Schwab Core Equity Fund (SWANX) N-CSRS Certified semi-annual shareholder report (management investment company)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT
OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-7704

Schwab Capital Trust

(Exact name of registrant as specified in charter)

211 Main Street, San Francisco, California 94105

(Address of principal executive offices) (Zip code)

Marie Chandoha
Schwab Capital Trust
211 Main Street, San Francisco, California 94105

(Name and address of agent for service)

Registrant’s telephone number, including area code: (415) 636-7000

Date of fiscal year end: October 31

Date of reporting period: April 30, 2013

Item 1: Report(s) to Shareholders.

Semiannual report dated April 30, 2013, enclosed.

Schwab Equity Index Funds

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market

Index Fund^®

Schwab International

Index Fund^®

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This wrapper is not part of the shareholder report.

Schwab Equity Index Funds

Semiannual Report

April 30, 2013

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market

Index Fund^®

Schwab International

Index Fund^®

This page is intentionally left blank.

Five cost-efficient ways to tap into the power of

the stock market for long-term growth potential.

In This Report

Performance at a Glance	2
From the President	3
Fund Management	5
Performance and Fund Facts
Schwab® S&P 500 Index Fund	6
Schwab 1000 Index® Fund	7
Schwab Small-Cap Index Fund®	8
Schwab Total Stock Market Index Fund®	9
Schwab International Index Fund®	10
Fund Expenses	12
Financial Statements and Portfolio Holdings
Schwab® S&P 500 Index Fund	13
Schwab 1000 Index® Fund	20
Schwab Small-Cap Index Fund®	27
Schwab Total Stock Market Index Fund®	34
Schwab International Index Fund®	41
Financial Notes	49
Trustees and Officers	59
Glossary	62
EX-99.CERT
EX-99.906CERT

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM).
Distributor: Charles Schwab & Co., Inc. (Schwab).

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS), which was developed by, and is the exclusive property of, MSCI and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the schedules of Portfolio Holdings are sub-categories of Sector classifications.

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 2013
Schwab® S&P 500 Index Fund (Ticker Symbol: SWPPX)	14.39%
S&P 500® Index	14.42%
Fund Category: Morningstar Large-Cap Blend	14.54%
Performance Details	page 6
Schwab 1000 Index® Fund (Ticker Symbol: SNXFX)	14.78%
Schwab 1000 Index®	14.94%
Fund Category: Morningstar Large-Cap Blend	14.54%
Performance Details	page 7
Schwab Small-Cap Index Fund® (Ticker Symbol: SWSSX)	16.55%
Russell 2000® Index	16.58%
Fund Category: Morningstar Small-Cap Blend	16.46%
Performance Details	page 8
Schwab Total Stock Market Index Fund® (Ticker Symbol: SWTSX)	15.07%
Dow Jones U.S. Total Stock Market IndexSM	15.16%
Fund Category: Morningstar Large-Cap Blend	14.54%
Performance Details	page 9
Schwab International Index Fund®1 (Ticker Symbol: SWISX)	16.69%
MSCI EAFE Index® (Net)*	16.90%
Fund Category: Morningstar Foreign Large-Cap Blend	14.02%
Performance Details	pages 10-11

Minimum Initial Investment² $ 100

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

*	Effective February 28, 2013, the fund changed its comparative index, for purposes of performance calculation, from MSCI EAFE Index (Gross) to MSCI EAFE Index (Net). The net version of the index more accurately reflects how dividends paid to the fund on its foreign securities are treated for tax purposes and provides a better basis for comparing the fund’s performance. The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
1	The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations, see financial note 2 for more information.
2	Please see the funds’ prospectus for further detail and eligibility requirements.

2 Schwab Equity Index Funds

From the President

Marie Chandoha is President and CEO of Charles Schwab Investment Management, Inc. and the funds covered in this report.

Dear Shareholder,

As President and CEO of Charles Schwab Investment Management, Inc., I’d like to thank you for trusting us to help you meet your investment goals, and for reading this important report concerning the Schwab Equity Index Funds. The funds employ an indexing strategy to track the performance of a particular stock market benchmark, seeking returns by modeling portfolios according to each fund’s respective index.

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets. The backdrop for these performances included efforts undertaken by the Federal Reserve and many central banks around the world to stimulate faster economic growth by keeping interest rates low. This was particularly the case in Japan, where aggressive central bank policies helped fuel a rally by stocks, while the yen depreciated sharply versus the U.S. dollar. In general, stocks benefited from these policies and from some signs of improvement in the U.S. housing market. Reduced concerns about the euro zone’s sovereign debt crisis and the U.S. fiscal cliff also played a supportive role.

Many major stock market indices in the U.S. finished at or near record highs. Across equity markets, mid-cap stocks generally provided larger returns than small- and large-cap stocks. Value stocks narrowly trailed growth stocks over the last half of the report period, but generated higher overall returns for the entire six months. Reflecting this environment, the S&P 500 Index returned 14.4% and the MSCI EAFE Index (net) returned 16.9%.

 Asset Class Performance Comparison % returns during the report period

This graph compares the performance of various asset classes during the report period. Final performance figures for the period are in the key below.

	14.42%	S&P 500® Index: measures U.S. large-cap stocks
	16.58%	Russell 2000® Index: measures U.S. small-cap stocks
	17.18%	MSCI EAFE® Index (Gross): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	0.90%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.04%	Three-Month U.S. Treasury Bills (T-bills): measures short-term U.S. Treasury obligations

Index figures assume dividends and distributions were reinvested, and do not include trading and management costs, which would lower performance. Indices are unmanaged, do not incur management fees, costs and expenses, and you cannot invest in them directly. Remember that past performance is not an indication of future results.

Data source: Index provider websites and CSIM.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views and portfolio holdings may have changed since the report date.

Schwab Equity Index Funds 3

From the President continued

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets.

For more information about the Schwab Equity Index Funds, please continue reading this report. In addition, you can find answers to frequently asked questions and more details about the funds by visiting www.schwabfunds.com. We are also happy to hear from you at 1-800-435-4000.

Sincerely,

4 Schwab Equity Index Funds

Fund Management

	Agnes Hong, CFA, Managing Director and Head of Passive Equity Strategies, leads the portfolio management teams of Schwab’s index mutual funds and equity ETFs. She also has overall responsibility for all aspects of the management of the funds. Prior to joining CSIM in 2009, Ms. Hong spent five years as a portfolio manager at Barclays Global Investors (subsequently acquired by BlackRock), where she managed institutional index funds and quantitative active funds. Prior to that, Ms. Hong worked in management consulting and product management, servicing global financial services clients.
	Ferian Juwono, CFA, Managing Director and Senior Portfolio Manager, is responsible for the day-to-day co-management of the funds. Prior to joining CSIM in 2010, Mr. Juwono worked at BlackRock (formerly Barclays Global Investors), where he spent over three years as a portfolio manager, managing equity index funds for institutional clients, and nearly two years as a senior business analyst. Prior to that, Mr. Juwono worked for over four years as a senior financial analyst with Union Bank of California.
	Ron Toll, Portfolio Manager, is responsible for the day-to-day co-management of each of the funds, except for the Schwab Total Stock Market Index Fund. Mr. Toll has been a portfolio manager with CSIM since 2007, and has held a number of positions at the firm since beginning his tenure in 1998. His previous roles included serving as a manager in Portfolio Operations, and as a manager in Portfolio Operations and Analytics.

Schwab Equity Index Funds 5

Schwab^® S&P 500 Index Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab® S&P 500 Index Fund (5/19/97)		14.39	%		16.79	%		5.25	%		7.83	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Large-Cap Blend		14.54	%		15.95	%		4.18	%		7.49	%

Fund Expense Ratios³: Net 0.09%; Gross 0.10%

 Statistics

Number of Holdings	502
Weighted Average Market Cap ($ x 1,000,000)	$105,731
Price/Earnings Ratio (P/E)	15.6
Price/Book Ratio (P/B)	2.5
Portfolio Turnover Rate4	0%

 Sector Weightings % of Investments

Information Technology	17.3%
Financials	15.6%
Health Care	12.4%
Consumer Discretionary	11.4%
Consumer Staples	10.8%
Energy	10.3%
Industrials	9.6%
Utilities	3.5%
Materials	3.3%
Telecommunication Services	3.0%
Other	2.8%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Apple, Inc.	2.8%
Exxon Mobil Corp.	2.7%
Microsoft Corp.	1.7%
Johnson & Johnson	1.6%
Chevron Corp.	1.6%
General Electric Co.	1.6%
Google, Inc., Class A	1.5%
International Business Machines Corp.	1.4%
Pfizer, Inc.	1.4%
The Procter & Gamble Co.	1.4%
Total	17.7%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Standard & Poor’s^® S&P^®, S&P 500^®, 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 Index Fund. The Schwab S&P 500 Index 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.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	On September 9, 2009, the Investor Share class, Select Share class and e.Shares class were combined into a single class of shares of the fund. The performance history of the fund prior to September 9, 2009 is that of the fund’s former Select Shares. On September 9, 2009, the Schwab Institutional Select S&P 500 Fund merged into the fund.
3	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
4	Not annualized. Less than 1%.
5	This list is not a recommendation of any security by the investment adviser.

6 Schwab Equity Index Funds

Schwab 1000 Index^® Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab 1000 Index® Fund (4/2/91)		14.78	%		16.55	%		5.27	%		8.01	%
Schwab 1000 Index®		14.94	%		16.85	%		5.47	%		8.33	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Large-Cap Blend		14.54	%		15.95	%		4.18	%		7.49	%

Fund Expense Ratios³: Net 0.29%; Gross 0.34%

 Statistics

Number of Holdings	996
Weighted Average Market Cap ($ x 1,000,000)	$93,223
Price/Earnings Ratio (P/E)	16.5
Price/Book Ratio (P/B)	2.5
Portfolio Turnover Rate4	3%

 Sector Weightings % of Investments

Information Technology	17.2%
Financials	16.7%
Consumer Discretionary	12.4%
Health Care	12.3%
Industrials	10.6%
Energy	10.2%
Consumer Staples	10.1%
Utilities	3.7%
Materials	3.7%
Telecommunication Services	2.8%
Other	0.3%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Apple, Inc.	2.5%
Exxon Mobil Corp.	2.4%
Microsoft Corp.	1.5%
Chevron Corp.	1.5%
Johnson & Johnson	1.5%
General Electric Co.	1.4%
Google, Inc., Class A	1.3%
International Business Machines Corp.	1.3%
Pfizer, Inc.	1.3%
The Procter & Gamble Co.	1.3%
Total	16.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	On September 18, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to September 18, 2009 is that of the fund’s former Investor Shares.
3	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
4	Not annualized.
5	This list is not a recommendation of any security by the investment adviser.

Schwab Equity Index Funds 7

Schwab Small-Cap Index Fund^®

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab Small-Cap Index Fund® (5/19/97)		16.55	%		17.77	%		8.21	%		11.05	%
Russell 2000® Index		16.58	%		17.69	%		7.27	%		10.47	%
Small-Cap Spliced Index3		16.58	%		17.69	%		8.31	%		11.16	%
Fund Category: Morningstar Small-Cap Blend		16.46	%		16.46	%		6.68	%		10.19	%

Fund Expense Ratios⁴: Net 0.17%; Gross 0.21%

 Statistics

Number of Holdings	1,957
Weighted Average Market Cap ($ x 1,000,000)	$1,572
Price/Earnings Ratio (P/E)	21.2
Price/Book Ratio (P/B)	2.1
Portfolio Turnover Rate5	2%

 Sector Weightings % of Investments

Financials	23.2%
Information Technology	15.7%
Industrials	14.4%
Consumer Discretionary	13.8%
Health Care	12.1%
Energy	5.8%
Materials	4.9%
Consumer Staples	3.6%
Utilities	3.4%
Telecommunication Services	0.7%
Other	2.4%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Pharmacyclics, Inc.	0.3%
Starwood Property Trust, Inc.	0.3%
Alaska Air Group, Inc.	0.3%
Two Harbors Investment Corp.	0.3%
Gulfport Energy Corp.	0.3%
Ocwen Financial Corp.	0.3%
Alkermes plc	0.3%
Genesee & Wyoming, Inc., Class A	0.3%
Omega Healthcare Investors, Inc.	0.3%
Axiall Corp.	0.3%
Total	3.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Index ownership – “Russell 2000^®” is a registered mark of the Frank Russell Company (“Russell”) and has been licensed for use by the Schwab Small-Cap Index Fund. The Schwab Small-Cap Index Fund is not sponsored, endorsed, sold or promoted by Russell and Russell makes no representation regarding the advisability of investing in the fund.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Small-company stocks are subject to greater volatility than other asset classes.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	On August 21, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to August 21, 2009 is that of the fund’s former Select Shares.
3	The Small-Cap Spliced Index is an internally calculated index, comprised of the Schwab Small-Cap Index (the fund’s former comparative index) from inception of the fund until the close of business on December 14, 2011, and the Russell 2000 Index from December 15, 2011 forward.
4	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.

8 Schwab Equity Index Funds

Schwab Total Stock Market Index Fund^®

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab Total Stock Market Index Fund® (6/1/99)		15.07	%		17.11	%		5.93	%		8.73	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		8.75	%
Fund Category: Morningstar Large-Cap Blend		14.54	%		15.95	%		4.18	%		7.49	%

Fund Expense Ratios³: Net 0.09%; Gross 0.10%

 Statistics

Number of Holdings	2,453
Weighted Average Market Cap ($ x 1,000,000)	$86,656
Price/Earnings Ratio (P/E)	17.0
Price/Book Ratio (P/B)	2.4
Portfolio Turnover Rate4	1%

 Sector Weightings % of Investments

Financials	17.2%
Information Technology	16.9%
Consumer Discretionary	12.4%
Health Care	12.1%
Industrials	10.6%
Energy	9.6%
Consumer Staples	9.4%
Materials	3.7%
Utilities	3.6%
Telecommunication Services	2.7%
Other	1.8%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Apple, Inc.	2.3%
Exxon Mobil Corp.	2.2%
Microsoft Corp.	1.4%
Johnson & Johnson	1.3%
Chevron Corp.	1.3%
General Electric Co.	1.3%
Google, Inc., Class A	1.2%
International Business Machines Corp.	1.2%
The Procter & Gamble Co.	1.2%
Pfizer, Inc.	1.2%
Total	14.6%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

“Dow Jones” and “The Dow Jones U.S. Total Stock Market Index^SM” are service marks of Dow Jones & Company, Inc. and have been licensed for certain purposes by CSIM. The Schwab Total Stock Market Index Fund, based on The Dow Jones U.S. Total Stock Market Index^SM, is not sponsored, endorsed, sold or promoted by Dow Jones and Dow Jones makes no representation regarding the advisability of investing in such a product.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	On September 18, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to September 18, 2009 is that of the fund’s former Select Shares.
3	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
4	Not annualized.
5	This list is not a recommendation of any security by the investment adviser.

Schwab Equity Index Funds 9

Schwab International Index Fund^®

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab International Index Fund® (5/19/97)		16.69	%		19.54	%		-0.96	%		9.00	%
MSCI EAFE Index® (Net)3		16.90	%		19.39	%		-0.93	%		9.23	%
MSCI EAFE Index® (Gross)3		17.18	%		19.96	%		-0.44	%		9.72	%
International Spliced Index4		16.98	%		19.76	%		-0.87	%		9.24	%
Fund Category: Morningstar Foreign Large-Cap Blend		14.02	%		15.45	%		-1.30	%		8.69	%

Fund Expense Ratios⁵: Net 0.19%; Gross 0.23%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

The fund’s performance relative to the index may be affected by fair-value pricing, see financial note 2 for more information.

Index ownership — “MSCI EAFE” is a registered mark of MSCI and has been licensed for use by the Schwab International Index Fund. The Schwab International Index Fund is not sponsored, endorsed, sold or promoted by MSCI and MSCI bears no liability with respect to the fund. The Statement of Additional Information contains a more detailed description of the limited relationship MSCI has with the fund.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	On August 21, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to August 21, 2009 is that of the fund’s former Select Shares.
3	Effective February 28, 2013, the fund changed its comparative index, for purposes of performance calculation, from MSCI EAFE Index (Gross) to MSCI EAFE Index (Net). The net version of the index more accurately reflects how dividends paid to the fund on its foreign securities are treated for tax purposes and provides a better basis for comparing the fund’s performance. The net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes.
4	The International Spliced Index is an internally calculated index, comprised of the Schwab International Index (the fund’s former comparative index) from inception of the fund until the close of business on December 20, 2011, the MSCI EAFE Index (Gross) from December 21, 2011 until the close of business on February 28, 2013, and the MSCI EAFE Index (Net) from March 1, 2013 forward.
5	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.

10 Schwab Equity Index Funds

 Schwab International Index Fund^®

Performance and Fund Facts as of 04/30/13 continued

 Statistics

Number of Holdings	920
Weighted Average Market Cap ($ x 1,000,000)	$58,292
Price/Earnings Ratio (P/E)	19.6
Price/Book Ratio (P/B)	1.0
Portfolio Turnover Rate1	5%

 Sector Weightings % of Investments

Financials	24.9%
Industrials	11.9%
Consumer Staples	11.7%
Consumer Discretionary	10.6%
Health Care	10.0%
Materials	8.2%
Energy	6.8%
Telecommunication Services	4.9%
Information Technology	4.2%
Utilities	3.7%
Other	3.1%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Nestle S.A. – Reg’d	1.9%
HSBC Holdings plc	1.6%
Roche Holding AG	1.4%
Novartis AG – Reg’d	1.4%
Toyota Motor Corp.	1.3%
Vodafone Group plc	1.2%
BP plc	1.1%
Sanofi	1.0%
Royal Dutch Shell plc, A Shares	1.0%
GlaxoSmithKline plc	1.0%
Total	12.9%

 Country Weightings % of Investments

Japan	21.4%
United Kingdom	20.8%
France	9.0%
Australia	8.9%
Switzerland	8.7%
Germany	8.0%
Sweden	3.1%
Hong Kong	3.0%
Spain	2.8%
Netherlands	2.3%
Other Countries	12.0%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Not annualized.
2	This list is not a recommendation of any security by the investment adviser.

Schwab Equity Index Funds 11

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you incur two types of costs: transaction costs, such as redemption fees, and ongoing costs, such as management fees, transfer agent and shareholder services fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in a fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning November 1, 2012 and held through April 30, 2013.

Actual Return lines in the table below provide information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ¸ $1,000 = 8.6), then multiply the result by the number given for your fund or share class under the heading entitled “Expenses Paid During Period.”

Hypothetical Return lines in the table below provide information about hypothetical account values and hypothetical expenses based on a fund’s or share class’ actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as redemption fees. If these transactional costs were included, your costs would have been higher.

					Ending
			Beginning		Account Value		Expenses Paid
	Expense Ratio1		Account Value		(Net of Expenses)		During Period2
	(Annualized)		at 11/1/12		at 4/30/13		11/1/12–4/30/13
Schwab® S&P 500 Index Fund
Actual Return		0.09%	$	1,000	$	1,143.90	$	0.48
Hypothetical 5% Return		0.09%	$	1,000	$	1,024.35	$	0.45
Schwab 1000 Index® Fund
Actual Return		0.29%	$	1,000	$	1,147.80	$	1.54
Hypothetical 5% Return		0.29%	$	1,000	$	1,023.36	$	1.45
Schwab Small-Cap Index Fund®
Actual Return		0.17%	$	1,000	$	1,165.50	$	0.91
Hypothetical 5% Return		0.17%	$	1,000	$	1,023.95	$	0.85
Schwab Total Stock Market Index Fund®
Actual Return		0.09%	$	1,000	$	1,150.70	$	0.48
Hypothetical 5% Return		0.09%	$	1,000	$	1,024.35	$	0.45
Schwab International Index Fund®
Actual Return		0.19%	$	1,000	$	1,166.90	$	1.02
Hypothetical 5% Return		0.19%	$	1,000	$	1,023.85	$	0.95

1	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.
2	Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year.

12 Schwab Equity Index Funds

Schwab^® S&P 500 Index Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		22.35			19.82			18.70			16.28			15.28			24.28
Income (loss) from investment operations:
Net investment income (loss)		0.26			0.44			0.39			0.35			0.20			0.44
Net realized and unrealized gains (losses)		2.89			2.49			1.09			2.31			1.22			(9.02	)
Total from investment operations		3.15			2.93			1.48			2.66			1.42			(8.58	)
Less distributions:
Distributions from net investment income		(0.49	)		(0.40	)		(0.36	)		(0.24	)		(0.42	)		(0.42	)
Net asset value at end of period		25.01			22.35			19.82			18.70			16.28			15.28
Total return (%)		14.39	2		15.09			7.97			16.50			9.81			(35.92	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.09	3		0.09			0.09			0.09			0.13	4		0.19
Gross operating expenses		0.09	3		0.10			0.10			0.10			0.16			0.21
Net investment income (loss)		2.26	3		2.09			1.96			1.97			2.09			2.06
Portfolio turnover rate		0	2,5		2			3			2			3	6		3
Net assets, end of period ($ x 1,000,000)		14,968			12,687			10,909			10,007			8,718			2,598

* Unaudited.

¹ Effective September 9, 2009, the Investor Share class, the e.Share class and the Select Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Not annualized.

³ Annualized.

⁴ Effective May 5, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁵ Less than 1%.

⁶ Portfolio turnover excludes the impact of investment activity resulting from a merger with another fund.

See financial notes 13

 Schwab S&P 500 Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.0%	Common Stock		9,633,343,832		14,527,448,671
	2	.8%	Short-Term Investments		413,721,414		413,721,414
	99	.8%	Total Investments		10,047,065,246		14,941,170,085
	0	.2%	Collateral Invested for Securities on Loan		22,835,155		22,835,155
	0	.0%	Other Assets and Liabilities, Net				3,914,977
	100	.0%	Net Assets				14,967,920,217

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 97.0% of net assets
Automobiles & Components 0.8%
Other Securities				0.8		117,883,191
Banks 2.7%
Wells Fargo & Co.		4,998,909		1.3		189,858,564
Other Securities				1.4		215,949,867
				2.7		405,808,431
Capital Goods 7.3%
3M Co.		647,319		0.5		67,780,772
General Electric Co.		10,604,052		1.6		236,364,319
The Boeing Co.		694,054		0.4		63,443,476
United Technologies Corp.		860,035		0.5		78,512,595
Other Securities				4.3		642,339,034
				7.3		1,088,440,196
Commercial & Professional Supplies 0.6%
Other Securities				0.6		97,433,935
Consumer Durables & Apparel 1.2%
Other Securities				1.2		177,524,864
Consumer Services 1.8%
McDonald’s Corp.		1,022,638		0.7		104,452,245
Other Securities				1.1		168,960,613
				1.8		273,412,858
Diversified Financials 6.6%
American Express Co.		973,041		0.4		66,565,735
Bank of America Corp.		11,034,411		0.9		135,833,599
Citigroup, Inc.		3,098,847		1.0		144,592,201
JPMorgan Chase & Co.		3,903,231		1.3		191,297,351
The Charles Schwab Corp. (a)		1,085,681		0.1		18,413,150
The Goldman Sachs Group, Inc.		446,969		0.4		65,288,762
Other Securities				2.5		362,466,145
				6.6		984,456,943
Energy 10.3%
Chevron Corp.		1,981,134		1.6		241,718,160
ConocoPhillips		1,245,190		0.5		75,271,735
Exxon Mobil Corp.		4,568,741		2.7		406,572,262
Occidental Petroleum Corp.		820,950		0.5		73,277,997
Schlumberger Ltd.		1,354,515		0.7		100,816,551
Other Securities				4.3		645,432,236
				10.3		1,543,088,941
Food & Staples Retailing 2.4%
CVS Caremark Corp.		1,258,851		0.5		73,239,951
Wal-Mart Stores, Inc.		1,705,702		0.9		132,567,159
Other Securities				1.0		151,715,628
				2.4		357,522,738
Food, Beverage & Tobacco 6.0%
Altria Group, Inc.		2,034,491		0.5		74,279,266
PepsiCo, Inc.		1,573,263		0.9		129,747,000
Philip Morris International, Inc.		1,675,746		1.1		160,184,560
The Coca-Cola Co.		3,908,656		1.1		165,453,409
Other Securities				2.4		374,620,695
				6.0		904,284,930
Health Care Equipment & Services 4.0%
Other Securities				4.0		602,871,172
Household & Personal Products 2.3%
The Procter & Gamble Co.		2,785,690		1.4		213,857,422
Other Securities				0.9		132,861,523
				2.3		346,718,945
Insurance 4.1%
Berkshire Hathaway, Inc., Class B *		1,860,030		1.3		197,758,389
Other Securities				2.8		411,880,719
				4.1		609,639,108
Materials 3.3%
Other Securities				3.3		491,974,954

14 See financial notes

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Media 3.5%
Comcast Corp., Class A		2,688,164		0.7		111,021,173
The Walt Disney Co.		1,841,183		0.8		115,699,940
Other Securities				2.0		295,825,011
				3.5		522,546,124
Pharmaceuticals, Biotechnology & Life Sciences 8.4%
AbbVie, Inc.		1,613,186		0.5		74,287,215
Amgen, Inc.		771,159		0.5		80,362,479
Bristol-Myers Squibb Co.		1,659,364		0.4		65,909,938
Gilead Sciences, Inc. *		1,552,550		0.5		78,621,132
Johnson & Johnson		2,850,625		1.6		242,958,769
Merck & Co., Inc.		3,082,214		1.0		144,864,058
Pfizer, Inc.		7,357,733		1.4		213,889,298
Other Securities				2.5		349,344,727
				8.4		1,250,237,616
Real Estate 2.2%
Other Securities				2.2		332,367,802
Retailing 4.1%
Amazon.com, Inc. *		370,880		0.6		94,133,053
The Home Depot, Inc.		1,524,750		0.7		111,840,412
Other Securities				2.8		408,197,177
				4.1		614,170,642
Semiconductors & Semiconductor Equipment 2.0%
Intel Corp.		5,043,905		0.8		120,801,525
Other Securities				1.2		174,668,016
				2.0		295,469,541
Software & Services 9.2%
Google, Inc., Class A *		272,310		1.5		224,538,657
International Business Machines Corp.		1,069,390		1.4		216,594,250
Microsoft Corp.		7,687,731		1.7		254,463,896
Oracle Corp.		3,752,586		0.8		123,009,769
Visa, Inc., Class A		525,900		0.6		88,593,114
Other Securities				3.2		468,846,950
				9.2		1,376,046,636
Technology Hardware & Equipment 6.1%
Apple, Inc.		957,638		2.8		423,994,224
Cisco Systems, Inc.		5,437,428		0.8		113,750,994
QUALCOMM, Inc.		1,752,165		0.7		107,968,407
Other Securities				1.8		272,749,682
				6.1		918,463,307
Telecommunication Services 3.0%
AT&T, Inc.		5,600,236		1.4		209,784,841
Verizon Communications, Inc.		2,914,878		1.0		157,141,073
Other Securities				0.6		77,845,540
				3.0		444,771,454
Transportation 1.6%
Union Pacific Corp.		478,075		0.5		70,735,977
Other Securities				1.1		171,968,278
				1.6		242,704,255
Utilities 3.5%
Other Securities				3.5		529,610,088
Total Common Stock
(Cost $9,633,343,832)						14,527,448,671
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 2.8% of net assets
Time Deposits 2.6%
ANZ
0.03%, 05/01/13		73,313,151		0.5		73,313,151
Skandinaviska Enskilda Banken
0.03%, 05/01/13		69,730,862		0.5		69,730,862
Societe Generale
0.03%, 05/01/13		164,340,451		1.1		164,340,451
Other Securities				0.5		83,039,694
				2.6		390,424,158
U.S. Treasury Obligations 0.2%
Other Securities				0.2		23,297,256
Total Short-Term Investments
(Cost $413,721,414)						413,721,414
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.2% of net assets
Wells Fargo Advantage Government Money Market Fund		22,835,155		0.2		22,835,155
Total Collateral Invested for Securities on Loan
(Cost $22,835,155)						22,835,155
End of Collateral Invested for Securities on Loan.

At 04/30/13, tax basis cost of the fund’s investments was $10,091,186,702 and the unrealized appreciation and depreciation were $5,734,490,807 and ($884,507,424), respectively, with a net unrealized appreciation of $4,849,983,383.

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	All or a portion of this security is on loan.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

See financial notes 15

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		5,100		406,011,000		12,275,825

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$14,527,448,671		$—		$—		$14,527,448,671
Short-Term Investments1		—		413,721,414		—		413,721,414
Total		$14,527,448,671		$413,721,414		$—		$14,941,170,085
Other Financial Instruments
Collateral Invested for Securities on Loan		$22,835,155		$—		$—		$22,835,155
Futures Contract2		12,275,825		—		—		12,275,825

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

16 See financial notes

 Schwab S&P 500 Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated issuers, at value (cost $12,551,700)		$18,413,150
Investments in unaffiliated issuers, at value (cost $10,034,513,546) including securities on loan of $21,933,147	+	14,922,756,935
Total investments, at value (cost $10,047,065,246)		14,941,170,085
Collateral invested for securities on loan		22,835,155
Receivables:
Investments sold		3,729,086
Fund shares sold		39,085,790
Dividends		13,106,731
Due from broker for futures		1,020,000
Income from securities on loan		27,887
Foreign tax reclaims		25,002
Interest		325
Prepaid expenses	+	143,347
Total assets		15,021,143,408
Liabilities
Collateral held for securities on loan		22,835,155
Payables:
Investments bought		16,134,750
Investment adviser and administrator fees		74,587
Shareholder service fees		25,949
Fund shares redeemed		13,849,238
Accrued expenses	+	303,512
Total liabilities		53,223,191
Net Assets
Total assets		15,021,143,408
Total liabilities	−	53,223,191
Net assets		$14,967,920,217
Net Assets by Source
Capital received from investors		10,403,102,011
Net investment income not yet distributed		74,624,007
Net realized capital losses		(418,257,845	)
Net unrealized capital gains		4,908,452,044
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$14,967,920,217		598,561,893			$25.01

See financial notes 17

 Schwab S&P 500 Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated issuer		$130,282
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $182,583)		158,075,680
Interest		49,101
Securities on loan	+	524,438
Total investment income		158,779,501
Expenses
Investment adviser and administrator fees		4,046,665
Shareholder service fees		1,305,170
Transfer agent fees		257,517
Portfolio accounting fees		149,664
Shareholder reports		146,136
Custodian fees		118,569
Registration fees		59,279
Professional fees		49,784
Trustees’ fees		42,082
Index fee		36,045
Other expenses	+	141,693
Total expenses		6,352,604
Expense reduction by CSIM and its affiliates	−	282,607
Net expenses	−	6,069,997
Net investment income		152,709,504
Realized and Unrealized Gains (Losses)
Net realized gains on investments		9,483,270
Net realized gains on futures contracts	+	23,302,687
Net realized gains		32,785,957
Net unrealized gains on affiliated issuer		3,669,602
Net unrealized gains on unaffiliated investments		1,637,341,338
Net unrealized gains on futures contracts	+	17,411,950
Net unrealized gains	+	1,658,422,890
Net realized and unrealized gains		1,691,208,847
Increase in net assets resulting from operations		$1,843,918,351

18 See financial notes

 Schwab S&P 500 Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$152,709,504			$249,809,268
Net realized gains		32,785,957			34,935,609
Net unrealized gains	+	1,658,422,890			1,365,738,638
Increase in net assets from operations		1,843,918,351			1,650,483,515
Distributions to Shareholders
Distributions from net investment income		($278,278,089	)		($218,494,240	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			82,825,361		$1,927,805,853			94,452,205		$2,011,893,595
Shares reinvested			11,251,940		248,330,312			10,225,170		196,221,005
Shares redeemed	+		(63,057,757	)	(1,460,805,822	)		(87,533,037	)	(1,861,743,855	)
Net transactions in fund shares			31,019,544		$715,330,343			17,144,338		$346,370,745
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			567,542,349		$12,686,949,612			550,398,011		$10,908,589,592
Total increase	+		31,019,544		2,280,970,605			17,144,338		1,778,360,020
End of period			598,561,893		$14,967,920,217			567,542,349		$12,686,949,612
Net investment income not yet distributed					$74,624,007					$200,192,592

See financial notes 19

Schwab 1000 Index^® Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		40.23			37.44			35.79			31.00			28.69			45.81
Income (loss) from investment operations:
Net investment income (loss)		0.42	2		0.71	2		0.62	2		0.57	2		0.54	2		0.66	2
Net realized and unrealized gains (losses)		5.19			4.32			2.07			4.80			2.41			(17.13	)
Total from investment operations		5.61			5.03			2.69			5.37			2.95			(16.47	)
Less distributions:
Distributions from net investment income		(0.81	)		(0.72	)		(0.57	)		(0.58	)		(0.64	)		(0.62	)
Distributions from net realized gains		(1.66	)		(1.52	)		(0.47	)		—			—			(0.03	)
Total distributions		(2.47	)		(2.24	)		(1.04	)		(0.58	)		(0.64	)		(0.65	)
Net asset value at end of period		43.37			40.23			37.44			35.79			31.00			28.69
Total return (%)		14.78	3		14.38			7.60			17.51			10.72			(36.43	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.29	4		0.29			0.29			0.29			0.38	5		0.49
Gross operating expenses		0.34	4		0.34			0.34			0.35			0.44			0.49
Net investment income (loss)		2.06	4		1.85			1.64			1.71			1.96			1.68
Portfolio turnover rate		3	3		4			5			5			4			4
Net assets, end of period ($ x 1,000,000)		5,371			4,848			4,552			4,575			4,279			2,260

* Unaudited.

¹ Effective September 18, 2009, the Select Share class and the Investor Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Investor Shares.

² Calculated based on the average shares outstanding during the period.

³ Not annualized.

⁴ Annualized.

⁵ Effective May 5, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

20 See financial notes

 Schwab 1000 Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	99	.7%	Common Stock		1,945,901,212		5,352,014,793
	0	.2%	Other Investment Company		12,912,949		12,912,949
	0	.0%	Short-Term Investment		1,886,777		1,886,777
	99	.9%	Total Investments		1,960,700,938		5,366,814,519
	0	.5%	Collateral Invested for Securities on Loan		27,548,134		27,548,134
	(0	.4)%	Other Assets and Liabilities, Net				(23,486,940	)
	100	.0%	Net Assets				5,370,875,713

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 99.7% of net assets
Automobiles & Components 1.1%
Other Securities				1.1		56,408,208
Banks 2.8%
U.S. Bancorp		615,405		0.4		20,480,678
Wells Fargo & Co.		1,602,296		1.1		60,855,202
Other Securities				1.3		68,706,593
				2.8		150,042,473
Capital Goods 7.8%
3M Co.		207,654		0.4		21,743,450
General Electric Co.		3,432,102		1.4		76,501,554
The Boeing Co.		219,489		0.4		20,063,490
United Technologies Corp.		276,003		0.5		25,196,314
Other Securities				5.1		275,288,267
				7.8		418,793,075
Commercial & Professional Supplies 0.9%
Other Securities				0.9		46,315,863
Consumer Durables & Apparel 1.4%
Other Securities				1.4		75,461,361
Consumer Services 2.0%
McDonald’s Corp.		328,636		0.6		33,566,881
Other Securities				1.4		75,409,598
				2.0		108,976,479
Diversified Financials 6.3%
American Express Co.		318,677		0.4		21,800,694
Bank of America Corp.		3,527,541		0.8		43,424,030
Citigroup, Inc.		997,756		0.9		46,555,295
JPMorgan Chase & Co.		1,256,978		1.1		61,604,492
The Charles Schwab Corp. (a)		367,065		0.1		6,225,422
The Goldman Sachs Group, Inc.		144,232		0.4		21,067,968
Other Securities				2.6		134,967,137
				6.3		335,645,038
Energy 10.2%
Chevron Corp.		640,537		1.5		78,151,919
ConocoPhillips		397,266		0.4		24,014,730
Exxon Mobil Corp.		1,476,263		2.4		131,372,644
Occidental Petroleum Corp.		265,016		0.4		23,655,328
Schlumberger Ltd.		434,547		0.6		32,343,333
Other Securities				4.9		260,482,711
				10.2		550,020,665
Food & Staples Retailing 2.2%
CVS Caremark Corp.		408,011		0.4		23,738,080
Wal-Mart Stores, Inc.		547,427		0.8		42,546,027
Other Securities				1.0		50,206,777
				2.2		116,490,884
Food, Beverage & Tobacco 5.7%
Altria Group, Inc.		662,805		0.5		24,199,011
PepsiCo, Inc.		506,285		0.8		41,753,324
Philip Morris International, Inc.		542,565		1.0		51,863,788
The Coca-Cola Co.		1,262,448		1.0		53,439,424
Other Securities				2.4		133,132,632
				5.7		304,388,179
Health Care Equipment & Services 4.1%
Other Securities				4.1		222,315,594
Household & Personal Products 2.2%
The Procter & Gamble Co.		894,919		1.3		68,702,931
Other Securities				0.9		50,716,643
				2.2		119,419,574
Insurance 4.4%
Berkshire Hathaway, Inc., Class B *		597,012		1.2		63,474,316
Other Securities				3.2		171,329,710
				4.4		234,804,026
Materials 3.7%
Other Securities				3.7		196,790,467

See financial notes 21

 Schwab 1000 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Media 3.6%
Comcast Corp., Class A		869,723		0.7		35,919,560
News Corp., Class A		659,928		0.4		20,437,970
The Walt Disney Co.		586,960		0.7		36,884,566
Other Securities				1.8		100,164,484
				3.6		193,406,580
Pharmaceuticals, Biotechnology & Life Sciences 8.1%
AbbVie, Inc.		516,646		0.4		23,791,548
Amgen, Inc.		251,102		0.5		26,167,339
Bristol-Myers Squibb Co.		540,239		0.4		21,458,293
Gilead Sciences, Inc. *		491,644		0.5		24,896,852
Johnson & Johnson		914,287		1.5		77,924,681
Merck & Co., Inc.		995,018		0.9		46,765,846
Pfizer, Inc.		2,376,751		1.3		69,092,152
Other Securities				2.6		146,691,594
				8.1		436,788,305
Real Estate 3.3%
Other Securities				3.3		178,438,457
Retailing 4.3%
Amazon.com, Inc. *		118,641		0.6		30,112,272
The Home Depot, Inc.		489,335		0.7		35,892,722
Other Securities				3.0		162,613,430
				4.3		228,618,424
Semiconductors & Semiconductor Equipment 2.0%
Intel Corp.		1,628,580		0.7		39,004,491
Other Securities				1.3		70,058,755
				2.0		109,063,246
Software & Services 9.4%
Google, Inc., Class A *		87,112		1.3		71,829,942
International Business Machines Corp.		346,340		1.3		70,147,704
Microsoft Corp.		2,479,138		1.5		82,059,468
Oracle Corp.		1,225,210		0.7		40,162,384
Visa, Inc., Class A		170,600		0.5		28,739,276
Other Securities				4.1		212,347,967
				9.4		505,286,741
Technology Hardware & Equipment 5.8%
Apple, Inc.		307,880		2.5		136,313,870
Cisco Systems, Inc.		1,737,715		0.7		36,352,998
QUALCOMM, Inc.		564,178		0.6		34,764,648
Other Securities				2.0		102,974,248
				5.8	��	310,405,764
Telecommunication Services 2.8%
AT&T, Inc.		1,803,977		1.3		67,576,978
Verizon Communications, Inc.		934,057		0.9		50,355,013
Other Securities				0.6		33,731,723
				2.8		151,663,714
Transportation 1.9%
Union Pacific Corp.		153,962		0.4		22,780,218
United Parcel Service, Inc., Class B		234,035		0.4		20,089,564
Other Securities				1.1		60,311,796
				1.9		103,181,578
Utilities 3.7%
Other Securities				3.7		199,290,098
Total Common Stock
(Cost $1,945,901,212)						5,352,014,793
Other Investment Company 0.2% of net assets
Money Market Fund 0.2%
Other Securities				0.2		12,912,949
Total Other Investment Company
(Cost $12,912,949)						12,912,949
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investment 0.0% of net assets
U.S. Treasury Obligation 0.0%
Other Securities				0.0		1,886,777
Total Short-Term Investment
(Cost $1,886,777)						1,886,777
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.5% of net assets
State Street Institutional U.S. Government Money Market Fund		27,548,134		0.5		27,548,134
Total Collateral Invested for Securities on Loan
(Cost $27,548,134)						27,548,134
End of Collateral Invested for Securities on Loan.

