800 521
- CSG Systems International, Inc. 29,000 1,347
Deluxe Corp. 40,000 903
- DeVry, Inc. 38,700 1,429
-+ DoubleClick, Inc. 64,700 1,051
- DST Systems, Inc. 70,000 4,314
-+ Dun & Bradstreet Corp. 44,800 969
- Earthlink, Inc. 49,070 320
-+ eBay, Inc. 145,600 7,498
Ecolab, Inc. 72,800 2,853
Electronic Data Systems Corp. 257,200 12,072
-+ Entrust Technologies, Inc. 24,600 755
Equifax, Inc. 78,500 2,708
Exelon Corp. 189,787 11,411
First Data Corp. 234,302 11,744
- Fiserv, Inc. 70,693 3,707
</TABLE>
See the Financial Notes, which 31
are integral to this information.
<PAGE> 36
SCHWAB 1000 FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
H&R Block, Inc. 53,700 1,916
-+ HNC Software, Inc. 13,700 278
- I2 Technologies, Inc. 107,000 18,190
- Icos Corp. 25,500 1,310
IMS Health, Inc. 164,200 3,879
Interpublic Group of Cos., Inc. 170,100 7,304
- Intuit, Inc. 112,500 6,912
- J.D. Edwards & Co. 65,000 1,682
- Keane, Inc. 39,000 507
- Lamar Advertising Co. 41,500 1,992
- Legato Systems, Inc. 46,100 411
-+ Macrovision Corp. 21,800 1,589
Manpower, Inc. 44,400 1,546
- MarchFirst, Inc. 60,950 354
-+ Mercury Interactive Corp. 44,300 4,917
+ Metris Cos., Inc. 38,550 1,248
-+ National Instruments Corp. 33,200 1,550
National Service Industries, Inc. 22,700 464
-+ NCO Group, Inc. 14,200 311
- Network Associates, Inc. 76,250 1,468
- New Era of Networks, Inc. 10,000 156
- NOVA Corp. 36,000 565
Omnicom Group, Inc. 98,700 9,105
-+ Open Market, Inc. 20,900 69
- Parametric Technology Corp. 142,400 1,753
Paychex, Inc. 209,542 11,878
- PeopleSoft, Inc. 155,400 6,782
-+ Peregrine Systems, Inc. 76,800 1,843
- Pixar, Inc. 26,300 868
-+ Polycom, Inc. 39,400 2,561
-+ Profit Recovery Group International, Inc. 21,800 117
-+ PSINet, Inc. 83,800 558
-+ Qlogic Corp. 49,000 4,741
-+ RealNetworks, Inc. 72,600 1,496
Reynolds & Reynolds Co., Class A 45,400 812
- Robert Half International, Inc. 109,300 3,334
-+ RSA Security, Inc. 22,200 1,288
- Safety-Kleen, Corp. 44,000 6
-+ Sandisk Corp. 36,200 1,945
- Sapient Corp. 63,400 2,255
-+ SDL, Inc. 42,200 10,940
SEI Investments Co. 29,500 2,677
The ServiceMaster Co. 155,000 1,414
- Siebel Systems, Inc. 231,600 24,304
- Six Flags, Inc. 43,700 683
- Sungard Data Systems, Inc. 73,000 3,732
- Sykes Enterprises, Inc. 15,000 81
- Symantec Corp. 33,800 1,320
- Synopsys, Inc. 38,800 1,353
-+ Technology Solutions Co. 25,200 60
-+ Teletech Holdings, Inc. 34,600 960
-+ TMP Worldwide, Inc. 49,500 3,446
True North Communications, Inc. 27,700 1,044
Tyco International Ltd. 40,351 2,287
-+ VeriSign, Inc. 107,435 14,181
- VERITAS Software Corp. 223,150 31,468
-+ Verity, Inc. 17,100 402
Viad Corp. 53,100 1,135
- Vitesse Semiconductor Corp. 102,900 7,197
Waste Management, Inc. 344,175 6,884
- Wind River Systems, Inc. 38,800 1,593
- Yahoo!, Inc. 303,400 17,787
-----------
462,717
CHEMICAL 0.9%
-----------------------------------------------------------------------------
Air Products & Chemicals, Inc. 127,200 4,746
Cabot Corp. 37,800 832
Crompton Corp. 47,000 376
Dow Chemical Co. 375,800 11,509
E.I. du Pont de Nemours & Co. 579,489 26,294
Eastman Chemical Co. 41,725 1,789
Great Lakes Chemical Corp. 29,000 968
Hercules, Inc. 54,850 1,004
Lubrizol Corp. 31,700 687
Lyondell Chemical Co. 61,300 881
Millennium Chemicals, Inc. 35,600 574
PPG Industries, Inc. 95,700 4,271
Praxair, Inc. 87,100 3,244
Rohm & Haas Co. 119,614 3,596
</TABLE>
32 See the Financial Notes, which
are integral to this information.
<PAGE> 37
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
RPM, Inc. 58,543 523
Sigma-Aldrich Corp. 47,000 1,680
Solutia, Inc. 55,000 701
Union Carbide Corp. 73,000 3,139
Valspar Corp. 21,600 590
-----------
67,404
CONSTRUCTION 0.3%
-----------------------------------------------------------------------------
Armstrong Holdings, Inc. 20,200 58
Centex Corp. 33,000 1,221
Clayton Homes, Inc. 64,182 590
Fluor Corp. 39,000 1,365
Johns Manville Corp. 66,800 614
Lafarge Corp. 38,100 719
Martin Marietta Materials, Inc. 26,000 998
Masco Corp. 252,600 4,720
-+ Sawtek, Inc. 23,900 1,216
Sherwin-Williams Co. 90,000 1,952
Southdown, Inc. 20,200 1,432
The Stanley Works 48,800 1,299
USG Corp. 25,700 439
Vulcan Materials Co. 59,400 2,495
-----------
19,118
CONSUMER: DURABLE 0.2%
-----------------------------------------------------------------------------
Black & Decker Corp. 46,500 1,750
+ Ethan Allen Interiors, Inc. 22,400 655
Hillenbrand Industries, Inc. 37,000 1,711
Leggett & Platt, Inc. 111,600 1,827
- Linens 'N Things, Inc. 20,000 615
Maytag Corp. 45,850 1,312
- Mohawk Industries, Inc. 25,000 545
Shaw Industries, Inc. 71,200 1,322
Whirlpool Corp. 40,900 1,779
-----------
11,516
CONSUMER: NONDURABLE 0.8%
-----------------------------------------------------------------------------
American Greetings Corp., Class A 39,200 713
- Brinker International, Inc. 35,000 1,374
- Catalina Marketing Corp. 30,000 1,178
Darden Restaurants, Inc. 78,600 1,769
- Electronic Arts, Inc. 80,800 4,040
Fastenal Co. 20,700 1,189
Fortune Brands, Inc. 90,300 2,658
Harcourt General, Inc. 40,200 2,253
Hasbro, Inc. 95,087 1,022
- International Game Technology 44,600 1,633
+ International Speedway Corp., Class A 30,100 967
Lancaster Colony Corp. 24,450 578
Mattel, Inc. 230,520 2,982
McDonald's Corp. 728,900 22,596
Newell Rubbermaid, Inc. 145,209 2,786
- Outback Steakhouse, Inc. 46,875 1,336
- Service Corp. International 16,200 37
- Sotheby's Holdings, Inc., Class A 30,000 816
- Starbucks Corp. 104,000 4,648
- Tricon Global Restaurants, Inc. 80,860 2,426
Wendy's International, Inc. 63,500 1,381
-----------
58,382
CONTAINERS 0.1%
-----------------------------------------------------------------------------
Bemis Co., Inc. 28,400 735
Crown Cork & Seal Co., Inc. 69,600 635
- Owens-Illinois, Inc. 64,900 385
- Sealed Air Corp. 44,199 2,127
Sonoco Products Co. 54,641 1,055
-----------
4,937
ELECTRONICS 9.3%
-----------------------------------------------------------------------------
- Acxiom Corp. 48,800 1,964
- ADC Telecommunications, Inc. 426,800 9,123
- Adelphia Communications Corp., Class A 54,507 1,809
-+ Advanced Fibre Communications, Inc. 44,000 1,433
- Advanced Micro Devices, Inc. 172,200 3,896
-+ Alpha Industries, Inc. 12,800 510
- Altera Corp. 228,800 9,367
- American Power Conversion Corp. 103,000 1,333
-+ Amphenol Corp., Class A 22,800 1,465
- Analog Devices, Inc. 197,000 12,805
- Andrew Corp. 44,412 1,169
-+ Antec Corp. 23,000 280
- Applied Materials, Inc. 449,100 23,858
- Arrow Electronics, Inc. 53,800 1,722
</TABLE>
See the Financial Notes, which 33
are integral to this information.
<PAGE> 38
SCHWAB 1000 FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
-+ Aspect Communications Corp. 26,900 443
- Atmel Corp. 254,900 3,808
Avnet, Inc. 48,800 1,312
AVX Corp. 96,800 2,771
-+ Broadcom Corp., Class A 123,600 27,486
- Cadence Design Systems, Inc. 134,350 3,451
- CIENA Corp. 157,300 16,536
- CMGI, Inc. 150,500 2,540
-+ CommScope, Inc. 28,700 726
-+ Cree, Inc. 19,600 1,945
+ CTS Corp. 15,600 670
-+ Cypress Semiconductor Corp. 66,700 2,497
- Dallas Semiconductor Corp. 33,600 1,331
- Electronics for Imaging, Inc. 31,000 481
-+ Emulex Corp. 20,000 2,938
- Gentex Corp. 45,000 1,114
-+ Getty Images, Inc. 27,700 879
-+ Harmonic, Inc. 23,965 347
Harris Corp. 36,600 1,160
-+ Imation Corp. 20,100 398
(5)Intel Corp. 3,730,200 167,859
-+ Internet Security Systems 23,000 2,030
ITT Industries, Inc. 50,600 1,648
- JDS Uniphase Corp. 518,900 42,258
-+ Kemet Corp. 48,600 1,355
- KLA-Tencor Corp. 95,000 3,212
-+ L-3 Communications Holdings, Inc. 18,000 1,187
-+ Lam Research Corp. 66,900 1,296
Linear Technology Corp. 172,900 11,163
- Loral Space & Communications Corp. 143,800 818
- LSI Logic Corp. 171,900 5,651
Lucent Technologies, Inc. 1,853,769 43,216
- Macromedia, Inc. 30,000 2,312
- Maxim Integrated Products, Inc. 158,400 10,504
- Metromedia Fiber Network, Inc., Class A 246,600 4,685
- Micron Technology, Inc. 312,000 10,842
Molex Inc., Class A 56,900 2,237
Molex, Inc. 112,821 6,092
Moody's Corp. 89,600 2,358
Motorola, Inc. 1,210,486 30,187
- National Semiconductor Corp. 98,500 2,561
- Nextel Communications, Inc., Class A 423,200 16,267
PE Corp.--PE Biosystems Group 120,000 14,040
- Per-Se Technologies, Inc. 488 --
PerkinElmer, Inc. 27,100 3,238
-+ Powerwave Technologies, Inc. 25,000 1,203
- QUALCOMM, Inc. 414,000 26,955
- Rambus, Inc. 52,800 2,373
- Rational Software Corp. 103,200 6,160
-+ RF Micro Devices, Inc. 89,800 1,790
- Sanmina Corp. 83,900 9,591
- SCI Systems, Inc. 78,900 3,393
Scientific-Atlanta, Inc. 89,400 6,118
-+ Semtech Corp. 40,400 1,303
-+ Sensormatic Electronics Corp. 42,600 767
- Solectron Corp. 333,100 14,656
Symbol Technologies, Inc. 83,980 3,816
Tektronix, Inc. 26,600 1,895
- Tellabs, Inc. 226,800 11,326
- Teradyne, Inc. 95,500 2,984
-+ Terayon Communication Systems, Inc. 30,200 676
Texas Instruments, Inc. 960,755 47,137
- Thermo Electron Corp. 95,784 2,778
Thomas & Betts Corp. 24,400 369
-+ TranSwitch Corp. 45,300 2,616
-+ Triquint Semiconductor, Inc. 43,500 1,667
- Univision Communications, Inc., Class A 114,000 4,361
-+ Vicor Corp. 29,700 1,604
-+ Vishay Intertechnology, Inc. 76,750 2,303
- VISX, Inc. 33,500 718
- Waters Corp. 78,400 5,689
-+ Western Wireless Corp., Class A 28,100 1,335
- Xilinx, Inc. 181,600 13,155
-----------
709,321
</TABLE>
34 See the Financial Notes, which
are integral to this information.
<PAGE> 39
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
ENERGY: RAW MATERIALS 1.0%
-----------------------------------------------------------------------------
Anadarko Petroleum Corp. 133,780 8,569
Apache Corp. 66,000 3,651
Baker Hughes, Inc. 183,820 6,319
-+ BJ Services Co. 45,800 2,402
Burlington Resources, Inc. 118,367 4,261
Cooper Cameron Corp. 35,000 1,908
+ Devon Energy Corp. 70,630 3,560
+ Eastern Enterprises 15,000 966
ENSCO International, Inc. 77,800 2,587
EOG Resources, Inc. 64,800 2,552
- Global Marine, Inc. 94,500 2,504
Halliburton Co. 246,860 9,149
+ Mitchell Energy & Development Corp., Class A 27,200 1,251
- Nabors Industries, Inc. 81,000 4,123
Noble Affiliates, Inc. 31,000 1,137
- Noble Drilling Corp. 75,000 3,117
Occidental Petroleum Corp. 204,300 4,060
- R&B Falcon Corp. 105,000 2,625
-+ Rowan Cos., Inc. 52,600 1,325
- Smith International, Inc. 27,000 1,904
Tidewater, Inc. 30,900 1,427
Valero Energy Corp. 34,000 1,124
- Weatherford International, Inc. 62,930 2,297
-----------
72,818
FOOD & AGRICULTURE 2.9%
-----------------------------------------------------------------------------
Archer-Daniels-Midland Co. 350,668 3,857
Campbell Soup Co. 234,400 6,856
Coca-Cola Co. 1,375,000 83,016
Coca-Cola Enterprises, Inc. 232,000 4,263
ConAgra, Inc. 295,359 6,313
+ Corn Products International, Inc. 20,500 515
Dean Foods Co. 21,150 677
Flowers Industries, Inc. 55,500 853
General Mills, Inc. 162,200 6,772
H.J. Heinz Co. 193,700 8,123
Hershey Foods Corp. 76,100 4,133
Hormel Foods Corp. 82,800 1,392
IBP, Inc. 58,400 1,201
IMC Global, Inc. 62,360 807
Interstate Bakeries Corp. 37,200 521
Kellogg Co. 224,800 5,704
McCormick & Co., Inc. 38,400 1,217
Nabisco Group Holdings Corp. 178,236 5,147
Nabisco Holdings Corp., Class A 28,800 1,557
PepsiCo, Inc. 801,100 38,803
Quaker Oats Co. 73,100 5,962
Ralston Purina Group 168,300 4,081
Sara Lee Corp. 480,400 10,359
- Suiza Foods Corp. 17,300 801
Supervalu, Inc. 72,000 1,107
Sysco Corp. 186,800 9,749
Tyson Foods, Inc., Class A 129,300 1,447
Whitman Corp. 72,800 946
Wm. Wrigley Jr. Co. 63,400 5,021
-----------
221,200
GOLD 0.0%
-----------------------------------------------------------------------------
Homestake Mining Co. 142,800 589
Newmont Mining Corp. 93,038 1,262
-----------
1,851
HEALTHCARE / DRUGS & MEDICINE 12.1%
-----------------------------------------------------------------------------
Abbott Laboratories 861,200 45,482
Aetna, Inc. 78,065 4,513
Allergan, Inc. 72,100 6,061
- ALZA Corp. 63,700 5,156
American Home Products Corp. 724,300 45,993
- Amgen, Inc. 571,600 33,117
-+ Andrx Group 38,000 2,736
Bausch & Lomb, Inc. 29,000 1,118
Baxter International, Inc. 161,900 13,306
Beckman Coulter, Inc. 17,500 1,226
Becton, Dickinson & Co. 138,000 4,623
- Biogen, Inc. 84,600 5,092
Biomet, Inc. 97,550 3,530
- Boston Scientific Corp. 224,942 3,585
Bristol-Myers Squibb Co. 1,090,400 66,446
C.R. Bard, Inc. 33,600 1,407
Cardinal Health, Inc. 156,920 14,868
- Chiron Corp. 104,612 4,531
Dentsply International, Inc. 33,000 1,145
</TABLE>
See the Financial Notes, which 35
are integral to this information.
<PAGE> 40
SCHWAB 1000 FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Eli Lilly & Co. 627,068 56,044
-+ Enzon, Inc. 22,100 1,575
-+ First Health Group Corp. 26,900 1,049
- Forest Laboratories, Inc., Class A 48,400 6,413
- Genzyme Corp. -- General Division 47,700 3,387
- Gilead Sciences, Inc. 26,000 2,236
- Guidant Corp. 168,972 8,945
HCA--The Healthcare Co. 308,672 12,328
- Health Management Associates, Inc., Class A 137,628 2,727
- HealthSouth Corp. 210,200 2,522
-+ Human Genome Sciences, Inc. 60,200 5,321
- Humana, Inc. 88,500 1,073
ICN Pharmaceuticals, Inc. 45,174 1,719
-+ Idec Pharmaceuticals Corp. 24,800 4,864
- Immunex Corp. 278,300 11,845
- IVAX Corp. 97,500 4,241
Johnson & Johnson 772,538 71,170
-+ King Pharmaceuticals, Inc. 91,600 4,105
- Lincare Holdings, Inc. 30,000 1,262
- Manor Care, Inc. 57,600 961
McKesson HBOC, Inc. 154,028 4,322
- Medimmune, Inc. 116,700 7,629
Medtronic, Inc. 665,600 36,150
(9)Merck & Co., Inc. 1,278,708 115,004
-+ Millennium Pharmaceuticals, Inc. 110,100 7,989
- Minimed, Inc. 40,000 2,918
Mylan Laboratories, Inc. 69,350 1,942
Omnicare, Inc. 51,100 894
- Oxford Health Plans, Inc. 45,900 1,549
- PacifiCare Health Systems, Inc. 21,164 221
- Patterson Dental Co. 37,000 1,159
(6)Pfizer, Inc. 3,507,852 151,495
Pharmacia Corp. 719,500 39,573
- Quintiles Transnational Corp. 64,060 893
Schering-Plough Corp. 813,200 42,032
- Sepracor, Inc. 40,500 2,759
- St. Jude Medical, Inc. 46,450 2,555
Stryker Corp. 107,200 5,052
- Sybron International Corp. 59,600 1,475
- Tenet Healthcare Corp. 172,373 6,776
- Trigon Healthcare, Inc. 20,000 1,434
UnitedHealth Group, Inc. 96,400 10,544
- Watson Pharmaceuticals, Inc. 57,000 3,566
- Wellpoint Health Networks, Inc. 36,125 4,224
-----------
919,877
HOUSEHOLD PRODUCTS 1.4%
-----------------------------------------------------------------------------
Alberto-Culver Co., Class B 33,700 1,131
Avon Products, Inc. 139,400 6,761
Clorox Co. 129,700 5,788
Colgate-Palmolive Co. 322,200 18,932
Dial Corp. 54,100 605
Estee Lauder Cos., Inc., Class A 72,000 3,344
Gillette Co. 582,910 20,329
International Flavors & Fragrances, Inc. 58,500 980
Procter & Gamble Co. 726,100 51,871
-----------
109,741
INSURANCE 3.9%
-----------------------------------------------------------------------------
21st Century Insurance Group 47,000 778
AFLAC, Inc. 153,950 11,248
- Alleghany Corp. 4,112 790
Allmerica Financial Corp. 30,000 1,892
Allstate Corp. 409,348 16,476
AMBAC Financial Group, Inc. 44,800 3,576
American Financial Group, Inc. 34,100 731
American General Corp. 139,493 11,229
(8)American International Group, Inc. 1,286,112 126,039
American National Insurance Co. 14,500 982
Aon Corp. 141,112 5,847
Chubb Corp. 96,500 8,148
CIGNA Corp. 95,200 11,610
Cincinnati Financial Corp. 88,614 3,257
- CNA Financial Corp. 105,700 3,858
Conseco, Inc. 166,335 1,154
Erie Indemnity Co., Class A 40,000 1,118
Everest Re Group Ltd. 31,000 1,817
Hartford Financial Services Group, Inc. 124,200 9,245
Jefferson-Pilot Corp. 56,725 3,900
Leucadia National Corp. 30,000 746
</TABLE>
36 See the Financial Notes, which are
integral to this information.
<PAGE> 41
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Lincoln National Corp. 107,800 5,215
Loew's Corp. 54,900 4,992
Marsh & McLennan Cos., Inc. 149,900 19,599
MBIA, Inc. 54,000 3,925
Mercury General Corp. 31,400 1,150
MGIC Investment Corp. 60,500 4,122
+ Mony Group, Inc. 25,900 1,065
Old Republic International Corp. 61,275 1,593
The PMI Group, Inc. 25,100 1,854
Progressive Corp. 39,900 3,920
Protective Life Corp. 32,600 754
+ Radian Group, Inc. 20,900 1,481
Reinsurance Group of America, Inc. 27,200 1,017
SAFECO Corp. 70,600 1,708
St. Paul Cos., Inc. 124,554 6,383
Torchmark Corp. 69,700 2,322
Transatlantic Holdings, Inc. 20,000 1,858
Unitrin, Inc. 37,800 1,174
UnumProvident Corp. 131,471 3,714
-+ XO Communications, Inc., Class A 126,816 4,278
-----------
296,565
MEDIA 3.7%
-----------------------------------------------------------------------------
A.H. Belo Corp., Class A 65,000 1,247
- American Tower Corp., Class A 92,600 3,791
BHC Communications, Inc., Class A 11,700 1,685
- Cablevision Systems Corp., Class A 73,200 5,453
- Chris-Craft Industries, Inc. 19,499 1,433
- Clear Channel Communications, Inc. 274,629 16,495
-+ CNET Networks, Inc. 67,964 2,141
- Comcast Corp., Special Class A 502,276 20,468
- Comcast Corp., Class A 17,000 682
- Cox Communications, Inc., Class A 317,786 14,002
-+ Crown Castle International Corp. 107,300 3,253
Dow Jones & Co., Inc. 50,450 2,970
-+ EchoStar Communications Corp., Class A 128,200 5,801
-+ Emmis Communications Corp., Class A 22,400 599
- Express Scripts, Inc., Class A 22,000 1,478
-+ Fox Entertainment Group, Inc., Class A 99,900 2,148
Gannett Co., Inc. 147,600 8,561
Harte-Hanks Communications, Inc. 38,200 845
- Hispanic Broadcasting Corp. 58,000 1,813
Hollinger International, Inc. 60,000 926
Houghton Mifflin Co. 20,000 736
Knight-Ridder, Inc. 48,400 2,432
Lee Enterprises, Inc. 22,000 608
-+ Liberty Digital, Inc., Class A 14,600 170
McClatchy Co., Class A 22,000 836
McGraw-Hill Cos., Inc. 111,350 7,147
Media General, Inc., Class A 19,500 741
Meredith Corp. 29,000 921
- Metro-Goldwyn-Mayer, Inc. 119,520 2,353
New York Times Co., Class A 94,026 3,455
-+ Price Communications Corp. 25,900 560
- Primedia, Inc. 92,300 1,044
R.R. Donnelley & Sons Co. 66,500 1,430
Reader's Digest Association, Inc., Class A 57,800 2,121
The E.W. Scripps Co., Class A 43,975 2,570
Time Warner, Inc. 735,310 55,817
Tribune Co. 174,900 6,482
+ United Television, Inc. 5,300 710
-+ UnitedGlobalCom, Inc., Class A 27,800 884
- USA Networks, Inc. 164,400 3,329
- Valassis Communications, Inc. 37,500 1,041
-+ Valuevision International, Inc., Class A 21,200 429
- Viacom, Inc., Class B 842,703 47,929
The Walt Disney Co. 1,157,221 41,443
Washington Post Co., Class B 5,200 2,777
-+ Westwood One, Inc. 60,600 1,148
-----------
284,904
MISCELLANEOUS 0.3%
-----------------------------------------------------------------------------
-+ C-Cube Microsystems, Inc. 22,600 441
-+ Palm, Inc. 313,261 16,779
-+ Spherion Corp. 35,500 422
XCEL Energy, Inc. 192,535 4,922
-----------
22,564
</TABLE>
See the Financial Notes, which 37
are integral to this information.
<PAGE> 42
SCHWAB 1000 FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
MISCELLANEOUS FINANCE 7.3%
-----------------------------------------------------------------------------
A.G. Edwards, Inc. 52,843 2,682
+ Allied Capital Corp. 37,600 776
American Express Co. 738,600 44,316
-+ AmeriCredit Corp. 41,000 1,102
-+ Ameritrade Holding Corp., Class A 89,500 1,309
Associates First Capital Corp., Class A 404,902 15,032
Astoria Financial Corp. 29,750 1,116
AXA Financial, Inc. 246,900 13,348
Bear Stearns Cos., Inc. 59,671 3,618
- Berkshire Hathaway, Inc., Class A 843 53,699
- Berkshire Hathaway, Inc., Class B 3,421 7,194
- BISYS Group, Inc. 34,000 1,602
Capital One Financial Corp. 108,250 6,833
## Charles Schwab Corp. 767,097 26,944
Charter One Financial, Inc. 121,144 2,779
CIT Group, Inc., Class A 145,300 2,534
(7)Citigroup, Inc. 2,500,498 131,589
Countrywide Credit Industries, Inc. 61,285 2,294
Dime Bancorp., Inc. 61,926 1,513
+ Eaton Vance Corp. 19,300 961
- E*Trade Group, Inc. 161,000 2,345
Fannie Mae 559,700 43,097
+ Federated Investors, Inc., Class B 67,650 1,970
Finova Group, Inc. 26,700 68
Franklin Resources, Inc. 133,200 5,706
Freddie Mac 386,200 23,172
Golden State Bancorp, Inc. 68,000 1,777
Household International, Inc. 261,598 13,162
John Nuveen Co., Class A 15,000 716
-+ Knight Trading Group, Inc. 68,100 2,039
Legg Mason, Inc. 32,000 1,662
Lehman Brothers Holdings, Inc. 135,760 8,757
MBNA Corp. 472,887 17,763
Merrill Lynch & Co., Inc. 445,400 31,178
Morgan Stanley Dean Witter & Co. 625,110 50,204
Paine Webber Group, Inc. 83,887 5,977
Sovereign Bancorp., Inc. 109,600 911
T. Rowe Price Associates, Inc. 65,900 3,085
TCF Financial Corp. 50,600 2,046
USA Education, Inc. 90,350 5,048
Washington Federal, Inc. 28,940 646
Washington Mutual, Inc. 302,648 13,317
Wesco Financial Corp. 3,800 1,017
-----------
556,904
NON-FERROUS METALS 0.2%
-----------------------------------------------------------------------------
Alcoa, Inc. 479,495 13,756
Engelhard Corp. 69,687 1,455
- Freeport-McMoRan Copper & Gold, Inc., Class B 78,894 626
-+ Mueller Industries, Inc. 19,900 464
Phelps Dodge Corp. 44,700 2,090
-----------
18,391
OIL: DOMESTIC 0.6%
-----------------------------------------------------------------------------
Amerada Hess Corp. 52,100 3,230
Ashland, Inc. 38,500 1,261
Diamond Offshore Drilling, Inc. 76,800 2,654
Kerr-McGee Corp. 52,102 3,403
Murphy Oil Corp. 27,670 1,603
-+ Ocean Energy, Inc. 100,200 1,390
Phillips Petroleum Co. 143,800 8,880
Sunoco, Inc. 51,900 1,554
Tosco Corp. 79,600 2,279
Transocean Sedco Forex, Inc. 116,800 6,190
Ultramar Diamond Shamrock Corp. 50,700 1,331
Unocal Corp. 135,534 4,625
USX-Marathon Group, Inc. 176,000 4,785
-----------
43,185
OIL: INTERNATIONAL 2.9%
---------------------------------------------------------------------------- -
Chevron Corp. 362,700 29,787
(4)Exxon Mobil Corp. 1,935,565 172,628
Santa Fe International Corp. 65,000 2,373
Texaco, Inc. 306,309 18,091
-----------
222,879
</TABLE>
38 See the Financial Notes, which
are integral to this information.
<PAGE> 43
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
OPTICAL & PHOTO 0.1%
-----------------------------------------------------------------------------
Eastman Kodak Co. 170,200 7,638
PAPER & FOREST PRODUCTS 0.7%
-----------------------------------------------------------------------------
Boise Cascade Corp. 33,000 947
Bowater, Inc. 31,300 1,694
Fort James Corp. 113,800 3,748
Georgia-Pacific Corp. (Timber Group) 50,000 1,416
Georgia-Pacific Group 93,500 2,513
International Paper Co. 265,845 9,737
Kimberly-Clark Corp. 306,260 20,213
Louisiana-Pacific Corp. 57,200 486
Mead Corp. 56,800 1,644
Pentair, Inc. 26,200 781
+ Potlatch Corp. 15,800 529
Rayonier, Inc. 13,875 488
Smurfit-Stone Container Corp. 120,100 1,621
Temple-Inland, Inc. 28,900 1,293
Westvaco Corp. 55,800 1,590
Weyerhaeuser Co. 122,000 5,726
Willamette Industries, Inc. 61,000 2,215
-----------
56,641
PRODUCER GOODS & MANUFACTURING 6.3%
-----------------------------------------------------------------------------
Actuant Corp., Class A 30,000 109
- American Standard Cos. 38,900 1,785
-+ Applied Micro Circuits Corp. 163,000 12,459
Avery Dennison Corp. 61,800 3,121
- Blyth, Inc. 30,000 780
Briggs & Stratton Corp. 16,300 582
Caterpillar, Inc. 190,700 6,686
-+ Cognex Corp. 22,700 760
Cooper Industries, Inc. 53,700 2,054
Corning, Inc. 489,641 37,458
Deere & Co. 128,400 4,727
Dover Corp. 114,200 4,846
Emerson Electric Co. 236,200 17,346
- FMC Corp. 16,900 1,284
#(1) General Electric Co. 5,505,300 301,759
Harsco Corp. 22,300 450
Herman Miller, Inc. 43,500 1,136
HON Industries, Inc. 38,800 934
+ Honeywell International, Inc. 445,263 23,961
Hubbell, Inc., Class B 33,538 803
Illinois Tool Works, Inc. 167,742 9,320
Ingersoll-Rand Co. 89,650 3,384
- Jabil Circuit, Inc. 104,400 5,957
Johnson Controls, Inc. 47,100 2,808
-+ Lattice Semiconductor Corp. 53,800 1,570
-+ Mastec, Inc. 25,200 729
-+ Micrel, Inc. 46,400 2,100
Millipore Corp. 24,900 1,307
Minnesota Mining & Manufacturing Co. 219,400 21,200
Pall Corp. 70,233 1,514
Parker-Hannifin Corp. 64,375 2,664
-+ Rare Medium Group, Inc. 17,400 80
-+ Safeguard Scientifics, Inc. 51,100 786
Snap-On, Inc. 17,150 438
Teleflex, Inc. 25,000 864
The Timken Co. 33,600 473
Trinity Industries, Inc. 21,950 528
U.S. Industries, Inc. 27,500 244
Valhi, Inc. 67,000 825
W.W. Grainger, Inc. 53,600 1,712
-+ Zebra Technologies Corp., Class A 17,700 775
-----------
482,318
RAILROAD & SHIPPING 0.3%
-----------------------------------------------------------------------------
Burlington Northern Santa Fe Corp. 223,753 5,943
CSX Corp. 120,300 3,045
Florida East Coast Industries, Inc., Class A 20,300 726
GATX Corp. 24,000 1,010
+ Kansas City Southern Industires, Inc. 30,800 268
Newport News Shipbuilding, Inc. 15,000 738
Norfolk Southern Corp. 213,000 3,009
Union Pacific Corp. 136,261 6,387
-----------
21,126
REAL PROPERTY 0.0%
-----------------------------------------------------------------------------
- Catellus Development Corp. 61,600 1,120
The St. Joe Co. 43,300 874
-----------
1,994
</TABLE>
See the Financial Notes, which 39
are integral to this information.
<PAGE> 44
SCHWAB 1000 FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
RETAIL 5.0%
-----------------------------------------------------------------------------
Albertson's, Inc. 232,042 5,497
- Amazon.com, Inc. 197,800 7,244
- American Eagle Outfitters, Inc. 26,000 895
-+ AnnTaylor Stores Corp. 17,400 522
- AutoZone, Inc. 74,000 1,984
- Barnes & Noble, Inc. 40,000 755
- Bed, Bath & Beyond, Inc. 159,200 4,109
- Best Buy Co., Inc. 113,600 5,701
- BJ's Wholesale Club, Inc. 40,600 1,337
- Borders Group, Inc. 43,000 597
Circuit City Stores-Circuit City Group 117,600 1,558
- Consolidated Stores Corp. 56,312 669
- Costco Wholesale Corp. 248,408 9,098
CVS Corp. 214,914 11,377
Dillards, Inc., Class A 43,100 453
Dollar General Corp. 182,669 2,831
- Dollar Tree Stores, Inc. 59,400 2,324
Family Dollar Stores, Inc. 96,200 1,870
- Federated Department Stores, Inc. 115,200 3,751
Gap, Inc. 468,000 12,080
Home Depot, Inc. 1,285,597 55,281
Intimate Brands, Inc. 273,000 6,518
J.C. Penney Co., Inc. 143,000 1,671
- Kmart Corp. 265,600 1,577
- Kohl's Corp. 182,600 9,895
- Kroger Co. 458,080 10,335
-+ Lands' End, Inc. 16,500 423
Limited, Inc. 239,938 6,058
Lowe's Cos., Inc. 212,200 9,695
May Department Stores Co. 163,350 4,288
Nordstrom, Inc. 68,800 1,131
- Office Depot, Inc. 146,848 1,221
- Payless Shoesource, Inc. 12,814 742
RadioShack Corp. 109,332 6,519
- Rite Aid Corp. 141,700 363
Ross Stores, Inc. 47,000 620
- Safeway, Inc. 274,780 15,027
- Saks, Inc. 68,340 696
Sears, Roebuck & Co. 189,600 5,637
- Staples, Inc. 252,460 3,598
Target Corp. 501,900 13,865
- The Neiman Marcus Group, Inc., Class A 30,000 1,114
Tiffany & Co., Inc. 80,000 3,415
TJX Cos., Inc. 169,900 4,630
- Toys 'R' Us, Inc. 120,880 2,078
(10) Wal-Mart Stores, Inc. 2,482,500 112,643
Walgreen Co. 561,200 25,605
Weis Markets, Inc. 23,900 878
- Williams-Sonoma, Inc. 28,000 583
Winn-Dixie Stores, Inc. 82,300 1,584
- Zale Corp. 19,600 664
-----------
383,006
STEEL 0.1%
-----------------------------------------------------------------------------
AK Steel Holding Corp. 56,700 524
Allegheny Technologies, Inc. 46,140 934
Nucor Corp. 45,100 1,564
USX-U.S. Steel Group, Inc. 49,260 785
+ Worthington Industries, Inc. 50,200 480
-----------
4,287
TELEPHONE 6.2%
-----------------------------------------------------------------------------
-+ Adtran, Inc. 22,300 847
-+ Allegiance Telecom, Inc. 55,050 1,731
Alltel Corp. 174,867 11,268
AT&T Corp. 2,059,911 47,764
BellSouth Corp. 1,041,700 50,327
- Broadwing, Inc. 118,752 3,355
-+ Carrier Access Corp. 13,400 168
-+ Centennial Communications Corp. 52,800 1,030
CenturyTel, Inc. 77,887 2,999
- Citizens Communications Co. 150,818 2,187
-+ Commonwealth Telephone Enterprises, Inc. 12,200 422
-+ Exodus Communications, Inc. 230,700 7,743
-+ Global Telesystems Group, Inc. 91,900 247
-+ Intermedia Communications, Inc. 32,700 724
+ ITC 35,800 290
- Level 3 Communications, Inc. 202,300 9,647
</TABLE>
40 See the Financial Notes, which
are integral to this information.
<PAGE> 45
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- McLeodUSA, Inc., Class A 303,800 5,848
- NTL, Inc. 149,713 6,578
-+ Powertel, Inc. 16,900 1,475
- Qwest Communications International, Inc. 920,747 44,771
-+ RCN Corp. 42,900 761
SBC Communications, Inc. 1,884,028 108,685
Sprint Corp. (FON Group) 472,668 12,053
- Sprint Corp. (PCS Group) 493,421 18,812
Telephone & Data Systems, Inc. 35,100 3,703
- U.S. Cellular Corp. 53,800 3,443
+ Verizon Communications 1,508,793 87,227
-+ Viatel, Inc. 18,500 178
- Winstar Communications, Inc. 30,000 585
- Worldcom, Inc. 1,594,728 37,875
-----------
472,743
TOBACCO 0.6%
-----------------------------------------------------------------------------
Philip Morris Cos., Inc. 1,244,700 45,587
UST, Inc. 90,000 2,273
-----------
47,860
TRAVEL & RECREATION 0.2%
-----------------------------------------------------------------------------
Brunswick Corp. 48,900 951
- Harrah's Entertainment, Inc. 67,600 1,935
Hertz Corp., Class A 23,000 756
Hilton Hotels Corp. 203,667 1,935
-+ Mandalay Resort Group 51,400 1,070
Marriott International, Inc., Class A 138,600 5,613
MGM Mirage, Inc. 87,800 3,035
+ Royal Caribbean Cruises Ltd. 99,300 2,234
- Speedway Motorsports, Inc. 23,700 413
-----------
17,942
TRUCKING & FREIGHT 0.1%
-----------------------------------------------------------------------------
+ C.H. Robinson Worldwide, Inc. 27,500 1,504
CNF Transportation, Inc. 26,400 705
+ Expeditores International of Washington, Inc. 28,400 1,473
PACCAR, Inc. 42,120 1,772
Ryder Systems, Inc. 33,800 668
-----------
6,122
UTILITIES: ELECTRIC & GAS 3.4%
-----------------------------------------------------------------------------
- AES Corp. 251,736 14,223
Allegheny Energy, Inc. 62,100 2,542
Allete 44,000 949
Alliant Energy Corp. 45,000 1,364
Ameren Corp. 77,130 3,066
American Electric Power Co., Inc. 176,920 7,342
American Water Works Co., Inc. 54,600 1,331
CP&L Energy, Inc. 90,500 3,648
-+ Calpine Corp. 75,700 5,976
Cinergy Corp. 87,565 2,682
CMS Energy Corp. 62,900 1,698
Coastal Corp. 117,700 8,879
Columbia Energy Group 44,100 3,172
Conectiv, Inc. 51,700 927
Consolidated Edison, Inc. 116,100 4,085
Constellation Energy Group, Inc. 83,050 3,462
Dominion Resources, Inc. 132,242 7,877
DPL, Inc. 70,492 2,000
DQE, Inc. 44,050 1,539
DTE Energy Co. 78,100 2,821
Duke Energy Corp. 203,331 17,575
Dynegy, Inc., Class A 171,614 7,948
Edison International 183,600 4,383
El Paso Energy Corp. 129,768 8,135
Energy East Corp. 66,800 1,349
Enron Corp. 410,238 33,665
Entergy Corp. 135,421 5,188
+ Equitable Resources, Inc. 18,000 1,044
FirstEnergy Corp. 129,515 3,351
Florida Progress Corp. 54,000 2,872
FPL Group, Inc. 98,100 6,475
GPU, Inc. 67,600 2,235
Ipalco Enterprises, Inc. 49,000 1,099
Kansas City Power & Light Co. 35,900 864
KeySpan Corp. 77,934 2,742
Kinder Morgan, Inc. 65,800 2,537
LG&E Energy Corp. 70,155 1,723
MCN Energy Group, Inc. 50,600 1,246
</TABLE>
See the Financial Notes, which 41
are integral to this information.
<PAGE> 46
SCHWAB 1000 FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
MDU Resources Group, Inc. 34,700 1,015
Montana Power Co. 65,800 1,859
National Fuel Gas Co. 26,600 1,426
- Niagara Mohawk Holdings, Inc. 89,200 1,427
NICOR, Inc. 25,300 893
NiSource, Inc. 67,400 1,681
Northeast Utilities 81,900 1,669
OGE Energy Corp. 51,200 1,053
Peoples Energy Corp. 19,500 670
PG&E Corp. 213,658 5,755
Pinnacle West Capital Corp. 47,300 2,055
Potomac Electric Power Co. 69,400 1,588
PPL Corp. 84,720 3,489
Public Service Enterprise Group, Inc. 122,300 5,075
Puget Sound Energy, Inc. 48,200 1,184
Questar Corp. 44,300 1,199
Reliant Energy, Inc. 169,117 6,987
-+ Republic Services, Inc. 99,300 1,334
Scana Corp. 65,800 1,744
Sempra Energy 114,338 2,365
Sierra Pacific Resources 46,600 801
Southern Co. 358,700 10,537
Teco Energy, Inc. 72,200 2,013
TXU Corp. 146,412 5,426
UtiliCorp United, Inc. 48,350 1,284
Washington Gas Light Co. 30,000 765
Western Resources, Inc. 38,231 817
Williams Cos., Inc. 246,061 10,288
Wisconsin Energy Corp. 67,800 1,276
-----------
261,689
</TABLE>
<TABLE>
<S> <C>
OTHER INVESTMENT COMPANIES
0.0% of investments
Provident Institutional
TempFund 3,283,978 3,284
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM INVESTMENTS
0.1% of investments
SECURITY FACE VALUE MKT. VALUE
RATE, MATURITY DATE ($ x 1,000) ($ x 1,000)
<S> <C> <C>
PNC Financial Services
Group Repurchase Agreement 5.50%,
dated 10/31/00, matures 11/1/00,
repurchase price $7,543,152
(collateralized by: Federal Home
Loan Mortgage Corp., total market
value $7,768,679) 7,542 7,542
</TABLE>
<TABLE>
<S> <C> <C>
U.S. TREASURY OBLIGATIONS
0.0% of investments
# U.S. Treasury Bills
5.92%-6.02%, 12/14/00 315 313
</TABLE>
--------------------------------------------------------------------------------
END OF PORTFOLIO HOLDINGS. For totals, please see the first page of holdings for
this fund.
42 See the Financial Notes, which
are integral to this information.
<PAGE> 47
Statement of
ASSETS AND LIABILITIES
As of October 31, 2000. All numbers x 1,000 except NAV.
<TABLE>
<CAPTION>
ASSETS
--------------------------------------------------------------------------------
<S> <C>
Investments, at market value $ 7,598,647 a
Cash 1
Collateral held for securities on loan 306,765 b
Receivables:
Fund shares sold 6,806
Interest 22
Dividends 5,074
Investments sold 9,526
Income from lending securities 31
Most recent daily change in value of futures 73
Prepaid expenses + 90
------------
TOTAL ASSETS 7,927,035
LIABILITIES
--------------------------------------------------------------------------------
Collateral held for securities on loan 306,765 b
Payables:
Fund shares redeemed 3,681
Interest expense 1
Investments bought 13,999
Investment adviser and administrator fees 217
Transfer agent and shareholder service fees 173
Accrued expenses + 429
------------
TOTAL LIABILITIES 325,265
NET ASSETS
--------------------------------------------------------------------------------
TOTAL ASSETS 7,927,035
TOTAL LIABILITIES - 325,265
------------
NET ASSETS $ 7,601,770
NET ASSETS BY SOURCE
Capital received from investors 4,174,918
Net investment income not yet distributed 39,491
Net realized capital losses (23,445)
Net unrealized capital gains 3,410,806 c
</TABLE>
a The fund paid $4,187,799 for these securities. Not counting short-term
obligations and government securities, the fund paid $712,871 for securities
during the report period and received $792,092 from securities it sold or that
matured. This includes $91,026 in transactions with other SchwabFunds(R).
b Market value of securities loaned: $299,231.
c These derive from investments and futures. As of the report date, the fund had
ten open S&P 500 futures contracts due to expire on December 15, 2000, with a
contract value of $3,600 and unrealized losses of $42.
NET ASSET VALUE (NAV)
<TABLE>
<CAPTION>
SHARES
SHARE CLASS NET ASSETS / OUTSTANDING = NAV
<S> <C> <C> <C>
Investor Shares $5,083,063 127,246 $39.95
Select Shares(R) $2,518,707 63,004 $39.98
</TABLE>
<TABLE>
<CAPTION>
FEDERAL TAX DATA
--------------------------------------------------------------------------------
<S> <C>
COST BASIS OF PORTFOLIO $4,194,918
NET UNREALIZED GAINS AND LOSSES:
Gains $3,769,543
Losses + (365,856)
-----------
$3,403,687
UNUSED CAPITAL LOSSES:
Expires 10/31 of: Loss amount
2003 $ 415
2004 844
2005 2,606
2006 650
2007 11,853
</TABLE>
See the Financial Notes, which 43
are integral to this information.
<PAGE> 48
SCHWAB 1000 FUND(R) -- FINANCIALS
Statement of
OPERATIONS
For November 1, 1999 through October 31, 2000. All numbers x 1,000.
<TABLE>
<CAPTION>
INVESTMENT INCOME
--------------------------------------------------------------------------------
<S> <C>
Dividends $81,487 a
Interest 418
Lending of securities + 1,033
------------
TOTAL INVESTMENT INCOME 82,938
NET REALIZED GAINS AND LOSSES
--------------------------------------------------------------------------------
Net realized losses on investments sold (3,480)
Net realized gains on futures contracts + 353
------------
NET REALIZED LOSSES (3,127)
NET UNREALIZED GAINS AND LOSSES
--------------------------------------------------------------------------------
Net unrealized gains on investments 542,852
Net unrealized losses on futures contracts + (717)
------------
NET UNREALIZED GAINS 542,135
EXPENSES
--------------------------------------------------------------------------------
Investment adviser and administrator fees 16,968 b
Transfer agent and shareholder
service fees:
Investor Shares 12,755 c
Select Shares(R) 2,429 c
Trustees' fees 35 d
Custodian fees 223
Portfolio accounting fees 1,062
Professional fees 82
Registration fees 187
Shareholder reports 581
Interest expense 109
Proxy fees 603
Other expenses + 138
------------
Total expenses 35,172
Expense reduction - 2,491 e
------------
NET EXPENSES 32,681
INCREASE IN NET ASSETS FROM OPERATIONS
--------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 82,938
NET EXPENSES - 32,681
------------
NET INVESTMENT INCOME 50,257
NET REALIZED LOSSES (3,127) f
NET UNREALIZED GAINS + 542,135 f
------------
INCREASE IN NET ASSETS FROM OPERATIONS $589,265
</TABLE>
a An additional $8 was withheld for foreign taxes.
b Calculated as a percentage of average daily net assets: 0.30% of the first
$500 million, and 0.22% of average daily assets over 500 million.
c Calculated as a percentage of average daily net assets: for transfer agent
services, 0.05% of the fund's assets; for shareholder services, 0.20%, and
0.05% of the assets of each respective share class.
d For the fund's independent trustees only.
e Includes $451 from the investment adviser (CSIM) and $2,040 from the transfer
agent and shareholder service agent (Schwab). These reductions reflect a
guarantee by CSIM and Schwab to limit the operating expenses of this fund
through at least February 28, 2001, as follows:
<TABLE>
<CAPTION>
% OF AVERAGE
SHARE CLASS DAILY NET ASSETS
--------------------------------------------------------------------------------
<S> <C>
Investor Shares 0.46
Select Shares 0.35
</TABLE>
This limit does not include interest, taxes and certain non-routine
expenses.
f These add up to a net gain on investments of $539,008.
