Schwab (CHARLES) Corp. (The) Stock Price, News & Analysis

Charles Schwab has announced its Fall Business Update for institutional investors, scheduled for Tuesday, October 15th. This event is part of an ongoing series aimed at keeping the investment community informed about recent developments and management's strategic focus. The update will be held via live public webcast from 7:30 a.m. to 8:30 a.m. CT (8:30 a.m. to 9:30 a.m. ET).

Key participants in the update will include Co-Chairman and CEO Walt Bettinger, President Rick Wurster, CFO Mike Verdeschi, and Managing Director Peter Crawford. Interested parties can access the webcast at https://schwabevents.com/.

Schwab Advisor Services™ is set to host its 34th annual IMPACT® conference in San Francisco, the largest gathering of registered investment advisors (RIAs) in the nation. The event, scheduled for November 19-21, 2024, will feature keynote presentations, education sessions, and headline speakers, focusing on practice management, leadership, investment strategies, and client experience.

Attendees will hear from industry experts, including New York Times Bestselling Author Daniel Pink, AI experts Ethan Mollick and Allie K. Miller, and Schwab's senior leadership team. The conference will also include 80 higher education students and professors, participating in a Student Union space on the show floor. Jon Beatty, head of Schwab Advisor Services, emphasized the event's role in showcasing the power and promise of the RIA industry.

Charles Schwab 's August 2024 Monthly Activity Report highlights significant growth and positive trends. Core net new assets increased to $32.8 billion, up from $4.9 billion in August 2023. Total client assets reached $9.74 trillion, a 20% increase year-over-year. New brokerage accounts grew by 4% compared to August 2023, totaling 324,000.

Despite typical August seasonality, transactional sweep cash declined modestly to $366.8 billion, showing improvement over previous years. The company anticipates third-quarter results to align with July's Business Update, projecting 2-3% revenue growth and an adjusted pre-tax profit margin of at least 40%. These results reflect healthy investor engagement and slowing rate-related client cash realignment activity.

The Schwab Trading Activity Index™ (STAX) decreased to 53.16 in August from 54.81 in July, indicating moderate trading activity among Schwab clients. Investors were net sellers of equities, particularly in Communication Services, Health Care, and Information Technology sectors, while net buying Consumer Discretionary and Energy. This shift suggests a rotation from equities to fixed income as a de-risking strategy.

Despite market volatility, including a significant sell-off in early August, major indices showed resilience. The Dow Jones Industrial Average reached a new high of 41,585.21 on August 30. Economic indicators were mixed, with softer-than-expected jobs data and inflation metrics coming in slightly below expectations. The 10-year Treasury yield fell by 6.88% to 3.911%, while the US Dollar Index declined by 2.51% to 101.70.

The latest Charles Schwab Trader Sentiment Survey reveals a surge in trader optimism, with 56% reporting a bullish outlook for the next three months, up 10 points from Q2. Nearly 60% of traders believe it's a good time to invest, and over half feel financially better off compared to last year. Inflation concerns have decreased, while expectations for Fed rate cuts have increased.

Traders favor AI stocks (62%) and are most bullish on the Information Technology sector (61%). The survey also highlights increased positive sentiment towards growth stocks, mega-cap tech, and domestic stocks. As the 2024 presidential election approaches, 94% of traders believe it will impact financial markets, with 44% reducing portfolio risk in preparation.

Charles Schwab's 2024 Modern Wealth Survey reveals that Americans now consider $2.5 million as the threshold for being wealthy, up from $2.2 million in 2023. The survey also shows that $778,000 is the average net worth required to be financially comfortable. Notably, Boomers have the highest wealth threshold at $2.8 million, while Gen Z has the lowest at $1.2 million.

Geographically, San Francisco leads with a $4.4 million wealth threshold, followed by Southern California at $3.4 million. The survey also found that 21% of Americans believe they're on track to become wealthy, with Millennials and Gen Z being the most optimistic at 29%. However, only 18% of Americans feel they're currently on top of their finances. Those with a financial plan in place tend to give themselves higher grades in personal finance areas such as savings, investments, and retirement preparedness.

Charles Schwab 's July 2024 Monthly Activity Report reveals strong performance and growth. Core net new assets reached $29.0 billion, more than doubling July 2023 levels. Total client assets hit $9.57 trillion, up 16% year-over-year and 2% month-over-month. New brokerage accounts increased by 327,000, showing 8% and 5% growth compared to July 2023 and June 2024, respectively.

While transactional sweep cash slightly decreased to $371.8 billion (down 1% from June 2024), client market engagement remained robust. The combined decline in bank sweep deposits and broker-dealer cash balances was less than $1 billion month-over-month, indicating stable cash management despite market activity.

Schwab Advisor Services and Charles Schwab Foundation have announced the 13 recipients of the 2024 Registered Investment Advisor (RIA) Talent Advantage Student Scholarship. Each recipient will receive $10,000 to support their 2024-2025 academic year and be paired with an RIA leader for mentoring. The initiative aims to increase access to the advisory profession by reducing financial obstacles and maximizing learning for future leaders.

Over 500 students from 100+ universities applied, with applications vetted by RIA firm leaders on Schwab's Diversity, Equity & Inclusion Advocacy Board. The 2024 RIA Benchmarking Study highlighted a need for 70,000 new staff in the industry over the next five years. Schwab's efforts, including the RIATA Scholarship and the Student Program at the 2024 IMPACT Conference, aim to support, educate, and mentor the industry's future talent.

The Schwab Ultra-Short Income ETF (NYSE Arca: SCUS) has commenced trading, marking Schwab Asset Management's first actively managed fixed income ETF. With an expense ratio of 0.14%, SCUS is priced competitively below the industry average of 0.25%. The ETF aims to provide current income while preserving capital and maintaining liquidity.

SCUS invests in investment grade, short-term, U.S. dollar denominated debt securities from both U.S. and foreign issuers. The fund maintains a portfolio duration of one year or less, focusing on ultra-short-term investments. This new offering expands Schwab's ETF lineup, potentially appealing to investors seeking low-risk, income-generating options in the current market environment.