At 04/30/13, tax basis cost of the fund’s investments was $1,938,996,311 and the unrealized appreciation and depreciation were $3,471,304,917 and ($43,486,709), respectively, with a net unrealized appreciation of $3,427,818,208.

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	All or a portion of this security is on loan.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

22 See financial notes

 Schwab 1000 Index Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		175		13,931,750		476,131

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$5,352,014,793		$—		$—		$5,352,014,793
Other Investment Company1		12,912,949		—		—		12,912,949
Short-Term Investment1		—		1,886,777		—		1,886,777
Total		$5,364,927,742		$1,886,777		$—		$5,366,814,519
Other Financial Instruments
Collateral Invested for Securities on Loan		$27,548,134		$—		$—		$27,548,134
Futures Contract2		476,131		—		—		476,131

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock		$64,997		$3,754		($4,047	)		$—		($64,704	)		$—		$—		$—
Total		$64,997		$3,754		($4,047	)		$—		($64,704	)		$—		$—		$—

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 23

 Schwab 1000 Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated issuers, at value (cost $1,803,228)		$6,225,422
Investments in unaffiliated issuers, at value (cost $1,958,897,710) including securities on loan of $29,184,865	+	5,360,589,097
Total investments, at value (cost $1,960,700,938)		5,366,814,519
Collateral invested for securities on loan		27,548,134
Receivables:
Investments sold		9,513
Dividends		4,683,935
Fund shares sold		2,511,546
Income from securities on loan		65,208
Due from broker for futures		35,000
Foreign tax reclaims		8,273
Interest		200
Prepaid expenses	+	79,629
Total assets		5,401,755,957
Liabilities
Collateral held for securities on loan		27,548,134
Payables:
Investment adviser and administrator fees		79,881
Shareholder service fees		46,824
Fund shares redeemed		3,041,835
Accrued expenses	+	163,570
Total liabilities		30,880,244
Net Assets
Total assets		5,401,755,957
Total liabilities	−	30,880,244
Net assets		$5,370,875,713
Net Assets by Source
Capital received from investors		1,835,394,954
Net investment income not yet distributed		24,282,174
Net realized capital gains		102,604,607
Net unrealized capital gains		3,408,593,978
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$5,370,875,713		123,848,216			$43.37

24 See financial notes

 Schwab 1000 Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated issuer		$44,048
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $64,905)		58,322,420
Interest		2,641
Securities on loan	+	449,311
Total investment income		58,818,420
Expenses
Investment adviser and administrator fees		5,685,549
Shareholder service fees		2,432,961
Shareholder reports		84,195
Portfolio accounting fees		72,833
Transfer agent fees		60,125
Custodian fees		50,723
Professional fees		32,251
Trustees’ fees		23,305
Registration fees		21,096
Interest expense		676
Other expenses	+	56,544
Total expenses		8,520,258
Expense reduction by CSIM and its affiliates	−	1,271,867
Custody credits	−	27
Net expenses	−	7,248,364
Net investment income		51,570,056
Realized and Unrealized Gains (Losses)
Net realized gains on investments		78,490,688
Net realized gains on futures contracts	+	747,715
Net realized gains		79,238,403
Net unrealized gains on affiliated issuer		1,240,679
Net unrealized gains on unaffiliated investments		564,958,366
Net unrealized gains on futures contracts	+	1,141,421
Net unrealized gains	+	567,340,466
Net realized and unrealized gains		646,578,869
Increase in net assets resulting from operations		$698,148,925

See financial notes 25

 Schwab 1000 Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$51,570,056			$87,953,893
Net realized gains		79,238,403			196,881,889
Net unrealized gains	+	567,340,466			349,793,722
Increase in net assets from operations		698,148,925			634,629,504
Distributions to Shareholders
Distributions from net investment income		(96,597,152	)		(86,671,033	)
Distributions from net realized gains	+	(197,828,775	)		(183,283,175	)
Total distributions		($294,425,927	)		($269,954,208	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			5,165,461		$208,551,948			6,643,918		$254,453,021
Shares reinvested			6,695,843		255,781,218			6,777,525		235,112,352
Shares redeemed	+		(8,505,566	)	(345,178,048	)		(14,504,214	)	(557,797,536	)
Net transactions in fund shares			3,355,738		$119,155,118			(1,082,771	)	($68,232,163	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			120,492,478		$4,847,997,597			121,575,249		$4,551,554,464
Total increase or decrease	+		3,355,738		522,878,116			(1,082,771	)	296,443,133
End of period			123,848,216		$5,370,875,713			120,492,478		$4,847,997,597
Net investment income not yet distributed					$24,282,174					$69,309,270

26 See financial notes

Schwab Small-Cap Index Fund^®

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		21.26			20.55			19.18			15.14			13.85			25.35
Income (loss) from investment operations:
Net investment income (loss)		0.27	2		0.33	2		0.25	2		0.22	2		0.18	2		0.33	2
Net realized and unrealized gains (losses)		3.10			1.89			1.37			3.97			1.40			(7.89	)
Total from investment operations		3.37			2.22			1.62			4.19			1.58			(7.56	)
Less distributions:
Distributions from net investment income		(0.50	)		(0.35	)		(0.20	)		(0.15	)		(0.29	)		(0.32	)
Distributions from net realized gains		(0.50	)		(1.16	)		(0.05	)		—			—			(3.62	)
Total distributions		(1.00	)		(1.51	)		(0.25	)		(0.15	)		(0.29	)		(3.94	)
Net asset value at end of period		23.63			21.26			20.55			19.18			15.14			13.85
Total return (%)		16.55	3		11.87			8.45			27.85			11.98			(34.48	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.17	4		0.17			0.19			0.19			0.28	5		0.42
Gross operating expenses		0.21	4		0.21			0.19			0.20			0.33			0.42
Net investment income (loss)		2.43	4		1.63			1.18			1.23			1.41			1.78
Portfolio turnover rate		2	3		41	6		26			33			26			64
Net assets, end of period ($ x 1,000,000)		1,968			1,675			1,502			1,406			1,142			628

* Unaudited.

¹ Effective August 21, 2009, the Investor Share class and the Select Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Calculated based on the average shares outstanding during the period.

³ Not annualized.

⁴ Annualized.

⁵ Effective May 5, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁶ Portfolio turnover rate increase was mainly the result of trading activities in connection with the change in primary benchmark index effective December 14, 2011.

See financial notes 27

 Schwab Small-Cap Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.7%	Common Stock		1,425,295,460		1,923,145,535
	0	.0%	Rights		—		—
	0	.0%	Warrants		—		2,758
	2	.5%	Short-Term Investments		48,008,019		48,008,019
	100	.2%	Total Investments		1,473,303,479		1,971,156,312
	4	.5%	Collateral Invested for Securities on Loan		89,167,306		89,167,306
	(4	.7)%	Other Assets and Liabilities, Net				(92,666,074	)
	100	.0%	Net Assets				1,967,657,544

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 97.7% of net assets
Automobiles & Components 0.9%
Other Securities				0.9		17,762,736
Banks 7.9%
Firstmerit Corp.		240,515		0.2		4,120,022
Ocwen Financial Corp. *		153,800		0.3		5,626,004
Other Securities				7.4		145,774,594
				7.9		155,520,620
Capital Goods 8.6%
A.O. Smith Corp.		56,395		0.2		4,253,875
Acuity Brands, Inc.		60,900		0.2		4,443,264
Hexcel Corp. *		144,183		0.2		4,397,581
Middleby Corp. *		26,752		0.2		4,001,564
Teledyne Technologies, Inc. *		53,300		0.2		4,000,698
Other Securities				7.6		147,433,164
				8.6		168,530,146
Commercial & Professional Supplies 3.2%
Other Securities				3.2		64,062,815
Consumer Durables & Apparel 3.0%
Brunswick Corp.		127,800		0.2		4,046,148
Other Securities				2.8		55,959,392
				3.0		60,005,540
Consumer Services 4.3%
Domino’s Pizza, Inc.		83,979		0.2		4,635,641
Six Flags Entertainment Corp.		52,100		0.2		3,796,527
Other Securities				3.9		75,403,488
				4.3		83,835,656
Diversified Financials 3.5%
Other Securities				3.5		68,461,442
Energy 5.7%
Dril-Quip, Inc. *		57,900		0.2		4,846,809
Gulfport Energy Corp. *		109,000		0.3		5,688,710
Lufkin Industries, Inc.		48,390		0.2		4,272,353
Oasis Petroleum, Inc. *		114,300		0.2		3,912,489
Other Securities				4.8		94,500,716
				5.7		113,221,077
Food & Staples Retailing 1.1%
Other Securities				1.1		21,923,117
Food, Beverage & Tobacco 1.9%
Other Securities				1.9		37,786,982
Health Care Equipment & Services 6.1%
athenahealth, Inc. *		51,700		0.3		4,976,642
HealthSouth Corp. *		139,000		0.2		3,822,500
Other Securities				5.6		112,160,115
				6.1		120,959,257
Household & Personal Products 0.6%
Other Securities				0.6		10,986,228
Insurance 2.5%
Alterra Capital Holdings Ltd.		124,300		0.2		4,045,965
First American Financial Corp.		154,000		0.2		4,122,580
Other Securities				2.1		40,459,788
				2.5		48,628,333
Materials 4.9%
Axiall Corp.		99,400		0.3		5,213,530
Eagle Materials, Inc.		70,190		0.2		4,755,372
Other Securities				4.4		87,425,166
				4.9		97,394,068
Media 1.4%
Other Securities				1.4		27,152,033
Pharmaceuticals, Biotechnology & Life Sciences 6.0%
Alkermes plc *		177,542		0.3		5,434,561
Cubist Pharmaceuticals, Inc. *		91,832		0.2		4,216,925

28 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Pharmacyclics, Inc. *		82,200		0.3		6,699,300
Seattle Genetics, Inc. *		137,798		0.3		5,091,636
Other Securities				4.9		96,510,543
				6.0		117,952,965
Real Estate 9.4%
Healthcare Realty Trust, Inc.		126,681		0.2		3,802,964
Highwoods Properties, Inc.		113,600		0.2		4,661,008
Invesco Mortgage Capital, Inc.		193,200		0.2		4,134,480
Omega Healthcare Investors, Inc.		160,300		0.3		5,269,061
RLJ Lodging Trust		175,500		0.2		4,043,520
Starwood Property Trust, Inc.		238,200		0.3		6,548,118
The Geo Group, Inc.		103,180		0.2		3,864,091
Two Harbors Investment Corp.		512,200		0.3		6,136,156
Other Securities				7.5		146,560,311
				9.4		185,019,709
Retailing 4.3%
Cabela’s, Inc. *		67,836		0.2		4,355,071
Other Securities				4.1		79,541,489
				4.3		83,896,560
Semiconductors & Semiconductor Equipment 3.4%
Cymer, Inc. *		44,365		0.2		4,647,678
First Solar, Inc. *		86,300		0.2		4,018,128
Other Securities				3.0		58,204,696
				3.4		66,870,502
Software & Services 7.7%
Aspen Technology, Inc. *		135,400		0.2		4,126,992
CommVault Systems, Inc. *		64,200		0.2		4,721,268
CoStar Group, Inc. *		40,375		0.2		4,377,054
MAXIMUS, Inc.		49,348		0.2		3,932,542
PTC, Inc. *		173,200		0.2		4,158,532
Ultimate Software Group, Inc. *		41,000		0.2		3,960,190
WEX, Inc. *		55,976		0.2		4,241,861
Other Securities				6.3		121,454,622
				7.7		150,973,061
Technology Hardware & Equipment 4.7%
3D Systems Corp. (c)*		111,300		0.2		4,256,112
Other Securities				4.5		88,200,141
				4.7		92,456,253
Telecommunication Services 0.7%
Other Securities				0.7		13,033,246
Transportation 2.5%
Alaska Air Group, Inc. *		101,700		0.3		6,268,788
Avis Budget Group, Inc. *		151,900		0.2		4,380,796
Genesee & Wyoming, Inc., Class A *		63,700		0.3		5,427,240
Old Dominion Freight Line, Inc. *		103,424		0.2		3,981,824
US Airways Group, Inc. (c)*		233,600		0.2		3,947,840
Other Securities				1.3		26,331,902
				2.5		50,338,390
Utilities 3.4%
Cleco Corp.		88,300		0.2		4,372,616
Other Securities				3.2		62,002,183
				3.4		66,374,799
Total Common Stock
(Cost $1,425,295,460)						1,923,145,535
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Other Securities				0.0		—
Total Rights
(Cost $—)						—
Warrants 0.0% of net assets
Energy 0.0%
Other Securities				0.0		2,758
Total Warrants
(Cost $—)						2,758
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 2.5% of net assets
Time Deposit 2.3%
DNB
0.03%, 05/01/13		45,606,267		2.3		45,606,267
U.S. Treasury Obligations 0.2%
Other Securities				0.2		2,401,752
Total Short-Term Investments
(Cost $48,008,019)						48,008,019
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 4.5% of net assets
Wells Fargo Advantage Government Money Market Fund		89,167,306		4.5		89,167,306
Total Collateral Invested for Securities on Loan
(Cost $89,167,306)						89,167,306
End of Collateral Invested for Securities on Loan.

At 04/30/13 tax basis cost of the fund’s investments was $1,479,083,260 and the unrealized appreciation and

See financial notes 29

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

depreciation were $611,940,951 and ($119,867,899), respectively, with a net unrealized appreciation of $492,073,052.

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(b)	Illiquid security. At the period end, the value of these amounted to $2,758 or 0.0% of net assets.
(c)	All or a portion of this security is on loan.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
Russell 2000 Index, mini, Long, expires 06/21/13		450		42,529,500		651,224

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$1,923,145,535		$—		$—		$1,923,145,535
Rights1		—		—		—		—
Warrants1		2,758		—		—		2,758
Short-Term Investments1		—		48,008,019		—		48,008,019
Total		$1,923,148,293		$48,008,019		$—		$1,971,156,312
Other Financial Instruments
Collateral Invested for Securities on Loan		$89,167,306		$—		$—		$89,167,306
Futures Contract2		651,224		—		—		651,224

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock		$319,479		$—		($202,848	)		$—		($116,631	)		$—		$—		$—
Total		$319,479		$—		($202,848	)		$—		($116,631	)		$—		$—		$—

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

30 See financial notes

 Schwab Small-Cap Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $1,473,303,479) including securities on loan of $87,283,125		$1,971,156,312
Collateral invested for securities on loan		89,167,306
Receivables:
Investments sold		713,676
Fund shares sold		3,164,436
Dividends		738,979
Income from securities on loan		389,448
Due from broker for futures		271,598
Interest		38
Prepaid expenses	+	22,897
Total assets		2,065,624,690
Liabilities
Collateral held for securities on loan		89,167,306
Payables:
Investments bought		7,645,357
Investment adviser and administrator fees		19,138
Shareholder service fees		3,632
Fund shares redeemed		900,434
Accrued expenses	+	231,279
Total liabilities		97,967,146
Net Assets
Total assets		2,065,624,690
Total liabilities	−	97,967,146
Net assets		$1,967,657,544
Net Assets by Source
Capital received from investors		1,445,086,242
Net investment income not yet distributed		4,607,674
Net realized capital gains		16,574,377
Net unrealized capital gains		501,389,251
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$1,967,657,544		83,260,768			$23.63

See financial notes 31

 Schwab Small-Cap Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $18,188)		$21,121,204
Interest		7,865
Securities on loan	+	2,260,372
Total investment income		23,389,441
Expenses
Investment adviser and administrator fees		1,350,752
Shareholder service fees		176,498
Index fee		99,741
Portfolio accounting fees		46,233
Shareholder reports		40,378
Transfer agent fees		35,300
Professional fees		30,531
Custodian fees		29,023
Registration fees		22,457
Trustees’ fees		8,044
Other expenses	+	19,235
Total expenses		1,858,192
Expense reduction by CSIM and its affiliates	−	327,340
Net expenses	−	1,530,852
Net investment income		21,858,589
Realized and Unrealized Gains (Losses)
Net realized gains on investments		14,513,909
Net realized gains on futures contracts		6,163,739
Net realized losses on foreign currency transactions	+	(196	)
Net realized gains		20,677,452
Net unrealized gains on investments		233,291,347
Net unrealized gains on futures contracts		2,001,346
Net unrealized gains on foreign currency translations	+	23
Net unrealized gains	+	235,292,716
Net realized and unrealized gains		255,970,168
Increase in net assets resulting from operations		$277,828,757

32 See financial notes

 Schwab Small-Cap Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$21,858,589			$25,899,729
Net realized gains		20,677,452			42,756,059
Net unrealized gains	+	235,292,716			105,693,799
Increase in net assets from operations		277,828,757			174,349,587
Distributions to Shareholders
Distributions from net investment income		(39,112,389	)		(25,652,389	)
Distributions from net realized gains	+	(39,238,431	)		(84,544,390	)
Total distributions		($78,350,820	)		($110,196,779	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			8,874,007		$197,010,561			13,103,409		$271,438,282
Shares reinvested			3,540,194		72,432,373			5,456,861		101,552,188
Shares redeemed	+		(7,924,813	)	(176,004,829	)		(12,880,545	)	(264,077,786	)
Net transactions in fund shares			4,489,388		$93,438,105			5,679,725		$108,912,684
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			78,771,380		$1,674,741,502			73,091,655		$1,501,676,010
Total increase	+		4,489,388		292,916,042			5,679,725		173,065,492
End of period			83,260,768		$1,967,657,544			78,771,380		$1,674,741,502
Net investment income not yet distributed					$4,607,674					$21,861,474

See financial notes 33

Schwab Total Stock Market Index Fund^®

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		25.80			22.92			21.57			18.50			17.08			27.04
Income (loss) from investment operations:
Net investment income (loss)		0.30			0.47			0.41			0.37			0.24			0.40
Net realized and unrealized gains (losses)		3.51			2.83			1.33			3.02			1.55			(9.93	)
Total from investment operations		3.81			3.30			1.74			3.39			1.79			(9.53	)
Less distributions:
Distributions from net investment income		(0.54	)		(0.42	)		(0.39	)		(0.32	)		(0.37	)		(0.37	)
Distributions from net realized gains		—			—			—			—			—			(0.06	)
Total distributions		(0.54	)		(0.42	)		(0.39	)		(0.32	)		(0.37	)		(0.43	)
Net asset value at end of period		29.07			25.80			22.92			21.57			18.50			17.08
Total return (%)		15.07	2		14.71			8.14			18.53			10.92			(35.76	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.09	3		0.09			0.09			0.09			0.21	4		0.38
Gross operating expenses		0.10	3		0.10			0.11			0.11			0.28			0.38
Net investment income (loss)		2.25	3		2.02			1.79			1.85			2.02			1.71
Portfolio turnover rate		1	2		3			1			3			5			1
Net assets, end of period ($ x 1,000,000)		2,703			2,240			1,747			1,470			1,205			585

* Unaudited.

¹ Effective September 18, 2009, the Investor Share class and the Select Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Not annualized.

³ Annualized.

⁴ Effective May 5, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

34 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	98	.0%	Common Stock		1,813,770,978		2,648,285,384
	0	.0%	Rights		—		—
	0	.0%	Warrants		—		4
	1	.8%	Short-Term Investments		49,546,906		49,546,906
	99	.8%	Total Investments		1,863,317,884		2,697,832,294
	0	.7%	Collateral Invested for Securities on Loan		19,140,972		19,140,972
	(0	.5)%	Other Assets and Liabilities, Net				(14,184,574	)
	100	.0%	Net Assets				2,702,788,692

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 98.0% of net assets
Automobiles & Components 1.0%
Other Securities				1.0		26,748,280
Banks 3.2%
U.S. Bancorp		280,531		0.3		9,336,072
Wells Fargo & Co.		740,406		1.0		28,120,620
Other Securities				1.9		49,249,647
				3.2		86,706,339
Capital Goods 7.7%
3M Co.		96,000		0.4		10,052,160
General Electric Co.		1,567,266		1.3		34,934,359
The Boeing Co.		102,600		0.3		9,378,666
United Technologies Corp.		127,068		0.4		11,600,038
Other Securities				5.3		141,055,157
				7.7		207,020,380
Commercial & Professional Supplies 1.1%
Other Securities				1.1		28,739,521
Consumer Durables & Apparel 1.5%
Other Securities				1.5		41,657,098
Consumer Services 2.2%
McDonald’s Corp.		151,109		0.6		15,434,273
Other Securities				1.6		43,192,404
				2.2		58,626,677
Diversified Financials 5.8%
American Express Co.		145,250		0.4		9,936,552
Bank of America Corp.		1,623,056		0.7		19,979,819
Citigroup, Inc.		458,028		0.8		21,371,586
JPMorgan Chase & Co.		576,844		1.0		28,271,124
The Charles Schwab Corp. (b)		163,626		0.1		2,775,097
The Goldman Sachs Group, Inc.		65,900		0.4		9,626,013
Other Securities				2.4		64,799,078
				5.8		156,759,269
Energy 9.6%
Chevron Corp.		292,839		1.3		35,729,286
ConocoPhillips		184,923		0.4		11,178,595
Exxon Mobil Corp.		675,334		2.2		60,097,973
Occidental Petroleum Corp.		120,920		0.4		10,793,319
Schlumberger Ltd.		200,160		0.6		14,897,909
Other Securities				4.7		127,350,663
				9.6		260,047,745
Food & Staples Retailing 2.0%
CVS Caremark Corp.		185,990		0.4		10,820,898
Wal-Mart Stores, Inc.		252,100		0.7		19,593,212
Other Securities				0.9		24,957,898
				2.0		55,372,008
Food, Beverage & Tobacco 5.3%
Altria Group, Inc.		302,100		0.4		11,029,671
PepsiCo, Inc.		232,558		0.7		19,179,058
Philip Morris International, Inc.		248,400		0.9		23,744,556
The Coca-Cola Co.		577,900		0.9		24,462,507
Other Securities				2.4		64,786,485
				5.3		143,202,277
Health Care Equipment & Services 4.3%
Other Securities				4.3		115,156,356
Household & Personal Products 2.1%
The Procter & Gamble Co.		411,715		1.2		31,607,361
Other Securities				0.9		24,282,746
				2.1		55,890,107
Insurance 4.2%
Berkshire Hathaway, Inc., Class B *		274,874		1.1		29,224,604
Other Securities				3.1		83,186,548
				4.2		112,411,152

See financial notes 35

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Materials 3.7%
Other Securities				3.7		100,084,126
Media 3.4%
Comcast Corp., Class A		398,904		0.6		16,474,735
News Corp., Class A		300,850		0.3		9,317,324
The Walt Disney Co.		272,093		0.6		17,098,324
Other Securities				1.9		49,408,255
				3.4		92,298,638
Pharmaceuticals, Biotechnology & Life Sciences 7.8%
AbbVie, Inc.		238,205		0.4		10,969,340
Amgen, Inc.		112,768		0.4		11,751,553
Bristol-Myers Squibb Co.		246,250		0.4		9,781,050
Gilead Sciences, Inc. *		229,980		0.4		11,646,187
Johnson & Johnson		421,270		1.3		35,904,842
Merck & Co., Inc.		455,570		0.8		21,411,790
Pfizer, Inc.		1,083,501		1.2		31,497,374
Other Securities				2.9		78,585,200
				7.8		211,547,336
Real Estate 3.9%
Other Securities				3.9		106,915,186
Retailing 4.2%
Amazon.com, Inc. *		54,800		0.5		13,908,788
The Home Depot, Inc.		225,370		0.6		16,530,889
Other Securities				3.1		83,382,812
				4.2		113,822,489
Semiconductors & Semiconductor Equipment 2.1%
Intel Corp.		746,932		0.7		17,889,021
Other Securities				1.4		37,948,075
				2.1		55,837,096
Software & Services 9.1%
Google, Inc., Class A *		40,265		1.2		33,201,311
International Business Machines Corp.		157,910		1.2		31,983,091
Microsoft Corp.		1,136,250		1.4		37,609,875
Oracle Corp.		556,549		0.7		18,243,676
Visa, Inc., Class A		77,800		0.5		13,106,188
Other Securities				4.1		111,280,711
				9.1		245,424,852
Technology Hardware & Equipment 5.7%
Apple, Inc.		141,600		2.3		62,693,400
Cisco Systems, Inc.		803,609		0.6		16,811,500
QUALCOMM, Inc.		259,000		0.6		15,959,580
Other Securities				2.2		58,857,666
				5.7		154,322,146
Telecommunication Services 2.6%
AT&T, Inc.		827,756		1.1		31,007,740
Verizon Communications, Inc.		430,772		0.9		23,222,919
Other Securities				0.6		16,985,786
				2.6		71,216,445
Transportation 1.9%
Union Pacific Corp.		70,900		0.4		10,490,364
Other Securities				1.5		40,456,031
				1.9		50,946,395
Utilities 3.6%
Other Securities				3.6		97,533,466
Total Common Stock
(Cost $1,813,770,978)						2,648,285,384
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Other Securities				0.0		—
Total Rights
(Cost $—)						—
Warrants 0.0% of net assets
Energy 0.0%
Other Securities				0.0		4
Total Warrants
(Cost $—)						4
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 1.8% of net assets
Time Deposit 1.7%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		46,397,197		1.7		46,397,197
U.S. Treasury Obligation 0.1%
Other Securities				0.1		3,149,709
Total Short-Term Investments
(Cost $49,546,906)						49,546,906
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.7% of net assets
Wells Fargo Advantage Government Money Market Fund		19,140,972		0.7		19,140,972
Total Collateral Invested for Securities on Loan
(Cost $19,140,972)						19,140,972
End of Collateral Invested for Securities on Loan.

36 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

At 04/30/13 tax basis cost of the fund’s investments was $1,877,499,703 and the unrealized appreciation and depreciation were $931,961,728 and ($111,629,137), respectively, with a net unrealized appreciation of $820,332,591.

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(b)	Issuer is affiliated with the fund’s adviser.
(c)	Illiquid security. At the period end, the value of these amounted to $4 or 0.0% of net assets.
(d)	All or a portion of this security is on loan.
(e)	All or a portion of this security is held as collateral for open futures contracts.
(f)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/21/13		65		6,143,150		89,586
S&P 500 Index, e-mini, Long, expires 06/21/13		550		43,785,500		1,393,351
Net unrealized gains						1,482,937

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$2,648,285,384		$—		$—		$2,648,285,384
Rights1		—		—		—		—
Warrants1		4		—		—		4
Short-Term Investments1		—		49,546,906		—		49,546,906
Total		$2,648,285,388		$49,546,906		$—		$2,697,832,294
Other Financial Instruments
Collateral Invested for Securities on Loan		$19,140,972		$—		$—		$19,140,972
Futures Contracts2		1,482,937		—		—		1,482,937

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock		$86,391		$966		($30,585	)		$—		($56,772	)		$—		$—		$—
Total		$86,391		$966		($30,585	)		$—		($56,772	)		$—		$—		$—

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 37

 Schwab Total Stock Market Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated issuers, at value (cost $3,006,243)		$2,775,097
Investments in unaffiliated issuers, at value (cost $1,860,311,641) including securities on loan of $18,739,170	+	2,695,057,197
Total investments, at value (cost $1,863,317,884)		2,697,832,294
Collateral invested for securities on loan		19,140,972
Receivables:
Investments sold		46,329
Fund shares sold		4,384,550
Dividends		2,189,509
Due from broker for futures		141,673
Income from securities on loan		70,561
Foreign tax reclaims		3,631
Interest		39
Prepaid expenses	+	24,491
Total assets		2,723,834,049
Liabilities
Collateral held for securities on loan		19,140,972
Payables:
Investments bought		348,569
Investment adviser and administrator fees		11,999
Shareholder service fees		5,181
Fund shares redeemed		1,488,931
Accrued expenses	+	49,705
Total liabilities		21,045,357
Net Assets
Total assets		2,723,834,049
Total liabilities	−	21,045,357
Net assets		$2,702,788,692
Net Assets by Source
Capital received from investors		1,866,685,791
Net investment income not yet distributed		12,565,559
Net realized capital losses		(13,532,495	)
Net unrealized capital gains		837,069,837
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$2,702,788,692		92,974,812			$29.07

38 See financial notes

 Schwab Total Stock Market Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated issuer		$19,071
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $26,922)		27,970,886
Interest		8,773
Securities on loan	+	390,450
Total investment income		28,389,180
Expenses
Investment adviser and administrator fees		728,783
Shareholder service fees		234,376
Portfolio accounting fees		54,190
Transfer agent fees		50,814
Shareholder reports		38,009
Custodian fees		35,076
Registration fees		30,577
Professional fees		25,698
Trustees’ fees		9,839
Other expenses	+	23,783
Total expenses		1,231,145
Expense reduction by CSIM and its affiliates	−	137,970
Net expenses	−	1,093,175
Net investment income		27,296,005
Realized and Unrealized Gains (Losses)
Net realized gains on investments		1,997,509
Net realized gains on futures contracts	+	4,803,155
Net realized gains		6,800,664
Net unrealized gains on affiliated issuer		533,148
Net unrealized gains on unaffiliated investments		310,996,020
Net unrealized gains on futures contracts	+	1,984,918
Net unrealized gains	+	313,514,086
Net realized and unrealized gains		320,314,750
Increase in net assets resulting from operations		$347,610,755

See financial notes 39

 Schwab Total Stock Market Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$27,296,005			$39,674,206
Net realized gains		6,800,664			12,059,250
Net unrealized gains	+	313,514,086			211,001,775
Increase in net assets from operations		347,610,755			262,735,231
Distributions to Shareholders
Distributions from net investment income		($47,503,974	)		($32,188,219	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			14,524,045		$390,473,479			21,918,622		$541,100,465
Shares reinvested			1,519,219		38,800,859			1,240,438		27,500,498
Shares redeemed	+		(9,889,510	)	(266,270,555	)		(12,563,348	)	(306,292,186	)
Net transactions in fund shares			6,153,754		$163,003,783			10,595,712		$262,308,777
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			86,821,058		$2,239,678,128			76,225,346		$1,746,822,339
Total increase	+		6,153,754		463,110,564			10,595,712		492,855,789
End of period			92,974,812		$2,702,788,692			86,821,058		$2,239,678,128
Net investment income not yet distributed					$12,565,559					$32,773,528

40 See financial notes

Schwab International Index Fund^®

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		16.32			16.02			17.31			16.26			13.95			25.95
Income (loss) from investment operations:
Net investment income (loss)		0.27			0.57			0.57			0.48			0.37			0.68
Net realized and unrealized gains (losses)		2.38			0.33			(1.38	)		1.01			2.58			(12.13	)
Total from investment operations		2.65			0.90			(0.81	)		1.49			2.95			(11.45	)
Less distributions:
Distributions from net investment income		(0.58	)		(0.60	)		(0.48	)		(0.44	)		(0.64	)		(0.55	)
Net asset value at end of period		18.39			16.32			16.02			17.31			16.26			13.95
Total return (%)		16.69	2		6.07			(4.83	)		9.31			22.55			(45.02	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.19	3		0.19			0.19			0.19			0.32	4		0.50
Gross operating expenses		0.23	3		0.23			0.21			0.22			0.41			0.54
Net investment income (loss)		3.13	3		3.66			3.26			2.88			2.92			3.15
Portfolio turnover rate		5	2		31	5		10			13			21			10
Net assets, end of period ($ x 1,000,000)		1,777			1,415			1,375			1,471			1,369			711

* Unaudited.

¹ Effective August 21, 2009, the Investor Share class and the Select Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Not annualized.

³ Annualized.

⁴ Effective May 5, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁵ Portfolio turnover rate increase was mainly the result of trading activities in connection with the change in primary benchmark index effective December 20, 2011.

See financial notes 41

 Schwab International Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	95	.9%	Common Stock		1,271,956,797		1,703,066,687
	0	.5%	Preferred Stock		6,648,095		9,647,033
	0	.0%	Rights		749,437		189,972
	0	.5%	Other Investment Company		8,089,400		8,671,600
	2	.6%	Short-Term Investments		45,804,555		45,804,555
	99	.5%	Total Investments		1,333,248,284		1,767,379,847
	0	.7%	Collateral Invested for Securities on Loan		13,249,645		13,249,645
	(0	.2)%	Other Assets and Liabilities, Net				(4,092,671	)
	100	.0%	Net Assets				1,776,536,821

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 95.9% of net assets
Australia 8.9%
Australia & New Zealand Banking Group Ltd.		389,130		0.7		12,859,665
BHP Billiton Ltd.		459,710		0.9		15,454,974
Commonwealth Bank of Australia		230,333		1.0		17,556,180
National Australia Bank Ltd.		332,374		0.7		11,728,776
Westpac Banking Corp.		441,047		0.9		15,471,941
Other Securities				4.7		84,443,277
				8.9		157,514,813
Austria 0.3%
Other Securities				0.3		4,647,649
Belgium 1.1%
Anheuser-Busch InBev N.V.		114,981		0.6		11,046,285
Other Securities				0.5		8,731,979
				1.1		19,778,264
Denmark 1.1%
Novo Nordisk A/S, Class B		58,294		0.6		10,261,183
Other Securities				0.5		9,222,851
				1.1		19,484,034
Finland 0.7%
Other Securities				0.7		12,998,424
France 9.0%
BNP Paribas S.A.		143,573		0.5		8,005,328
Sanofi		170,501		1.0		18,433,806
Total S.A.		304,784		0.9		15,341,927
Other Securities				6.6		117,601,016
				9.0		159,382,077
Germany 7.4%
Allianz SE - Reg’d		65,263		0.5		9,653,737
BASF SE		131,468		0.7		12,307,057
Bayer AG - Reg’d		118,366		0.7		12,374,744
Daimler AG - Reg’d		129,861		0.4		7,200,149
SAP AG		131,865		0.6		10,512,533
Siemens AG - Reg’d		119,798		0.7		12,517,335
Other Securities				3.8		67,355,665
				7.4		131,921,220
Greece 0.1%
Other Securities				0.1		1,315,759
Hong Kong 3.0%
AIA Group Ltd.		1,724,000		0.4		7,669,139
Other Securities				2.6		45,055,423
				3.0		52,724,562
Ireland 0.2%
Other Securities				0.2		4,541,154
Israel 0.5%
Other Securities				0.5		8,471,530
Italy 2.0%
Eni S.p.A.		364,129		0.5		8,690,452
Other Securities				1.5		26,831,923
				2.0		35,522,375
Japan 21.3%
Honda Motor Co., Ltd.		233,339		0.5		9,310,801
Mitsubishi UFJ Financial Group, Inc.		1,823,909		0.7		12,374,930
Mizuho Financial Group, Inc.		3,271,434		0.4		7,198,649
Sumitomo Mitsui Financial Group, Inc.		192,246		0.5		9,086,954
Toyota Motor Corp.		394,803		1.3		22,913,505
Other Securities				17.9		317,652,667
				21.3		378,537,506
Netherlands 2.3%
Unilever N.V. CVA		233,168		0.6		9,935,601

42 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Other Securities				1.7		30,537,122
				2.3		40,472,723
New Zealand 0.1%
Other Securities				0.1		2,238,130
Norway 0.8%
Other Securities				0.8		14,916,754
Portugal 0.2%
Other Securities				0.2		3,115,366
Singapore 1.7%
Other Securities				1.7		30,136,757
Spain 2.8%
Banco Bilbao Vizcaya Argentaria S.A.		779,929		0.4		7,592,270
Banco Santander S.A.		1,508,470		0.6		10,893,486
Telefonica S.A.		586,276		0.5		8,584,433
Other Securities				1.3		22,010,699
				2.8		49,080,888
Sweden 3.0%
Other Securities				3.0		53,957,470
Switzerland 8.7%
ABB Ltd. - Reg’d *		314,758		0.4		7,137,737
Nestle S.A. - Reg’d		461,587		1.9		32,916,896
Novartis AG - Reg’d		329,252		1.4		24,373,726
Roche Holding AG		100,562		1.4		25,174,730
UBS AG - Reg’d		521,220		0.5		9,297,737
Other Securities				3.1		55,293,525
				8.7		154,194,351
United Kingdom 20.7%
AstraZeneca plc		178,232		0.5		9,253,980
Barclays plc		1,664,521		0.4		7,427,885
BG Group plc		486,896		0.5		8,219,455
BHP Billiton plc		302,315		0.5		8,504,961
BP plc		2,728,786		1.1		19,773,167
British American Tobacco plc		276,577		0.9		15,332,106
Diageo plc		358,643		0.6		10,952,084
GlaxoSmithKline plc		702,732		1.0		18,131,519
HSBC Holdings plc		2,634,543		1.6		28,853,482
Rio Tinto plc		191,890		0.5		8,811,604
Royal Dutch Shell plc, A Shares		535,064		1.0		18,216,400
Royal Dutch Shell plc, B Shares		375,025		0.7		13,154,913
SABMiller plc		137,054		0.4		7,395,056
Standard Chartered plc		345,103		0.5		8,685,345
Unilever plc		183,710		0.4		7,959,548
Vodafone Group plc		7,039,947		1.2		21,480,953
Other Securities				8.9		155,962,423
				20.7		368,114,881
Total Common Stock
(Cost $1,271,956,797)						1,703,066,687
Preferred Stock 0.5% of net assets
Germany 0.5%
Other Securities				0.5		9,647,033
Total Preferred Stock
(Cost $6,648,095)						9,647,033
Rights 0.0% of net assets
Netherlands 0.0%
Other Securities				0.0		183,125
Spain 0.0%
Other Securities				0.0		6,847
Total Rights
(Cost $749,437)						189,972
Other Investment Company 0.5% of net assets
United States 0.5%
iShares MSCI EAFE Index Fund		140,000		0.5		8,671,600
Total Other Investment Company
(Cost $8,089,400)						8,671,600
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 2.6% of net assets
Time Deposits 2.4%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		42,259,898		2.4		42,259,898
Other Securities				0.1		1,024,933
				2.4		43,284,831
U.S. Treasury Obligation 0.2%
Other Securities				0.2		2,519,724
Total Short-Term Investments
(Cost $45,804,555)						45,804,555
End of Investments.