44 See the Financial Notes, which
are integral to this information.
<PAGE> 49
Statements of
CHANGES IN NET ASSETS
For the current and prior report periods. All numbers x 1,000.
<TABLE>
<CAPTION>
OPERATIONS
--------------------------------------------------------------------------------
11/1/99 - 10/31/00 11/1/98 - 10/31/99
<S> <C> <C>
Net investment income $ 50,257 $ 51,388
Net realized losses (3,127) (13,695)
Net unrealized gains + 542,135 1,244,248
--------------------------------
INCREASE IN NET ASSETS FROM OPERATIONS 589,265 1,281,941
DISTRIBUTIONS PAID
-------------------------------------------------------------------------------
DIVIDENDS FROM NET INVESTMENT INCOME
Investor Shares 33,936 31,297
Select Shares(R) + 19,080 11,925
--------------------------------
TOTAL DIVIDENDS FROM NET INVESTMENT INCOME $ 53,016 $ 43,222 a
</TABLE>
TRANSACTIONS IN FUND SHARES
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>
11/1/99 - 10/31/00 11/1/98 - 10/31/99
QUANTITY VALUE QUANTITY VALUE
<S> <C> <C> <C> <C>
Shares sold:
Investor Shares 25,657 $1,015,329 43,791 $1,518,286
Select Shares + 18,493 732,803 34,607 1,194,734
----------------------------------------------
TOTAL SHARES SOLD 44,150 $1,748,132 78,398 $2,713,020
Shares reinvested:
Investor Shares 803 $ 31,141 913 $ 29,333
Select Shares + 431 16,725 328 10,536
----------------------------------------------
TOTAL SHARES REINVESTED 1,234 $ 47,866 1,241 $ 39,869
Shares redeemed:
Investor Shares 31,869 $1,258,205 34,357 $1,194,295
Select Shares + 15,483 610,463 10,134 356,795
----------------------------------------------
TOTAL SHARES REDEEMED 47,352 $1,868,668 44,491 $1,551,090 b
NET INCREASE OR DECREASE (1,968) ($72,670) 35,148 $1,201,799 c
</TABLE>
SHARES OUTSTANDING AND NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
11/1/99 - 10/31/00 11/1/98 - 10/31/99
SHARES NET ASSETS SHARES NET ASSETS
<S> <C> <C> <C> <C>
Beginning of period 192,218 $7,138,191 157,070 $4,697,673
Total increase or
decrease + (1,968) 463,579 35,148 2,440,518 d
-----------------------------------------------
END OF PERIOD 190,250 $7,601,770 192,218 $7,138,191 e
</TABLE>
a UNAUDITED
For corporations, 100% of the fund's dividends for the report period
qualify for the dividends-received deduction.
b Dollar amounts are net of proceeds received from early withdrawal fees that
the fund charges on shares sold 180 days or less after buying them:
<TABLE>
<CAPTION>
CURRENT PERIOD
<S> <C>
Investor Shares $ 576
Select Shares + 351
-----------
Total $ 927
</TABLE>
<TABLE>
<CAPTION>
PRIOR PERIOD
<S> <C>
Investor Shares $662
Select Shares + 370
-----------
Total $ 1,032
</TABLE>
c Represents shares sold plus shares reinvested, minus shares redeemed.
d Figures for shares represent the net changes in shares from the transactions
described above. Figures for net assets represent the changes in net assets
from operations plus the value of transactions in fund shares, minus
distributions paid.
e Includes net investment income not yet distributed in the amount of $39,491
for the current period and $42,250 for the prior period.
See the Financial Notes, which 45
are integral to this information.
<PAGE> 50
SCHWAB
SMALL-CAP INDEX FUND(R)
[PHOTO OF GERI HOM]
"The fund's strong performance was attributable to the solid gains in the
healthcare, energy, capital goods and technology sectors."
Portfolio Manager
Geri Hom
GERI HOM, a vice president of the investment adviser, has overall
responsibility for the management of the fund. Prior to joining the firm in
1995, she worked for nearly 15 years in equity index management.
TICKER SYMBOLS
Investor Shares SWSMX
Select Shares(R) SWSSX
[INVESTMENT STYLE 1 AND MARKET CAP 1 GRAPHIC]
<TABLE>
<S> <C> <C>
VALUE BLEND GROWTH
LARGE
MEDIUM
X SMALL
</TABLE>
With its small-cap focus, this fund may make sense for long-term investors who
are willing to accept greater risk in the pursuit of potentially higher
long-term returns.
THE FUND'S GOAL IS TO TRACK THE TOTAL RETURN OF THE SCHWAB SMALL-CAP
INDEX.(R)
MANAGER'S PERSPECTIVE
GIVEN THE VOLATILITY THAT PREVAILED IN EQUITY MARKETS, THE FUND PERFORMED
COMPARATIVELY WELL DURING THE REPORT PERIOD. A combination of factors caused
investors to trim their overall exposure to stocks. Among these factors were
high stock prices, uncertainty over the outcome of the presidential election and
potential interest rate hikes. Toward the end of the report period, evidence of
a slowing economy reduced fears of interest rate hikes. Ordinarily this might
have helped the market regain its footing, but concerns about high oil prices
kept stocks in flux.
SMALL-CAP STOCKS UNSEATED LARGE-CAP STOCKS AS THE TOP-PERFORMING ASSET CLASS,
ENDING A FIVE-YEAR RUN FOR LARGE-CAPS. For the report period, the Russell
2000(R) Index--a popular measure of the small-cap market--outperformed the
S&P 500(R) Index as well as the Nasdaq Composite Index. The fund's benchmark,
the Schwab Small-Cap Index, in turn outperformed all of these indices for the
period.
Initially, the fund's growth stocks outperformed their value counterparts. This
trend reversed in the second half of the period as investors reduced their
exposure to technology issues. Both share classes of the Schwab Small-Cap Index
Fund tracked the fund's benchmark.
1 Source: Morningstar, Inc. This style assessment is the result of comparing the
fund with the S&P 500 Index, based on P/E, P/B and median market cap. The
assessment reflects the fund's portfolio as of 10/31/00, which may have changed
since then, and is not a precise indication of risk or performance--past,
present or future.
46
<PAGE> 51
PERFORMANCE: INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Investor Shares with the Schwab
Small-Cap Index(R) and the Morningstar Small-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR 5 YEARS SINCE INCEPTION: 12/3/93
------------------------- ------------------------ ------------------------
(0.62%) (1.86%) (1.50%)
--------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Total Return 2 21.22% 21.84% 25.32% 1 14.15% 16.01% 14.56% 12.69% 14.19% n/a
% of Return Lost to Taxes 0.47% -- 7.78% 1 2.97% -- 17.24% n/a -- n/a
AFTER-TAX RETURN 2 21.12% -- 23.35% 1 13.73% -- 12.05% n/a -- n/a
</TABLE>
PERFORMANCE OF A $10,000 INVESTMENT
Shows performance since inception of a hypothetical $10,000 investment in the
fund's Investor Shares, compared to a similar investment in two indices: the
Schwab Small-Cap Index and the Russell 2000(R) Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
INVESTOR
SHARES SCHWAB RUSSELL 2000
SMALL-CAP INDEX
INDEX
<S> <C> <C> <C>
12/3/93 10000 10000 10000
12/31/93 10154 10234 10186
1/31/94 10394 10469 10505
2/28/94 10334 10430 10467
3/31/94 9783 9871 9915
4/30/94 9753 9847 9974
5/31/94 9613 9692 9861
6/30/94 9333 9419 9529
7/31/94 9493 9614 9685
8/31/94 10134 10249 10225
9/30/94 10094 10191 10190
10/31/94 10064 10149 10149
11/30/94 9663 9767 9739
12/31/94 9841 10000 10000
1/31/95 9730 9838 9874
2/28/95 10082 10229 10285
3/31/95 10334 10442 10461
4/30/95 10566 10671 10693
5/31/95 10717 10809 10877
6/30/95 11211 11356 11441
7/31/95 11866 12021 12100
8/31/95 12077 12270 12351
9/30/95 12309 12510 12572
10/31/95 11785 11910 12010
11/30/95 12329 12482 12514
12/31/95 12562 12782 12845
1/31/96 12491 12749 12831
2/29/96 12967 13261 13231
3/31/96 13170 13492 13505
4/30/96 13899 14206 14227
5/31/96 14384 14692 14788
6/30/96 13848 14222 14180
7/31/96 12643 13075 12942
8/31/96 13413 13904 13694
9/30/96 14010 14416 14230
10/31/96 13757 14169 14010
11/30/96 14344 14733 14588
12/31/96 14508 15007 14970
1/31/97 14895 15361 15269
2/28/97 14376 14986 14900
3/31/97 13654 14257 14196
4/30/97 13756 14299 14236
5/31/97 15383 16050 15821
6/30/97 16125 16880 16499
7/31/97 17213 17842 17267
8/31/97 17538 18243 17662
9/30/97 18850 19675 18955
10/31/97 18026 18816 18123
11/30/97 17843 18645 18005
12/31/97 18236 19035 18320
1/31/98 17787 18736 18031
2/28/98 19195 20285 19361
3/31/98 20042 21199 20159
4/30/98 20144 21344 20270
5/31/98 18930 20090 19177
6/30/98 18960 20146 19218
7/31/98 17471 18597 17661
8/31/98 14062 15011 14231
9/30/98 14991 15953 15345
10/31/98 15705 16709 15972
11/30/98 16532 17576 16809
12/31/98 17584 18719 17849
1/31/99 17617 18800 18086
2/28/99 16145 17229 16621
3/31/99 16372 17559 16881
4/30/99 17660 19165 18393
5/31/99 17974 19500 18662
6/30/99 18969 20778 19505
7/31/99 18872 20615 18971
8/31/99 18309 20033 18269
9/30/99 18493 20204 18272
10/31/99 18839 20537 18347
11/30/99 20008 21820 19443
12/31/99 21839 23899 21644
1/31/00 21015 23005 21295
2/29/00 23801 26015 24811
3/31/00 23075 25333 23176
4/30/00 21936 24109 21781
5/31/00 20904 22940 20511
6/30/00 22674 24856 22300
7/31/00 21774 23890 21581
8/31/00 23964 26291 23228
9/30/00 23238 25490 22545
10/31/00 22836 25023 21540
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the
distribution was made--currently 39.6% on dividends and short-term
capital gains and 20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of
any shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 892 funds in the
Small-Cap Fund category that had track records of at least one year and 333
funds with track records of at least five years. These funds may or may not
use tax- efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc
47
<PAGE> 52
SCHWAB SMALL-CAP INDEX FUND(R)
PERFORMANCE: SELECT SHARES(R)
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Select Shares with the Schwab
Small-Cap Index(R) and the Morningstar Small-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 5/19/97
------------------------ ------------------------
(0.47%) (1.51%)
--------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 21.37% 21.84% 25.32% 1 13.67% 15.18% n/a
% of Return Lost to Taxes 0.80% -- 7.78% 1 n/a -- n/a
AFTER-TAX RETURN 2 21.20% -- 23.35% 1 n/a -- n/a
</TABLE>
PERFORMANCE OF A $50,000 INVESTMENT
Shows performance since inception of a hypothetical $50,000 investment in the
fund's Select Shares, compared to a similar investment in two indices: the
Schwab Small-Cap Index and the Russell 2000(R) Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
SCHWAB RUSSELL
SELECT SMALL-CAP 2000
SHARES INDEX INDEX
<S> <C> <C> <C>
5/19/97 50000 50000 50000
5/31/97 52170 52242 51960
6/30/97 54690 54942 54189
7/31/97 58415 58075 56709
8/31/97 59485 59380 58008
9/30/97 63965 64039 62254
10/31/97 61205 61244 59521
11/30/97 60550 60687 59134
12/31/97 61920 61958 60169
1/31/98 60400 60983 59218
2/28/98 65175 66026 63588
3/31/98 68050 69002 66208
4/30/98 68430 69473 66572
5/31/98 64310 65391 62984
6/30/98 64415 65575 63116
7/31/98 59360 60531 58004
8/31/98 47790 48861 46740
9/30/98 50945 51924 50399
10/31/98 53365 54386 52456
11/30/98 56170 57207 55204
12/31/98 59775 60929 58621
1/31/99 59925 61193 59401
2/28/99 54925 56079 54590
3/31/99 55660 57152 55441
4/30/99 60070 62380 60409
5/31/99 61140 63470 61291
6/30/99 64555 67629 64061
7/31/99 64225 67099 62306
8/31/99 62315 65206 60000
9/30/99 62940 65762 60012
10/31/99 64115 66846 60258
11/30/99 68125 71021 63856
12/31/99 74390 77788 71084
1/31/00 71585 74879 69940
2/29/00 81065 84677 81487
3/31/00 78595 82458 76117
4/30/00 74755 78471 71535
5/31/00 71250 74666 67364
6/30/00 77265 80904 73238
7/31/00 74205 77761 70880
8/31/00 81655 85575 76288
9/30/00 79185 82968 74045
10/31/00 77820 81448 70743
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 892 funds in the
Small-Cap Fund category that had track records of at least one year and 333
funds with track records of at least five years. These funds may or may not
use tax- efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
48
<PAGE> 53
FUND FACTS
TOP TEN HOLDINGS 1 as of 10/31/00
<TABLE>
<S> <C>
1 ABGENIX, INC. 1.0%
2 PROTEIN DESIGN LABS, INC. 0.9%
3 VERTEX PHARMACEUTICALS, INC. 0.8%
4 POWER-ONE, INC. 0.8%
5 QUEST DIAGNOSTIC, INC. 0.7%
6 MEDAREX, INC. 0.7%
7 SABRE GROUP CORP. 0.7%
8 CELGENE CORP. 0.6%
9 IMCLONE SYSTEMS 0.5%
10 MANUGISTICS, INC. 0.5%
--------------------------------------------------------------------------------
TOTAL PERCENTAGE OF INVESTMENTS 7.2%
</TABLE>
STATISTICS as of 10/31/00
<TABLE>
<CAPTION>
PEER GROUP
FUND AVERAGE 2
--------------------------------------------------------------------------------
<S> <C> <C>
Number of Holdings 911 181
--------------------------------------------------------------------------------
Median Market Cap ($ Mil) $ 850 $ 1,256
--------------------------------------------------------------------------------
Price/Earnings (P/E) Ratio 24.3 27.7
--------------------------------------------------------------------------------
Price/Book (P/B) Ratio 4.9 5.5
--------------------------------------------------------------------------------
12-Month Yield Investor Shares 0.19% 0.22%
--------------------------------------------------------------------------------
Portfolio Turnover Rate 54% 105%
--------------------------------------------------------------------------------
Three-Year Beta 0.89 0.91
--------------------------------------------------------------------------------
</TABLE>
EXPENSE RATIO as of 10/31/00
[BAR CHART]
<TABLE>
<S> <C>
INVESTOR SHARES 0.49% 3
SELECT SHARES(R) 0.38% 3
PEER GROUP AVERAGE 1.55% 2
</TABLE>
INDEX COMPOSITION BY INDUSTRY 4
These charts show the size of the ten largest industries in the Schwab Small-Cap
Index.(R) As the charts show, the total portion represented by these industries
has been growing over the past five years.
[PIE CHART]
AS OF 10/31/00
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
1 16.8% Drugs & Medicine
2 12.0% Business Services
3 10.2% Electronics
4 6.1% Producer Goods
5 5.4% Miscellaneous Finance
6 4.3% Banks
7 3.9% Energy & Utilities
8 3.6% Insurance
9 3.5% Construction
10 3.1% Chemicals
31.1% Other
</TABLE>
[PIE CHART]
AS OF 10/31/99
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
1 15.3% Business Services
2 13.4% Electronics
3 7.6% Producer Goods
4 6.8% Drugs & Medicine
5 5.8% Miscellaneous Finance
6 5.8% Banks
7 4.3% Energy & Utilities
8 3.5% Insurance
9 3.2% Media
10 2.9% Telephone
31.3% Other
</TABLE>
[PIE CHART]
AS OF 10/31/95
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
1 10.6% Business Services
2 10.3% Drugs & Medicine
3 7.5% Banks
4 7.0% Electronics
5 6.4% Producer Goods
6 6.0% Miscellaneous Finance
7 5.0% Insurance
8 4.2% Energy & Utilities
9 4.0% Business Machines
10 3.9% Retail
35.1% Other
</TABLE>
1 This list is not a recommendation of any security by the investment adviser.
Portfolio holdings may have changed since the report date.
2 Source: Morningstar, Inc. As of 10/31/00, there were 892 funds in Small-Cap
Fund category.
3 Guaranteed by Schwab and the investment adviser through 2/28/01. The actual
expense ratio during the report period was 0.01% higher due to certain
non-routine expenses.
4 Source: Charles Schwab & Co., Inc.
49
<PAGE> 54
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
FINANCIAL TABLES
These pages provide additional data on the fund's performance, portfolio
holdings, expenses and business operations. These figures have been audited by
PricewaterhouseCoopers LLP.
Two other sections of this report provide context for the data in these
financials. THE FINANCIAL NOTES section contains information about the fund's
business structure, accounting practices and other matters, completing the data
given in these tables. The final section, HOW TO READ THIS REPORT, includes
guides designed to make the financials easy to read and understand.
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
11/1/99- 11/1/98- 11/1/97- 11/1/96- 11/1/95 -
INVESTOR SHARES 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96
PER-SHARE DATA ($)
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value at beginning of period 17.41 15.39 17.73 13.59 11.70
--------------------------------------------------------
Income from investment operations:
Net investment income 0.07 0.06 0.05 0.06 0.07
Net realized and unrealized gains or losses 3.62 2.89 (2.33) 4.14 1.88
--------------------------------------------------------
Total income or loss from investment
operations 3.69 2.95 (2.28) 4.20 1.95
Less distributions:
Dividends from net investment income (0.04) (0.06) (0.06) (0.06) (0.06)
Distributions from net realized gains -- (0.87) -- -- --
--------------------------------------------------------
Total distributions (0.04) (0.93) (0.06) (0.06) (0.06)
--------------------------------------------------------
Net asset value at end of period 21.06 17.41 15.39 17.73 13.59
========================================================
Total return (%) 21.22 19.96 (12.88) 31.03 16.73
RATIOS/SUPPLEMENTAL DATA (%)
-------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses to
average net assets 0.49 1 0.49 0.49 0.52 0.59
Expense reductions reflected in above ratio 0.16 0.30 0.32 0.37 0.35
Ratio of net investment income to
average net assets 0.44 0.33 0.35 0.53 0.56
Portfolio turnover rate 54 41 4023 23
Net assets, end of period ($ x 1,000,000) 803 452 480 410 209
</TABLE>
1 Would have been 0.50% if certain non-routine expenses (proxy fees) had been
included.
50 See the Financial Notes, which
are integral to this information.
<PAGE> 55
<TABLE>
<CAPTION>
11/1/99- 11/1/98- 11/1/97- 5/19/97 1-
SELECT SHARES(R) 10/31/00 10/31/99 10/31/98 10/31/97
----------------------------------------------------------------------------------------------------------------
PER-SHARE DATA ($)
------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value at beginning of period 17.44 15.41 17.75 14.50
-----------------------------------------------------
Income from investment operations:
Net investment income 0.11 0.07 0.08 0.02
Net realized and unrealized gains or losses 3.61 2.90 (2.35) 3.23
-----------------------------------------------------
Total income or loss from investment
operations 3.72 2.97 (2.27) 3.25
Less distributions:
Dividends from net investment income (0.07) (0.07) (0.07) --
Distributions from net realized gains -- (0.87) -- --
-----------------------------------------------------
Total distributions (0.07) (0.94) (0.07) --
-----------------------------------------------------
Net asset value at end of period 21.09 17.44 15.41 17.75
=====================================================
Total return (%) 21.37 20.14 (12.81) 22.41 2
RATIOS/SUPPLEMENTAL DATA (%)
--------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses
to average net assets 0.38 4 0.38 0.38 0.38 3
Expense reductions reflected in above ratio 0.12 0.27 0.33 0.52 3
Ratio of net investment income to
average net assets 0.55 0.44 0.46 0.56 3
Portfolio turnover rate 54 41 40 23
Net assets, end of period ($ x 1,000,000) 757 447 150 81
</TABLE>
1 Commencement of operations.
2 Not annualized.
3 Annualized.
4 Would have been 0.39% if certain non-routine expenses (proxy fees) had been
included.
See the Financial Notes, which 51
are integral to this information.
<PAGE> 56
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS
As of October 31, 2000
This section shows all the securities in the fund's portfolio and their market
value, as of the report date.
We use the symbols below to designate certain characteristics. With the top ten
holdings, the number in the circle is the security's rank among the top ten.
(1) Top ten holding
+ New holding (since 10/31/99)
- Non-income producing security
# Collateral for open futures contracts
The pie chart below shows the fund's major asset categories and the market value
and cost of the securities in each category.
ALL DOLLAR VALUES ARE IN THOUSANDS.
[PIE CHART]
<TABLE>
<S> <C>
99.5% COMMON STOCK
Market Value: $1,556,540
Cost: $1,445,973
0.5% SHORT TERM INVESTMENTS
Market Value: $8,318
Cost: $8,318
0.0% U.S. TREASURY OBLIGATIONS
Market Value: $253
Cost: $253
-----------------------------------------------------------------------
100.0% TOTAL INVESTMENTS
Market Value: $1,565,111
Cost: $1,454,544
</TABLE>
COMMON STOCK 99.5% of investments
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
AEROSPACE / DEFENSE 0.4%
--------------------------------------------------------------------------------
GenCorp., Inc. 99,400 832
- Sequa Corp., Class A 24,500 903
- + Trimble Navigation Ltd. 58,200 1,382
- Veeco Instruments, Inc. 56,470 3,738
---------
6,855
AIR TRANSPORTATION 1.1%
--------------------------------------------------------------------------------
AAR Corp. 62,800 750
+ Airborne Freight Corp. 115,900 1,173
- + Alaska Air Group, Inc. 62,400 1,618
- America West Holdings Corp., Class B 78,700 782
- Atlantic Coast Airlines Holdings, Inc. 49,800 1,780
- Atlas Air, Inc. 90,150 3,268
- EGL, Inc. 109,200 3,112
- Midwest Express Holdings, Inc. 33,000 627
SkyWest, Inc. 65,600 3,313
---------
16,423
ALCOHOLIC BEVERAGES 0.2%
--------------------------------------------------------------------------------
- Constellation Brands, Inc., Class A 44,200 2,155
- + The Robert Mondavi Corp., Class A 19,300 873
---------
3,028
APPAREL 2.0%
--------------------------------------------------------------------------------
- The Buckle, Inc. 48,550 816
- + Chico's FAS, Inc. 41,100 1,331
- Footstar, Inc. 46,300 1,661
- + Genesco, Inc. 50,800 902
- + Global Sports, Inc. 50,500 434
Kellwood Co. 56,900 1,106
- + Kenneth Cole Productions, Inc., Class A 48,250 2,192
- The Men's Wearhouse, Inc. 97,950 2,865
- Nautica Enterprises, Inc. 73,900 933
- Pacific Sunwear of California 74,725 1,532
- + Polo Ralph Lauren Corp. 73,100 1,435
- Quiksilver, Inc. 52,750 1,009
- Reebok International Ltd. 134,100 2,892
Russell Corp. 76,500 1,224
Springs Industries, Inc., Class A 42,400 999
- The Children's Place Retail Stores, Inc. 61,500 1,595
- The Dress Barn, Inc. 42,300 1,060
- Timberland Co., Class A 95,100 4,910
- + Unifi, Inc. 133,400 1,159
- + Urban Outfitters, Inc. 40,200 354
+ Warnaco Group, Inc., Class A 99,900 262
Wolverine World Wide, Inc. 97,600 1,055
---------
31,726
AUTOMOTIVE PRODUCTS / MOTOR VEHICLES 1.8%
--------------------------------------------------------------------------------
A.O. Smith Corp., Class B 55,300 781
Bandag, Inc. 49,400 1,763
+ Borg Warner, Inc. 62,117 2,345
+ Carlisle Cos., Inc. 71,400 2,972
+ Cooper Tire & Rubber Co. 170,500 1,865
</TABLE>
52 See the Financial Notes, which
are integral to this information.
<PAGE> 57
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Copart, Inc. 127,900 1,926
- + CSK Auto Corp. 47,500 166
Donaldson Co., Inc. 107,600 2,434
+ Fleetwood Enterprises, Inc. 77,200 1,018
- Group 1 Automotive, Inc. 50,200 499
- Hayes Lemmerz International, Inc. 71,600 783
Midas, Inc. 37,200 516
Modine Manufacturing Co. 70,000 1,846
- + Monaco Coach Corp. 44,900 766
Myers Industries, Inc. 51,387 681
+ Oshkosh Truck Corp. 39,500 1,624
Polaris Industries, Inc. 56,200 1,953
- Stoneridge, Inc. 52,700 514
Superior Industries International, Inc. 60,900 2,074
- + Tower Automotive, Inc. 111,200 1,223
Winnebago Industries, Inc. 50,300 578
---------
28,327
BANKS 4.2%
--------------------------------------------------------------------------------
Anchor Bancorp. Wisconsin, Inc. 56,000 864
Bancorpsouth, Inc. 131,762 1,721
Bank United Corp., Class A 77,200 4,376
Chemical Financial Corp. 32,926 704
Chittenden Corp. 65,000 1,727
Community First Bankshares, Inc. 109,500 1,697
Corus Bankshares, Inc. 34,400 1,365
F&M National Corp. 59,121 1,530
F.N.B. Corp. 52,423 1,127
First Bancorp./Puerto Rico 63,200 1,450
+ First Busey Corp., Class A 32,100 588
First Citizens Bancshares, Class A 27,500 2,035
First Commonwealth Financial Corp. 137,200 1,363
First Financial Bancorp. 109,653 1,700
First Financial Bancshares, Inc. 23,600 726
Frontier Financial Corp. 41,000 769
Hancock Holding Co. 25,445 792
Harbor Florida Bancshares, Inc. 59,700 731
- Imperial Bancorp. 104,063 2,530
+ Independence Community Bank 154,700 2,272
- + Integra Bank Corp. 41,070 1,060
Irwin Financial Corp. 49,100 758
MAF Bancorp., Inc. 54,425 1,306
Merchants New York Bancorp., Inc. 44,000 913
+ Mid-State Bancshares 26,400 779
National Penn Bancshares, Inc. 41,860 890
- + Net.B@nk, Inc. 69,600 605
- Pacific Northwest Bancorp. 36,800 492
Park National Corp. 26,420 2,526
+ PFF Bancorp., Inc. 31,700 586
Provident Bankshares Corp. 65,647 1,243
Queens County Bancorp., Inc. 48,930 1,370
+ Republic Bancorp. 105,700 1,004
Republic Security Financial Corp. 114,200 774
+ Richmond County Financial Corp. 67,100 1,577
Riggs National Corp., Washington, D.C. 66,600 749
S & T Bancorp., Inc. 64,100 1,210
The South Financial Group, Inc. 101,300 1,032
- Southwest Bancorp. of Texas, Inc. 67,700 2,471
+ Sterling Bancshares, Inc. 61,300 1,054
Susquehanna Bancshares, Inc. 92,275 1,303
Texas Regional Bancshares, Inc., Class A 35,300 1,055
The Trust Co. of New Jersey 46,500 668
Trustco Bank Corp. 145,387 1,745
UMB Financial Corp. 50,418 1,708
United Bankshares, Inc. 99,200 1,934
+ United Community Financial Corp. 79,400 556
+ United National Bancorp. 36,000 639
Wesbanco, Inc. 45,500 1,055
Whitney Holding Corp. 53,500 1,976
-----
65,105
</TABLE>
See the Financial Notes, which 53
are integral to this information.
<PAGE> 58
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
BUSINESS MACHINES & SOFTWARE 2.8%
--------------------------------------------------------------------------------
- + Activision, Inc. 56,100 775
- + Advanced Digital Information Corp. 122,000 1,586
Analogic Corp. 30,300 1,070
- Artesyn Technologies, Inc. 89,300 3,628
- + Auspex Systems, Inc. 70,300 712
- Avocent Corp. 101,986 7,235
- Black Box Corp. 44,200 2,912
- Computer Horizons Corp. 52,200 261
- + Concurrent Computer Corp. 127,300 2,244
Fair, Isaac & Co., Inc. 33,900 1,390
- + Hypercom Corp. 80,500 553
+ IKON Office Solutions, Inc. 353,900 1,150
- + Inprise Corp. 144,300 920
- InterVoice-Brite, Inc. 77,600 759
- + Iomega Corp. 638,900 3,137
- + LTX Corp. 112,200 1,571
- + Maxtor Corp. 267,600 2,091
- + Micron Electronics, Inc. 227,900 1,802
- MICROS Systems, Inc. 30,100 594
- + MTI Technology Corp. 56,700 294
- + Netegrity, Inc. 68,450 5,339
- + Procom Technology, Inc. 27,400 622
- PTEK Holdings, Inc. 110,700 225
- SCM Microsystems, Inc. 34,600 1,315
- Systems & Computer Technology Corp. 76,800 1,109
---------
43,294
BUSINESS SERVICES 13.9%
--------------------------------------------------------------------------------
- + 24/7 Media, Inc. 80,300 417
- + 4 Kids Entertainment, Inc. 19,600 283
+ Aaron Rents, Inc., Class A 46,600 734
ABM Industries, Inc. 53,600 1,497
- Actel Corp. 56,800 2,080
- + Actuate Corp. 132,800 3,743
- Advantage Learning Systems, Inc. 81,300 2,414
- Advent Software, Inc. 71,200 4,259
- Advo, Inc. 48,200 1,774
- AHL Services, Inc. 37,200 409
- + Alliance Semiconductor Corp. 97,100 1,942
- Aspen Technology, Inc. 62,400 2,578
- Avant! Corp. 93,100 1,565
- AXENT Technologies, Inc. 68,000 1,305
- Bell & Howell Co. 55,900 1,062
- + Beyond.com Corp. 85,800 64
- + BindView Development Corp. 107,400 839
Bowne & Co., Inc. 85,400 715
- Brady Corp., Class A 54,100 1,677
- + Cambridge Technology Partners, Inc. 148,900 577
- Catalytica, Inc. 78,400 1,053
- CDI Corp. 45,200 718
- Century Business Services, Inc. 223,700 252
- Cerner Corp. 80,000 4,955
- Choicepoint, Inc. 95,272 4,877
- + Com21, Inc. 38,800 420
- + Complete Business Solutions, Inc. 84,100 873
Computer Task Group, Inc. 48,200 253
- Cytec Industries, Inc. 95,600 3,310
- Dendrite International, Inc. 93,250 2,028
- Digital River, Inc. 51,300 335
- Documentum, Inc. 42,200 3,587
- + EarthWeb, Inc. 24,500 309
- eBT International, Inc. 38,300 124
- + Echelon Corp. 78,600 2,496
- + Eclipsys Corp. 87,400 2,158
- + ePresene, Inc. 55,500 392
- F.Y.I., Inc. 36,300 1,457
FactSet Research Systems, Inc. 77,500 2,935
- FileNet Corp. 80,900 2,144
- Forrester Research, Inc. 49,500 2,033
G & K Services, Inc., Class A 48,950 1,352
- + Global Imaging Systems, Inc. 42,200 227
Great American Financial Resources, Inc. 100,150 1,778
- Great Plains Software, Inc. 47,700 1,857
- GTECH Holdings, Corp. 82,200 1,423
- HA-LO Industries, Inc. 150,237 582
- Hyperion Solutions Corp. 76,345 1,069
- IDT Corp. 64,000 2,288
- + IDX Systems Corp. 66,300 2,122
- + iGate Capital Corp. 99,400 503
</TABLE>
54 See the Financial Notes, which
are integral to this information.
<PAGE> 59
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- + Infocure Corp. 80,700 411
- + Infocus Corp. 89,000 3,933
- Invitrogen Corp. 55,314 4,207
- + Iron Mountain, Inc. 129,920 4,393
Jack Henry & Associates, Inc. 96,200 5,291
- Jacobs Engineering Group, Inc. 63,000 2,607
- + JDA Software Group, Inc. 57,000 859
John H. Harland Co. 67,600 938
- Kroll-O'Gara Co. 52,300 307
- Kronos, Inc. 29,150 1,062
- Labor Ready, Inc. 97,950 294
- Lason, Inc. 46,100 41
- + Learning Tree International, Inc. 51,700 2,339
- + Liberty Satellite & Technology, Inc., Class A 149,800 749
- Lightbridge, Inc. 27,530 294
- +(10)Manugistics Group, Inc. 67,600 7,702
- MAXIMUS, Inc. 50,400 1,238
- MemberWorks, Inc. 39,000 1,341
Mentor Corp. 55,900 985
- Mentor Graphics Corp. 151,300 3,546
- Mercator Software, Inc. 68,900 314
- + Mercury Computer Systems, Inc. 50,600 1,569
- + MicroStrategy, Inc. 58,100 1,391
- + Modis Professional Services, Inc. 226,400 934
- + Mpower Communications Corp. 108,750 707
+ National Data Corp. 77,500 2,955
- + NationsRent, Inc. 134,800 303
- + Natural MicroSystems Corp. 81,600 3,687
- + Navigant Consulting Co. 96,000 366
- + Netmanage, Inc. 148,800 191
- + Network Peripherals, Inc. 34,600 376
New England Business Service, Inc. 32,200 559
- + Novadigm, Inc. 46,900 469
- + NYFIX, Inc. 58,550 2,313
- + Ogden Corp. 117,000 1,609
- On Assignment, Inc. 54,300 1,368
- + Orbital Sciences Corp. 88,000 698
- PAXAR Corp. 103,435 847
- Pegasus Solutions, Inc. 58,050 990
- Performance Food Group Co. 33,200 1,345
- + Phoenix Technologies Ltd. 62,100 997
+ Pittston Brink's Group 122,600 1,946
PolyOne Corp. 228,100 1,796
- Pre-Paid Legal Services, Inc. 53,300 2,339
- Priority Healthcare Corp., Class B 53,727 2,888
- ProBusiness Services, Inc. 55,800 1,824
- Progress Software Corp. 84,200 1,331
- Project Software & Development, Inc. 51,400 668
- (2) Protein Design Labs, Inc. 101,500 13,710
- + Provant, Inc. 48,700 318
- + Proxim, Inc. 60,600 3,674
- + Puma Technology, Inc. 99,000 1,343
- QRS Corp. 35,550 300
- R.H. Donnelley Corp. 75,600 1,710
- + Radiant Systems, Inc. 65,100 1,200
- + RadiSys Corp. 40,800 1,081
- Remedy Corp. 74,300 1,272
- + Rural Cellular Corp., Class A 26,500 1,424
- S3, Inc. 217,200 1,962
- SAGA Systems, Inc. 69,300 372
- Sanchez Computer Associates, Inc. 58,700 943
- + The Santa Cruz Operation, Inc. 65,800 280
- + Seachange International, Inc. 51,150 1,125
- Seacor Smit, Inc. 40,750 1,706
- Sirius Satellite Radio, Inc. 99,600 5,005
- + SITEL Corp. 164,800 463
- + SoftNet Systems, Inc. 66,300 307
Spartech Corp. 55,500 857
- + SportsLine.com, Inc. 61,900 530
Standard Register Co. 64,700 776
- + StarTek, Inc. 33,100 842
Strayer Education, Inc. 36,700 883
- Structural Dynamics Research Corp. 85,200 879
- + Sylvan Learning Systems, Inc. 80,900 1,249
- Syntel, Inc. 90,200 851
- Tetra Tech, Inc. 93,475 3,248
- + Transaction Systems Architects, Inc., Class A 78,100 1,054
- + Unify Corp. 38,300 19
- UNOVA, Inc. 104,700 504
</TABLE>
See the Financial Notes, which 55
are integral to this information.
<PAGE> 60
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- URS Corp. 38,400 492
- Volt Information Sciences, Inc. 36,700 798
WABTEC 121,679 1,232
- The Wackenhut Corp., Class A 35,600 449
Wallace Computer Services, Inc. 94,800 1,375
- Washington Group International, Inc. 123,800 1,300
- + Wave Systems Corp., Class A 108,100 1,250
- + Zixit Corp. 34,100 833
---------
216,777
CHEMICAL 1.6%
--------------------------------------------------------------------------------
A. Schulman, Inc. 69,600 761
- Airgas, Inc. 155,400 1,049
Albemarle Corp. 108,100 2,507
+ Amcol International Corp. 63,200 466
Cambrex Corp. 59,200 2,364
Chemfirst, Inc. 35,900 826
Ethyl Corp. 167,200 334
Ferro Corp. 81,700 1,675
H.B. Fuller Co. 33,500 1,133
- International Specialty Products, Inc. 161,700 1,011
Lilly Industries, Inc., Class A 54,850 1,645
MacDermid, Inc. 73,700 1,585
+ Olin Corp. 106,700 1,894
OM Group, Inc. 56,300 2,604
Rollins, Inc. 71,000 1,282
Tredegar Corp. 90,100 1,718
- Twinlab Corp. 66,600 350
- + W.R. Grace & Co. 158,300 604
WD-40 Co. 36,100 790
+ Wellman, Inc. 75,000 1,125
+ Xceed, Inc. 17,300 14
---------
25,737
CONSTRUCTION 3.1%
--------------------------------------------------------------------------------
Centex Construction Products, Inc. 44,600 1,157
+ D.R. Horton, Inc. 159,273 2,947
- DAL-Tile International, Inc. 129,800 1,606
- Del E. Webb Corp. 43,900 1,180
- Dycom Industries, Inc. 98,900 3,721
Elcor Corp. 46,150 718
Florida Rock Industries, Inc. 44,000 1,710
Granite Construction, Inc. 64,550 1,473
- Insituform Technologies, Inc., Class A 58,600 2,091
- + Integrated Electrical Services, Inc. 88,600 609
+ Kaufman & Broad Home Corp. 114,100 3,394
+ Lennar Corp. 145,926 4,688
- NCI Building Systems, Inc. 42,100 655
- NVR, Inc. 21,700 2,244
+ Owens Corning 100,900 139
- Palm Harbor Homes, Inc. 54,387 795
+ Pulte Corp. 95,400 3,178
- + Quanta Services, Inc. 152,450 4,735
The Ryland Group, Inc. 30,500 984
- Simpson Manufacturing, Inc. 28,600 1,219
- Specialty Equipment Cos., Inc. 46,500 1,410
Standard Pacific Corp. 69,800 1,309
Texas Industries, Inc. 49,800 1,161
- Toll Brothers, Inc. 85,600 2,782
- + U.S. Plastic Lumber Corp. 81,900 118
United Dominion Industries Ltd. 92,600 2,055
Walter Industries, Inc. 110,700 823
---------
48,901
CONSUMER: DURABLE 0.7%
-------------------------------------------------------------------------------
- + Applica, Inc. 54,500 276
- + Champion Enterprises, Inc. 111,600 432
- + Furniture Brands International, Inc. 116,700 1,969
- + Genlyte Group, Inc. 32,300 836
+ Haverty Furniture Cos., Inc. 48,600 547
- Helen of Troy Ltd. 68,300 393
Kimball International, Inc., Class B 94,900 1,477
La-Z-Boy, Inc. 143,200 2,255
- Rent-A-Center, Inc. 57,300 1,672
SLI, Inc. 81,350 671
- Sunbeam Corp. 222,434 209
Toro Co. 30,400 1,064
---------
11,801
CONSUMER: NONDURABLE 2.6%
-------------------------------------------------------------------------------
- + The 3DO Co. 84,100 258
- Acclaim Entertainment, Inc. 127,000 167
Applebee's International, Inc. 63,200 1,909
</TABLE>
56 See the Financial Notes, which
are integral to this information.
<PAGE> 61
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Aura Systems, Inc. 4,312 3
+ CBRL Group, Inc. 134,900 2,411
- CEC Entertainment, Inc. 63,900 2,037
- The Cheesecake Factory 72,950 3,233
+ CKE Restaurants, Inc. 117,200 264
- Cytyc Corp. 87,900 5,218
- Department 56, Inc. 33,900 481
+ Dover Downs Entertainment, Inc. 88,800 1,043
- Fossil, Inc. 75,900 991
- Handleman Co. 64,900 641
- Hanover Direct, Inc. 473,400 266
- IHOP Corp. 47,800 1,010
- Jack in the Box, Inc. 90,600 2,220
- + JAKKS Pacific, Inc. 33,400 294
The Marcus Corp. 69,525 986
- Midway Games, Inc. 89,066 690
Movado Group, Inc. 31,100 447
- + NPC International, Inc. 53,100 591
+ Oneida Ltd. 38,500 409
- Papa John's International, Inc. 58,300 1,465
Regis Corp. 95,750 1,448
Ruby Tuesday, Inc. 144,548 1,960
Russ Berrie & Co., Inc. 47,100 1,069
- Ryan's Family Steak Houses, Inc. 76,000 636
- Sonic Corp. 42,200 1,540
+ Stewart Enterprises, Inc., Class A 250,100 531
- + The Topps Co., Inc. 107,100 967
- Trans World Entertainment Corp. 113,750 967
- Triarc Cos., Inc. 54,300 1,354
Tupperware Corp. 136,400 2,336
---------
39,842
CONTAINERS 0.3%
--------------------------------------------------------------------------------
+ Ball Corp. 69,000 2,424
- + Gaylord Container Corp. Class A 123,800 271
Greif Brothers Corp., Class A 52,800 1,690
---------
4,385
ELECTRONICS 10.3%
--------------------------------------------------------------------------------
- + Adaptive Broadband Corp. 88,800 1,426
- + Advanced Radio Telecom Corp. 68,500 270
- Alliant Techsystems, Inc. 22,200 1,997
- + Anadigics, Inc. 62,500 1,398
- Anixter International, Inc. 87,700 2,127
- + Asyst Technologies, Inc. 75,900 1,138
- ATMI, Inc. 70,200 1,325
- AVT Corp. 72,300 454
- Aware, Inc. 53,600 1,658
Belden, Inc. 57,900 1,502
- Benchmark Electronics, Inc. 45,500 1,831
- + Brooks Automation, Inc. 41,100 1,089
C&D Technologies, Inc. 62,600 3,701
- + C-COR.net Corp. 80,300 1,255
- Cable Design Technologies Corp. 101,575 2,343
- Cirrus Logic, Inc. 156,300 6,740
- + Coherent, Inc. 63,700 2,218
+ Cohu, Inc. 41,400 655
- + Computer Network Technology Corp. 57,300 1,741
- Concord Communications, Inc. 38,000 294
- Cox Radio, Inc., Class A 95,500 2,173
- + Cyberonics, Inc. 44,200 1,028
- Data Broadcasting Corp. 213,800 942
- Dionex Corp. 52,100 1,690
- DMC Stratex Networks, Inc. 168,600 3,899
- + DSP Group, Inc. 63,800 1,810
- Dupont Photomasks, Inc. 41,400 2,324
- Electro Scientific Industries, Inc. 63,200 2,208
- + Electroglas, Inc. 48,800 686
- + ESS Technology, Inc. 102,100 1,583
- + Exar Corp. 88,500 3,955
- + General Semiconductor, Inc. 88,900 1,017
- Genrad, Inc. 70,300 641
Gerber Scientific, Inc. 51,100 409
Harman International Industries, Inc. 81,200 3,898
- Hearst-Argyle Television, Inc. 120,000 2,152
- + Hollywood Entertainment Corp. 108,200 331
- Hutchinson Technology, Inc. 58,900 1,292
- IMRglobal Corp. 96,800 799
- International Rectifier Corp. 145,000 6,471
- Kent Electronics Corp. 67,000 1,248
- + Kopin Corp. 148,700 2,100
- Kulicke & Soffa Industries, Inc. 114,400 1,680
</TABLE>
See the Financial Notes, which 57
are integral to this information.
<PAGE> 62
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Littelfuse, Inc. 46,200 1,340
- MEMC Electronic Materials, Inc. 163,604 1,626
Methode Electronics, Inc., Class A 84,950 3,196
- + MRV Communications, Inc. 136,000 5,372
- + Mynd Corp. 77,300 986
- + Netopia, Inc. 39,700 432
- + P-Com, Inc. 181,500 1,021
+ Park Electrochemical Corp. 25,500 1,685
- Paxson Communications Corp. 129,500 1,473
- Photronics, Inc. 70,300 1,586
- Pinnacle Systems, Inc. 118,300 1,494
+ Pioneer Standard Electronics, Inc. 63,900 887
- + Plantronics, Inc. 115,600 5,274
- Plexus Corp. 94,400 5,953
- + Power Intergrations, Inc. 64,600 868
- +(4)Power-One, Inc. 174,000 12,343
- PRI Automation, Inc. 49,500 1,120
- Rayovac Corp. 64,500 951
- Remec, Inc. 104,350 3,111
- + REX Stores Corp. 15,376 283
- + Silicon Storage Technology, Inc. 211,200 4,805
- Silicon Valley Group, Inc. 80,900 2,665
- + Spectrian Corp. 28,100 339
- + SpeedFam-IPEC, Inc. 69,700 662
- STAR Telecommunications, Inc. 102,900 167
Superior TeleCom, Inc. 40,284 199
Technitrol, Inc. 38,900 4,313
- Tekelec, Inc. 136,800 5,036
- + THQ, Inc. 45,700 937
- + Three-Five Systems, Inc. 51,049 1,761
- + Tweeter Home Entertainment Group, Inc. 42,100 1,013
- Varian Medical Systems, Inc. 75,600 3,695
Vector Group Ltd. 54,300 757
- + Western Digital Corp. 339,000 2,034
- + Youthstream Media Networks, Inc. 65,800 127
- + Zoran Corp. 34,700 1,739
---------
160,748
ENERGY: RAW MATERIALS 2.4%
--------------------------------------------------------------------------------
Arch Coal, Inc. 89,500 973
- + Atwood Oceanics, Inc. 32,900 1,104
- Barrett Resources Corp. 78,700 2,863
- + Basin Exploration, Inc. 44,000 872
Cabot Oil & Gas Corp., Class A 68,300 1,340
- + Dril-Quip, Inc. 41,100 1,356
- + Evergreen Resources, Inc. 35,200 968
- Forest Oil Corp. 127,400 1,760
- + Friede Goldman Halter, Inc. 115,000 661
- + Grey Wolf, Inc. 424,300 1,962
Helmerich & Payne, Inc. 117,700 3,700
- + Key Energy Services, Inc. 226,100 2,035
- Kirby Corp. 58,100 1,071
- Louis Dreyfus Natural Gas Corp. 101,900 3,267
+ McDermott International, Inc. 142,200 1,378
- Newpark Resources, Inc. 163,400 1,471
NL Industries, Inc. 118,900 2,809
- + Parker Drilling Co. 182,100 1,093
- + Tom Brown, Inc. 83,700 1,915
+ USEC, Inc. 202,000 1,035
- + UTI Energy Corp. 87,400 1,753
+ Western Gas Resources, Inc. 76,000 1,667
---------
37,053
FOOD & AGRICULTURE 2.1%
--------------------------------------------------------------------------------
- + Agribrands International, Inc. 23,900 1,040
- American Italian Pasta Co., Class A 43,500 873
- + Aurora Foods, Inc. 129,800 365
Bob Evans Farms, Inc. 83,900 1,578
Coca-Cola Bottling Co. Consolidated 20,800 749
+ Delta & Pine Land Co. 90,900 2,221
+ Dole Food Co., Inc. 132,000 1,592
Dreyer's Grand Ice Cream, Inc. 66,600 1,640
+ Earthgrains Co. 100,300 2,031
Fleming Cos., Inc. 93,700 1,329
- Fresh Del Monte Produce, Inc. 114,600 451
- + Grand Union Co. 73,000 3
Lance, Inc. 68,000 684
Michael Foods, Inc. 44,300 1,193
- Ralcorp Holdings, Inc. 69,966 984
</TABLE>
58 See the Financial Notes, which
are integral to this information.
