Morningstar Rating

ETF Research and Analysis

by Abby Woodham
Suitability
After lowering its expense ratio to just 0.07%, Schwab US TIPS ETF SCHP is the cheapest ETF for buying Treasury Inflation-Protected Securities. Over time, SCHP’s lower expense ratio may give it the edge over major competitor   Read more 

Bull Case

SCHP is the cheapest TIPS ETF.
TIPS ETFs let investors hedge against unexpected inflation: the possibility that the future rate of inflation is higher than the market expects.
After their price decline in 2013, TIPS now offer cheaper inflation hedging than in recent years. Read more 

Bear Case

SCHP is not meaningfully correlated with inflation. An investment in SCHP will not guarantee preserved purchasing power over any time period.
SCHP's long duration means it is exposed to interest-rate risk.
If the market overestimates the future rate of inflation, Treasuries will outperform TIPS. Read more 

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Broad Fixed-Income Exposure At a Low Cost 
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