See financial notes 43

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.7% of net assets
Wells Fargo Advantage Government Money Market Fund		13,249,645		0.7		13,249,645
Total Collateral Invested for Securities on Loan
(Cost $13,249,645)						13,249,645
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $1,341,846,484 and the unrealized appreciation and depreciation were $552,055,617 and ($126,522,254), respectively, with a net unrealized appreciation of $425,533,363.

At 04/30/13, the values of certain foreign securities held by the fund aggregating $1,701,405,029 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

CDI —	CHESS Depositary Interest
CVA —	Dutch Certificate
Reg’d —	Registered
REIT —	Real Estate Investment Trust
RSP —	Risparmio (Convertible Savings Shares)
SDR —	Swedish Depositary Receipt

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI EAFE, e-mini, Long, expires 06/21/13		495		43,084,800		1,721,083

44 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$521,507,486		$—		$521,507,486
Australia		490,550		157,024,263		—		157,514,813
Denmark		897,760		18,586,274		—		19,484,034
France		5,301,156		154,080,921		—		159,382,077
Greece		1,015,400		300,359		—		1,315,759
Ireland		1,253,267		3,287,887		—		4,541,154
Japan		262,471		378,275,035		—		378,537,506
Netherlands		1,268,487		39,204,236		—		40,472,723
Portugal		747,974		2,367,392		—		3,115,366
Spain		22,088		49,058,800		—		49,080,888
United Kingdom		—		368,065,343		49,538		368,114,881
Preferred Stock1		—		9,647,033		—		9,647,033
Rights1		189,972		—		—		189,972
Other Investment Company1		8,671,600		—		—		8,671,600
Short-Term Investments1		—		45,804,555		—		45,804,555
Total		$20,120,725		$1,747,209,584		$49,538		$1,767,379,847
Other Financial Instruments
Collateral Invested for Securities on Loan		$13,249,645		$—		$—		$13,249,645
Futures Contract2		1,721,083		—		—		1,721,083

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock
United Kingdom		$—		$—		$929			$48,609		$—			$—		$—		$49,538
Preferred Stock
United Kingdom		30,829		282		(361	)		—		(30,750	)		—		—		—
Total		$30,829		$282		$568			$48,609		($30,750	)		$—		$—		$49,538

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The change in net unrealized gains (losses) for Level 3 investments held by the fund at April 30, 2013 was $930.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were security transfers in the amount of $2,269,842 and $3,182,487 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, for the period ended April 30, 2013. The transfers between Level 1 and Level 2 were primarily due to the use of international fair valuation by the fund. There were no transfers in or out of Level 3 securities during the period.

See financial notes 45

 Schwab International Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $1,333,248,284) including securities on loan of $12,565,705		$1,767,379,847
Foreign currency, at value (cost $202)		202
Collateral invested for securities on loan		13,249,645
Receivables:
Dividends		7,384,393
Fund shares sold		2,825,308
Foreign tax reclaims		1,440,159
Income from securities on loan		157,860
Due from broker for futures		39,600
Interest		36
Prepaid expenses	+	22,532
Total assets		1,792,499,582
Liabilities
Collateral held for securities on loan		13,249,645
Payables:
Investments bought		402,373
Investment adviser and administrator fees		18,596
Shareholder service fees		3,041
Fund shares redeemed		2,110,999
Accrued expenses	+	178,107
Total liabilities		15,962,761
Net Assets
Total assets		1,792,499,582
Total liabilities	−	15,962,761
Net assets		$1,776,536,821
Net Assets by Source
Capital received from investors		1,363,370,421
Net investment income not yet distributed		9,426,289
Net realized capital losses		(32,101,202	)
Net unrealized capital gains		435,841,313
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$1,776,536,821		96,608,278			$18.39

46 See financial notes

 Schwab International Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $1,706,775)		$25,515,408
Interest		6,435
Securities on loan	+	291,374
Total investment income		25,813,217
Expenses
Investment adviser and administrator fees		1,167,903
Shareholder service fees		152,606
Custodian fees		142,373
Index fee		98,340
Portfolio accounting fees		51,226
Transfer agent fees		38,318
Shareholder reports		37,476
Professional fees		30,909
Registration fees		17,986
Trustees’ fees		7,236
Interest expense		154
Other expenses	+	24,732
Total expenses		1,769,259
Expense reduction by CSIM and its affiliates	−	289,762
Net expenses	−	1,479,497
Net investment income		24,333,720
Realized and Unrealized Gains (Losses)
Net realized gains on investments		1,969,861
Net realized gains on futures contracts		1,758,230
Net realized losses on foreign currency transactions	+	(171,019	)
Net realized gains		3,557,072
Net unrealized gains on investments		214,252,903
Net unrealized gains on futures contracts		1,721,083
Net unrealized gains on foreign currency translations	+	69,077
Net unrealized gains	+	216,043,063
Net realized and unrealized gains		219,600,135
Increase in net assets resulting from operations		$243,933,855

See financial notes 47

 Schwab International Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$24,333,720			$49,562,359
Net realized gains		3,557,072			54,688,994
Net unrealized gains (losses)	+	216,043,063			(22,069,338	)
Increase in net assets from operations		243,933,855			82,182,015
Distributions to Shareholders
Distributions from net investment income		($50,551,708	)		($51,830,156	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			16,013,455		$274,091,059			14,938,008		$230,299,984
Shares reinvested			2,784,477		45,581,882			3,211,483		47,080,346
Shares redeemed	+		(8,868,544	)	(151,491,725	)		(17,316,607	)	(267,897,568	)
Net transactions in fund shares			9,929,388		$168,181,216			832,884		$9,482,762
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			86,678,890		$1,414,973,458			85,846,006		$1,375,138,837
Total increase	+		9,929,388		361,563,363			832,884		39,834,621
End of period			96,608,278		$1,776,536,821			86,678,890		$1,414,973,458
Net investment income not yet distributed					$9,426,289					$35,644,277

48 See financial notes

 Schwab Equity Index Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds discussed in this report is a series of Schwab Capital Trust, except Schwab 1000 Index Fund, which is a series of Schwab Investments. Both Schwab Capital Trust and Schwab Investments (the “trusts”) are no-load, open-end management investment companies. Each trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trusts as of the end of the period, including the funds discussed in this report, which are highlighted:

Schwab Capital Trust (organized May 7, 1993)	Schwab Target 2035 Fund
Schwab S&P 500 Index Fund	Schwab Target 2040 Fund
Schwab Small-Cap Index Fund	Schwab Target 2045 Fund
Schwab Total Stock Market Index Fund	Schwab Target 2050 Fund
Schwab International Index Fund	Schwab Target 2055 Fund
Schwab MarketTrack All Equity Portfolio	Schwab Fundamental US Large Company Index Fund
Schwab MarketTrack Growth Portfolio	Schwab Fundamental US Small Company Index Fund
Schwab MarketTrack Balanced Portfolio	Schwab Fundamental International Large Company Index Fund
Schwab MarketTrack Conservative Portfolio	Schwab Fundamental International Small Company Index Fund
Laudus Small-Cap MarketMasters Fund	Schwab Fundamental Emerging Markets Large Company Index Fund
Laudus International MarketMasters Fund	Schwab Monthly Income Fund – Moderate Payout
Schwab Balanced Fund	Schwab Monthly Income Fund – Enhanced Payout
Schwab Core Equity Fund	Schwab Monthly Income Fund – Maximum Payout
Schwab Dividend Equity Fund
Schwab Large-Cap Growth Fund	Schwab Investments (organized October 26, 1990)
Schwab Small-Cap Equity Fund	Schwab 1000 Index Fund
Schwab Hedged Equity Fund	Schwab Short-Term Bond Market Fund
Schwab Financial Services Fund	Schwab Intermediate-Term Bond Fund
Schwab Health Care Fund	(formerly Schwab Premier Income Fund)
Schwab International Core Equity Fund	Schwab Total Bond Market Fund
Schwab Target 2010 Fund	Schwab GNMA Fund
Schwab Target 2015 Fund	Schwab Treasury Inflation Protected Securities Index Fund
Schwab Target 2020 Fund	Schwab Tax-Free Bond Fund
Schwab Target 2025 Fund	Schwab California Tax-Free Bond Fund
Schwab Target 2030 Fund	Schwab Global Real Estate Fund

Each fund in this report offers one share class. Shares are bought and sold (subject to a redemption fee, see financial note 9) at closing net asset value per share (“NAV”), which is the price for all outstanding shares of the funds. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the “Board”) may authorize the issuance of as many shares as necessary.

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 may also keep certain assets in segregated accounts, as required by securities law.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

(a) Security Valuation:

Under procedures approved by the Board, the investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

The funds value the securities in their portfolios every business day. The funds use the following policies to value various types of securities:

•  Securities traded on an exchange or over-the-counter: Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at halfway between the most recent bid and ask quotes. Securities that are primarily traded on foreign exchanges are valued at the official closing price or the last sales price on the exchange where

49

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

the securities are principally traded with these values then translated into U.S. dollars at the current exchange rate, unless these securities are fair valued as discussed below.

•  Securities for which no quoted value is available: The Board has adopted procedures to fair value each fund’s securities when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Each fund makes fair value determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ techniques such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing Committee regularly reviews these inputs and assumptions to calibrate the valuations. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security. The Board convenes on a regular basis to review fair value determinations made by the funds pursuant to the valuation procedures.

•  Foreign equity security fair valuation: The Board has adopted procedures to fair value foreign equity securities that are traded in markets that close prior to the funds valuing their holdings. By fair valuing securities whose prices may have been affected by events occurring after the close of trading, each fund seeks to establish prices that investors might expect to realize upon the current sales of these securities. This methodology is designed to deter “arbitrage” market timers, who seek to exploit delays between the change in the value of a fund’s portfolio holdings and the net asset value of the fund’s shares, and seeks to help ensure that the prices at which the fund’s shares are purchased and redeemed are fair and do not result in dilution of shareholder interest or other harm to shareholders. When fair value pricing is used at the open or close of a reporting period, it may cause a temporary divergence between the return of a fund and that of its comparative index or benchmark. The Board regularly reviews fair value determinations made by the funds pursuant to these procedures.

•  Futures and forward foreign currency exchange contracts: Futures and forwards are valued at their settlement prices as of the close of their exchanges (for futures) or at a value based on that day’s forward exchange rates (for forwards).

•  Short-term securities (60 days or less to maturity): Short-term securities are valued at amortized cost, which approximates market value.

•  Underlying funds: Mutual funds are valued at their respective net asset values. Exchange trade funds (ETFs) traded on a recognized securities exchange are valued at the last reported sale price that day or the official closing price, if applicable.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If the funds determine that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

•  Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities and futures contracts. Investments in mutual funds are valued daily at their NAVs, which are classified as Level 1 prices.

•  Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most

50 

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. In addition, international securities whose markets close hours before the funds value their holdings may require fair valuations due to significant movement in the U.S. markets occurring after the daily close of the foreign markets. The Board has approved a vendor that calculates fair valuations of international equity securities based on a number of factors that appear to correlate to the movements in the U.S. markets. As investments whose values are classified as Level 2 prices include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

•  Level 3 — significant unobservable inputs (including the funds’ own assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not available for these securities, the funds use one or more valuation techniques for which sufficient and reliable data is available. The inputs used by the funds in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the funds in the absence of market information. Assumptions used by the funds due to the lack of observable inputs may significantly impact the resulting fair value and therefore the funds’ results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the funds’ investments as of April 30, 2013 are disclosed in the Portfolio Holdings.

(b) Accounting Policies for certain Portfolio Investments (if held):

Futures Contracts: Futures contracts are instruments that represent an agreement between two parties that obligates one party to buy, and the other party to sell, specific instruments at an agreed upon price on a stipulated future date. A fund must give the broker a deposit of cash and/or securities (initial margin) whenever it enters into the futures contract. The amount of the deposit may vary from one contract to another. Subsequent payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized gains or losses until the contract is closed, at which time the gains or losses are realized. Futures are traded publicly on exchanges, and their market value changes daily.

Forward Foreign Currency Exchange Contracts: “Forwards”, as they are known, are contracts to buy and sell a currency at a set price on a future date. The value of the forwards is accounted for as unrealized gains or losses until the contracts settle, at which time the gains or losses are realized.

Securities Lending: Under the trusts’ Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to have a value of at least 102% of the prior day’s market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities and is marked to market daily. The cash collateral of securities loaned is invested in money market portfolios operating under Rule 2a-7 of the 1940 Act. Securities lending income, as disclosed in a fund’s Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent which are subject to adjustments pursuant to the securities lending agreement.

If applicable, the value of the securities on loan as of April 30, 2013 and the value of the related collateral are disclosed in the Statement of Assets and Liabilities and the complete Portfolio Holdings.

(c) Security Transactions:

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains or losses from security transactions are based on the identified costs of the securities involved.

51

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

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 calculated using exchange rates in effect on the transaction date. Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the differences between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains or losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period. These realized and unrealized foreign exchange gains or losses are reported in foreign currency transactions or translations in the Statement of Operations. The funds do not isolate the portion of the fluctuations on investments resulting from changes in foreign currency exchange rates from the fluctuations in market prices of investments held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.

Gains realized by the funds on the sale of securities in certain foreign countries may be subject to non-U.S. taxes. In those instances, the funds record a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.

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 of the contract, and records a realized gain or loss accordingly.

(d) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds 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 received from foreign sources may result in withholding tax. Withholding taxes are accrued at the same time as the related income if the tax rate is fixed and known, unless a tax withheld is reclaimable from the local tax authorities in which case it is recorded as receivable. If the tax rate is not known or estimable, such expense or reclaim receivable is recorded when the net proceeds are received.

(e) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within the trust generally are allocated among the funds in proportion to their average daily net assets.

(f) Distributions to Shareholders:

The funds make distributions from net investment income and net realized capital gains, if any, once a year.

(g) Custody Credit:

Certain funds have an arrangement with their custodian bank, under which the funds may receive a credit for their uninvested cash balance to offset their custody fees and accounting fees. The credit amounts, if any, are disclosed in the Statement of Operations as a reduction to the funds’ operating expenses.

(h) Accounting Estimates:

The accounting policies described in this report conform to GAAP. 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 and these differences may be material.

(i) Federal Income Taxes:

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.

52 

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(j) Foreign Taxes:

The funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, corporate events, foreign currency exchanges and capital gains on investments. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in foreign markets in which the funds invest. These foreign taxes, if any, are paid by the funds and are disclosed in the Statement of Operations. Foreign taxes payable as of April 30, 2013, if any, are reflected in the funds’ Statements of Assets and Liabilities.

(k) Indemnification:

Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.

(l) New Accounting Pronouncements:

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative instruments. Management is currently evaluating the impact the adoption of ASU No. 2011-11 may have on the funds’ financial statement disclosures.

3. Risk Factors:

Investing in the funds may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Stock markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of the investment in a fund will fluctuate, which means that investors could lose money.

The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

As an index fund, each fund seeks to track the performance of its comparative index, although it may not be successful in doing so. The divergence between the performance of a fund and its index, positive or negative, is called “tracking error”. Tracking error can be caused by many factors and it may be significant. For example, a fund may not invest in certain securities in the index, or match the securities’ weightings to the index, due to regulatory, operational, custodial or liquidity constraints; corporate transactions; asset valuations; transaction costs and timing; tax considerations; and index rebalancing, which may result in tracking error.

Each fund invests in companies measured by its respective index. It follows these stocks during upturns as well as downturns. Because of its indexing strategy, a fund does not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of a fund’s expenses, the fund’s performance may be below that of the index.

If a fund uses a sampling method, the fund will not fully replicate its comparative index and may hold securities not included in the index. As a result, the fund is subject to the risk that the investment adviser’s investment management strategy, the implementation of which is subject to a number of constraints, may not produce the intended results. If a fund utilizes a sampling approach, it may not track the return of the index as well as it would if the fund purchased all of the securities in its benchmark index.

To the extent that a fund’s or the index’s portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector, or asset class, the fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more susceptible to adverse economic, market, political or regulatory occurrences affecting that market, industry, group of industries, sector, or asset class.

53

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Historically, small-cap stocks have been riskier than large- and mid-cap stocks. Stock prices of smaller companies may be based in substantial part on future expectations rather than current achievements and may move sharply, especially during market upturns and downturns. Small-cap companies themselves may be more vulnerable to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall behind other types of investments — bonds or large-cap stocks, for instance — a fund’s small-cap holdings could reduce performance.

Both large- and mid-cap stocks tend to go in and out of favor based on market and economic conditions. However, stocks of mid-cap companies tend to be more volatile than those of large-cap companies because mid-cap companies tend to be more susceptible to adverse business or economic events than larger more established companies. During a period when large- and mid-cap U.S. stocks fall behind other types of investments — bonds, for instance — a fund’s large- and mid-cap holdings could reduce performance.

A fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs.

To the extent a fund’s investments in a single country or a limited number of countries represent a higher percentage of the fund’s assets, the fund assumes the risk that economic, political and social conditions in those countries will have a significant impact on its investment performance and it may be subject to increased price volatility.

A fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Certain of these risks, such as liquidity risk and market risk, are discussed elsewhere in this section. A fund’s use of derivatives is also subject to credit risk, leverage risk, lack of availability risk, valuation risk, correlation risk and tax risk. Lack of availability risk is the risk that suitable derivative transactions may not be available in all circumstances for risk management or other purposes. Credit risk is the risk that the counterparty to a derivatives transaction may not fulfill its obligations. Leverage risk is the risk that a small percentage of assets invested in derivatives can have a disproportionately larger impact on a fund. Valuation risk is the risk that a particular derivative may be valued incorrectly. Correlation risk is the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate or index. Tax risk is the risk that the use of derivatives may cause the fund to realize higher amounts of short-term capital gain. These risks could cause a fund to lose more than the principal amount invested.

A particular investment may be difficult to purchase or sell. A fund may be unable to sell illiquid securities at an advantageous time or price.

Securities lending involves the risk of loss of rights in the collateral or delay in recovery of the collateral if the borrower fails to return the security loaned or becomes insolvent.

Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.

4. Affiliates and Affiliated Transactions:

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement (“Advisory Agreement”) between CSIM and each trust.

For its advisory and administrative services to the Schwab 1000 Index Fund, CSIM is entitled to receive an annual fee, payable monthly, based on a percentage of the fund’s average daily net assets as follows:

	Schwab
	1000
% of Average Daily Net Assets	Index Fund
First $500 million		0.30%
$500 million to $5 billion		0.22%
$5 billion to $10 billion		0.20%
Over $10 billion		0.18%

54 

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

For its advisory and administrative services to the following funds, CSIM is entitled to receive an annual fee, payable monthly, based on a percentage of each fund’s average daily net assets as follows:

				Schwab
Schwab		Schwab		Total Stock		Schwab
S&P 500		Small-Cap		Market		International
Index Fund		Index Fund		Index Fund		Index Fund
	0.06%		0.15%		0.06%		0.15%

The Board has adopted a Shareholder Servicing Plan (the “Plan”) on behalf of the funds. The Plan enables each fund to bear expenses relating to the provision by service providers, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, “Schwab”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds. Schwab serves as the funds’ paying agent under the Plan for making payments of the shareholder service fee due to the service providers (other than Schwab). All shareholder service fees paid by the funds to Schwab in its capacity as the funds’ paying agent will be passed through to the service providers, and Schwab will not retain any portion of such fees.

Pursuant to the Plan, each fund’s shares are subject to an annual shareholder servicing fee up to the amount set forth in the table below. The shareholder servicing fee paid to a particular service provider is made pursuant to its written agreement with Schwab (or, in the case of payments made to Schwab, pursuant to Schwab’s written agreement with the funds). Payments under the Plan are made as described above regardless of Schwab’s or the service provider’s actual cost of providing the services. If the cost of providing the services under the Plan is less than the payments received, the unexpended portion of the fees may be retained as profit by Schwab or the service provider.

						Schwab
Schwab		Schwab		Schwab		Total Stock		Schwab
S&P 500		1000		Small-Cap		Market		International
Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
	0.02%		0.10%		0.02%		0.02%		0.02%

Although these agreements specify certain fees for these services, CSIM and its affiliates have made an additional agreement with the funds, for so long as CSIM serves as the investment adviser to the funds, which may only be amended or terminated with the approval of the Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses (“expense limitation”). The expense limitation as a percentage of average daily net assets is as follows:

						Schwab
Schwab		Schwab		Schwab		Total Stock		Schwab
S&P 500		1000		Small-Cap		Market		International
Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
	0.09%		0.29%		0.17%		0.09%		0.19%

The funds may engage in certain transactions involving affiliates. For instance, a fund may own shares of The Charles Schwab Corporation if that company is included in its index. Below is the summary of investment activities involving The Charles Schwab Corporation shares owned by the Schwab Equity Index Funds during the report period:

	Balance						Balance				Realized		Dividends
	of Shares						of Shares		Market		Gains (Losses)		Received
	Held at		Gross		Gross		Held at		Value at		11/01/12		11/01/12
Fund	10/31/12		Additions		Sales		04/30/13		04/30/13		to 04/30/13		to 04/30/13
Schwab S&P 500 Index Fund		1,085,681		—		—		1,085,681		$18,413,150		$—		$130,282
Schwab 1000 Index Fund		367,065		—		—		367,065		6,225,422		—		44,048
Schwab Total Stock Market Index Fund		154,226		9,400		—		163,626		2,775,097		—		19,071

55

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Certain Schwab Funds may own shares of other Schwab Funds. The table below reflects the percentages of each fund shares in this report owned by other Schwab Funds as of April 30, 2013:

								Schwab
	Schwab			Schwab		Schwab		Total Stock		Schwab
	S&P 500			1000		Small-Cap		Market		International
	Index Fund			Index Fund		Index Fund		Index Fund		Index Fund
Schwab MarketTrack All Equity Portfolio		1.6%			—%		6.6%		—%		9.1%
Schwab MarketTrack Growth Portfolio		1.7%			—%		6.3%		—%		7.1%
Schwab MarketTrack Balanced Portfolio		0.9%			—%		3.5%		—%		3.9%
Schwab MarketTrack Conservative Portfolio		0.3%			—%		1.0%		—%		1.2%
Schwab MarketTrack Growth Portfolio II		0.1%			0.1%		0.3%		—%		0.3%
Schwab Target 2010 Fund		0.0%	*		—%		—%		—%		—%
Schwab Target 2015 Fund		0.0%	*		—%		—%		—%		—%
Schwab Target 2020 Fund		0.2%			—%		—%		—%		—%
Schwab Target 2025 Fund		0.1%			—%		—%		—%		—%
Schwab Target 2030 Fund		0.4%			—%		—%		—%		—%
Schwab Target 2035 Fund		0.1%			—%		—%		—%		—%
Schwab Target 2040 Fund		0.4%			—%		—%		—%		—%
Schwab Target 2045 Fund		0.0%	*		—%		—%		—%		—%
Schwab Target 2050 Fund		0.0%	*		—%		—%		—%		—%
Schwab Target 2045 Fund		0.0%	*		—%		—%		—%		—%

* Less than 0.05%

Certain other related parties may own shares of Schwab funds in this report. As of April 30, 2013, the shares owned by Schwab Charitable Giving Trust (an affiliate of Schwab) as a percentage of the total shares of the Schwab Small Cap Index Fund and the Schwab Total Stock Market Fund were 2.6% and 6.2%, respectively.

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other Schwab Funds. All loans are for temporary or emergency purposes only. The interest rate to be charged on a loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.

5. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted in each fund’s Statement of Operations. For information regarding the trustees please refer to Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The funds have access to custodian overdraft facilities, a committed line of credit of $150 million with State Street Bank and Trust Company (“State Street”), an uncommitted line of credit of $100 million with Bank of America, N.A. and an uncommitted line of credit of $50 million with Brown Brothers Harriman & Co. The funds pay interest on the amounts they borrow at rates that are negotiated periodically. The funds also pay an annual fee to State Street for the committed line of credit.

There were no borrowings from the lines of credit by the funds during the period. However, the funds may have utilized their overdraft facility and incurred interest expense, which is disclosed in the Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

56 

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

7. Derivatives:

Certain funds entered into equity index futures contracts (“futures”) during the report period. The funds invested in futures to equitize available cash. The fair value and due to brokers for futures contracts held at April 30, 2013 are presented on the face of the Portfolio Holdings and Statement of Assets, respectively. The net realized/unrealized gains (losses) on futures contracts are presented on the Statement of Operations. Refer to financial note 2(b) for the funds’ accounting policies with respect to futures contracts and financial note 3 for disclosures concerning the risks of investing in futures contracts. During the period, the month-end average contract values of futures contracts held by the funds and the month-end average number of contracts held were as follows:

	Contract Values		Number of Contracts
Schwab S&P 500 Index Fund		$307,200,292		4,058
Schwab 1000 Index Fund		17,757,204		233
Schwab Small-Cap Index Fund		45,497,967		513
Schwab Total Stock Market Index Fund		51,655,358		675
Schwab International Index Fund		40,645,050		486

8. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2013, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Schwab S&P 500 Index Fund		$444,882,106		$43,114,568
Schwab 1000 Index Fund		127,235,884		239,420,270
Schwab Small-Cap Index Fund		98,677,329		39,975,208
Schwab Total Stock Market Index Fund		145,407,106		17,342,591
Schwab International Index Fund		175,337,681		79,190,397

9. Redemption Fee:

The funds charge a 2.00% redemption fee on shares sold or exchanged within 30 days of the original purchase date. Such amounts are netted against redemption proceeds in the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

	Current Period		Prior Period
	(11/1/12-4/30/13)		(11/1/11-10/31/12)
Schwab S&P 500 Index Fund		$111,137		$148,766
Schwab 1000 Index Fund		24,658		18,501
Schwab Small-Cap Index Fund		11,886		13,063
Schwab Total Stock Market Index Fund		21,933		149,791
Schwab International Index Fund		6,812		11,378

57

 Schwab Equity Index Funds

Financial Notes, unaudited (continued)

10. Federal Income Taxes:

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of October 31, 2012, the funds had capital loss carryforwards available to offset future net capital gains before the expiration dates as follows:

							Schwab
	Schwab		Schwab		Schwab		Total Stock		Schwab
	S&P 500		1000		Small-Cap		Market		International
Expiration Date	Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
October 31, 2013		$118,657,105		$—		$—		$—		$—
October 31, 2014		109,256,533		—		—		—		—
October 31, 2015		89,645,092		—		—		—		—
October 31, 2016		77,879,594		—		—		2,244,763		—
October 31, 2017		20,049,252		—		—		4,871,496		26,290,338
Total		$415,487,576		$—		$—		$7,116,259		$26,290,338

For the year ended October 31, 2012, the funds had capital losses utilized as follows:

							Schwab
	Schwab		Schwab		Schwab		Total Stock		Schwab
	S&P 500		1000		Small-Cap		Market		International
	Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
Capital losses utilized		$20,828,436		$—		$—		$12,375,982		$50,888,806

As of October 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended October 31, 2012, the funds did not incur any interest or penalties.

11. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

58 

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Capital Trust and Schwab Investments, which includes the funds covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The Fund Complex includes 94 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the funds’ Statement of Additional Information, which is available free by calling 1-800-435-4000.

 Independent Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Mariann Byerwalter 1960 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2000.)	Chairman of JDN Corporate Advisory LLC (advisory services firm) (Oct. 2001 – present).	77	Director,WageWorks, Inc. (2010 – present) Director, Redwood Trust, Inc. (1998 – present) Director, PMI Group Inc. (2001 – 2009)
John F. Cogan 1947 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2008.)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research; Professor of Public Policy, Stanford University (Sept. 2000 – present).	77	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
William A. Hasler 1941 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2000.)	Dean Emeritus, Haas School of Business, University of California, Berkeley (July 1998 – present).	77	Director, TOUSA (1998 – present) Director, Globalstar, Inc. (2009 – present) Director, Aviat Networks (2001 – present) Director, Mission West Properties (1998 – 2012) Director, Ditech Networks Corporation (1997 – 2012) Director, Genitope Corporation (2000 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2011.)	Private Investor.	77	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Tercica Inc. (2004 – 2008)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2011.)	Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – present); Senior Vice President and General Manager of Consumer Group, Intuit, Inc. (June 2007 – Dec. 2008); Senior Vice President and Chief Financial Officer, Intuit, Inc. (Sept. 2005 – Jan. 2008).	77	Director, KLA-Tencor Corporation (2008 – present) Director, BEA Systems, Inc. (2007 – 2008)

59

 Independent Trustees (continued)

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Gerald B. Smith 1950 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2000.)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (1990 – present).	77	Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – present) Director, Oneok, Inc (2009 – present) Lead Independent Director, Board of Cooper Industries (2002 – 2012)
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (Jan. 2008- present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	77	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

 Interested Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served )	During the Past Five Years	the Trustee	Other Directorships
Charles R. Schwab2 1937 Chairman and Trustee (Chairman and Trustee of Schwab Capital Trust since 1993 and Schwab Investments since 1991.)	Chairman and Director, The Charles Schwab Corporation, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc., Charles Schwab Bank, N. A.; Chairman and Chief Executive Officer, Schwab (SIS) Holdings Inc. I, Schwab International Holdings, Inc.; Chief Executive Officer, Schwab Holdings, Inc.; Through June 2007, Director, U.S. Trust Company, N. A., U.S. Trust Corporation, United States Trust Company of New York. Until October 2008, Chief Executive Officer, The Charles Schwab Corporation, Charles Schwab & Co., Inc.	77	None
Walter W. Bettinger II2 1960 Trustee (Trustee of Schwab Capital Trust and Schwab Investments since 2008.)	As of October 2008, President and Chief Executive Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. Since October 2008, Director, The Charles Schwab Corporation. Since May 2008, Director, Charles Schwab & Co., Inc. and Schwab Holdings, Inc. Since 2006, Director, Charles Schwab Bank. Until October 2008, President and Chief Operating Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. From 2004 through 2007, Executive Vice President and President, Schwab Investor Services. From 2004 through 2005, Executive Vice President and Chief Operating Officer, Individual Investor Enterprise, and from 2002 through 2004, Executive Vice President, Corporate Services.	94	None

60 

 Officers of the Trust

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
Marie Chandoha 1961 President and Chief Executive Officer (Officer of Schwab Capital Trust and Schwab Investments since 2010.)	Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President and Chief Executive Officer (Dec. 2010 – present) and Chief Investment Officer (Dec. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 2007 – August 2010).
George Pereira 1964 Treasurer and Principal Financial Officer (Officer of Schwab Capital Trust and Schwab Investments since 2004.)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab Asset Management (Ireland) Limited (April 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of Schwab Capital Trust and Schwab Investments since 2011.)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of Schwab Capital Trust and Schwab Investments since 2011.)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 2011 – present); Senior Managing Director, Global Head of Active Fixed-Income Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head of Market-Based Strategies, State Street Research (August 2003 – Jan. 2005).
David Lekich 1964 Secretary and Chief Legal Officer (Officer of Schwab Capital Trust and Schwab Investments since 2011.)	Senior Vice President (Sept. 2011 – present), Vice President (March 2004 – Sept. 2011), Charles Schwab & Co., Inc.; Senior Vice President and Chief Counsel (Sept. 2011 – present), Vice President (Jan. 2011 – Sept. 2011), Charles Schwab Investment Management, Inc.; Secretary (April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President (Officer of Schwab Capital Trust and Schwab Investments since 2005.)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant Secretary, Schwab ETFs (Oct. 2009 – present).

1	Trustees remain in office until they resign, retire or are removed by shareholder vote. The Schwab Funds® retirement policy requires that independent trustees elected after January 1, 2000 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the Schwab Funds retirement policy also requires any independent trustee of the Schwab Funds who also serves as an independent trustee of the Laudus Funds to retire from the Boards of the Schwab Funds upon their required retirement date from either the Boards of Trustees of the Schwab Funds or the Laudus Funds, whichever comes first.
2	Mr. Schwab and Mr. Bettinger are Interested Trustees because they are employees of Schwab. In addition to their employment with Schwab, Messrs. Schwab and Bettinger also own stock of The Charles Schwab Corporation, the parent company of Schwab and the investment adviser.
3	The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

61

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.

Barclays U.S. Aggregate Bond Index A broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-back securities (agency fixed-rate and hybrid ARM passthroughs), asset-backed securities, and commercial mortgage-backed securities.

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.”

An individual bond is subject to the credit risk of the issuer. Changes in interest rates can affect a bond’s market value prior to call or maturity. There is no guarantee that a bond’s yield to call or maturity will provide a positive return over the rate of inflation.

bond fund A bond fund is subject to the same credit, interest rate, and inflation risks as bonds. In addition, a bond fund incurs ongoing fees and expenses. A bond fund’s net asset value will fluctuate with the price of the underlying bonds and the portfolio turnover activity; return of principal is not guaranteed.

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.

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.

MSCI EAFE Index A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada. The Net version of the index reflects reinvested dividends net of withholding taxes, but reflects no deductions for expenses or other taxes; returns are calculated applying dividend withholding rates applicable to non-resident persons who do not benefit from double taxation treaties.

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.

Russell 2000 Index An index that measures the performance of the small-cap segment of the U.S. equity universe.

S&P 500 Index A market capitalization index that is designed to measure the performance of 500 leading publicly held companies in leading industries of the U.S. economy.

stock A share of ownership, or equity, in the issuing company.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

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.

62 

Notes

Notes

Schwab Funds^® offers you an extensive family of mutual funds, each one based on a clearly defined investment approach and using disciplined management strategies. The list at right shows all currently available Schwab Funds.

Whether you are an experienced investor or just starting out, Schwab Funds can help you achieve your financial goals. An investor should consider a fund’s investment objectives, risks, charges and expenses carefully before investing or sending money. This and other important information can be found in the fund’s prospectus. Please call 1-800-435-4000 for a prospectus and brochure for any Schwab Fund. Please read the prospectus carefully before you invest. This report must be preceded or accompanied by a current prospectus.

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting Schwab’s website at www.schwabfunds.com/prospectus, the SEC’s website at http://www.sec.gov, or by contacting Schwab Funds at 1-800-435-4000.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.schwabfunds.com/prospectus or the SEC’s website at http://www.sec.gov.

The Schwab Funds Family^®

Stock Funds

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core Equity Fund

Schwab Fundamental US Large Company Index Fund

Schwab Fundamental US Small Company Index Fund

Schwab Fundamental International Large Company Index Fund

Schwab Fundamental International Small Company Index Fund

Schwab Fundamental Emerging Markets Large Company Index Fund

Schwab Global Real Estate Fund^tm

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market Index Fund^®

Schwab International Index Fund^®

Asset Allocation Funds

Schwab Balanced Fund^tm

Schwab MarketTrack All Equity Portfolio^tm

Schwab MarketTrack Growth Portfolio^tm

Schwab MarketTrack Balanced Portfolio^tm

Schwab MarketTrack Conservative Portfolio^tm

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

Schwab^® Monthly Income Fund – Moderate Payout

Schwab^® Monthly Income Fund – Enhanced Payout

Schwab^® Monthly Income Fund – Maximum Payout

Bond Funds

Schwab Short-Term Bond Market Fund^tm

Schwab Intermediate-Term Bond Fund^tm

Schwab Total Bond Market Fund^tm

Schwab GNMA Fund^tm

Schwab^® Treasury Inflation Protected Securities Index Fund

Schwab Tax-Free Bond Fund^tm

Schwab California Tax-Free Bond Fund^tm

Schwab Money Funds

Schwab offers an array of money market funds¹. Choose from taxable or tax-advantaged alternatives. Many can be linked to your eligible Schwab account to “sweep” cash balances automatically, subject to availability, when you’re between investments. Or, for your larger cash reserves, choose one of our Value Advantage Investments^®.

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.

Investment Adviser

Charles Schwab Investment Management, Inc.

211 Main Street, San Francisco, CA 94105

Funds

Schwab Funds^®

P.O. Box 3812, Englewood, CO 80155–3812

This report is not authorized for distribution to prospective investors

unless preceded or accompanied by a current prospectus.

^© 2013 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR13562-17

00098630

Semiannual report dated April 30, 2013, enclosed.

Schwab Active Equity Funds

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core

Equity Fund

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This wrapper is not part of the shareholder report.

Schwab Active Equity Funds

Semiannual Report

April 30, 2013

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core

Equity Fund

Schwab Active Equity Funds

In This Report

Performance at a Glance	3
From the President	4
Fund Management	6
Performance and Fund Facts
Schwab Core Equity Fund™	7
Schwab Dividend Equity Fund™	8
Schwab Large-Cap Growth Fund™	9
Schwab Small-Cap Equity Fund™	10
Schwab Hedged Equity Fund™	11
Schwab Financial Services Fund™	12
Schwab Health Care Fund™	13
Schwab® International Core Equity Fund	14
Fund Expenses	16
Financial Statements and Portfolio Holdings
Schwab Core Equity Fund™	17
Schwab Dividend Equity Fund™	25
Schwab Large-Cap Growth Fund™	32
Schwab Small-Cap Equity Fund™	39
Schwab Hedged Equity Fund™	49
Schwab Financial Services Fund™	59
Schwab Health Care Fund™	65
Schwab® International Core Equity Fund	72
Financial Notes	84
Trustees and Officers	96
Glossary	99

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM).
Distributor: Charles Schwab & Co., Inc. (Schwab).

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS), which was developed by, and is the exclusive property of, MSCI and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the schedules of Portfolio Holdings are sub-categories of Sector classifications.