<PAGE> 63
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- The Scotts Co., Class A 66,000 2,359
Seaboard Corp. 4,200 735
- + Smithfield Foods, Inc. 133,800 3,838
+ Tootsie Roll Industries, Inc. 79,259 3,042
Universal Foods Corp. 114,800 2,267
- Vlasic Foods International, Inc. 73,100 105
- + Whole Foods Market, Inc. 63,100 2,918
- Wild Oats Markets, Inc. 53,900 340
---------
32,337
GOLD 0.0%
--------------------------------------------------------------------------------
- Battle Mountain Gold Co. 261,230 359
HEALTHCARE / DRUGS & MEDICINE 16.1%
--------------------------------------------------------------------------------
- +(1)Abgenix, Inc. 192,300 15,168
- Acuson Corp. 65,700 1,499
- Advance Paradigm, Inc. 59,800 2,923
- Alkermes, Inc. 127,500 4,725
Alpharma, Inc., Class A 94,567 3,670
- + Amerisource Health Corp., Class A 122,400 5,317
- Apria Healthcare Group, Inc. 123,300 2,466
Arrow International, Inc. 52,400 2,112
- + Avigen, Inc. 40,000 1,550
- Barr Laboratories, Inc. 82,500 5,208
+ Bergen Brunswig Corp., Class A 317,400 2,876
- Beverly Enterprises, Inc. 239,200 1,196
Bindley Western Industries, Inc. 82,198 2,954
- Bio-Technology General Corp. 129,000 1,354
- Biomatrix, Inc. 50,300 962
- Caremark Rx, Inc. 499,900 6,249
Carter-Wallace, Inc. 107,500 2,950
- (8) Celgene Corp. 152,200 9,798
- + Cephalon, Inc. 97,500 5,228
- + Cerus Corp. 30,500 1,704
- Conmed Corp. 36,900 542
+ Cooper Cos., Inc. 33,700 1,205
- + COR Therapeutics, Inc. 127,200 7,187
- + Covance, Inc. 134,700 1,162
- Coventry Health Care, Inc. 139,900 2,553
- + CV Therapeutics, Inc. 44,000 3,465
Datascope Corp. 35,200 1,219
- + DaVita, Inc. 188,200 2,117
Diagnostic Products Corp. 32,900 1,501
- Dura Pharmaceuticals, Inc. 105,600 3,637
- + Entremed, Inc. 37,200 1,158
- + Enzo Biochem, Inc. 60,700 2,337
- Foundation Health Systems, Inc., Class A 289,000 5,834
- Haemonetics Corp. 59,000 1,386
- + Henry Schein, Inc. 96,800 2,359
Hooper Holmes, Inc. 159,600 1,515
- Idexx Laboratories, Inc. 82,000 1,968
- Igen International, Inc. 37,800 940
- +(9)ImClone Systems 147,400 8,061
- Incyte Genomics, Inc. 150,900 5,527
- Inhale Therapeutic Systems, Inc. 99,500 4,950
Invacare Corp. 71,900 2,049
- Isis Pharmaceuticals, Inc. 90,000 928
- + KV Pharmaceutical Co., Class A 56,250 2,190
- + Laboratory Corp. of America Holdings, Inc. 32,790 4,423
- + Laser Vision Centers, Inc. 59,500 242
- + Ligand Pharmaceuticals, Inc., Class B 62,600 931
- +(6)Medarex, Inc. 170,400 10,416
- Medicis Pharmaceutical Corp., Class A 69,200 5,095
- Mid Atlantic Medical Services, Inc. 111,400 1,894
Mine Safety Appliances Co. 33,600 706
- + Myriad Genetics, Inc. 53,500 6,420
- NBTY, Inc. 161,600 1,050
- Oakley, Inc. 161,800 3,398
- Ocular Sciences, Inc. 54,700 677
- Orthodontic Centers of America, Inc. 115,300 3,848
Owens & Minor, Inc. 77,800 1,177
- Perrigo Co. 172,000 1,139
- Pharmaceutical Product Development, Inc. 59,200 1,854
- + Pharmacopeia, Inc. 54,500 995
- + Pharmacyclics, Inc. 38,000 2,045
- + Province Healthcare Co. 71,900 3,029
- + PSS World Medical, Inc. 139,900 420
# -(5)Quest Diagnostic, Inc. 108,600 10,453
- Quorum Health Group, Inc. 168,500 2,254
</TABLE>
See the Financial Notes, which 59
are integral to this information.
<PAGE> 64
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- + Renal Care Group, Inc. 109,100 2,564
- ResMed, Inc. 72,000 1,836
- Sangstat Medical Corp. 32,700 327
- SICOR, Inc. 227,600 2,916
- Sola International, Inc. 55,800 241
- + Steris Corp. 158,800 2,382
- + Sunrise Technologies International 113,400 819
- + SuperGen, Inc. 78,600 1,012
- + Syncor International Corp. 56,800 1,459
- Techne Corp. 48,800 5,502
- Transkaryotic Therapies, Inc. 54,100 2,015
- + Triangle Pharmaceuticals, Inc. 90,000 757
- + Universal Health Services, Class B 71,200 5,972
- US Oncology, Inc. 217,872 1,171
- (3) Vertex Pharmaceuticals, Inc. 137,300 12,784
- + Vical, Inc. 46,800 994
- + Viropharma, Inc. 35,600 832
West Pharmaceutical Services, Inc. 34,100 750
---------
252,498
HOUSEHOLD PRODUCTS 0.4%
--------------------------------------------------------------------------------
- Bush Boake Allen, Inc. 46,100 2,230
Church & Dwight Co., Inc. 90,800 1,793
- + NU Skin Enterprises, Inc., Class A 72,000 391
- Playtex Products, Inc. 143,500 1,453
---------
5,867
INSURANCE 3.6%
--------------------------------------------------------------------------------
Alfa Corp. 91,800 1,767
- AmerUs Group Co. 59,100 1,559
Argonaut Group, Inc. 52,200 897
Arthur J. Gallagher & Co. 90,800 5,732
Brown & Brown, Inc. 67,000 2,178
CNA Surety Corp. 100,700 1,171
+ Commerce Group, Inc. 81,200 2,076
- Delphi Financial Group, Inc., Class A 47,871 1,771
E.W. Blanch Holdings, Inc. 30,900 583
Enhance Financial Services Group, Inc. 90,000 1,046
FBL Financial Group, Inc., Class A 70,900 1,139
+ First American Corp. 150,200 3,145
+ Fremont General Corp. 164,100 595
Harleysville Group, Inc. 67,800 1,564
HCC Insurance Holdings, Inc. 117,150 2,233
- + HealthAxis, Inc. 19,682 49
+ Hilb, Rogal & Hamilton Co. 31,200 1,236
+ Horace Mann Educators Corp. 95,700 1,609
+ HSB Group, Inc. 68,700 2,718
Kansas City Life Insurance Co. 29,000 941
Liberty Corp. 45,900 1,589
+ Liberty Financial Cos., Inc. 114,400 3,089
- Markel Corp. 17,800 2,579
- Medical Assurance, Inc. 55,431 769
+ Nationwide Financial Services, Inc., Class A 57,087 2,776
+ Ohio Casualty Corp. 141,300 1,188
Presidential Life Corp. 70,600 1,028
+ Reliance Group Holdings, Inc. 174,982 11
RLI Corp. 23,575 922
SCPIE Holdings, Inc. 22,200 422
Selective Insurance Group, Inc. 60,200 1,038
State Auto Financial Corp. 91,200 1,231
Trenwick Group Ltd. 75,750 1,487
- + Triad Guaranty, Inc. 31,500 915
- UICI 109,300 813
W.R. Berkley Corp. 60,400 2,057
Zenith National Insurance Corp. 41,200 937
---------
56,860
MEDIA 1.6%
--------------------------------------------------------------------------------
Ackerly Group, Inc. 56,600 587
- + Actv, Inc. 119,500 1,176
Banta Corp. 58,800 1,356
- Consolidated Graphics, Inc. 31,800 342
- + CTC Communications Group, Inc. 55,150 533
- + Cumulus Media, Inc. Class A 53,300 333
- Cymer, Inc. 69,000 1,725
- + Emusic.com, Inc. 42,200 34
- Gaylord Entertainment Co. 78,400 1,862
Grey Global Group, Inc. 3,400 1,904
John Wiley & Sons, Inc., Class A 143,900 2,941
Journal Register Co. 107,400 1,913
- Loews Cineplex Entertainment Corp. 109,500 103
</TABLE>
60 See the Financial Notes, which
are integral to this information.
<PAGE> 65
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Mail-Well, Inc. 115,900 572
- Metromedia International Group, Inc. 196,800 732
- PanAmSat Corp. 45,200 1,514
Penton Media, Inc. 75,200 2,298
- + Scholastic Corp. 40,900 3,272
- Sinclair Broadcast Group, Inc., Class A 106,600 983
- Young Broadcasting, Inc., Class A 35,200 873
---------
25,053
MISCELLANEOUS 0.9%
--------------------------------------------------------------------------------
- Hain Celestial Group, Inc. 68,700 2,727
- ITT Educational Services, Inc. 56,750 894
- + MCSi, Inc. 29,100 837
- (7) Sabre Group Corp. 304,900 10,195
---------
14,653
MISCELLANEOUS FINANCE 4.7%
--------------------------------------------------------------------------------
1st Source Corp. 47,034 738
Advanta Corp., Class A 64,209 658
- Affiliated Managers Group, Inc. 52,900 3,181
AMCORE Financial, Inc. 63,650 1,249
+ American Capital Strategies Ltd. 58,000 1,280
Area Bancshares Corp. 38,200 797
Bay View Capital Corp. 76,800 624
- BOK Financial Corp. 115,467 2,194
BT Financial Corp. 39,890 780
Cathay Bancorp., Inc. 21,400 1,055
+ Commercial Federal Corp. 133,700 2,340
CVB Financial Corp. 58,575 977
Dain Rauscher Corp. 30,600 2,871
Downey Financial Corp. 66,871 3,193
Fidelity National Financial, Inc. 158,882 3,903
- Financial Federal Corp. 34,900 739
First Sentinel Bancorp., Inc. 82,562 766
+ Greater Bay Bancorp. 94,000 3,061
+ Heller Financial, Inc. 107,000 3,130
International Bancshares Corp. 51,237 1,835
- + Investment Technology Group, Inc. 74,000 2,664
Investors Financial Services Corp. 70,400 5,047
- Kforce.com, Inc. 83,400 339
MDC Holdings, Inc. 50,100 1,371
- + MessageMedia, Inc. 129,400 279
Morgan Keegan, Inc. 67,950 1,355
- + National Discount Broker Group, Inc. 49,600 2,415
Northwest Bancorp., Inc. 111,100 826
- Ocwen Financial Corp. 143,500 843
Pacific Capital Bancorp. 58,400 1,562
Phoenix Investment Partners Ltd. 104,900 1,639
Raymond James Financial, Inc. 108,900 3,682
+ Siebert Financial Corp. 53,200 333
- + SierraCities.com, Inc. 44,900 180
+ Southwest Securities Group 37,530 1,060
Staten Island Bancorp., Inc. 85,800 1,657
Student Loan Corp. 47,800 2,557
Value Line, Inc. 23,600 823
+ Waddell & Reed Financial, Inc., Class A 194,350 6,195
Webster Financial Corp. 126,000 3,071
---------
73,269
NON-FERROUS METALS 0.5%
--------------------------------------------------------------------------------
Commercial Metals Co. 33,633 916
- Kaiser Aluminum Corp. 186,900 946
- MAXXAM, Inc. 15,900 302
Minerals Technologies, Inc. 48,100 1,506
Reliance Steel & Aluminum Co. 66,075 1,569
- Stillwater Mining Co. 91,700 2,659
---------
7,898
OIL: DOMESTIC 2.6%
--------------------------------------------------------------------------------
- + CAL Dive International, Inc. 37,400 1,861
Cross Timbers Oil Co. 174,787 3,288
- Global Industries Ltd. 216,800 2,276
- Houston Exploration Co. 69,000 1,553
- National-Oilwell, Inc. 189,200 5,534
- Newfield Exploration Co. 100,900 3,809
- + Nuevo Energy Co. 41,500 752
- + Patterson Energy, Inc. 81,100 2,281
+ Pennzoil-Quaker State Co. 185,400 2,178
- Pioneer Natural Resources Co. 233,800 3,054
Pogo Producing Co. 95,200 2,380
</TABLE>
See the Financial Notes, which 61
are integral to this information.
<PAGE> 66
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Pride International, Inc. 155,400 3,934
- Stone Energy Corp. 43,600 2,232
- + Superior Energy Services 159,000 1,431
- Tesoro Petroleum Corp. 73,300 760
Vintage Petroleum, Inc. 148,700 3,141
---------
40,464
OPTICAL & PHOTO 0.3%
--------------------------------------------------------------------------------
- + Ingram Micro, Inc., Class A 173,100 2,954
Polaroid Corp. 105,700 1,064
- + Zomax, Inc. 56,700 344
---------
4,362
PAPER & FOREST PRODUCTS 0.5%
--------------------------------------------------------------------------------
- Buckeye Technologies, Inc. 82,300 1,409
Caraustar Industries, Inc. 60,700 611
Chesapeake Corp. 37,300 732
Longview Fibre Co. 122,200 1,665
PH Glatfelter Co. 99,400 1,037
Rock Tennessee Co., Class A 51,930 464
- Thermo Fibertek, Inc. 143,700 593
Universal Forest Products, Inc. 47,400 640
Wausau Mosinee Paper Corp. 120,725 1,056
---------
8,207
PRODUCER GOODS & MANUFACTURING 6.5%
--------------------------------------------------------------------------------
- Advanced Energy Industries, Inc. 68,800 1,187
AGCO Corp. 140,700 1,600
- Albany International Corp., Class A 72,183 776
Ametek, Inc. 75,600 1,644
+ Applied Industrial Technologies, Inc. 47,600 806
- Applied Micro Circuits Corp. 95,573 7,305
AptarGroup, Inc. 84,100 1,740
- Astec Industries, Inc. 31,700 327
Baldor Electric, Co. 79,720 1,584
Barnes Group, Inc. 43,900 845
CLARCOR, Inc. 57,750 1,104
- Comfort Systems USA, Inc. 87,100 256
- + Cuno, Inc. 38,800 985
Curtiss-Wright Corp. 23,600 1,112
- + Daisytek International Corp. 40,100 195
- + Diamond Technology Partners, Inc. 50,700 2,262
- + Encompass Services Corp. 144,033 657
+ Federal Signal Corp. 106,700 2,494
- + Fisher Scientific International 94,500 3,632
- Flowserve Corp. 88,834 1,788
Foster Wheeler Corp. 95,700 706
Franklin Electric Co., Inc. 13,200 899
Graco, Inc. 48,437 1,741
- Hanover Compressor Co. 138,500 4,519
- Harbor Global Co. Ltd. 12,760 51
+ Helix Technology Corp. 53,500 1,491
Hughes Supply, Inc. 55,650 1,043
- + Ibis Technology Corp. 19,800 750
IDEX Corp. 71,625 2,310
- Ionics, Inc. 31,700 664
JLG Industries, Inc. 103,300 1,440
+ Kaydon Corp. 70,700 1,551
Kennametal, Inc. 71,600 2,103
Libbey, Inc. 36,200 986
Lincoln Electric Holdings, Inc. 100,700 1,731
- Lone Star Technologies, Inc. 56,900 2,285
Manitowoc Co., Inc. 58,062 1,579
- Marine Drilling Co., Inc. 138,200 3,300
MascoTech, Inc. 105,500 1,761
Matthews International Corp., Class A 31,700 856
- + Maverick Tube Corp. 41,800 651
Metals USA, Inc. 57,228 161
Milacron, Inc. 82,200 1,310
- MSC Industrial Direct Co., Class A 80,100 1,191
Nacco Industries, Inc., Class A 19,750 752
Nordson Corp. 76,000 2,180
Precision Castparts Corp. 117,400 4,432
- + Presstek, Inc. 77,000 1,213
Regal Beloit 49,600 831
Roper Industries, Inc. 72,000 2,520
+ Sauer-Danfoss, Inc. 106,300 804
- + Scott Technologies, Inc. 39,600 911
- + Shaw Group, Inc. 46,600 3,798
- SPS Technologies, Inc. 30,000 1,549
+ Steelcase, Inc., Class A 71,900 1,267
+ Stewart & Stevenson Services 66,300 1,591
</TABLE>
62 See the Financial Notes, which
are integral to this information.
<PAGE> 67
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Tecumseh Products Co., Class A 45,400 1,810
Tennant Co. 21,500 935
- Terex Corp. 65,500 806
- UCAR International, Inc. 106,400 878
- Ultratech Stepper, Inc. 50,400 1,184
Valmont Industries, Inc. 54,700 1,115
Watsco, Inc. 63,600 599
Watts Industries, Inc., Class A 62,400 698
- + WMS Industries, Inc. 72,900 1,622
+ York International Corp. 90,300 2,455
---------
101,328
RAILROAD & SHIPPING 0.4%
--------------------------------------------------------------------------------
Alexander & Baldwin, Inc. 95,800 2,389
Overseas Shipholding Group, Inc. 80,100 1,922
- Wisconsin Central Transportation Corp. 115,800 1,484
---------
5,795
REAL PROPERTY 0.4%
--------------------------------------------------------------------------------
- Fairfield Communities, Inc. 95,200 1,208
Forest City Enterprises, Inc., Class A 71,300 2,638
LNR Property Corp. 55,500 1,200
- Trammell Crow Co. 82,800 1,107
---------
6,153
RETAIL 2.8%
--------------------------------------------------------------------------------
- 7-Eleven, Inc. 247,340 2,613
- + 99 Cents Only Stores 80,100 1,797
- Ames Department Stores, Inc. 55,400 218
Burlington Coat Factory Warehouse Corp. 105,140 1,656
Casey's General Stores, Inc. 117,000 1,463
- Charming Shoppes, Inc. 238,800 1,463
Claire's Stores, Inc. 121,575 2,447
- + Cost Plus, Inc. 49,800 1,394
- + Duane Reade, Inc. 42,100 1,229
- Egghead.com, Inc. 69,048 160
+ Great Atlantic & Pacific Tea Co., Inc. 76,900 769
- Insight Enterprises, Inc. 96,550 3,138
- + Intertan, Inc. 68,700 760
+ Longs Drug Stores, Inc. 89,400 1,956
- Michaels Stores, Inc. 86,100 2,093
- + OfficeMax, Inc. 265,700 764
- + PC Connection, Inc. 57,050 1,556
Pep Boys--Manny, Moe, & Jack 124,800 562
- + PetSmart, Inc. 263,100 1,168
Pier 1 Imports, Inc. 227,700 3,017
Ruddick Corp. 109,400 1,436
- + Shop At Home, Inc. 40,800 82
- ShopKo Stores, Inc. 69,600 444
Spiegel, Inc., Class A 311,300 2,160
- + Sunglass HUT International, Inc. 96,500 748
- Systemax, Inc. 80,300 191
- United Stationers, Inc. 80,700 2,426
- Value City Department Stores, Inc. 79,400 645
- Venator Group, Inc. 325,500 4,598
- + Whitehall Jewellers, Inc. 39,150 313
---------
43,266
STEEL 0.3%
--------------------------------------------------------------------------------
- + Bethlehem Steel Corp. 310,900 894
Carpenter Technology Corp. 52,500 1,628
Cleveland-Cliffs, Inc. 24,800 512
- LTV Corp. 205,500 244
Ryerson Tull, Inc. 58,400 438
- Steel Dynamics, Inc. 96,300 1,156
---------
4,872
TELEPHONE 1.5%
--------------------------------------------------------------------------------
- Brightpoint, Inc. 115,450 768
- CellStar Corp. 93,500 216
+ CFW Communication Co. 31,100 618
- ICG Communications, Inc. 44,500 19
Inter-Tel, Inc. 62,000 717
- + Interdigital Communications Corp. 124,600 1,363
- + Leap Wireless International, Inc. 63,500 3,159
- + Neon Communications, Inc. 38,700 467
- Optical Cable Corp. 133,150 2,122
- Pacific Gateway Exchange, 24,400 18
- + Pegasus Communications Corp. 107,700 3,830
- Primus Telecommunications Group, Inc. 80,400 407
</TABLE>
See the Financial Notes, which 63
are integral to this information.
<PAGE> 68
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- TALK.com, Inc. 184,800 572
- + Teligent, Inc., Class A 75,000 570
- Varco International, Inc. 219,528 3,787
- West Teleservices Corp. 151,500 3,863
- World Access, Inc. 121,400 592
---------
23,088
TOBACCO 0.1%
--------------------------------------------------------------------------------
+ Universal Corp. 66,500 1,862
TRAVEL & RECREATION 1.9%
- AMERCO, Inc. 52,700 1,067
- + American Classic Voyager Co. 49,100 678
- Anchor Gaming, Inc. 27,600 2,344
- + Argosy Gaming Co. 67,200 1,092
- Avis Group Holdings, Inc. 73,900 2,208
- + Aztar Corp. 96,100 1,454
- Bally Total Fitness Holding Corp. 57,000 1,421
Callaway Golf Co. 178,500 2,856
Central Parking Corp. 86,100 1,652
- Choice Hotels International, Inc. 124,800 1,466
- + Dollar Thrifty Automotive Group, Inc. 57,400 883
- Extended Stay America, Inc. 225,100 2,772
- + Intranet Solutions, Inc. 51,000 2,372
- + Marketing Services Group, Inc. 42,200 73
- Prime Hospitality Corp. 105,900 1,006
- Rent-Way, Inc. 57,200 290
- + Sodexho Marriott Services, Inc. 149,100 2,740
- + Station Casinos, Inc. 142,500 2,298
- Vail Resorts, Inc. 63,900 1,354
---------
30,026
TRUCKING & FREIGHT 1.2%
--------------------------------------------------------------------------------
- American Freightways Corp. 76,500 1,234
Arnold Industries, Inc. 57,800 1,015
- + Forward Air Corp. 51,500 2,118
- Fritz Cos., Inc. 86,500 703
- Heartland Express, Inc. 60,347 1,049
J.B. Hunt Transport Services, Inc. 82,450 1,077
- Landstar Systems, Inc. 21,100 997
- M.S. Carriers, Inc. 25,800 403
+ Roadway Express, Inc. 45,600 938
Rollins Truck Leasing Corp. 136,450 716
- + Swift Transportation Co., Inc. 149,300 2,128
USFreightways Corp. 55,200 1,421
Wabash National Corp. 54,100 433
Werner Enterprises, Inc. 111,462 1,560
- XTRA Corp. 29,100 1,324
- Yellow Corp. 58,600 1,055
---------
18,171
UTILITIES: ELECTRIC & GAS 3.8%
--------------------------------------------------------------------------------
+ AGL Resources, Inc. 127,600 2,600
+ American States Water Co. 21,500 671
Atmos Energy Corp. 74,800 1,730
Avista Corp. 111,300 2,497
Black Hills Corp. 54,300 1,697
California Water Service Group 36,000 970
CH Energy Group, Inc. 40,200 1,583
Cleco Corp. 53,300 2,535
E'Town Corp. 21,700 1,462
- El Paso Electric Co. 129,100 1,548
Empire District Electric Co. 42,400 1,174
Energen Corp. 71,900 2,058
+ Hawaiian Electric Industries, Inc. 76,900 2,533
+ Idacorp, Inc. 89,700 4,423
Laclede Gas Co. 44,700 978
Madison Gas & Electric Co. 38,800 844
New Jersey Resources Corp. 42,000 1,677
Northwest Natural Gas Co. 60,100 1,409
Northwestern Corp. 55,000 1,217
NUI Corp. 31,000 967
ONEOK, Inc. 69,900 2,770
Otter Tail Power Co. 56,600 1,256
Philadelphia Suburban Corp. 96,700 2,266
Piedmont Natural Gas Co., Inc. 75,300 2,297
Public Service Co. of New Mexico 93,100 2,566
</TABLE>
64 See the Financial Notes, which
are integral to this information.
<PAGE> 69
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
+ RSG Energy Group, Inc. 83,300 2,457
- Southern Union Co. 117,382 2,208
Southwest Gas Corp. 74,200 1,549
UGI Corp. 63,900 1,482
UIL Holdings Corp. 34,100 1,596
Unisource Energy Corp. Holding Co. 76,580 1,144
- + Veritas DGC, Inc. 65,600 1,968
WPS Resources Corp. 62,700 2,018
---------
60,150
</TABLE>
<TABLE>
SHORT-TERM INVESTMENTS
0.5% of investments
<CAPTION>
SECURITY FACE VALUE MKT. VALUE
RATE, MATURITY DATE ($ x 1,000) ($ x 1,000)
<S> <C> <C>
Bank One Grand Cayman
Time Deposit
6.030%, 11/01/00 2,962 2,962
Wachovia Bank Time Deposit
6.03%, 11/01/00 5,356 5,356
-------
8,318
</TABLE>
<TABLE>
U.S. TREASURY OBLIGATIONS
0.0% of investments
<S> <C> <C>
# U.S. Treasury Bills
6.02%-6.03%, 12/14/00 255 253
</TABLE>
--------------------------------------------------------------------------------
END OF PORTFOLIO HOLDINGS. For totals, please see the first page of
holdings for this fund.
See the Financial Notes, which 65
are integral to this information.
<PAGE> 70
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
Statement of
ASSETS AND LIABILITIES
As of October 31, 2000. All numbers x 1,000 except NAV.
<TABLE>
<CAPTION>
ASSETS
--------------------------------------------------------------------
<S> <C>
Investments, at market value $1,565,111 a
Collateral held for securities on loan 160,136 b
Receivables:
Fund shares sold 1,891
Interest 1
Dividends 506
Investments sold 44
Income from lending securities 53
Most recent daily change in value of futures 82
Prepaid expenses + 68
------------
TOTAL ASSETS 1,727,892
LIABILITIES
--------------------------------------------------------------------
Collateral held for securities on loan 160,136 b
Payables:
Fund shares redeemed 1,251
Investments bought 6,336
Investment adviser and administrator fees 8
Transfer agent and shareholder service fees 32
Accrued expenses + 241
------------
TOTAL LIABILITIES 168,004
NET ASSETS
--------------------------------------------------------------------
TOTAL ASSETS 1,727,892
TOTAL LIABILITIES - 168,004
------------
NET ASSETS $1,559,888
NET ASSETS BY SOURCE
Capital received from investors 1,279,997
Net investment income not yet distributed 5,666
Net realized capital gains 163,915
Net unrealized capital gains 110,310 c
</TABLE>
NET ASSET VALUE (NAV)
<TABLE>
<CAPTION>
SHARES
SHARE CLASS NET ASSETS / OUTSTANDING = NAV
<S> <C> <C> <C>
Investor Shares $803,072 38,140 $21.06
Select Shares(R) $756,816 35,884 $21.09
</TABLE>
a The fund paid $1,454,544 for these securities. Not counting short-term
obligations and government securities, the fund paid $1,161,813 for securities
during the report period and received $701,873 from securities it sold or that
matured. This includes $85,378 in transactions with other SchwabFunds(R).
b Market value of securities loaned: $158,163.
c These derive from investments and futures. As of the report date, the fund had
twelve open Russell 2000 futures contracts due to expire on December 15, 2000,
with a contract value of $3,003 and unrealized losses of $257.
<TABLE>
<CAPTION>
FEDERAL TAX DATA
--------------------------------------------------------------------
<S> <C>
COST BASIS OF PORTFOLIO $1,465,440
NET UNREALIZED GAINS AND LOSSES:
Gains $375,573
Losses + (276,159)
------------
$99,414
RECLASSIFICATIONS:
Net investment income not
yet distributed $1
Reclassified as:
Net realized capital gains ($31,001)
Capital received from
investors $31,000
TAX DESIGNATION (UNAUDITED):
The fund hereby designates $17 million as a capital gain dividend for the fiscal
year ended October 31, 2000.
</TABLE>
66 See the Financial Notes, which
are integral to this information.
<PAGE> 71
Statement of
OPERATIONS
For November 1, 1999 through October 31, 2000. All numbers x 1,000.
<TABLE>
<CAPTION>
INVESTMENT INCOME
--------------------------------------------------------------------
<S> <C>
Dividends $11,510 a
Interest 582
Lending of securities + 54
------------
TOTAL INVESTMENT INCOME 12,146
NET REALIZED GAINS AND LOSSES
--------------------------------------------------------------------
Net realized gains on investments sold 200,536
Net realized gains on futures contracts + 433
------------
NET REALIZED GAINS 200,969
NET UNREALIZED GAINS AND LOSSES
--------------------------------------------------------------------
Net unrealized gains on investments 819
Net unrealized losses on futures contracts + (257)
------------
NET UNREALIZED GAINS 562
EXPENSES
--------------------------------------------------------------------
Investment adviser and administrator fees 4,459 b
Transfer agent and shareholder service fees:
Investor Shares 1,649 c
Select Shares(R) 641 c
Trustees' fees 9 d
Custodian fees 202
Portfolio accounting fees 207
Professional fees 40
Registration fees 215
Shareholder reports 100
Proxy fees 109
Other expenses + 34
------------
Total expenses 7,665
Expense reduction - 1,887 e
------------
NET EXPENSES 5,778
INCREASE IN NET ASSETS FROM OPERATIONS
--------------------------------------------------------------------
TOTAL INVESTMENT INCOME 12,146
NET EXPENSES - 5,778
------------
NET INVESTMENT INCOME 6,368
NET REALIZED GAINS 200,969 f
NET UNREALIZED GAINS + 562 f
------------
INCREASE IN NET ASSETS FROM OPERATIONS $207,899
</TABLE>
a An additional $7 was withheld for foreign taxes.
b Calculated as a percentage of average daily net assets: 0.33% of the first
$500 million and 0.28% of assets beyond that. Prior to February 29, 2000, the
percentages were 0.50% of the first $300 million and 0.45% of assets beyond
that.
c Calculated as a percentage of average daily net assets: for transfer agent
services, 0.05% of the fund's assets; for shareholder services, 0.20%, and
0.05% of the assets of each respective share class.
d For the fund's independent trustees only.
e Includes $1,623 from the investment adviser (CSIM) and $264 from the transfer
agent and shareholder service agent (Schwab). These reductions reflect a
guarantee by CSIM and Schwab to limit the operating expenses of this fund
through at least February 28, 2001, as follows:
<TABLE>
<CAPTION>
% OF AVERAGE
SHARE CLASS DAILY NET ASSETS
--------------------------------------------------------------------
<S> <C>
Investor Shares 0.49
Select Shares 0.38
</TABLE>
This limit does not include interest, taxes and certain non-routine expenses.
f These add up to a net gain on investments of $201,531.
See the Financial, which are 67
integral to this information.
<PAGE> 72
SCHWAB SMALL-CAP INDEX FUND(R) -- FINANCIALS
Statements of
CHANGES IN NET ASSETS
For the current and prior report periods. All numbers x 1,000.
<TABLE>
<CAPTION>
OPERATIONS
-------------------------------------------------------------------------------
<S> <C> <C>
11/1/99 - 10/31/00 11/1/98 - 10/31/99
Net investment income $6,368 $2,830
Net realized gains or losses 200,969 (5,689)
Net unrealized gains + 562 135,451
-----------------------------------
INCREASE IN NET ASSETS FROM OPERATIONS 207,899 132,592
DISTRIBUTIONS PAID
-------------------------------------------------------------------------------
DIVIDENDS FROM NET INVESTMENT INCOME
Investor Shares 1,061 1,755
Select Shares(R) + 1,847 752
-----------------------------------
TOTAL DIVIDENDS FROM NET INVESTMENT INCOME 2,908 2,507 a
DISTRIBUTIONS FROM NET REALIZED GAINS
Investor Shares -- 27,699
Select Shares + -- 8,884
-----------------------------------
TOTAL DISTRIBUTIONS FROM NET REALIZED GAINS $ -- $36,583
</TABLE>
<TABLE>
<CAPTION>
TRANSACTIONS IN FUND SHARES
-------------------------------------------------------------------------------
11/1/99 - 10/31/00 11/1/98 - 10/31/99
QUANTITY VALUE QUANTITY VALUE
<S> <C> <C> <C> <C>
Shares sold:
Investor Shares 20,058 $409,420 15,020 $244,144
Select Shares + 16,696 340,046 22,187 364,275
---------------------------------------------
TOTAL SHARES SOLD 36,754 $749,466 37,207 $608,419
Shares reinvested:
Investor Shares 52 $983 1,826 $27,893
Select Shares + 91 1,722 552 8,447
---------------------------------------------
TOTAL SHARES REINVESTED 143 $2,705 2,378 $36,340
Shares redeemed:
Investor Shares 7,938 $161,380 22,026 $358,017
Select Shares + 6,528 134,911 6,829 110,483
---------------------------------------------
TOTAL SHARES REDEEMED 14,466 $296,291 28,855 $468,500 b
NET INCREASE 22,431 $455,880 10,730 $176,259 c
</TABLE>
<TABLE>
<CAPTION>
SHARES OUTSTANDING AND NET ASSETS
-------------------------------------------------------------------------------
11/1/99 - 10/31/00 11/1/98 - 10/31/99
SHARES NET ASSETS SHARES NET ASSETS
<S> <C> <C> <C> <C>
Beginning of period 51,593 $899,017 40,863 $629,256
Total increase + 22,431 660,871 10,730 269,761 d
--------------------------------------------------------
END OF PERIOD 74,024 $1,559,888 51,593 $899,017 e
</TABLE>
a UNAUDITED
For corporations, 100% of the fund's dividends for the report period qualify
for the dividends-received deduction.
b Dollar amounts are net of proceeds received from early withdrawal fees that
the fund charges on shares sold 180 days or less after buying them:
<TABLE>
<S> <C>
CURRENT PERIOD
Investor Shares $155
Select Shares + 91
-----------
Total $246
PRIOR PERIOD
Investor Shares $232
Select Shares + 176
-----------
Total $408
</TABLE>
c Represents shares sold plus shares reinvested, minus shares redeemed.
d Figures for shares represent the net changes in shares from the transactions
described above. Figures for net assets represent the changes in net assets
from operations plus the value of transactions in fund shares, minus
distributions paid.
e Includes net investment income not yet distributed in the amount of $5,666 for
the current period and $2,205 for the prior period.
Percent of fund shares owned by other SchwabFunds(R) as of the end of the
current period:
<TABLE>
<S> <C>
SCHWAB MARKETTRACK PORTFOLIOS(R)
All Equity Portfolio 7.1%
Growth Portfolio 7.4%
Balanced Portfolio 5.0%
Conservative Portfolio 1.3%
SCHWAB ANNUITY PORTFOLIOS
Growth Portfolio II 0.3%
</TABLE>
68 See the Financial Notes, which
are integral to this information.
<PAGE> 73
SCHWAB
TOTAL STOCK MARKET INDEX FUND(TM)
[PICTURE OF GERI HOM AND LARRY MANO]
"Both share classes of the fund posted positive total returns for the period,
and even slightly outpaced the Wilshire 5000 Total Market Index, the fund's
unmanaged benchmark."
Portfolio Manager
Geri Hom
GERI HOM, a vice president of the investment adviser, has overall
responsibility for the management of the fund. Prior to joining the firm in
1995, she worked for nearly 15 years in equity index management.
LARRY MANO, a portfolio manager, is responsible for the day-to-day management
of the fund. Prior to joining the firm in 1998, he worked for 20 years in
equity index management.
TICKER SYMBOLS
INVESTOR SHARES SWTIX
SELECT SHARES(R) SWTSX
_______________________________________________________________________________
[INVESTMENT STYLE 1 & MARKET CAP 1 GRAPHIC]
<TABLE>
<S> <C> <C>
VALUE BLEND GROWTH
X LARGE
MEDIUM
SMALL
</TABLE>
With its very broad exposure to the U.S. stock market, this fund is designed for
long-term investors who want exposure to all three tiers of the market: large-,
mid- and small-cap.
_______________________________________________________________________________
THE FUND SEEKS TO TRACK THE TOTAL RETURN OF THE ENTIRE U.S. STOCK MARKET, AS
MEASURED BY THE WILSHIRE 5000 TOTAL MARKET INDEX. 2
MANAGER'S PERSPECTIVE
GIVEN THE VOLATILITY THAT PREVAILED IN EQUITY MARKETS, THE FUND PERFORMED
COMPARATIVELY WELL DURING THE REPORT PERIOD. A combination of factors caused
investors to trim their overall exposure to stocks. Among these factors were
high stock prices, uncertainty over the outcome of the presidential election and
potential interest rate hikes. Toward the end of the report period, evidence of
a slowing economy reduced fears of interest rate hikes. Ordinarily this might
have helped the market regain its footing, but concerns about high oil prices
kept stocks in flux.
SMALL-CAP STOCKS CONTRIBUTED THE MOST TO THE FUND'S PERFORMANCE FOR THE REPORT
PERIOD. Large-cap stocks relinquished their five-year hold as the strongest
performing asset class, outpaced by small-cap stocks--the leading asset class
for the report period--and mid-caps. Initially, the fund's small-cap growth
stocks outperformed their value counterparts. This trend reversed in the second
half of the period as investors reduced their exposure to technology and
internet issues.
Sectors that helped boost the fund's performance for the report period included
utilities, capital goods, health care and financial services.
1 Source: Morningstar, Inc. This style assessment is the result of comparing
the fund with the S&P 500(R) Index, based on P/E, P/B and median market cap.
The assessment reflects the fund's portfolio as of 10/31/00, which may have
changed since then, and is not a precise indication of risk or performance--
past, present or future.
2 Wilshire and Wilshire 5000 are registered service marks of Wilshire
Associates, Inc. The fund is not sponsored, endorsed, sold or promoted by
Wilshire Associates, and Wilshire Associates is not in any way affiliated
with the fund. Wilshire Associates makes no representation regarding the
advisability of investing in the fund or in any stock included in the
Wilshire 5000.
69
<PAGE> 74
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM)
PERFORMANCE: INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Investor Shares with the Wilshire
5000 Total Market Index and the Morningstar Large-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 6/1/99
------------------------- -------------------------
0.13% (0.05%)
--------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 8.23% 8.10% 8.70% 1 8.90% 8.95% n/a
% of Return Lost to Taxes 2.31% - 19.77% 1 n/a - n/a
AFTER-TAX RETURN 2 8.04% - 6.98% 1 n/a - n/a
</TABLE>
PERFORMANCE OF A $10,000 INVESTMENT
Shows performance since inception of a hypothetical $10,000 investment in the
fund's Investor Shares, compared to a similar investment in the Wilshire 5000
Total Market Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
INVESTOR WILSHIRE
SHARES 5000 TOTAL
MARKET INDEX
<S> <C> <C>
6/1/99 10000 10000
6/30/99 10515 10518
7/31/99 10165 10180
8/31/99 10070 10086
9/30/99 9820 9822
10/31/99 10435 10447
11/30/99 10790 10797
12/31/99 11605 11617
1/31/00 11108 11135
2/29/00 11374 11384
3/31/00 12022 12060
4/30/00 11399 11432
5/31/00 11012 11033
6/30/00 11484 11519
7/31/00 11258 11286
8/31/00 12077 12105
9/30/00 11520 11548
10/31/00 11294 11303
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category that had track records of at least one year. These
funds may or may not use tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
70
<PAGE> 75
PERFORMANCE: SELECT SHARES(R)
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Select Shares with the Wilshire
5000 Total Market Index and the Morningstar Large-Cap Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 6/1/99
------------------------- -----------------------
0.20% 0.07%
---------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 8.30% 8.10% 8.70% 1 9.02% 8.95% n/a
% of Return Lost to Taxes 2.41% - 19.77% 1 n/a - n/a
AFTER-TAX RETURN 2 8.10% - 6.98% 1 n/a - n/a
</TABLE>
PERFORMANCE OF A $50,000 INVESTMENT
Shows performance since inception of a hypothetical $50,000 investment in the
fund's Select Shares, compared to a similar investment in the Wilshire 5000
Total Market Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
SELECT WILSHIRE
SHARES 5000 TOTAL MARKET INDEX
<S> <C> <C>
6/1/99 50000 50000
6/30/99 52600 52590
7/31/99 50850 50902
8/31/99 50350 50428
9/30/99 49125 49112
10/31/99 52225 52236
11/30/99 53975 53986
12/31/99 58065 58083
1/31/00 55605 55673
2/29/00 56935 56920
3/31/00 60150 60301
4/30/00 57060 57159
5/31/00 55130 55164
6/30/00 57515 57597
7/31/00 56385 56428
8/31/00 60480 60524
9/30/00 57715 57740
10/31/00 56560 56516
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category that had track records of at least one year. These
funds may or may not use tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
71
<PAGE> 76
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM)
FUND FACTS
TOP TEN HOLDINGS 1 as of 10/31/00
<TABLE>
<S> <C>
1 GENERAL ELECTRIC CO. 3.4%
2 CISCO SYSTEMS, INC. 2.4%
3 MICROSOFT CORP. 2.3%
4 EXXON MOBIL CORP. 1.9%
5 INTEL CORP. 1.9%
6 PFIZER, INC. 1.7%
7 CITIGROUP, INC. 1.5%
8 AMERICAN INTERNATIONAL GROUP, INC. 1.4%
9 MERCK & CO., INC. 1.3%
10 WAL-MART STORES, INC. 1.3%
----------------------------------------------------
TOTAL PERCENTAGE OF INVESTMENTS 19.1%
</TABLE>
STATISTICS as of 10/31/00
<TABLE>
<CAPTION>
PEER GROUP
FUND AVERAGE 2
-------------------------------------------------------------------------------
<S> <C> <C>
Number of Holdings 2948 137
-------------------------------------------------------------------------------
Median Market Cap ($ Mil) $49,887 $56,749
-------------------------------------------------------------------------------
Price/Earnings (P/E) Ratio 34.0 34.3
-------------------------------------------------------------------------------
Price/Book (P/B) Ratio 8.8 8.7
-------------------------------------------------------------------------------
12-Month Yield Investor Shares 0.43% 0.45%
-------------------------------------------------------------------------------
Portfolio Turnover Rate 2% 98%
-------------------------------------------------------------------------------
Three-Year Beta -- --
-------------------------------------------------------------------------------
</TABLE>
EXPENSE RATIO as of 10/31/00
[BAR CHART]
<TABLE>
<CAPTION>
INVESTOR SHARES SELECT SHARES(R) PEER GROUP AVERAGE
--------------------------------------------------------------------------------
<S> <C> <C>
0.40% 3 0.27% 3 1.34% 2
</TABLE>
INDEX COMPOSITION BY INDUSTRY 4
These charts show the size of the ten largest industries in the Wilshire 5000
Total Market Index. As the charts show, the total portion represented by these
industries has been growing over the past five years.
[PIE CHART]
AS OF 10/31/00
---------------------------------------------------
<TABLE>
<S> <C> <C>
1 12.7% Business Machines
2 11.9% Drugs & Medicine
3 9.5% Electronics
4 7.7% Miscellaneous Finance
5 7.6% Business Services
6 5.9% Telephone
7 5.3% Producer Goods
8 5.0% Banks
9 4.6% Retail
10 3.6% Insurance
26.2% Other
</TABLE>
[PIE CHART]
AS OF 10/31/99
---------------------------------------------------
<TABLE>
<S> <C> <C>
1 11.3% Business Machines
2 9.8% Drugs & Medicine
3 8.2% Electronics
4 7.7% Telephone
5 7.1% Business Services
6 7.1% Miscellaneous Finance
7 6.4% Banks
8 6.0% Retail
9 5.0% Producer Goods
10 4.0% Media
27.4% Other
</TABLE>
[PIE CHART]
AS OF 10/31/95
---------------------------------------------------
<TABLE>
<S> <C> <C>
1 9.8% Drugs & Medicine
2 7.2% Telephone
3 7.0% Banks
4 6.5% Electronics
5 5.5% Business Machines
6 5.3% Food & Agriculture
7 5.2% Miscellaneous Finance
8 5.2% Energy & Utilities
9 4.9% Producer Goods
10 4.4% Retail
38.9% Other
</TABLE>
1 This list is not a recommendation of any security by the investment adviser.
Portfolio holdings may have changed since the report date.
2 Source: Morningstar, Inc. As of 10/31/00, there were 2,620 funds in the
Large-Cap Fund category.
3 Guaranteed by Schwab and the investment adviser through 2/28/01. The actual
expense ratio during the report period was 0.01% higher due to certain
non-routine expenses.
4 Source: Wilshire Associates, Inc.
72
<PAGE> 77
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
FINANCIAL TABLES
These pages provide additional data on the fund's performance, portfolio
holdings, expenses and business operations. These figures have been audited by
PricewaterhouseCoopers LLP.
Two other sections of this report provide context for the data in these
financials. THE FINANCIAL NOTES section contains information about the fund's
business structure, accounting practices and other matters, completing the data
given in these tables. The final section, HOW TO READ THIS REPORT, includes
guides designed to make the financials easy to read and understand.
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
11/1/99- 6/1/99 1-
INVESTOR SHARES 10/31/00 10/31/99
<S> <C> <C>
PER-SHARE DATA ($)
--------------------------------------------------------------------------------
Net asset value at beginning of period 20.87 20.00
--------------------
Income from investment operations:
Net investment income 0.16 0.07
Net realized and unrealized gains 1.56 0.80
--------------------
Total income from investment operations 1.72 0.87
Less distributions:
Dividends from net investment income (0.10) --
--------------------
Net asset value at end of period 22.49 20.87
====================
Total return (%) 8.23 4.35 2
RATIOS/SUPPLEMENTAL DATA (%)
--------------------------------------------------------------------------------
Ratio of net operating expenses to
average net assets 0.40 4 0.40 3
Expense reductions reflected in above ratio 0.26 0.51 3
Ratio of net investment income to
average net assets 0.76 0.92 3
Portfolio turnover rate 2 1
Net assets, end of period ($ x 1,000,000) 218 136
</TABLE>
1 Commencement of operations.
2 Not annualized.
3 Annualized.
4 Would have been 0.41% if certain non-routine expenses (proxy fees) had been
included.
See the Financial Notes, which 73
are integral to this information.
<PAGE> 78
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
<TABLE>
<CAPTION>
11/1/99- 6/1/99 1-
SELECT SHARES(R) 10/31/00 10/31/99
<S> <C> <C>
PER-SHARE DATA ($)
--------------------------------------------------------------------------------
Net asset value at beginning of period 20.89 20.00
--------------------
Income from investment operations:
Net investment income 0.17 0.07
Net realized and unrealized gains 1.56 0.82
--------------------
Total income from investment operations 1.73 0.89
Less distributions:
Dividends from net investment income (0.10) --
--------------------
Net asset value at end of period 22.52 20.89
====================
Total return (%) 8.30 4.45 2
RATIOS/SUPPLEMENTAL DATA (%)
--------------------------------------------------------------------------------
Ratio of net operating expenses
to average net assets 0.27 4 0.27 3
Expense reductions reflected in above ratio 0.24 0.47 3
Ratio of net investment income to
average net assets 0.89 1.05 3
Portfolio turnover rate 2 1
Net assets, end of period ($ x 1,000,000) 262 149
</TABLE>
1 Commencement of operations.
2 Not annualized.
3 Annualized.
4 Would have been 0.28% if certain non-routine expenses (proxy fees) had been
included.