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 2013
Schwab Core Equity Fundtm(Ticker Symbol: SWANX)	13.55%
S&P 500® Index	14.42%
Fund Category: Morningstar Large-Cap Blend	14.54%
Performance Details	page 7
Schwab Dividend Equity Fundtm(Ticker Symbol: SWDSX)	15.60%
S&P 500® Index	14.42%
Fund Category: Morningstar Large-Cap Value	15.17%
Performance Details	page 8
Schwab Large-Cap Growth Fundtm(Ticker Symbol: SWLSX)	13.33%
Russell 1000 Growth Index	13.71%
Fund Category: Morningstar Large-Cap Growth	12.89%
Performance Details	page 9
Schwab Small-Cap Equity Fundtm(Ticker Symbol: SWSCX)	19.26%
Russell 2000® Index	16.58%
Fund Category: Morningstar Small-Cap Blend	16.46%
Performance Details	page 10
Schwab Hedged Equity Fundtm(Ticker Symbol: SWHEX)	8.37%
S&P 500® Index	14.42%
Fund Category: Morningstar Long-Short	6.22%
Performance Details	page 11
Schwab Financial Services Fundtm(Ticker Symbol: SWFFX)	18.47%
S&P 1500 SuperComposite Financials Sector Index	18.90%
Fund Category: Morningstar Financial Services	16.88%
Performance Details	page 12
Schwab Health Care Fundtm1(Ticker Symbol: SWHFX)	20.91%
Dow Jones Global Health Care Index	20.36%
Fund Category: Morningstar Health Care	22.75%
Performance Details	page 13
Schwab® International Core Equity Fund1 (Ticker Symbol: SICNX)	16.90%
MSCI EAFE Index® (Gross)*	17.18%
Fund Category: Morningstar Foreign Large-Cap Blend	14.02%
Performance Details	pages 14-15

Minimum Initial Investment² $ 100

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

*	The MSCI EAFE Index® is a free float-adjusted market capitalization index that is designed to measure market equity performance in 22 developed market countries, excluding the U.S. and Canada. Investors cannot invest directly in any index and index figures do not include trading and management costs.
1	The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations, see financial note 2 for more information.
2	Please see the funds’ prospectus for further detail and eligibility requirements.

Schwab Active Equity Funds 3

From the President

Marie Chandoha is President and CEO of Charles Schwab Investment Management, Inc. and the funds covered in this report.

Dear Shareholder,

As President and CEO of Charles Schwab Investment Management, Inc., I’d like to thank you for trusting us to help you meet your investment goals, and for reading this important report concerning the Schwab Active Equity Funds. Each fund employs a disciplined approach to investing that attempts to balance risks and expected returns. Schwab Equity Ratings^® is our proprietary method of evaluating equities and plays a role in each fund’s multi-step security selection process.

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets. The backdrop for these performances included efforts undertaken by the Federal Reserve and many central banks around the world to stimulate faster economic growth by keeping interest rates low. This was particularly the case in Japan, where aggressive central bank policies helped fuel a rally by equities, while the yen depreciated sharply versus the U.S. dollar. In general, stocks benefited from these policies and from reduced concerns about the euro zone’s sovereign debt crisis and the U.S. fiscal cliff. Equities were also supported by some signs of improvement in the U.S. housing market.

Many U.S. stock market indices finished at or near record highs, while mid-cap stocks provided larger returns than small- and large-cap stocks. Shares of companies in the Health Care and Financials sectors generated some of the highest returns, while shares of companies in the Information Technology and Materials sectors underperformed by comparison. For the six months, the S&P 500 Index returned 14.4% and the MSCI EAFE Index (gross) returned 17.2%.

 Asset Class Performance Comparison % returns during the report period

This graph compares the performance of various asset classes during the report period. Final performance figures for the period are in the key below.

	14.42%	S&P 500® Index: measures U.S. large-cap stocks
	16.58%	Russell 2000® Index: measures U.S. small-cap stocks
	17.18%	MSCI EAFE® Index (Gross): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	0.90%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.04%	Three-Month U.S. Treasury Bills (T-bills): measures short-term U.S. Treasury obligations

Index figures assume dividends and distributions were reinvested, and do not include trading and management costs, which would lower performance. Indices are unmanaged, do not incur management fees, costs and expenses, and you cannot invest in them directly. Remember that past performance is not an indication of future results.

Data source: Index provider websites and CSIM.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views and portfolio holdings may have changed since the report date.

4 Schwab Active Equity Funds

From the President continued

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets.

We also wanted to share some exciting news about the long-term performance of our Schwab Hedged Equity Fund. Lipper named the fund as its “Best Long/Short Equity Fund over Ten Years” in March 2013.* This award reflects the results of our commitment to provide shareholders with high-quality investment solutions.

For more information about the Schwab Active Equity Funds, including the Schwab Hedged Equity Fund, please continue reading this report. In addition, you can find answers to frequently asked questions and more details about the funds by visiting www.schwabfunds.com. We are also happy to hear from you at 1-800-435-4000.

Sincerely,

* The Lipper Fund Awards recognize funds that have excelled in delivering consistently strong risk adjusted performance, relative to peers. Lipper, a Thomson Reuters company, uses the Lipper Leader for Consistent Return methodology to designate award-winning funds in most individual classifications for the 3-, 5-, and 10-year periods. Lipper Rankings are based on average annual total returns. As of 4/30/2013, the Schwab Hedged Equity Fund rankings within the Lipper Long/Short Equity Funds category for the 1-, 3-, 5-, and 10-year periods were 52/168, 38/95, 10/57, and 5/24, respectively.

Schwab Active Equity Funds 5

Fund Management

	Jonas Svallin, CFA Managing Director and Head of Disciplined Active Equity Strategies, leads the portfolio management team of Schwab’s disciplined active equity funds. He also has overall responsibility for all aspects of the management of the funds. Prior to joining CSIM in 2012, Mr. Svallin spent nearly three years as a partner and a director of quantitative analytics and research at Fiduciary Research & Consulting, where he provided oversight of quantitative analytics and risk management efforts. From 2003 until 2009, Mr. Svallin was a principal and head portfolio manager at Algert Coldiron Investors (ACI). Prior to joining ACI, Mr. Svallin worked as a quantitative research associate at RCM Capital Management and a senior consultant at FactSet Research Systems.
	Paul Alan Davis, CFA Managing Director and Senior Portfolio Manager, is responsible for the day-to-day co-management of the funds. Mr. Davis has been a portfolio manager with CSIM since 2004, and also worked in performance management, competitive analysis and fund administration since beginning his tenure at the firm in 2003. Prior to joining CSIM, Mr. Davis worked for several investment advisory firms in different capacities. His roles included portfolio management, trading and compliance. He has more than 12 years of experience in portfolio management.
	Wei Li, Ph.D., CFA Portfolio Manager, is responsible for the day-to-day co-management of each of the funds, except for Schwab Core Equity Fund, Schwab International Core Equity Fund, and Schwab Small-Cap Equity Fund. Prior to joining CSIM in 2012, Ms. Li spent more than ten years at BlackRock, Inc. (formerly Barclays Global Investors), where she held a number of positions. From 2001 to 2009, she worked in various roles in the Global Advanced Active group, including portfolio management and quantitative research for both U.S. and international equity markets. After 2009, she worked in the defined contribution research and product development area for almost two years.

6 Schwab Active Equity Funds

Schwab Core Equity Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab Core Equity Fundtm (7/1/96)		13.55	%		15.31	%		4.52	%		8.14	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Large-Cap Blend		14.54	%		15.95	%		4.18	%		7.49	%

Fund Expense Ratio⁴: 0.73%

 Statistics

Number of Holdings	138
Weighted Average Market Cap ($ x 1,000,000)	$88,272
Price/Earnings Ratio (P/E)	16.8
Price/Book Ratio (P/B)	2.0
Portfolio Turnover Rate5	53%

 Sector Weightings % of Investments

Information Technology	17.4%
Financials	16.3%
Health Care	13.3%
Consumer Discretionary	12.5%
Energy	10.9%
Consumer Staples	10.3%
Industrials	7.5%
Utilities	5.9%
Telecommunication Services	2.7%
Materials	2.2%
Other	1.0%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Wells Fargo & Co.	3.1%
Chevron Corp.	3.0%
Pfizer, Inc.	3.0%
JPMorgan Chase & Co.	2.8%
Apple, Inc.	2.6%
Oracle Corp.	2.0%
Thermo Fisher Scientific, Inc.	1.9%
Cisco Systems, Inc.	1.8%
Exxon Mobil Corp.	1.8%
PepsiCo, Inc.	1.7%
Total	23.7%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On May 21, 2009, the Laudus U.S. MarketMasters Fund merged into the fund. And, on September 7, 2012, the Schwab Premier Equity Fund merged into the fund (see financial note 12).
4	As stated in the prospectus. Reflects the total annual operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds 7

Schwab Dividend Equity Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Dividend Equity Fundtm (9/2/03)		15.60	%		17.62	%		5.51	%		8.22	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.04	%
Fund Category: Morningstar Large-Cap Value		15.17	%		18.19	%		3.95	%		6.87	%

Fund Expense Ratio⁴: 0.89%

 Yields¹

30-Day SEC Yield 1.67%

 Statistics

Number of Holdings	130
Weighted Average Market Cap ($ x 1,000,000)	$86,215
Price/Earnings Ratio (P/E)	8.2
Price/Book Ratio (P/B)	1.8
Portfolio Turnover Rate5	41%

 Sector Weightings % of Investments

Financials	25.6%
Energy	13.2%
Consumer Discretionary	10.9%
Health Care	9.7%
Information Technology	9.1%
Industrials	7.9%
Consumer Staples	7.9%
Utilities	6.8%
Materials	5.0%
Telecommunication Services	3.2%
Other	0.7%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Chevron Corp.	3.4%
JPMorgan Chase & Co.	3.4%
Wells Fargo & Co.	3.4%
Pfizer, Inc.	3.2%
General Electric Co.	2.9%
Exxon Mobil Corp.	2.9%
Merck & Co., Inc.	2.7%
Cisco Systems, Inc.	2.6%
ConocoPhillips	2.4%
AT&T, Inc.	2.1%
Total	29.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns or yields would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 7, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 7, 2009 is that of the fund’s former Select Shares.
4	As stated in the prospectus. Reflects the total annual operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.

8 Schwab Active Equity Funds

Schwab Large-Cap Growth Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Large-Cap Growth Fundtm (10/3/05)		13.33	%		11.10	%		5.18	%		5.09	%
Russell 1000 Growth Index		13.71	%		12.60	%		6.66	%		6.73	%
Fund Category: Morningstar Large-Cap Growth		12.89	%		10.56	%		4.47	%		5.39	%

Fund Expense Ratios⁴: Net 0.99%; Gross 1.05%

 Statistics

Number of Holdings	120
Weighted Average Market Cap ($ x 1,000,000)	$75,878
Price/Earnings Ratio (P/E)	16.9
Price/Book Ratio (P/B)	3.5
Portfolio Turnover Rate5	47%

 Sector Weightings % of Investments

Information Technology	30.2%
Consumer Discretionary	17.9%
Health Care	13.6%
Consumer Staples	11.0%
Industrials	9.5%
Financials	6.3%
Energy	4.4%
Materials	3.7%
Telecommunication Services	1.8%
Utilities	1.0%
Other	0.6%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

Apple, Inc.	4.7%
PepsiCo, Inc.	3.1%
Oracle Corp.	2.8%
Accenture plc, Class A	2.5%
Google, Inc., Class A	2.1%
Celgene Corp.	2.1%
The TJX Cos., Inc.	1.9%
Amgen, Inc.	1.9%
Symantec Corp.	1.9%
The Home Depot, Inc.	1.9%
Total	24.9%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 7, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 7, 2009 is that of the fund’s former Select Shares.
4	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds 9

Schwab Small-Cap Equity Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Small-Cap Equity Fundtm (7/1/03)		19.26	%		22.80	%		7.63	%		10.36	%
Russell 2000® Index		16.58	%		17.69	%		7.27	%		9.32	%
Fund Category: Morningstar Small-Cap Blend		16.46	%		16.46	%		6.68	%		9.13	%

Fund Expense Ratio⁴: 1.12%

 Statistics

Number of Holdings	369
Weighted Average Market Cap ($ x 1,000,000)	$1,421
Price/Earnings Ratio (P/E)	30.5
Price/Book Ratio (P/B)	1.7
Portfolio Turnover Rate5	56%

 Sector Weightings % of Investments

Financials	20.3%
Information Technology	19.3%
Health Care	14.4%
Industrials	13.8%
Consumer Discretionary	13.3%
Materials	7.0%
Energy	5.3%
Consumer Staples	3.2%
Utilities	1.9%
Telecommunication Services	0.7%
Other	0.8%
Total	100.0%

 Top Equity Holdings % of Net Assets⁶

PAREXEL International Corp.	0.9%
RLJ Lodging Trust	0.9%
EnerSys, Inc.	0.9%
Cubist Pharmaceuticals, Inc.	0.9%
STERIS Corp.	0.9%
First Industrial Realty Trust, Inc.	0.9%
The Children’s Place Retail Stores, Inc.	0.8%
DCT Industrial Trust, Inc.	0.8%
Acxiom Corp.	0.8%
Black Hills Corp.	0.8%
Total	8.6%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Small-company stocks are subject to greater volatility than other asset classes.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On September 28, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to September 28, 2009 is that of the fund’s former Select Shares.
4	As stated in the prospectus. Reflects the total annual operating expenses without contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.

10 Schwab Active Equity Funds

Schwab Hedged Equity Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab Hedged Equity Fundtm (9/3/02)		8.37	%		9.85	%		3.52	%		6.70	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Long-Short		6.22	%		5.85	%		2.00	%		5.14	%

Fund Expense Ratios⁴: Net 2.08%; Gross 2.13%

 Statistics

Number of Holdings
Long Holdings	129
Short Holdings	111
Weighted Average Market Cap ($ x 1,000,000)
Long Holdings	$59,262
Short Holdings	$5,851
Price/Earnings Ratio (P/E)
Long Holdings	16.0
Short Holdings	11.1
Price/Book Ratio (P/B)
Long Holdings	1.9
Short Holdings	2.6
Portfolio Turnover Rate5	72%
Portfolio Turnover Rate excluding short sales5	40%

 Top Equity Long Holdings

 % of Net Assets⁶

Pfizer, Inc.	3.0%
JPMorgan Chase & Co.	2.3%
Wells Fargo & Co.	2.3%
Apple, Inc.	2.2%
Symantec Corp.	2.1%
Total	11.9%

 Top Equity Short Holdings

 % of Net Assets⁶

Cirrus Logic, Inc.	1.1%
Walter Investment Management Corp.	1.0%
Pandora Media, Inc.	1.0%
The Hain Celestial Group, Inc.	0.9%
Dorman Products, Inc.	0.9%
Total	4.9%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

The Hedged Equity Fund’s long positions can decline in value at the same time the value of its shorted stocks increases, thereby increasing the potential for loss. The potential loss associated with short positions is much greater than the original value of the securities sold. The use of borrowing and short sales may cause the fund to have higher expenses than those of equity funds that do not use such techniques. 

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On September 28, 2009, the Investor Share class and Select Share class were combined into a single class of shares of the fund. The performance history of the fund prior to September 28, 2009 is that of the fund’s former Select Shares.
4	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds 11

Schwab Financial Services Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab Financial Services Fundtm (7/3/00)		18.47	%		20.85	%		-0.59	%		4.65	%
S&P 1500 SuperComposite Financials Sector Index		18.90	%		23.17	%		-3.48	%		1.03	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Financial Services		16.88	%		21.52	%		0.23	%		3.18	%

Fund Expense Ratios³: Net 0.94%; Gross 1.10%

 Statistics

Number of Holdings	60
Weighted Average Market Cap ($ x 1,000,000)	$65,981
Price/Earnings Ratio (P/E)	18.3
Price/Book Ratio (P/B)	1.2
Portfolio Turnover Rate4	55%

 Industry Weightings % of Investments

Diversified Financials	35.3%
Real Estate	23.1%
Insurance	22.2%
Banks	18.4%
Other	1.0%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Wells Fargo & Co.	8.5%
JPMorgan Chase & Co.	8.4%
Citigroup, Inc.	4.7%
Berkshire Hathaway, Inc,. Class B	4.5%
Bank of America Corp.	4.2%
The Goldman Sachs Group, Inc.	4.0%
Simon Property Group, Inc.	3.5%
The Travelers Cos., Inc.	3.0%
State Street Corp.	2.8%
The Bank of New York Mellon Corp.	2.8%
Total	46.4%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Since the Financial Services Fund focuses its investments on companies involved in specific sectors, this fund may involve a greater degree of risk than an investment in mutual funds that do not concentrate their investments.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
4	Not annualized.
5	This list is not a recommendation of any security by the investment adviser.

12 Schwab Active Equity Funds

Schwab Health Care Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab Health Care Fundtm (7/3/00)		20.91	%		29.26	%		11.88	%		13.79	%
Dow Jones Global Health Care Index		20.36	%		29.80	%		10.49	%		9.43	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Health Care		22.75	%		29.26	%		12.34	%		10.77	%

Fund Expense Ratios³: Net 0.82%; Gross 0.85%

 Statistics

Number of Holdings	106
Weighted Average Market Cap ($ x 1,000,000)	$79,918
Price/Earnings Ratio (P/E)	24.2
Price/Book Ratio (P/B)	2.9
Portfolio Turnover Rate4	21%

 Industry Weightings % of Investments

Pharmaceuticals, Biotechnology & Life Sciences	70.7%
Healthcare – Services	26.1%
Materials	0.4%
Capital Goods	0.3%
Other	2.5%
Total	100.0%

 Top Equity Holdings % of Net Assets⁵

Johnson & Johnson	6.6%
Pfizer, Inc.	6.4%
Merck & Co., Inc.	5.1%
Medtronic,Inc.	3.8%
Eli Lily & Co.	3.7%
Celgene Corp.	3.5%
Amgen, Inc.	3.4%
Novartis AG – Reg’d	3.4%
AbbVie, Inc.	3.0%
UnitedHealth Group, Inc.	3.0%
Total	41.9%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

The fund’s performance relative to the index may be affected by fair-value pricing, see financial note 2 for more information.

Since the Health Care Fund focuses its investments on companies involved in specific sectors, this fund may involve a greater degree of risk than an investment in mutual funds that do not concentrate their investments.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
4	Not annualized.
5	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds 13

Schwab^® International Core Equity Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			3 Years			Since Inception
Fund: Schwab® International Core Equity Fund (5/30/08)		16.90	%		21.68	%		10.20	%		0.27	%
MSCI EAFE Index® (Gross)*		17.18	%		19.96	%		7.96	%		-0.56	%
Fund Category: Morningstar Foreign Large-Cap Blend		14.02	%		15.45	%		6.55	%		-1.61	%

Fund Expense Ratios⁴: Net 0.87%; Gross 1.17%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

The fund’s performance relative to the index may be affected by fair-value pricing, see financial note 2 for more information.

*	The MSCI EAFE Index® is a free float-adjusted market capitalization index that is designed to measure market equity performance in 22 developed market countries, excluding the U.S. and Canada. Investors cannot invest directly in any index and index figures do not include trading and management costs.
1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 7, 2009, the Investor Share class, Select Share class and Institutional Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 7, 2009 is that of the fund’s former Institutional Shares. On December 3, 2009, the Laudus Rosenberg International Equity Fund merged into the fund.
4	As stated in the prospectus. Includes acquired fund fees and expenses incurred indirectly by the fund through its investments in other investment companies. The annualized weighted average expense ratio of these investment companies was 0.01%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.

14 Schwab Active Equity Funds

 Schwab^® International Core Equity Fund

Performance and Fund Facts as of 04/30/13 continued

 Statistics

Number of Holdings	217
Weighted Average Market Cap ($ x 1,000,000)	$59,802
Price/Earnings Ratio (P/E)	16.0
Price/Book Ratio (P/B)	0.7
Portfolio Turnover Rate1	47%

 Sector Weightings % of Investments

Financials	22.3%
Industrials	13.9%
Health Care	12.1%
Consumer Staples	11.8%
Consumer Discretionary	11.5%
Energy	8.8%
Materials	6.5%
Information Technology	5.5%
Utilities	3.3%
Telecommunication Services	2.4%
Other	1.9%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Novartis AG – Reg’d	2.4%
Roche Holding AG	2.1%
Unilever N.V. CVA	1.9%
AstraZeneca plc	1.9%
Siemens AG – Reg’d	1.9%
Mitsubishi UFJ Financial Group, Inc.	1.8%
Toyota Motor Corp.	1.7%
Japan Tobacco, Inc.	1.7%
BNP Paribas S.A.	1.7%
BP plc	1.6%
Total	18.7%

 Country Weightings % of Investments

Japan	21.7%
United Kingdom	20.7%
France	8.7%
Germany	8.2%
Australia	8.2%
Switzerland	7.9%
Netherlands	4.0%
Sweden	3.2%
Spain	2.9%
Hong Kong	2.6%
Other Countries	11.9%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Not annualized.
2	This list is not a recommendation of any security by the investment adviser.

Schwab Active Equity Funds 15

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you incur two types of costs: transaction costs, such as redemption fees, and ongoing costs, such as management fees, transfer agent and shareholder services fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in a fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning November 1, 2012 and held through April 30, 2013.

Actual Return lines in the table below provide information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ¸ $1,000 = 8.6), then multiply the result by the number given for your fund or share class under the heading entitled “Expenses Paid During Period.”

Hypothetical Return lines in the table below provide information about hypothetical account values and hypothetical expenses based on a fund’s or share class’ actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as redemption fees. If these transactional costs were included, your costs would have been higher.

					Ending
			Beginning		Account Value		Expenses Paid
	Expense Ratio1		Account Value		(Net of Expenses)		During Period2
	(Annualized)		at 11/1/12		at 4/30/13		11/1/12–4/30/13
Schwab Core Equity Fundtm
Actual Return		0.72%	$	1,000	$	1,135.50	$	3.81
Hypothetical 5% Return		0.72%	$	1,000	$	1,021.22	$	3.61
Schwab Dividend Equity Fundtm
Actual Return		0.89%	$	1,000	$	1,156.00	$	4.76
Hypothetical 5% Return		0.89%	$	1,000	$	1,020.38	$	4.46
Schwab Large-Cap Growth Fundtm
Actual Return		0.99%	$	1,000	$	1,133.30	$	5.31
Hypothetical 5% Return		0.99%	$	1,000	$	1,019.89	$	4.96
Schwab Small-Cap Equity Fundtm
Actual Return		1.10%	$	1,000	$	1,192.60	$	5.98
Hypothetical 5% Return		1.10%	$	1,000	$	1,019.34	$	5.51
Schwab Hedged Equity Fundtm
Actual Return		2.80%	$	1,000	$	1,083.70	$	14.47
Hypothetical 5% Return		2.80%	$	1,000	$	1,010.91	$	13.96
Schwab Financial Services Fundtm
Actual Return		0.94%	$	1,000	$	1,184.70	$	5.09
Hypothetical 5% Return		0.94%	$	1,000	$	1,020.13	$	4.71
Schwab Health Care Fundtm
Actual Return		0.82%	$	1,000	$	1,209.10	$	4.49
Hypothetical 5% Return		0.82%	$	1,000	$	1,020.73	$	4.11
Schwab® International Core Equity Fund
Actual Return		0.86%	$	1,000	$	1,169.00	$	4.63
Hypothetical 5% Return		0.86%	$	1,000	$	1,020.53	$	4.31

1	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.
2	Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year.

16 Schwab Active Equity Funds

Schwab Core Equity Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		18.80			16.81			15.78			14.26			13.43			20.49
Income (loss) from investment operations:
Net investment income (loss)		0.17			0.26			0.19			0.17			0.17			0.23
Net realized and unrealized gains (losses)		2.36			2.07			1.01			1.50			0.88			(7.06	)
Total from investment operations		2.53			2.33			1.20			1.67			1.05			(6.83	)
Less distributions:
Distributions from net investment income		(0.17	)		(0.34	)		(0.17	)		(0.15	)		(0.22	)		(0.18	)
Distributions from net realized gains		—			—			—			—			—			(0.05	)
Total distributions		(0.17	)		(0.34	)		(0.17	)		(0.15	)		(0.22	)		(0.23	)
Net asset value at end of period		21.16			18.80			16.81			15.78			14.26			13.43
Total return (%)		13.55	1		13.99			7.60			11.77			8.11			(33.71	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.72	2		0.72			0.73			0.73			0.75			0.75
Gross operating expenses		0.73	2		0.73			0.73			0.74			0.78			0.78
Net investment income (loss)		1.76	2		1.37			1.06			1.05			1.39			1.28
Portfolio turnover rate		53	1		45	3		35			49			41	4		35
Net assets, end of period ($ x 1,000,000)		2,081			1,880			1,719			1,792			1,770			1,449

* Unaudited.

¹ Not annualized.

² Annualized.

³ Portfolio turnover excludes the impact of investment activity from a merger with another fund. See financial note 12 for additional information.

⁴ Portfolio turnover excludes the impact of investment activity from a merger with another fund.

See financial notes 17

 Schwab Core Equity Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	99	.1%	Common Stock		1,730,878,388		2,061,035,189
	0	.9%	Other Investment Company		19,661,417		19,661,417
	0	.0%	Short-Term Investments		462,966		462,966
	100	.0%	Total Investments		1,751,002,771		2,081,159,572
	0	.3%	Collateral Invested for Securities on Loan		5,586,813		5,586,813
	(0	.3)%	Other Assets and Liabilities, Net				(5,550,511	)
	100	.0%	Total Net Assets				2,081,195,874

	Number		Value
Security	of Shares		($)
Common Stock 99.1% of net assets
Automobiles & Components 0.4%
Ford Motor Co.		528,000		7,238,880
Banks 3.2%
Ocwen Financial Corp. *		82,500		3,017,850
Wells Fargo & Co.		1,700,200		64,573,596
				67,591,446
Capital Goods 5.0%
3M Co.		34,700		3,633,437
AGCO Corp.		46,400		2,470,800
General Electric Co.		935,200		20,845,608
Honeywell International, Inc.		137,500		10,111,750
Ingersoll-Rand plc		51,500		2,770,700
Northrop Grumman Corp.		229,000		17,344,460
Roper Industries, Inc.		20,500		2,452,825
Textron, Inc.		717,000		18,462,750
The Boeing Co.		53,000		4,844,730
United Rentals, Inc. *		340,000		17,887,400
Wabtec Corp.		29,000		3,043,260
				103,867,720
Commercial & Professional Supplies 1.7%
Avery Dennison Corp.		266,300		11,038,135
Nielsen Holdings N.V.		224,000		7,754,880
The ADT Corp. *		368,500		16,081,340
				34,874,355
Consumer Durables & Apparel 1.2%
Hanesbrands, Inc. *		65,000		3,260,400
Jarden Corp. *		332,250		14,954,573
Mohawk Industries, Inc. *		52,000		5,765,760
				23,980,733
Consumer Services 2.2%
International Game Technology		1,537,600		26,062,320
MGM Resorts International *		200,000		2,824,000
Service Corp. International		314,200		5,303,696
Wyndham Worldwide Corp.		204,000		12,256,320
				46,446,336
Diversified Financials 7.4%
Bank of America Corp.		1,574,000		19,375,940
Citigroup, Inc.		315,000		14,697,900
JPMorgan Chase & Co.		1,181,240		57,892,572
Morgan Stanley		140,000		3,101,000
State Street Corp.		471,000		27,539,370
The Bank of New York Mellon Corp.		825,000		23,281,500
The Goldman Sachs Group, Inc.		60,500		8,837,235
				154,725,517
Energy 10.9%
Anadarko Petroleum Corp.		70,000		5,933,200
Chevron Corp.		515,100		62,847,351
ConocoPhillips		441,300		26,676,585
EOG Resources, Inc.		58,000		7,027,280
Exxon Mobil Corp.		415,100		36,939,749
Hess Corp.		54,700		3,948,246
Marathon Oil Corp.		592,500		19,356,975
Marathon Petroleum Corp.		190,700		14,943,252
Murphy Oil Corp.		270,565		16,799,381
National Oilwell Varco, Inc.		56,850		3,707,757
Occidental Petroleum Corp.		264,990		23,653,007
Phillips 66		42,900		2,614,755
Tesoro Corp.		61,000		3,257,400
				227,704,938
Food & Staples Retailing 2.2%
Costco Wholesale Corp.		260,000		28,191,800
CVS Caremark Corp.		69,900		4,066,782
Safeway, Inc.		225,000		5,067,000
The Kroger Co.		226,400		7,783,632
				45,109,214
Food, Beverage & Tobacco 5.8%
Archer-Daniels-Midland Co.		735,000		24,945,900
Bunge Ltd.		125,700		9,076,797
Coca-Cola Enterprises, Inc.		715,500		26,208,765
Hillshire Brands Co.		70,000		2,513,700
Ingredion, Inc.		228,200		16,432,682
Molson Coors Brewing Co., Class B		116,500		6,011,400

18 See financial notes

 Schwab Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
PepsiCo, Inc.		440,000		36,286,800
				121,476,044
Health Care Equipment & Services 3.0%
Baxter International, Inc.		35,000		2,445,450
Boston Scientific Corp. *		332,500		2,490,425
Cigna Corp.		437,500		28,949,375
Covidien plc		159,000		10,150,560
Medtronic, Inc.		360,500		16,828,140
UnitedHealth Group, Inc.		41,500		2,487,095
				63,351,045
Household & Personal Products 2.3%
Energizer Holdings, Inc.		126,000		12,170,340
The Procter & Gamble Co.		456,000		35,007,120
				47,177,460
Insurance 2.3%
Aflac, Inc.		208,500		11,350,740
American International Group, Inc. *		205,000		8,491,100
Berkshire Hathaway, Inc., Class B *		45,000		4,784,400
Prudential Financial, Inc.		40,000		2,416,800
Reinsurance Group of America, Inc.		76,500		4,785,075
The Travelers Cos., Inc.		129,000		11,017,890
Torchmark Corp.		74,000		4,593,180
				47,439,185
Materials 2.2%
Alcoa, Inc.		2,300,000		19,550,000
International Paper Co.		201,500		9,466,470
Monsanto Co.		45,000		4,806,900
PPG Industries, Inc.		43,800		6,444,732
Steel Dynamics, Inc.		319,000		4,797,760
				45,065,862
Media 2.0%
Comcast Corp., Class A		455,000		18,791,500
Lamar Advertising Co., Class A *		70,400		3,296,128
News Corp., Class A		280,000		8,671,600
Time Warner, Inc.		186,300		11,137,014
				41,896,242
Pharmaceuticals, Biotechnology & Life Sciences 10.3%
AbbVie, Inc.		220,000		10,131,000
Amgen, Inc.		198,652		20,701,525
Celgene Corp. *		298,000		35,184,860
Johnson & Johnson		85,000		7,244,550
Merck & Co., Inc.		584,080		27,451,760
Mylan, Inc. *		412,900		12,019,519
Pfizer, Inc.		2,125,400		61,785,378
Thermo Fisher Scientific, Inc.		480,700		38,782,876
				213,301,468
Real Estate 3.3%
CBL & Associates Properties, Inc.		118,500		2,860,590
Extra Space Storage, Inc.		221,400		9,648,612
National Retail Properties, Inc.		65,700		2,606,976
Prologis, Inc.		250,000		10,487,500
Simon Property Group, Inc.		121,000		21,546,470
Weyerhaeuser Co.		727,700		22,202,127
				69,352,275
Retailing 6.8%
Abercrombie & Fitch Co., Class A		378,100		18,738,636
Best Buy Co., Inc.		342,000		8,888,580
Foot Locker, Inc.		342,200		11,932,514
GameStop Corp., Class A (a)		171,000		5,967,900
Liberty Interactive Corp., Class A *		1,160,200		24,700,658
Macy’s, Inc.		666,500		29,725,900
Target Corp.		41,200		2,907,072
The Gap, Inc.		334,000		12,688,660
The Home Depot, Inc.		146,000		10,709,100
The TJX Cos., Inc.		301,000		14,679,770
				140,938,790
Semiconductors & Semiconductor Equipment 0.1%
LSI Corp. *		240,300		1,571,562
Software & Services 11.7%
Accenture plc, Class A		342,000		27,852,480
Activision Blizzard, Inc.		765,500		11,444,225
CA, Inc.		719,000		19,391,430
Cadence Design Systems, Inc. *		984,600		13,587,480
Cognizant Technology Solutions Corp., Class A *		190,000		12,312,000
Computer Sciences Corp.		470,500		22,042,925
Google, Inc., Class A *		14,500		11,956,265
International Business Machines Corp.		81,100		16,425,994
Jack Henry & Associates, Inc.		87,500		4,060,000
Microsoft Corp.		382,800		12,670,680
Oracle Corp.		1,263,400		41,414,252
Symantec Corp. *		1,360,300		33,055,290
Synopsys, Inc. *		357,342		12,710,655
Yahoo! Inc. *		150,500		3,721,865
				242,645,541
Technology Hardware & Equipment 5.6%
Apple, Inc.		123,000		54,458,250
Cisco Systems, Inc.		1,771,000		37,049,320
Hewlett-Packard Co.		209,500		4,315,700
TE Connectivity Ltd.		160,000		6,968,000
Western Digital Corp.		253,500		14,013,480
				116,804,750
Telecommunication Services 2.7%
AT&T, Inc.		739,100		27,686,686
Telephone & Data Systems, Inc.		257,671		5,782,137
Verizon Communications, Inc.		435,000		23,450,850
				56,919,673

See financial notes 19

 Schwab Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Transportation 0.9%
FedEx Corp.		191,000		17,955,910
Utilities 5.9%
Ameren Corp.		562,000		20,372,500
American Electric Power Co., Inc.		581,500		29,906,545
American Water Works Co., Inc.		157,200		6,583,536
CenterPoint Energy, Inc.		898,000		22,162,640
DTE Energy Co.		145,900		10,633,192
Edison International		144,000		7,747,200
NV Energy, Inc.		233,000		5,039,790
PG&E Corp.		311,000		15,064,840
Pinnacle West Capital Corp.		100,000		6,090,000
				123,600,243
Total Common Stock
(Cost $1,730,878,388)				2,061,035,189
Other Investment Company 0.9% of net assets
Money Market Fund 0.9%
State Street Institutional U.S. Government Money Market Fund		19,661,417		19,661,417
Total Other Investment Company
(Cost $19,661,417)				19,661,417
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.0% of net assets
U.S. Treasury Obligations 0.0%
U.S. Treasury Bills
0.03%, 06/20/13 (b)(c)		270,000		269,989
0.09%, 06/20/13 (b)(c)		193,000		192,977
Total Short-Term Investments
(Cost $462,966)				462,966
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.3% of net assets
State Street Institutional U.S. Government Money Market Fund		5,586,813		5,586,813
Total Collateral Invested for Securities on Loan
(Cost $5,586,813)				5,586,813
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $1,753,229,504 and the unrealized appreciation and depreciation were $335,764,904 and ($7,834,836), respectively, with a net unrealized appreciation of $327,930,068.

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	All or a portion of this security is held as collateral for open futures contracts.
(c)	The rate shown is the purchase yield.

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		125		9,951,250		194,469

20 See financial notes

 Schwab Core Equity Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$2,061,035,189		$—		$—		$2,061,035,189
Other Investment Company1		19,661,417		—		—		19,661,417
Short-Term Investments1		—		462,966		—		462,966
Total		$2,080,696,606		$462,966		$—		$2,081,159,572
Other Financial Instruments
Collateral Invested for Securities on Loan1		5,586,813		—		—		5,586,813
Futures Contract2		194,469		—		—		194,469

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 21

 Schwab Core Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $1,751,002,771) including securities on loan of $5,669,505		$2,081,159,572
Collateral invested for securities on loan		5,586,813
Receivables:
Investments sold		12,858,954
Dividends		1,309,200
Fund shares sold		1,034,990
Due from broker for futures		25,000
Income from securities on loan		4,599
Interest		51
Prepaid expenses	+	28,131
Total assets		2,102,007,310
Liabilities
Collateral held for securities on loan		5,586,813
Payables:
Investments bought		14,076,162
Investment adviser and administrator fees		80,572
Shareholder service fees		52,052
Fund shares redeemed		933,845
Accrued expenses	+	81,992
Total liabilities		20,811,436
Net Assets
Total assets		2,102,007,310
Total liabilities	−	20,811,436
Net assets		$2,081,195,874
Net Assets by Source
Capital received from investors		1,704,617,839
Net investment income not yet distributed		4,463,151
Net realized capital gains		41,763,614
Net unrealized capital gains		330,351,270
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$2,081,195,874		98,346,497			$21.16

22 See financial notes

 Schwab Core Equity Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $5,376)		$23,917,680
Interest		2,087
Securities on loan	+	241,211
Total investment income		24,160,978
Expenses
Investment adviser and administrator fees		4,569,711
Shareholder service fees		2,275,747
Transfer agent fees		59,312
Shareholder reports		51,189
Portfolio accounting fees		36,561
Custodian fees		22,889
Professional fees		20,315
Registration fees		15,938
Trustees’ fees		8,536
Interest expense		54
Other expenses	+	21,063
Total expenses		7,081,315
Expense reduction by CSIM and its affiliates	−	66,256
Custody credits	−	10
Net expenses	−	7,015,049
Net investment income		17,145,929
Realized and Unrealized Gains (Losses)
Net realized gains on investments		152,470,247
Net realized gains on futures contracts	+	830,533
Net realized gains		153,300,780
Net unrealized gains on investments		78,859,269
Net unrealized gains on futures contracts	+	621,384
Net unrealized gains	+	79,480,653
Net realized and unrealized gains		232,781,433
Increase in net assets resulting from operations		$249,927,362

See financial notes 23

 Schwab Core Equity Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$17,145,929			$23,675,409
Net realized gains		153,300,780			141,751,928
Net unrealized gains	+	79,480,653			52,306,627
Increase in net assets from operations		249,927,362			217,733,964
Distributions to Shareholders
Distributions from net investment income		($16,475,044	)		($32,156,180	)

Transactions in Fund Shares¹

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			5,324,013		$105,255,992			6,062,795		$109,887,310
Issued in connection with merger			—		—			11,283,566		216,114,348
Shares reinvested			445,622		8,359,860			836,086		14,755,613
Shares redeemed	+		(7,402,016	)	(145,947,966	)		(20,453,309	)	(365,280,788	)
Net transactions in fund shares			(1,632,381	)	($32,332,114	)		(2,270,862	)	($24,523,517	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			99,978,878		$1,880,075,670			102,249,740		$1,719,021,403
Total increase or decrease	+		(1,632,381	)	201,120,204			(2,270,862	)	161,054,267
End of period			98,346,497		$2,081,195,874			99,978,878		$1,880,075,670
Net investment income not yet distributed					$4,463,151					$3,792,266

¹ Effective September 7, 2012, all of the assets and liabilities of the Schwab Premier Equity Fund were transferred to the Schwab Core Equity Fund. (See financial note 12)

24 See financial notes

Schwab Dividend Equity Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		14.52			13.15			12.08			10.94			10.63			15.66
Income (loss) from investment operations:
Net investment income (loss)		0.17			0.27			0.23			0.21			0.25			0.32
Net realized and unrealized gains (losses)		2.08			1.38			1.06			1.14			0.31			(4.97	)
Total from investment operations		2.25			1.65			1.29			1.35			0.56			(4.65	)
Less distributions:
Distributions from net investment income		(0.17	)		(0.28	)		(0.22	)		(0.21	)		(0.25	)		(0.33	)
Distributions from net realized gains		—			—			—			—			—			(0.05	)
Total distributions		(0.17	)		(0.28	)		(0.22	)		(0.21	)		(0.25	)		(0.38	)
Net asset value at end of period		16.60			14.52			13.15			12.08			10.94			10.63
Total return (%)		15.60	2		12.65			10.73			12.42			5.62			(30.23	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.89	3		0.89			0.89			0.89			0.90	4		0.89
Gross operating expenses		0.89	3		0.89			0.89			0.89			0.91			0.89
Net investment income (loss)		2.26	3		1.89			1.77			1.74			2.40			2.33
Portfolio turnover rate		41	2		55			31			37			39			22
Net assets, end of period ($ x 1,000,000)		1,599			1,390			1,325			1,322			1,297			824

* Unaudited.

¹ Effective October 7, 2009, the Investor Shares class and the Select Shares class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Not annualized.

³ Annualized.

⁴ Effective May 5, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

See financial notes 25

 Schwab Dividend Equity Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	99	.0%	Common Stock		1,276,739,731		1,582,804,688
	0	.7%	Short-Term Investments		11,889,433		11,889,433
	99	.7%	Total Investments		1,288,629,164		1,594,694,121
	0	.3%	Other Assets and Liabilities, Net				4,640,673
	100	.0%	Total Net Assets				1,599,334,794

	Number		Value
Security	of Shares		($)
Common Stock 99.0% of net assets
Automobiles & Components 0.5%
Ford Motor Co.		500,000		6,855,000
Lear Corp.		23,000		1,328,940
				8,183,940
Banks 4.0%
Huntington Bancshares, Inc.		430,000		3,083,100
KeyCorp		264,000		2,632,080
Regions Financial Corp.		168,400		1,429,716
Synovus Financial Corp.		932,500		2,508,425
Wells Fargo & Co.		1,418,400		53,870,832
Zions Bancorp		40,000		984,800
				64,508,953
Capital Goods 7.1%
3M Co.		128,000		13,402,880
Fluor Corp.		168,200		9,584,036
GATX Corp.		84,100		4,284,895
General Electric Co.		2,086,100		46,499,169
L-3 Communications Holdings, Inc.		20,200		1,641,250
Northrop Grumman Corp.		217,200		16,450,728
Roper Industries, Inc.		31,000		3,709,150
The Boeing Co.		14,000		1,279,740
United Technologies Corp.		192,200		17,545,938
				114,397,786
Commercial & Professional Supplies 0.5%
R.R. Donnelley & Sons Co.		602,000		7,410,620
Consumer Durables & Apparel 2.6%
Hasbro, Inc.		251,500		11,913,555
Leggett & Platt, Inc.		233,000		7,511,920
Whirlpool Corp.		190,000		21,713,200
				41,138,675
Consumer Services 1.5%
H&R Block, Inc.		407,200		11,295,728
International Game Technology		368,000		6,237,600
Wyndham Worldwide Corp.		120,000		7,209,600
				24,742,928
Diversified Financials 12.2%
Bank of America Corp.		865,000		10,648,150
Citigroup, Inc.		406,700		18,976,622
JPMorgan Chase & Co.		1,102,684		54,042,543
Morgan Stanley		978,300		21,669,345
SLM Corp.		942,900		19,470,885
State Street Corp.		406,500		23,768,055
The Bank of New York Mellon Corp.		665,500		18,780,410
The Goldman Sachs Group, Inc.		193,400		28,249,938
				195,605,948
Energy 13.1%
Chevron Corp.		452,500		55,209,525
ConocoPhillips		642,000		38,808,900
EOG Resources, Inc.		26,500		3,210,740
Exxon Mobil Corp.		512,800		45,634,072
Hess Corp.		36,500		2,634,570
Marathon Oil Corp.		60,600		1,979,802
Marathon Petroleum Corp.		156,500		12,263,340
Murphy Oil Corp.		175,000		10,865,750
Nabors Industries Ltd.		510,000		7,542,900
Occidental Petroleum Corp.		200,000		17,852,000
Phillips 66		32,500		1,980,875
Tesoro Corp.		54,700		2,920,980
Valero Energy Corp.		219,200		8,838,144
				209,741,598
Food & Staples Retailing 1.4%
Costco Wholesale Corp.		40,900		4,434,787
CVS Caremark Corp.		132,800		7,726,304
Safeway, Inc.		247,000		5,562,440
Wal-Mart Stores, Inc.		67,600		5,253,872
				22,977,403
Food, Beverage & Tobacco 4.8%
Archer-Daniels-Midland Co.		757,000		25,692,580
ConAgra Foods, Inc.		125,000		4,421,250
Ingredion, Inc.		190,000		13,681,900
Kellogg Co.		160,000		10,406,400
Molson Coors Brewing Co., Class B		20,000		1,032,000
PepsiCo, Inc.		257,500		21,236,025
				76,470,155
Health Care Equipment & Services 2.1%
Baxter International, Inc.		89,000		6,218,430
Cigna Corp.		106,000		7,014,020

26 See financial notes

 Schwab Dividend Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Covidien plc		33,000		2,106,720
Medtronic, Inc.		319,200		14,900,256
UnitedHealth Group, Inc.		44,100		2,642,913
				32,882,339
Household & Personal Products 1.7%
Energizer Holdings, Inc.		9,100		878,969
The Procter & Gamble Co.		336,000		25,794,720
				26,673,689
Insurance 5.0%
Aflac, Inc.		153,500		8,356,540
Aspen Insurance Holdings Ltd.		42,000		1,603,980
Assurant, Inc.		80,900		3,845,986
MetLife, Inc.		65,000		2,534,350
Old Republic International Corp.		684,900		9,246,150
Protective Life Corp.		36,200		1,377,772
Prudential Financial, Inc.		321,700		19,437,114
Reinsurance Group of America, Inc.		40,300		2,520,765
StanCorp Financial Group, Inc.		18,600		803,148
The Hanover Insurance Group, Inc.		24,200		1,220,406
The Travelers Cos., Inc.		243,000		20,754,630
Unum Group		257,100		7,170,519
XL Group plc		17,200		535,608
				79,406,968
Materials 5.0%
International Paper Co.		422,000		19,825,560
MeadWestvaco Corp.		452,100		15,588,408
Monsanto Co.		92,000		9,827,440
PPG Industries, Inc.		118,700		17,465,518
Sonoco Products Co.		15,000		525,600
Steel Dynamics, Inc.		857,800		12,901,312
United States Steel Corp.		225,100		4,006,780
				80,140,618
Media 1.6%
Comcast Corp., Class A		195,000		8,053,500
News Corp., Class A		105,000		3,251,850
Time Warner, Inc.		240,500		14,377,090
				25,682,440
Pharmaceuticals, Biotechnology & Life Sciences 7.6%
Amgen, Inc.		160,000		16,673,600
Eli Lilly & Co.		192,900		10,682,802
Merck & Co., Inc.		929,100		43,667,700
Pfizer, Inc.		1,731,500		50,334,705
				121,358,807
Real Estate 4.3%
Apartment Investment & Management Co., Class A		217,700		6,772,647
DDR Corp.		427,400		7,838,516
Liberty Property Trust		163,000		7,007,370
National Retail Properties, Inc.		80,000		3,174,400
Prologis, Inc.		368,000		15,437,600
Retail Properties of America, Inc., Class A		185,500		2,840,005
Simon Property Group, Inc.		128,700		22,917,609
Weyerhaeuser Co.		70,000		2,135,700
				68,123,847
Retailing 4.6%
Abercrombie & Fitch Co., Class A		255,300		12,652,668
Best Buy Co., Inc.		270,000		7,017,300
Foot Locker, Inc.		453,000		15,796,110
GameStop Corp., Class A		76,000		2,652,400
Macy’s, Inc.		548,500		24,463,100
The Home Depot, Inc.		161,500		11,846,025
				74,427,603
Semiconductors & Semiconductor Equipment 0.8%
Applied Materials, Inc.		550,100		7,981,951
Microchip Technology, Inc.		153,000		5,572,260
				13,554,211
Software & Services 3.3%
Accenture plc, Class A		61,800		5,032,992
CA, Inc.		800,000		21,576,000
Computer Sciences Corp.		277,000		12,977,450
Fidelity National Information Services, Inc.		98,200		4,129,310
Jack Henry & Associates, Inc.		20,000		928,000
The Western Union Co.		507,000		7,508,670
				52,152,422
Technology Hardware & Equipment 5.0%
Cisco Systems, Inc.		1,939,500		40,574,340
Molex, Inc.		191,700		5,285,169
Seagate Technology plc		103,200		3,787,440
TE Connectivity Ltd.		526,000		22,907,300
Western Digital Corp.		136,000		7,518,080
				80,072,329
Telecommunication Services 3.2%
AT&T, Inc.		879,000		32,927,340
Telephone & Data Systems, Inc.		59,700		1,339,668
Verizon Communications, Inc.		304,800		16,431,768
				50,698,776
Transportation 0.3%
FedEx Corp.		46,500		4,371,465
Utilities 6.8%
Ameren Corp.		531,500		19,266,875
American Electric Power Co., Inc.		283,500		14,580,405
CenterPoint Energy, Inc.		75,000		1,851,000
DTE Energy Co.		443,100		32,293,128
Edison International		64,500		3,470,100
PG&E Corp.		237,000		11,480,280
Pinnacle West Capital Corp.		204,800		12,472,320

See financial notes 27

 Schwab Dividend Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Public Service Enterprise Group, Inc.		346,000		12,667,060
				108,081,168
Total Common Stock
(Cost $1,276,739,731)				1,582,804,688
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.7% of net assets
Time Deposit 0.6%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		10,372,555		10,372,555
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.04%, 06/20/13 (a)(b)		920,000		919,949
0.09%, 06/20/13 (a)(b)		597,000		596,929
				1,516,878
Total Short-Term Investments
(Cost $11,889,433)				11,889,433
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $1,289,122,159 and the unrealized appreciation and depreciation were $308,409,406 and ($2,837,444), respectively, with a net unrealized appreciation of $305,571,962.

(a)	All or a portion of this security is held as collateral for open futures contracts.
(b)	The rate shown is the purchase yield.

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		100		7,961,000		204,576

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$1,582,804,688		$—		$—		$1,582,804,688
Short-Term Investments1		—		11,889,433		—		11,889,433
Total		$1,582,804,688		$11,889,433		$—		$1,594,694,121
Other Financial Instruments
Futures Contract2		$204,576		$—		$—		$204,576

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

28 See financial notes

 Schwab Dividend Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $1,288,629,164)		$1,594,694,121
Receivables:
Investments sold		6,219,717
Fund shares sold		4,642,776
Dividends		1,671,528
Due from broker for futures		15,519
Interest		9
Prepaid expenses	+	24,959
Total assets		1,607,268,629
Liabilities
Payables:
Investments bought		6,844,100
Investment adviser and administrator fees		82,213
Shareholder service fees		29,208
Fund shares redeemed		904,864
Accrued expenses	+	73,450
Total liabilities		7,933,835
Net Assets
Total assets		1,607,268,629
Total liabilities	−	7,933,835
Net assets		$1,599,334,794
Net Assets by Source
Capital received from investors		1,250,963,666
Net investment income not yet distributed		1,392,302
Net realized capital gains		40,694,045
Net unrealized capital gains		306,284,781
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$1,599,334,794		96,336,472			$16.60

See financial notes 29

 Schwab Dividend Equity Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends		$22,692,800
Interest	+	2,302
Total investment income		22,695,102
Expenses
Investment adviser and administrator fees		4,478,152
Shareholder service fees		1,764,185
Shareholder reports		45,817
Portfolio accounting fees		33,820
Transfer agent fees		22,571
Professional fees		19,800
Registration fees		18,053
Custodian fees		15,225
Trustees’ fees		7,181
Interest expense		266
Other expenses	+	16,883
Total expenses		6,421,953
Expense reduction by CSIM and its affiliates	−	22,571
Net expenses	−	6,399,382
Net investment income		16,295,720
Realized and Unrealized Gains (Losses)
Net realized gains on investments		106,739,753
Net realized gains on futures contracts	+	330,258
Net realized gains		107,070,011
Net unrealized gains on investments		88,160,510
Net unrealized gains on futures contracts	+	382,457
Net unrealized gains	+	88,542,967
Net realized and unrealized gains		195,612,978
Increase in net assets resulting from operations		$211,908,698

30 See financial notes

 Schwab Dividend Equity Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$16,295,720			$26,554,898
Net realized gains		107,070,011			109,337,725
Net unrealized gains	+	88,542,967			30,109,544
Increase in net assets from operations		211,908,698			166,002,167
Distributions to Shareholders
Distributions from net investment income		($15,735,697	)		($28,261,739	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			9,323,806		$145,982,535			16,849,993		$235,314,886
Shares reinvested			573,317		8,563,270			1,092,546		15,437,629
Shares redeemed	+		(9,302,105	)	(141,665,678	)		(22,962,741	)	(322,803,726	)
Net transactions in fund shares			595,018		$12,880,127			(5,020,202	)	($72,051,211	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			95,741,454		$1,390,281,666			100,761,656		$1,324,592,449
Total increase or decrease	+		595,018		209,053,128			(5,020,202	)	65,689,217
End of period			96,336,472		$1,599,334,794			95,741,454		$1,390,281,666
Net investment income not yet distributed					$1,392,302					$832,279

See financial notes 31

Schwab Large-Cap Growth Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		12.48			11.18			10.48			9.10			8.22			12.77
Income (loss) from investment operations:
Net investment income (loss)		0.08			0.07			0.07			0.05			0.05			0.06
Net realized and unrealized gains (losses)		1.57			1.29			0.69			1.39			0.87			(4.56	)
Total from investment operations		1.65			1.36			0.76			1.44			0.92			(4.50	)
Less distributions:
Distributions from net investment income		(0.13	)		(0.06	)		(0.06	)		(0.06	)		(0.04	)		(0.05	)
Net asset value at end of period		14.00			12.48			11.18			10.48			9.10			8.22
Total return (%)		13.33	2		12.18			7.25			15.83			11.36			(35.36	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.99	3		0.99			0.99			1.00	4		0.99			0.99
Gross operating expenses		1.05	3		1.05			1.05			1.04			1.03			1.01
Net investment income (loss)		1.24	3		0.53			0.56			0.39			0.65			0.53
Portfolio turnover rate		47	2		79			62			57			63			49
Net assets, end of period ($ x 1,000,000)		234			217			213			219			360			332

* Unaudited.

¹ Effective October 7, 2009, the Investor Shares class and the Select Shares class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Not annualized.

³ Annualized.

⁴ The ratio of net operating expenses would have been 0.99%, if certain non-routine expenses had not been incurred.

32 See financial notes

 Schwab Large-Cap Growth Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	98	.9%	Common Stock		193,808,402		231,956,521
	0	.6%	Short-Term Investments		1,366,797		1,366,797
	99	.5%	Total Investments		195,175,199		233,323,318
	0	.5%	Collateral Invested for Securities on Loan		1,149,870		1,149,870
	0	.0%	Other Assets and Liabilities, Net				(24,503	)
	100	.0%	Total Net Assets				234,448,685

	Number		Value
Security	of Shares		($)
Common Stock 98.9% of net assets
Automobiles & Components 0.7%
Ford Motor Co.		81,400		1,115,994
Lear Corp.		10,000		577,800
				1,693,794
Banks 0.5%
Ocwen Financial Corp. *		4,200		153,636
Wells Fargo & Co.		26,900		1,021,662
				1,175,298
Capital Goods 5.7%
3M Co.		4,500		471,195
AGCO Corp.		32,400		1,725,300
Honeywell International, Inc.		33,100		2,434,174
Masco Corp.		54,400		1,057,536
Roper Industries, Inc.		11,800		1,411,870
Textron, Inc.		48,000		1,236,000
The Boeing Co.		22,300		2,038,443
United Rentals, Inc. *		35,500		1,867,655
United Technologies Corp.		12,500		1,141,125
USG Corp. *		2,000		51,980
				13,435,278
Commercial & Professional Supplies 2.4%
Avery Dennison Corp.		65,500		2,714,975
Equifax, Inc.		39,200		2,399,040
Pitney Bowes, Inc. (a)		20,500		280,235
Tyco International Ltd.		9,500		305,140
				5,699,390
Consumer Durables & Apparel 2.1%
Fossil, Inc. *		11,000		1,079,320
Hanesbrands, Inc. *		40,000		2,006,400
Mohawk Industries, Inc. *		1,000		110,880
NIKE, Inc., Class B		23,200		1,475,520
Whirlpool Corp.		2,500		285,700
				4,957,820
Consumer Services 2.7%
H&R Block, Inc.		35,400		981,996
International Game Technology		164,900		2,795,055
Service Corp. International		25,800		435,504
Wyndham Worldwide Corp.		34,000		2,042,720
				6,255,275
Diversified Financials 1.1%
Affiliated Managers Group, Inc. *		12,000		1,868,160
JPMorgan Chase & Co.		11,500		563,615
SLM Corp.		5,800		119,770
				2,551,545
Energy 4.3%
Chevron Corp.		24,000		2,928,240
ConocoPhillips		7,000		423,150
EOG Resources, Inc.		29,000		3,513,640
Marathon Oil Corp.		56,000		1,829,520
Marathon Petroleum Corp.		6,500		509,340
Murphy Oil Corp.		11,300		701,617
Occidental Petroleum Corp.		3,100		276,706
				10,182,213
Food & Staples Retailing 2.7%
Costco Wholesale Corp.		16,600		1,799,938
CVS Caremark Corp.		19,800		1,151,964
Safeway, Inc.		13,500		304,020
The Kroger Co.		87,400		3,004,812
				6,260,734
Food, Beverage & Tobacco 7.7%
Archer-Daniels-Midland Co.		36,600		1,242,204
Coca-Cola Enterprises, Inc.		86,900		3,183,147
Hillshire Brands Co.		87,000		3,124,170
Ingredion, Inc.		25,300		1,821,853
Kellogg Co.		22,500		1,463,400
PepsiCo, Inc.		88,300		7,282,101
				18,116,875
Health Care Equipment & Services 3.8%
Baxter International, Inc.		10,000		698,700
Becton, Dickinson & Co.		5,000		471,500
Cigna Corp.		28,500		1,885,845
Covidien plc		43,900		2,802,576
Henry Schein, Inc. *		24,000		2,169,600
Medtronic, Inc.		8,400		392,112

See financial notes 33

 Schwab Large-Cap Growth Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Sirona Dental Systems, Inc. *		7,700		566,258
				8,986,591
Household & Personal Products 0.6%
Energizer Holdings, Inc.		14,500		1,400,555
Insurance 0.7%
Aflac, Inc.		28,500		1,551,540
Materials 3.7%
International Paper Co.		60,300		2,832,894
Monsanto Co.		18,500		1,976,170
PPG Industries, Inc.		20,300		2,986,942
Steel Dynamics, Inc.		58,100		873,824
				8,669,830
Media 2.7%
AMC Networks, Inc., Class A *		13,000		819,130
Comcast Corp., Class A		100,000		4,130,000
Lamar Advertising Co., Class A *		14,900		697,618
News Corp., Class A		20,000		619,400
				6,266,148
Pharmaceuticals, Biotechnology & Life Sciences 9.7%
AbbVie, Inc.		42,000		1,934,100
Amgen, Inc.		43,000		4,481,030
Celgene Corp. *		40,900		4,829,063
Eli Lilly & Co.		12,600		697,788
Merck & Co., Inc.		18,600		874,200
Mylan, Inc. *		100,800		2,934,288
Pfizer, Inc.		129,900		3,776,193
Thermo Fisher Scientific, Inc.		33,200		2,678,576
Warner Chilcott plc, Class A		41,000		589,580
				22,794,818
Real Estate 4.0%
Apartment Investment & Management Co., Class A		6,500		202,215
Extra Space Storage, Inc.		30,000		1,307,400
Simon Property Group, Inc.		15,000		2,671,050
Taubman Centers, Inc.		30,000		2,565,300
Weyerhaeuser Co.		88,100		2,687,931
				9,433,896
Retailing 9.7%
Abercrombie & Fitch Co., Class A		40,200		1,992,312
Best Buy Co., Inc.		28,500		740,715
Foot Locker, Inc.		43,000		1,499,410
Liberty Interactive Corp., Class A *		107,000		2,278,030
Macy’s, Inc.		86,400		3,853,440
Target Corp.		7,100		500,976
The Gap, Inc.		64,500		2,450,355
The Home Depot, Inc.		60,800		4,459,680
The TJX Cos., Inc.		93,500		4,559,995
Urban Outfitters, Inc. *		7,500		310,800
				22,645,713
Semiconductors & Semiconductor Equipment 2.4%
Applied Materials, Inc.		103,700		1,504,687
Freescale Semiconductor Ltd. (a)*		115,400		1,786,392
LSI Corp. *		349,900		2,288,346
				5,579,425
Software & Services 18.8%
Accenture plc, Class A		72,600		5,912,544
CA, Inc.		100,000		2,697,000
Cadence Design Systems, Inc. *		213,500		2,946,300
Cognizant Technology Solutions Corp., Class A *		3,000		194,400
Computer Sciences Corp.		28,000		1,311,800
Google, Inc., Class A *		6,100		5,029,877
International Business Machines Corp.		19,600		3,969,784
Jack Henry & Associates, Inc.		30,300		1,405,920
Microsoft Corp.		132,900		4,398,990
Oracle Corp.		203,500		6,670,730
Solera Holdings, Inc.		3,500		201,530
Symantec Corp. *		184,300		4,478,490
Synopsys, Inc. *		34,500		1,227,165
The Western Union Co.		218,900		3,241,909
Yahoo! Inc. *		20,000		494,600
				44,181,039
Technology Hardware & Equipment 8.8%
Amphenol Corp., Class A		11,200		845,824
Apple, Inc.		25,000		11,068,750
Cisco Systems, Inc.		76,300		1,596,196
EMC Corp. *		95,000		2,130,850
Hewlett-Packard Co.		37,500		772,500
TE Connectivity Ltd.		57,000		2,482,350
Western Digital Corp.		31,000		1,713,680
				20,610,150
Telecommunication Services 1.8%
Verizon Communications, Inc.		76,500		4,124,115
Transportation 1.3%
Delta Air Lines, Inc. *		82,500		1,414,050
Hertz Global Holdings, Inc. *		71,300		1,716,904
				3,130,954
Utilities 1.0%
American Electric Power Co., Inc.		33,500		1,722,905
CenterPoint Energy, Inc.		21,500		530,620
				2,253,525
Total Common Stock
(Cost $193,808,402)				231,956,521

34 See financial notes

 Schwab Large-Cap Growth Fund

Portfolio Holdings (Unaudited) continued

	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.6% of net assets
Time Deposit 0.6%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		1,306,800		1,306,800
U.S. Treasury Obligation 0.0%
U.S. Treasury Bill
0.03%, 06/20/13 (b)(c)		60,000		59,997
Total Short-Term Investments
(Cost $1,366,797)				1,366,797
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.5% of net assets
Wells Fargo Advantage Government Money Market Fund		1,149,870		1,149,870
Total Collateral Invested for Securities on Loan
(Cost $1,149,870)				1,149,870
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $195,291,388 and the unrealized appreciation and depreciation were $39,751,487 and ($1,719,557), respectively, with a net unrealized appreciation of $38,031,930.

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	All or a portion of this security is held as collateral for open futures contracts.
(c)	The rate shown is the purchase yield.

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		15		1,194,150		17,186

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$231,956,521		$—		$—		$231,956,521
Short-Term Investments1		—		1,366,797		—		1,366,797
Total		$231,956,521		$1,366,797		$—		$233,323,318
Other Financial Instruments
Collateral Invested for Securities on Loan		$1,149,870		$—		$—		$1,149,870
Futures Contracts2		17,186		—		—		17,186

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 35

 Schwab Large-Cap Growth Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $195,175,199) including securities on loan of $1,067,062		$233,323,318
Collateral invested for securities on loan		1,149,870
Receivables:
Investments sold		2,940,414
Fund shares sold		169,112
Dividends		97,043
Due from broker for futures		3,000
Income from securities on loan		375
Foreign tax reclaims		304
Interest		1
Prepaid expenses	+	6,304
Total assets		237,689,741
Liabilities
Collateral held for securities on loan		1,149,870
Payables:
Investments bought		1,926,725
Investment adviser and administrator fees		12,910
Shareholder service fees		5,042
Fund shares redeemed		94,779
Accrued expenses	+	51,730
Total liabilities		3,241,056
Net Assets
Total assets		237,689,741
Total liabilities	−	3,241,056
Net assets		$234,448,685
Net Assets by Source
Capital received from investors		227,597,148
Net investment income not yet distributed		45,539
Net realized capital losses		(31,359,307	)
Net unrealized capital gains		38,165,305
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$234,448,685		16,748,784			$14.00

36 See financial notes

 Schwab Large-Cap Growth Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $228)		$2,432,631
Interest		297
Securities on loan	+	36,604
Total investment income		2,469,532
Expenses
Investment adviser and administrator fees		797,531
Shareholder service fees		273,097
Shareholder reports		22,676
Portfolio accounting fees		20,222
Professional fees		16,495
Registration fees		12,740
Transfer agent fees		10,689
Custodian fees		4,442
Trustees’ fees		3,541
Interest expense		21
Other expenses	+	2,791
Total expenses		1,164,245
Expense reduction by CSIM and its affiliates	−	67,619
Net expenses	−	1,096,626
Net investment income		1,372,906
Realized and Unrealized Gains (Losses)
Net realized gains on investments		14,466,178
Net realized gains on futures contracts	+	59,810
Net realized gains		14,525,988
Net unrealized gains on investments		12,128,057
Net unrealized gains on futures contracts	+	64,621
Net unrealized gains	+	12,192,678
Net realized and unrealized gains		26,718,666
Increase in net assets resulting from operations		$28,091,572

See financial notes 37

 Schwab Large-Cap Growth Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$1,372,906			$1,181,258
Net realized gains		14,525,988			29,419,021
Net unrealized gains (losses)	+	12,192,678			(5,506,943	)
Increase in net assets from operations		28,091,572			25,093,336
Distributions to Shareholders
Distributions from net investment income		($2,200,706	)		($1,032,046	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,112,709		$14,389,499			2,590,944		$31,765,041
Shares reinvested			94,231		1,176,943			45,504		506,911
Shares redeemed	+		(1,856,183	)	(24,106,345	)		(4,310,391	)	(52,516,380	)
Net transactions in fund shares			(649,243	)	($8,539,903	)		(1,673,943	)	($20,244,428	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			17,398,027		$217,097,722			19,071,970		$213,280,860
Total increase or decrease	+		(649,243	)	17,350,963			(1,673,943	)	3,816,862
End of period			16,748,784		$234,448,685			17,398,027		$217,097,722
Net investment income not yet distributed					$45,539					$873,339

38 See financial notes

Schwab Small-Cap Equity Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		17.72			15.61			13.96			11.14			10.55			18.22
Income (loss) from investment operations:
Net investment income (loss)		0.09			0.02			(0.01	)		(0.04	)		(0.02	)		(0.01	)
Net realized and unrealized gains (losses)		3.31			2.10			1.66			2.86			0.61			(6.59	)
Total from investment operations		3.40			2.12			1.65			2.82			0.59			(6.60	)
Less distributions:
Distributions from net investment income		(0.10	)		(0.01	)		—			—			(0.00	)2		—
Distributions from net realized gains		—			—			—			—			—			(1.07	)
Total distributions		(0.10	)		(0.01	)		—			—			(0.00	)2		(1.07	)
Net asset value at end of period		21.02			17.72			15.61			13.96			11.14			10.55
Total return (%)		19.26	3		13.57			11.82			25.31			5.65			(38.16	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.10	4,5		1.12			1.11			1.12			1.12			1.11
Gross operating expenses		1.11	4		1.12			1.12			1.14			1.17			1.12
Net investment income (loss)		0.91	4		0.11			(0.05	)		(0.26	)		(0.16	)		(0.09	)
Portfolio turnover rate		56	3		101			72			64			85			50
Net assets, end of period ($ x 1,000,000)		468			388			226			219			202			79

* Unaudited.

¹ Effective September 28, 2009, the Investor Shares class and the Select Shares class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Amount is less than $0.01.

³ Not annualized.

⁴ Annualized.

⁵ The ratio of net operating expenses would have been 1.11%, if a voluntary reduction of Investment Adviser fees had not been incurred. See financial note 4.

See financial notes 39

 Schwab Small-Cap Equity Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	99	.1%	Common Stock		388,633,632		463,925,665
	0	.8%	Short-Term Investments		3,826,965		3,826,965
	99	.9%	Total Investments		392,460,597		467,752,630
	0	.5%	Collateral Invested for Securities on Loan		2,288,625		2,288,625
	(0	.4)%	Other Assets and Liabilities, Net				(1,734,022	)
	100	.0%	Total Net Assets				468,307,233

	Number		Value
Security	of Shares		($)
Common Stock 99.1% of net assets
Automobiles & Components 0.5%
Cooper Tire & Rubber Co.		30,900		769,101
Dana Holding Corp.		52,858		911,801
Standard Motor Products, Inc.		14,500		444,280
				2,125,182
Banks 5.8%
1st Source Corp.		25,600		602,368
BancFirst Corp.		15,900		665,256
Bank of Kentucky Financial Corp.		7,400		194,028
Cathay General Bancorp		11,900		234,549
Chemical Financial Corp.		35,100		870,480
Columbia Banking System, Inc.		47,200		1,013,384
Community Trust Bancorp, Inc.		8,500		294,270
F.N.B. Corp.		287,800		3,278,042
First BanCorp *		108,300		640,053
First Defiance Financial Corp.		17,200		389,408
First Midwest Bancorp, Inc.		36,700		460,585
Heritage Commerce Corp. *		19,400		127,458
IBERIABANK Corp.		14,000		638,680
MainSource Financial Group, Inc.		23,100		292,677
MB Financial, Inc.		65,900		1,631,684
Northwest Bancshares, Inc.		155,500		1,904,875
Ocwen Financial Corp. *		27,900		1,020,582
Peoples Bancorp, Inc.		6,500		132,470
Pinnacle Financial Partners, Inc. *		27,400		664,998
PrivateBancorp, Inc.		125,500		2,407,090
Renasant Corp.		12,500		285,250
S&T Bancorp, Inc.		11,600		218,892
StellarOne Corp.		23,400		350,766
Susquehanna Bancshares, Inc.		114,300		1,333,881
Synovus Financial Corp.		1,025,100		2,757,519
Union First Market Bankshares Corp.		13,100		247,721
United Community Banks, Inc. *		117,000		1,281,150
Walker & Dunlop, Inc. *		33,000		587,730
Webster Financial Corp.		20,500		479,085
WesBanco, Inc.		33,800		846,014
Western Alliance Bancorp *		82,500		1,213,575
				27,064,520
Capital Goods 10.1%
AAR Corp.		102,200		1,825,292
Aceto Corp.		124,300		1,292,720
AECOM Technology Corp. *		40,000		1,162,800
Albany International Corp., Class A		62,100		1,804,005
Altra Holdings, Inc.		20,400		543,660
Apogee Enterprises, Inc.		71,300		1,816,724
AZZ, Inc.		14,508		613,543
Curtiss-Wright Corp.		52,600		1,727,384
Ducommun, Inc. *		4,100		100,409
EMCOR Group, Inc.		18,000		673,200
EnerSys, Inc. *		91,700		4,203,528
Esterline Technologies Corp. *		41,100		3,084,144
Federal Signal Corp. *		22,500		174,600
Flow International Corp. *		121,700		445,422
FreightCar America, Inc.		57,700		1,204,776
GATX Corp.		62,800		3,199,660
General Cable Corp. *		95,400		3,289,392
Gibraltar Industries, Inc. *		64,900		1,213,630
Granite Construction, Inc.		49,500		1,369,665
Griffon Corp.		47,200		486,160
Harsco Corp.		127,700		2,787,691
Huntington Ingalls Industries, Inc.		23,300		1,232,570
Hurco Cos., Inc. *		9,200		246,836
Hyster-Yale Materials Handling, Inc.		20,500		1,069,895
Insteel Industries, Inc.		8,500		140,930
John Bean Technologies Corp.		87,300		1,810,602
Kadant, Inc.		25,500		705,585
L.B. Foster Co., Class A		16,000		706,400
Lydall, Inc. *		55,300		793,002
Moog, Inc., Class A *		61,500		2,841,915
Mueller Water Products, Inc., Class A		133,700		791,504
Northwest Pipe Co. *		7,400		201,946
Standex International Corp.		34,300		1,814,470
Terex Corp. *		18,700		534,820
Watts Water Technologies, Inc., Class A		31,600		1,487,096
				47,395,976
Commercial & Professional Supplies 1.4%
G&K Services, Inc., Class A		39,000		1,832,610
Heidrick & Struggles International, Inc.		19,100		252,502
Hudson Global, Inc. *		31,400		103,620
Kelly Services, Inc., Class A		13,100		222,962
RPX Corp. *		80,400		1,078,164
Steelcase, Inc., Class A		119,000		1,511,300
The Brink’s Co.		30,100		797,951
US Ecology, Inc.		6,500		176,800
Viad Corp.		31,000		807,550
				6,783,459

40 See financial notes

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Consumer Durables & Apparel 2.5%
Brunswick Corp.		6,900		218,454
CSS Industries, Inc.		14,800		424,168
Culp, Inc.		12,400		201,376
Helen of Troy Ltd. *		21,600		753,408
Jarden Corp. *		33,050		1,487,581
Johnson Outdoors, Inc., Class A *		7,100		166,566
La-Z-Boy, Inc.		51,600		931,896
NACCO Industries, Inc., Class A		24,400		1,415,688
Quiksilver, Inc. *		28,200		189,786
Skechers U.S.A., Inc., Class A *		75,100		1,560,578
The Jones Group, Inc.		197,100		2,759,400
Unifi, Inc. *		24,000		468,000
Universal Electronics, Inc. *		51,000		1,171,980
				11,748,881
Consumer Services 4.3%
Ascent Capital Group, Inc., Class A *		48,100		3,198,169
Corinthian Colleges, Inc. *		294,000		588,000
Cracker Barrel Old Country Store, Inc.		28,000		2,316,720
International Speedway Corp., Class A		11,500		378,005
Jack in the Box, Inc. *		104,800		3,757,080
Multimedia Games Holding Co., Inc. *		107,900		2,660,814
Regis Corp.		29,000		543,750
Ruby Tuesday, Inc. *		29,200		281,488
Ruth’s Hospitality Group, Inc. *		70,095		694,641
Service Corp. International		194,000		3,274,720
SHFL Entertainment, Inc. *		63,700		1,006,460
Stewart Enterprises, Inc., Class A		102,700		915,057
Universal Technical Institute, Inc.		64,600		766,802
				20,381,706
Diversified Financials 4.5%
Calamos Asset Management, Inc., Class A		122,200		1,386,970
Evercore Partners, Inc., Class A		96,200		3,631,550
FBR & Co. *		12,300		256,209
First Cash Financial Services, Inc. *		42,800		2,202,916
FXCM, Inc., Class A		199,700		2,705,935
Gain Capital Holdings, Inc.		21,799		107,469
Interactive Brokers Group, Inc., Class A		166,700		2,510,502
Investment Technology Group, Inc. *		295,100		3,213,639
Nelnet, Inc., Class A		28,500		969,000
Oppenheimer Holdings, Inc., Class A		20,600		381,100
PHH Corp. *		55,100		1,161,508
Piper Jaffray Cos., Inc. *		58,000		1,958,080
SWS Group, Inc. *		94,300		536,567
				21,021,445
Energy 5.3%
Alon USA Energy, Inc.		117,700		1,953,820
Alpha Natural Resources, Inc. *		16,000		118,720
Basic Energy Services, Inc. *		58,100		797,713
Bristow Group, Inc.		57,000		3,602,400
Dawson Geophysical Co. *		24,700		759,278
Delek US Holdings, Inc.		68,500		2,472,165
EPL Oil & Gas, Inc. *		74,500		2,433,915
Exterran Holdings, Inc. *		11,000		290,620
Green Plains Renewable Energy, Inc. *		181,400		2,269,314
Hercules Offshore, Inc. *		175,600		1,294,172
ION Geophysical Corp. *		123,600		771,264
Knightsbridge Tankers Ltd. (a)		48,300		330,855
Natural Gas Services Group, Inc. *		14,600		294,774
Parker Drilling Co. *		395,500		1,629,460
REX American Resources Corp. *		15,400		287,826
SemGroup Corp., Class A *		17,100		886,635
Stone Energy Corp. *		45,500		897,715
Targa Resources Corp.		25,800		1,696,608
VAALCO Energy, Inc. *		176,200		1,184,064
Warren Resources, Inc. *		384,600		1,011,498
				24,982,816
Food & Staples Retailing 1.0%
Rite Aid Corp. *		608,100		1,611,465
The Andersons, Inc.		24,000		1,308,480
The Pantry, Inc. *		121,800		1,779,498
				4,699,443
Food, Beverage & Tobacco 1.7%
Alliance One International, Inc. *		33,500		125,625
Coca-Cola Bottling Co. Consolidated		14,500		891,750
Farmer Brothers Co. *		48,410		733,412
Pilgrim’s Pride Corp. *		113,800		1,114,102
Sanderson Farms, Inc.		10,700		655,482
Seneca Foods Corp., Class A *		7,100		231,389
TreeHouse Foods, Inc. *		11,000		700,810
Universal Corp.		63,600		3,660,180
				8,112,750
Health Care Equipment & Services 8.6%
Alere, Inc. *		139,700		3,587,496
Allscripts Healthcare Solutions, Inc. *		74,000		1,024,160
AMN Healthcare Services, Inc. *		38,800		532,724
AmSurg Corp. *		4,300		144,308
ArthroCare Corp. *		22,600		783,090
Cantel Medical Corp.		55,350		1,749,613
CONMED Corp.		108,800		3,408,704
CryoLife, Inc.		46,100		276,600
Cynosure, Inc., Class A *		36,600		946,476
Five Star Quality Care, Inc. *		21,000		99,330
Gentiva Health Services, Inc. *		13,100		137,419
Hill-Rom Holdings, Inc.		94,800		3,229,836
ICU Medical, Inc. *		49,400		2,976,350
Integra LifeSciences Holdings Corp. *		15,700		549,971
Magellan Health Services, Inc. *		63,600		3,253,776
MedAssets, Inc. *		196,300		3,676,699
National Healthcare Corp.		11,100		515,373
NuVasive, Inc. *		30,400		637,488
Omnicell, Inc. *		32,200		580,244
RTI Biologics, Inc. *		130,800		520,584
STERIS Corp.		99,300		4,129,887
SurModics, Inc. *		96,500		2,552,425
Symmetry Medical, Inc. *		181,500		2,163,480
The Providence Service Corp. *		11,700		204,867
Triple-S Management Corp., Class B *		14,000		252,420