74 See the Financial Notes, which
are integral to this information.
<PAGE> 79
PORTFOLIO HOLDINGS
As of October 31, 2000
This section shows all the securities in the fund's portfolio and their market
value, as of the report date.
We use the symbols below to designate certain characteristics. With the top ten
holdings, the number in the circle is the security's rank among the top ten.
(1) Top ten holding
+ New holding (since 10/31/99)
- Non-income producing security
* American Depositary Receipt
# Collateral for open futures contracts
## Issuer is affiliated with the fund's adviser
The pie chart below shows the fund's major asset categories and the market value
and cost of the securities in each category.
ALL DOLLAR VALUES ARE IN THOUSANDS. [PIE CHART]
<TABLE>
<C> <S>
99.0% COMMON STOCK
Market Value: $475,813
Cost: $445,263
1.0% OTHER INVESTMENT COMPANIES
Market Value: $4,717
Cost:$4,717
0.0% U.S. TREASURY OBLIGATIONS
Market Value: $243
Cost: $243
--------------------------------------------------------
100.0% TOTAL INVESTMENTS
Market Value: $480,773
Cost: $450,223
</TABLE>
COMMON STOCK 99.0% of investments
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
AEROSPACE / DEFENSE 1.1%
-------------------------------------------------------------------------
<S> <C>
- Aviation Sales Co. 800 2
B.F. Goodrich Co. 2,904 119
Boeing Co. 26,500 1,797
Crane Co. 1,600 42
GenCorp., Inc. 1,700 14
General Dynamics Corp. 6,500 465
Kaman Corp., Class A 1,000 14
- Litton Industries, Inc. 1,100 57
Lockheed Martin Corp. 12,952 464
Northrop Grumman Corp. 2,479 208
Raytheon Co., Class B 11,200 383
Rockwell International Corp. 5,800 228
- Satcon Technology Corp. 1,000 25
- Sequa Corp., Class A 300 11
Textron, Inc. 5,300 267
- Trimble Navigation Ltd. 1,000 24
TRW, Inc. 3,600 151
United Technologies Corp. 13,734 959
- Veeco Instruments, Inc. 400 26
------
5,256
AIR TRANSPORTATION 0.4%
-------------------------------------------------------------------------
AAR Corp. 700 8
Airborne Freight Corp. 1,100 11
- AirTran Holdings, Inc. 1,000 4
Alaska Air Group, Inc. 600 16
- America West Holdings Corp., Class B 1,100 11
- AMR Corp. 4,900 160
- Amtran, Inc. 600 9
- Atlantic Coast Airlines Holdings, Inc. 800 29
- Atlas Air, Inc. 1,300 47
- Aviall, Inc. 1,200 8
- Continental Airlines, Inc., Class B 2,000 105
Delta Air Lines, Inc. 3,600 170
- EGL, Inc. 2,150 61
- FedEx Corp. 9,500 445
- Frontier Airlines, Inc. 600 14
Galileo International, Inc. 2,500 49
- Hawk Corp., Class A 1,200 7
- Kellstrom Industries, Inc. 600 2
- Mesa Air Group, Inc. 1,300 8
- Mesaba Holdings, Inc. 1,100 12
- Midwest Express Holdings, Inc. 500 9
- Northwest Airlines Corp., Class A 2,300 66
SkyWest, Inc. 700 35
Southwest Airlines Co. 15,250 435
- U.S. Airways Group, Inc. 1,900 72
UAL Corp. 1,400 53
------
1,846
</TABLE>
See the Financial Notes, which 75
are integral to this information.
<PAGE> 80
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
ALCOHOLIC BEVERAGES 0.3%
-------------------------------------------------------------------------
Adolph Coors Co., Class B 1,100 70
Anheuser-Busch Cos., Inc. 26,900 1,231
- Boston Beer Co., Inc., Class A 300 2
Brown-Forman Corp., Class B 2,200 134
- The Chalone Wine Group Ltd. 200 2
- Constellation Brands, Inc., Class A 500 24
Genesee Corp., Class B 200 7
National Beverage Corp. 1,200 9
- The Robert Mondavi Corp., Class A 400 18
-----
1,497
APPAREL 0.3%
-------------------------------------------------------------------------
- Abercrombie & Fitch Co., Class A 2,900 68
- Bebe Stores, Inc. 900 14
Brown Shoe Co., Inc. 800 8
- The Buckle, Inc. 1,000 17
- The Children's Place Retail Stores, Inc. 1,100 29
- Columbia Sportswear Co. 900 38
- The Dress Barn, Inc. 800 20
- Footstar, Inc. 600 22
- Genesco, Inc. 1,300 23
- Global Sports, Inc. 800 7
- Guess?, Inc. 1,700 13
Haggar Corp. 1,200 16
J. Baker, Inc. 1,100 4
- Jo-Ann Stores, Inc., Class A 700 5
- Jones Apparel Group, Inc. 3,800 106
K-Swiss, Inc., Class A 600 16
Kellwood Co. 900 17
- Kenneth Cole Productions, Inc., Class A 600 27
Liz Claiborne, Inc. 1,600 68
-+ Matrixone, Inc. 1,200 36
- The Men's Wearhouse, Inc. 1,200 35
- Nautica Enterprises, Inc. 1,300 16
Nike, Inc., Class B 8,100 323
Oshkosh B'Gosh, Inc., Class A 700 11
- Pacific Sunwear of California 1,100 23
- Polo Ralph Lauren Corp. 1,000 20
Polymer Group, Inc. 1,300 8
- Quiksilver, Inc. 1,000 19
- Reebok International Ltd. 1,700 37
Russell Corp. 1,100 18
- Saucony, Inc., Class B 700 8
Springs Industries, Inc., Class A 600 14
Stride Rite Corp. 2,100 11
Superior Uniform Group, Inc. 900 7
Talbots, Inc. 1,000 79
- Tarrant Apparel Group 800 5
- Timberland Co., Class A 1,200 62
- Tropical Sportswear International Corp. 500 8
- Unifi, Inc. 1,900 17
- Urban Outfitters, Inc. 1,100 10
VF Corp. 3,900 107
WestPoint Stevens, Inc. 1,600 11
Wolverine World Wide, Inc. 1,200 13
-----
1,416
AUTOMOTIVE PRODUCTS / MOTOR VEHICLES 1.2%
-------------------------------------------------------------------------
A.O. Smith Corp., Class B 800 11
- American Axle & Manufacturing Holdings, Inc. 1,100 14
ArvinMeritor, Inc. 1,800 30
- ASV, Inc. 700 10
Bandag, Inc. 700 25
Borg Warner, Inc. 800 30
Carlisle Cos., Inc. 900 37
- Collins & Aikman Corp. 1,300 6
Cooper Tire & Rubber Co. 2,400 26
Copart, Inc. 1,400 21
Cummins Engine Co., Inc. 1,400 48
Dana Corp. 4,500 100
Danaher Corp. 4,300 271
Delphi Automotive Systems Corp. 16,700 262
- Delco Remy International, Inc. 1,200 8
Donaldson Co., Inc. 1,100 25
- Dura Automotive Systems, Inc. 600 5
Eaton Corp. 3,600 245
Exide Corp. 1,700 17
Fleetwood Enterprises, Inc. 1,000 13
-+ Florida East Coast Industries, Class B 554 19
Ford Motor Co. 61,286 1,601
General Motors Corp. 14,686 912
</TABLE>
76 See the Financial Notes, which
are integral to this information.
<PAGE> 81
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- General Motors Corp., Class H 24,882 806
Genuine Parts Co. 5,200 111
Goodyear Tire & Rubber Co. 4,500 83
- Group 1 Automotive, Inc. 1,100 11
Harley-Davidson, Inc. 8,800 424
- Hayes Lemmerz International, Inc. 700 8
- Lear Corp. 1,800 49
Midas, Inc. 500 7
Modine Manufacturing Co. 600 16
- Monaco Coach Corp. 500 9
Myers Industries, Inc. 770 10
- Navistar International Corp. 1,600 53
- O'Reilly Automotive, Inc. 1,200 22
Oshkosh Truck Corp. 450 19
Polaris Industries, Inc. 600 21
- Rush Enterprises, Inc. 500 2
Simpson Industries, Inc. 1,000 12
- SPX Corp. 800 99
Standard Motor Products, Inc. 700 6
- Sterile Recoveries, Inc. 300 4
- Stoneridge, Inc. 1,200 12
Superior Industries International, Inc. 1,300 44
- TBC Corp. 1,500 7
Thor Industries, Inc. 500 10
Titan International, Inc. 800 4
- Tower Automotive, Inc. 2,300 25
- United Rentals, Inc. 2,100 45
+ Visteon Corp. 4,451 79
Winnebago Industries, Inc. 700 8
------
5,742
BANKS 5.1%
-------------------------------------------------------------------------
ABC Bancorp. 1,200 11
Albama National Bancorp. 400 8
AmSouth Bancorp. 15,403 215
Anchor Bancorp. Wisconsin, Inc. 800 12
Associated BancoCorp. 1,760 42
BancFirst Corp. 500 18
BancFirst Ohio Corp. 735 12
Bancorpsouth, Inc. 2,312 30
BancWest Corp. 1,600 33
Bank of America Corp. 48,500 2,331
Bank of Granite Corp. 400 9
Bank of New York Co., Inc. 21,700 1,249
Bank One Corp. 34,000 1,241
Bank United Corp., Class A 800 45
BankFirst Corp. 1,500 21
Banknorth Group, Inc. 3,512 64
BB&T Corp. 12,879 411
Berkshire Bancorp, Inc. 500 15
Brenton Banks, Inc. 200 2
Brookline Bancorp., Inc. 1,400 15
BSB Bancorp., Inc. 200 3
Capital City Bank Group, Inc. 500 10
Capitol Bancorp. Ltd. 700 8
Capitol Federal Financial 2,300 33
Cascade Bancorp. 880 11
CENIT Bancorp., Inc. 500 8
- Centennial Bancorp. 952 7
- Central Coast Bancorp. 880 16
Centura Banks, Inc. 1,070 41
Century South Banks, Inc. 400 7
Chase Manhattan Corp. 39,200 1,784
Chemical Financial Corp. 420 9
Chittenden Corp. 600 16
Citizens Banking Corp. 990 24
City Holding Co. 800 5
City National Corp. 1,100 38
The Colonial BancGroup, Inc. 2,500 22
- Columbia Banking System, Inc. 1,210 17
Comerica, Inc. 5,900 356
Commerce Bancorp., Inc. N.J. 830 50
Commerce Bancshares, Inc. 1,565 56
Community Bank System, Inc. 500 12
Community First Bankshares, Inc. 1,200 19
Community Trust Bancorp. 660 10
Compass Bancshares, Inc. 3,200 58
Corus Bankshares, Inc. 500 20
Cullen/Frost Bankers, Inc. 1,200 40
Dime Community Bancshares 500 11
Doral Financial Corp. 1,100 20
Drovers Bancshares Corp. Pa. 630 9
Eagle Bancshares, Inc. 700 8
-+ Exelixis, Inc. 1,200 26
F&M Bancorp./Frederick MD 200 4
</TABLE>
See the Financial Notes, which 77
are integral to this information.
<PAGE> 82
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
F&M National Corp. 612 16
F.N.B. Corp. 525 11
Farmers Capital Bank Corp. 400 14
Fifth Third Bancorp. 13,766 707
First Bancorp./Puerto Rico 700 16
First Busey Corp., Class A 600 11
First Charter Corp. 1,000 15
First Citizens Bancshares, Class A 300 22
First Commonwealth Financial Corp. 1,300 13
First Federal Capital Corp. 700 8
First Federal Financial Corp. of Kentucky 600 9
First Financial Bancorp. 990 15
First Financial Bancshares, Inc. 400 12
First Merchants Corp. 400 9
First Midwest Bancorp., Inc. 900 23
First Niagara Financial Group 1,200 11
- First Republic Bank 400 11
First Tennessee National Corp. 3,300 76
First Union Corp. 28,962 878
First United Corp. 900 9
First Virginia Banks, Inc. 1,700 70
Firstar Corp. 28,154 554
Firstfed America Bancorp., Inc. 1,000 15
- Firstfed Financial Corp. 900 23
FirstMerit Corp. 2,100 48
FleetBoston Financial Corp. 26,514 1,008
Frontier Financial Corp. 700 13
Fulton Financial Corp. 1,680 37
GA Financial, Inc. 800 11
GBC Bancorp. 400 13
Golden West Financial Corp. 7,400 415
Great Southern Bancorp. 500 8
GreenPoint Financial Corp. 3,100 92
Hancock Holding Co. 300 9
Harbor Florida Bancshares, Inc. 1,100 13
Harleysville National Corp. 420 13
Hibernia Corp., Class A 4,200 50
Horizon Financial Corp. 1,100 10
Hudson City Bancorp., Inc. 2,700 49
Hudson United Bancorp. 1,219 27
Huntington Bancshares, Inc. 9,290 134
- Imperial Bancorp. 1,080 26
Independence Community Bank 1,700 25
Industrial Bancorp., Inc. 500 6
Integra Bank Corp. 525 14
Irwin Financial Corp. 700 11
J.P. Morgan & Co., Inc. 4,900 811
KeyCorp, Inc. 15,100 373
Lakeland Financial Corp. 800 9
LSB Bancshares, Inc. 500 7
M&T Bank Corp. 2,371 119
MAF Bancorp., Inc. 700 17
Marshall & Ilsley Corp. 3,200 145
Mellon Financial Corp. 14,400 695
Mercantile Bankshares Corp. 1,700 64
Merchants Bancshares, Inc. 500 12
Merchants New York Bancorp., Inc. 800 17
Mid-America Bancorp. 406 10
Mid-State Bancshares 500 15
- National City Bancorp. 700 11
National City Corp. 18,100 387
National Commerce Bancorp. 6,050 129
National Penn Bancshares, Inc. 620 13
- Net.B@nk, Inc. 900 8
North Fork Bancorp., Inc. 6,100 123
Northern Trust Corp. 6,600 563
OceanFirst Financial Corp. 400 8
Old Kent Financial Corp. 6,917 192
Old National Bancorp. 1,548 46
Omega Financial Corp. 500 14
Oriental Financial Group 500 6
Pacific Century Financial Corp. 2,100 27
Pacific Northwest Bancorp. 700 9
Park National Corp. 305 29
Peoples Bank-Bridgeport 1,500 30
PFF Bancorp., Inc. 600 11
PNC Financial Services Group 8,600 575
Popular, Inc. 4,000 111
Premier National Bancorp., Inc. 620 13
Provident Bankshares Corp. 840 16
Provident Financial Group, Inc. 1,200 36
Providian Financial Corp. 4,200 437
- Quaker City Bancorp., Inc. 500 9
Queens County Bancorp., Inc. 600 17
Regions Financial Corp. 8,700 205
Republic Bancorp. 1,390 13
</TABLE>
78 See the Financial Notes, which
are integral to this information.
<PAGE> 83
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Republic Bancorp., Inc., Class A 1,600 10
Republic Security Financial Corp. 500 3
Richmond County Financial Corp. 600 14
Riggs National Corp., Washington, D.C. 1,000 11
Roslyn Bancorp., Inc. 1,800 39
S & T Bancorp., Inc. 500 9
- S1 Corp. 1,530 18
Sandy Spring Bancorp., Inc. 200 4
Seacoast Banking Corp. Florida 600 15
Second Bancorp., Inc. 400 6
- Silicon Valley Bancshares 2,200 102
Sky Financial Group, Inc. 1,991 33
South Alabama Bancorp. 400 3
The South Financial Group, Inc. 800 8
Southside Bancshares Corp. 500 4
SouthTrust Corp. 7,300 236
- Southwest Bancorp. of Texas, Inc. 700 26
Southwest Bancorp., Inc. 400 6
State Street Corp. 5,200 649
Sterling Bancorp. 840 16
Sterling Bancshares, Inc. 1,400 24
Sterling Financial Corp. 500 9
Summit Bancorp. 6,337 238
SunTrust Banks, Inc. 9,500 464
Susquehanna Bancshares, Inc. 1,000 14
Synovus Financial Corp. 10,300 222
Texas Regional Bancshares, Inc., Class A 400 12
The Trust Co. of New Jersey 500 7
Trustco Bank Corp. 1,150 14
Trustmark Corp. 1,800 34
U.S. Bancorp. 21,965 531
UMB Financial Corp. 550 19
Union Planters Corp. 5,300 179
UnionBanCal Corp. 4,700 99
United Bankshares, Inc. 1,000 19
United Community Financial Corp. 1,500 10
United National Bancorp. 730 13
USB Holding Co., Inc. 630 8
Valley National Bancorp. 1,551 43
- VIB Corp. 1,591 10
Vista Bancorp., Inc. 840 13
Wachovia Corp. 7,200 389
Washington Trust Bancorp. 700 10
Wells Fargo & Co. 51,976 2,407
Wesbanco, Inc. 500 12
Westamerica Bancorp. 800 29
Westcorp, Inc. 1,080 17
Whitney Holding Corp. 500 18
Wilmington Trust Corp. 900 47
WSFS Financial Corp. 1,000 11
Zions Bancorp. 3,200 184
------
24,772
BUSINESS MACHINES & SOFTWARE 12.6%
-------------------------------------------------------------------------
- 3Com Corp. 10,600 188
- Activision, Inc. 1,000 14
- Adaptec, Inc. 4,400 70
Adobe Systems, Inc. 8,800 669
- Advanced Digital Information Corp. 1,400 18
Analogic Corp. 500 18
- Andersen Group, Inc. 400 4
- Apple Computer, Inc. 10,000 196
- Artesyn Technologies, Inc. 1,100 45
- Auspex Systems, Inc. 1,000 10
Autodesk, Inc. 3,200 71
-+ Avici Systems, Inc. 1,300 56
- Avocent Corp. 1,563 111
- Black Box Corp. 500 33
- BMC Software, Inc. 7,400 150
- Cabletron Systems, Inc. 6,800 184
- Caci International, Inc. Class A 600 12
- CAM Commerce Solutions, Inc. 500 2
- Ceridian Corp. 4,300 107
-(2)Cisco Systems, Inc. 212,719 11,460
- Cognitronics Corp. 600 6
Comdisco, Inc. 4,700 58
- Commerce One, Inc. 5,500 353
Compaq Computer Corp. 51,200 1,557
- Computer Horizons Corp. 1,000 5
- Compuware Corp. 10,400 82
- Comverse Technology, Inc. 5,200 581
- Concurrent Computer Corp. 1,600 28
-+ Crossroads Systems, Inc. 700 5
- Datum, Inc. 1,100 35
-+ Davox Corp. 300 3
- Dell Computer Corp. 77,500 2,286
</TABLE>
See the Financial Notes, which 79
are integral to this information.
<PAGE> 84
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Diebold, Inc. 2,100 55
- Digital Lightwave, Inc. 1,300 66
- EMC Corp. 65,324 5,818
- Equitex, Inc. 1,300 7
- Excalibur Technologies Corp. 1,200 71
-+ Extended Systems, Inc. 200 8
Fair, Isaac & Co., Inc. 300 12
-+ Foundry Networks, Inc. 3,400 226
- Gateway, Inc. 9,600 495
Hewlett-Packard Co. 59,200 2,749
- Hypercom Corp. 1,300 9
-+ Immersion Corp. 500 5
- Informix Corp. 8,150 35
-+ Inprise Corp. 1,200 8
- Input/Output, Inc. 3,400 29
- Integrated Device Technology, Inc. 3,000 169
- Intergraph Corp. 1,000 6
International Business Machines Corp. 52,800 5,201
- InterVoice-Brite, Inc. 1,678 16
-+ Iomega Corp. 3,000 15
- Juniper Networks, Inc. 9,500 1,852
- Latitude Communications, Inc. 400 2
- Lexmark International Group, Inc., Class A 4,200 172
- LTX Corp. 1,400 20
- Maxtor Corp. 3,400 27
- Microchip Technology, Inc. 4,150 131
- Micromuse, Inc. 1,000 170
- Micron Electronics, Inc. 2,800 22
- MICROS Systems, Inc. 500 10
-(3)Microsoft Corp. 157,370 10,839
Minntech Corp. 1,300 9
- MIPS Technology, Inc., Class A 1,100 44
- NCR Corp. 3,700 160
-+ Neose Technologies, Inc. 300 11
-+ Netegrity, Inc. 900 70
Network Appliance, Inc. 9,300 1,107
- Novell, Inc. 9,600 86
Novellus Systems, Inc. 4,500 184
-+ OpenTV Corp. 578 16
Opnet Technologies, Inc. 500 17
- Oracle Corp. 168,600 5,564
+ Osicom Technologies, Inc. 300 10
-+ OTG Software, Inc. 700 22
Pitney Bowes, Inc. 8,300 246
Precise Software Solutions Ltd. 600 14
- Printronix, Inc. 600 5
-+ Procom Technology, Inc. 300 7
- Quantum Corp.--DLT & Storage Systems 4,700 70
- Quantum Corp.--Hard Disk Drive Group 2,400 27
- Read-Rite Corp. 1,900 14
-+ Saba Software, Inc. 1,200 28
- SCM Microsystems, Inc. 400 15
- Seagate Technology, Inc. 7,000 489
*-+ Sema Group PLC 2,210 55
- Sigma Designs, Inc. 1,500 6
- Silicon Graphics, Inc. 4,800 22
-+ Smartdisk Corp. 300 2
-+ Socket Communications, Inc. 300 3
- Storage Technology Corp. 2,600 25
- Sun Microsystems, Inc. 47,640 5,282
- SVI Holdings, Inc. 1,400 6
- Sybase, Inc. 2,600 54
- Systems & Computer Technology Corp. 1,100 16
- Tech Data Corp. 1,600 67
-+ Telxon Corp. 300 7
- The Titan Corp. 1,681 22
Total System Services, Inc. 5,600 92
- Unisys Corp. 9,000 115
Xerox Corp. 19,600 165
- Xircom, Inc. 700 10
------
60,826
BUSINESS SERVICES 8.1%
-------------------------------------------------------------------------
-+ 1-800 Contacts, Inc. 300 12
- 24/7 Media, Inc. 1,100 6
- 4 Kids Entertainment, Inc. 600 9
ABM Industries, Inc. 700 20
- About.com, Inc. 500 12
- Accrue Software, Inc. 800 4
- ACNielsen Corp. 1,700 41
- Actel Corp. 1,100 40
- Actuate Corp. 1,600 45
</TABLE>
80 See the Financial Notes, which
are integral to this information.
<PAGE> 85
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
*+ Adecco SA 127 11
-+ Administaff, Inc. 2,800 99
- Advantage Learning Systems, Inc. 1,100 33
- Advent Software, Inc. 900 54
- Advo, Inc. 700 26
-+ Aether Systems, Inc. 1,100 89
- Affiliated Computer Services, Inc.,
Class A 1,500 84
- Affymetrix, Inc. 1,600 89
-+ Agency.com, Inc. Ltd. 800 8
- Agile Software Corp. 1,400 106
- AHL Services, Inc. 1,500 16
-+ Akamai Technologies, Inc. 438 22
- Allaire Corp. 800 6
- Alliance Semiconductor Corp. 1,200 24
- Allied Waste Industries, Inc. 5,500 51
- America Online, Inc. 69,252 3,492
- American Management Systems,
Inc. 1,200 26
- American Superconductor Corp. 700 33
Analysts International Corp. 1,500 9
- Ansoft Corp. 1,800 18
- Answerthink, Inc. 1,000 16
- Apollo Group, Inc., Class A 2,300 90
-+ Applied Molecular Evolution, Inc. 600 13
-+ Applied Theory Corp. 800 4
-+ Apropos Technology, Inc. 300 2
-+ Arena Pharmaceuticals, Inc. 600 21
- Ariba, Inc. 7,200 910
- Art Technology Group, Inc. 2,000 125
- Ask Jeeves, Inc. 900 12
-+ Aspen Technology, Inc. 700 29
- At Home Corp., Class A 11,600 120
Automatic Data Processing, Inc. 18,800 1,228
- Autonation, Inc. 10,700 72
- Avant! Corp. 1,500 25
- AXENT Technologies, Inc. 1,000 19
- Barra, Inc. 500 31
- BEA Systems, Inc. 7,400 531
- Bell & Howell Co. 700 13
- BindView Development Corp. 1,700 13
-+ Blue Martini Software, Inc. 2,000 75
-+ Bottomline Technologies, Inc. 500 18
Bowne & Co., Inc. 1,200 10
- Brady Corp., Class A 500 15
- Brio Technology, Inc. 900 7
- Broadbase Software, Inc. 2,400 26
- BroadVision, Inc. 7,311 217
Brocade Communications Systems,
Inc. 3,400 773
-+ BSQUARE Corp. 1,100 17
-+ Bull RUN Corp. 1,100 2
-+ Cacheflow, Inc. 1,700 184
-+ CAIS Internet, Inc. 700 3
-+ Career Education Corp. 600 23
- Catalytica, Inc. 1,500 20
- CDI Corp. 700 11
- CDW Computer Centers, Inc. 3,300 213
- Cendant Corp. 21,300 256
-+ Centra Software, Inc. 900 5
- Cerner Corp. 1,000 62
- Cheap Tickets, Inc. 1,400 15
-+ Checkfree Corp. 2,200 109
Chemed Corp. 500 16
- Choicepoint, Inc. 1,167 60
-+ Chordiant Software, Inc. 1,100 7
- Ciber, Inc. 1,900 15
Cintas Corp. 5,050 234
- Citrix Systems, Inc. 5,800 128
- Clarent Corp. 1,545 48
-+ Clarus Corp. 500 5
-+ Click Commerce, Inc. 1,100 31
- Closure Medical Corp. 900 22
- Coinstar, Inc. 1,100 15
- Com21, Inc. 800 9
- Complete Business Solutions, Inc. 1,400 15
- Computer Associates International,
Inc. 17,726 565
- Computer Sciences Corp. 5,538 349
- Concord EFS, Inc. 6,500 269
-*+ Connetics Corp. 900 5
- Convergys Corp. 4,400 192
*+ Cordiant Communications Group
PLC 693 14
-+ Corillian Corp. 800 11
-+ Corio, Inc. 1,400 7
</TABLE>
See the Financial Notes, which 81
are integral to this information.
<PAGE> 86
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) - FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Cornell Cos., Inc. 1,600 8
- Corporate Executive Board Co. 800 37
- Correctional Services Corp. 2,000 7
- CoStar Group, Inc. 600 19
- Credence Systems, Corp. 1,400 26
- Critical Path, Inc. 1,800 87
- CSG Systems International, Inc. 1,500 70
-+ CuraGen Corp. 1,600 103
- CyberSource Corp. 900 5
-+ Cylink Corp. 900 4
-+ Cysive, Inc. 1,000 8
- Cytec Industries, Inc. 1,400 48
-+ Daleen Technologies, Inc. 800 8
-+ Datastream Systems, Inc. 800 10
- Deltek Systems, Inc. 1,200 8
Deluxe Corp. 2,000 45
- Dendrite International, Inc. 1,100 24
- DeVry, Inc. 2,100 78
-+ Digex, Inc. 700 27
- Digital Courier Technologies, Inc. 1,700 5
-+ Digital Insight Corp. 800 15
- Digital River, Inc. 1,000 7
-+ Digitalthink, Inc. 900 32
-+ Digitas, Inc. 1,500 18
-+ Diversa Corp. 400 10
-+ Divine Interventures, Inc., Class A 3,200 10
-+ Documentum, Inc. 500 42
- DoubleClick, Inc. 3,568 58
- DST Systems, Inc. 4,000 246
-+ Dun & Bradstreet Corp. 2,400 52
-+ Dyax Corp. 500 19
- Earthlink, Inc. 3,550 23
- EarthWeb, Inc. 1,000 13
- eBay, Inc. 7,800 402
-+ Ebenx, Inc. 800 10
-+ Echelon Corp. 900 29
- Eclipsys Corp. 1,300 32
Ecolab, Inc. 5,000 196
- Edgewater Technology, Inc. 2,300 11
-+ Edison Schools, Inc. 1,200 33
- Educational Management Corp. 1,000 31
- Egain Communications Corp. 1,000 6
Electronic Data Systems Corp. 14,000 657
-+ Embarcadero Technologies, Inc. 800 48
-+ eMerge Interactive, Inc., Class A 900 10
- Engage, Inc. 4,900 21
- Entrust Technologies, Inc. 1,800 55
-+ ePresence, Inc. 900 6
Equifax, Inc. 4,100 141
-+ Evolve Software, Inc. 1,100 17
-+ eXcelon Corp. 1,400 11
+ Exelon Corp. 10,937 658
-+ Extensity, Inc. 700 9
- Ezenia!, Inc. 1,000 3
- F.Y.I., Inc. 600 24
- F5 Networks, Inc. 600 19
FactSet Research Systems, Inc. 1,000 38
Falcon Products, Inc. 1,500 12
- FileNet Corp. 1,300 34
-+ Firepond, Inc. 1,000 8
First Data Corp. 12,200 612
- Fiserv, Inc. 7,200 378
-+ Flextronics International Ltd. 2,898 110
-+ Forrester Research, Inc. 600 25
-+ Freemarkets, Inc. 1,100 54
G & K Services, Inc., Class A 700 19
- Gartner Group, Inc., Class B 2,251 20
-+ Gemstar -- TV Guide International,
Inc. 12,260 841
-+ Gentiva Health Services 450 5
-+ Genzyme Transgenics Corp. 800 17
-+ Geoworks Corp. 800 4
- Global Imaging Systems, Inc. 2,000 11
-+ Global Sources Ltd. 66 2
- GoTo.com, Inc. 1,300 18
- GP Strategies Corp. 1,500 8
Great American Financial Resources,
Inc. 1,000 18
- Great Plains Software, Inc. 600 23
-+ Gric Communications, Inc. 500 2
- GTECH Holdings, Corp. 900 16
H&R Block, Inc. 4,600 164
- HA-LO Industries, Inc. 2,100 8
*-+ Havas Advertising 2,742 44
-+ Heidrick & Struggles, Inc. 600 37
- HNC Software, Inc. 1,000 20
</TABLE>
82 See the Financial Notes, which
are integral to this information.
<PAGE> 87
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARE ($ x 1,000)
<S> <C>
- Homestore.com, Inc. 2,300 78
-+ Hotel Reservations Network, Inc.,
Class A 400 14
- HotJobs.com Ltd. 1,000 16
- Hyperion Solutions Corp. 800 11
- I2 Technologies, Inc. 5,800 986
-+ Ibasis, Inc. 1,000 8
- Icos Corp. 1,300 67
-+ Identix Inc. 1,100 16
- IDT Corp. 700 25
- IDX Systems Corp. 1,000 32
- iGate Capital Corp. 1,300 7
-+ Impath, Inc. 400 30
IMS Health, Inc. 8,900 210
-+ Infocus Corp. 1,100 49
-+ Infonet Services Corp., Class B 8,800 57
- Information Resource Engineering, Inc. 500 21
-+ infoUSA, Inc. 2,300 7
- Inktomi Corp. 3,400 216
-+ Integrated Silicon Solutions, Inc. 600 8
-+ Interact Commerce Corp. 700 6
- Interliant, Inc. 1,800 11
-+ Intermune Pharmaceuticals, Inc. 600 30
-+ Internap Network Services Corp. 4,200 67
- internet.com Corp. 800 17
Interpublic Group of Cos., Inc. 9,350 401
-+ Intertrust Technologies Corp. 2,200 22
-+ Interwoven, Inc. 1,500 151
- Intuit, Inc. 6,115 376
- Invitrogen Corp. 1,429 109
-+ Iron Mountain, Inc. 1,650 56
- IT Group, Inc. 1,900 8
- J.D. Edwards & Co. 3,100 80
Jack Henry & Associates, Inc. 1,200 66
- Jacobs Engineering Group, Inc. 800 33
-+ JDA Software Group, Inc. 1,000 15
John H. Harland Co. 1,000 14
- Jupiter Media Metrix, Inc. 1,073 15
- Kana Communications, Inc. 2,764 65
- Keane, Inc. 1,900 25
Kelly Services, Inc., Class A 900 20
-+ Key3Media Group, Inc. 1,900 18
- Korn/Ferry International 1,100 38
- Kroll-O'Gara Co. 1,900 11
- Kronos, Inc. 500 18
- Lamar Advertising Co. 2,200 106
LandAmerica Financial Group, Inc. 800 24
-+ Learning Tree International, Inc. 700 32
- Legato Systems, Inc. 2,200 20
- Liberate Technologies 2,600 50
-+ Liberty Satellite & Technology, Inc.,
Class A 1,900 9
-+ LifeMinders, Inc. 800 9
-+ Lightpath Technologies, Inc., Class A 600 16
- Looksmart Ltd. 2,400 17
-+ Loudeye Technologies, Inc. 1,300 5
-+ Luminex Corp. 800 22
- Macrovision Corp. 1,200 87
-+ Manhattan Associates, Inc. 800 51
Manpower, Inc. 2,200 77
-+ Manugistics Group, Inc. 900 103
- Mapinfo Corp. 1,125 37
- MarchFirst, Inc. 4,116 24
- Marimba, Inc. 700 4
- Marketwatch.com, Inc. 400 2
- MAXIMUS, Inc. 700 17
-+ Maxygen, Inc. 1,000 40
- Mechanical Technology, Inc. 1,800 13
- Media Arts Group, Inc. 2,000 10
-+ MedicaLogic/Medscape, Inc. 1,846 7
- MemberWorks, Inc. 500 17
Mentor Corp. 1,000 18
- Mentor Graphics Corp. 1,900 45
-+ Mercury Computer Systems, Inc. 600 19
- Mercury Interactive Corp. 2,400 266
- META Group, Inc. 1,100 11
-+ Metacreations Corp. 1,300 13
-+ Metasolv Software, Inc. 1,000 12
- Metricom, Inc. 900 16
Metris Cos., Inc. 1,700 55
- MicroStrategy, Inc. 700 17
-+ Microvision, Inc. 400 14
-+ MIPS Technologies, Inc., Class B 665 23
- Modis Professional Services, Inc. 2,400 10
- Mpower Communications Corp. 1,650 11
- Multex.com, Inc. 700 9
</TABLE>
See the Financial Notes, which 83
are integral to this information.
<PAGE> 88
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) - FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARE ($ X 1,000)
<S> <C>
National Data Corp. 900 34
- National Instruments Corp. 1,550 72
- National Processing, Inc. 1,500 24
National Service Industries, Inc. 1,800 37
-+ National Wireless Holdings, Inc. 600 10
- NationsRent, Inc. 2,000 4
-+ Natural MicroSystems Corp. 1,000 45
- NCO Group, Inc. 1,061 23
- Neon Systems, Inc. 700 5
- Net Perceptions, Inc. 900 3
-+ Netcentives, Inc. 1,100 8
- NETIQ Corp. 876 75
-+ Netratings, Inc. 900 16
- Netscout Systems, Inc. 1,000 19
-+ Netsolve, Inc. 600 4
- Network Associates, Inc. 3,900 75
-+ Network Engines, Inc. 600 19
- Network Peripherals, Inc. 600 7
- Neurocrine Biosciences, Inc. 1,400 54
New England Business Service, Inc. 800 14
- New Era of Networks, Inc. 1,000 16
+ Nortel Networks Corp. 6,885 313
- NOVA Corp. 2,000 31
-+ NYFIX, Inc. 750 30
-+ Oak Technology, Inc. 1,500 42
- Ogden Corp. 1,600 22
Omnicom Group, Inc. 5,500 507
- On Assignment, Inc. 1,000 25
-+ Oni Systems Corp. 2,600 211
- Onyx Software Corp. 1,400 22
- Open Market, Inc. 1,000 3
-+ Oratec Interventions, Inc. 600 6
- Orbital Sciences Corp. 1,000 8
-+ Organic, Inc. 2,400 8
- Packeteer, Inc. 700 17
- Parametric Technology Corp. 8,000 98
- PAXAR Corp. 1,800 15
Paychex, Inc. 11,000 624
-+ PC-Tel, Inc. 500 9
Pegasus Solutions, Inc. 900 15
- PeopleSoft, Inc. 8,900 388
- Peregrine Systems, Inc. 4,100 98
- Performance Food Group Co. 700 28
- Performance Technologies, Inc. 600 10
- Perot Systems Corp., Class A 2,400 24
- Persistence Software, Inc. 700 8
- Phoenix Technologies Ltd. 800 13
-+ Photon Dynamics, Inc. 400 14
Pittston Brink's Group 1,200 19
-+ Pivotal Corp. 600 37
- Pixar, Inc. 1,400 46
- Polycom, Inc. 3,100 201
+ PolyOne Corp. 1,700 13
- Pomeroy Computer Resources, Inc. 1,100 19
- Portal Software, Inc. 4,900 172
-+ Praecis Pharmaceuticals, Inc. 1,200 30
- Pre-Paid Legal Services, Inc. 500 22
-+ Predictive Systems, Inc. 1,000 14
- Priceline.com, Inc. 4,800 28
-+ Primus Knowledge Solution, Inc. 700 6
- Priority Healthcare Corp., Class B 600 32
- ProBusiness Services, Inc. 700 23
- Prodigy Communictions Corp.,
Class A 1,500 7
- Profit Recovery Group International,
Inc. 1,700 9
- Progress Software Corp. 1,000 16
- Project Software & Development, Inc. 800 10
- Protein Design Labs, Inc. 1,600 216
- Proxicom, Inc. 1,500 20
- Proxim, Inc. 800 48
- PSINet, Inc. 5,382 36
-+ Puma Technology, Inc. 1,000 14
- PurchasePro.com, Inc. 1,900 51
- Qlogic Corp. 2,722 263
- QRS Corp. 550 5
- Quest Software, Inc. 2,500 109
-+ Quintus Corp. 1,500 11
Quixote Corp. 800 13
- R.H. Donnelley Corp. 1,000 23
-+ Radiant Systems, Inc. 800 15
-+ Radio One, Inc., Class D 1,200 10
- RadiSys Corp. 500 13
- Razorfish, Inc., Class A 2,524 11
- RealNetworks, Inc. 4,500 93
- Red Hat, Inc. 4,400 55
</TABLE>
84 See the Financial Notes, which
are integral to this information.
<PAGE> 89
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Redback Networks, Inc. 4,400 468
- Remedy Corp. 900 15
- RemedyTemp, Inc., Class A 900 8
-+ Resonate, Inc. 800 34
-+ Retek, Inc. 2,643 104
Reynolds & Reynolds Co., Class A 2,000 36
- Robert Half International, Inc. 5,400 165
- RSA Security, Inc. 1,100 64
-+ Rural Cellular Corp., Class A 300 16
- S3, Inc. 2,600 23
- SAGA Systems, Inc. 800 4
- Sanchez Computer Associates, Inc. 800 13
- Sandisk Corp. 2,000 107
-+ Sangamo Biosciences, Inc. 600 16
- Sapient Corp. 3,400 121
-+ Savvis Communications Corp. 2,500 10
- Scient Corp. 2,000 36
- SDL, Inc. 2,200 570
-+ Seachange International, Inc. 550 12
- Seacor Smit, Inc. 750 31
-+ Secure Computing Corp. 700 16
SEI Investments Co. 2,200 200
-+ Sequenom, Inc. 600 19
-+ SeraNova, Inc. 700 3
- Serena Software, Inc. 1,100 56
The ServiceMaster Co. 8,800 80
- Siebel Systems, Inc. 12,400 1,301
-+ SignalSoft Corp. 700 20
- Silver Stream Software, Inc. 500 11
- Sirius Satellite Radio, Inc. 1,200 60
-+ SITEL Corp. 2,800 8
-+ Six Flags, Inc. 2,100 33
- Software.Com, Inc. 1,500 223
-+ Sonic Foundry, Inc. 600 4
-+ SonicWall, Inc. 1,600 24
-+ Sonus Networks, Inc. 600 21
Spartech Corp. 700 11
- SportsLine.com, Inc. 800 7
Standard Register Co. 1,100 13
- StarMedia Network, Inc. 1,700 10
- StarTek, Inc. 600 15
- Stericycle, Inc. 1,100 36
+ Stilwell Financial, Inc. 6,800 305
Strayer Education, Inc. 700 17
- Structural Dynamics Research Corp. 1,400 14
- Sungard Data Systems, Inc. 4,100 210
-+ Sunrise Telecom, Inc. 1,400 35
-+ Sycamore Networks, Inc. 7,300 462
- Sylvan Learning Systems, Inc. 900 14
- Symantec Corp. 1,700 66
-+ Symyx Technologies, Inc. 800 38
- Synopsys, Inc. 2,100 73
- Syntel, Inc. 1,500 14
- Tanning Technology Corp. 900 5
-+ Teledyne Technologies, Inc. 1,857 47
- Teletech Holdings, Inc. 1,800 50
- Tetra Tech, Inc. 1,125 39
-+ Thermo Cardiosystems, Inc. 1,600 13
- TIBCO Software, Inc. 5,700 359
-+ Ticketmaster Online--CitySearch, Inc.,
Class B 900 14
- TMP Worldwide, Inc. 2,800 195
- Transaction Systems Architects, Inc.,
Class A 1,200 16
True North Communications, Inc. 1,400 53
-+ Tularik, Inc. 1,300 41
Tyco International Ltd. 2,376 135
-+ Unify Corp. 1,200 1
- Universal Electronics, Inc. 1,000 18
- UNOVA, Inc. 1,300 6
- URS Corp. 1,200 15
-+ Va Linux Systems, Inc. 1,427 42
- Ventiv Health, Inc. 1,633 18
- Ventro Corp. 1,200 6
- VeriSign, Inc. 5,780 763
- VERITAS Software Corp. 12,075 1,703
- Verity, Inc. 1,100 26
-+ Vertel Corp. 900 5
- VerticalNet, Inc. 2,300 64
-+ Via Net.Works, Inc. 2,700 20
Viad Corp. 2,600 56
-+ The viaLink Co. 700 5
- Viant Corp. 1,300 8
- Vignette Corp. 6,848 204
- Vitesse Semiconductor Corp. 5,600 392
-+ Vixel Corp. 600 3
</TABLE>
See the Financial Notes, which 85
are integral to this information.
<PAGE> 90
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) - FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
-+ Vyyo, Inc. 1,000 22
WABTEC 1,528 15
The Wackenhut Corp., Class A 1,000 13
- Wackenhut Corrections Corp. 1,500 11
Wallace Computer Services, Inc. 1,500 22
- Washington Group International, Inc. 1,500 16
Waste Management, Inc. 19,100 382
-+ WatchGuard Technologies, Inc. 600 30
- Wave Systems Corp., Class A 1,200 14
-+ Waypoint Financial Corp. 1,073 10
-+ Webmethods, Inc. 1,421 126
-+ Websense, Inc. 700 13
- WebTrends Corp. 700 22
- Westaff, Inc. 2,000 6
- Wind River Systems, Inc. 2,160 89
-+ Wireless Facilities, Inc. 1,200 60
- Wit Soundview Group, Inc. 3,000 21
-+ Witness Systems, Inc. 500 9
- WorldGate Communications, Inc. 700 13
-+ Xybernaut Corp. 1,400 7
- Yahoo!, Inc. 16,432 963
-+ Zamba Corp. 2,000 7
- Zixit Corp. 400 10
------
39,192
CHEMICAL 0.9%
----------------------------------------------------------------------
A. Schulman, Inc. 700 8
Aceto Corp. 500 5
- Advanced Technical Products, Inc. 400 2
Air Products & Chemicals, Inc. 8,500 317
- Airgas, Inc. 1,900 13
Albemarle Corp. 1,100 26
Arch Chemicals, Inc. 700 14
Cabot Corp. 2,000 44
-+ Cabot Microelectronics Corp. 1,160 51
+ Calgon Carbon Corp. 500 3
Cambrex Corp. 700 28
Chemfirst, Inc. 500 11
Crompton Corp. 2,624 21
Dow Chemical Co. 19,600 600
E.I. du Pont de Nemours & Co. 30,595 1,388
Eastman Chemical Co. 2,600 111
Ferro Corp. 700 14
-+ Foamex International, Inc. 400 2
Georgia Gulf Corp. 800 11
Great Lakes Chemical Corp. 2,100 70
H.B. Fuller Co. 400 14
Hawkins Chemical, Inc. 1,300 10
Hercules, Inc. 3,200 59
- International Specialty Products, Inc. 1,400 9
Lilly Industries, Inc., Class A 800 24
Lubrizol Corp. 1,400 30
Lyondell Chemical Co. 4,100 59
MacDermid, Inc. 800 17
Millennium Chemicals, Inc. 1,500 24
NCH Corp. 300 12
Oil-Dri Corp. of America 400 3
Olin Corp. 900 16
OM Group, Inc. 700 32
Omnova Solutions, Inc. 1,000 6
Penford Corp. 1,200 15
PPG Industries, Inc. 6,100 272
Praxair, Inc. 5,800 216
Quaker Chemical Corp. 400 7
Rohm & Haas Co. 7,253 218
Rollins, Inc. 800 14
RPM, Inc. 2,400 21
Sigma-Aldrich Corp. 2,900 104
Solutia, Inc. 2,800 36
+ Stepan Co. 200 4
- SurModics, Inc. 400 21
Tredegar Corp. 800 15
- Twinlab Corp. 900 5
Union Carbide Corp. 4,200 181
Valspar Corp. 1,100 30
- W.R. Grace & Co. 1,800 7
WD-40 Co. 400 9
Wellman, Inc. 900 13
- Zoltek Cos., Inc. 600 4
------
4,246
CONSTRUCTION 0.4%
----------------------------------------------------------------------
Armstrong Holdings, Inc. 1,600 5
Carbo Ceramics, Inc. 500 15
Centex Construction Products, Inc. 700 18
Centex Corp. 1,700 63
Clayton Homes, Inc. 4,100 38
-+ CoorsTek, Inc. 450 13
Craftmade International, Inc. 1,200 8
</TABLE>
86 See the Financial Notes, which
are integral to this information.