See financial notes 41

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Vanguard Health Systems, Inc. *		17,800		260,414
West Pharmaceutical Services, Inc.		8,300		530,038
Wright Medical Group, Inc. *		60,800		1,425,152
				40,148,924
Household & Personal Products 0.4%
Inter Parfums, Inc.		29,200		845,924
Prestige Brands Holdings, Inc. *		30,400		819,280
Revlon, Inc., Class A *		17,300		334,755
				1,999,959
Insurance 1.2%
American Equity Investment Life Holding Co.		90,900		1,385,316
CNO Financial Group, Inc.		22,400		253,568
First American Financial Corp.		28,500		762,945
Maiden Holdings Ltd.		67,600		698,308
Platinum Underwriters Holdings Ltd.		42,900		2,434,575
				5,534,712
Materials 7.0%
A. Schulman, Inc.		70,000		1,817,900
AMCOL International Corp.		28,400		873,868
Axiall Corp.		19,500		1,022,775
Balchem Corp.		8,700		377,058
Berry Plastics Group, Inc. *		17,800		338,200
Chemtura Corp. *		48,100		1,022,606
Coeur d’Alene Mines Corp. *		118,700		1,808,988
Commercial Metals Co.		131,500		1,922,530
FutureFuel Corp.		52,300		640,675
Graphic Packaging Holding Co. *		196,100		1,474,672
H.B. Fuller Co.		17,400		659,460
Handy & Harman Ltd. *		8,300		127,654
Innospec, Inc.		14,700		646,947
Kraton Performance Polymers, Inc. *		24,800		563,208
Materion Corp.		53,500		1,417,215
Minerals Technologies, Inc.		93,300		3,790,779
Neenah Paper, Inc.		94,000		2,703,440
OM Group, Inc. *		56,400		1,380,108
Omnova Solutions, Inc. *		26,600		177,422
P.H. Glatfelter Co.		69,300		1,663,200
PolyOne Corp.		9,200		207,276
RTI International Metals, Inc. *		68,800		1,996,576
SunCoke Energy, Inc. *		118,300		1,789,879
Tredegar Corp.		53,500		1,583,600
Worthington Industries, Inc.		83,600		2,690,248
				32,696,284
Media 1.5%
AH Belo Corp., Class A		48,000		278,400
LIN TV Corp., Class A *		14,500		178,495
Lions Gate Entertainment Corp. *		14,000		347,340
Live Nation Entertainment, Inc. *		173,700		2,193,831
Nexstar Broadcasting Group, Inc., Class A		10,300		250,805
Scholastic Corp.		33,300		914,085
Sinclair Broadcast Group, Inc., Class A		42,800		1,147,040
The E.W. Scripps Co., Class A *		74,600		1,036,194
The New York Times Co., Class A *		90,600		802,716
				7,148,906
Pharmaceuticals, Biotechnology & Life Sciences 5.8%
Acorda Therapeutics, Inc. *		42,400		1,677,768
Albany Molecular Research, Inc. *		54,200		646,606
AMAG Pharmaceuticals, Inc. *		112,000		2,469,600
Bio-Rad Laboratories, Inc., Class A *		26,800		3,209,300
Cambrex Corp. *		96,800		1,209,032
Charles River Laboratories International, Inc. *		64,200		2,792,058
Cubist Pharmaceuticals, Inc. *		91,100		4,183,312
Emergent Biosolutions, Inc. *		48,600		745,524
Enzo Biochem, Inc. *		69,500		155,680
Enzon Pharmaceuticals, Inc.		293,200		967,560
Hi-Tech Pharmacal Co., Inc.		18,800		621,528
ICON plc *		16,700		536,404
Jazz Pharmaceuticals plc *		2,700		157,545
Lannett Co., Inc. *		46,500		539,865
Lexicon Pharmaceuticals, Inc. *		116,800		231,264
Maxygen, Inc.		67,800		162,720
Nektar Therapeutics *		29,800		323,032
Pain Therapeutics, Inc. *		34,400		141,728
PAREXEL International Corp. *		104,500		4,279,275
PDL Biopharma, Inc. (a)		210,900		1,632,366
Repligen Corp. *		43,600		390,656
				27,072,823
Real Estate 8.9%
Acadia Realty Trust		69,100		1,972,805
Agree Realty Corp.		15,400		463,078
Apartment Investment & Management Co., Class A		106,100		3,300,771
CapLease, Inc.		232,700		1,633,554
CBL & Associates Properties, Inc.		117,100		2,826,794
Coresite Realty Corp.		105,900		3,831,462
Cousins Properties, Inc.		324,900		3,547,908
DCT Industrial Trust, Inc.		500,000		3,915,000
Extra Space Storage, Inc.		54,800		2,388,184
First Industrial Realty Trust, Inc.		227,000		4,072,380
Investors Real Estate Trust		50,300		489,419
Kite Realty Group Trust		181,500		1,197,900
Lexington Realty Trust		163,500		2,094,435
Pennsylvania Real Estate Investment Trust		79,600		1,650,108
RAIT Financial Trust		41,300		352,702
RLJ Lodging Trust		185,600		4,276,224
Saul Centers, Inc.		30,900		1,384,320
Strategic Hotels & Resorts, Inc. *		255,300		2,060,271
				41,457,315
Retailing 4.4%
1-800-FLOWERS.COM, Inc., Class A *		95,400		565,722
ANN, Inc. *		74,400		2,197,776
Big 5 Sporting Goods Corp.		18,100		304,080
Brown Shoe Co., Inc.		219,200		3,706,672
Christopher & Banks Corp. *		20,200		140,390
Haverty Furniture Cos, Inc.		62,900		1,495,762

42 See financial notes

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Kirkland’s, Inc. *		81,700		985,302
New York & Co., Inc. *		82,500		367,950
Orbitz Worldwide, Inc. *		66,600		398,268
Rent-A-Center, Inc.		87,800		3,066,854
rue21, Inc. *		20,800		663,520
The Children’s Place Retail Stores, Inc. *		80,100		3,918,492
The Men’s Wearhouse, Inc.		47,200		1,581,200
Tuesday Morning Corp. *		24,200		196,262
Zale Corp. *		245,200		1,088,688
				20,676,938
Semiconductors & Semiconductor Equipment 3.6%
ATMI, Inc. *		18,200		395,850
Axcelis Technologies, Inc. *		92,700		120,510
AXT, Inc. *		49,700		142,639
Cohu, Inc.		22,200		212,454
DSP Group, Inc. *		26,000		209,820
Entegris, Inc. *		251,300		2,382,324
Exar Corp. *		151,100		1,628,858
First Solar, Inc. *		52,700		2,453,712
FormFactor, Inc. *		246,600		1,220,670
GSI Technology, Inc. *		15,100		94,224
IXYS Corp.		58,200		527,292
MEMC Electronic Materials, Inc. *		85,300		460,620
Microsemi Corp. *		20,400		424,320
Pericom Semiconductor Corp. *		51,100		330,106
Photronics, Inc. *		264,500		2,086,905
Rudolph Technologies, Inc. *		57,700		673,359
Sigma Designs, Inc. *		69,100		328,916
Spansion, Inc., Class A *		196,400		2,551,236
Ultra Clean Holdings, Inc. *		64,000		400,640
				16,644,455
Software & Services 10.0%
Accelrys, Inc. *		284,400		2,801,340
Acxiom Corp. *		196,400		3,906,396
Aspen Technology, Inc. *		46,500		1,417,320
Bottomline Technologies, Inc. *		18,500		484,700
Computer Task Group, Inc.		7,800		160,056
comScore, Inc. *		66,100		1,068,837
Convergys Corp.		168,800		2,872,976
CoreLogic, Inc. *		76,400		2,084,192
CSG Systems International, Inc. *		112,800		2,437,608
Dealertrack Technologies, Inc. *		4,700		130,895
Ebix, Inc. (a)		26,200		487,582
EPIQ Systems, Inc.		89,400		1,248,918
Euronet Worldwide, Inc. *		92,200		2,814,866
Guidance Software, Inc. *		17,200		180,944
IntraLinks Holdings, Inc. *		76,100		435,292
j2 Global, Inc.		73,900		3,007,730
Limelight Networks, Inc. *		349,100		673,763
Lionbridge Technologies, Inc. *		200,400		685,368
Mentor Graphics Corp.		200,400		3,659,304
MoneyGram International, Inc. *		48,524		801,131
Monotype Imaging Holdings, Inc.		92,300		2,140,437
NetScout Systems, Inc. *		16,900		385,489
Rosetta Stone, Inc. *		17,600		297,968
Rovi Corp. *		125,300		2,930,767
SeaChange International, Inc. *		96,800		1,051,248
Sykes Enterprises, Inc. *		30,300		466,317
TeleTech Holdings, Inc. *		80,200		1,707,458
TiVo, Inc. *		118,600		1,389,992
Unisys Corp. *		13,640		260,933
United Online, Inc.		534,800		3,636,640
Virtusa Corp. *		31,900		708,499
XO Group, Inc. *		25,100		282,626
				46,617,592
Technology Hardware & Equipment 5.8%
Aviat Networks, Inc. *		177,200		567,040
Avid Technology, Inc. *		55,300		364,427
Bel Fuse, Inc., Class B		7,700		113,344
Benchmark Electronics, Inc. *		84,400		1,505,696
Brocade Communications Systems, Inc. *		525,200		3,056,664
Checkpoint Systems, Inc. *		47,000		543,790
Ciena Corp. *		94,600		1,415,216
Daktronics, Inc.		52,700		526,473
EchoStar Corp., Class A *		7,300		286,671
Electro Scientific Industries, Inc.		13,200		142,296
Electronics for Imaging, Inc. *		60,600		1,619,232
Emulex Corp. *		267,100		1,602,600
Harmonic, Inc. *		603,100		3,425,608
Insight Enterprises, Inc. *		95,400		1,728,648
Ixia *		22,500		370,575
Lexmark International, Inc., Class A		50,800		1,539,748
Littelfuse, Inc.		6,500		453,830
Newport Corp. *		20,100		304,515
Plexus Corp. *		41,700		1,124,649
Radisys Corp. *		65,400		324,384
Richardson Electronics Ltd.		17,800		208,794
Sanmina Corp. *		103,400		1,304,908
Silicon Graphics International Corp. *		150,000		1,950,000
Symmetricom, Inc. *		64,700		336,440
Synaptics, Inc. *		4,000		164,920
Tech Data Corp. *		35,600		1,663,588
TTM Technologies, Inc. *		22,600		163,398
Zygo Corp. *		14,400		215,424
				27,022,878
Telecommunication Services 0.7%
Cbeyond, Inc. *		78,600		690,108
IDT Corp., Class B		60,900		900,711
Premiere Global Services, Inc. *		149,200		1,675,516
Shenandoah Telecommunications Co.		8,300		136,037
				3,402,372
Transportation 2.2%
AMERCO		18,700		3,005,090
Arkansas Best Corp.		55,300		581,203
Avis Budget Group, Inc. *		67,700		1,952,468
Park-Ohio Holdings Corp. *		28,200		1,037,196
Republic Airways Holdings, Inc. *		52,900		591,951
Saia, Inc. *		23,800		973,896
SkyWest, Inc.		138,600		1,983,366
Swift Transportation Co. *		17,200		241,144
				10,366,314

See financial notes 43

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Utilities 1.9%
American States Water Co.		57,400		3,184,552
Black Hills Corp.		82,400		3,863,736
Chesapeake Utilities Corp.		10,700		570,952
MGE Energy, Inc.		21,500		1,200,775
				8,820,015
Total Common Stock
(Cost $388,633,632)				463,925,665
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.8% of net assets
Time Deposits 0.8%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		3,720,973		3,720,973
U.S. Treasury Obligations 0.0%
U.S. Treasury Bills
0.00%, 06/20/13 (b)(c)		25,000		25,000
0.09%, 06/20/13 (b)(c)		66,000		65,992
0.63%, 06/20/13 (b)(c)		15,000		15,000
				105,992
Total Short-Term Investments
(Cost $3,826,965)				3,826,965
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.5% of net assets
Wells Fargo Advantage Government Money Market Fund		2,288,625		2,288,625
Total Collateral Invested for Securities on Loan
(Cost $2,288,625)				2,288,625
End of Collateral Invested for Securities on Loan

At 04/30/13, the tax basis cost of the fund’s investments was $392,988,767 and the unrealized appreciation and depreciation were $83,482,306 and ($8,718,443), respectively, with a net unrealized appreciation of $74,763,863.

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	All or a portion of this security is held as collateral for open futures contracts.
(c)	The rate shown is the purchase yield.

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
Russell 2000 Index, mini, Long, expires 06/21/13		20		1,890,200		84,825

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$463,925,665		$—		$—		$463,925,665
Short-Term Investments1		—		3,826,965		—		3,826,965
Total		$463,925,665		$3,826,965		$—		$467,752,630
Other Financial Instruments
Collateral Invested for Securities on Loan		$2,288,625		$—		$—		$2,288,625
Futures Contract2		84,825		—		—		84,825

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

44 See financial notes

 Schwab Small-Cap Equity Fund

Portfolio Holdings (Unaudited) continued

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock		$792,844		$—		($273,298	)		$—		($519,546	)		$—		$—		$—
Total		$792,844		$—		($273,298	)		$—		($519,546	)		$—		$—		$—

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 45

 Schwab Small-Cap Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $392,460,597) including securities on loan of $2,215,263		$467,752,630
Collateral invested for securities on loan		2,288,625
Receivables:
Investments sold		7,891,122
Fund shares sold		693,923
Dividends		181,539
Income from securities on loan		16,979
Due from broker for futures		11,400
Interest		3
Prepaid expenses	+	3,768
Total assets		478,839,989
Liabilities
Collateral held for securities on loan		2,288,625
Payables:
Investments bought		8,040,625
Investment adviser and administrator fees		31,220
Shareholder service fees		9,856
Fund shares redeemed		128,868
Accrued expenses	+	33,562
Total liabilities		10,532,756
Net Assets
Total assets		478,839,989
Total liabilities	−	10,532,756
Net assets		$468,307,233
Net Assets by Source
Capital received from investors		372,352,168
Net investment income not yet distributed		162,221
Net realized capital gains		20,295,093
Net unrealized capital gains		75,497,751
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$468,307,233		22,279,724			$21.02

46 See financial notes

 Schwab Small-Cap Equity Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends		$4,173,793
Interest		477
Securities on loan	+	86,559
Total investment income		4,260,829
Expenses
Investment adviser and administrator fees		1,715,123
Shareholder service fees		522,685
Portfolio accounting fees		23,812
Custodian fees		23,236
Shareholder reports		22,425
Professional fees		17,252
Registration fees		11,883
Transfer agent fees		11,530
Trustees’ fees		4,092
Other expenses	+	4,147
Total expenses		2,356,185
Expense reduction by CSIM and its affiliates	−	18,474
Net expenses	−	2,337,711
Net investment income		1,923,118
Realized and Unrealized Gains (Losses)
Net realized gains on investments		34,729,275
Net realized gains on futures contracts	+	234,066
Net realized gains		34,963,341
Net unrealized gains on investments		37,701,267
Net unrealized gains on futures contracts	+	84,825
Net unrealized gains	+	37,786,092
Net realized and unrealized gains		72,749,433
Increase in net assets resulting from operations		$74,672,551

See financial notes 47

 Schwab Small-Cap Equity Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$1,923,118			$412,291
Net realized gains		34,963,341			34,583,871
Net unrealized gains	+	37,786,092			23,055,659
Increase in net assets from operations		74,672,551			58,051,821
Distributions to Shareholders
Distributions from net investment income		($2,100,800	)		($177,045	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			2,186,236		$42,903,773			10,994,013		$164,489,009
Shares reinvested			39,481		707,097			3,977		61,875
Shares redeemed	+		(1,822,351	)	(35,439,631	)		(3,628,709	)	(61,262,349	)
Net transactions in fund shares			403,366		$8,171,239			7,369,281		$103,288,535
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			21,876,358		$387,564,243			14,507,077		$226,400,932
Total increase	+		403,366		80,742,990			7,369,281		161,163,311
End of period			22,279,724		$468,307,233			21,876,358		$387,564,243
Net investment income not yet distributed					$162,221					$339,903

48 See financial notes

Schwab Hedged Equity Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		16.36			15.32			14.79			13.45			12.55			16.39
Income (loss) from investment operations:
Net investment income (loss)		(0.05	)		(0.08	)		(0.05	)		(0.08	)		(0.05	)		(0.05	)
Net realized and unrealized gains (losses)		1.42			1.12			0.58			1.42			0.96			(3.63	)
Total from investment operations		1.37			1.04			0.53			1.34			0.91			(3.68	)
Less distributions:
Distributions from net investment income		—			—			—			—			(0.01	)		(0.16	)
Total distributions		—			—			—			—			(0.01	)		(0.16	)
Net asset value at end of period		17.73			16.36			15.32			14.79			13.45			12.55
Total return (%)		8.37	2		6.79			3.58			9.96			7.28			(22.66	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses (including dividend expense on short sales)		2.80	3		2.08			1.86			1.97			2.07	4		2.17	5
Net operating expenses (excluding dividend expense on short sales)		1.49	3,6		1.53	6		1.44	7		1.38	8		1.62	4,8		1.77
Gross operating expenses		2.85	3		2.13			1.88			1.99			2.29			2.19
Net investment income (loss)		(0.55	)3		(0.47	)		(0.25	)		(0.54	)		(0.41	)		(0.17	)
Portfolio turnover rate		72	2		109			98			115			169			138
Net assets, end of period ($ x 1,000,000)		196			194			236			329			306			343

* Unaudited.

¹ Effective September 28, 2009, the Investor Shares class and the Select Shares class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Select Shares.

² Not annualized.

³ Annualized.

⁴ Effective May 5, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁵ The ratio of net operating expenses would have been 2.16%, if interest expense had not been incurred.

⁶ The ratio of net operating expenses would have been 1.33% for the period ended 10/31/12 and 04/30/13, respectively, if stock loan fees on short sales had not been incurred.

⁷ The ratio of net operating expenses would have been 1.33% for the period ended 10/31/11, if stock loan fees on short sales and payment for state filing fees had not been included.

⁸ The ratio of net operating expenses would have been 1.47% and 1.31% for the period ended 10/31/09, and 10/31/10, respectively, if stock loan fees on short sales had not been incurred.

See financial notes 49

 Schwab Hedged Equity Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost			Value
Holdings by Category				($)			($)
	99	.0%	Common Stock		157,284,906			194,031,762
	1	.0%	Other Investment Company		1,951,757			1,951,757
	0	.1%	Short-Term Investments		119,994			119,994
	100	.1%	Total Investments		159,356,657			196,103,513
	(40	.7)%	Short Sales		(73,914,060	)		(79,842,271	)
	40	.6%	Other Assets and Liabilities, Net					79,702,315
	100	.0%	Total Net Assets					195,963,557

	Number		Value
Security	of Shares		($)
Common Stock 99.0% of net assets
Banks 5.8%
Fifth Third Bancorp (c)		78,998		1,345,336
KeyCorp (c)		18,900		188,433
Northwest Bancshares, Inc.		59,500		728,875
Ocwen Financial Corp. *		8,100		296,298
Regions Financial Corp. (c)		239,500		2,033,355
SunTrust Banks, Inc.		51,134		1,495,670
Wells Fargo & Co. (c)		118,191		4,488,894
Zions Bancorp		35,000		861,700
				11,438,561
Capital Goods 6.5%
3M Co.		10,200		1,068,042
AGCO Corp.		34,373		1,830,362
Curtiss-Wright Corp.		43,600		1,431,824
GATX Corp.		33,300		1,696,635
General Electric Co. (c)		31,485		701,801
Northrop Grumman Corp.		14,700		1,113,378
Roper Industries, Inc.		6,500		777,725
Textron, Inc.		32,235		830,051
The Manitowoc Co., Inc.		34,200		641,592
Wabtec Corp. (c)		25,200		2,644,488
				12,735,898
Commercial & Professional Supplies 0.5%
Equifax, Inc.		13,800		844,560
The Brink’s Co.		1,000		26,510
UniFirst Corp.		400		36,420
				907,490
Consumer Durables & Apparel 3.5%
Fossil, Inc. *		22,600		2,217,512
Hanesbrands, Inc. *		16,400		822,624
Jarden Corp. (c)*		35,416		1,594,074
Mohawk Industries, Inc. (c)*		20,620		2,286,346
				6,920,556
Consumer Services 1.7%
Brinker International, Inc. (c)		33,926		1,319,721
Cracker Barrel Old Country Store, Inc.		5,300		438,522
Jack in the Box, Inc. *		23,600		846,060
Service Corp. International		43,200		729,216
				3,333,519
Diversified Financials 7.6%
Affiliated Managers Group, Inc. *		8,000		1,245,440
Bank of America Corp. (c)		118,400		1,457,504
JPMorgan Chase & Co. (c)		93,012		4,558,518
Northern Trust Corp.		11,700		630,864
SLM Corp. (c)		142,109		2,934,551
State Street Corp.		13,600		795,192
The Bank of New York Mellon Corp.		66,100		1,865,342
The Goldman Sachs Group, Inc.		9,800		1,431,486
				14,918,897
Energy 9.8%
Chevron Corp. (c)		32,596		3,977,038
ConocoPhillips		44,500		2,690,025
EOG Resources, Inc. (c)		21,300		2,580,708
Exxon Mobil Corp. (c)		22,178		1,973,620
Marathon Oil Corp. (c)		92,000		3,005,640
Murphy Oil Corp. (c)		40,553		2,517,936
Oceaneering International, Inc. (c)		24,501		1,719,235
Valero Energy Corp. (c)		20,378		821,641
				19,285,843
Food & Staples Retailing 3.0%
Costco Wholesale Corp.		13,500		1,463,805
Rite Aid Corp. *		30,500		80,825
Safeway, Inc.		65,600		1,477,312
The Kroger Co. (c)		84,543		2,906,588
				5,928,530
Food, Beverage & Tobacco 6.3%
Bunge Ltd. (c)		27,244		1,967,289
Ingredion, Inc. (c)		41,149		2,963,140
J&J Snack Foods Corp.		6,100		457,622
Kellogg Co.		24,700		1,606,488
PepsiCo, Inc.		15,519		1,279,852
Universal Corp. (c)		69,100		3,976,705
				12,251,096
Health Care Equipment & Services 3.7%
Alere, Inc. *		49,200		1,263,456
Baxter International, Inc.		1,000		69,870
Cigna Corp.		15,400		1,019,018

50 See financial notes

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Magellan Health Services, Inc. *		43,300		2,215,228
Medtronic, Inc.		54,000		2,520,720
UnitedHealth Group, Inc.		3,800		227,734
				7,316,026
Insurance 3.6%
Aflac, Inc.		36,700		1,997,948
American Financial Group, Inc. (c)		30,000		1,448,100
Principal Financial Group, Inc.		39,132		1,412,665
Prudential Financial, Inc.		14,700		888,174
Reinsurance Group of America, Inc.		8,300		519,165
The Travelers Cos., Inc.		9,900		845,559
				7,111,611
Materials 5.9%
AMCOL International Corp.		20,400		627,708
Coeur d’Alene Mines Corp. *		32,900		501,396
Commercial Metals Co.		61,300		896,206
International Paper Co. (c)		65,416		3,073,244
MeadWestvaco Corp. (c)		40,247		1,387,716
Minerals Technologies, Inc. (c)		70,592		2,868,153
PPG Industries, Inc.		4,472		658,010
Steel Dynamics, Inc.		30,700		461,728
Worthington Industries, Inc.		35,300		1,135,954
				11,610,115
Media 1.7%
Comcast Corp., Class A		31,700		1,309,210
Lamar Advertising Co., Class A *		1,100		51,502
Live Nation Entertainment, Inc. *		32,700		413,001
Time Warner, Inc.		24,800		1,482,544
				3,256,257
Pharmaceuticals, Biotechnology & Life Sciences 8.1%
Amgen, Inc.		19,700		2,052,937
Celgene Corp. *		24,000		2,833,680
Charles River Laboratories International, Inc. (c)*		45,000		1,957,050
Merck & Co., Inc. (c)		69,800		3,280,600
Pfizer, Inc. (c)		199,387		5,796,180
				15,920,447
Real Estate 1.2%
Apartment Investment & Management Co., Class A		11,700		363,987
First Industrial Realty Trust, Inc.		43,000		771,420
Strategic Hotels & Resorts, Inc. (c)*		154,700		1,248,429
				2,383,836
Retailing 5.9%
Abercrombie & Fitch Co., Class A (c)		73,200		3,627,792
ANN, Inc. *		17,900		528,766
Best Buy Co., Inc.		14,900		387,251
Foot Locker, Inc. (c)		69,789		2,433,542
Macy’s, Inc. (c)		65,421		2,917,777
Rent-A-Center, Inc.		18,200		635,726
The Children’s Place Retail Stores, Inc. *		8,900		435,388
The TJX Cos., Inc.		10,500		512,085
				11,478,327
Semiconductors & Semiconductor Equipment 0.7%
First Solar, Inc. *		7,600		353,856
LSI Corp. (c)*		83,966		549,138
NVIDIA Corp.		27,200		374,544
				1,277,538
Software & Services 10.6%
Accenture plc, Class A		27,800		2,264,032
Aspen Technology, Inc. *		22,500		685,800
CA, Inc. (c)		91,406		2,465,220
Cadence Design Systems, Inc. (c)*		137,800		1,901,640
Convergys Corp. (c)		100,622		1,712,586
Google, Inc., Class A *		1,400		1,154,398
Jack Henry & Associates, Inc.		26,200		1,215,680
Microsoft Corp.		23,900		791,090
Oracle Corp. (c)		84,300		2,763,354
Rovi Corp. *		37,300		872,447
Symantec Corp. (c)*		167,425		4,068,428
Synopsys, Inc. *		23,000		818,110
				20,712,785
Technology Hardware & Equipment 5.7%
Apple, Inc. (c)		9,728		4,307,072
Brocade Communications Systems, Inc. (c)*		349,224		2,032,484
Cisco Systems, Inc.		64,900		1,357,708
EchoStar Corp., Class A (c)*		21,567		846,936
Tech Data Corp. (c)*		34,245		1,600,269
Western Digital Corp.		17,379		960,711
				11,105,180
Telecommunication Services 1.3%
AT&T, Inc.		46,100		1,726,906
Telephone & Data Systems, Inc. (c)		37,020		830,729
				2,557,635
Transportation 2.8%
AMERCO		7,400		1,189,180
Delta Air Lines, Inc. (c)*		64,000		1,096,960
FedEx Corp. (c)		27,592		2,593,924
Hertz Global Holdings, Inc. *		25,500		614,040
				5,494,104
Utilities 3.1%
Ameren Corp. (c)		77,366		2,804,517
American Electric Power Co., Inc.		23,200		1,193,176
CenterPoint Energy, Inc.		49,000		1,209,320

See financial notes 51

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
The AES Corp. (c)		63,528		880,498
				6,087,511
Total Common Stock
(Cost $157,284,906)				194,031,762
Other Investment Company 1.0% of net assets
Money Market Fund 1.0%
State Street Institutional U.S. Government Money Market Fund		1,951,757		1,951,757
Total Other Investment Company
(Cost $1,951,757)				1,951,757
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.1% of net assets
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.03%, 06/20/13 (a)(b)		50,000		49,998
0.04%, 06/20/13 (a)(b)		70,000		69,996
Total Short-Term Investments
(Cost $119,994)				119,994
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $159,407,089 and the unrealized appreciation and depreciation were $37,799,961 and ($1,103,537), respectively, with a net unrealized appreciation of $36,696,424.

*	Non-income producing security.
(a)	All or a portion of this security is held as collateral for open futures contracts.
(b)	The rate shown is the purchase yield.
(c)	All or a portion of this security is held as collateral for short sales

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		25		1,990,250		37,919

52 See financial notes

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Short Sales 40.7% of net assets
Automobiles & Components 1.5%
American Axle & Manufacturing Holdings, Inc. *		5,200		69,524
Dorman Products, Inc.		45,200		1,705,848
Gentex Corp.		24,700		555,750
Johnson Controls, Inc.		19,300		675,693
				3,006,815
Banks 4.0%
Bank of Hawaii Corp.		27,500		1,311,475
Bank of the Ozarks, Inc.		32,800		1,342,504
BankUnited, Inc.		46,800		1,186,380
First Niagara Financial Group, Inc.		102,100		970,971
Firstmerit Corp.		34,000		582,420
New York Community Bancorp, Inc.		77,400		1,048,770
Texas Capital Bancshares, Inc. *		11,500		479,090
Valley National Bancorp		103,835		933,477
				7,855,087
Capital Goods 3.2%
Colfax Corp. *		29,100		1,358,097
Fortune Brands Home & Security, Inc. *		8,100		294,759
Generac Holdings, Inc.		1,600		57,488
GrafTech International Ltd. *		49,500		355,410
Joy Global, Inc.		700		39,564
Owens Corning *		6,100		256,566
Proto Labs, Inc. *		28,200		1,440,456
Raven Industries, Inc.		30,300		1,016,565
Simpson Manufacturing Co., Inc.		8,000		229,920
TransDigm Group, Inc.		6,600		968,880
Watsco, Inc.		2,500		210,950
				6,228,655
Commercial & Professional Supplies 2.1%
Copart, Inc. *		28,985		1,021,721
Stericycle, Inc. *		12,800		1,386,496
The Advisory Board Co. *		14,400		707,760
Waste Connections, Inc.		24,800		941,160
				4,057,137
Consumer Durables & Apparel 1.0%
D.R. Horton, Inc.		35,200		918,016
M.D.C. Holdings, Inc.		5,000		188,000
Meritage Homes Corp. *		4,700		229,313
Standard Pacific Corp. *		62,400		564,720
				1,900,049
Consumer Services 0.2%
DeVry, Inc.		15,300		428,553
Diversified Financials 2.9%
Apollo Investment Corp.		154,200		1,358,502
CBOE Holdings, Inc.		7,200		270,216
CME Group, Inc.		22,000		1,338,920
TD Ameritrade Holding Corp.		36,500		726,715
Walter Investment Management Corp. *		58,900		1,976,684
				5,671,037
Energy 2.5%
Approach Resources, Inc. *		7,600		180,272
Bonanza Creek Energy, Inc. *		34,600		1,188,510
Cabot Oil & Gas Corp.		8,200		558,010
Cheniere Energy, Inc. *		13,100		373,088
FMC Technologies, Inc. *		6,400		347,520
Gulfport Energy Corp. *		7,600		396,644
Kodiak Oil & Gas Corp. *		98,484		771,130
PDC Energy, Inc. *		6,500		281,450
Range Resources Corp.		7,400		544,048
Southwestern Energy Co. *		9,400		351,748
				4,992,420
Food & Staples Retailing 0.7%
Sysco Corp.		23,900		833,154
The Fresh Market, Inc. *		12,000		491,160
				1,324,314
Food, Beverage & Tobacco 3.7%
B&G Foods, Inc.		33,600		1,036,896
Dean Foods Co. *		54,600		1,045,044
Flowers Foods, Inc.		13,800		454,572
Hormel Foods Corp.		31,100		1,283,497
Lorillard, Inc.		12,300		527,547
McCormick & Co., Inc. - Non Voting Shares		1,700		122,298
Reynolds American, Inc.		18,428		873,856
Snyders-Lance, Inc.		5,200		130,936
The Hain Celestial Group, Inc. *		28,100		1,833,525
				7,308,171
Health Care Equipment & Services 1.3%
Acadia Healthcare Co., Inc. *		17,306		546,004
DexCom, Inc. *		64,400		1,056,804
HeartWare International, Inc. *		8,800		855,360
				2,458,168
Insurance 3.1%
Cincinnati Financial Corp.		8,600		420,626
Erie Indemnity Co., Class A		4,100		326,237
Hilltop Holdings, Inc. *		100,400		1,344,356
Mercury General Corp.		32,900		1,503,859
RLI Corp.		16,900		1,214,265
The Progressive Corp.		52,400		1,325,196
				6,134,539
Materials 1.9%
Airgas, Inc.		13,100		1,266,115
Albemarle Corp.		14,200		869,750
Allied Nevada Gold Corp. *		13,600		145,520
Compass Minerals International, Inc.		3,400		294,236
Eagle Materials, Inc.		1,900		128,725
Southern Copper Corp.		28,885		962,737

See financial notes 53

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Walter Energy, Inc.		7,600		136,192
				3,803,275
Media 1.7%
DreamWorks Animation SKG, Inc., Class A *		49,200		948,576
Loral Space & Communications, Inc.		5,400		332,208
Pandora Media, Inc. *		141,709		1,974,006
				3,254,790
Pharmaceuticals, Biotechnology & Life Sciences 1.2%
Akorn, Inc. *		50,600		761,530
Endo Health Solutions, Inc. *		24,100		883,024
Mettler-Toledo International, Inc. *		3,400		710,464
				2,355,018
Real Estate 1.1%
Government Properties Income Trust		12,100		315,205
Rayonier, Inc.		20,400		1,212,168
Realty Income Corp.		10,900		555,573
				2,082,946
Retailing 1.2%
AutoZone, Inc. *		2,600		1,063,634
CarMax, Inc. *		18,300		842,532
Lithia Motors, Inc., Class A		5,500		272,360
Mattress Firm Holding Corp. *		3,100		118,792
TripAdvisor, Inc. *		2,800		147,224
				2,444,542
Semiconductors & Semiconductor Equipment 1.2%
Cavium, Inc. *		10,200		320,790
Cirrus Logic, Inc. *		105,700		2,041,067
				2,361,857
Software & Services 2.9%
Booz Allen Hamilton Holding Corp.		4,500		68,355
Concur Technologies, Inc. *		15,800		1,155,138
CoStar Group, Inc. *		1,500		162,615
FactSet Research Systems, Inc.		2,800		263,396
Genpact Ltd.		38,300		712,380
Intuit, Inc.		7,700		459,228
LinkedIn Corp., Class A *		2,712		520,948
Liquidity Services, Inc. *		8,000		263,200
NetSuite, Inc. *		3,200		281,472
Paychex, Inc.		34,600		1,259,786
QLIK Technologies, Inc. *		16,100		418,761
ServiceSource International, Inc. *		18,400		117,760
				5,683,039
Technology Hardware & Equipment 2.2%
ADTRAN, Inc.		23,500		493,500
Anixter International, Inc.		11,100		796,314
F5 Networks, Inc. *		5,400		412,722
National Instruments Corp.		35,800		978,414
OSI Systems, Inc. *		11,200		641,760
ViaSat, Inc. *		21,400		1,037,258
				4,359,968
Transportation 1.1%
Allegiant Travel Co.		6,200		557,380
Kirby Corp. *		11,100		831,279
Norfolk Southern Corp.		9,600		743,232
				2,131,891
Total Short Sales
(Proceeds $73,914,060)				79,842,271
End of Short Sale Positions.

* Non-income producing security

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$194,031,762		$—		$—		$194,031,762
Other Investment Company1		1,951,757		—		—		1,951,757
Short-Term Investments1		—		119,994		—		119,994
Total		$195,983,519		$119,994		$—		$196,103,513
Other Financial Instruments
Futures Contracts2		$37,919		$—		$—		$37,919

54 See financial notes

 Schwab Hedged Equity Fund

Portfolio Holdings (Unaudited) continued

Liabilities Valuation Input
	Quoted Prices in					Significant
	Active Markets for			Significant Other		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Other Financial Instruments
Short Sales		($79,842,271	)		$—		$—		($79,842,271	)

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The funds’ policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1 and Level 2 for the period ended April 30, 2013.

See financial notes 55

 Schwab Hedged Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $159,356,657)		$196,103,513
Deposits with broker for short sales		79,214,497
Receivables:
Investments sold		3,891,700
Fund shares sold		461,633
Dividends		128,569
Due from broker for futures		5,000
Interest		23
Prepaid expenses	+	5,549
Total assets		279,810,484
Liabilities
Securities sold short, at value (proceeds $73,914,060)		79,842,271
Payables:
Investments bought		3,852,034
Investment adviser and administrator fees		16,446
Shareholder service fees		4,880
Fund shares redeemed		64,283
Dividends on short sales		19,944
Accrued expenses	+	47,069
Total liabilities		83,846,927
Net Assets
Total assets		279,810,484
Total liabilities	−	83,846,927
Net assets		$195,963,557
Net Assets by Source
Capital received from investors		159,303,702
Net investment loss		(1,438,683	)
Net realized capital gains		7,241,974
Net unrealized capital gains		30,856,564
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$195,963,557		11,051,796			$17.73

56 See financial notes

 Schwab Hedged Equity Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends		$2,178,209
Interest	+	274
Total investment income		2,178,483
Expenses
Investment adviser and administrator fees		1,019,658
Shareholder service fees		228,950
Dividends on short sales		1,271,403
Stock loan fees on short sales		153,296
Professional fees		24,716
Portfolio accounting fees		19,425
Transfer agent fees		17,168
Registration fees		10,863
Shareholder reports		8,036
Custodian fees		7,743
Trustees’ fees		3,541
Interest expense		802
Other expenses	+	2,761
Total expenses		2,768,362
Expense reduction by CSIM and its affiliates	−	51,295
Net expenses	−	2,717,067
Net investment loss		(538,584	)
Realized and Unrealized Gains (Losses)
Net realized gains on investments		13,480,347
Net realized gains on futures contracts		7,385
Net realized losses on short sales	+	(3,583,795	)
Net realized gains		9,903,937
Net unrealized gains on investments		13,530,439
Net unrealized gains on futures contracts		37,919
Net unrealized losses on short sales	+	(7,172,356	)
Net unrealized gains	+	6,396,002
Net realized and unrealized gains		16,299,939
Increase in net assets resulting from operations		$15,761,355

See financial notes 57

 Schwab Hedged Equity Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment loss		($538,584	)		($993,211	)
Net realized gains		9,903,937			15,666,186
Net unrealized gains (losses)	+	6,396,002			(705,355	)
Increase in net assets from operations		$15,761,355			$13,967,620

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,663,717		$28,343,438			2,083,203		$33,255,732
Shares redeemed	+		(2,492,648	)	(42,506,993	)		(5,584,279	)	(88,481,803	)
Net transactions in fund shares			(828,931	)	($14,163,555	)		(3,501,076	)	($55,226,071	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			11,880,727		$194,365,757			15,381,803		$235,624,208
Total increase or decrease	+		(828,931	)	1,597,800			(3,501,076	)	(41,258,451	)
End of period			11,051,796		$195,963,557			11,880,727		$194,365,757
Net investment loss					($1,438,683	)				($900,099	)

58 See financial notes

Schwab Financial Services Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		10.66			9.17			9.74			8.77			9.05			15.88
Income (loss) from investment operations:
Net investment income (loss)		0.08			0.08			0.05			0.04			0.08			0.18
Net realized and unrealized gains (losses)		1.87			1.46			(0.58	)		0.99			(0.21	)		(6.78	)
Total from investment operations		1.95			1.54			(0.53	)		1.03			(0.13	)		(6.60	)
Less distributions:
Distributions from net investment income		(0.09	)		(0.05	)		(0.04	)		(0.06	)		(0.15	)		(0.21	)
Distributions from net realized gains		—			—			—			—			—			(0.02	)
Total distributions		(0.09	)		(0.05	)		(0.04	)		(0.06	)		(0.15	)		(0.23	)
Net asset value at end of period		12.52			10.66			9.17			9.74			8.77			9.05
Total return (%)		18.47	1		16.92			(5.51	)		11.79			(1.10	)		(42.08	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.94	2		0.94			0.93	3		0.95	4		0.96	5		0.94
Gross operating expenses		1.05	2		1.10			1.06			1.04			0.99			0.94
Net investment income (loss)		1.41	2		0.78			0.45			0.37			0.91			1.56
Portfolio turnover rate		55	1		84			77			54			47			59
Net assets, end of period ($ x 1,000,000)		56			47			40			52			64			84

* Unaudited.

¹ Not annualized.

² Annualized.

³ The ratio of net operating expenses would have been 0.94%, if payment for state filing fees had not been included.

⁴ The ratio of net operating expenses would have been 0.94%, if certain non-routine expenses had not been incurred.

⁵ Effective July 1, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

See financial notes 59

 Schwab Financial Services Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.6%	Common Stock		44,416,883		54,613,893
	0	.9%	Short-Term Investments		522,577		522,577
	98	.5%	Total Investments		44,939,460		55,136,470
	1	.3%	Collateral Invested for Securities on Loan		744,625		744,625
	0	.2%	Other Assets and Liabilities, Net				83,091
	100	.0%	Total Net Assets				55,964,186

	Number		Value
Security	of Shares		($)
Common Stock 97.6% of net assets
Banks 18.1%
Bank Mutual Corp.		8,600		44,548
Berkshire Hills Bancorp, Inc.		5,100		131,886
Chemical Financial Corp.		11,500		285,200
First Defiance Financial Corp.		8,700		196,968
First Interstate BancSystem, Inc.		11,500		233,680
Huntington Bancshares, Inc.		69,000		494,730
Northwest Bancshares, Inc.		34,900		427,525
Ocwen Financial Corp. *		6,800		248,744
Regions Financial Corp.		82,500		700,425
SunTrust Banks, Inc.		4,400		128,700
U.S. Bancorp		16,700		555,776
United Community Banks, Inc. *		25,400		278,130
Wells Fargo & Co.		124,900		4,743,702
WSFS Financial Corp.		13,200		646,008
Zions Bancorp		41,600		1,024,192
				10,140,214
Diversified Financials 34.8%
Affiliated Managers Group, Inc. *		7,400		1,152,032
Bank of America Corp.		192,100		2,364,751
BlackRock, Inc.		3,100		826,150
Citigroup, Inc.		56,000		2,612,960
First Cash Financial Services, Inc. *		2,500		128,675
FXCM, Inc., Class A		10,700		144,985
Investment Technology Group, Inc. *		32,700		356,103
JPMorgan Chase & Co.		96,000		4,704,960
Morgan Stanley		46,400		1,027,760
SLM Corp.		37,100		766,115
State Street Corp.		27,300		1,596,231
The Bank of New York Mellon Corp.		55,900		1,577,498
The Goldman Sachs Group, Inc.		15,200		2,220,264
				19,478,484
Insurance 21.9%
Aflac, Inc.		26,600		1,448,104
American International Group, Inc. *		20,500		849,110
Berkshire Hathaway, Inc., Class B *		23,700		2,519,784
First American Financial Corp.		3,900		104,403
HCC Insurance Holdings, Inc.		24,200		1,030,920
Loews Corp.		24,100		1,076,547
MetLife, Inc.		5,500		214,445
Prudential Financial, Inc.		20,300		1,226,526
Reinsurance Group of America, Inc.		15,100		944,505
The Travelers Cos., Inc.		19,700		1,682,577
Torchmark Corp.		17,500		1,086,225
XL Group plc		2,200		68,508
				12,251,654
Real Estate 22.8%
Agree Realty Corp.		2,500		75,175
Apartment Investment & Management Co., Class A		33,700		1,048,407
CBL & Associates Properties, Inc.		900		21,726
CBRE Group, Inc., Class A *		34,100		825,902
Cousins Properties, Inc.		10,100		110,292
DDR Corp.		53,000		972,020
Duke Realty Corp.		46,900		827,316
Equity Lifestyle Properties, Inc.		11,900		966,875
Extra Space Storage, Inc.		5,100		222,258
First Industrial Realty Trust, Inc.		32,400		581,256
Liberty Property Trust		25,900		1,113,441
Prologis, Inc.		32,400		1,359,180
Retail Properties of America, Inc., Class A		11,100		169,941
RLJ Lodging Trust		30,300		698,112
Simon Property Group, Inc.		11,037		1,965,359
Strategic Hotels & Resorts, Inc. *		6,700		54,069
Weingarten Realty Investors		13,500		459,945
Weyerhaeuser Co.		41,700		1,272,267
				12,743,541
Total Common Stock
(Cost $44,416,883)				54,613,893
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.9% of net assets
Time Deposit 0.9%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		495,580		495,580

60 See financial notes

 Schwab Financial Services Fund

Portfolio Holdings (Unaudited) continued

	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
U.S. Treasury Obligation 0.0%
U.S. Treasury Bill
0.09%, 06/20/13 (a)(b)		27,000		26,997
Total Short-Term Investments
(Cost $522,577)				522,577
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 1.3% of net assets
Wells Fargo Advantage Government Money Market Fund (c)		744,625		744,625
Total Collateral Invested for Securities on Loan
(Cost $744,625)				744,625
End of Collateral Invested for Securities on Loan

At 04/30/13, the tax basis cost of the fund’s investments was $44,950,510 and the unrealized appreciation and depreciation were $10,231,164 and ($45,204), respectively, with a net unrealized appreciation of $10,185,960.

*	Non-income producing security.
(a)	All or a portion of this security is held as collateral for open futures contracts.
(b)	The rate shown is the purchase yield.
(c)	Collateral amounts relate to shares on loan of National Retail Properties, Inc., which was sold off as of period end and not yet settled.

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		10		796,100		15,208

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$54,613,893		$—		$—		$54,613,893
Short-Term Investments1		—		522,577		—		522,577
Total		$54,613,893		$522,577		$—		$55,136,470
Other Financial Instruments
Collateral Invested for Securities on Loan		$744,625		$—		$—		$744,625
Futures Contracts2		15,208		—		—		15,208

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 61

 Schwab Financial Services Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $44,939,460)		$55,136,470
Collateral invested for securities on loan		744,625
Receivables:
Investments sold		4,771,525
Fund shares sold		96,540
Dividends		30,867
Due from broker for futures		2,604
Income from securities on loan		141
Prepaid expenses	+	1,051
Total assets		60,783,823
Liabilities
Collateral held for securities on loan		744,625
Payables:
Investments bought		3,985,446
Investment adviser and administrator fees		2,206
Shareholder service fees		2,444
Fund shares redeemed		65,725
Accrued expenses	+	19,191
Total liabilities		4,819,637
Net Assets
Total assets		60,783,823
Total liabilities	−	4,819,637
Net assets		$55,964,186
Net Assets by Source
Capital received from investors		79,087,822
Net investment income not yet distributed		176,060
Net realized capital losses		(33,529,030	)
Net unrealized capital gains		10,229,334
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$55,964,186		4,471,124			$12.52

62 See financial notes

 Schwab Financial Services Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends		$600,796
Interest		176
Securities on loan	+	150
Total investment income		601,122
Expenses
Investment adviser and administrator fees		138,167
Shareholder service fees		61,543
Portfolio accounting fees		18,175
Transfer agent fees		15,674
Professional fees		14,282
Registration fees		8,016
Shareholder reports		6,177
Trustees’ fees		3,018
Custodian fees		2,478
Other expenses	+	743
Total expenses		268,273
Expense reduction by CSIM and its affiliates	−	27,760
Net expenses	−	240,513
Net investment income		360,609
Realized and Unrealized Gains (Losses)
Net realized gains on investments		2,218,140
Net realized gains on futures contracts	+	42,624
Net realized gains		2,260,764
Net unrealized gains on investments		6,059,203
Net unrealized gains on futures contracts	+	35,376
Net unrealized gains	+	6,094,579
Net realized and unrealized gains		8,355,343
Increase in net assets resulting from operations		$8,715,952

See financial notes 63

 Schwab Financial Services Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$360,609			$341,423
Net realized gains		2,260,764			1,502,885
Net unrealized gains	+	6,094,579			4,694,094
Increase in net assets from operations		8,715,952			6,538,402
Distributions to Shareholders
Distributions from net investment income		($406,901	)		($224,748	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			734,321		$8,423,314			1,195,666		$12,102,193
Shares reinvested			33,206		353,309			21,793		196,795
Shares redeemed	+		(677,696	)	(7,815,525	)		(1,227,292	)	(12,174,120	)
Net transactions in fund shares			89,831		$961,098			(9,833	)	$124,868
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			4,381,293		$46,694,037			4,391,126		$40,255,515
Total increase or decrease	+		89,831		9,270,149			(9,833	)	6,438,522
End of period			4,471,124		$55,964,186			4,381,293		$46,694,037
Net investment income not yet distributed					$176,060					$222,352

64 See financial notes

Schwab Health Care Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		20.59			17.29			15.48			13.41			12.55			17.08
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.27			0.15			0.19			0.13			0.08
Net realized and unrealized gains (losses)		3.70			3.18			1.85			2.01			0.82			(4.46	)
Total from investment operations		3.84			3.45			2.00			2.20			0.95			(4.38	)
Less distributions:
Distributions from net investment income		(0.33	)		(0.15	)		(0.19	)		(0.13	)		(0.09	)		(0.05	)
Distributions from net realized gains		(2.17	)		—			—			—			—			(0.10	)
Total distributions		(2.50	)		(0.15	)		(0.19	)		(0.13	)		(0.09	)		(0.15	)
Net asset value at end of period		21.93			20.59			17.29			15.48			13.41			12.55
Total return (%)		20.91	1		20.10			13.00			16.49			7.65			(25.87	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.82	2		0.82			0.81	3		0.82			0.83	4		0.82
Gross operating expenses		0.83	2		0.85			0.85			0.86			0.85			0.82
Net investment income (loss)		1.37	2		1.44			0.85			1.14			0.88			0.48
Portfolio turnover rate		21	1		60			24			37			36			50
Net assets, end of period ($ x 1,000,000)		681			511			414			410			430			545

* Unaudited.

¹ Not annualized.

² Annualized.

³ The ratio of net operating expenses would have been 0.82%, if payment for state filing fees and a voluntary reduction of Investment Adviser fees had not been included.

⁴ Effective July 1, 2009, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

See financial notes 65

 Schwab Health Care Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	76	.1%	Common Stock		401,697,259		518,638,980
	20	.6%	Foreign Common Stock		96,717,589		140,436,854
	2	.5%	Short-Term Investments		16,996,335		16,996,335
	99	.2%	Total Investments		515,411,183		676,072,169
	0	.8%	Other Assets and Liabilities, Net				5,115,442
	100	.0%	Total Net Assets				681,187,611

	Number		Value
Security	of Shares		($)
Common Stock 76.1% of net assets
Health Care Equipment & Services 27.0%
Abbott Laboratories		303,000		11,186,760
Alere, Inc. *		162,000		4,160,160
Allscripts Healthcare Solutions, Inc. *		100,000		1,384,000
AMN Healthcare Services, Inc. *		60,000		823,800
AmSurg Corp. *		86,000		2,886,160
Baxter International, Inc.		250,000		17,467,500
Becton, Dickinson & Co.		50,000		4,715,000
Boston Scientific Corp. *		1,594,000		11,939,060
Cantel Medical Corp.		13,000		410,930
Capital Senior Living Corp. *		35,000		849,100
Chemed Corp.		12,000		979,440
Cigna Corp.		126,000		8,337,420
Community Health Systems, Inc.		31,000		1,412,670
CONMED Corp.		80,000		2,506,400
Covidien plc		161,000		10,278,240
Cynosure, Inc., Class A *		27,000		698,220
Emeritus Corp. *		30,000		771,000
Five Star Quality Care, Inc. *		78,000		368,940
Gentiva Health Services, Inc. *		80,000		839,200
Greatbatch, Inc. *		60,000		1,676,400
Haemonetics Corp. *		30,000		1,155,000
Health Management Associates, Inc., Class A *		75,000		861,750
Hill-Rom Holdings, Inc.		167,000		5,689,690
Hologic, Inc. *		70,000		1,425,900
Humana, Inc.		30,000		2,223,300
ICU Medical, Inc. *		31,000		1,867,750
Integra LifeSciences Holdings Corp. *		30,000		1,050,900
Invacare Corp.		78,000		1,049,100
Kindred Healthcare, Inc. *		85,000		891,650
LifePoint Hospitals, Inc. *		30,000		1,440,000
Magellan Health Services, Inc. *		62,000		3,171,920
MedAssets, Inc. *		224,000		4,195,520
Medtronic, Inc.		554,000		25,860,720
NuVasive, Inc. *		53,000		1,111,410
Omnicare, Inc.		50,000		2,188,500
Omnicell, Inc. *		50,000		901,000
PharMerica Corp. *		60,000		773,400
RTI Biologics, Inc. *		81,000		322,380
STERIS Corp.		111,000		4,616,490
Stryker Corp.		25,000		1,639,500
SurModics, Inc. *		32,000		846,400
Symmetry Medical, Inc. *		100,000		1,192,000
Teleflex, Inc.		25,000		1,953,250
UnitedHealth Group, Inc.		336,000		20,136,480
Vanguard Health Systems, Inc. *		137,000		2,004,310
Wright Medical Group, Inc. *		100,000		2,344,000
Zimmer Holdings, Inc.		128,000		9,785,600
				184,388,320
Pharmaceuticals, Biotechnology & Life Sciences 49.1%
AbbVie, Inc.		439,000		20,215,950
Acorda Therapeutics, Inc. *		72,000		2,849,040
Allergan, Inc.		83,000		9,424,650
AMAG Pharmaceuticals, Inc. *		95,000		2,094,750
Amgen, Inc.		225,000		23,447,250
Astex Pharmaceuticals *		108,000		743,040
Bio-Rad Laboratories, Inc., Class A *		37,000		4,430,750
Biogen Idec, Inc. *		60,000		13,135,800
Bristol-Myers Squibb Co.		198,000		7,864,560
Bruker Corp. *		85,000		1,510,450
Cambrex Corp. *		35,000		437,150
Celgene Corp. *		200,000		23,614,000
Charles River Laboratories International, Inc. *		130,000		5,653,700
Cubist Pharmaceuticals, Inc. *		207,000		9,505,440
Eli Lilly & Co.		454,000		25,142,520
Emergent Biosolutions, Inc. *		30,000		460,200
Gilead Sciences, Inc. *		220,000		11,140,800
ICON plc *		29,000		931,480
Johnson & Johnson		530,000		45,171,900
Lannett Co., Inc. *		37,000		429,570
Lexicon Pharmaceuticals, Inc. *		71,000		140,580
Merck & Co., Inc.		735,000		34,545,000
Mylan, Inc. *		471,000		13,710,810
PAREXEL International Corp. *		110,000		4,504,500
Pfizer, Inc.		1,509,000		43,866,630
Thermo Fisher Scientific, Inc.		241,000		19,443,880
United Therapeutics Corp. *		87,000		5,809,860
Warner Chilcott plc, Class A		280,000		4,026,400
				334,250,660
Total Common Stock
(Cost $401,697,259)				518,638,980
Foreign Common Stock 20.6% of net assets
Australia 1.4%
Health Care Equipment & Services 0.1%
Primary Health Care Ltd.		100,000		546,532

66 See financial notes

 Schwab Health Care Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Pharmaceuticals, Biotechnology & Life Sciences 1.3%
CSL Ltd.		140,000		9,149,404
				9,695,936
Denmark 1.8%
Health Care Equipment & Services 0.2%
Coloplast A/S, Class B		10,000		544,064
GN Store Nord A/S		60,000		1,097,358
				1,641,422
Pharmaceuticals, Biotechnology & Life Sciences 1.6%
Novo Nordisk A/S, Class B		60,000		10,561,481
				12,202,903
France 2.8%
Pharmaceuticals, Biotechnology & Life Sciences 2.8%
Sanofi		174,000		18,812,102
Germany 0.7%
Pharmaceuticals, Biotechnology & Life Sciences 0.7%
Bayer AG - Reg’d		26,000		2,718,208
Merck KGaA		15,000		2,285,200
				5,003,408
Israel 0.5%
Pharmaceuticals, Biotechnology & Life Sciences 0.5%
Teva Pharmaceutical Industries Ltd.		92,000		3,532,207
Japan 3.7%
Health Care Equipment & Services 0.2%
Sysmex Corp.		10,000		644,904
Terumo Corp.		15,000		745,207
				1,390,111
Pharmaceuticals, Biotechnology & Life Sciences 3.5%
Astellas Pharma, Inc.		100,000		5,828,505
Chugai Pharmaceutical Co., Ltd.		25,000		622,433
Dainippon Sumitomo Pharma Co., Ltd.		244,000		4,481,628
Eisai Co., Ltd.		50,000		2,281,707
Kyowa Hakko Kirin Co., Ltd.		404,000		4,958,884
Otsuka Holdings Co., Ltd.		45,000		1,622,803
Shionogi & Co., Ltd.		30,000		737,908
Takeda Pharmaceutical Co., Ltd.		60,000		3,294,105
				23,827,973
				25,218,084
Republic of Korea 0.1%
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Daewoong Pharmaceutical Co., Ltd.		6,000		401,159
South Africa 0.1%
Health Care Equipment & Services 0.1%
Mediclinic International Ltd.		100,000		724,912
Switzerland 7.2%
Pharmaceuticals, Biotechnology & Life Sciences 7.2%
Actelion Ltd. - Reg’d *		144,000		8,816,879
Novartis AG - Reg’d		310,000		22,948,547
Roche Holding AG		69,000		17,273,487
				49,038,913
United Kingdom 2.3%
Health Care Equipment & Services 0.1%
Smith & Nephew plc		80,000		915,728
Pharmaceuticals, Biotechnology & Life Sciences 2.2%
AstraZeneca plc		175,000		9,086,171
GlaxoSmithKline plc		225,000		5,805,331
				14,891,502
				15,807,230
Total Foreign Common Stock
(Cost $96,717,589)				140,436,854
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 2.5% of net assets
Time Deposits 2.3%
Citibank
Euro
(0.00)%, 05/01/13		72,623		72,623
DNB
USD
0.03%, 05/01/13		15,769,785		15,769,785
				15,842,408
U.S. Treasury Obligations 0.2%
U.S. Treasury Bills
0.01%, 06/20/13 (a)(b)		65,000		64,999
0.03%, 06/20/13 (a)(b)		500,000		499,979
0.04%, 06/20/13 (a)(b)		300,000		299,983
0.09%, 06/20/13 (a)(b)		289,000		288,966
				1,153,927
Total Short-Term Investments
(Cost $16,996,335)				16,996,335
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $515,411,183 and the unrealized appreciation and depreciation were $162,805,178 and ($2,144,192), respectively, with a net unrealized appreciation of $160,660,986.

See financial notes 67

 Schwab Health Care Fund

Portfolio Holdings (Unaudited) continued

At 04/30/13, the values of certain foreign securities held by the fund aggregating $139,167,878 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

*	Non-income producing security.
(a)	All or a portion of this security is held as collateral for open futures contracts.
(b)	The rate shown is the purchase yield.

Reg’d — Registered

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		175		13,931,750		256,382

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$518,638,980		$—		$—		$518,638,980
Foreign Common Stock1		724,912		—		—		724,912
Australia1		—		9,695,936		—		9,695,936
Denmark
Health Care Equipment & Services		544,064		1,097,358		—		1,641,422
Pharmaceuticals, Biotechnology & Life Sciences		—		10,561,481		—		10,561,481
France1		—		18,812,102		—		18,812,102
Germany1		—		5,003,408		—		5,003,408
Israel1		—		3,532,207		—		3,532,207
Japan1		—		25,218,084		—		25,218,084
Republic of Korea1		—		401,159		—		401,159
Switzerland1		—		49,038,913		—		49,038,913
United Kingdom1		—		15,807,230		—		15,807,230
Short-Term Investments1		—		16,996,335		—		16,996,335
Total		$519,907,956		$156,164,213		$—		$676,072,169
Other Financial Instruments
Futures Contract2		$256,382		$—		$—		$256,382

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

68 See financial notes

 Schwab Health Care Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $515,411,183)		$676,072,169
Foreign currency, at value (cost $14)		14
Receivables:
Investments sold		934,872
Fund shares sold		3,865,645
Dividends		465,461
Foreign tax reclaims		297,363
Due from broker for futures		35,000
Interest		13
Prepaid expenses	+	7,687
Total assets		681,678,224
Liabilities
Payables:
Investment adviser and administrator fees		30,455
Shareholder service fees		25,311
Fund shares redeemed		392,492
Accrued expenses	+	42,355
Total liabilities		490,613
Net Assets
Total assets		681,678,224
Total liabilities	−	490,613
Net assets		$681,187,611
Net Assets by Source
Capital received from investors		494,018,576
Net investment income not yet distributed		2,158,825
Net realized capital gains		24,096,213
Net unrealized capital gains		160,913,997
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$681,187,611		31,063,016			$21.93

See financial notes 69

 Schwab Health Care Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $260,858)		$6,212,623
Interest		2,502
Securities on loan	+	365
Total investment income		6,215,490
Expenses
Investment adviser and administrator fees		1,521,431
Shareholder service fees		687,061
Transfer agent fees		45,821
Shareholder reports		27,748
Portfolio accounting fees		27,659
Professional fees		15,749
Registration fees		14,841
Custodian fees		14,360
Trustees’ fees		4,470
Other expenses	+	5,705
Total expenses		2,364,845
Expense reduction by CSIM and its affiliates	−	45,821
Net expenses	−	2,319,024
Net investment income		3,896,466
Realized and Unrealized Gains (Losses)
Net realized gains on investments		23,686,877
Net realized gains on futures contracts		241,651
Net realized losses on foreign currency transactions	+	(66,604	)
Net realized gains		23,861,924
Net unrealized gains on investments		81,857,240
Net unrealized gains on futures contracts		492,432
Net unrealized gains on foreign currency translations	+	6,486
Net unrealized gains	+	82,356,158
Net realized and unrealized gains		106,218,082
Increase in net assets resulting from operations		$110,114,548

70 See financial notes

 Schwab Health Care Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$3,896,466			$6,550,477
Net realized gains		23,861,924			69,963,685
Net unrealized gains	+	82,356,158			6,352,277
Increase in net assets from operations		110,114,548			82,866,439
Distributions to Shareholders
Distributions from net investment income		(8,336,930	)		(3,529,101	)
Distributions from net realized gains	+	(54,300,003	)		—
Total distributions		($62,636,933	)		($3,529,101	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			5,858,656		$119,836,971			4,855,710		$92,832,540
Shares reinvested			3,014,800		55,894,398			178,373		3,114,387
Shares redeemed	+		(2,620,827	)	(52,937,101	)		(4,151,453	)	(78,160,304	)
Net transactions in fund shares			6,252,629		$122,794,268			882,630		$17,786,623
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			24,810,387		$510,915,728			23,927,757		$413,791,767
Total increase	+		6,252,629		170,271,883			882,630		97,123,961
End of period			31,063,016		$681,187,611			24,810,387		$510,915,728
Net investment income not yet distributed					$2,158,825					$6,599,289

See financial notes 71

Schwab^® International Core Equity Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			5/30/082–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		7.90			7.32			7.80			7.25			5.85			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.12			0.16			0.17			0.16			0.03			0.06
Net realized and unrealized gains (losses)		1.18			0.62			(0.46	)		0.57			1.46			(4.21	)
Total from investment operations		1.30			0.78			(0.29	)		0.73			1.49			(4.15	)
Less distributions:
Distributions from net investment income		(0.21	)		(0.20	)		(0.19	)		(0.18	)		(0.09	)		—
Net asset value at end of period		8.99			7.90			7.32			7.80			7.25			5.85
Total return (%)		16.90	3		11.17			(3.89	)		10.09			25.98			(41.50	)3
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.86	4		0.86			0.80	5		0.87	6		0.86			0.86	4
Gross operating expenses		1.10	4		1.16			1.22			1.27			1.60			1.39	4
Net investment income (loss)		2.76	4		2.45			2.32			1.85			1.19			1.67	4
Portfolio turnover rate		47	3		112			86			91	7		94			56	3
Net assets, end of period ($ x 1,000,000)		110			78			60			53			37			3

* Unaudited.

¹ Effective October 7, 2009, the Investor Shares class, the Select Shares class and the Institutional Shares class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Institutional Shares.

² Commencement of operations.

³ Not annualized.

⁴ Annualized.

⁵ The ratio of net operating expenses would have been 0.86%, if a voluntary reduction of Investment Adviser fees had not been included.

⁶ The ratio of net operating expenses would have been 0.86%, if certain non-routine expenses had not been incurred.

⁷ Portfolio turnover excludes the impact of investment activity resulting from a merger with another fund.

72 See financial notes

 Schwab International Core Equity Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	98	.5%	Common Stock		92,163,061		108,536,402
	1	.9%	Other Investment Companies		2,059,200		2,123,661
	100	.4%	Total Investments		94,222,261		110,660,063
	(0	.4)%	Other Assets and Liabilities, Net				(449,485	)
	100	.0%	Net Assets				110,210,578

	Number		Value
Security	of Shares		($)
Common Stock 98.5% of net assets
Australia 8.2%
Banks 0.9%
Westpac Banking Corp.		29,205		1,024,512
Capital Goods 0.2%
Seven Group Holdings Ltd.		18,391		177,346
Commercial & Professional Supplies 0.1%
Skilled Group Ltd.		33,211		98,216
Diversified Financials 2.1%
Challenger Ltd.		99,231		432,654
Macquarie Group Ltd.		31,942		1,299,455
Perpetual Ltd.		13,021		556,438
				2,288,547
Food & Staples Retailing 2.3%
Wesfarmers Ltd.		21,409		963,155
Woolworths Ltd.		40,549		1,531,505
				2,494,660
Health Care Equipment & Services 0.0%
Cochlear Ltd.		336		23,008
Materials 1.3%
BHP Billiton Ltd.		22,271		748,728
Incitec Pivot Ltd.		71,852		215,595
OZ Minerals Ltd.		16,483		73,880
Rio Tinto Ltd.		7,807		454,350
				1,492,553
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
CSL Ltd.		4,370		285,592
Retailing 1.0%
David Jones Ltd.		111,453		344,505
Myer Holdings Ltd		137,804		458,966
Pacific Brands Ltd.		403,210		359,831
				1,163,302
				9,047,736
Austria 0.6%
Banks 0.4%
Erste Group Bank AG *		4,445		139,323
Raiffeisen Bank International AG		7,687		271,256
				410,579
Transportation 0.2%
Oesterreichische Post AG		6,443		285,524
				696,103
Belgium 0.8%
Food, Beverage & Tobacco 0.3%
Anheuser-Busch InBev N.V.		3,743		359,592
Materials 0.1%
Solvay S.A.		380		55,699
Technology Hardware & Equipment 0.4%
Barco N.V.		5,324		474,077
				889,368
Brazil 0.1%
Real Estate 0.0%
Multiplan Empreendimentos Imobiliarios S.A.		1,100		31,338
Utilities 0.1%
Cia de Saneamento Basico do Estado de Sao Paulo		3,300		46,430
				77,768
Canada 0.4%
Consumer Durables & Apparel 0.2%
Gildan Activewear, Inc.		4,801		193,050
Energy 0.2%
Suncor Energy, Inc.		8,000		249,422
				442,472
Chile 0.1%
Utilities 0.1%
Enersis S.A.		343,112		129,238
Denmark 1.3%
Health Care Equipment & Services 0.1%
GN Store Nord A/S		6,115		111,839
Pharmaceuticals, Biotechnology & Life Sciences 1.2%
Novo Nordisk A/S, Class B		7,318		1,288,149
				1,399,988

See financial notes 73

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Finland 0.2%
Software & Services 0.1%
Tieto Oyj		6,154		131,988
Technology Hardware & Equipment 0.1%
Nokia Oyj		16,091		54,061
				186,049
France 8.8%
Automobiles & Components 1.5%
Compagnie Generale des Etablissements Michelin		8,885		751,333
Plastic Omnium S.A.		2,952		144,254
Renault S.A.		11,098		765,926
				1,661,513
Banks 1.7%
BNP Paribas S.A.		32,719		1,824,342
Credit Agricole S.A. *		5,444		49,871
				1,874,213
Capital Goods 1.4%
Legrand S.A.		4,200		196,008
Schneider Electric S.A.		5,102		388,959
Vinci S.A.		20,355		981,250
				1,566,217
Commercial & Professional Supplies 0.1%
Teleperformance		2,767		121,688
Energy 1.6%
Total S.A.		34,580		1,740,655
Insurance 0.2%
AXA S.A.		12,260		229,589
Pharmaceuticals, Biotechnology & Life Sciences 1.6%
Sanofi		16,512		1,785,204
Real Estate 0.2%
Unibail-Rodamco SE		758		198,152
Software & Services 0.3%
UbiSoft Entertainment S.A. *		25,856		288,883
Telecommunication Services 0.2%
France Telecom S.A.		15,501		165,541
Vivendi S.A.		1,363		30,875
				196,416
				9,662,530
Germany 8.2%
Automobiles & Components 0.5%
Continental AG		4,597		546,803
Capital Goods 1.9%
Siemens AG - Reg’d		20,027		2,092,562
Diversified Financials 0.5%
Deutsche Bank AG - Reg’d		12,029		553,731
Insurance 0.3%
Allianz SE - Reg’d		2,506		370,689
Materials 1.2%
BASF SE		13,798		1,291,666
Pharmaceuticals, Biotechnology & Life Sciences 1.8%
Bayer AG - Reg’d		12,091		1,264,071
Merck KGaA		4,749		723,494
				1,987,565
Semiconductors & Semiconductor Equipment 0.5%
Infineon Technologies AG		48,818		386,157
SMA Solar Technology AG		4,905		121,883
				508,040
Software & Services 0.5%
SAP AG		6,544		521,700
Technology Hardware & Equipment 0.1%
Wincor Nixdorf AG		2,162		114,035
Telecommunication Services 0.4%
Deutsche Telekom AG - Reg’d		40,433		478,894
Transportation 0.4%
Deutsche Lufthansa AG - Reg’d		8,365		167,487
Deutsche Post AG - Reg’d		11,784		280,117
				447,604
Utilities 0.1%
E.ON SE AG		7,523		136,622
				9,049,911
Greece 0.1%
Food, Beverage & Tobacco 0.1%
Coca Cola Hellenic Bottling Co., S.A. *		2,201		54,291
Retailing 0.0%
JUMBO S.A. *		5,446		51,443
				105,734
Hong Kong 2.6%
Capital Goods 1.1%
Hutchison Whampoa Ltd.		100,000		1,087,922
Johnson Electric Holdings Ltd.		231,500		157,720
				1,245,642
Energy 0.3%
CNOOC Ltd.		200,000		374,614
Real Estate 1.0%
Cheung Kong (Holdings) Ltd.		39,000		588,577
Sino Land Co., Ltd.		330,000		543,816
				1,132,393
Utilities 0.2%
Power Assets Holdings Ltd.		17,500		171,129
				2,923,778
Ireland 0.3%
Food, Beverage & Tobacco 0.3%
C&C Group plc		47,545		295,350
Materials 0.0%
Smurfit Kappa Group plc		1,535		22,822
				318,172

74 See financial notes

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Israel 0.6%
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Teva Pharmaceutical Industries Ltd.		4,334		166,398
Real Estate 0.5%
Azrieli Group		17,390		502,121
				668,519
Italy 2.0%
Consumer Services 0.4%
Lottomatica Group S.p.A.		16,559		422,440
Energy 0.8%
Eni S.p.A.		34,705		828,284
Real Estate 0.2%
Beni Stabili S.p.A.		267,437		188,641
Telecommunication Services 0.2%
Telecom Italia S.p.A.		291,364		247,485
Utilities 0.4%
Enel S.p.A.		122,774		474,813
				2,161,663
Japan 21.7%
Automobiles & Components 3.2%
Aisin Seiki Co., Ltd.		5,900		212,971
Daihatsu Motor Co., Ltd.		27,000		535,592
Denso Corp.		10,000		448,406
Suzuki Motor Corp.		8,200		210,709
Toyoda Gosei Co., Ltd.		10,600		275,100
Toyota Motor Corp.		32,500		1,886,229
				3,569,007
Banks 5.1%
Aozora Bank Ltd.		61,000		191,119
Mitsubishi UFJ Financial Group, Inc.		289,100		1,961,497
Mizuho Financial Group, Inc.		383,900		844,755
Resona Holdings, Inc.		111,600		595,691
Sumitomo Mitsui Financial Group, Inc.		38,000		1,796,158
The Chiba Bank Ltd.		6,000		46,588
The Shizuoka Bank Ltd.		16,000		195,846
				5,631,654
Capital Goods 2.7%
Asahi Glass Co., Ltd.		33,000		259,288
COMSYS Holdings Corp.		13,600		180,100
Fujikura Ltd.		67,000		251,074
JGC Corp.		6,000		177,788
Mitsubishi Corp.		6,500		117,014
Mitsubishi Heavy Industries Ltd.		137,000		944,759
Mitsui & Co., Ltd.		37,100		511,114
Taisei Corp.		85,000		283,903
The Japan Steel Works Ltd.		42,000		212,833
				2,937,873
Consumer Durables & Apparel 0.9%
Namco Bandai Holdings, Inc.		28,600		521,275
Panasonic Corp. *		29,600		213,324
Sega Sammy Holdings, Inc.		8,600		225,953
Sony Corp.		1,800		29,588
				990,140
Consumer Services 1.4%
Oriental Land Co., Ltd.		9,500		1,535,869
Round One Corp.		6,700		56,159
				1,592,028
Diversified Financials 1.0%
Daiwa Securities Group, Inc.		6,000		53,236
Mitsubishi UFJ Lease & Finance Co., Ltd.		4,900		27,678
ORIX Corp.		70,400		1,080,239
				1,161,153
Food & Staples Retailing 0.4%
Matsumotokiyoshi Holdings Co., Ltd.		14,000		400,751
Food, Beverage & Tobacco 2.2%
Ajinomoto Co., Inc.		37,000		507,803
Japan Tobacco, Inc.		48,800		1,844,699
Kirin Holdings Co., Ltd.		2,000		34,998
				2,387,500
Health Care Equipment & Services 0.3%
Terumo Corp.		6,300		312,987
Household & Personal Products 0.7%
Kao Corp.		24,200		836,788
Insurance 0.4%
Sony Financial Holdings, Inc.		33,600		474,669
Materials 0.1%
Mitsubishi Chemical Holdings Corp.		14,000		68,280
Media 0.1%
SKY Perfect JSAT Holdings, Inc.		310		155,968
Real Estate 0.3%
Nomura Real Estate Holdings, Inc.		12,700		341,425
Retailing 0.4%
Alpen Co., Ltd.		4,400		91,858
Aoyama Trading Co., Ltd.		3,800		113,550
Canon Marketing Japan, Inc.		10,900		158,770
Fast Retailing Co., Ltd.		100		36,671
				400,849
Semiconductors & Semiconductor Equipment 0.1%
Rohm Co., Ltd.		1,900		67,168
Technology Hardware & Equipment 1.6%
Canon, Inc.		35,000		1,258,757
FUJIFILM Holdings Corp.		6,400		131,478
Fujitsu Ltd.		40,000		168,003
Ibiden Co., Ltd.		2,200		38,564
Nippon Electric Glass Co., Ltd.		33,000		168,439
				1,765,241
Transportation 0.6%
Central Japan Railway Co.		2,845		343,116
East Japan Railway Co.		3,400		287,017
				630,133
Utilities 0.2%
Shikoku Electric Power Co., Inc. *		4,400		79,758
The Chugoku Electric Power Co., Inc.		11,400		163,629
				243,387
				23,967,001

See financial notes 75

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Malaysia 0.3%
Utilities 0.3%
Tenaga Nasional Berhad		119,100		307,306
Mexico 0.1%
Materials 0.1%
Grupo Mexico S.A.B. de C.V., Series B		20,700		74,090
Netherlands 4.0%
Capital Goods 1.1%
Koninklijke Philips Electronics N.V.		43,595		1,206,624
Consumer Durables & Apparel 0.0%
TomTom N.V. *		10,987		49,617
Food, Beverage & Tobacco 2.6%
Heineken Holding N.V.		10,993		662,407
Heineken N.V.		1,292		91,441
Unilever N.V. CVA		50,485		2,151,233
				2,905,081
Semiconductors & Semiconductor Equipment 0.3%
STMicroelectronics N.V.		32,680		284,348
				4,445,670
New Zealand 0.1%
Media 0.1%
Sky Network Television Ltd.		31,752		155,790
Norway 1.2%
Energy 0.9%
Statoil A.S.A.		39,750		973,134
Food, Beverage & Tobacco 0.3%
Orkla A.S.A.		40,481		365,030
				1,338,164
Portugal 0.1%
Capital Goods 0.1%
Sonae		75,392		73,204
Republic of Korea 0.1%
Semiconductors & Semiconductor Equipment 0.1%
Samsung Electronics Co., Ltd.		115		159,047
Singapore 1.5%
Capital Goods 0.4%
Noble Group Ltd.		306,000		280,691
Singapore Technologies Engineering Ltd.		39,000		139,583
				420,274
Food, Beverage & Tobacco 0.1%
Wilmar International Ltd.		35,000		95,008
Real Estate 0.7%
UOL Group Ltd.		137,000		795,439
Transportation 0.3%
Singapore Airlines Ltd.		35,000		316,053
				1,626,774
South Africa 0.2%
Insurance 0.1%
Sanlam Ltd.		21,355		109,569
Materials 0.1%
Kumba Iron Ore Ltd.		1,147		60,802
Retailing 0.0%
Super Group Ltd. *		17,017		45,721
				216,092
Spain 2.9%
Capital Goods 0.4%
Ferrovial S.A.		24,538		405,919
Gamesa Corp. Tecnologica S.A.		13,662		53,455
				459,374
Energy 1.5%
Repsol S.A.		72,909		1,709,319
Retailing 0.5%
Inditex S.A.		3,779		507,162
Utilities 0.5%
Endesa S.A.		23,046		523,129
				3,198,984
Sweden 3.2%
Banks 1.7%
Nordea Bank AB		144,394		1,737,496
Swedbank AB, A Shares		6,826		168,081
				1,905,577
Capital Goods 0.8%
Scania AB, B Shares		6,983		149,340
Trelleborg AB, B Shares		46,652		694,610
				843,950
Materials 0.0%
Boliden AB		1,446		23,093
Technology Hardware & Equipment 0.7%
Telefonaktiebolaget LM Ericsson, B Shares		59,791		743,583
				3,516,203
Switzerland 7.9%
Capital Goods 0.1%
Bucher Industries AG		418		100,894
Geberit AG - Reg’d		130		31,770
				132,664
Diversified Financials 0.1%
GAM Holding AG *		6,560		116,013
Food, Beverage & Tobacco 1.2%
Coca Cola HBC AG *		1,194		30,442
Nestle S.A. - Reg’d		18,610		1,327,125
				1,357,567

76 See financial notes

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Insurance 1.7%
Helvetia Holding AG - Reg’d		2,550		1,069,814
Swiss Re AG *		9,746		775,602
				1,845,416
Pharmaceuticals, Biotechnology & Life Sciences 4.8%
Actelion Ltd. - Reg’d *		5,928		362,962
Novartis AG - Reg’d		35,057		2,595,185
Roche Holding AG		9,370		2,345,689
				5,303,836
				8,755,496
Taiwan 0.1%
Semiconductors & Semiconductor Equipment 0.1%
Taiwan Semiconductor Manufacturing Co., Ltd.		15,000		55,672
United Kingdom 20.8%
Banks 2.1%
Barclays plc		139,033		620,431
HSBC Holdings plc		152,362		1,668,667
				2,289,098
Capital Goods 1.2%
BAE Systems plc		103,810		606,322
Bodycote plc		55,138		444,247
Cobham plc		62,420		243,183
				1,293,752
Commercial & Professional Supplies 1.0%
Berendsen plc		87,942		1,056,804
Consumer Durables & Apparel 0.5%
Persimmon plc		32,782		550,695
Persimmon plc - Reg’d, B Shares (a)		32,782		38,191
				588,886
Diversified Financials 0.7%
Aberdeen Asset Management plc		83,310		581,529
Man Group plc		92,831		147,372
				728,901
Energy 3.5%
BG Group plc		15,625		263,771
BP plc		249,292		1,806,405
Enquest plc *		91,661		183,640
Ensco plc, Class A		7,025		405,202
Royal Dutch Shell plc, B Shares		17,266		605,647
Soco International plc *		97,503		574,878
				3,839,543
Food & Staples Retailing 0.1%
J. Sainsbury plc		28,712		170,160
Food, Beverage & Tobacco 1.0%
Associated British Foods plc		25,989		781,795
British American Tobacco plc		3,269		181,218
Unilever plc		2,657		115,119
				1,078,132
Household & Personal Products 0.2%
Reckitt Benckiser Group plc		3,224		235,355
Materials 3.7%
BHP Billiton plc		36,330		1,022,064
Evraz plc		32,862		79,969
Lonmin plc *		20,954		87,894
Mondi plc		83,126		1,104,701
Rio Tinto plc		38,154		1,752,035
				4,046,663
Pharmaceuticals, Biotechnology & Life Sciences 1.9%
AstraZeneca plc		41,269		2,142,727
Real Estate 0.4%
Grainger plc		218,230		461,826
Retailing 0.6%
Next plc		6,048		409,972
WH Smith plc		24,342		280,159
				690,131
Software & Services 0.4%
Micro Focus International plc		31,161		324,377
The Sage Group plc		30,976		162,519
				486,896
Technology Hardware & Equipment 0.4%
Halma plc		46,142		359,204
Pace plc		8,728		33,663
				392,867
Telecommunication Services 1.6%
Vodafone Group plc		562,711		1,716,997
Utilities 1.5%
National Grid plc		124,066		1,581,495
SSE plc		3,620		87,647
				1,669,142
				22,887,880
Total Common Stock
(Cost $92,163,061)				108,536,402
Other Investment Companies 1.9% of net assets
United States 1.9%
iShares MSCI EAFE Index Fund		6,700		414,998
State Street Institutional U.S. Government Money Market Fund		1,708,663		1,708,663
Total Other Investment Companies
(Cost $2,059,200)				2,123,661
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $94,413,583 and the unrealized appreciation and depreciation were $17,615,572 and ($1,369,092), respectively, with a net unrealized appreciation of $16,246,480.