<PAGE> 91
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Crossmann Communities, Inc. 700 13
D.R. Horton, Inc. 1,744 32
- DAL-Tile International, Inc. 1,300 16
- Del E. Webb Corp. 600 16
- Dycom Industries, Inc. 1,300 49
Elcor Corp. 450 7
Florida Rock Industries, Inc. 500 19
Fluor Corp. 2,200 77
Granite Construction, Inc. 700 16
-+ Huttig Building Products, Inc. 311 1
- Insituform Technologies, Inc., Class A 800 29
- Integrated Electrical Services, Inc. 1,100 8
Interface, Inc. 1,200 11
Johns Manville Corp. 4,200 39
Kaufman & Broad Home Corp. 1,400 42
Lafarge Corp. 1,900 36
Lennar Corp. 2,745 88
Martin Marietta Materials, Inc. 1,300 50
Masco Corp. 13,500 252
-+ NCI Building Systems, Inc. 400 6
- NVR, Inc. 500 52
- Palm Harbor Homes, Inc. 700 10
Puerto Rican Cement Co., Inc. 400 12
Pulte Corp. 1,200 40
- Quanta Services, Inc. 1,900 59
+ The Ryland Group, Inc. 200 6
- Sawtek, Inc. 1,200 61
-+ SBA Communications Corp. 1,100 55
Sherwin-Williams Co. 4,700 102
- Simpson Manufacturing, Inc. 300 13
Southdown, Inc. 1,200 85
- Specialty Equipment Cos., Inc. 700 21
The Stanley Works 2,500 67
- Stone & Webster, Inc. 700 1
Texas Industries, Inc. 500 12
- Toll Brothers, Inc. 1,800 58
- Trex Co., Inc. 500 19
United Dominion Industries Ltd. 1,000 22
USG Corp. 1,400 24
Vulcan Materials Co. 3,000 126
Walter Industries, Inc. 1,300 10
- Wesco International, Inc. 1,700 14
-----
1,836
CONSUMER: DURABLE 0.2%
- Applica, Inc. 1,100 6
Black & Decker Corp. 2,400 90
- Champion Enterprises, Inc. 2,200 9
- Chromcraft Revington, Inc. 800 7
Coachmen Industries, Inc. 700 6
Compx International, Inc. 800 10
-+ Energizer Holdings, Inc. 3,033 60
Ethan Allen Interiors, Inc. 1,000 29
Flexsteel Industries, Inc. 600 7
-+ FuelCell Energy, Inc. 400 31
- Furniture Brands International, Inc. 1,400 24
- Genlyte Group, Inc. 600 16
Haverty Furniture Cos., Inc. 800 9
- Helen of Troy Ltd. 1,100 6
Hillenbrand Industries, Inc. 2,300 106
Kimball International, Inc., Class B 2,100 33
La-Z-Boy, Inc. 1,600 25
Leggett & Platt, Inc. 5,600 92
- Linens 'N Things, Inc. 1,100 34
Maytag Corp. 2,200 63
Mikasa, Inc. 700 11
- Mohawk Industries, Inc. 1,500 33
National Presto Industries, Inc. 400 12
- Rent-A-Center, Inc. 1,000 29
- Restoration Hardware, Inc. 1,700 5
- Salton, Inc. 400 9
Shaw Industries, Inc. 3,625 67
SLI, Inc. 1,100 9
Sturm, Ruger & Co., Inc. 1,100 9
Thomas Industries, Inc. 700 15
Toro Co. 400 14
Virco Manufacturing Corp. 968 10
-+ Water Pik Technologies, Inc. 195 2
Whirlpool Corp. 2,100 91
-----
979
CONSUMER: NONDURABLE 1.0%
- The 3DO Co. 2,100 6
- A.T. Cross Co., Class A 2,400 12
American Greetings Corp., Class A 3,000 55
Applebee's International, Inc. 700 21
- Boyd Gaming Corp. 2,800 11
- Boyds Collection Ltd. 2,200 17
</TABLE>
See the Financial Notes, which 87
are integral to this information.
<PAGE> 92
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) - FINANCIALS
PORTFOLIO HOLDINGS Continued
AS OF OCTOBER 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ X 1,000)
<S> <C>
- BRINKER INTERNATIONAL, INC. 2,200 86
- Buca, Inc. 1,100 17
- Catalina Marketing Corp. 1,500 59
CBRL Group, Inc. 1,600 29
- CEC Entertainment, Inc. 650 21
Cedar Fair L.P. 1,400 25
- Championship Auto Racing Teams, Inc. 700 17
- The Cheesecake Factory 950 42
- Consolidated Products, Inc. 1,580 12
-+ Corvis Corp. 10,000 656
- Cytyc Corp. 1,600 95
Darden Restaurants, Inc. 3,600 81
- Dave and Buster's, Inc. 1,700 14
- Department 56, Inc. 1,600 23
Dover Downs Entertainment, Inc. 1,400 16
- Electronic Arts, Inc. 3,800 190
- Factory 2-U Stores, Inc. 600 19
Fastenal Co. 1,100 63
The First Years, Inc. 1,500 15
Fortune Brands, Inc. 5,100 150
- Fossil, Inc. 1,650 22
- Garden Fresh Restaurant Corp. 1,300 11
- Handleman Co. 1,400 14
Harcourt General, Inc. 2,100 118
Hasbro, Inc. 5,400 58
- Hollywood.com, Inc. 1,100 8
- IHOP Corp. 1,000 21
- International Game Technology 2,800 103
International Speedway Corp., Class A 1,545 50
- Isle of Capri Casinos, Inc. 1,100 12
- Jack in the Box, Inc. 900 22
- JAKKS Pacific, Inc. 800 7
Lancaster Colony Corp. 1,000 24
- Landry's Seafood Restaurants, Inc. 1,800 15
Lone Star Steakhouse & Saloon, Inc. 1,400 12
Luby's, Inc. 1,400 8
The Marcus Corp. 1,500 21
- Marvel Enterprises, Inc. 2,300 6
Mattel, Inc. 12,800 166
McDonald's Corp. 40,000 1,240
-+ MCK Communications, Inc. 600 9
- Midway Games, Inc. 2,100 16
Movado Group, Inc. 1,700 24
- Musicland Stores Corp. 1,600 13
Newell Rubbermaid, Inc. 9,000 173
- NPC International, Inc. 1,500 17
-+ Omnivision Technologies, Inc. 600 20
- On Command Corp. 900 9
Oneida Ltd. 700 7
- Outback Steakhouse, Inc. 2,300 66
-+ Packard Bioscience Co. 300 5
- Papa John's International, Inc. 700 18
- Rare Hospitality International Inc. 1,050 24
Regis Corp. 1,000 15
Riviana Foods, Inc. 900 15
Ruby Tuesday, Inc. 3,600 49
Russ Berrie & Co., Inc. 1,000 23
- Ryan's Family Steak Houses, Inc. 1,500 13
- SCP Pool Corp. 900 23
- Sonic Corp. 500 18
- Sotheby's Holdings, Inc., Class A 1,600 43
- Starbucks Corp. 5,900 264
- Student Advantage, Inc. 1,900 7
- The Topps Co., Inc. 1,700 15
- Trans World Entertainment Corp. 1,500 13
- Triarc Cos., Inc. 700 17
- Tricon Global Restaurants, Inc. 4,200 126
Tupperware Corp. 1,400 24
Wendy's International, Inc. 3,200 70
- Yankee Candle Co., Inc. 1,500 22
-----
4,848
CONTAINERS 0.1%
-------------------------------------------------------------------------
- AEP Industries, Inc. 400 14
Ball Corp. 700 25
Bemis Co., Inc. 1,500 39
Crown Cork & Seal Co., Inc. 3,600 33
Greif Brothers Corp., Class A 500 16
Liqui-Box Corp. 200 7
- Mobile Mini, Inc. 600 12
- Owens-Illinois, Inc. 4,000 24
-+ Packaging Corp. of America 2,700 40
-+ Pactiv Corp. 5,100 54
- Sealed Air Corp. 2,500 120
</TABLE>
88 See the Financial Notes, which
are integral to this information.
<PAGE> 93
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Silgan Holdings, Inc. 900 8
Sonoco Products Co. 2,900 56
Tuscarora, Inc. 400 5
-----
453
ELECTRONICS 9.1%
-----------------------------------
- 3Dfx Interactive, Inc. 1,300 6
-+ ACT Manufacturing, Inc. 500 16
- Acxiom Corp. 2,600 105
-+ ADAC Laboratories 1,000 13
- Adaptive Broadband Corp. 1,000 16
- ADC Telecommunications, Inc. 21,720 464
- Adelphia Business Solutions, Inc. 900 6
- Adelphia Communications Corp., Class A 3,201 106
- Advanced Fibre Communications, Inc. 2,400 78
- Advanced Micro Devices, Inc. 10,300 233
- Advanced Radio Telecom Corp. 1,000 4
-+ Airnet Communications Corp. 700 11
- Alpha Industries, Inc. 1,200 48
-+ Alamosa PCS Holdings, Inc. 1,700 26
- Allen Telecom, Inc. 1,500 28
- Alliant Techsystems, Inc. 500 45
- Altera Corp. 12,100 495
- American Power Conversion Corp. 5,600 72
- Amkor Technology, Inc. 4,300 97
- Amphenol Corp., Class A 1,200 77
- Anadigics, Inc. 750 17
- Analog Devices, Inc. 10,400 676
-+ Anaren Microwave, Inc. 400 42
- Andrew Corp. 2,600 68
- Anixter International, Inc. 1,100 27
- Antec Corp. 1,100 13
- Applied Materials, Inc. 24,249 1,288
-+ APW Ltd. 1,100 51
- Arguss Communications, Inc. 1,100 14
- Arrow Electronics, Inc. 2,800 90
- Artisan Components, Inc. 1,100 10
- Aspect Communications Corp. 1,700 28
-+ AstroPower, Inc. 300 17
- Asyst Technologies, Inc. 1,200 18
- Atmel Corp. 14,700 220
- ATMI, Inc. 900 17
- Audiovox Corp., Class A 600 8
-+ Avanex Corp. 200 20
- Avid Technology, Inc. 800 11
Avnet, Inc. 3,092 83
- AVT Corp. 1,400 9
AVX Corp. 5,000 143
- Aware, Inc. 700 22
-+ AXT, Inc. 600 23
- Bel Fuse, Inc., Class A 700 30
+ Bel Fuse, Inc., Class B 500 20
Belden, Inc. 800 21
- Benchmark Electronics, Inc. 700 28
BMC Industries, Inc. 1,300 8
Boston Acoustics, Inc. 800 12
- Broadcom Corp., Class A 6,700 1,490
-+ Brooks Automation, Inc. 500 13
-+ Bruker Daltonics, Inc. 1,600 55
C&D Technologies, Inc. 1,000 59
- C-COR.net Corp. 800 13
- Cable Design Technologies Corp. 1,200 28
- Cadence Design Systems, Inc. 7,300 188
-+ Caliper Technologies Corp. 700 39
- Caprock Communications Corp. 900 6
- CCC Information Services Group, Inc. 1,100 8
- CIENA Corp. 8,400 883
- Cirrus Logic, Inc. 2,100 91
- CMGI, Inc. 8,686 147
-+ Cobalt Networks, Inc. 800 44
- Coherent, Inc. 1,800 63
Cohu, Inc. 600 9
- CommScope, Inc. 1,400 35
- Computer Network Technology Corp. 700 21
- Concord Communications, Inc. 500 4
- Conexant Systems, Inc. 6,696 176
- Cox Radio, Inc., Class A 1,100 25
- Cree, Inc. 1,000 99
CTS Corp. 800 34
- Cyberonics, Inc. 1,200 28
- Cypress Semiconductor Corp. 4,200 157
- Dallas Semiconductor Corp. 1,800 71
-+ DDI Corp. 1,100 44
</TABLE>
See the Financial Notes, which 89
are integral to this information.
<PAGE> 94
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) - FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Dionex Corp. 500 16
- DMC Stratex Networks, Inc. 2,200 51
- DSP Group, Inc. 800 23
- Dupont Photomasks, Inc. 500 28
- Electro Rent Corp. 1,100 15
- Electro Scientific Industries, Inc. 800 28
- Electroglas, Inc. 900 13
- Electronics Boutique Holdings Corp. 800 13
- Electronics for Imaging, Inc. 1,500 23
-+ Emcore Corp. 1,000 41
- Emulex Corp. 1,000 147
- ESS Technology, Inc. 1,000 16
-+ Exar Corp. 1,300 58
-+ FEI Co. 700 17
- FSI International, Inc. 1,300 12
- FVC.com, Inc. 1,200 3
- Gadzoox Networks, Inc. 600 2
- Gasonics International Corp. 1,100 22
-+ Genencor International, Inc. 1,700 47
General Cable Corp. 1,700 10
- General Semiconductor, Inc. 800 9
- Genrad, Inc. 1,000 9
- Gentex Corp. 2,100 52
Gerber Scientific, Inc. 800 6
- Getty Images, Inc. 1,400 44
-+ Glenayre Technologies, Inc. 1,500 12
- Globespan, Inc. 2,000 154
Harman International Industries, Inc. 1,000 48
- Harmonic, Inc. 1,542 22
Harris Corp. 2,000 63
- Hearst-Argyle Television, Inc. 1,300 23
- HI/FN, Inc. 300 19
- Hollywood Entertainment Corp. 2,000 6
- Hutchinson Technology, Inc. 800 18
-+ iBeam Broadcasting Corp. 2,900 16
- Imation Corp. 800 16
- IMRglobal Corp. 1,100 9
-+ Integrated Circuit Systems, Inc. 1,900 26
(5) Intel Corp. 201,132 9,051
- Intermagnetics General Corp. 1,854 48
- International Rectifier Corp. 1,900 85
- Internet Security Systems 1,200 106
ITT Industries, Inc. 3,800 124
- JDS Uniphase Corp. 27,984 2,279
-+ JNI Corp. 800 71
- Kemet Corp. 2,700 75
- Kent Electronics Corp. 800 15
- KLA-Tencor Corp. 5,800 196
- Kopin Corp. 1,800 25
- Kulicke & Soffa Industries, Inc. 1,400 21
- L-3 Communications Holdings, Inc. 900 59
- Lam Research Corp. 3,600 70
Linear Technology Corp. 9,300 600
- Littelfuse, Inc. 500 15
- Loral Space & Communications Corp. 8,500 48
- LSI Logic Corp. 9,100 299
Lucent Technologies, Inc. 100,023 2,332
- Macromedia, Inc. 1,500 116
- Mattson Technology, Inc. 1,100 13
- Maxim Integrated Products, Inc. 8,400 557
- MEMC Electronic Materials, Inc. 2,700 27
-+ Merix Corp. 400 19
- Mestek, Inc. 700 12
Methode Electronics, Inc., Class A 1,100 41
- Metro Information Services, Inc. 700 4
- Metromedia Fiber Network, Inc., Class A 14,310 272
- Micron Technology, Inc. 17,000 591
- Microsemi Corp. 1,500 60
- MKS Instruments, Inc. 600 11
Molex, Inc. 6,425 347
Moody's Corp. 4,800 126
Motorola, Inc. 66,155 1,650
- MRV Communications, Inc. 2,200 87
- Mynd Corp. 1,600 20
-+ Nanogen, Inc. 500 8
- National Semiconductor Corp. 6,000 156
- Netopia, Inc. 600 7
- Netro Corp. 1,400 31
-+ New Focus, Inc. 200 13
+ Newport Corp. 1,000 114
- Nextel Communications, Inc., Class A 22,700 873
</TABLE>
90 See the Financial Notes, which
are integral to this information.
<PAGE> 95
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
-+ Nextel Partners, Inc., Class A 4,800 118
- Novoste Corp. 900 23
- Nvidia Corp. 2,700 168
-+ Objective Systems Integrators, Inc. 900 8
-+ OYO Geospace Corp. 300 5
- P-Com, Inc. 1,700 10
- Parkervision, Inc. 400 22
- Paxson Communications Corp. 1,900 22
- PE Corp.-Celera Genomics Group 1,700 115
PE Corp.-PE Biosystems Group 6,300 737
-+ PeoplePC, Inc. 3,000 10
-+ Pericom Semiconductor Corp. 600 16
PerkinElmer, Inc. 3,500 418
- Photronics, Inc. 900 20
- Pinnacle Systems, Inc. 1,200 15
Pioneer Standard Electronics, Inc. 1,100 15
-+ Pixelworks, Inc. 1,100 37
- Plantronics, Inc. 1,500 68
- Plexus Corp. 1,000 63
- PLX Technology, Inc. 800 19
- Powell Industries, Inc. 2,000 22
- Power Intergrations, Inc. 600 8
- Power-One, Inc. 2,200 156
- Powerwave Technologies, Inc. 1,700 82
- PRI Automation, Inc. 700 16
- QUALCOMM, Inc. 22,200 1,445
-+ Quicklogic Corp. 400 4
- Rambus, Inc. 2,900 130
- Rational Software Corp. 5,700 340
- Rayovac Corp. 800 12
- Remec, Inc. 1,500 45
- RF Micro Devices, Inc. 4,600 92
- Rofin-Sinar Technologies, Inc. 1,400 14
- Rogers Corp. 800 29
- Sanmina Corp. 4,660 533
- SCI Systems, Inc. 4,400 189
Scientific-Atlanta, Inc. 5,000 342
-+ Semitool, Inc. 600 8
- Semtech Corp. 2,000 65
- Sensormatic Electronics Corp. 2,000 36
- Silicon Storage Technology, Inc. 2,600 59
- Silicon Valley Group, Inc. 1,000 33
- Siliconix, Inc. 800 35
-+ Sipex Corp. 600 24
- Solectron Corp. 18,020 793
- Spectra-Physics Lasers, Inc. 400 14
-+ SpeechWorks International, Inc. 1,000 83
- SpeedFam-IPEC, Inc. 900 9
*-+ Stora Enso Oyj 4,199 43
-+ Superconductor Technologies 300 3
Superior TeleCom, Inc. 1,124 6
Symbol Technologies, Inc. 4,675 212
- Symmetricom, Inc. 2,100 27
-+ Synavant, Inc. 425 2
Technitrol, Inc. 500 55
- Tekelec, Inc. 1,600 59
Tektronix, Inc. 1,400 100
-+ Telaxis Communications Corp. 400 2
-+ TeleCorp PCS, Inc. 2,600 49
- Tellabs, Inc. 12,300 614
- Teradyne, Inc. 5,000 156
- Terayon Communication Systems, Inc. 1,800 40
- Tessco Technologies, Inc. 700 17
Texas Instruments, Inc. 51,847 2,544
-+ Therma-Wave, Inc. 700 14
- Thermo Electron Corp. 10,150 294
Thomas & Betts Corp. 2,400 36
- THQ, Inc. 800 16
- Three-Five Systems, Inc. 2,199 76
-+ Tollgrade Communications, Inc. 400 38
- TranSwitch Corp. 2,600 150
- Triquint Semiconductor, Inc. 2,200 84
-+ Tweeter Home Entertainment Group, Inc. 600 14
-+ Ulticom, Inc. 1,100 53
Unitil Corp. 600 16
- Univision Communications, Inc., Class A 6,200 237
-+ Valence Technology, Inc. 900 13
- Varian Medical Systems, Inc. 900 44
- Varian Semiconductor Equipment 1,000 23
- Varian, Inc. 1,300 40
Vector Group Ltd. 761 11
-+ Viasat, Inc. 400 9
- Vicor Corp. 1,200 65
</TABLE>
See the Financial Notes, which 91
are integral to this information.
<PAGE> 96
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) - FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
-+ Virata Corp. 1,700 33
- Vishay Intertechnology, Inc. 3,950 119
- VISX, Inc. 1,800 39
- Waters Corp. 3,800 276
- WebMD Corp. 11,326 129
-+ Western Digital Corp. 4,200 25
- Western Wireless Corp., Class A 2,000 95
- Wink Communications, Inc. 800 8
- Xilinx, Inc. 9,700 703
-+ Zoran Corp. 500 25
------
43,762
ENERGY: RAW MATERIALS 1.3%
------------------------------------
Anadarko Petroleum Corp. 7,630 489
Apache Corp. 4,200 232
Arch Coal, Inc. 900 10
- Atwood Oceanics, Inc. 500 17
Baker Hughes, Inc. 10,800 371
- Barrett Resources Corp. 900 33
- Basin Exploration, Inc. 1,200 24
Berry Petroleum, Class A 1,000 17
- BJ Services Co. 2,500 131
Buckeye Partners L.P. 700 21
Burlington Resources, Inc. 6,700 241
Cabot Oil & Gas Corp., Class A 900 18
-+ Chesapeake Energy Corp. 2,300 13
Cooper Cameron Corp. 1,600 87
Devon Energy Corp. 4,636 234
- Dril-Quip, Inc. 500 17
Eastern Enterprises 500 32
ENSCO International, Inc. 4,300 143
Enterprise Products Partners L.P. 1,100 28
EOG Resources, Inc. 3,400 134
- Evergreen Resources, Inc. 800 22
- Forest Oil Corp. 1,500 21
- Friede Goldman Halter, Inc. 1,855 11
- Global Marine, Inc. 5,300 140
-+ Grey Wolf, Inc. 1,800 8
Halliburton Co. 13,200 489
Helmerich & Payne, Inc. 1,300 41
- Key Energy Services, Inc. 2,800 25
- KEY Production Co., Inc. 1,200 26
- Kirby Corp. 800 15
- Louis Dreyfus Natural Gas Corp. 1,200 38
McDermott International, Inc. 1,700 16
Mitchell Energy & Development Corp., Class A 1,300 60
- Nabors Industries, Inc. 4,517 230
- Newpark Resources, Inc. 2,200 20
NL Industries, Inc. 1,500 35
Noble Affiliates, Inc. 1,600 59
- Noble Drilling Corp. 4,200 175
Occidental Petroleum Corp. 12,200 242
- Offshore Logistics, Inc. 600 10
- Parker Drilling Co. 500 3
Penn Virginia Corp. 400 11
Plains All American Pipeline L.P. 1,000 19
- Plains Resources, Inc. 1,000 19
- Prima Energy Corp. 1,050 47
- R&B Falcon Corp. 5,500 138
- Rowan Cos., Inc. 3,400 86
Schlumberger Ltd. 16,900 1,287
- Sitel Corp. 800 12
- Smith International, Inc. 1,500 106
- Southwestern Energy Co. 300 2
- Swift Energy Co. 1,100 36
Tidewater, Inc. 1,700 79
- Tom Brown, Inc. 900 21
- Trico Marine Services, Inc. 1,300 22
- Unit Corp. 1,600 21
- UTI Energy Corp. 1,200 24
Valero Energy Corp. 1,600 53
- Weatherford International, Inc. 3,600 131
Western Gas Resources, Inc. 2,000 44
------
6,136
FOOD & AGRICULTURE 2.7%
-----------------------------------
- Ag-Chem Equipment, Inc. 1,400 16
- Agribrands International, Inc. 400 17
- American Italian Pasta Co., Class A 500 10
Andersons, Inc. 1,500 13
Archer-Daniels-Midland Co. 21,575 237
- Bob Evans Farms, Inc. 2,200 41
- Cadiz, Inc. 1,600 17
Campbell Soup Co. 12,400 363
Coca-Cola Bottling Co.
Consolidated 400 14
Coca-Cola Co. 74,200 4,480
</TABLE>
92 See the Financial Notes, which
are integral to this information.
<PAGE> 97
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Coca-Cola Enterprises, Inc. 12,600 232
ConAgra, Inc. 15,893 340
Consolidated-Tomoka Land Co. 1,100 13
Corn Products International, Inc. 900 23
- CTB International Corp. 1,600 12
Dean Foods Co. 900 29
- Del Monte Foods Co. 1,500 9
Delta & Pine Land Co. 900 22
Dole Food Co., Inc. 1,600 19
Dreyer's Grand Ice Cream, Inc. 800 20
Earthgrains Co. 2,100 43
-+ Embrex, Inc. 300 4
Fleming Cos., Inc. 1,300 18
Flowers Industries, Inc. 2,800 43
- Fresh Del Monte Produce, Inc. 1,700 7
General Mills, Inc. 8,700 363
- Gumtech International, Inc. 400 5
-+ H Power Corp. 1,500 32
H.J. Heinz Co. 10,200 428
Hershey Foods Corp. 4,500 244
Hormel Foods Corp. 5,000 84
IBP, Inc. 3,200 66
IMC Global, Inc. 3,100 40
International Multifoods Corp. 600 10
Interstate Bakeries Corp. 1,700 24
- J & J Snack Foods Corp. 700 9
Keebler Foods Co. 2,400 97
Kellogg Co. 11,800 299
-+ Krispy Kreme Doughnuts, Inc. 400 39
Lance, Inc. 1,200 12
Lindsay Manufacturing Co. 800 17
Marsh Supermarkets, Inc., Class B 1,000 13
Maui Land & Pineapple Co. 800 19
McCormick & Co., Inc. 1,900 60
Michael Foods, Inc. 500 13
Midwest Grain Products, Inc. 1,500 13
Nabisco Group Holdings Corp. 10,200 295
Nabisco Holdings Corp., Class A 1,600 87
Nash Finch Co. 1,800 22
The Pepsi Bottling Group, Inc. 4,200 145
PepsiCo, Inc. 43,100 2,088
Pilgrim's Pride Corp., Class B 1,400 9
Quaker Oats Co. 3,900 318
- Ralcorp Holdings, Inc. 700 10
- Ralston Purina Group 9,100 221
Sanderson Farms, Inc. 1,400 10
Sara Lee Corp. 25,600 552
Schultz SAV O Stores, Inc. 1,100 12
- The Scotts Co., Class A 700 25
- Smithfield Foods, Inc. 1,600 46
- Suiza Foods Corp. 900 42
Supervalu, Inc. 5,187 80
Sysco Corp. 9,900 517
Tasty Baking Co. 1,300 15
- Tejon Ranch Co. 600 14
Tootsie Roll Industries, Inc. 921 35
Tyson Foods, Inc., Class A 7,300 82
- Ultrak, Inc. 1,500 7
- United Natural Foods, Inc. 1,300 16
- Universal Foods Corp. 1,200 24
Whitman Corp. 3,700 48
- Whole Foods Market, Inc. 800 37
- Wild Oats Markets, Inc. 650 4
Wm. Wrigley Jr. Co. 3,800 301
------
12,991
GOLD 0.0%
----------------------------------------------------------------------
- Battle Mountain Gold Co. 4,300 6
- Golden Cycle Gold Corp. 600 3
Homestake Mining Co. 7,000 29
- Meridian Gold, Inc. 2,100 11
Newmont Mining Corp. 6,300 85
------
134
HEALTHCARE / DRUGS & MEDICINE 11.7%
----------------------------------------------------------------------
-+ 3-Dimensional Pharmaceuticals, Inc. 600 14
Abbott Laboratories 46,405 2,451
- Abgenix, Inc. 2,400 189
-+ Abiomed, Inc. 800 23
-+ Acacia Research Corp. 300 10
-+ Accredo Health, Inc. 500 22
- Acuson Corp. 1,100 25
- Advance Paradigm, Inc. 1,100 54
Aetna, Inc. 5,200 301
-+ Albany Molecular Research, Inc. 800 47
</TABLE>
See the Financial Notes, which
are integral to this information. 93
<PAGE> 98
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) - FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
-+ Alexion Pharmaceuticals, Inc. 400 41
- Alkermes, Inc. 1,600 59
Allergan, Inc. 4,400 370
-+ Alliance Pharmaceutical Corp. 1,100 16
-+ Allscripts, Inc. 800 10
Alpharma, Inc., Class A 1,200 47
- ALZA Corp. 3,500 283
American Home Products Corp. 39,100 2,483
- Ameripath, Inc. 1,900 34
- Amerisource Health Corp., Class A 1,400 61
- Amgen, Inc. 30,600 1,773
-+ Amylin Pharmaceuticals, Inc. 1,700 17
- Andrx Group 2,000 144
-+ Antigenics, Inc. 600 9
- Apria Healthcare Group, Inc. 1,200 24
Arrow International, Inc. 500 20
- Arthrocare Corp. 600 14
-+ Aspect Medical Systems, Inc. 400 4
- Atrix Labs, Inc. 1,400 25
- Aurora Biosciences Corp. 1,200 73
-+ Avant Immunotherapeutics, Inc. 2,100 18
-+ Avigen, Inc. 500 19
- Aviron 800 52
- Bacou USA, Inc. 1,000 25
- Barr Laboratories, Inc. 1,050 66
Bausch & Lomb, Inc. 1,900 73
Baxter International, Inc. 8,565 704
Beckman Coulter, Inc. 800 56
Becton, Dickinson & Co. 8,100 271
Bergen Brunswig Corp., Class A 3,800 34
Bindley Western Industries, Inc. 1,033 37
- Bio-Rad Laboratories, Inc., Class A 500 15
- Bio-Technology General Corp. 1,200 13
- Biocryst Pharmaceuticals, Inc. 700 6
- Biogen, Inc. 4,600 277
- Biomatrix, Inc. 800 15
Biomet, Inc. 5,150 186
-+ Biopure Corp. 700 14
-+ Biosite Diagnostics, Inc. 400 9
Block Drug Co., Class A 715 37
- Bone Care International, Inc. 1,400 34
- Boston Scientific Corp. 13,400 214
Bristol-Myers Squibb Co. 59,000 3,595
C.R. Bard, Inc. 1,400 59
Cardinal Health, Inc. 8,200 777
- Caremark Rx, Inc. 6,100 76
Carter-Wallace, Inc. 1,100 30
- Celgene Corp. 3,000 193
-+ Cell Genesys, Inc. 1,000 23
-+ Cell Pathways, Inc. 800 6
-+ Cell Therapeutics, Inc. 700 47
- Cephalon, Inc. 1,100 59
-+ Cerus Corp. 500 28
- Chattem, Inc. 1,100 7
- Chiron Corp. 5,800 251
- ChromaVision Medical Systems, Inc. 1,100 5
-+ Community Health Systems, Inc. 2,200 62
- Conmed Corp. 500 7
Cooper Cos., Inc. 600 21
- COR Therapeutics, Inc. 2,200 124
- Corixa Corp. 1,100 49
- Corvel Corp. 600 19
- Coulter Pharmaceutical, Inc. 700 27
- Covance, Inc. 1,800 16
- Coventry Health Care, Inc. 1,700 31
-+ Cubist Pharmaceuticals, Inc. 700 30
-+ Curis, Inc. 540 7
-+ CV Therapeutics, Inc. 600 47
-+ Cyotgen Corp. 2,300 13
- D&K Healthcare Resources, Inc. 1,500 21
Datascope Corp. 500 17
-+ DaVita, Inc. 2,500 28
-+ Deltagen, Inc. 600 10
Dentsply International, Inc. 1,500 52
Diagnostic Products Corp. 600 27
- Digene Corp. 600 19
- Dura Pharmaceuticals, Inc. 1,200 41
- Duramed Pharmaceuticals, Inc. 1,900 10
-+ Edwards Lifesciences Corp. 1,500 20
*-+ Elan Corp. PLC 500 26
Eli Lilly & Co. 33,900 3,030
-+ Emisphere Technologies, Inc. 500 13
-+ Endo Pharmaceutical Holdings, Inc. 2,600 18
</TABLE>
94 See the Financial Notes, which
are integral to this information.
<PAGE> 99
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Entremed, Inc. 500 16
- Enzo Biochem, Inc. 800 31
- Enzon, Inc. 1,200 85
- First Health Group Corp. 1,300 51
- Forest Laboratories, Inc.,
Class A 2,600 345
- Foundation Health Systems, Inc.,
Class A 3,800 77
- GelTex Pharmaceuticals, Inc. 700 35
-+ Gene Logic, Inc. 1,300 28
- Genentech, Inc. 6,400 528
-+ Genome Therapeutics Corp. 700 10
- Genzyme Corp. -- General
Division 2,700 192
- Genzyme Surgical Products 996 7
-+ Geron Corp. 600 14
- Gilead Sciences, Inc. 1,965 169
- Guidant Corp. 9,016 477
-+ Guilford Pharmaceuticals, Inc. 700 17
- Haemonetics Corp. 700 16
HCA -- The Healthcare Co. 16,400 655
- Health Management Associates, Inc.,
Class A 7,100 141
- Healthcare Services Group 2,500 12
- HealthSouth Corp. 12,400 149
HEICO Corp., Class A 1,100 12
- Henry Schein, Inc. 1,100 27
- Hologic, Inc. 2,000 13
Hooper Holmes, Inc. 1,400 13
- Human Genome Sciences, Inc. 3,200 283
- Humana, Inc. 6,100 74
-+ Hyseq, Inc. 400 12
ICN Pharmaceuticals, Inc. 2,800 107
- Idec Pharmaceuticals Corp. 1,300 255
Idexx Laboratories, Inc. 1,000 24
- Igen International, Inc. 800 20
-+ Ilex Oncology, Inc. 700 25
-+ Illumina, Inc. 900 29
- ImClone Systems 1,800 98
- Immunex Corp. 14,800 630
-+ Immunogen, Inc. 1,000 34
-+ Immunomedics, Inc. 1,200 28
-+ Inamed Corp. 500 14
- Incyte Genomics, Inc. 1,800 66
-+ Inforte Corp. 400 12
- Inhale Therapeutic Systems, Inc. 1,400 70
-+ Inspire Pharmaceuticals, Inc. 700 14
-+ Integrated Telecom Express, Inc. 1,200 17
Invacare Corp. 800 23
-+ Isis Pharmaceuticals, Inc. 1,400 14
- IVAX Corp. 4,800 209
Johnson & Johnson 41,730 3,844
- King Pharmaceuticals, Inc. 4,812 216
-+ KV Pharmaceutical Co., Class A 800 31
- LabOne, Inc. 1,300 9
-+ Laboratory Corp. of America Holdings,
Inc. 350 47
-+ Large Scale Biology Corp. 700 13
- LifePoint Hospitals, Inc. 1,100 43
- Ligand Pharmaceuticals, Inc.,
Class B 1,300 19
- Lincare Holdings, Inc. 1,400 59
-+ Lynx Therapeutics, Inc. 300 5
- Manor Care, Inc. 2,900 48
- Maxim Pharmaceuticals, Inc. 900 40
McKesson HBOC, Inc. 8,800 247
-+ Medarex, Inc. 2,200 134
- Medicis Pharmaceutical Corp.,
Class A 1,700 125
- Medimmune, Inc. 6,100 399
-+ MedQuist, Inc. 917 10
Medtronic, Inc. 35,324 1,919
(9) Merck & Co., Inc. 69,000 6,206
-+ MGI Pharma, Inc. 600 17
- Mid Atlantic Medical Services,
Inc. 1,600 27
- Millennium Pharmaceuticals,
Inc. 5,884 427
Mine Safety Appliances Co. 900 19
- Minimed, Inc. 2,000 146
-+ Molecular Devices Corp. 400 27
Mylan Laboratories, Inc. 4,200 118
- Myriad Genetics, Inc. 1,400 168
- NBTY, Inc. 1,800 12
- Neurogen Corp. 800 25
-+ Nexell Therapeutics, Inc. 450 3
- Northfield Laboratories, Inc. 1,100 12
-+ Noven Pharmacuticals, Inc. 600 27
</TABLE>
See the Financial Notes, which 95
are integral to this information.
<PAGE> 100
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- NPS Pharmacuticals, Inc. 1,000 43
-+ Numerical Technologies, Inc. 800 16
Oakley, Inc. 2,200 46
- Ocular Sciences, Inc. 1,000 12
Omnicare, Inc. 2,400 42
- Onyx Pharmaceuticals, Inc. 1,200 18
- Organogenesis, Inc. 1,500 19
- OrthAlliance, Inc., Class A 2,100 8
- Orthodontic Centers of America, Inc. 1,400 47
- Osteotech, Inc. 700 4
Owens & Minor, Inc. 1,500 23
- Oxford Health Plans, Inc. 2,300 78
- Oxigene, Inc. 900 7
- PacifiCare Health Systems, Inc. 1,300 14
- Parexel International Corp. 1,900 17
- Patterson Dental Co. 1,800 56
- Pediatrix Medical Group, Inc. 2,200 35
- Penwest Pharmaceuticals Co. 1,200 13
- Perrigo Co. 2,800 19
(6) Pfizer, Inc. 189,300 8,175
- Pharmaceutical Product Development, Inc. 1,000 31
Pharmacia Corp. 38,916 2,140
- Pharmacopeia, Inc. 800 15
- Pharmacyclics, Inc. 400 22
-+ PolyMedica Corp. 500 29
-+ Progenics Pharmaceuticals, Inc. 300 7
- Province Healthcare Co. 1,050 44
- PSS World Medical, Inc. 1,900 6
- Quest Diagnostic, Inc. 1,600 154
- Quintiles Transnational Corp. 3,900 54
- Quorum Health Group, Inc. 2,000 27
-+ Regeneron Pharmaceuticals, Inc. 1,900 51
- Renal Care Group, Inc. 1,100 26
- ResMed, Inc. 1,000 26
- Respironics, Inc. 1,400 27
-+ Sangstat Medical Corp. 600 6
Schering-Plough Corp. 43,900 2,269
- Sepracor, Inc. 2,100 143
- Serologicals Corp. 3,000 20
-+ SICOR, Inc. 2,600 33
- Sola International, Inc. 2,700 12
- SonoSite, Inc. 600 8
- St. Jude Medical, Inc. 2,500 138
- Steris Corp. 2,000 30
Stryker Corp. 6,000 283
- Sunrise Assisted Living, Inc. 1,200 28
- Sunrise Medical, Inc. 1,900 18
- Sunrise Technologies International 1,700 12
- SuperGen, Inc. 900 12
-+ Support.com, Inc. 1,000 14
- Sybron International Corp. 2,900 72
- Syncor International Corp. 1,200 31
- Techne Corp. 500 56
- Tenet Healthcare Corp. 10,200 401
-+ Texas Biotech Corp. 1,100 16
- Thoratec Labs Corp. 1,300 16
-+ Titan Pharmaceuticals, Inc. 800 34
- Transkaryotic Therapies, Inc. 600 22
- Triad Hospitals, Inc. 1,100 31
- Triangle Pharmaceuticals, Inc. 1,000 8
- Trigon Healthcare, Inc. 1,200 86
-+ Trimeris, Inc. 500 35
- TriPath Imaging, Inc. 2,600 21
+ UnitedHealth Group, Inc. 5,800 634
- Universal Health Services, Class B 800 67
-+ Ventana Medical Systems 500 13
- Vertex Pharmaceuticals, Inc. 1,600 149
- Vical, Inc. 700 15
- Viropharma, Inc. 1,000 23
- Watson Pharmaceuticals, Inc. 3,432 215
- Wellpoint Health Networks, Inc. 2,400 281
West Pharmaceutical Services, Inc. 600 13
-+ Xoma Ltd. 1,700 21
- Young Innovations, Inc. 800 13
------
56,029
HOUSEHOLD PRODUCTS 1.2%
-------------------------------------------------------------------------
Alberto-Culver Co., Class B 2,800 94
Avon Products, Inc. 7,300 354
- Bush Boake Allen, Inc. 500 24
Church & Dwight Co., Inc. 800 16
Clorox Co. 7,100 317
Colgate-Palmolive Co. 16,700 981
</TABLE>
96 See the Financial Notes, which
are integral to this information.
<PAGE> 101
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Dial Corp. 2,700 30
Estee Lauder Cos., Inc., Class A 3,500 163
- French Fragrances, Inc. 1,200 14
Gillette Co. 31,300 1,092
- Guest Supply, Inc. 600 10
-+ Inter Parfums, Inc. 450 4
International Flavors & Fragrances, Inc. 3,400 57
- NU Skin Enterprises, Inc., Class A 3,300 18
- Playtex Products, Inc. 1,600 16
Procter & Gamble Co. 39,700 2,836
- Revlon, Inc., Class A 1,800 10
------
6,036
INSURANCE 3.7%
-------------------------------------------------------------------------
21st Century Insurance Group 2,300 38
+ ACE Ltd. 520 20
AFLAC, Inc. 7,300 533
Alfa Corp. 800 15
- Alleghany Corp. 200 38
Allmerica Financial Corp. 1,900 120
Allstate Corp. 22,374 901
AMBAC Financial Group, Inc. 2,100 168
American Financial Group, Inc. 1,500 32
American General Corp. 6,600 531
(8) American International Group, Inc. 70,287 6,888
American National Insurance Co. 600 41
AmerUs Group Co. 700 18
Aon Corp. 8,000 332
- Arch Capital Group Ltd. 800 12
Argonaut Group, Inc. 800 14
Arthur J. Gallagher & Co. 1,000 63
Baldwin & Lyons, Inc., Class B 600 11
Brown & Brown, Inc. 800 26
Chubb Corp. 5,847 494
CIGNA Corp. 6,300 768
Cincinnati Financial Corp. 4,600 169
- CNA Financial Corp. 4,800 175
CNA Surety Corp. 1,200 14
Commerce Group, Inc. 700 18
Conseco, Inc. 8,500 59
Crawford & Co., Class B 1,100 14
- Delphi Financial Group, Inc., Class A 510 19
E.W. Blanch Holdings, Inc. 400 8
Enhance Financial Services Group, Inc. 1,100 13
Erie Indemnity Co., Class A 1,600 45
Everest Re Group Ltd. 1,100 64
- Farm Family Holdings, Inc. 600 21
FBL Financial Group, Inc., Class A 950 15
First American Corp. 1,500 31
- FPIC Insurance Group, Inc. 700 10
Harleysville Group, Inc. 800 18
Hartford Financial Services Group, Inc. 6,300 469
HCC Insurance Holdings, Inc. 1,200 23
Hilb, Rogal & Hamilton Co. 400 16
Horace Mann Educators Corp. 800 13
HSB Group, Inc. 600 24
Jefferson-Pilot Corp. 3,200 220
- John Hancock Financial Services 9,400 297
Kansas City Life Insurance Co. 400 13
Leucadia National Corp. 1,600 40
Liberty Corp. 500 17
Liberty Financial Cos., Inc. 1,400 38
Lincoln National Corp. 6,100 295
Loew's Corp. 3,800 346
- Markel Corp. 100 14
Marsh & McLennan Cos., Inc. 7,900 1,033
MBIA, Inc. 3,500 254
Medical Assurance, Inc. 725 10
Mercury General Corp. 1,400 51
-+ Metlife, Inc. 5,900 163
MGIC Investment Corp. 3,200 218
MIIX Group, Inc. 1,000 8
Mony Group, Inc. 1,100 45
- National Western Life Insurance Co., Class A 300 27
Nationwide Financial Services, Inc., Class A 500 24
Ohio Casualty Corp. 1,600 13
Old Republic International Corp. 2,900 75
- Penn Treaty American Corp. 1,000 19
Penn-America Group, Inc. 900 7
</TABLE>
See the Financial Notes, which 97
are integral to this information.
<PAGE> 102
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Pico Holdings, Inc. 1,000 13
The PMI Group, Inc. 1,150 85
Presidential Life Corp. 700 10
- Professionals Group, Inc. 520 12
Progressive Corp. 2,800 275
Protective Life Corp. 1,400 32
Radian Group, Inc. 1,159 82
Reinsurance Group of America, Inc. 1,100 41
RLI Corp. 500 20
SAFECO Corp. 4,600 111
SCPIE Holdings, Inc. 500 10
Selective Insurance Group, Inc. 700 12
St. Paul Cos., Inc. 7,600 390
Stancorp Financial Group 1,000 41
State Auto Financial Corp. 1,300 18
Torchmark Corp. 3,600 120
Transatlantic Holdings, Inc. 900 84
Trenwick Group Ltd. 800 16
- Triad Guaranty, Inc. 500 15
- UICI 1,300 10
Unitrin, Inc. 1,900 59
UnumProvident Corp. 14,414 407
Vesta Insurance Group, Inc. 2,300 13
W.R. Berkley Corp. 700 24
White Mountains Insurance Group, Inc. 200 53
- XO Communications, Inc., Class A 6,701 226
Zenith National Insurance Corp. 600 14
------
17,721
MEDIA 3.5%
-------------------------------------------------------------------------
A.H. Belo Corp., Class A 3,300 63
Ackerly Group, Inc. 1,100 11
- Actv, Inc. 1,100 11
- American Tower Corp., Class A 5,100 209
Banta Corp. 700 16
BHC Communications, Inc., Class A 600 86
- Cablevision Systems Corp., Class A 3,900 291
Cadmus Communications Corp. 1,400 12
-+ California Amplifier, Inc. 600 15
-+ Charter Communications, Inc., Class A 4,900 96
- Chris-Craft Industries, Inc. 927 68
- Citadel Communications Corp. 1,000 12
- Clear Channel Communications, Inc. 17,286 1,038
- CNET Networks, Inc. 3,383 107
- Comcast Corp., Special Class A 26,600 1,084
- Consolidated Graphics, Inc. 1,400 15
- Cox Communications, Inc., Class A 16,735 737
- Crown Castle International Corp. 5,900 179
-+ CTC Communications Group, Inc. 550 5
- Cymer, Inc. 700 18
- Dick Clark Productions, Inc. 990 13
Dow Jones & Co., Inc. 2,800 165
- Drexler Technology Corp. 1,000 17
- EchoStar Communications Corp., Class A 6,700 303
- Efficient Networks, Inc. 1,600 67
- Emmis Communications Corp., Class A 1,000 27
- Entercom Communications Corp. 1,000 39
The E.W. Scripps Co., Class A 2,500 146
- Express Scripts, Inc., Class A 1,200 81
- Fox Entertainment Group, Inc., Class A 5,100 110
Gannett Co., Inc. 8,300 481
- Gaylord Entertainment Co. 800 19
- GC Cos., Inc. 500 1
Gray Communication Systems, Inc. 1,100 15
Gray Communication Systems, Inc., Class B 1,100 15
+ Grey Global Group, Inc. 200 112
Harte-Hanks Communications, Inc. 2,100 46
- Hispanic Broadcasting Corp. 3,200 100
Hollinger International, Inc. 3,200 49
Houghton Mifflin Co. 900 33
- IDG Books Worldwide, Inc., Class A 1,200 11
- Infinity Broadcasting Corp., Class A 11,475 382
- Information Holdings, Inc. 700 18
- Insight Communications Co. 1,300 18
- Intraware, Inc. 800 6
</TABLE>
98 See the Financial Notes, which
are integral to this information.
<PAGE> 103
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
John Wiley & Sons, Inc., Class A 1,800 37
- Journal Register Co. 1,200 21
Knight-Ridder, Inc. 4,300 216
Lee Enterprises, Inc. 1,300 36
- Liberty Digital, Inc., Class A 700 8
- Loews Cineplex Entertainment Corp. 900 1
Mail-Well, Inc. 1,300 6
- Maxwell Technologies, Inc. 1,000 16
McClatchy Co., Class A 1,200 46
McGraw-Hill Cos., Inc. 7,200 462
Media General, Inc., Class A 800 30
-+ Mediacom Communications Corp. 1,400 24
Meredith Corp. 1,900 60
- Metro-Goldwyn-Mayer, Inc. 6,017 118
- Metromedia International Group, Inc. 800 3
New York Times Co., Class A 6,100 224
- PanAmSat Corp. 400 13
Penton Media, Inc. 700 21
- Playboy Enterprises, Inc., Class B 700 9
- Price Communications Corp. 1,655 36
- Primedia, Inc. 8,300 94
-+ Pure Resources, Inc. 172 3
R.R. Donnelley & Sons Co. 4,400 95
-+ Radio Unica Communications Corp. 1,300 5
Reader's Digest Association, Inc., Class A 3,600 132
- Salem Communications Corp., Class A 1,600 19
- Scholastic Corp. 400 32
- Sinclair Broadcast Group, Inc., Class A 1,700 16
- The Source Information Management Co. 1,000 6
-+ Spanish Broadcasting System, Class A 700 6
Time Warner, Inc. 39,700 3,014
-+ TiVo, Inc. 900 12
Tribune Co. 10,200 378
United Television, Inc. 300 40
- UnitedGlobalCom, Inc., Class A 2,200 70
- USA Networks, Inc. 8,556 173
- Valassis Communications, Inc. 1,400 39
- Valuevision International, Inc., Class A 900 18
- Viacom, Inc., Class B 44,927 2,555
The Walt Disney Co. 62,500 2,238
Washington Post Co., Class B 300 160
- Westwood One, Inc. 3,200 61
-+ XM Satellite Radio Holdings, Inc., Class A 1,100 32
- Young Broadcasting, Inc., Class A 700 17
------
16,949
MISCELLANEOUS 1.1%
-------------------------------------------------------------------------
- 1-800-Flowers.com, Inc. 1,200 5
-+ Accelerated Networks, Inc. 1,400 20
-+ Aclara BioSciences, Inc. 1,100 20
-+ Acme Communications, Inc. 700 4
-+ Agilent Technologies, Inc. 13,417 621
-+ Alaska Communications Systems Group, Inc. 1,100 7
-+ Amdocs Ltd. 111 7
-+ ANC Rental Corp. 1,337 7
-+ AT&T Latin America Corp., Class A 600 4
- BioMarin Pharmaceuticals, Inc. 1,800 23
- Bluestone Software, Inc. 500 11
Boca Resorts, Inc., Class A 1,800 24
- Braun Consulting 600 5
-+ Breakaway Solutions, Inc. 1,400 8
-+ C-Bridge Internet Solutions, Inc. 600 9
-+ C-Cube Microsystems, Inc. 1,300 25
-+ Caldera Systems, Inc. 1,100 4
-+ Charles River Laboratories International, Inc. 900 24
-+ Choice One Communications, Inc. 900 10
+ CIRCOR International, Inc. 1,250 14
- Corinthian Colleges, Inc. 800 55
-+ Data Return Corp. 900 10
- Digital Island, Inc. 1,800 23
Ditech Communications Corp. 800 28
- E.piphany, Inc. 1,300 117
-+ Eloyalty Corp. 1,400 13
-+ EXE Technologies, Inc. 1,200 21
- Extreme Networks, Inc. 6,200 514
- Fairchild Semiconductor International, Inc., Class A 2,300 48
</TABLE>
See the Financial Notes, which 99
are integral to this information.
<PAGE> 104
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
-+ Finisar Corp. 4,800 138
-+ Frontline Capital Group 1,200 17
- Gabelli Asset Management, Inc., Class A 700 25
-+ Genuity, Inc. 5,600 31
-+ Globalnet Financial.com, Inc. 700 3
-+ Grant Prideco, Inc. 3,200 59
-+ Hain Celestial Group, Inc. 906 36
- Informatica Corp. 1,000 95
- InfoSpace, Inc. 8,520 171
-+ Interactive Intelligence, Inc. 700 26
- Intercept Group, Inc. 1,000 27
-+ Internet Capital Group, Inc. 800 11
-+ Intersil Holding Corp. 1,200 58
- ITT Educational Services, Inc. 1,000 16
-+ IXYS Corp. 600 15
+ Keithley Instruments, Inc. 400 21
- Keynote Systems, Inc. 700 17
-+ Lexent, Inc. 1,000 29
- Liquid Audio 700 3
- Mail.com, Inc. 1,600 5
-+ Management Network Group, Inc. 1,000 13
-+ Manufacturers Services Ltd. 900 9
-+ MCSi, Inc. 700 20
MicroFinancial, Inc. 1,400 14
-+ NaviSite, Inc. 1,600 16
-+ NetCreations, Inc. 500 4
- Network Access Solutions Corp. 1,100 3
-+ Network Commerce, Inc. 2,100 6
+ Neuberger Berman, Inc. 1,400 92
-+ Nuance Communications, Inc. 1,000 86
-+ Nucentrix Broadband Networks, Inc. 200 5
-+ OSI Pharmaceuticals, Inc. 800 58
-+ Pac-West Telecomm, Inc. 1,100 10
-+ Palm, Inc. 17,032 912
-+ Peco II, Inc. 600 24
-+ Pennaco Energy, Inc. 600 7
- Phone.com, Inc. 2,500 231
-+ Professional Detailing, Inc. 400 35
- Radio One, Inc., Class A 600 5
-+ Regent Communications, Inc. 900 5
-+ Rosetta Inpharmatics 900 20
-+ Rudolph Technologies, Inc. 500 20
- Sabre Holdings Corp. 3,701 124
-+ Sage, Inc. 700 9
- Sagent Technology, Inc. 1,500 4
Santander Bancorp. 1,100 17
-+ Silicon Image, Inc. 1,400 16
- Software Technologies Corp. 1,900 32
-+ Somera Communications, Inc. 1,900 21
- Spherion Corp. 1,830 22
- Stanford Microdevices, Inc. 700 18
-+ Stratos Lightwave, Inc. 1,800 48
-+ T/R Systems, Inc. 400 2
- Too, Inc. 742 17
-+ Travelocity.com, Inc. 300 4
-+ Trizetto Group, Inc. 900 18
-+ Troy Group, Inc. 500 3
- Tumbleweed Communications Corp. 800 14
+ United Parcel Service, Inc., Class B 3,200 194
- United Therapeutics Corp. 700 37
-+ Viador, Inc. 800 4
-+ Vicinity Corp. 900 9
Virginia Capital Bancshares, Inc. 1,100 18
- Vitria Technology, Inc. 3,700 99
W.P. Carey & Co. LLC 700 12
-+ Webex Communications, Inc. 1,000 45
-+ Williams Communications Group, Inc. 1,900 35
XCEL Energy, Inc. 9,995 255
-----
5,156
MISCELLANEOUS FINANCE 6.8%
-------------------------------------------------------------------------
1st Source Corp. 630 10
A.G. Edwards, Inc. 2,800 142
Advanta Corp., Class A 700 7
Advest Group, Inc. 700 23
- Affiliated Managers Group, Inc. 700 42
Alliance Capital Management Holding L.P. 6,100 293
Allied Capital Corp. 2,500 52
AMCORE Financial, Inc. 700 14
American Bank of Connecticut
Waterbury 600 12
+ American Capital Strategies Ltd. 500 11
American Express Co. 41,300 2,478
</TABLE>
100 See the Financial Notes, which
are integral to this information.
<PAGE> 105
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- AmeriCredit Corp. 2,200 59
- Ameritrade Holding Corp., Class A 4,900 72
Area Bancshares Corp. 500 10
Associates First Capital Corp., Class A 21,800 809
Astoria Financial Corp. 2,000 75
AXA Financial, Inc. 11,500 622
Bay View Capital Corp. 1,600 13
Bear Stearns Cos., Inc. 5,920 359
- Berkshire Hathaway, Inc., Class A 46 2,930
- BISYS Group, Inc. 1,800 85
- BOK Financial Corp. 1,427 27
BT Financial Corp. 725 14
Capital One Financial Corp. 6,900 436
CarrAmerica Realty Corp. 1,800 53
Cash America International, Inc. 1,300 7
Cathay Bancorp., Inc. 400 20
## Charles Schwab Corp. 41,420 1,455
Charter One Financial, Inc. 8,941 205
CIT Group, Inc., Class A 9,200 160
(7) Citigroup, Inc. 134,833 7,096
Coastal Bancorp, Inc. 800 14
Coastal Financial Corp. 924 10
Cohoes Bancorp. 1,200 20
Commercial Federal Corp. 1,300 23
- CompuCredit Corp. 1,400 43
Countrywide Credit Industries, Inc. 4,900 183
CVB Financial Corp. 625 10
Dain Rauscher Corp. 400 38
Dime Bancorp., Inc. 3,200 78
Downey Financial Corp. 800 38
- E*Trade Group, Inc. 9,935 145
Eaton Vance Corp. 1,100 55
-+ Espeed, Inc., Class A 200 4
Fannie Mae 30,200 2,325
Federated Investors, Inc., Class B 3,450 100
Fidelity Bancshares, Inc. 800 15
Fidelity National Financial, Inc. 1,700 42
- Financial Federal Corp. 800 17
+ First Financial Corp. 300 9
First Northern Capital Corp. 1,300 20
First Sentinel Bancorp., Inc. 1,500 14
Flagstar Bancorp., Inc. 1,000 13
Franklin Resources, Inc. 10,000 428
Freddie Mac 20,800 1,248
Golden State Bancorp, Inc. 3,600 94
Goldman Sachs Group, Inc. 4,100 409
Greater Bay Bancorp. 1,632 53
Heller Financial, Inc. 1,359 40
Household International, Inc. 14,200 714
Hudson River Bancorp. 1,600 22
Hugoton Royalty Trust 1,300 17
IndyMac Bancorp., Inc. 2,000 42
International Bancshares Corp. 562 20
- Investment Technology Group, Inc. 800 29
- Investors Financial Services Corp. 800 57
Jefferies Group, Inc. 800 22
John Nuveen Co., Class A 900 43
-+ JWGenesis Financial Corp. 1,041 10
-+ Knight Trading Group, Inc. 6,700 201
- LaBranche & Co., Inc. 1,400 55
Legg Mason, Inc. 2,200 114
Lehman Brothers Holdings, Inc. 7,800 503
MBNA Corp. 25,500 958
MDC Holdings, Inc. 1,000 27
Merrill Lynch & Co., Inc. 24,100 1,687
Mississippi Valley Bancshares 500 13
Morgan Keegan, Inc. 700 14
Morgan Stanley Dean Witter & Co. 33,700 2,707
- National Discount Broker Group, Inc. 600 29
- New Century Financial Corp. 1,700 20
- NextCard, Inc. 1,700 13
Northwest Bancorp., Inc. 1,500 11
- Ocwen Financial Corp. 2,920 17
- Orchid BioSciences, Inc. 900 18
Pacific Capital Bancorp. 700 19
Paine Webber Group, Inc. 5,000 356
- PBOC Holdings, Inc. 1,500 9
The Peoples Holding Co. 500 10
Phoenix Investment Partners Ltd. 1,600 25
Raymond James Financial, Inc. 1,300 44
</TABLE>
See the Financial Notes, which 101
are integral to this information.
<PAGE> 106
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Resource America, Inc., Class A 1,660 13
Siebert Financial Corp. 1,100 7
Southwest Securities Group 583 16
Sovereign Bancorp., Inc. 6,360 53
Staten Island Bancorp., Inc. 800 15
Student Loan Corp. 500 27
T. Rowe Price Associates, Inc. 4,700 220
TCF Financial Corp. 2,300 93
-+ TD Waterhouse Group, Inc. 1,200 20
Tucker Anthony Sutro 1,200 28
+ USA Education, Inc. 4,600 257
+ Value Line, Inc. 300 10
W Holding Co., Inc. 1,400 13
Waddell & Reed Financial, Inc.,
Class A 2,350 75
Washington Federal, Inc. 1,500 33
Washington Mutual, Inc. 16,177 712
Webster Financial Corp. 2,012 49
Wesco Financial Corp. 200 54
- WFS Financial, Inc. 900 14
World Acceptance Corp. 1,400 7
------
32,621
NON-FERROUS METALS 0.3%
-------------------------------------------------------------------------
Alcoa, Inc. 26,464 759
Commercial Metals Co. 500 14
Commonwealth Industries, Inc. 1,300 8
Engelhard Corp. 5,100 106
- Freeport-McMoRan Copper & Gold, Inc.,
Class B 4,200 33
IMCO Recycling, Inc. 1,400 8
- Kaiser Aluminum Corp. 2,000 10
- MAXXAM, Inc. 400 8
Minerals Technologies, Inc. 500 16
- Mueller Industries, Inc. 900 21
Phelps Dodge Corp. 3,430 160
Reliance Steel & Aluminum Co. 650 15
Southern Peru Copper Corp. 1,000 14
- Stillwater Mining Co. 1,100 32
- United Park City Mines 200 3
- Wolverine Tube, Inc. 700 10
------
1,217
OIL: DOMESTIC 0.8%
-------------------------------------------------------------------------
Amerada Hess Corp. 3,600 223
Ashland, Inc. 3,400 111
- Belco Oil & Gas Corp. 2,000 18
- CAL Dive International, Inc. 500 25
- Callon Petroleum Co. 1,100 17
Conoco, Inc., Class B 18,500 503
Consol Energy, Inc. 2,100 36
Cross Timbers Oil Co. 2,400 45
Diamond Offshore Drilling, Inc. 4,000 138
- Frontier Oil Corp. 2,000 16
- Global Industries Ltd. 2,500 26
- Gulf Island Fabrication, Inc. 1,300 17
- Houston Exploration Co. 700 16
+ Howell Corp. 600 7
- HS Resources, Inc. 800 25
Kerr-McGee Corp. 2,900 189
- Meridian Resource Corp. 1,600 11
Midcoast Energy Resources 700 14
Murphy Oil Corp. 1,500 87
- National-Oilwell, Inc. 2,369 69
- Newfield Exploration Co. 1,200 45
- Nuevo Energy Co. 800 15
- Ocean Energy, Inc. 4,800 67
Patina Oil & Gas Corp. 1,500 26
- Patterson Energy, Inc. 900 25
Pennzoil-Quaker State Co. 1,800 21
Phillips Petroleum Co. 7,600 469
- Pioneer Natural Resources Co. 2,600 34
Pogo Producing Co. 1,000 25
- Pride International, Inc. 1,900 48
- Remington Oil & Gas Corp. 400 4
St. Mary Land & Exploration Co. 1,200 28
- Stone Energy Corp. 500 26
Sunoco, Inc. 3,000 90
- Superior Energy Services 1,900 17
- Syntroleum Corp. 1,500 29
Teppco Partners L.P. 1,000 23
- Tesoro Petroleum Corp. 1,300 13
Tosco Corp. 4,600 132
- TransMontaigne, Inc. 1,600 6
</TABLE>
102 See the Financial Notes, which
are integral to this information.
<PAGE> 107
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Transocean Sedco Forex, Inc. 6,881 365
Ultramar Diamond Shamrock Corp. 2,500 66
Unocal Corp. 7,400 253
USX-Marathon Group, Inc. 9,400 256
Vintage Petroleum, Inc. 1,800 38
------
3,714
OIL: INTERNATIONAL 2.5%
-------------------------------------------------------------------------
Chevron Corp. 19,500 1,601
(4)Exxon Mobil Corp. 104,358 9,307
Santa Fe International Corp. 3,500 128
Texaco, Inc. 16,500 975
------
12,011
OPTICAL & PHOTO 0.1%
-------------------------------------------------------------------------
CPI Corp. 400 8
Eastman Kodak Co. 9,300 417
- Ingram Micro, Inc., Class A 1,800 31
Meade Instruments Corp. 800 15
Polaroid Corp. 3,800 38
-+ Robotic Vision Systems, Inc. 1,000 5
- Zomax, Inc. 2,000 12
-+ Zygo Corp. 500 25
------
551
PAPER & FOREST PRODUCTS 0.7%
-------------------------------------------------------------------------
Boise Cascade Corp. 2,300 66
Bowater, Inc. 1,600 87
- Buckeye Technologies, Inc. 800 14
Caraustar Industries, Inc. 700 7
Chesapeake Corp. 500 10
- CSS Industries, Inc. 600 12
-+ Fibermark, Inc. 300 2
Fort James Corp. 6,300 208
Georgia-Pacific Corp. (Timber Group) 2,300 65
Georgia-Pacific Group 5,700 153
International Paper Co. 14,204 520
Kimberly-Clark Corp. 16,139 1,065
Longview Fibre Co. 1,200 16
Louisiana-Pacific Corp. 2,900 25
- Lydall, Inc. 1,400 15
Mead Corp. 2,900 84
Pentair, Inc. 1,400 42
PH Glatfelter Co. 2,800 29
+ Pope & Talbot, Inc. 500 8
Potlatch Corp. 800 27
Rayonier, Inc. 800 28
Rock Tennessee Co., Class A 1,000 9
Smurfit-Stone Container Corp. 6,100 82
Temple-Inland, Inc. 1,900 85
- Thermo Fibertek, Inc. 1,500 6
Universal Forest Products, Inc. 800 11
Wausau Mosinee Paper Corp. 1,100 10
Westvaco Corp. 2,800 80
Weyerhaeuser Co. 7,600 357
Willamette Industries, Inc. 3,300 120
------
3,243
PRODUCER GOODS & MANUFACTURING 5.9%
-------------------------------------------------------------------------
Actuant Corp., Class A 1,100 4
- Advanced Energy Industries, Inc. 900 16
-+ Aeroflex, Inc. 900 54
AGCO Corp. 1,700 19
- Albany International Corp., Class A 918 10
- Alltrista Corp. 200 2
- American Standard Cos. 2,800 128
Ametek, Inc. 900 20
Applied Industrial Technologies, Inc. 900 15
- Applied Micro Circuits Corp. 8,838 676
AptarGroup, Inc. 900 19
- Arcade Financial Technologies, Inc. 1,000 23
- Astec Industries, Inc. 500 5
Avery Dennison Corp. 3,300 167
-+ Axcelis Technologies, Inc. 2,800 30
Baldor Electric, Co. 800 16
Barnes Group, Inc. 700 13
- BE Aerospace, Inc. 1,100 18
- Blount International, Inc. 1,200 10
- Blyth, Inc. 1,300 34
Briggs & Stratton Corp. 1,500 54
-+ Capstone Turbine Corp. 2,300 128
Caterpillar, Inc. 10,200 358
CLARCOR, Inc. 700 13
</TABLE>
See the Financial Notes, which 103
are integral to this information.
<PAGE> 108
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Cognex Corp. 1,200 40
Columbus Mckinnon Corp. 500 7
Cooper Industries, Inc. 6,000 230
Corning, Inc. 26,457 2,024
- Cuno, Inc. 600 15
Curtiss-Wright Corp. 400 19
-+ Cyber-Care, Inc. 900 4
Deere & Co. 7,400 272
- Diamond Technology Partners, Inc. 600 27
Dover Corp. 7,300 310
-+ Elantec Semiconductor, Inc. 600 67
Emerson Electric Co. 12,900 947
-+ Encompass Services Corp. 2,525 12
- The Fairchild Corp., Class A 1,400 8
Federal Signal Corp. 1,300 30
- Fisher Scientific International 1,200 46
- Flowserve Corp. 1,100 22
- FMC Corp. 900 68
Foster Wheeler Corp. 1,200 9
Franklin Electric Co., Inc. 200 14
#(1) General Electric Co. 295,556 16,200
Graco, Inc. 500 18
- Hanover Compressor Co. 1,600 52
-+ Harbor Global Co. Ltd. 160 1
Hardinge, Inc. 800 9
Harsco Corp. 1,000 20
Helix Technology Corp. 600 17
Herman Miller, Inc. 2,200 57
Hexcel Corp. 1,500 16
HON Industries, Inc. 1,600 39
Honeywell International, Inc. 24,162 1,300
Hubbell, Inc., Class B 1,800 43
Hughes Supply, Inc. 500 9
-+ Ibis Technology Corp. 200 8
IDEX Corp. 800 26
Illinois Tool Works, Inc. 9,150 508
Ingersoll-Rand Co. 5,700 215
- Ionics, Inc. 400 8
- Jabil Circuit, Inc. 5,800 331
JLG Industries, Inc. 1,300 18
Johnson Controls, Inc. 2,600 155
Kaydon Corp. 800 18
Kennametal, Inc. 800 24
- Lattice Semiconductor Corp. 3,200 93
Lennox International, Inc. 1,971 16
Libbey, Inc. 500 14
Lincoln Electric Holdings, Inc. 1,000 17
- Lone Star Technologies, Inc. 1,000 40
- Magnatek, Inc. 1,500 16
Manitowoc Co., Inc. 600 16
- Marine Drilling Co., Inc. 1,600 38
MascoTech, Inc. 1,100 18
- Mastec, Inc. 1,350 39
- Material Sciences Corp. 800 8
Matthews International Corp., Class A 700 19
- Maverick Tube Corp. 1,000 16
-+ McData Corp., Class B 700 58
Metals USA, Inc. 1,000 3
- Micrel, Inc. 2,800 127
Milacron, Inc. 1,100 18
Millipore Corp. 1,400 74
Minnesota Mining & Manufacturing Co. 11,500 1,111
- MSC Industrial Direct Co., Class A 1,000 15
Nacco Industries, Inc., Class A 300 11
Nordson Corp. 1,000 29
- Nortek, Inc. 500 9
- Oceaneering International, Inc. 800 11
Pall Corp. 3,500 75
- Park Ohio Holdings Corp. 1,100 8
Parker-Hannifin Corp. 3,400 141
Penn Engineering & Manufacturing Corp. 500 19
Pitt-Des Moines, Inc. 500 16
-+ Plug Power, Inc. 1,300 31
-+ PMC Sierra, Inc. 308 52
Precision Castparts Corp. 1,600 60
-+ Presstek, Inc. 700 11
Primex Technologies, Inc. 500 15
- Rare Medium Group, Inc. 1,100 5
Regal Beloit 500 8
- Research Frontiers, Inc. 800 15
Roper Industries, Inc. 800 28
- Safeguard Scientifics, Inc. 3,300 51
Sauer-Danfoss, Inc. 1,100 8
</TABLE>
104 See the Financial Notes, which
are integral to this information.
<PAGE> 109
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Scott Technologies, Inc. 700 16
- Shaw Group, Inc. 500 41
Snap-On, Inc. 2,000 51
- SPS Technologies, Inc. 500 26
- Standex International Corp. 500 9
Steelcase, Inc., Class A 1,000 18
Stewart & Stevenson Services 1,000 24
- Strattec Security Corp. 300 10
Tecumseh Products Co., Class A 500 20
Teleflex, Inc. 1,100 38
Tennant Co. 600 26
+ Tenneco Automotive, Inc. 1,980 9
- Terex Corp. 700 9
The Timken Co. 2,500 35
Trinity Industries, Inc. 1,100 26
U.S. Industries, Inc. 2,000 18
- UCAR International, Inc. 1,300 11
- Ultratech Stepper, Inc. 800 19
-+ Uniroyal Technology Corp. 600 6
Valhi, Inc. 3,300 41
Valmont Industries, Inc. 900 18
W.W. Grainger, Inc. 2,700 86
Watsco, Inc. 900 8
Watts Industries, Inc., Class A 1,000 11
- WMS Industries, Inc. 1,000 22
Woodward Governor Co. 500 22
X-Rite, Inc. 2,000 14
York International Corp. 1,100 30
- Zebra Technologies Corp., Class A 1,000 44
------
28,162
RAILROAD & SHIPPING 0.3%
-------------------------------------------------------------------------
Alexander & Baldwin, Inc. 1,000 25
Burlington Northern Santa Fe Corp. 13,100 348
CSX Corp. 6,700 170
Florida East Coast Industries, Inc., Class A 1,100 39
GATX Corp. 1,500 63
Greenbrier Cos., Inc. 1,600 14
-+ Gulfmark Offshore, Inc. 300 9
-+ Kansas City Southern Industries, Inc. 1,550 13
Newport News Shipbuilding, Inc. 900 44
Norfolk Southern Corp. 11,900 168
Overseas Shipholding Group, Inc. 1,000 24
-+ Railamerica, Inc. 866 7
- Transport Corp. of America 1,100 6
Union Pacific Corp. 7,300 342
- Wisconsin Central Transportation Corp. 1,200 15
------
1,287
REAL PROPERTY 0.8%
-------------------------------------------------------------------------
Alexandria Real Estate Equities, Inc. 500 17
AMB Property Corp. 2,300 54
- American Real Estate Partners L.P. 1,300 12
-+ American Realty Investors, Inc. 637 9
- American Retirement Corp. 700 4
+ AMLI Residential Properties 500 12
Amresco Capital Trust, Inc. 1,300 13
Apartment Investment & Management Co. 2,000 91
Archstone Communities Trust 3,900 92
Arden Realty, Inc. 1,700 41
AvalonBay Communities, Inc. 1,900 87
- Avatar Holdings, Inc. 700 13
Bedford Property Investors 900 18
Boston Properties, Inc. 2,200 89
Brandywine Realty Trust 1,000 19
BRE Properties, Class A 1,200 38
Burnham Pacific Property, Inc. 1,500 8
Cabot Industrial Trust 1,200 23
Camden Property Trust 1,000 29
Capstead Mortgage Corp. 650 6
- Catellus Development Corp. 3,200 58
- CB Richard Ellis Services, Inc. 1,100 14
CBL & Associates Properties 700 16
Center Trust, Inc. 1,400 8
Centerpoint Properties Corp. 500 22
Charles E. Smith Residential 600 26
Chateau Communities, Inc. 800 23
Chelsea GCA Realty, Inc. 500 16
Colonial Properties Trust 500 12
+ Commercial Net Lease Realty 1,000 10
Cornerstone Realty Income Trust 1,200 13
</TABLE>
See the Financial Notes, which 105
are integral to this information.
<PAGE> 110
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Correctional Properties Trust 1,100 11
Cousins Properties, Inc. 1,500 39
Crescent Real Estate Equity Co. 3,200 64
Developers Diversified Realty Corp. 1,600 19
Duke-Weeks Realty Corp. 3,590 85
Eastgroup Properties 700 14
Equity Inns, Inc. 1,900 12
Equity Office Properties Trust 9,048 273
Equity One, Inc. 1,100 10
Equity Residential Properties Trust 4,000 188
Essex Property Trust, Inc. 600 31
+ Excel Legacy Corp. 363 1
- Fairfield Communities, Inc. 1,000 13
Federal Realty Investment Trust 1,200 23
FelCor Lodging Trust, Inc. 1,700 37
First Industrial Realty Trust 1,100 34
First Washington Realty Trust 600 15
Forest City Enterprises, Inc., Class A 800 30
Franchise Finance Corp. of America REIT 1,400 28
Gables Residential Trust 500 13
General Growth Properties 1,500 44
Getty Realty Corp. 1,000 10
Glenborough Realty Trust, Inc. 900 14
Glimcher Realty Trust 800 10
Golf Trust of America L.P. 900 10
Grove Property Trust 1,000 17
Health Care Property Investors, Inc. 1,424 42
Health Care Real Estate Investment Trust, Inc. 700 12
Healthcare Realty Trust, Inc. 1,200 24
Highwoods Properties, Inc. 1,800 39
Home Properties of NY, Inc. 500 14
Hospitality Properties Trust 1,500 32
HRPT Properties Trust 3,400 22
Innkeepers USA Trust 1,500 15
IRT Property Co. 1,600 13
iStar Financial, Inc. 2,290 46
JDN Realty Corp. 1,300 14
- Jones Lang LaSalle, Inc. 1,100 14
JP Realty, Inc. 700 11
Keystone Property Trust 900 12
Kilroy Realty Corp. 800 21
Kimco Realty Corp. 1,700 68
Koger Equity, Inc. 700 11
+ Konover Property Trust, Inc. 1,600 7
+ Kramont Realty Trust 1,400 13
Liberty Property Trust 2,000 53
LNR Property Corp. 700 15
LTC Properties, Inc. 1,800 6
The Macerich Co. 900 18
Mack-Cali Realty Corp. 1,600 43
Manufactured Home Communities 500 12
Mid-America Apartment Communities, Inc. 500 11
Mills Corp. 700 12
National Golf Properties, Inc. 800 16
National Health Investors, Inc. 700 4
Nationwide Health Properties, Inc. 1,100 16
New Plan Excel Realty Trust 2,300 28
Newhall Land & Farming Co. L.P. 800 19
- Omega Healthcare Investors 1,000 6
Pacific Gulf Properties, Inc. 800 21
Pan Pacific Retail Properties, Inc. 900 18
Parkway Properties, Inc. 500 14
- Pinnacle Holdings, Inc. 1,300 20
PMC Commercial Trust 1,000 10
Post Properties, Inc. 1,200 42
Prentiss Properties Trust 1,100 28
Prologis Trust 4,900 103
PS Business Parks, Inc. 500 13
Public Storage, Inc. 3,700 83
Realty Income Corp. 800 18
Reckson Associates Realty 1,200 27
Regency Realty Corp. 1,700 38
RFS Hotel Investors, Inc. 1,100 14
Rouse Co. 2,000 49
+ Saul Centers, Inc. 600 9
- Security Capital Group, Inc., Class B 1,300 25
Senior Housing Properties Trust 950 9
</TABLE>
106 See the Financial Notes, which
are integral to this information.
<PAGE> 111
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Shurgard Storage Centers, Inc., Class A 600 14
Simon Property Group, Inc. 5,000 112
SL Green Realty Corp. 700 19
Sovran Self Storage, Inc. 800 15
Spieker Properties, Inc. 2,000 111
The St. Joe Co. 2,400 48
Starwood Hotels & Resorts Worldwide, Inc. 5,680 168
Storage USA, Inc. 800 22
Summit Properties, Inc. 600 14
Sun Communities, Inc. 500 15
Tanger Factory Outlet Centers 800 17
Taragon Realty Investors, Inc. 1,300 16
Taubman Centers, Inc. 1,600 18
- Trammell Crow Co. 1,300 17
United Dominion Realty Trust 2,600 27
Universal Health Realty Income 900 16
Vornado Realty Trust 2,500 87
Washington Real Estate Investment Trust 1,100 22
Weingarten Realty Investment 800 34
Westfield America, Inc. 2,200 31
------
3,991
RETAIL 4.5%
-------------------------------------------------------------------------
-+ 7-Eleven, Inc. 2,900 31
- 99 Cents Only Stores 1,000 22
Albertson's, Inc. 14,168 336
-+ Alloy Online, Inc. 200 2
- Amazon.com, Inc. 10,500 385
- American Eagle Outfitters, Inc. 1,100 38
- AnnTaylor Stores Corp. 800 24
- AutoZone, Inc. 8,900 239
- Barnes & Noble, Inc. 1,600 30
- Bed, Bath & Beyond, Inc. 8,000 207
- Best Buy Co., Inc. 6,000 301
- BJ's Wholesale Club, Inc. 2,100 69
- Borders Group, Inc. 1,800 25
Burlington Coat Factory Warehouse Corp. 1,200 19
Casey's General Stores, Inc. 1,100 14
The Cato Corp., Class A 1,200 14
- Central Garden & Pet Co. 1,700 13
- Charming Shoppes, Inc. 2,000 12
Circuit City Stores--Circuit City Group 6,500 86
Claire's Stores, Inc. 1,200 24
- Coldwater Creek, Inc. 700 21
- Consolidated Stores Corp. 3,500 42
- Cost Plus, Inc. 700 20
- Costco Wholesale Corp. 13,000 476
CVS Corp. 11,700 619
DEB Shops, Inc. 700 8
Delhaize America, Inc. 4,747 81
Dillards, Inc., Class A 4,000 42
Dollar General Corp. 10,375 161
- Dollar Tree Stores, Inc. 3,550 139
- Duane Reade, Inc. 500 15
Enesco Group, Inc. 1,100 7
-+ Etoys, Inc. 3,500 13
Family Dollar Stores, Inc. 5,300 103
- Federated Department Stores, Inc. 6,700 218
-+ Gadzooks, Inc. 600 11
Gap, Inc. 24,800 640
- Gottschalks, Inc. 1,800 9
Great Atlantic & Pacific Tea Co., Inc. 800 8
- Greg Manning Auctions, Inc. 800 4
- Guitar Center, Inc. 1,100 15
Home Depot, Inc. 69,100 2,971
-+ HOT Topic, Inc. 400 14
- Insight Enterprises, Inc. 1,050 34
- Intertan, Inc. 1,050 12
Intimate Brands, Inc. 14,240 340
J.C. Penney Co., Inc. 8,800 103
- Kmart Corp. 13,200 78
- Kohl's Corp. 9,700 526
- Kroger Co. 24,400 551
- Lands' End, Inc. 800 21
+ Lillian Vernon Corp. 500 5
Limited, Inc. 14,400 364
Longs Drug Stores, Inc. 1,800 39
Lowe's Cos., Inc. 11,700 535
May Department Stores Co. 10,400 273
- Michaels Stores, Inc. 1,000 24
- The Neiman Marcus Group, Inc., Class A 1,100 41
</TABLE>
See the Financial Notes, which 107
are integral to this information.
<PAGE> 112
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- The Neiman Marcus Group, Inc., Class B 451 16
Nordstrom, Inc. 4,200 69
- Office Depot, Inc. 9,600 80
- OfficeMax, Inc. 2,700 8
- Payless Shoesource, Inc. 602 35
-+ PC Connection, Inc. 600 16
Pep Boys -- Manny, Moe, & Jack 1,600 7
Pier 1 Imports, Inc. 2,000 27
-+ Pricesmart, Inc. 200 7
RadioShack Corp. 5,600 334
Ross Stores, Inc. 2,100 28
Ruddick Corp. 900 12
- Safeway, Inc. 14,900 815
- Saks, Inc. 3,200 33
- School Specialty, Inc. 1,100 17
Sears, Roebuck & Co. 10,600 315
-+ Sharper Image Corp. 1,200 23
- ShopKo Stores, Inc. 600 4
Spiegel, Inc., Class A 2,700 19
- Staples, Inc. 14,700 209
- Stein Mart, Inc. 2,300 36
- Sunglass HUT International, Inc. 1,500 12
Target Corp. 27,200 751
Tiffany & Co., Inc. 4,200 179
TJX Cos., Inc. 8,500 232
- Toys 'R' Us, Inc. 7,900 136
- Tractor Supply Co. 700 6
- Tuesday Morning Corp. 1,100 5
Unifirst Corp. 900 9
- United Stationers, Inc. 900 27
- Value City Department Stores, Inc. 700 6
- Venator Group, Inc. 3,900 55
(10) Wal-Mart Stores, Inc. 133,800 6,071
Walgreen Co. 30,100 1,373
Weis Markets, Inc. 1,000 37
- West Marine, Inc. 1,200 9
- Whitehall Jewellers, Inc. 600 5
- Williams-Sonoma, Inc. 1,600 33
Winn-Dixie Stores, Inc. 4,000 77
- Zale Corp. 900 30
------
21,637
STEEL 0.1%
-------------------------------------------------------------------------
AK Steel Holding Corp. 3,027 28
Allegheny Technologies, Inc. 3,150 64
- Atchison Casting Corp. 900 3
- Bethlehem Steel Corp. 2,884 8
Carpenter Technology Corp. 900 28
Cleveland-Cliffs, Inc. 700 14
- Gibraltar Steel Corp. 600 8
Intermet Corp. 1,100 8
National Steel Corp., Class B 2,400 7
- NS Group, Inc. 1,200 10
Nucor Corp. 2,500 87
Quanex Corp. 800 16
Roanoke Electric Steel Corp. 800 8
Ryerson Tull, Inc. 1,000 8
- Steel Dynamics, Inc. 1,200 14
Steel Technologies, Inc. 700 4
USX-U.S. Steel Group, Inc. 2,400 38
Worthington Industries, Inc. 2,200 21
------
374
TELEPHONE 5.9%
-------------------------------------------------------------------------
- Adtran, Inc. 1,600 61
-+ Airgate PCS, Inc. 300 12
*+ Alcatel SA 638 40
- Allegiance Telecom, Inc. 3,050 96
Alltel Corp. 9,435 608
- Arch Wireless, Inc. 500 2
AT&T Corp. 113,606 2,634
-+ AT&T Corp. -- Liberty Media Group, Class A 1,206 22
- Autobytel.com, Inc. 1,800 10
-+ Avaya, Inc. 8,585 115
BellSouth Corp. 57,000 2,754
- Boston Communications Group 1,300 31
- Broadwing, Inc. 6,368 180
- Carrier Access Corp. 600 8
- Centennial Communications Corp. 2,400 47
-+ Centillium Communications, Inc. 1,000 38
CenturyTel, Inc. 6,000 231
CFW Communication Co. 500 10
- Citizens Communications Co. 7,500 109
- Commonwealth Telephone Enterprises, Inc. 500 17
</TABLE>
108 See the Financial Notes, which
are integral to this information.
<PAGE> 113
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Conestoga Enterprise, Inc. 700 13
- Copper Mountain Networks, Inc. 1,400 16
- Covad Communications Group, Inc. 4,450 24
CT Communications, Inc. 1,000 20
D & E Communications, Inc. 700 17
-+ Dobson Communications Corp., Class A 2,600 34
-+ Equinix, Inc. 2,100 20
- Exodus Communications, Inc. 12,600 423
- Focal Communications Corp. 1,600 23
- General Communication, Inc., Class A 500 4
- Global Crossing Ltd. 8,164 193
- Globix Corp. 1,000 10
-+ Goamerica, Inc. 1,800 19
Hickory Tech Corp. 1,100 25
-+ Illuminet Holdings, Inc. 800 19
- Inet Technologies, Inc. 1,300 53
Inter-Tel, Inc. 600 7
- Interdigital Communications Corp. 1,400 15
- Intermedia Communications, Inc. 3,000 66
ITC DeltaCom, Inc. 1,500 12
-+ ITXC Corp. 1,100 12
- Leap Wireless International, Inc. 800 40
- Level 3 Communications, Inc. 10,900 520
-+ Lexar Media, Inc. 1,400 10
-+ Lexicon Genetics, Inc. 1,300 26
- McLeodUSA, Inc., Class A 17,144 330
-+ Metrocall, Inc. 1,000 1
- Motient Corp. 1,200 15
- Nanometrics, Inc. 300 7
- Neon Communications, Inc. 500 6
- Net2Phone, Inc. 600 11
- Network Plus Corp. 1,400 11
-+ Next Level Communications, Inc. 2,400 112
North Pittsburgh Systems, Inc. 1,000 12
- NorthPoint Communications Group, Inc. 3,700 25
- NTL, Inc. 7,394 325
- Optical Cable Corp. 1,800 29
- Pegasus Communications Corp. 1,300 46
- Powertel, Inc. 1,000 87
- Primus Telecommunications Group, Inc. 900 5
- Qwest Communications International, Inc. 49,837 2,423
- RCN Corp. 2,300 41
SBC Communications, Inc. 102,862 5,934
-+ Spectrasite Holdings, Inc. 3,900 77
Sprint Corp. (FON Group) 26,300 671
- Sprint Corp. (PCS Group) 27,700 1,056
-+ StorageNetworks, Inc. 800 51
-+ Tanox, Inc. 1,200 45
Telephone & Data Systems, Inc. 1,900 200
- Teligent, Inc., Class A 1,000 8
- Time Warner Telecom, Inc., Class A 900 54
-+ Tripath Technology, Inc. 800 23
-+ Tritel, Inc. 2,800 39
- Triton PCS Holdings, Inc., Class A 1,500 70
-+ Turnstone Systems, Inc. 400 9
- Tut Systems, Inc. 500 17
- U.S. Cellular Corp. 2,500 160
-+ U.S. Wireless Corp. 400 6
- US LEC Corp., Class A 500 3
- Varco International, Inc. 2,740 47
+ Verizon Communications 82,612 4,776
- Viatel, Inc. 1,311 13
- VoiceStream Wireless Corp. 5,861 771
- WebLink Wireless, Inc. 1,100 9
- West Teleservices Corp. 1,700 43
- Westell Technologies, Inc., Class A 2,560 14
- Winstar Communications, Inc. 2,550 50
-+ WJ Communications, Inc. 1,600 24
- World Access, Inc. 1,600 8
- Worldcom, Inc. 86,449 2,053
- WorldPort Communications, Inc. 600 3
-+ Z-Tel Technologies, Inc. 900 8
------
28,374
</TABLE>
See the Financial Notes, which 109
are integral to this information.
<PAGE> 114
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
TOBACCO 0.6%
-------------------------------------------------------------------------
Philip Morris Cos., Inc. 68,700 2,516
R.J. Reynolds Tobacco Holdings, Inc. 2,966 106
Schweitzer-Mauduit International, Inc. 900 15
Universal Corp. 800 22
UST, Inc. 4,700 119
-------
2,778
TRAVEL & RECREATION 0.4%
-------------------------------------------------------------------------
- AMERCO, Inc. 900 18
- American Classic Voyager Co. 600 8
- Anchor Gaming, Inc. 500 42
- Argosy Gaming Co. 1,100 18
-+ Autotote Corp., Class A 700 2
- Avis Group Holdings, Inc. 800 24
- Aztar Corp. 1,400 21
- Bally Total Fitness Holding Corp. 1,300 32
Brunswick Corp. 3,700 72
Callaway Golf Co. 2,000 32
Carnival Corp. 18,200 452
Central Parking Corp. 900 17
- Choice Hotels International, Inc. 1,900 22
- Crestline Capital Corp. 800 17
- Dollar Thrifty Automotive Group, Inc. 1,000 15
-+ Expedia, Inc., Class A 1,000 13
- Extended Stay America, Inc. 2,600 32
- Harrah's Entertainment, Inc. 3,700 106
Hertz Corp., Class A 1,200 39
Hilton Hotels Corp. 11,026 105
Host Marriott Corp. 6,300 67
-+ Intranet Solutions, Inc. 600 28
- Mandalay Resort Group 2,400 50
Marriott International, Inc., Class A 7,400 300
Meristar Hospitality Corp. 1,200 23
MGM Mirage, Inc. 4,700 162
- Navigant International, Inc. 1,300 13
- Park Place Entertainment Corp. 9,800 125
- Pinnacle Entertainment, Inc. 700 16
- Prime Hospitality Corp. 1,800 17
- Rent-Way, Inc. 700 4
- ResortQuest International, Inc. 1,900 12
Royal Caribbean Cruises Ltd. 5,400 122
- Sodexho Marriott Services, Inc. 1,700 31
- Speedway Motorsports, Inc. 1,000 17
- Station Casinos, Inc. 1,650 27
- Suburban Lodges of America 2,200 15
- Sunburst Hospitality Corp. 1,600 11
- Trendwest Resorts, Inc. 700 13
- Vail Resorts, Inc. 800 17
-------
2,157
TRUCKING & FREIGHT 0.1%
-------------------------------------------------------------------------
- American Freightways Corp. 1,000 16
- Arkansas Best Corp. 1,100 18
C.H. Robinson Worldwide, Inc. 1,200 66
CNF Transportation, Inc. 1,300 35
- Consolidated Freightways Corp. 2,200 9
Expeditores International of Washington, Inc. 1,500 78
- Forward Air Corp. 600 25
- Fritz Cos., Inc. 1,300 11
- Heartland Express, Inc. 1,000 17
- HUB Group, Inc., Class A 700 6
J.B. Hunt Transport Services, Inc. 1,000 13
- Knight Transportation, Inc. 800 13
- Landstar Systems, Inc. 400 19
- M.S. Carriers, Inc. 600 9
- OLD Dominion Freight Line 1,200 11
PACCAR, Inc. 2,400 101
Roadway Express, Inc. 600 12
Rollins Truck Leasing Corp. 1,500 8
Ryder Systems, Inc. 1,600 32
- Swift Transportation Co., Inc. 1,600 23
USFreightways Corp. 600 15
Wabash National Corp. 1,100 9
Werner Enterprises, Inc. 1,200 17
- XTRA Corp. 300 14
- Yellow Corp. 700 13
------
590
</TABLE>
110 See the Financial Notes, which
are integral to this information.
<PAGE> 115
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
UTILITIES: ELECTRIC & GAS 3.2%
-------------------------------------------------------------------------
- AES Corp. 13,400 757
AGL Resources, Inc. 1,200 24
Allegheny Energy, Inc. 3,900 160
Allete 1,700 37
Alliant Energy Corp. 2,300 70
Ameren Corp. 4,900 195
American Electric Power Co., Inc. 11,420 474
+ American States Water Co. 500 16
American Water Works Co., Inc. 3,000 73
Atmos Energy Corp. 700 16
-+ Atrion Corp. 300 3
Avista Corp. 1,200 27
Bangor Hydro-Electric Co. 900 22
-+ Baycorp Holdings Ltd. 200 2
+ Birmingham Utilities, Inc. 300 4
Black Hills Corp. 500 16
CP&L Energy, Inc. 4,761 192
California Water Service Group 500 13
- Calpine Corp. 4,000 316
+ Cascade Natural Gas Corp. 500 9
+ Central Vermont Public Service Corp. 300 3
CH Energy Group, Inc. 400 16
Cinergy Corp. 4,700 144
Cleco Corp. 600 29
CMS Energy Corp. 4,000 108
Coastal Corp. 6,700 505
Columbia Energy Group 2,500 180
Conectiv, Inc. 2,400 43
Connecticut Water Services, Inc. 500 15
Consolidated Edison, Inc. 6,100 215
Constellation Energy Group, Inc. 4,800 200
+ Delta Natural Gas Co., Inc. 200 3
Dominion Resources, Inc. 8,098 482
DPL, Inc. 3,152 89
DQE, Inc. 2,400 84
DTE Energy Co. 4,200 152
Duke Energy Corp. 10,800 934
+ Dynegy, Inc., Class A 9,162 424
E'Town Corp. 300 20
Edison International 10,400 248
- El Paso Electric Co. 1,600 19
El Paso Energy Corp. 7,400 464
Empire District Electric Co. 700 19
Energen Corp. 700 20
Energy East Corp. 4,694 95
+ EnergyNorth, Inc. 200 12
EnergySouth, Inc. 800 17
Enron Corp. 21,800 1,789
Entergy Corp. 6,800 261
Equitable Resources, Inc. 900 52
FirstEnergy Corp. 7,100 184
Florida Progress Corp. 2,900 154
+ Florida Public Utilities Co. 200 3
FPL Group, Inc. 6,000 396
GPU, Inc. 3,500 116
+ Green Mountain Power Corp. 400 3
Hawaiian Electric Industries, Inc. 700 23
Idacorp, Inc. 1,000 49
Ipalco Enterprises, Inc. 2,000 45
Kansas City Power & Light Co. 1,600 39
KeySpan Corp. 4,000 141
Kinder Morgan, Inc. 4,000 154
Laclede Gas Co. 600 13
LG&E Energy Corp. 4,100 101
Madison Gas & Electric Co. 800 17
+ Maine Public Service Co. 200 5
MCN Energy Group, Inc. 2,200 54
MDU Resources Group, Inc. 1,300 38
Montana Power Co. 3,900 110
National Fuel Gas Co. 1,200 64
New Jersey Resources Corp. 400 16
- Niagara Mohawk Holdings, Inc. 5,100 82
NICOR, Inc. 1,200 42
NiSource, Inc. 3,900 97
Northeast Utilities 4,624 94
Northwest Natural Gas Co. 700 16
Northwestern Corp. 1,400 31
NSTAR 1,667 64
+ NUI Corp. 500 16
OGE Energy Corp. 2,000 41
ONEOK, Inc. 1,200 48
</TABLE>
See the Financial Notes, which 111
are integral to this information.
<PAGE> 116
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
Otter Tail Power Co. 600 13
Peoples Energy Corp. 1,700 58
PG&E Corp. 11,400 307
Philadelphia Suburban Corp. 1,000 23
Piedmont Natural Gas Co., Inc. 800 24
Pinnacle West Capital Corp. 3,600 156
Potomac Electric Power Co. 3,800 87
PPL Corp. 4,800 198
Public Service Co. of New
Mexico 2,000 55
Public Service Enterprise Group, Inc. 6,400 266
Puget Sound Energy, Inc. 2,200 54
Questar Corp. 2,100 57
Reliant Energy, Inc. 9,200 380
- Republic Services, Inc. 5,100 69
RGS Energy Group, Inc. 700 21
Scana Corp. 3,405 90
Sempra Energy 5,775 119
Sierra Pacific Resources 1,776 31
SJW Corp. 100 12
South Jersey Industries 500 15
Southern Co. 19,100 561
- Southern Union Co. 1,076 20
Southwest Gas Corp. 700 15
+ St. Joseph Light & Power 200 4
Teco Energy, Inc. 3,800 106
TXU Corp. 8,400 311
-+ U.S. Energy Systems, Inc. 600 3
UGI Corp. 700 16
UIL Holdings Corp. 500 23
Unisource Energy Corp. Holding Co. 900 13
UtiliCorp United, Inc. 2,600 69
Vectren Corp. 1,466 34
- Veritas DGC, Inc. 800 24
Washington Gas Light Co. 1,100 28
- Waste Connections, Inc. 1,000 26
Western Resources, Inc. 1,600 34
Williams Cos., Inc. 13,100 548
Wisconsin Energy Corp. 3,500 66
WPS Resources Corp. 700 23
------
15,283
</TABLE>
<TABLE>
OTHER INVESTMENT COMPANIES
1.0% of investments
<S> <C>
Provident Institutional
TempFund 4,716,844 4,717
</TABLE>
<TABLE>
U.S. TREASURY OBLIGATIONS
0.0% of investments
<CAPTION>
SECURITY FACE VALUE MKT. VALUE
RATE, MATURITY DATE ($ x 1,000) ($ x 1,000)
<S> <C> <C>
# U.S. Treasury Bills
5.97%-6.02%, 12/14/00 245 243
</TABLE>
-------------------------------------------------------------------------------
END OF PORTFOLIO HOLDINGS. For totals, please see the first page of
holdings for this fund.
112 See the Financial Notes, which
are integral to this information.
<PAGE> 117
Statement of
ASSETS AND LIABILITIES
As of October 31, 2000. All numbers x 1,000 except NAV.
<TABLE>
<CAPTION>
ASSETS
--------------------------------------------------------------------------------
<S> <C>
Investments, at market value $480,773 a
Collateral held for securities on loan 95,765 b
Receivables:
Fund shares sold 991
Interest 25
Dividends 296
Investments sold 453
Income from lending securities 16
Most recent daily change in value of futures 71
Prepaid expenses + 23
------------
TOTAL ASSETS 578,413
LIABILITIES
--------------------------------------------------------------------------------
Collateral held for securities on loan 95,765 b
Payables:
Fund shares redeemed 104
Investments bought 2,370
Investment adviser and administrator fees 7
Transfer agent and shareholder service fees 10
Accrued expenses + 205
------------
TOTAL LIABILITIES 98,461
NET ASSETS
--------------------------------------------------------------------------------
TOTAL ASSETS 578,413
TOTAL LIABILITIES - 98,461
------------
NET ASSETS $479,952
NET ASSETS BY SOURCE
Capital received from investors 450,165
Net investment income not yet distributed 2,863
Net realized capital losses (3,419)
Net unrealized capital gains 30,343 c
</TABLE>
NET ASSET VALUE (NAV)
<TABLE>
<CAPTION>
SHARES
SHARE CLASS NET ASSETS / OUTSTANDING = NAV
<S> <C> <C> <C>
Investor Shares $217,580 9,676 $22.49
Select Shares(R) $262,372 11,650 $22.52
</TABLE>
a The fund paid $450,223 for these securities. Not counting short-term
obligations and government securities, the fund paid $184,047 for securities
during the report period and received $9,394 from securities it sold or that
matured. This includes $361 in transactions with other SchwabFunds(R).
b Market value of securities loaned: $95,324.
c These derive from investments and futures. As of the report date, the fund had
seven open S&P 500 futures contracts due to expire on December 15, 2000, with
a contract value of $2,520 and unrealized losses of $144 and three open
Russell 2000 futures contracts due to expire on December 15, 2000, with a
contract value of $751 and unrealized losses of $63.
<TABLE>
<CAPTION>
FEDERAL TAX DATA
--------------------------------------------------------------------------------
<S> <C>
COST BASIS OF PORTFOLIO $450,418
NET UNREALIZED GAINS AND LOSSES:
Gains $96,021
Losses + (65,873)
-----------
$30,148
UNUSED CAPITAL LOSSES:
Expires 10/31 of: Loss amount
2007 $ 18
2008 3,413
</TABLE>
See the Financial Notes, which
are integral to this information. 113
<PAGE> 118
SCHWAB TOTAL STOCK MARKET INDEX FUND(TM) -- FINANCIALS
Statement of
OPERATIONS
For November 1, 1999 through October 31, 2000. All numbers x 1,000.
<TABLE>
<CAPTION>
<S> <C>
INVESTMENT INCOME
--------------------------------------------------------------------------------
Dividends $4,322 a
Interest 292
Lending of securities + 178
------------
TOTAL INVESTMENT INCOME 4,792
NET REALIZED GAINS AND LOSSES
--------------------------------------------------------------------------------
Net realized losses on investments sold (3,264)
Net realized losses on futures contracts + (26)
------------
NET REALIZED LOSSES (3,290)
NET UNREALIZED GAINS AND LOSSES
--------------------------------------------------------------------------------
Net unrealized gains on investments 22,064
Net unrealized losses on futures contracts + (305)
------------
NET UNREALIZED GAINS 21,759
EXPENSES
--------------------------------------------------------------------------------
Investment adviser and administrator fees 1,233 b
Transfer agent and shareholder service fees:
Investor Shares 473 c
Select Shares(R) 222 c
Trustees' fees 10 d
Custodian fees 170
Portfolio accounting fees 70
Professional fees 11
Registration fees 87
Shareholder reports 67
Proxy fees 33
Offering costs 23
Other expenses + 32
------------
Total expenses 2,431
Expense reduction - 1,042 e
------------
NET EXPENSES 1,389
INCREASE IN NET ASSETS FROM OPERATIONS
--------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 4,792
NET EXPENSES - 1,389
------------
NET INVESTMENT INCOME 3,403
NET REALIZED LOSSES (3,290) f
NET UNREALIZED GAINS + 21,759 f
------------
INCREASE IN NET ASSETS FROM OPERATIONS $21,872
</TABLE>
a An additional $1 was withheld for foreign taxes.
b Calculated as a percentage of average daily net assets: 0.30% of the first
$500 million and 0.22% of assets beyond that.
c Calculated as a percentage of average daily net assets: for transfer agent
services, 0.05% of the fund's assets; for shareholder services, 0.20%, and
0.05% of the assets of each respective share class.
d For the fund's independent trustees only.
e Includes $940 from the investment adviser (CSIM) and $102 from the transfer
agent and shareholder service agent (Schwab). These reductions reflect a
guarantee by CSIM and Schwab to limit the operating expenses of this fund
through at least February 28, 2001, as follows:
<TABLE>
<CAPTION>
% OF AVERAGE
SHARE CLASS DAILY NET ASSETS
--------------------------------------------------------------------------------
<S> <C>
Investor Shares 0.40
Select Shares 0.27
</TABLE>
This limit does not include interest, taxes and certain non-routine expenses.
f These add up to a net gain on investments of $18,469.
114 See the Financial Notes, which
are integral to this information.
<PAGE> 119
Statements of
CHANGES IN NET ASSETS
For the current and prior report periods. The fund commenced operations on June
1, 1999. All numbers x 1,000.
<TABLE>
<CAPTION>
OPERATIONS
--------------------------------------------------------------------------------
11/1/99-10/31/00 6/1/99-10/31/99
<S> <C> <C>
Net investment income $3,403 $940
Net realized losses (3,290) (129)
Net unrealized gains + 21,759 8,584
---------------------------------
INCREASE IN NET ASSETS FROM OPERATIONS 21,872 9,395
DISTRIBUTIONS PAID
--------------------------------------------------------------------------------
DIVIDENDS FROM NET INVESTMENT INCOME
Investor Shares 667 --
Select Shares(R) + 813 --
---------------------------------
TOTAL DIVIDENDS FROM NET INVESTMENT INCOME $1,480 $ -- a
</TABLE>
<TABLE>
<CAPTION>
TRANSACTIONS IN FUND SHARES
--------------------------------------------------------------------------------
11/1/99-10/31/00 6/1/99-10/31/99
QUANTITY VALUE QUANTITY VALUE
<S> <C> <C> <C> <C>
Shares sold:
Investor Shares 5,815 $131,597 7,071 $142,518
Select Shares + 7,421 168,810 7,558 152,779
---------------------------------------------
TOTAL SHARES SOLD 13,236 $300,407 14,629 $295,297
Shares reinvested:
Investor Shares 28 $634 -- $ --
Select Shares + 33 735 -- --
---------------------------------------------
TOTAL SHARES REINVESTED 61 $1,369 -- $ --
Shares redeemed:
Investor Shares 2,669 $60,481 569 $11,468
Select Shares + 2,944 66,585 418 8,374
---------------------------------------------
TOTAL SHARES REDEEMED 5,613 $127,066 987 $19,842 b
NET INCREASE 7,684 $174,710 13,642 $275,455 c
</TABLE>
<TABLE>
<CAPTION>
SHARES OUTSTANDING AND NET ASSETS
--------------------------------------------------------------------------------
11/1/99-10/31/00 6/1/99-10/31/99
SHARES NET ASSETS SHARES NET ASSETS
<S> <C> <C> <C> <C>
Beginning of period 13,642 $284,850 -- $ --
Total increase + 7,684 195,102 13,642 284,850 d
---------------------------------------------
END OF PERIOD 21,326 $479,952 13,642 $284,850 e
</TABLE>
UNAUDITED
a For corporations, 100% of the fund's dividends for the report period qualify
for the dividends-received deduction.
b Dollar amounts are net of proceeds received from early withdrawal fees that
the fund charges on shares sold 180 days or less after buying them:
<TABLE>
<CAPTION>
<S> <C>
CURRENT PERIOD
Investor Shares $90
Select Shares + 108
-----------
Total $198
PRIOR PERIOD
Investor Shares $39
Select Shares + 40
-----------
Total $79
</TABLE>
c Represents shares sold plus shares reinvested, minus shares redeemed.
d Figures for shares represent the net changes in shares from the transactions
described above. Figures for net assets represent the changes in net assets
from operations plus the value of transactions in fund shares, minus
distributions paid.
Includes net investment income not yet distributed in the amount of $2,863 for
the current period and $940 for the prior period.
See the Financial Notes, which 115
are integral to this information.
<PAGE> 120
SCHWAB
INTERNATIONAL INDEX
FUND(R)
[PHOTO OF GERI HOM]
" The fund's exposure to the stock markets of Japan and the United Kingdom--
both of which have been struggling--contributed to the fund's lackluster
performance during the report period."
Portfolio Manager
Geri Hom
GERI HOM, a vice president of the investment adviser, has overall responsibility
for the management of the fund. Prior to joining the firm in 1995, she worked
for nearly 15 years in equity index management.
TICKER SYMBOLS
INVESTOR SHARES SWINX
SELECT SHARES(R) SWISX
--------------------------------------------------------------------------------
[INVESTMENT STYLE 1 AND MARKET CAP 1 GRAPHIC]
<TABLE>
<S> <C> <C>
VALUE BLEND GROWTH
X LARGE
MEDIUM
SMALL
</TABLE>
For long-term investors who are interested in the potential rewards of
international investing and who are prepared for the additional risks, this fund
could be worth considering.
--------------------------------------------------------------------------------
THE FUND'S GOAL IS TO TRACK THE TOTAL RETURN OF THE SCHWAB INTERNATIONAL
INDEX.(R)
MANAGER'S PERSPECTIVE
LIKE THE U.S. STOCK MARKET, INTERNATIONAL STOCK MARKETS EXPERIENCED NOTABLE
VOLATILITY DURING THE REPORT PERIOD. Developed and emerging markets alike posted
generally lackluster results, with emerging markets suffering the most
volatility along the way. Much of this weakness can be traced to concerns abroad
that an economic slowdown in the United States could reduce demand in that
country for imported goods.
IN EUROPE, INVESTOR ANXIETY OVER HIGH PRICES INCREASED as the U.S. dollar
strengthened against local currencies. Although a strong dollar helps foreign
companies who sell to U.S. customers, it can put inflationary pressure on
foreign economies by increasing the cost of goods they import. Soaring oil
prices only added to that pressure.
JAPAN'S ECONOMY SHOWED SIGNS OF RENEWED VITALITY, with reduced unemployment and
slight increases in real GDP and consumption. Concerns persist, however, as
these increases largely reflect spending by the government and not the private
sector, and corporate debt continues to rise.
FOR THE REPORT PERIOD, BOTH SHARE CLASSES TRACKED THE FUND'S UNMANAGED BENCHMARK
INDEX, THE SCHWAB INTERNATIONAL INDEX. However, both the fund and its benchmark
slightly trailed the MSCI-EAFE(R) Index, which had less exposure to
underperformers Japan and the UK.
1 Source: Morningstar, Inc. This style assessment is the result of comparing
the fund with the S&P 500(R) Index, based on P/E, P/B and median market cap.
The assessment reflects the fund's portfolio as of 10/31/00, which may have
changed since then, and is not a precise indication of risk or performance--
past, present or future.
116
<PAGE> 121
PERFORMANCE: INVESTOR SHARES
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Investor Shares with the Schwab
International Index(R) and the Morningstar Foreign Stock Fund category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR 5 YEARS SINCE INCEPTION: 9/9/93
-------------------------- ---------------------- ------------------------
(0.45%) (0.56%) (0.58%)
------------------ -------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Total Return 2 (3.69%) (3.24%) 4.20% 1 10.17% 10.73% 10.30% 8.88% 9.46% n/a
% of Return Lost to Taxes 8.40% -- 41.43% 1 4.52% -- 15.44% n/a -- n/a
AFTER-TAX RETURN 2 (4.00%) -- 2.46% 1 9.71% -- 8.71% n/a -- n/a
</TABLE>
PERFORMANCE OF A $10,000 INVESTMENT
Shows performance since inception of a hypothetical $10,000 investment in the
fund's Investor Shares, compared to a similar investment in two indices: the
Schwab International Index and the MSCI-EAFE(R) Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
INVESTOR
SHARES SCHWAB INTERNATIONAL INDEX MSCI EAFE ND INDEX
<S> <C> <C> <C>
9/9/93 10000 10000 10000
9/30/93 9770 9786 9749
10/31/93 10150 10167 10049
11/30/93 9420 9454 9171
12/31/93 10096 10137 9833
1/31/94 10769 10823 10664
2/28/94 10558 10623 10634
3/31/94 10156 10172 10176
4/30/94 10458 10544 10607
5/31/94 10407 10448 10547
6/30/94 10488 10508 10696
7/31/94 10649 10692 10798
8/31/94 10941 10999 11054
9/30/94 10559 10621 10706
10/31/94 10950 11026 11062
11/30/94 10428 10478 10530
12/31/94 10484 10564 10597
1/31/95 10108 10254 10190
2/28/95 10189 10282 10160
3/31/95 10759 10964 10794
4/30/95 11145 11346 11200
5/31/95 11176 11303 11067
6/30/95 11064 11168 10873
7/31/95 11623 11826 11550
8/31/95 11237 11384 11110
9/30/95 11470 11661 11327
10/31/95 11318 11461 11022
11/30/95 11562 11782 11329
12/31/95 11975 12238 11785
1/31/96 12006 12277 11834
2/29/96 12026 12300 11874
3/31/96 12232 12529 12126
4/30/96 12530 12826 12478
5/31/96 12396 12674 12249
6/30/96 12489 12761 12317
7/31/96 12139 12430 11958
8/31/96 12253 12538 11984
9/30/96 12592 12907 12303
10/31/96 12571 12863 12177
11/30/96 13136 13460 12662
12/31/96 13067 13341 12499
1/31/97 12640 12898 12061
2/28/97 12827 13114 12259
3/31/97 12932 13202 12303
4/30/97 13025 13344 12368
5/31/97 13984 14324 13174
6/30/97 14766 15160 13899
7/31/97 15214 15570 14125
8/31/97 14109 14447 13070
9/30/97 15078 15354 13801
10/31/97 13869 14110 12740
11/30/97 13859 14055 12610
12/31/97 14022 14254 12720
1/31/98 14538 14830 13301
2/28/98 15382 15727 14155
3/31/98 15782 16139 14591
4/30/98 15888 16248 14706
5/31/98 15888 16209 14634
6/30/98 16025 16315 14745
7/31/98 16067 16419 14894
8/31/98 14085 14350 13049
9/30/98 13632 13880 12648
10/31/98 14981 15335 13966
11/30/98 15751 16198 14681
12/31/98 16244 16729 15261
1/31/99 16190 16640 15216
2/28/99 15829 16311 14853
3/31/99 16541 17060 15473
4/30/99 17212 17794 16099
5/31/99 16371 16897 15270
6/30/99 16999 17586 15866
7/31/99 17616 18240 16337
8/31/99 17775 18410 16398
9/30/99 18105 18724 16563
10/31/99 19073 19722 17184
11/30/99 19945 20579 17781
12/31/99 21704 22386 19377
1/31/00 19999 20761 18147
2/29/00 20278 21097 18635
3/31/00 21457 22294 19358
4/30/00 20299 21089 18340
5/31/00 19720 20470 17892
6/30/00 20460 21234 18592
7/31/00 19667 20411 17813
8/31/00 20021 20770 17967
9/30/00 18980 19696 17092
10/31/00 18369 19083 16689
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 732 funds in the Foreign
Stock Fund category that had track records of at least one year and 305 funds
with track records of at least five years. These funds may or may not use
tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
117
<PAGE> 122
Schwab International Index Fund(R)
PERFORMANCE: SELECT SHARES(R)
AVERAGE ANNUAL TOTAL RETURNS as of 10/31/00
This chart compares performance of the fund's Select Shares with the Schwab
International Index(R) and the Morningstar Foreign Stock Fund
category.
[BAR CHART]
<TABLE>
<CAPTION>
1 YEAR SINCE INCEPTION: 5/19/97
------------------------- ------------------------
(0.41%) (0.80%)
----------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Total Return 2 (3.65%) (3.24%) 4.20% 7.95% 8.75% n/a
% of Return Lost to Taxes 9.86% -- 41.43% n/a -- n/a
AFTER-TAX RETURN 2 (4.01%) -- 2.46% n/a -- n/a
</TABLE>
PERFORMANCE OF A $50,000 INVESTMENT
Shows performance since inception of a hypothetical $50,000 investment in the
fund's Select Shares, compared to a similar investment in two indices: the
Schwab International Index and the MSCI-EAFE(R) Index.
[LINE GRAPH]
<TABLE>
<CAPTION>
SELECT
SHARES SCHWAB INTERNATIONAL INDEX MSCI EAFE ND INDEX
<S> <C> <C> <C>
5/19/97 50000 50000 50000
5/31/97 49375 49283 49248
6/30/97 52170 52161 51961
7/31/97 53755 53571 52803
8/31/97 49815 49706 48859
9/30/97 53240 52827 51595
10/31/97 49005 48550 47627
11/30/97 48970 48360 47141
12/31/97 49580 49042 47551
1/31/98 51405 51027 49725
2/28/98 54385 54111 52917
3/31/98 55800 55529 54547
4/30/98 56175 55905 54978
5/31/98 56175 55770 54708
6/30/98 56655 56133 55124
7/31/98 56845 56493 55681
8/31/98 49840 49376 48782
9/30/98 48240 47757 47284
10/31/98 53005 52763 52211
11/30/98 55725 55732 54885
12/31/98 57490 57561 57053
1/31/99 57305 57252 56881
2/28/99 56025 56122 55528
3/31/99 58585 58699 57843
4/30/99 60955 61225 60186
5/31/99 57980 58137 57086
6/30/99 60200 60507 59313
7/31/99 62385 62757 61074
8/31/99 62950 63342 61300
9/30/99 64115 64425 61919
10/31/99 67575 67857 64241
11/30/99 70660 70806 66470
12/31/99 76920 77025 72439
1/31/00 70880 71433 67839
2/29/00 71870 72588 69664
3/31/00 76050 76708 72367
4/30/00 71905 72561 68561
5/31/00 69895 70431 66888
6/30/00 72515 73058 69503
7/31/00 69740 70228 66591
8/31/00 70995 71462 67169
9/30/00 67310 67769 63898
10/31/00 65110 65658 62390
</TABLE>
All figures on this page assume dividends and distributions were reinvested.
Index figures do not include trading and management costs, which would lower
performance. The indices are unmanaged, and you cannot invest in them directly.
When you sell your shares, they may be worth more or less than what you paid for
them. Past performance doesn't indicate future results.
The after-tax returns reflect several assumptions:
- federal income tax was deducted from distributions before reinvestment
- the tax rates used were the highest in effect at the time the distribution
was made--currently 39.6% on dividends and short-term capital gains and
20.0% on long-term capital gains
- no allowance was made for the effects of any state or local taxes, or of any
shareholder activities (such as selling fund shares)
Your own tax rates may be different. Keep in mind that after-tax returns aren't
a factor for shares held in tax-deferred accounts such as an IRA or 401(k).
1 Source: Morningstar, Inc. As of 10/31/00, there were 732 funds in the Foreign
Stock Fund category that had track records of at least one year and 305 funds
with track records of at least five years. These funds may or may not use
tax-efficient strategies.
2 Fund returns reflect expense reductions by the fund's investment adviser
(CSIM) and Schwab. Without these reductions, the fund's returns would have
been lower. After-tax return data is provided by Morningstar, Inc.
118
<PAGE> 123
FUND FACTS
<TABLE>
<CAPTION>
TOP TEN HOLDINGS 1 as of 10/31/00
<S> <C>
1 VODAFONE GROUP PLC 3.0%
2 NTT DOCOMO, INC. 2.8%
3 BP AMOCO PLC 2.3%
4 TOYOTA MOTOR CORP. 1.8%
5 NORTEL NETWORKS CORP. 1.6%
6 ROYAL DUTCH PETROLEUM CO. 1.5%
7 HSBC HOLDINGS PLC 1.4%
8 NIPPON TELEGRAPH & TELEPHONE CORP. 1.4%
9 DEUTSCHE TELEKOM AG 1.3%
10 NOVARTIS AG, REGISTERED 1.3%
----
TOTAL PERCENTAGE OF INVESTMENTS 18.4%
</TABLE>
STATISTICS as of 10/31/00
<TABLE>
<CAPTION>
PEER GROUP
FUND AVERAGE 2
<S> <C> <C>
Number of Holdings 357 166
-------------------------------------------------
Median Market Cap ($ Mil) $41,530 $22,343
-------------------------------------------------
Price/Earnings (P/E) Ratio 33.5 34.1
-------------------------------------------------
Price/Book (P/B) Ratio 5.9 6.4
-------------------------------------------------
12-Month Yield Investor Shares 0.90% 0.77%
-------------------------------------------------
Portfolio Turnover Rate 16% 92%
-------------------------------------------------
Three-Year Beta 0.75 0.72
-------------------------------------------------
</TABLE>
EXPENSE RATIO as of 10/31/00
[BAR CHART]
<TABLE>
<S> <C>
INVESTOR SHARES 0.58% 3
SELECT SHARES(R) 0.47% 3
PEER GROUP AVERAGE 1.69% 2
</TABLE>
1 This list is not a recommendation of any security by the investment
adviser. Portfolio holdings may have changed since the report date.
2 Source: Morningstar, Inc. As of 10/31/00, there were 732 funds in the
Foreign Stock Fund category.
3 Guaranteed by Schwab and the investment adviser through 2/28/01. The actual
expense ratio during the report period was 0.01% higher due to certain
non-routine expenses.
4 Source: Charles Schwab & Co., Inc.
PERFORMANCE AND WEIGHTINGS OF INDEX COUNTRIES 4
The bar chart shows how the countries in the Schwab International Index(R)
performed during the report period. The pie chart shows the size (by stock
market capitalization) of each of the countries in the index. The index counts
each country's performance in proportion to its size.
[BAR CHART]
<TABLE>
<CAPTION>
INDEX PERFORMANCE 11/1/99 - 10/31/00
<S> <C>
Canada 37.9
Italy 15.6
Sweden 10.8
Australia 7.9
France 5.5
Denmark 3.4
Hong Kong 2.6
Netherlands 1.1
Germany 0.8
Spain -0.3
Schwab International Index -3.2
United Kingdom -6.1
Switzerland -6.5
Japan -13.8
Belgium -17.4
</TABLE>
INDEX COMPOSITION AS OF 10/31/00
[PIE CHART]
<TABLE>
<S> <C> <C>
1 31.9% Japan
2 22.5% United Kingdom
3 8.6% France
4 8.1% Germany
5 6.2% Switzerland
6 6.0% Netherlands
7 3.6% Canada
8 3.5% Italy
9 2.6% Spain
10 2.3% Sweden
11 1.8% Hong Kong
12 1.6% Australia
13 0.9% Belgium
14 0.6% Denmark
</TABLE>
119
<PAGE> 124
SCHWAB INTERNATIONAL INDEX FUND(R) -- FINANCIALS
FINANCIAL TABLES
These pages provide additional data on the fund's performance, portfolio
holdings, expenses and business operations. These figures have been audited by
PricewaterhouseCoopers LLP.
Two other sections of this report provide context for the data in these
financials. THE FINANCIAL NOTES section contains information about the fund's
business structure, accounting practices and other matters, completing the data
given in these tables. The final section, HOW TO READ THIS REPORT, includes
guides designed to make the financials easy to read and understand.
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
11/1/99 - 11/1/98 - 11/1/97 - 11/1/96 - 11/1/95 -
INVESTOR SHARES 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
-------------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period 17.93 14.21 13.31 12.23 11.13
----- ----- ----- ----- -----
Income from investment operations:
Net investment income 0.20 0.19 0.17 0.17 0.16
Net realized and unrealized gains or losses (0.85) 3.66 0.88 1.08 1.07
----- ----- ----- ----- -----
Total income or loss from investment
operations (0.65) 3.85 1.05 1.25 1.23
Less distributions:
Dividends from net investment income (0.15) (0.13) (0.15) (0.17) (0.13)
----- ----- ----- ----- -----
Net asset value at end of period 17.13 17.93 14.21 13.31 12.23
===== ===== ===== ===== =====
Total return (%) (3.69) 27.31 8.02 10.33 11.07
RATIOS/SUPPLEMENTAL DATA (%)
-------------------------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses to
average net assets 0.58 1 0.58 0.58 0.61 0.69
Expense reductions reflected in above ratio 0.23 0.41 0.46 0.52 0.48
Ratio of net investment income to
average net assets 1.60 1.24 1.35 1.36 1.50
Portfolio turnover rate 16 5 6 13 6
Net assets, end of period ($ x 1,000,000) 637 447 428 318 247
</TABLE>
1 Would have been 0.59% if certain non-routine expenses (proxy fees) had been
included.
120 See the Financial Notes, which
are integral to this information.
<PAGE> 125
<TABLE>
<CAPTION>
11/1/99 - 11/1/98 - 11/1/97 - 5/19/97 1 -
SELECT SHARES(R) 10/31/00 10/31/99 10/31/98 10/31/97
<S> <C> <C> <C> <C>
PER-SHARE DATA ($)
------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period 17.96 14.23 13.32 13.59
----- ----- ----- -----
Income from investment operations:
Net investment income 0.27 0.18 0.22 0.04
Net realized and unrealized gains or losses (0.91) 3.70 0.85 (0.31)
----- ----- ----- -----
Total income or loss from investment
operations (0.64) 3.88 1.07 (0.27)
Less distributions:
Dividends from net investment income (0.18) (0.15) (0.16) --
----- ----- ----- -----
Net asset value at end of period 17.14 17.96 14.23 13.32
===== ===== ===== =====
Total return (%) (3.65) 27.49 8.16 (1.99) 2
RATIOS/SUPPLEMENTAL DATA (%)
------------------------------------------------------------------------------------------------------------------------
Ratio of net operating expenses
to average net assets 0.47 4 0.47 0.47 0.47 3
Expense reductions reflected in above ratio 0.19 0.39 0.48 0.80 3
Ratio of net investment income to
average net assets 1.71 1.57 1.49 0.17 3
Portfolio turnover rate 16 5 6 13
Net assets, end of period ($ x 1,000,000) 700 449 94 50
</TABLE>
1 Commencement of operations.
2 Not annualized.
3 Annualized.
4 Would have been 0.48% if certain non-routine expenses (proxy fees) had been
included.
See the Financial Notes, which 121
are integral to this information.
<PAGE> 126
SCHWAB INTERNATIONAL INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS
As of October 31, 2000
This section shows all the securities in the fund's portfolio and their market
value, as of the report date.
We use the symbols below to designate certain characteristics. With the top ten
holdings, the number in the circle is the security's rank among the top ten.
(1) Top ten holding
+ New holding (since 10/31/99)
- Non-income producing security
The pie chart below shows the fund's major asset categories and the market value
and cost of the securities in each category.
ALL DOLLAR VALUES ARE IN THOUSANDS.
[PIE CHART]
<TABLE>
<S> <C>
99.6% COMMON STOCK
Market Value: $1,328,889
Cost: $1,166,256
0.4% SHORT TERM INVESTMENTS
Market Value: $5,605
Cost: $5,605
----------------------------------
100.0% TOTAL INVESTMENTS
Market Value: $1,334,494
Cost: $1,171,864
</TABLE>
FOREIGN COMMON STOCK 99.6% of investments
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
AUSTRALIA 1.4%
----------------------------------------------------------------------------------------
AMP Ltd. 179,976 1,622
Australia & New Zealand Banking Group Ltd. 229,702 1,696
Broken Hill Proprietary Co. Ltd. 272,306 2,639
- Cable and Wireless Optus Ltd. 526,166 1,114
Commonwealth Bank of Australia 195,707 2,912
National Australia Bank 236,597 3,286
News Corp. Ltd. 339,732 3,553
- OneSteel Ltd. 68,077 32
Westpac Banking Corp. 306,830 2,095
------
18,949
BELGIUM 0.5%
----------------------------------------------------------------------------------------
Almanij NV 27,381 1,015
Electrabel SA 8,797 1,908
- Fortis (B) 116,150 3,554
------
6,477
CANADA 4.2%
----------------------------------------------------------------------------------------
Alcan Aluminum Ltd. 37,466 1,179
+ Ballard Power Systems, Inc. 12,600 1,353
Bank of Montreal 37,377 1,725
Bank of Nova Scotia 80,094 2,281
Barrick Gold Corp. 86,591 1,148
BCE, Inc. 97,164 2,608
BCT Telus Communications, Inc. 26,400 674
Bombardier, Inc., Class B 226,100 3,546
Canadian Imperial Bank of Commerce 54,445 1,725
Canadian Pacific Ltd. 50,624 1,467
-+ Celestica, Inc. 33,400 2,379
Imperial Oil Ltd. 63,322 1,596
Loblaw Co. Ltd. 38,800 1,326
+(5) Nortel Networks Corp. 468,134 21,180
+ Power Financial Corp. 69,400 1,459
Royal Bank of Canada 87,772 2,776
Seagram Co. Ltd. 67,990 3,891
+ Shell Canada Ltd. 52,100 1,192
Toronto-Dominion Bank 96,856 2,660
-------
56,165
DENMARK 0.5%
----------------------------------------------------------------------------------------
D/S 1912, Series B 172 1,645
Dampskibsselkabet Svendborg, Series B 111 1,466
Novo-Nordisk A/S, Series B 10,672 2,261
Tele Danmark A/S 32,861 1,553
-------
6,925
FRANCE 11.8%
----------------------------------------------------------------------------------------
Accor SA 27,663 1,118
Air Liquide SA 14,016 1,655
Alcatel SA 178,073 10,852
+ Altran Technologies SA 4,850 990
Aventis SA 121,475 8,752
Axa 61,011 8,067
BNP Paribas 72,921 6,280
</TABLE>
122 See the Financial Notes, which
are integral to this information.
<PAGE> 127
<TABLE>
<CAPTION>
Mkt. Value
Security and Number of Shares ($ x 1,000)
<S> <C>
Bouygues 55,335 2,814
Canal Plus 18,684 2,700
Cap Gemini SA 19,279 3,072
Carrefour Supermarche SA 111,232 7,458
Castorama Dubois Investissements SA 5,864 1,191
Compagnie de Saint-Gobain SA 13,719 1,813
Credit Lyonnais SA 47,339 1,617
+ Dassault Systemes SA 17,174 1,308
Establissements Economiques du Casino Guichard Perrachon SA 10,894 950
+ European Aeronautic Defense & Space Co. 117,744 2,395
+ France Telecom SA 161,321 16,846
Groupe Danone 21,924 3,062
L'Oreal 110,659 8,442
Lafarge SA 18,043 1,331
+ Lagardere S.C.A. 23,390 1,326
LVMH Moet-Hennessy Vuitton 76,948 5,609
Pinault-Printemps-Redoute SA 19,854 3,539
PSA Peugeot Citroen 6,683 1,229
+ Renault SA 36,047 1,790
+ Sagem SA 5,698 1,043
Sanofi-Synthelabo SA 121,626 6,392
Schneider Electric SA 25,234 1,642
Societe Generale, Class A 69,238 3,926
Societe Television Francaise 1 30,120 1,642
STMicroelectronics NV 138,356 6,972
Suez Lyonnaise des Eaux SA 31,657 4,824
+ Thomson CSF 26,590 1,192
Total Fina Elf SA 116,263 16,615
Vivendi SA 96,790 6,949
-------
157,403
GERMANY 7.8%
-------------------------------------------------------------------------------------------------
BASF AG 105,779 4,142
Bayer AG 118,963 5,158
Bayerische Hypo-und Vereinsbank AG 65,411 3,590
Bayerische Motoren Werke AG 106,314 3,516
+ Beiersdorf AG 13,000 1,278
Commerzbank AG 75,889 2,139
DaimlerChrysler AG 155,133 7,140
Deutsche Bank AG 94,565 7,733
Deutsche Lufthansa AG 63,568 1,255
+(9) Deutsche Telekom AG 477,600 17,913
Dresdner Bank AG 79,248 3,298
E.ON AG 132,993 6,750
-+ EM.TV & Merchandising AG 37,500 1,128
Ergo Versicherungsgruppe AG 10,500 1,451
+ Fresenius Medical Care AG 14,400 1,145
+ Henkel Kgaa 16,600 865
Metro AG 43,648 1,757
Muenchener Rueckversicher AG 27,256 8,559
RWE AG 74,301 2,976
SAP AG 28,400 4,643
Schering AG 28,146 1,575
Siemens AG 93,195 11,853
ThyssenKrupp AG 78,370 1,116
Volkswagen AG 49,820 2,486
-------
103,466
HONG KONG / CHINA 2.0%
-------------------------------------------------------------------------------------------------
Cheung Kong Holdings 355,000 3,926
CLP Holdings Ltd. 293,900 1,372
Hang Seng Bank Ltd. 301,700 3,549
Henderson Land Development Co. 282,000 1,215
Hong Kong Electric Holdings Ltd. 341,756 1,128
Hutchison Whampoa Ltd. 664,800 8,247
Johnson Electric Holdings 540,000 1,073
-+ Pacific Century CyberWorks Ltd. 2,710,978 2,086
Sun Hung Kai Properties Ltd. 337,694 2,793
Swire Pacific Ltd., Class A 246,500 1,520
-------
26,909
ITALY 4.8%
-------------------------------------------------------------------------------------------------
-+ AEM SPA 297,187 982
+ Alleanza Assicurazioni SPA 112,662 1,493
+ Alleanza Assicurazioni SPA -- RNC 76,755 590
Assicurazioni Generali 192,362 6,318
Autostrade Concessioni e Costruzioni Autostrade SPA 160,539 932
Banca Commerciale Italiana SPA 213,676 1,255
+ Banca Fideuram SPA 133,688 2,053
</TABLE>
See the Financial Notes, which 123
are integral to this information.
<PAGE> 128
SCHWAB INTERNATIONAL INDEX FUND(R) -- FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
Mkt. Value
Security and Number of Shares ($ x 1,000)
<S> <C>
Banca Intesa SPA 686,260 2,844
Banca Intesa SPA -- RNC 307,838 744
+ Banca Monte dei Paschi di Siena SPA 328,813 1,364
+ Banca Nazionale Del Lavoro SPA 332,898 1,078
-+ Bipop-Carire SPA 259,134 2,047
Ente Nazionale Idrocarburi SPA 1,220,290 6,599
Fiat SPA 58,110 1,350
Fiat SPA -- RNC 40,452 529
+ Finmeccanica SPA 1,111,161 1,272
Mediaset SPA 177,519 2,565
Olivetti SPA 708,459 2,144
+ Riunione Adriatica di Sicurta SPA 133,886 1,756
+ Rolo Banca 1473 SPa 65,393 1,214
+ Seat-Pagine Gialle SPa 701,558 1,909
Telecom Italia SPa 568,694 6,580
Telecom Italia SPA -- RNc 265,037 1,440
TIM SPa 1,042,021 8,850
TIM SPA -- RNc 223,802 1,186
+ Tiscali SPa 36,045 1,137
Unicredito Italiano SPa 742,035 3,774
-------
64,005
JAPAN 26.9%
-------------------------------------------------------------------------------------------------
Advantest Corp. 15,700 2,046
Ajinomoto Co., Inc. 137,000 1,531
The Asahi Bank Ltd. 408,000 1,607
Asahi Chemical Industry Co. Ltd. 206,000 1,275
Asahi Glass Co. Ltd. 191,000 1,959
The Bank of Tokyo-Mitsubishi Ltd. 723,500 8,674
+ Benesse Corp. 17,000 934
Bridgestone Corp. 124,000 1,229
Canon, Inc. 134,000 5,314
Central Japan Railway Co. 362 2,205
Chubu Electric Power Co., Inc. 107,100 1,766
DAI Nippon Printing Co. Ltd. 125,000 1,958
Daiwa Securities Group, Inc. 213,000 2,358
DDI Corp. 464 2,177
Denso Corp. 144,000 3,284
East Japan Railway Co. 375 2,153
+ Eisai Co. Ltd. 48,000 1,477
Fanuc 37,100 3,330
Fuji Photo Film Co. Ltd. 87,000 3,227
+ Fuji Television Network, Inc. 100 1,099
+ Fujisawa Pharmaceutical Co. Ltd. 50,000 1,571
Fujitsu Ltd. 305,000 5,430
+ Furukawa Electric Co. Ltd. 101,000 2,655
Hitachi Ltd. 520,000 5,572
Honda Motor Co. Ltd. 152,000 5,248
Hoya Corp. 16,000 1,322
Ito-Yokado Co. Ltd. 68,000 3,070
Japan Telecom Co. Ltd. 100 2,015
Japan Tobacco, Inc. 301 2,068
Kansai Electric Power Co. 144,300 2,362
KAO Corp. 108,000 3,234
Keyence Corp. 6,300 1,956
Kinki Nippon Railway Co. Ltd. 360,830 1,563
Kirin Brewery Co. Ltd. 168,000 1,751
Kyocera Corp. 29,000 3,771
+ Marui Co. Ltd. 66,000 973
Matsushita Communications Industrial Co. Ltd. 29,000 3,798
Matsushita Electric Industrial Co. Ltd. 330,000 9,581
Matsushita Electric Works 139,000 1,636
Mitsubishi Chemical Corp. 434,000 1,371
Mitsubishi Corp. 286,000 2,357
Mitsubishi Electric Corp. 372,000 2,671
Mitsubishi Estate Co. Ltd. 189,000 2,008
Mitsubishi Heavy Industries Ltd. 510,000 1,980
Mitsubishi Trust & Banking Corp. 190,000 1,540
Mitsui & Co. Ltd. 246,000 1,633
+ Mitsui Fudosan Co. Ltd. 115,000 1,392
-+ Mizuho Holdings, Inc. 1,457 11,195
Murata Manufacturing Co. Ltd. 37,000 4,426
NEC Corp. 251,000 4,781
The Nikko Securities Co. Ltd. 288,000 2,485
+ Nikon Corp. 50,000 726
Nintendo Co. Ltd. 22,600 3,736
Nippon Steel Corp. 995,000 1,613
(8) Nippon Telegraph & Telephone Corp. 1,992 18,116
+ Nippon Television Network 4,000 2,253
</TABLE>
124 See the Financial Notes, which
are integral to this information.
<PAGE> 129
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
- Nissan Motor Co. Ltd. 643,000 4,411
+ Nitto Denko Corp. 34,000 1,149
Nomura Securities Co. Ltd. 306,000 6,488
+ NTT Data Corp. 432 3,363
(2) NTT DoCoMo, Inc. 1,517 37,373
+ OJI Paper Co. Ltd. 165,000 960
+ Omron Corp. 53,000 1,306
+ Oriental Land Co. Ltd. 17,000 1,028
Osaka Gas Co. Ltd. 392,000 966
Ricoh Co. Ltd. 97,000 1,492
Rohm Co. Ltd. 18,000 4,535
Sakura Bank Ltd. 638,000 4,645
Sankyo Co. Ltd. 62,000 1,366
The Sanwa Bank Ltd. 463,000 4,113
Sanyo Electric Co. Ltd. 281,000 2,136
Secom Co. Ltd. 34,000 2,423
Sekisui House Ltd. 120,000 1,268
Seven-Eleven Japan Co. 131,000 8,518
Sharp Corp. 165,000 2,100
Shin-Etsu Chemical Co. 65,700 2,696
The Shizuoka Bank Ltd. 176,000 1,597
SMC Corp. 10,000 1,414
Softbank Corp. 54,000 3,239
Sony Corp. 138,400 11,053
The Sumitomo Bank Ltd. 522,000 6,334
Sumitomo Chemical Co. Ltd. 302,000 1,488
Sumitomo Corp. 174,000 1,530
Sumitomo Electric Industries Ltd. 131,000 2,417
Sumitomo Trust & Banking Co. Ltd. 220,000 1,692
Taisho Pharmaceutical Co. Ltd. 51,000 1,467
Taiyo Yuden Co. Ltd. 25,000 955
Takeda Chemical Industries Ltd. 145,000 9,548
TDK Corp. 22,000 2,216
Terumo Corp. 44,000 1,245
The Tokai Bank Ltd. 385,000 2,063
Tokio Marine & Fire Insurance Co. 229,000 2,529
Tokyo Broadcasting System 26,000 1,017
Tokyo Electric Power Co., Inc. 206,700 5,017
Tokyo Electronics Ltd. 28,000 2,190
Tokyo Gas Co. Ltd. 471,000 1,229
Toppan Printing Co. Ltd. 152,000 1,342
Toshiba Corp. 482,000 3,443
(4) Toyota Motor Corp. 588,000 23,479
West Japan Railway Co. 273 1,120
Yamanouchi Pharmaceutical Co. Ltd. 52,000 2,353
Yamato Transport Co. Ltd. 78,000 1,575
-------
359,350
NETHERLANDS 5.9%
-----------------
ABN-AMRO Holdings NV 239,217 5,535
Aegon NV 209,586 8,314
Akzo Nobel NV 43,972 2,000
- ASM Lithography Holding NV 63,272 1,727
-+ Equant NV 35,326 1,181
- Fortis (NL) NV 77,095 2,352
+ Heineken NV 50,834 2,758
ING Groep NV 149,477 10,252
Koninklijke Ahold NV 110,848 3,216
Koninklijke Philips Electronics NV 202,862 7,963
(6) Royal Dutch Petroleum Co. 343,316 20,338
Royal KPN NV 141,497 2,863
TNT Post Group NV 74,422 1,574
Unilever NV-CVA 90,046 4,511
-+ United Pan-Europe Communications NV Class A 64,336 1,126
VNU NV 35,955 1,691
Wolters Kluwer NV-CVA 65,554 1,474
-------
78,875
SPAIN 2.7%
-----------
Banco Bilbao Vizcaya Argentaria SA 506,368 6,738
Banco Popular Espanol 34,068 1,018
Banco Santander Central Hispano SA 654,981 6,340
Endesa SA 155,665 2,533
Gas Natural SDG SA 78,688 1,347
- Iberdrola SA 137,409 1,678
Repsol YPF SA 195,798 3,107
- Telefonica SA 655,930 12,493
-------
35,254
</TABLE>
See the Financial Notes, which 125
are integral to this information.
<PAGE> 130
SCHWAB INTERNATIONAL INDEX FUND(R) - FINANCIALS
PORTFOLIO HOLDINGS Continued
As of October 31, 2000
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ x 1,000)
<S> <C>
SWEDEN 2.5%
------------
+ Europolitan Holdings AB 92,307 829
Foreningssparbaken AB 80,166 1,148
Hennes & Mauritz AB, Series B 127,045 2,371
-+ NetCom AB, Class B 16,371 766
Nordic Baltic Holding AB 430,385 3,221
+ Securitas AB, Class B 55,925 1,189
Skandia Forsakrings AB 161,720 2,736
Skandinaviska Enskilda Banken, Series A 107,724 1,269
Svenska Handelsbanken AB, Series A 86,306 1,352
Svenska Handelsbanken AB, Series B 49,697 769
Telefonaktiebolaget LM Ericsson, Class B 1,225,073 16,261
Volvo AB, Series A 42,580 637
Volvo AB, Series B 45,050 692
-------
33,240
SWITZERLAND 6.1%
-----------------
ABB Ltd. 49,072 4,360
Adecco SA 2,605 1,801
Cie Financiere Richemont, Series A 764 2,124
Credit Suisse Group, Registered 42,392 7,945
Holderbank Financiere Glarus AG, Bearer 1,302 1,368
Holderbank Financiere Glarus AG, Registered 3,740 1,100
Nestle SA, Registered 6,097 12,631
(10) Novartis AG, Registered 11,267 17,088
Roche Holding AG, Bearer 257 2,776
Roche Holding AG, Genus 1,107 10,109
Schweizerische Lebensversicherungs-und Rentenanstalt 1,600 1,244
+ Swisscom AG, Registered 11,396 2,893
UBS AG, Registered 67,962 9,411
+ Zurich Financial Services AG 13,472 6,518
-------
81,368
UNITED KINGDOM 22.5%
---------------------
Abbey National PLC 206,737 2,855
Amvescap PLC 109,531 2,449
-+ ARM Holdings PLC 146,005 1,442
AstraZeneca PLC 276,556 12,963
BAA PLC 143,314 1,192
BAE Systems PLC 420,330 2,390
Bank of Scotland PLC 167,830 1,567
Barclays PLC 257,565 7,376
BASS PLC 114,181 1,118
BG Group PLC 555,316 2,226
BOC Group PLC 69,920 975
Boots Co. PLC 113,489 906
(3) BP Amoco PLC 3,590,077 30,471
British American Tobacco PLC 330,995 2,321
- British Sky Broadcasting PLC 293,831 4,245
British Telecommunications PLC 1,046,268 12,276
Cable & Wireless PLC 442,218 6,261
Cadbury Schweppes PLC 288,970 1,788
+ Carlton Communications PLC 119,714 965
Centrica PLC 596,018 2,051
CGNU PLC 340,029 4,552
+ CMG PLC 89,440 1,478
-+ Colt Telecom Group PLC 110,422 3,528
Diageo PLC 515,475 4,869
Dixons Group PLC 380,071 1,131
+ Emi Group PLC 151,595 1,136
GKN PLC 123,926 1,422
GKN PLC, Class B 112,926 16
Glaxo Wellcome PLC 563,770 16,242
- Granada Compass PLC 284,501 2,454
Halifax Group PLC 367,749 2,894
Hays PLC 273,040 1,492
(7) HSBC Holdings PLC 1,340,668 19,117
Invensys PLC 536,368 1,281
J Sainsbury PLC 256,515 1,442
Kingfisher PLC 224,137 1,341
+ Land Securities PLC 111,739 1,152
- Lattice Group PLC 555,316 1,185
Legal & General Group PLC 786,557 1,959
Lloyds TSB Group PLC 839,425 8,557
+ Logica PLC 75,618 2,239
+ Marconi PLC 422,564 5,338
Marks & Spencer PLC 430,439 1,200
National Grid Group PLC 221,283 1,920
- P & O Princess Cruises PLC 158,799 624
</TABLE>
126 See the Financial Notes, which
are integral to this information.
<PAGE> 131
<TABLE>
<CAPTION>
MKT. VALUE
SECURITY AND NUMBER OF SHARES ($ X 1,000)
<S> <C>
Pearson, Inc. PLC 116,225 3,121
Peninsular & Oriental Steam Navigation 158,799 655
Prudential Corp. PLC 302,788 4,076
Railtrack Group PLC 67,870 1,051
+ Reckitt Benckiser PLC 121,651 1,600
Reed International PLC 202,964 1,877
Rentokil Initial PLC 632,994 1,461
Reuters Group PLC 221,741 4,321
Rio Tinto PLC 158,600 2,568
Rolls-Royce PLC 4,904 13
Royal & Sun Alliance Insurance Group PLC 255,512 1,820
Royal Bank of Scotland Group PLC 401,462 9,018
-+ Sage Group PLC 211,963 1,548
Scottish & Southern Energy PLC 115,521 961
Scottish Power PLC 255,801 1,922
+ Sema Group PLC 91,564 1,157
Shell Transport & Trading Co. PLC 1,562,409 12,580
SmithKline Beecham PLC 877,418 11,340
Standard Chartered PLC 168,487 2,432
- Telewest Communications PLC 743,967 1,232
Tesco PLC 1,095,810 4,181
Unilever PLC 463,912 3,141
(1) Vodafone Group PLC 9,703,324 40,404
WPP Group PLC 102,317 1,374
-------
300,259
UNITED STATES 0.0%
-------------------------------------------------------------------------------------------------
- NTL, Inc. 5,553 244
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM INVESTMENTS
0.4% of investments
SECURITY FACE VALUE MKT. VALUE
RATE, MATURITY DATE ($ X 1,000) ($ X 1,000)
<S> <C> <C>
Wachovia Bank Time Deposit
6.030%, 11/01/00 5,605 5,605
</TABLE>
--------------------------------------------------------------------------------
END OF PORTFOLIO HOLDINGS. For totals, please see the first page of holdings for
this fund.
See the Financial Notes, which 127
are integral to this information.
<PAGE> 132
SCHWAB INTERNATIONAL INDEX FUND(R) -- FINANCIALS
Statement of
ASSETS AND LIABILITIES
As of October 31, 2000. All numbers x 1,000 except NAV.
<TABLE>
<S> <C> <C>
ASSETS
--------------------------------------------------------------------------------
Investments, at market value $1,334,494 a
Collateral held for securities on loan 108,298
Foreign currency (Cost $30) 30
Receivables:
Fund shares sold 2,172
Interest 1
Dividends 1,269
Investments sold 673
Income from lending securities 39 b
Dividend tax reclaim 820
Prepaid expenses + 44
--------------------
TOTAL ASSETS 1,447,840
LIABILITIES
--------------------------------------------------------------------------------
Collateral held for securities on loan 108,298
Payables:
Fund shares redeemed 1,893
Withholding taxes 37
Investment adviser and administrator fees 24
Transfer agent and shareholder service fees 27
Accrued expenses + 282
--------------------
TOTAL LIABILITIES 110,561
NET ASSETS
--------------------------------------------------------------------------------
TOTAL ASSETS 1,447,840
TOTAL LIABILITIES - 110,561
--------------------
NET ASSETS $1,337,279
NET ASSETS BY SOURCE
Capital received from investors 1,185,477
Net investment income not yet distributed 19,116
Net realized capital losses (29,825)
Net unrealized capital gains on investments
and translating assets and liabilities into
reporting currency 162,511
</TABLE>
NET ASSET VALUE (NAV)
<TABLE>
<CAPTION>
SHARES
SHARE CLASS NET ASSETS / OUTSTANDING = NAV
<S> <C> <C> <C> <C> <C>
Investor Shares $637,218 37,206 $17.13
Select Shares(R) $700,061 40,837 $17.14
</TABLE>
a The fund paid $1,171,864 for these securities. Not counting short-term
obligations and government securities, the fund paid $743,323 for securities
during the report period and received $195,251 from securities it sold or that
matured. This includes $3,515 in transactions with other SchwabFunds(R).
b Market value of securities loaned: $102,281.
<TABLE>
<CAPTION>
FEDERAL TAX DATA
--------------------------------------------------------------------------------
<S> <C> <C>
COST BASIS OF PORTFOLIO $1,182,392
NET UNREALIZED GAINS AND LOSSES:
Gains $244,650
Losses + (92,548)
-----------------
$152,102
RECLASSIFICATIONS:
Net realized capital losses $813
Reclassified as:
Net investment income
not yet distributed ($813)
UNUSED CAPITAL LOSSES:
Expires 10/31 of: Loss amount
<S> <C>
2002 $ 140
2004 1,743
2005 1,837
2006 11,905
2007 7
2008 3,669
</TABLE>
128 See the Financial Notes, which
are integral to this information.
<PAGE> 133
Statement of
OPERATIONS
For November 1, 1999 through October 31, 2000. All numbers x 1,000.
<TABLE>
<S> <C>
INVESTMENT INCOME
--------------------------------------------------------------------------------
Dividends $24,893 a
Interest 1,095
Lending of securities + 384
--------------
TOTAL INVESTMENT INCOME 26,372
NET REALIZED GAINS AND LOSSES
--------------------------------------------------------------------------------
Net realized losses on investments sold (13,715)
Net realized losses on foreign currency transactions + (370)
--------------
NET REALIZED LOSSES (14,085)
NET UNREALIZED GAINS AND LOSSES
--------------------------------------------------------------------------------
Net unrealized losses on investments (85,560)
Net unrealized losses on foreign currency transactions + (119)
--------------
NET UNREALIZED LOSSES (85,679)
EXPENSES
--------------------------------------------------------------------------------
Investment adviser and administrator fees 5,596 b
Transfer agent and shareholder service fees:
Investor Shares 1,461 c
Select Shares(R) 621 c
Trustees' fees 11 d
Custodian fees 510
Portfolio accounting fees 187
Professional fees 68
Registration fees 231
Shareholder reports 154
Proxy fees 95
Other expenses + 27
--------------
Total expenses 8,961
Expense reduction - 2,561 e
--------------
NET EXPENSES 6,400
DECREASE IN NET ASSETS FROM OPERATIONS
--------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 26,372
NET EXPENSES - 6,400
---------------
NET INVESTMENT INCOME 19,972
NET REALIZED LOSSES (14,085) f
NET UNREALIZED LOSSES + (85,679) f
---------------
DECREASE IN NET ASSETS FROM OPERATIONS ($79,792)
</TABLE>
a An additional $1,870 was withheld for foreign taxes.
b Calculated as a percentage of average daily net assets: 0.43% of the first
$500 million and 0.38% of assets beyond that. Prior to February 29, 2000, the
percentages were 0.70% of the first $300 million and 0.60% of assets beyond
that.
c Calculated as a percentage of average daily net assets: for transfer agent
services, 0.05% of the fund's assets; for shareholder services, 0.20%, and
0.05% of the assets of each respective share class.
d For the fund's independent trustees only.
e Includes $2,327 from the investment adviser (CSIM) and $234 from the transfer
agent and shareholder service agent (Schwab). These reductions reflect a
guarantee by CSIM and Schwab to limit the operating expenses of this fund
through at least February 28, 2001, as follows:
<TABLE>
% OF AVERAGE
SHARE CLASS DAILY NET ASSETS
--------------------------------------------------------------------------------
<S> <C>
Investor Shares 0.58
Select Shares 0.47
</TABLE>
This limit does not include interest, taxes and certain non-routine expenses.
f These add up to a net loss on investments of $99,764.
See the Financial Notes, which 129
are integral to this information.
<PAGE> 134
SCHWAB INTERNATIONAL INDEX FUND(R) -- FINANCIALS
Statements of
CHANGES IN NET ASSETS
For the current and prior report periods. All numbers x 1,000.
OPERATIONS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
11/1/99 - 10/31/00 11/1/98 - 10/31/99
<S> <C> <C> <C>
Net investment income $19,972 $9,282
Net realized losses (14,085) (436)
Net unrealized gains or losses + (85,679) 159,588
----------------------------------------------------------
INCREASE OR DECREASE IN NET ASSETS FROM OPERATIONS (79,792) 168,434
</TABLE>
DISTRIBUTIONS PAID
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Dividends from net investment income
Investor Shares 4,063 4,066
Select Shares(R) + 4,878 1,055
----------------------------------------------------------
TOTAL DIVIDENDS FROM NET INVESTMENT INCOME $8,941 $5,121
</TABLE>
TRANSACTIONS IN FUND SHARES
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
11/1/99 - 10/31/00 11/1/98 - 10/31/99
QUANTITY VALUE QUANTITY VALUE
<S> <C> <C> <C> <C> <C>
Shares sold:
Investor Shares 19,884 $374,024 11,715 $186,131
Select Shares + 20,555 387,062 20,684 334,045
---------------------------------------------------------------------
TOTAL SHARES SOLD 40,439 $761,086 32,399 $520,176
Shares reinvested:
Investor Shares 193 $3,704 255 $3,798
Select Shares + 233 4,478 61 904
---------------------------------------------------------------------
TOTAL SHARES REINVESTED 426 $8,182 316 $4,702
Shares redeemed:
Investor Shares 7,778 $145,804 17,223 $277,601
Select Shares + 4,945 92,957 2,328 37,107
---------------------------------------------------------------------
TOTAL SHARES REDEEMED 12,723 $238,761 19,551 $314,708 a
NET INCREASE 28,142 $530,507 13,164 $210,170 b
</TABLE>
SHARES OUTSTANDING AND NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
11/1/99 - 10/31/00 11/1/98 - 10/31/99
SHARES NET ASSETS SHARES NET ASSETS
<S> <C> <C> <C> <C> <C>
Beginning of period 49,901 $895,505 36,737 $522,022
Total increase + 28,142 441,774 13,164 373,483 c
---------------------------------------------------------------------
END OF PERIOD 78,043 $1,337,279 49,901 $895,505 d
</TABLE>
a Dollar amounts are net of proceeds received from early withdrawal fees that
the fund charges on shares sold 180 days or less after buying them:
<TABLE>
<S> <C>
CURRENT PERIOD
Investor Shares $336
Select Shares + 200
-----------
Total $536
PRIOR PERIOD
Investor Shares $65
Select Shares + 50
-----------
Total $115
</TABLE>
b Represents shares sold plus shares reinvested, minus shares redeemed.
c Figures for shares represent the net changes in shares from the transactions
described above. Figures for net assets represent the changes in net assets
from operations plus the changes in value of transactions in fund shares,
minus distributions paid.
d Includes net investment income not yet distributed in the amount of $19,116
for the current period and $8,898 for the prior period.
Percent of fund shares owned by other SchwabFunds(R) as of the end of the
current period:
<TABLE>
<S> <C>
SCHWAB MARKETTRACK PORTFOLIOS(R)
All Equity Portfolio 9.8%
Growth Portfolio 8.3%
Balanced Portfolio 5.6%
Conservative Portfolio 1.4%
SCHWAB ANNUITY PORTFOLIOS
Growth Portfolio II 0.3%
</TABLE>
130 See the Financial Notes, which
are integral to this information.
<PAGE> 135
FINANCIAL NOTES
FINANCIAL NOTES
BUSINESS STRUCTURE OF THE FUNDS
EACH OF THE FUNDS DISCUSSED IN THIS REPORT IS A SERIES OF A NO-LOAD, OPEN-END
MANAGEMENT INVESTMENT COMPANY. Each of these companies is organized as a
Massachusetts business trust and is registered under the Investment Company Act
of 1940, as amended. The sidebar shows the funds in this report by trust.
THE FUNDS OFFER MULTIPLE SHARE CLASSES. For any given fund, shares of each class
represent interests in the same portfolio, but each class has its own costs and
investment minimums. In addition, one share class, e.Shares(R), is available
only to clients of Schwab Institutional, Charles Schwab Trust Company and
certain tax-advantaged retirement plans, and can only be traded electronically.
<TABLE>
<CAPTION>
INVESTOR SELECT
FUND SHARES SHARES(R) e.SHARES
--------------------------------------------------------------------------------
<S> <C> <C> <C>
S&P 500 - - -
Schwab 1000 - -
Small-Cap Index - -
Total Stock Market Index - -
International Index - -
</TABLE>
For these funds, shares are bought and sold at net asset value, or NAV, which is
the price for all outstanding shares. Each share has a par value of 1/1,000 of a
cent, and the trustees may issue as many shares as necessary.
THE TRUSTS AND THEIR FUNDS
--------------------------------------------------------------------------------
This list shows the trust containing each fund in this report, along with all
other funds included in these trusts. The funds discussed in this report are
highlighted.
SCHWAB INVESTMENTS
Organized October 26, 1990
Schwab 1000 Fund(R)
Schwab Short-Term Bond Market Index Fund
Schwab Total Bond Market Index Fund
Schwab YieldPlus Fund(TM)
Schwab Short/Intermediate Tax-Free Bond Fund
Schwab Long-Term Tax-Free Bond Fund
Schwab California Short/Intermediate Tax-Free
Bond Fund
Schwab California Long-Term Tax-Free Bond Fund
SCHWAB CAPITAL TRUST
Organized May 7, 1993
Schwab S&P 500 Fund
Schwab Small-Cap Index Fund(R)
Schwab Total Stock Market Index Fund(TM)
Schwab International Index Fund(R)
Schwab Analytics Fund(R)
Schwab MarketTrack All Equity Portfolio
Schwab MarketTrack Growth Portfolio
Schwab MarketTrack Balanced Portfolio
Schwab MarketTrack Conservative Portfolio
Schwab MarketManager Growth Portfolio
Schwab MarketManager Balanced Portfolio
Schwab MarketManager Small Cap Portfolio
Schwab MarketManager International Portfolio
Communications Focus Fund
Financial Services Focus Fund
Health Care Focus Fund
Technology Focus Fund
Institutional Select(TM)S&P 500 Fund
Institutional Select(TM)Large-Cap Value Index Fund
Institutional Select(TM)Small-Cap Value Index Fund
131
<PAGE> 136
FINANCIAL NOTES
FUND OPERATIONS
Most of the funds' investments are described in the fund-by-fund sections
earlier in this report. However, there are certain other investments and
policies that may affect a fund's financials. The most significant of these are
described below. Other policies concerning the funds' business operations also
are described here.
THE FUNDS PAY DIVIDENDS from net investment income and make distributions from
net capital gains once a year.
THE FUNDS MAY INVEST IN FUTURES CONTRACTS TO PARTICIPATE IN THE RETURN OF AN
INDEX. Futures contracts involve certain risks, because they can be very
sensitive to market movements.
One risk is that the price of a futures contract may not move in perfect
correlation with the price of the underlying securities. Another risk is that,
at certain times, it may be impossible for the fund to close out a position in a
futures contract due to a difference in trading hours or to market conditions
that may reduce the liquidity for a futures contract or its underlying
securities.
Because futures carry inherent risks, a fund must give the broker a deposit of
cash and/or securities (the "initial margin") whenever it enters into a futures
contract. The amount of the deposit may vary from one contract to another, but
it is generally a percentage of the contract amount.
Futures are traded publicly on exchanges, and their market value changes daily.
The fund records the change in market value of futures, and also the change in
the amount of margin deposit required ("variation margin").
THE SCHWAB INTERNATIONAL INDEX FUND(R) MAY INVEST IN FORWARD CURRENCY CONTRACTS
IN CONNECTION WITH THE PURCHASE AND SALE OF PORTFOLIO SECURITIES TO MINIMIZE THE
UNCERTAINTY OF CHANGES IN FUTURE EXCHANGE RATES. "Forwards," as they are known,
are contracts to buy and sell a currency at a set price on a future date.
Forwards are similar to futures except that they are not publicly traded, but
are agreements directly between two parties. As of the report date, the fund had
no forwards in its portfolio.
As with futures, forwards involve certain risks that are not fully reflected in
the fund's financials. If counterparties to the contracts are unable to meet the
terms of the contracts or if the value of the foreign currency changes
unfavorably, the fund could sustain a loss.
THE FUNDS MAY ENTER INTO REPURCHASE AGREEMENTS. In a repurchase agreement, a
fund buys a security from another party (usually a financial institution) with
the agreement that it be sold back in the future. The date, price and other
conditions are all specified when the agreement is created.
Among the terms of the funds' repurchase agreements is that they be fully
collateralized by U.S. Treasury or government agency securities. All collateral
is held by the funds' custodian and is monitored daily to ensure that its market
value at least equals the repurchase price under the agreement.
132
<PAGE> 137
THE FUNDS MAY LOAN SECURITIES TO CERTAIN BROKERS, DEALERS AND OTHER FINANCIAL
INSTITUTIONS WHO PAY THE FUNDS NEGOTIATED FEES. The funds receive cash, letters
of credit or U.S. government securities as collateral on these loans, and the
value of the collateral must be at least 102% of the market value of the loaned
securities as of the first day of the loan, and at least 100% each day
thereafter.
THE FUNDS MAY BORROW MONEY FROM BANKS. The funds may obtain temporary bank loans
through the trusts to which they belong, to use for meeting shareholder
redemptions or for extraordinary or emergency purposes. The trusts have line of
credit arrangements with PNC Bank, N.A., Bank of America, N.A. and The Bank of
New York. The funds pay interest on the amounts they borrow at rates that are
negotiated periodically. As of the end of the report period there were no
borrowings outstanding.
THE FUNDS PAY FEES FOR VARIOUS SERVICES. Through their trusts, the funds have
agreements with Charles Schwab Investment Management, Inc. (CSIM) to provide
investment advisory and administrative services and with Charles Schwab & Co.,
Inc. (Schwab) to provide transfer agent and shareholder services. Although these
agreements specify certain fees for these services, CSIM and Schwab have made
additional agreements with the funds limiting certain expenses. The rates and
limitations for these fees vary from fund to fund, and are described in each
fund's Statement of Operations.
TRUSTEES MAY INCLUDE PEOPLE WHO ARE OFFICERS AND/OR DIRECTORS OF THE INVESTMENT
ADVISER AND/OR SCHWAB. Federal securities law limits the percentage of such
"interested persons" who may serve on a trust's board, and the trusts were in
compliance with these limitations throughout the report period. The trusts did
not pay any of these persons for their service as trustees, but they did pay the
independent trustees, as noted in each fund's Statement of Operations.
THE FUNDS MAY ENGAGE IN CERTAIN TRANSACTIONS INVOLVING AFFILIATES. For instance,
a fund may own shares of The Charles Schwab Corp. if that company is included in
its index. The funds also may let other SchwabFunds(R) buy and sell fund shares,
particularly Schwab MarketTrack Portfolios,(TM) which seek to provide investors
with allocated portfolios of Schwab index funds.
The funds may make direct transactions with certain other SchwabFunds when
practical. When one fund is seeking to sell a security that another is seeking
to buy, an interfund transaction can allow both funds to benefit by reducing
transaction costs. This practice is limited to funds that share the same
investment adviser, trustees and officers.
THE FUNDS INTEND TO MEET FEDERAL INCOME AND EXCISE TAX REQUIREMENTS FOR
REGULATED INVESTMENT COMPANIES. Accordingly, the funds distribute substantially
all of their net investment income and realized net capital gains (if any) to
their respective shareholders each year. As long as a fund meets the tax
requirements, it is not required to pay federal income tax.
133
<PAGE> 138
FINANCIAL NOTES
ACCOUNTING POLICIES
The following are the main policies the funds use in preparing their financial
statements.
THE FUNDS VALUE THE SECURITIES IN THEIR PORTFOLIOS EVERY BUSINESS DAY. The funds
use the following policies to value various types of securities:
EXCHANGE-TRADED SECURITIES: valued at the last-quoted sale price for
the day, or, on days when no sale has been reported, halfway between
the most recent bid and asked quotes.
SECURITIES TRADED OVER-THE-COUNTER: same as exchange-traded securities.
SECURITIES FOR WHICH NO QUOTED VALUE IS AVAILABLE, INCLUDING RESTRICTED
SECURITIES: valued at fair value, as determined in good faith by the
fund's investment adviser using guidelines adopted by the fund's Board
of Trustees.
FUTURES AND FORWARDS: open contracts are valued at their settlement
prices as of the close of their exchanges (for futures) or at a market
value based on that day's exchange rates (for forwards). When a fund
closes out a futures or forwards position, it calculates the difference
between the value of the position at the beginning and at the end, and
records a realized gain or loss accordingly.
SHORT-TERM SECURITIES (60 DAYS OR LESS TO MATURITY): valued at
amortized cost.
SECURITY TRANSACTIONS are recorded as of the date the order to buy or sell the
security is executed.
DIVIDENDS AND DISTRIBUTIONS FROM PORTFOLIO SECURITIES are recorded on the date
they are effective (the ex-dividend date), although the funds record certain
foreign security dividends on the day they learn of the ex-dividend date.
INCOME FROM INTEREST AND THE ACCRETION OF DISCOUNTS is recorded as it accrues.
REALIZED GAINS AND LOSSES from security transactions are based on the identified
costs of the securities involved.
ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES are reported in U.S.
dollars. For assets and liabilities held on a given date, the dollar value is
based on market exchange rates in effect on that date. Transactions involving
foreign currencies, including purchases, sales, income receipts and expense
payments, are figured using exchange rates in effect on the transaction date.
The funds separate within their statement of operations the portion of realized
and unrealized gains and losses resulting from changes in foreign currency
exchange rates from fluctuations in market prices of investments held.
EXPENSES that are specific to a fund are charged directly to that fund. Expenses
that are common to all funds within a trust generally are allocated among the
funds in proportion to their net assets.
EACH FUND MAINTAINS ITS OWN ACCOUNT FOR PURPOSES OF HOLDING ASSETS AND
ACCOUNTING, and is considered a separate entity for tax purposes. Within its
account, each fund also keeps certain assets in segregated accounts, as may be
required by securities law.
THE ACCOUNTING POLICIES DESCRIBED ABOVE CONFORM WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES. Notwithstanding this, shareholders should understand that
in order to follow these principles, fund management has to make estimates and
assumptions that affect the information reported in the financial statements.
It's possible that once the results are known, they may turn out to be different
from these estimates.
134
<PAGE> 139
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF:
Schwab S&P 500 Fund
Schwab 1000 Fund(R)
Schwab Total Stock Market Index Fund(TM)
Schwab Small-Cap Index Fund(R)
Schwab International Index Fund(R)
In our opinion, the accompanying statements of assets and liabilities, including
the portfolio holdings, and the related statements of operations and of changes
in net assets and the financial highlights present fairly, in all material
respects, the financial position of Schwab S&P 500 Fund, Schwab 1000 Fund(R)
(one of the portfolios constituting Schwab Investments), Schwab Total Stock
Market Index Fund(TM), Schwab Small-Cap Index Fund(R), and Schwab International
Index Fund(R) (hereafter collectively referred to as the "funds") at October 31,
2000, and the results of each of their operations for the year then ended, the
changes in each of their net assets and the financial highlights for the periods
presented, in conformity with accounting principles generally accepted in the
United States of America. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
funds' management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with auditing standards generally accepted in
the United States of America, which require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at October 31, 2000 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion.
PRICEWATERHOUSECOOPERS LLP
San Francisco, CA
December 12, 2000
135
<PAGE> 140
PROXY VOTING RESULTS (UNAUDITED)
SHAREHOLDERS OF THE FUNDS COVERED IN THIS REPORT APPROVED ALL PROPOSALS
DESCRIBED IN THE MOST RECENT SCHWABFUNDS(R) PROXY SOLICITATION. A special
meeting of the shareholders of Schwab Capital Trust and Schwab Investments was
held on June 1, 2000. The number of votes necessary to conduct the meeting and
approve each proposal was obtained. The results of the votes of shareholders are
listed below by proposal.
<TABLE>
FOR WITHHELD
--------------------------------------------------------------------------------
<S> <C> <C>
Proposal 1
ELECTION OF TRUSTEES (SCHWAB CAPITAL TRUST)
Charles R. Schwab 289,830,691 68,146,593
Mariann Byerwalter 289,803,100 68,174,184
Jeremiah H. Chafkin 290,116,655 67,860,629
Donald F. Dorward 289,894,704 68,082,580
William A. Hasler 289,963,656 68,013,628
Robert G. Holmes 290,075,539 67,901,745
Steven L. Scheid 290,226,860 67,750,424
Gerald B. Smith 290,102,267 67,875,017
Donald R. Stephens 290,162,159 67,815,125
Michael W. Wilsey 290,227,986 67,749,298
ELECTION OF TRUSTEES (SCHWAB INVESTMENTS)
Charles R. Schwab 164,731,678 19,977,396
Mariann Byerwalter 164,731,678 19,977,396
Jeremiah H. Chafkin 164,731,678 19,977,396
Donald F. Dorward 164,731,678 19,977,396
William A. Hasler 164,731,678 19,977,396
Robert G. Holmes 164,731,678 19,977,396
Steven L. Scheid 164,731,678 19,977,396
Gerald B. Smith 164,731,678 19,977,396
Donald R. Stephens 164,731,678 19,977,396
Michael W. Wilsey 164,731,678 19,977,396
</TABLE>
136
<PAGE> 141
<TABLE>
<CAPTION>
FOR AGAINST ABSTAINED 1
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
PROPOSAL 2c1
TO APPROVE CHANGES TO RESTRICTIONS REGARDING BORROWING.
Schwab S&P 500 Fund 143,724,607 3,999,214 35,801,921
Schwab 1000(R) 75,333,834 2,664,432 18,546,852
Schwab Small-Cap Index Fund(R) 28,545,531 591,356 813,594
Schwab International Index Fund(R) 29,554,482 519,028 1,060,508
PROPOSAL 2c2
TO APPROVE CHANGES TO RESTRICTIONS REGARDING LENDING.
Schwab S&P 500 Fund 143,619,954 4,023,269 35,882,519
Schwab 1000 75,282,017 2,696,603 18,566,498
Schwab Small-Cap Index Fund 28,538,352 600,356 811,773
Schwab International Index Fund 29,559,344 517,860 1,056,814
PROPOSAL 2c3
TO APPROVE CHANGES TO RESTRICTIONS REGARDING SENIOR SECURITIES.
Schwab S&P 500 Fund 143,776,649 3,835,530 35,913,563
Schwab 1000 75,474,928 2,441,866 18,628,324
Schwab Small-Cap Index Fund 28,547,289 587,637 815,555
Schwab International Index Fund 29,445,882 626,254 1,061,882
PROPOSAL 2d
TO APPROVE CHANGES TO RESTRICTIONS REGARDING DIVERSIFICATION.
Schwab S&P 500 Fund 144,262,800 3,452,434 35,810,508
Schwab 1000 75,736,838 2,278,087 18,530,193
Schwab Small-Cap Index Fund 28,587,955 548,307 814,219
Schwab International Index Fund 29,610,805 467,708 1,055,505
PROPOSAL 2f
TO APPROVE CHANGES TO RESTRICTIONS REGARDING RESTRICTED OR ILLIQUID SECURITIES.
Schwab S&P 500 Fund 143,500,531 4,141,136 35,884,075
Schwab 1000 75,115,192 2,852,761 18,577,165
Schwab Small-Cap Index Fund 28,476,187 664,012 810,282
Schwab International Index Fund 29,430,041 651,558 1,052,419
PROPOSAL 2h
TO APPROVE CHANGES TO RESTRICTIONS REGARDING OWNERSHIP OF SECURITIES.
Schwab S&P 500 Fund 143,776,649 3,835,530 35,913,563
Schwab 1000 75,474,928 2,441,866 18,628,324
Schwab Small-Cap Index Fund 28,547,289 587,637 815,555
Schwab International Index Fund 29,445,882 626,254 1,061,882
</TABLE>
1 Includes broker non-votes.
137
<PAGE> 142
<TABLE>
<CAPTION>
FOR AGAINST ABSTAINED 1
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
PROPOSAL 2i
TO APPROVE CHANGES TO RESTRICTIONS REGARDING INDUSTRY CONCENTRATION.
Schwab S&P 500 Fund 144,000,435 3,605,355 35,919,952
Schwab 1000(R) 75,484,898 2,491,463 18,568,757
Schwab Small-Cap Index Fund(R) 28,571,274 568,552 810,654
Schwab International Index Fund(R) 29,581,436 495,337 1,057,245
PROPOSAL 2j
TO APPROVE CHANGES TO RESTRICTIONS REGARDING COMMODITIES, FUTURES, AND REAL
ESTATE.
Schwab S&P 500 Fund 143,626,528 4,011,490 35,887,724
Schwab 1000 75,105,085 2,888,198 18,551,835
Schwab Small-Cap Index Fund 28,495,105 642,479 812,896
Schwab International Index Fund 29,525,824 546,464 1,061,730
PROPOSAL 2k
TO APPROVE CHANGES TO RESTRICTIONS REGARDING UNDERWRITING OF SECURITIES.
Schwab S&P 500 Fund 143,826,747 3,818,261 35,880,734
Schwab 1000 75,343,762 2,603,781 18,597,575
Schwab Small-Cap Index Fund 28,559,582 582,543 808,356
Schwab International Index Fund 29,580,737 496,340 1,056,941
PROPOSAL 2l
TO APPROVE CHANGES TO RESTRICTIONS REGARDING CONTROL OF AN ISSUER.
Schwab S&P 500 Fund 144,449,548 3,480,991 35,595,203
Schwab 1000 75,550,728 2,476,012 18,518,378
Schwab Small-Cap Index Fund 28,618,383 584,453 747,645
Schwab International Index Fund 30,175,116 501,706 457,196
PROPOSAL 3a
TO APPROVE CHANGES TO RESTRICTIONS REGARDING THE SCHWAB SMALL-CAP INDEX FUND
INVESTMENT OBJECTIVE AND TO ELIMINATE THE FUND'S INVESTMENT POLICY REGARDING
PORTFOLIO COMPOSITION.
Schwab Small-Cap Index Fund 29,000,928 410,034 539,519
PROPOSAL 3b
TO APPROVE CHANGES TO RESTRICTIONS REGARDING THE SCHWAB INTERNATIONAL INDEX FUND
INVESTMENT OBJECTIVE AND TO ELIMINATE THE FUND'S INVESTMENT POLICY REGARDING
PORTFOLIO COMPOSITION.
Schwab International Index Fund 30,502,318 388,639 243,061
</TABLE>
1 Includes broker non-votes.
138
<PAGE> 143
HOW TO READ THIS REPORT
This report, including the financial tables, has been designed to be EASY TO
READ. The next few pages provide additional information that can help you more
fully understand the financial tables and why they are important to ALL FUND
INVESTORS.
In this section, we take a closer look at the types of information presented in
the financial tables.
Brief CALLOUTS add context to some of the most important elements in the tables,
and help explain certain fund operations and accounting principles.
At the end, a GLOSSARY defines many of the technical financial terms that are
used in this report.
139
<PAGE> 144
HOW TO READ THIS REPORT Continued
[GRAPHIC OF FINANCIAL HIGHLIGHTS SAMPLE TABLE]
FINANCIAL HIGHLIGHTS I
PER-SHARE DATA ($) 2
Income from investment operations: 3
Net investment income
Net realized and unrealized gains
Total income from investment operations
Total return (%) 4
1 The financial highlights summarize the fund's activities over the past five
years (or since inception, if the fund doesn't yet have five years of
operating history).
2 The figures in the first part of the table are for a single share of the fund
that was "outstanding," or in existence, during the periods indicated.
3 These lines show how much the fund earned per share, and where these earnings
came from: how much was from interest and dividends, and how much from
capital appreciation (that is, price increases of investments the fund
owned). A fund may show losses in this section if its expenses exceeded its
income or its capital losses exceeded its capital gains.
4 Some funds, such as money funds, typically receive all their earnings as
interest, while some equity funds may have only appreciation, or may receive
interest and dividends only occasionally.
5 Total return shows what an investor in the fund would have earned or lost
during each period indicated, assuming that all dividends and distributions
were reinvested. Because the numbers in the financial highlights are for a
fund's fiscal year, they will be different from calendar year numbers, except
for funds whose fiscal year is the same as the calendar year.
140
<PAGE> 145
[GRAPHIC OF FINANCIAL HIGHLIGHTS SAMPLE TABLE]
* 1/1/97-10/31/97
** (0.19)
(-) 0.49
(-) 0.40
(+) 1.89
(++) 1
Table is for illustration only.
* In some cases, such as with funds that started partway through their
planned fiscal year or have changed their fiscal year, the financial
highlights may contain a "stub period" that is less than 12 months.
** In financial tables, parentheses around numbers are used to indicate a
negative number, such as a loss, or a number that is being subtracted,
such as a distribution paid by a fund to its shareholders.
(-) The figures in this part of the table disclose a fund's annual operating
expenses. The expenses are shown as a percentage of a fund's average net
assets, because they are paid from these assets.
(-) For some funds, the annual expenses are capped at a certain level. With
these funds, there are two sets of expense figures: net expenses and the
amounts of any expense reductions. The net figures reflect what the
expenses actually were, after the reductions.
(+) This shows you how much a fund netted in dividend and interest income
(i.e., total dividends and interest minus expenses), expressed as a
percentage of the fund's average net assets.
(++) The turnover rate tells you how actively a fund has traded securities. A
rate of 100% would be the equivalent of replacing every security in the
portfolio over the period of a year.
(++) Consistently high turnover can result in taxable distributions, which can
lower after-tax performance -- although this is not a concern if your
investment is held in an IRA, 401(k) or other tax-deferred account.
141
<PAGE> 146
HOW TO READ THIS REPORT Continued
The Portfolio Holdings (sometimes also called the Schedule of Investments) is a
snapshot of all securities a fund held on the last day of the report
period.
Symbols that may appear in the Portfolio Holdings:
(1) Top ten holding--shows a fund's ten largest positions, as measured by
market value.
+ New holding--a security the fund added during the report period.
[BULLET] Non-income producing security--this includes several categories of
securities: those that never pay dividends (such as many growth stocks);
those that sometimes pay dividends, but have not done so in the past 12
months; and those that typically do pay dividends, but have missed a recent
dividend payment.
[GREATER THAN ARROW] Global Depositary Receipt (GDR)--a security issued in one
country that represents a stock issued in another country.
[DIAMOND] American Depositary Receipt (ADR)--a type of GDR that is traded in the
United States and priced in U.S. dollars.
[TRIANGLE] Collateral for open futures contracts--indicates a security the fund
has set aside in a separate account to cover possible losses that may
result from a futures contract. The fund is not permitted to sell a
security while it is pledged as collateral.
[RECTANGLE] Issuer is affiliated with the fund's adviser--indicates a security
issued by the company that manages the fund, or an affiliate of that
company. Substantial ownership of such securities could represent conflict
of interest, which is why this disclosure is required.
This shows a breakdown of holdings by asset type. To the right of the pie chart
are figures showing the total market value of securities of each asset type, and
also what a fund paid for those securities.
PORTFOLIO HOLDINGS
(1) Top ten holding
+ New holding
[BULLET] Non-income producing security
[GREATER THAN ARROW] Global Depositary Receipt
[DIAMOND] American Depositary Receipt
[TRIANGLE] Collateral for open futures contracts
[RECTANGLE] Issuer is affiliated with the fund's adviser
[GRAPHIC OF PORTFOLIO HOLDINGS SAMPLE TABLE]
<TABLE>
<CAPTION>
MARKET VALUE COST
------------ ----
<S> <C> <C> <C>
COMMON STOCK 99.9% $7,368,959 $5,767,040
U.S. TREASURY OBLIGATIONS 0.1% 3,778 3,778
SHORT-TERM INVESTMENTS 1,864 1,864
----- ---------- ----------
TOTAL INVESTMENTS 100.0% 7,374,601 5,772,682
</TABLE>
Table is for illustration only.
142
<PAGE> 147
For all bonds, the report shows the security name, the rate the security
pays and the maturity date. The maturity date is the date when the bond is
retired and the issuer returns the money borrowed ("principal" or "face
value") to the bondholder.
** During its lifetime, a bond may trade at a premium or a discount to its par
value, depending on interest rate trends and other factors. When a bond
begins to approach maturity, its market value typically moves closer to its
face value.
In this example, the investment shown is one that seeks to maintain a stable
$1.00 share price, so the number of shares is typically the same as the
market value (allowing for rounding in the value column).
* In some cases, securities are organized into sub-groups (in this example,
stock holdings are organized by industry). For each sub-group, there are
figures showing the percentage of investments represented and the total
market value of the securities in the subgroup. Note that for all dollar
values, you need to add three zeroes after each number to get the
approximate value.
(+) In this example, the investment shown is one that seeks to maintain a stable
$1.00 share price, so the number of shares is typically the same as the
market value (allowing for rounding in the value column).
[GRAPHIC OF PORTFOLIO HOLDINGS SAMPLE TABLE]
Table is for illustration only.
(-) Most equity funds keep a small percentage of assets in high quality, liquid
investments, in order to manage their cash flow needs.
* UTILITIES: ELECTRIC & GAS 2.6%
** U.S. Treasury Bills
(+) Provident Institutional TempCash
(-) Other Investment Companies
143
<PAGE> 148
HOW TO READ THIS REPORT Continued
* The Statement of Assets and Liabilities is a snapshot of a fund's balance
sheet on the last day of the report period.
(-) At any given time, a fund is likely to be owed money from various sources
that it has not yet received, and to owe money it hasn't yet paid.
(++) This section gathers the totals from the first two sections in order to
compute net assets.
(-x) This section shows where the assets described above came from. "Capital
received from investors" is money a fund received from investors buying its
shares during the report period, and is a net figure (meaning that money
the fund remitted to investors who redeemed their shares has already been
subtracted from it).
[GRAPHIC OF ASSETS AND LIABILITIES SAMPLE TABLE]
Table is for illustration only.
** As with the Portfolio Holdings, the figures in these statements need to be
multiplied by 1,000. This includes the figures in the notes.
(+) The collateral is simultaneously counted as an asset (because the fund held
it as of the report date) and as a liability (because it is owned by the
institutions that provided it as collateral).
(-x) Although a mutual fund doesn't expect to pay federal income tax, it does
have to file a return with the IRS and disclose certain tax information to
shareholders. In some cases, the requirements of tax accounting differ from
the requirements of the accounting practices used in keeping a fund's
books, so the figures in this box may differ from those shown elsewhere in
the financials. These differences may require that some values be
reclassified in the financials, but this does not affect a fund's NAV.
[GRAPHIC OF FEDERAL TAX DATA SAMPLE TABLE]
Table is for illustration only.
* Assets and Liabilities
** As of October 31, 2000
(-) Receivables
(-) Payables
(+) Collateral held for securities on loan
(++) Net Assets
(+X) Federal Tax Data
(-X) Net Assets by Source
144
<PAGE> 149
[GRAPHIC OF STATEMENT OF OPERATIONS SAMPLE TABLE]
* Statement of OPERATIONS
** NET REALIZED GAINS AND LOSSES
*** NET UNREALIZED GAINS AND LOSSES
**** Custodian fees
# Investment adviser and administrator fees
## Transfer agent and shareholder service fees:
Investor Shares
Select Shares(R)
### INCREASE IN NET ASSETS FROM OPERATIONS
Table is for illustration only.
*The Statement of Operations tells you how much money a fund earned and spent
over the course of the report period, and how much it gained and lost on its
investments.
**These are the capital gains or losses resulting from securities a fund sold
during the report period.
***These represent the change in unrealized gains or losses over the report
period.
***To safeguard the interests of shareholders, mutual funds must keep their
portfolio securities in accounts at a financial institution, whose tasks include
maintaining records of a fund's holdings.
*Covers most activities related to managing a fund's portfolio.
##Covers most activities associated with shareholders, including processing
transactions in fund shares and providing services such as account statements
and information. In funds with more than one share class, these figures are
reported by class.
###This section gathers the totals from the first four sections in order to
compute the net earnings or losses that resulted from a fund's operations during
the report period. These figures also appear, in summary form, on the Statements
of Changes in Net Assets.
145
<PAGE> 150
HOW TO READ THIS REPORT Continued
[GRAPHIC OF CHANGES IN NET ASSETS SAMPLE TABLE]
* Statements of CHANGES IN NET ASSETS
** TRANSACTIONS IN FUND SHARES
***
<TABLE>
<CAPTION>
OPERATIONS
--------------------------------------------------------
11/1/99-10/31/00
<S> <C>
Net investment income .................. $65,370
Net realized gains ..................... 22,632
Net unrealized gains ................... +1,063,273
----------
INCREASE IN NET ASSETS FROM OPERATIONS.. 1,151,275
</TABLE>
****
<TABLE>
<CAPTION>
OPERATIONS
--------------------------------------------------------
11/1/98-10/31/99
<S> <C>
Net investment income ..................... $35,310
Net realized gains ........................ (8,303)
Net unrealized gains ...................... 371,823
-------
INCREASE IN NET ASSETS FROM OPERATIONS..... 398,830
</TABLE>
# SHARES OUTSTANDING AND NET ASSETS
Table is for illustration only.
*The Statements of Changes in Net Assets compare a fund's performance during the
current report period with its performance from the previous report period.
Keep in mind that if the current report is a semiannual report, its figures
are only for six months, whereas the figures for the previous period are
generally for a full year.
**From this section, you can see how the size of a fund was affected by
investors buying and selling shares (as opposed to changes due to fund
performance, shown above in "Operations").
**The information shows how many shares the fund sold to investors, how many
shares the fund issued in connection with investors who reinvested their
dividends or distributions, and how many shares the fund redeemed (bought back
from investors).
In funds with more than one share class, these figures are reported by class.
***These are the figures for the current report period.
****These are the figures for the previous report period.
#For mutual funds, the number of "shares outstanding" is the number of shares in
existence.
146
<PAGE> 151
GLOSSARY
ASSET ALLOCATION The practice of dividing a portfolio among different asset
classes, with each asset class assigned a particular percentage.
ASSET CLASS A group of securities with similar structure and basic
characteristics. Stocks, bonds and cash are the three main examples of asset
classes.
BETA A historical measure of an investment's volatility relative to a market
index (usually the S&P 500). The index is defined as having a beta of 1.00.
Investments with a beta higher than 1.00 have been more volatile than the index;
those with a beta of less than 1.00 have been less volatile.
BOND A security representing a loan from the investor to the issuer. A bond
typically pays interest at a fixed rate (the "coupon rate") until a specified
date (the "maturity date"), at which time the issuer returns the money borrowed
("principal" or "face value") to the bondholder. Because of their structure,
bonds are sometimes called "fixed income securities" or "debt securities."
CAP, CAPITALIZATION See "market cap."
CAPITAL GAIN, CAPITAL LOSS The difference between the amount paid for an
investment and its value at a later time. If the investment has been sold, the
capital gain or loss is considered a realized gain or loss. If the investment is
still held, the gain or loss is still "on paper" and is considered unrealized.
EARNINGS GROWTH RATE For a mutual fund, the average yearly rate at which the
earnings of the companies in the fund's portfolio have grown, measured over the
past five years.
EARNINGS PER SHARE (EPS) A company's earnings, or net income, for the past 12
months, divided by the number of shares outstanding.
EXPENSE RATIO The amount that is taken from a mutual fund's assets each year to
cover the fund's operating expenses. An expense ratio of 0.50% means that a
fund's expenses amount to half of one percent of its average net assets a year.
MARKET CAP, MARKET CAPITALIZATION The value of a company as determined by the
total value of all shares of its stock outstanding.
MEDIAN MARKET CAP The midpoint of the range of market caps of the stocks held by
a fund. There are different ways of calculating median market cap. With a simple
median, half of the stocks in the fund's portfolio would be larger than the
median, and half would be smaller. With a weighted median (the type that is
calculated for these funds), half of the fund's assets are invested in stocks
that are larger than the median market cap, and half in stocks that are smaller.
NET ASSET VALUE (NAV) The value of one share of a mutual fund. NAV is calculated
by taking the fund's total assets, subtracting liabilities, and dividing by the
number of shares outstanding.
OUTSTANDING SHARES, SHARES OUTSTANDING When speaking of a company or mutual
fund, indicates all shares currently held by investors.
PRICE-TO-BOOK RATIO (P/B) The market price of a company's stock compared with
its "book value." A mutual fund's P/B is the weighted average of the P/B of all
stocks in the fund's portfolio.
PRICE-TO-EARNINGS RATIO (P/E) The market price of a company's stock compared
with earnings over the past year. A mutual fund's P/E is the weighted average of
the P/E of all stocks in the fund's portfolio.
RETURN ON EQUITY (ROE) The average yearly rate of return for each dollar of
investors' money, measured over the past five years.
STOCK A share of ownership, or equity, in the issuing company.
TOTAL RETURN The overall performance of an investment over a given period,
including any expenses, any income or distributions paid out and any capital
gain or loss (increases or decreases in portfolio value).
WEIGHTED AVERAGE For mutual funds, an average that gives the same weight to each
security as the security represents in the fund's portfolio.
YIELD The income paid out by an investment, expressed as a percentage of the
investment's market value.
147
<PAGE> 152
NOTES
<PAGE> 153
NOTES
<PAGE> 154
NOTES
<PAGE> 155
CONTACT SCHWAB
The SchwabFunds(R) 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
market funds.
Please call 1-800-435-4000 for a free prospectus and brochure for any of these
SchwabFunds.
This report must be preceded or accompanied by a current prospectus.
METHODS FOR PLACING ORDERS
The following information outlines how Schwab brokerage account investors can
place orders. If you are investing through a third-party investment provider,
methods for placing orders may be different.
INTERNET
www.schwab.com
SCHWAB BY PHONE(TM)
Use our automated voice service or speak to a representative. Call
1-800-435-4000, day or night (for TDD service, call 1-800-345-2550).
TELEBROKER(R)
Automated touch-tone phone service at 1-800-272-4922
MAIL
Write to SchwabFunds at:
P. O. Box 7575
San Francisco, CA 94120-7575
When selling or exchanging shares, be sure to include the signatures of at least
one of the persons whose name is on the account.
THE SCHWABFUNDS FAMILY
EQUITY INDEX FUNDS
Schwab S&P 500 Fund
Schwab 1000 Fund(R)
Schwab Small-Cap Index Fund(R)
Schwab Total Stock Market Index Fund(TM)
Schwab International Index Fund(R)
QUANTITATIVE/SECTOR FUNDS
Schwab Analytics Fund(R)
Schwab Focus Funds
Communications Focus Fund
Financial Services Focus Fund
Health Care Focus Fund
Technology Focus Fund
ASSET ALLOCATION FUNDS
Schwab MarketTrack Portfolios(R)
All Equity Portfolio
Growth Portfolio
Balanced Portfolio
Conservative Portfolio
Schwab MarketManager Portfolios(R)
Growth Portfolio
Balanced Portfolio
Small Cap Portfolio
International Portfolio
BOND FUNDS
Schwab Short-Term Bond Market Index Fund
Schwab Total Bond Market Index Fund
Schwab YieldPlus Fund(TM)
Schwab Short/Intermediate Tax-Free Bond Fund
Schwab Long-Term Tax-Free Bond Fund
Schwab California Short/Intermediate Tax-Free Bond Fund
Schwab California Long-Term Tax-Free Bond Fund
SCHWAB MONEY FUNDS
Schwab offers an array of money market funds that seek high current income
consistent with safety and liquidity. 1 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 Value Advantage Investments.(R)
1 Investments in money market funds are neither insured nor guaranteed by the
Federal Deposit Insurance Corporation (FDIC) or any other government agency
and, although they seek to preserve the value of your investment at $1 per
share, it is possible to lose money.
<PAGE> 156
CHARLESSCHWAB
INVESTMENT ADVISER
Charles Schwab Investment Management, Inc.
101 Montgomery Street, San Francisco, CA 94104
DISTRIBUTOR
Charles Schwab & Co., Inc.
PO Box 7575, San Francisco, CA 94120-7575
This report is not authorized for distribution to prospective investors unless
preceded or accompanied by a current prospectus.
(C) 2000 Charles Schwab & Co., Inc. All rights reserved.
Member SIPC/NYSE.
Printed on recycled paper. MKT3810-3 (12/00)