At 04/30/13, the values of certain foreign securities held by the fund aggregating $105,867,483 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.

See financial notes 77

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

CVA —	Dutch Certificate
Reg’d —	Registered

EUR —	Euro
USD —	U.S. dollar

In addition to the above, the fund held the following at 04/30/13.

				Amount of				Amount of
		Currency		Currency		Currency		Currency		Unrealized
Expiration		to be		to be		to be		to be		Gains
Date	Counterparty	Received		Received		Delivered		Delivered		($)
Forward Foreign Currency Exchange Contract
05/09/2013	State Street Bank and Trust Co.		EUR		41,970		USD		55,275		71

78 See financial notes

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$37,433,646		$—		$37,433,646
Austria
Banks		271,256		139,323		—		410,579
Transportation		285,524		—		—		285,524
Belgium1		—		833,669		—		833,669
Materials		55,699		—		—		55,699
Brazil1		77,768		—		—		77,768
Canada1		442,472		—		—		442,472
Chile1		129,238		—		—		129,238
France1		—		9,464,378		—		9,464,378
Real Estate		198,152		—		—		198,152
Greece1		—		51,443		—		51,443
Food, Beverage & Tobacco		54,291		—		—		54,291
Japan1		—		20,628,279		—		20,628,279
Capital Goods		212,833		2,725,040		—		2,937,873
Retailing		113,550		287,299		—		400,849
Mexico1		74,090		—		—		74,090
South Africa1		—		170,371		—		170,371
Retailing		45,721		—		—		45,721
Spain1		—		2,739,610		—		2,739,610
Capital Goods		53,455		405,919		—		459,374
Switzerland1		—		7,397,929		—		7,397,929
Food, Beverage & Tobacco		30,442		1,327,125		—		1,357,567
United Kingdom1		—		17,337,683		—		17,337,683
Consumer Durables & Apparel		—		550,695		38,191		588,886
Diversified Financials		147,372		581,529		—		728,901
Energy		405,202		3,434,341		—		3,839,543
Technology Hardware & Equipment		33,663		359,204		—		392,867
Other Investment Companies1		2,123,661		—		—		2,123,661
Total		$4,754,389		$105,867,483		$38,191		$110,660,063
Other Financial Instruments
Forward Foreign Currency Exchange Contract2		$71		$—		$—		$71

1	As categorized in Portfolio Holdings.
2	Forward foreign currency exchange contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

See financial notes 79

 Schwab International Core Equity Fund

Portfolio Holdings (Unaudited) continued

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in										Balance
	as of		Realized		Unrealized						Gross		Gross		as of
	October 31,		Gains		Gains		Gross		Gross		Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)		Purchases		Sales		in		out		2013
Common Stock
United Kingdom		$—		$—		$740		$37,451		$—		$—		$—		$38,191
Total		$—		$—		$740		$37,451		$—		$—		$—		$38,191

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The change in net unrealized gains (losses) for Level 3 investments held by the fund at April 30, 2013 was $740.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were security transfers in the amount of $288,649 and $211,935 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, for the period ended April 30, 2013. The transfers between Level 1 and Level 2 were primarily due to the use of international fair valuation by the fund. There were no transfers in or out of Level 3 securities during the period.

80 See financial notes

 Schwab International Core Equity Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $94,222,261)		$110,660,063
Foreign currency, at value (cost $13,052)		13,163
Receivables:
Investments sold		363,915
Fund shares sold		653,288
Dividends		395,635
Foreign tax reclaims		108,492
Interest		10
Unrealized gains on forward foreign currency exchange contracts	+	71
Total assets		112,194,637
Liabilities
Payables:
Investments bought		1,850,020
Investment adviser and administrator fees		3,641
Shareholder service fees		3,793
Fund shares redeemed		91,524
Distribution and shareholder services fees		695
Accrued expenses	+	34,386
Total liabilities		1,984,059
Net Assets
Total assets		112,194,637
Total liabilities	−	1,984,059
Net assets		$110,210,578
Net Assets by Source
Capital received from investors		108,840,749
Net investment income not yet distributed		597,153
Net realized capital losses		(15,664,065	)
Net unrealized capital gains		16,436,741
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$110,210,578		12,259,536			$8.99

See financial notes 81

 Schwab International Core Equity Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $110,298)		$1,618,974
Interest	+	129
Total investment income		1,619,103
Expenses
Investment adviser and administrator fees		259,432
Shareholder service fees		110,168
Portfolio accounting fees		33,643
Custodian fees		30,594
Professional fees		23,522
Registration fees		10,379
Transfer agent fees		8,849
Shareholder reports		8,236
Trustees’ fees		3,091
Interest expense		90
Other expenses	+	5,141
Total expenses		493,145
Expense reduction by CSIM and its affiliates	−	108,379
Net expenses	−	384,766
Net investment income		1,234,337
Realized and Unrealized Gains (Losses)
Net realized gains on investments		2,866,352
Net realized gains on foreign currency transactions	+	5,184
Net realized gains		2,871,536
Net unrealized gains on investments		10,179,367
Net unrealized gains on foreign currency translations	+	3,366
Net unrealized gains	+	10,182,733
Net realized and unrealized gains		13,054,269
Increase in net assets resulting from operations		$14,288,606

82 See financial notes

 Schwab International Core Equity Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$1,234,337			$1,569,563
Net realized gains (losses)		2,871,536			(609,529	)
Net unrealized gains	+	10,182,733			6,164,196
Increase in net assets from operations		14,288,606			7,124,230
Distributions to Shareholders
Distributions from net investment income		($2,100,275	)		($1,709,354	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			3,685,837		$30,787,156			3,640,288		$26,971,761
Shares reinvested			154,692		1,217,426			151,161		1,017,316
Shares redeemed	+		(1,472,971	)	(12,100,319	)		(2,074,860	)	(15,099,441	)
Net transactions in fund shares			2,367,558		$19,904,263			1,716,589		$12,889,636
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			9,891,978		$78,117,984			8,175,389		$59,813,472
Total increase	+		2,367,558		32,092,594			1,716,589		18,304,512
End of period			12,259,536		$110,210,578			9,891,978		$78,117,984
Net investment income not yet distributed					$597,153					$1,463,091

See financial notes 83

 Schwab Active Equity Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds discussed in this report is a series of Schwab Capital Trust (the “trust”), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trust as of the end of the period, including the funds discussed in this report, which are highlighted:

Schwab Capital Trust (organized May 7, 1993)	Schwab Balanced Fund
Schwab Core Equity Fund	Schwab Target 2010 Fund
Schwab Dividend Equity Fund	Schwab Target 2015 Fund
Schwab Large-Cap Growth Fund	Schwab Target 2020 Fund
Schwab Small-Cap Equity Fund	Schwab Target 2025 Fund
Schwab Hedged Equity Fund	Schwab Target 2030 Fund
Schwab Financial Services Fund	Schwab Target 2035 Fund
Schwab Health Care Fund	Schwab Target 2040 Fund
Schwab International Core Equity Fund	Schwab Target 2045 Fund
Schwab S&P 500 Index Fund	Schwab Target 2050 Fund
Schwab Small-Cap Index Fund	Schwab Target 2055 Fund
Schwab Total Stock Market Index Fund	Schwab Fundamental US Large Company Index Fund
Schwab International Index Fund	Schwab Fundamental US Small Company Index Fund
Schwab MarketTrack All Equity Portfolio	Schwab Fundamental International Large Company Index Fund
Schwab MarketTrack Growth Portfolio	Schwab Fundamental International Small Company Index Fund
Schwab MarketTrack Balanced Portfolio	Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab MarketTrack Conservative Portfolio	Schwab Monthly Income Fund - Moderate Payout
Laudus Small-Cap MarketMasters Fund	Schwab Monthly Income Fund - Enhanced Payout
Laudus International MarketMasters Fund	Schwab Monthly Income Fund - Maximum Payout

Each fund in this report offers one share class. Shares are bought and sold (subject to a redemption fee, see financial note 9) at closing net asset value per share (“NAV”), which is the price for all outstanding shares of the funds. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the “Board”) may authorize the issuance of as many shares as necessary.

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 may also keep certain assets in segregated accounts, as required by securities law.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

(a) Security Valuation:

Under procedures approved by the Board, the investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

The funds value the securities in their portfolios every business day. The funds use the following policies to value various types of securities:

•  Securities traded on an exchange or over-the-counter: Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at halfway between the most recent bid and ask quotes. Securities that are primarily traded on foreign exchanges are valued at the official closing price or the last sales price on the exchange where the securities are principally traded with these values then translated into U.S. dollars at the current exchange rate, unless these securities are fair valued as discussed below.

•  Securities for which no quoted value is available: The Board has adopted procedures to fair value each fund’s securities when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Each fund makes fair value determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a

84 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ techniques such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing Committee regularly reviews these inputs and assumptions to calibrate the valuations. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security. The Board convenes on a regular basis to review fair value determinations made by the funds pursuant to the valuation procedures.

•  Foreign equity security fair valuation: The Board has adopted procedures to fair value foreign equity securities that are traded in markets that close prior to the funds valuing their holdings. By fair valuing securities whose prices may have been affected by events occurring after the close of trading, each fund seeks to establish prices that investors might expect to realize upon the current sales of these securities. This methodology is designed to deter “arbitrage” market timers, who seek to exploit delays between the change in the value of a fund’s portfolio holdings and the net asset value of the fund’s shares, and seeks to help ensure that the prices at which the fund’s shares are purchased and redeemed are fair and do not result in dilution of shareholder interest or other harm to shareholders. When fair value pricing is used at the open or close of a reporting period, it may cause a temporary divergence between the return of a fund and that of its comparative index or benchmark. The Board regularly reviews fair value determinations made by the funds pursuant to these procedures.

•  Futures and forward foreign currency exchange contracts: Futures and forwards are valued at their settlement prices as of the close of their exchanges (for futures) or at a value based on that day’s forward exchange rates (for forwards).

•  Short-term securities (60 days or less to maturity): Short-term securities are valued at amortized cost, which approximates market value.

•  Underlying funds: Mutual funds are valued at their respective net asset values. Exchange trade funds (ETFs) traded on a recognized securities exchange are valued at the last reported sale price that day or the official closing price, if applicable.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If the funds determine that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

•  Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities and futures contracts. Investments in mutual funds are valued daily at their NAVs, which are classified as Level 1 prices.

•  Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. In addition, international securities whose markets close hours before the funds value their holdings may require fair valuations due to significant movement in the U.S. markets occurring after the daily close of the foreign markets. The Board has approved a vendor that calculates fair valuations of international equity securities based on a number of factors that appear to correlate to the movements in the U.S. markets. As investments whose values are classified as Level 2 prices include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

85

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

•  Level 3 — significant unobservable inputs (including the funds’ own assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not available for these securities, the funds use one or more valuation techniques for which sufficient and reliable data is available. The inputs used by the funds in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the funds in the absence of market information. Assumptions used by the funds due to the lack of observable inputs may significantly impact the resulting fair value and therefore the funds’ results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the funds’ investments as of April 30, 2013 are disclosed in the Portfolio Holdings.

(b) Accounting Policies for certain Portfolio Investments (if held):

Futures Contracts: Futures contracts are instruments that represent an agreement between two parties that obligates one party to buy, and the other party to sell, specific instruments at an agreed upon price on a stipulated future date. A fund must give the broker a deposit of cash and/or securities (initial margin) whenever it enters into the futures contract. The amount of the deposit may vary from one contract to another. Subsequent payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized gains or losses until the contract is closed, at which time the gains or losses are realized. Futures are traded publicly on exchanges, and their market value changes daily.

Forward Foreign Currency Exchange Contracts: “Forwards”, as they are known, are contracts to buy and sell a currency at a set price on a future date. The value of the forwards is accounted for as unrealized gains or losses until the contracts settle, at which time the gains or losses are realized.

Securities Lending: Under the trust’s Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to have a value of at least 102% of the prior day’s market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities and is marked to market daily. The cash collateral of securities loaned is invested in money market portfolios operating under Rule 2a-7 of the 1940 Act. Securities lending income, as disclosed in a fund’s Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent which are subject to adjustments pursuant to the securities lending agreement.

If applicable, the value of the securities on loan as of April 30, 2013 and the value of the related collateral are disclosed in the Statement of Assets and Liabilities and the Portfolio Holdings.

Short Sales: When a fund sells securities short (sells securities it does not own), the fund identifies assets worth at least 100% of the value of the short securities as collateral. If the market value of the short securities subsequently falls, the fund can realize a gain by closing the short position. However, if the value rises, the fund typically would have to add to its collateral or close out its short position at a loss. The potential for losses associated with short positions is much greater than the original value of the securities sold short and may exceed amounts recorded in the Statement of Assets and Liabilities.

(c) Security Transactions:

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains or 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 calculated using exchange rates in effect on the transaction date. Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the

86 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

trade and settlement dates on securities transactions and the differences between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains or losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period. These realized and unrealized foreign exchange gains or losses are reported in foreign currency transactions or translations in the Statement of Operations. The funds do not isolate the portion of the fluctuations on investments resulting from changes in foreign currency exchange rates from the fluctuations in market prices of investments held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.

If the fund sells securities short, it records the proceeds received as an asset and the obligation to buy back the securities as a liability. At the time a short sale is initiated, the asset and liability are of equal value and effectively cancel each other out. Subsequently, the fund values the liability side of the transaction according to the market price of the securities sold short, and values the asset side according to the value of the proceeds. When the fund closes out a short position (buys the security), it records the outcome as a realized gain or loss. Dividends accrued on securities sold short are recorded as an expense on the fund’s records and presented in the Statement of Operations. The fund may also incur stock loan fees which represent the cost of borrowing securities used for short sale transactions.

Gains realized by the funds on the sale of securities in certain foreign countries may be subject to non-U.S. taxes. In those instances, the funds record a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.

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 of the contract, and records a realized gain or loss accordingly.

(d) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds 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 received from foreign sources may result in withholding tax. Withholding taxes are accrued at the same time as the related income if the tax rate is fixed and known, unless a tax withheld is reclaimable from the local tax authorities in which case it is recorded as receivable. If the tax rate is not known or estimable, such expense or reclaim receivable is recorded when the net proceeds are received.

(e) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within the trust generally are allocated among the funds in proportion to their average daily net assets.

(f) Distributions to Shareholders:

The funds make distributions from net investment income, if any, once a year, with the exception of Schwab Dividend Equity Fund which typically pays quarterly dividends. The funds make distributions from net realized capital gains, if any, once a year.

(g) Custody Credit:

Certain funds have an arrangement with their custodian bank, under which the funds may receive a credit for their uninvested cash balance to offset their custody fees and accounting fees. The credit amounts, if any, are disclosed in the Statement of Operations as a reduction to the funds’ operating expenses.

(h) Accounting Estimates:

The accounting policies described in this report conform to GAAP. 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 and these differences may be material.

87

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(i) Federal Income Taxes:

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.

(j) Foreign Taxes:

The funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, corporate events, foreign currency exchanges and capital gains on investments. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in foreign markets in which the funds invest. These foreign taxes, if any, are paid by the funds and are disclosed in the Statement of Operations. Foreign taxes payable as of April 30, 2013, if any, are reflected in the funds’ Statements of Assets and Liabilities.

(k) Indemnification:

Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.

(l) New Accounting Pronouncements:

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative instruments. Management is currently evaluating the impact the adoption of ASU No. 2011-11 may have on the funds’ financial statement disclosures.

3. Risk Factors:

Investing in the funds may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Stock markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of the investment in a fund will fluctuate, which means that investors could lose money.

The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

The funds’ investment adviser makes investment decisions for the funds using a strategy based largely on historical information. There is no guarantee that a strategy based on historical information will produce the desired results in the future. In addition, the portfolio optimization process used by each fund to assist in constructing the fund’s portfolio does not assure successful investment. Securities selected with the assistance of the process may be negatively impacted by factors or events not foreseen in developing the process. As a result, a fund may have a lower return than if it were managed using another process or strategy.

Historically, small-cap stocks have been riskier than large- and mid-cap stocks, and their prices may move sharply, especially during market upturns and downturns. Small-cap companies may be more vulnerable to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall behind other types of investments — large-cap and mid-cap stocks, for instance — a fund’s small-cap holdings could reduce performance.

Both large- and mid-cap stocks tend to go in and out of favor based on market and economic conditions. However, stocks of mid-cap companies tend to be more vulnerable to adverse business or economic events than larger, more established companies. During a period when large- and mid-cap U.S. stocks fall behind other types of investments — small-cap stocks, for instance — a fund’s large- and mid-cap holdings could reduce performance.

88 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Growth stocks can be volatile. Growth companies usually invest a high portion of earnings in their businesses and may lack the dividends of value stocks that can cushion stock prices in a falling market. The prices of growth stocks are based largely on projections of the issuer’s future earnings and revenues. If a company’s earnings or revenues fall short of expectations, its stock price may fall dramatically. Growth stocks may also be more expensive relative to their earnings or assets compared to value or other stocks.

To the extent that a fund invests in dividend paying stocks, the fund’s performance will correlate directly with the performance of the dividend paying stock segment of the stock market, and the fund may underperform funds that do not limit their investments to dividend paying stocks. If stocks held by a fund reduce or stop paying dividends, the fund’s ability to generate income may be affected.

A fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Certain of these risks, such as liquidity risk and market risk, are discussed elsewhere in this section. A fund’s use of derivatives is also subject to credit risk, leverage risk, lack of availability risk, valuation risk, correlation risk and tax risk. Lack of availability risk is the risk that suitable derivative transactions may not be available in all circumstances for risk management or other purposes. Credit risk is the risk that the counterparty to a derivatives transaction may not fulfill its obligations. Leverage risk is the risk that a small percentage of assets invested in derivatives can have a disproportionately larger impact on a fund. Valuation risk is the risk that a particular derivative may be valued incorrectly. Correlation risk is the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate or index. Tax risk is the risk that the use of derivatives may cause the fund to realize higher amounts of short-term capital gain. These risks could cause a fund to lose more than the principal amount invested.

A particular investment may be difficult to purchase or sell. A fund may be unable to sell illiquid securities at an advantageous time or price.

Convertible securities generally are debt obligations that pay income, but which may convert into common or preferred stock under certain circumstances. These investments, which are often issued by smaller or less established companies, are subject to the equity risks described above, but they also are subject to fixed income risks. For example, an issuer may fail to pay interest or dividends, and prices of convertible securities generally will fall when interest rates rise.

When a fund invests in an exchange-traded fund (“ETF”), it will bear a proportionate share of the ETF’s expenses. In addition, lack of liquidity in an ETF can result in its value being more volatile than the underlying portfolio of securities.

A fund’s investments in real estate investment trusts (“REITs”) will be subject to the risks associated with the direct ownership of real estate, including fluctuations in the value of underlying properties, defaults by borrowers or tenants, changes in interest rates and risks related to general or local economic conditions. REITs are also subject to certain additional risks; for example, REITs are dependent upon specialized management skills and cash flows, and may have their investments in relatively few properties, a small geographic area or a single property type. Failure of a company to qualify as a REIT under federal tax law may have adverse consequences on a fund. In addition, REITs have their own expenses, and a fund will bear a proportionate share of those expenses.

Certain funds engage in short sales transactions. Short sales are transactions in which a fund sells a security it does not own. To complete a short sale, a fund must borrow the security to deliver to the buyer. A fund is then obligated to replace the borrowed security by purchasing the security at the market price at the time of replacement. This price may be more or less than the price at which the security was sold by a fund, and the fund will incur a loss if the price of the security sold short increases between the time of the short sales and the time the fund replaces the borrowed security.

To the extent a fund establishes both long and short positions in equity securities the fund’s long positions could decline in value at the same time that the value of the stocks sold short increase, thereby increasing the fund’s overall potential for loss. A fund’s short sales may result in a loss if the prices of the borrowed securities rise and it costs more to replace the borrowed securities. In contrast to a fund’s long positions, the potential loss on the fund’s short positions is unlimited. In addition, the lender of the borrowed securities may require a fund to return the securities on short notice, which may require the fund to purchase the borrowed securities at an unfavorable price, resulting in a loss.

A fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency

89

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs.

Emerging markets may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Emerging market countries often have less uniformity in accounting and reporting requirements. It is sometimes difficult to obtain and enforce court judgments in such countries and there is often a greater potential for nationalization and/or expropriation of assets by the government of an emerging market country. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in other countries. As a result, there will tend to be an increased risk of price volatility associated with a fund’s investments in emerging market countries, which may be magnified by currency fluctuations relative to the U.S. dollar.

To the extent a fund’s investments in a single country or a limited number of countries represent a higher percentage of the fund’s assets, the fund assumes the risk that economic, political and social conditions in those countries will have a significant impact on its investment performance and it may be subject to increased price volatility.

The investments of certain funds are concentrated in issuers doing business in the same sector, and therefore, the companies in which a fund invests will be affected by many of the same factors, such as legislative or regulatory changes, intense competition for market share, and other competitive challenges. In addition, a fund is subject to the risks that stocks of these companies may underperform other segments of the equity market or stock market as a whole and are likely to have above-average volatility.

Securities lending involves the risk of loss of rights in the collateral or delay in recovery of the collateral if the borrower fails to return the security loaned or becomes insolvent.

Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.

4. Affiliates and Affiliated Transactions:

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement (“Advisory Agreement”) between CSIM and the trust.

For its advisory and administrative services to the funds, CSIM is entitled to receive an annual fee, payable monthly, based on a percentage of each fund’s average daily net assets as follows:

Schwab

Schwab

Schwab

Schwab

Schwab

Schwab

International

% of Average

Core

Dividend

Large-Cap

Small-Cap

Hedged

Core

Daily Net Assets

Equity Fund

Equity Fund

Growth Fund

Equity Fund

Equity Fund

Equity Fund

Flat rate

0.47%

0.62%

0.72%

0.81%

1.05%

0.58%

	Schwab		Schwab
% of Average	Financial		Health Care
Daily Net Assets	Services Fund		Fund
First $500 million		0.54%		0.54%
$500 million to $1 billion		0.515%		0.515%
Over $1 billion		0.49%		0.49%

The Board has adopted a Shareholder Servicing Plan (the “Plan”) on behalf of the funds. The Plan enables each fund to bear expenses relating to the provision by service providers, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, “Schwab”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds. Schwab serves as the funds’ paying agent under the Plan for making payments of the shareholder service fee due to the service providers (other than Schwab). All shareholder service fees paid by the funds to Schwab in its capacity as the funds’ paying agent will be passed through to the service providers, and Schwab will not retain any portion of such fees.

Pursuant to the Plan, each fund’s shares are subject to an annual shareholder servicing fee up to 0.25%. The shareholder servicing fee paid to a particular service provider is made pursuant to its written agreement with Schwab (or, in the case of payments made to Schwab, pursuant to Schwab’s written agreement with the funds), and the funds will pay no more than 0.25% of the average annual daily net asset value of the fund shares owned by shareholders holding shares through such service

90 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

providers. Payments under the Plan are made as described above regardless of Schwab’s or the service provider’s actual cost of providing the services. If the cost of providing the services under the Plan is less than the payment received, the unexpended portion of the fees may be retained as profit by Schwab or the service provider.

Although these agreements specify certain fees for these services, CSIM and its affiliates have made an additional agreement with the funds, for so long as CSIM serves as the investment adviser to the funds, which may only be amended or terminated with the approval of the Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses (“expense limitation”). The expense limitation as a percentage of average daily net assets is as follows:

Schwab		Schwab		Schwab		Schwab		Schwab
Core		Dividend		Large-Cap		Small-Cap		Hedged
Equity Fund		Equity Fund		Growth Fund		Equity Fund		Equity Fund
	0.75%		0.89%		0.99%		1.12%		1.33%	*

				Schwab
Schwab		Schwab		International
Financial		Health Care		Core
Services Fund		Fund		Equity Fund
	0.94%		0.82%		0.86%

* Excludes dividends and stock loan fees paid on securities sold short.

Certain Schwab Funds may own shares of other Schwab Funds. The table below reflects the percentages of each fund shares in this report owned by other Schwab Funds as of April 30, 2013:

	Schwab			Schwab			Schwab
	Core			Dividend			Small-Cap
	Equity Fund			Equity Fund			Equity Fund
Schwab Target 2010 Fund		0.2%			0.1%			0.5%
Schwab Target 2015 Fund		0.3%			0.2%			0.8%
Schwab Target 2020 Fund		1.5%			0.9%			4.2%
Schwab Target 2025 Fund		1.0%			0.6%			2.6%
Schwab Target 2030 Fund		2.9%			1.8%			7.9%
Schwab Target 2035 Fund		0.9%			0.6%			2.5%
Schwab Target 2040 Fund		3.4%			2.1%			9.3%
Schwab Target 2045 Fund		0.0%	*		0.0%	*		0.1%
Schwab Target 2050 Fund		0.0%	*		0.0%	*		0.1%
Schwab Target 2055 Fund		0.0%	*		0.0%	*		0.0%	*
Schwab Monthly Income Fund - Moderate Payout		—%			0.7%			—%
Schwab Monthly Income Fund - Enhanced Payout		—%			1.2%			—%
Schwab Monthly Income Fund - Maximum Payout		—%			0.5%			—%
Schwab Balanced Fund		2.5%			—%			—%

* Less than 0.05%

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other Schwab Funds. All loans are for temporary or emergency purposes only. The interest rate to be charged on a loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.

During the period, the investment adviser voluntarily reduced its investment adviser fees for the Schwab Core Equity Fund and Schwab Small-Cap Equity Fund by $6,944 each, to reflect a credit in certain stock research fees incurred by the investment adviser and passed on to these funds.

91

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

5. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted in each fund’s Statement of Operations. For information regarding the trustees please refer to Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The funds have access to custodian overdraft facilities, a committed line of credit of $150 million with State Street Bank and Trust Company (“State Street”), an uncommitted line of credit of $100 million with Bank of America, N.A. and an uncommitted line of credit of $50 million with Brown Brothers Harriman & Co. The funds pay interest on the amounts they borrow at rates that are negotiated periodically. The funds also pay an annual fee to State Street for the committed line of credit.

There were no borrowings from the lines of credit by the funds during the period. However, the funds may have utilized their overdraft facility and incurred interest expense, which is disclosed in the Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2013, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Schwab Core Equity Fund		$1,033,579,629		$1,061,523,280
Schwab Dividend Equity Fund		612,972,819		598,999,256
Schwab Large-Cap Growth Fund		105,089,704		114,349,705
Schwab Small-Cap Equity Fund		243,208,537		237,455,730
Schwab Hedged Equity Fund*		138,607,483		144,426,681
Schwab Financial Services Fund		28,597,477		27,772,710
Schwab Health Care Fund		175,178,342		119,174,529
Schwab International Core Equity Fund		61,371,823		42,345,449

* Including securities sold short.

8. Derivatives:

Certain funds entered into equity index futures contracts (“futures”) during the report period. The funds invested in futures to equitize available cash. The fair value and due to brokers for futures contracts held at April 30, 2013 are presented on the face of the Portfolio Holdings and Statement of Assets, respectively. The net realized/unrealized gains (losses) on futures contracts are presented on the Statement of Operations. Refer to financial note 2(b) for the funds’ accounting policies with respect to futures contracts and financial note 3 for disclosures concerning the risks of investing in futures contracts. During the period, the month-end average contract values of futures contracts held by the funds and the month-end average number of contracts held were as follows:

	Contract Values		Number of Contracts
Schwab Core Equity Fund		$9,219,463		125
Schwab Dividend Equity Fund		8,374,879		110
Schwab Large-Cap Growth Fund		920,325		13
Schwab Small-Cap Equity Fund		1,498,683		17
Schwab Hedged Equity Fund		508,508		7
Schwab Financial Services Fund		662,153		9
Schwab Health Care Fund		7,865,333		104
Schwab International Core Equity Fund		—		—

92 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

8. Derivatives (continued):

The Schwab International Core Equity Fund entered into forward foreign currency exchange contracts (“forwards”) during the report period. The fund invested in forwards in connection with the purchase and sale of portfolio securities to minimize the uncertainty of changes in future foreign currency exchange rates. The fair value for forwards held at April 30, 2013 are presented on the face of the Portfolio Holdings and as Unrealized gains on forward foreign currency exchange contracts on the fund’s Statement of Assets and Liabilities. The net realized losses of ($218) and net unrealized gains of $71 on forwards held during the period are included in net realized gains on foreign currency transactions and net unrealized gains on foreign currency translations of the fund’s Statement of Operations, respectively. Refer to financial note 2(b) for the fund’s accounting policies with respect to forwards and financial note 3 for disclosures concerning the risks of investing in forwards. During the period, the month-end average forward foreign currency notional amount and the month-end average unrealized gains (losses) were $19,904 and ($2), respectively.

9. Redemption Fee:

The funds charge a 2.00% redemption fee on shares sold or exchanged within 30 days of the original purchase date. Such amounts are netted against redemption proceeds in the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

	Current Period		Prior Period
	(11/1/12-4/30/13)		(11/1/11-10/31/12)
Schwab Core Equity Fund		$11,854		$14,523
Schwab Dividend Equity Fund		11,928		19,131
Schwab Large-Cap Growth Fund		2,575		6,173
Schwab Small-Cap Equity Fund		5,134		4,731
Schwab Hedged Equity Fund		6,258		5,426
Schwab Financial Services Fund		1,756		5,169
Schwab Health Care Fund		14,745		11,650
Schwab International Core Equity Fund		4,963		1,452

10. Federal Income Taxes:

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of October 31, 2012, the funds had capital loss carryforwards available to offset future net capital gains before the expiration dates as follows:

	Schwab			Schwab		Schwab		Schwab		Schwab
	Core			Dividend		Large-Cap		Small-Cap		Hedged
Expiration Date	Equity Fund			Equity Fund		Growth Fund		Equity Fund		Equity Fund
October 31, 2016		$53,230,501			$—		$—		$—		$—
October 31, 2017		56,516,765			66,553,849		45,816,541		14,134,762		2,570,724
Total		$109,747,266	*		$66,553,849		$45,816,541		$14,134,762		$2,570,724

93

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

10. Federal Income Taxes (continued):

					Schwab
	Schwab		Schwab		International
	Financial		Health Care		Core
Expiration Date	Services Fund		Fund		Equity Fund
					Schwab
	Schwab		Schwab		International
	Financial		Health Care		Core
Expiration Date	Services Fund		Fund		Equity Fund
October 31, 2016		$6,950,804		$—		$—
October 31, 2017		28,673,848		—		17,505,510
October 31, 2018		170,394		—		—
No expiration**		—		—		813,296		��
Total		$35,795,046		$—		$18,318,806	*

*

The Schwab Core Equity Fund and Schwab International Core Equity Fund have capital loss carryforwards acquired via mergers which are subject to certain annual limitations in regard to availability to offset potential future capital gains.

**

As a result of the passage of the Regulated Investment Company Modernization Act of 2010, capital losses incurred after December 31, 2010 may now be carried forward indefinitely, but must retain the character of the original loss. However, such losses must be utilized prior to the pre-enactment capital losses, which may increase the likelihood that the pre-enactment capital losses may expire unused. Under pre-enactment law, capital losses could be carried forward for eight years, and carried forward as short-term capital loss, irrespective of the character of the original loss.

For the year ended October 31, 2012, the funds had capital losses deferred and capital losses utilized as follows:

	Schwab		Schwab		Schwab		Schwab		Schwab
	Core		Dividend		Large-Cap		Small-Cap		Hedged
	Equity Fund		Equity Fund		Growth Fund		Equity Fund		Equity Fund
Capital losses deferred		$—		$—		$—		$—		$900,099
Capital losses utilized		138,165,164		106,534,439		29,184,829		34,374,879		15,562,685
					Schwab
	Schwab		Schwab		International
	Financial		Health Care		Core
	Services Fund		Fund		Equity Fund
Capital losses utilized		$1,500,550		$14,437,135		$—

As of October 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended October 31, 2012, the funds did not incur any interest or penalties.

11. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

12. Reorganization:

Under a plan of reorganization adopted by the Trust, all of the assets and liabilities of the Schwab Premier Equity Fund were transferred to the Schwab Core Equity Fund. The reorganization, which qualified as a tax-free exchange for federal income tax purposes, was completed at the close of business on September 7, 2012. The following is a summary of shares outstanding, net

94 

 Schwab Active Equity Funds

Financial Notes, unaudited (continued)

12. Reorganization (continued):

assets, net asset value per share issued and unrealized appreciation/ depreciation immediately before and after the reorganization.

	Before Reorganization				After Reorganization
	Schwab		Schwab		Schwab
	Core		Premier		Core
	Equity Fund		Equity Fund		Equity Fund
Shares		90,245,503		18,709,075		101,529,069
Net Assets		$1,728,474,999		$216,114,348		$1,944,589,347
Net Assets Value		$19.15		$11.55		$19.15
Net unrealized appreciation/(depreciation)		$280,749,404		$13,800,558		$294,549,962
Market value of investments		$1,724,850,404		$215,621,273		$1,940,471,677
Cost of investments		$1,444,101,000		$201,820,715		$1,645,921,715

95

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Capital Trust, which includes the funds covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The Fund Complex includes 94 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the funds’ Statement of Additional Information, which is available free by calling 1-800-435-4000.

 Independent Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Mariann Byerwalter 1960 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman of JDN Corporate Advisory LLC (advisory services firm) (Oct. 2001 – present).	77	Director,WageWorks, Inc. (2010 – present) Director, Redwood Trust, Inc. (1998 – present) Director, PMI Group Inc. (2001 – 2009)
John F. Cogan 1947 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research; Professor of Public Policy, Stanford University (Sept. 2000 – present).	77	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
William A. Hasler 1941 Trustee (Trustee of Schwab Capital Trust since 2000.)	Dean Emeritus, Haas School of Business, University of California, Berkeley (July 1998 – present).	77	Director, TOUSA (1998 – present) Director, Globalstar, Inc. (2009 – present) Director, Aviat Networks (2001 – present) Director, Mission West Properties (1998 – 2012) Director, Ditech Networks Corporation (1997 – 2012) Director, Genitope Corporation (2000 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	77	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Tercica Inc. (2004 – 2008)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – present); Senior Vice President and General Manager of Consumer Group, Intuit, Inc. (June 2007 – Dec. 2008); Senior Vice President and Chief Financial Officer, Intuit, Inc. (Sept. 2005 – Jan. 2008).	77	Director, KLA-Tencor Corporation (2008 – present) Director, BEA Systems, Inc. (2007 – 2008)
Gerald B. Smith 1950 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (1990 – present).	77	Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – present) Director, Oneok, Inc (2009 – present) Lead Independent Director, Board of Cooper Industries (2002 – 2012)

96 

 Independent Trustees (continued)

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (Jan. 2008- present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	77	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

 Interested Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served )	During the Past Five Years	the Trustee	Other Directorships
Charles R. Schwab2 1937 Chairman and Trustee (Chairman and Trustee of Schwab Capital Trust since 1993.)	Chairman and Director, The Charles Schwab Corporation, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc., Charles Schwab Bank, N. A.; Chairman and Chief Executive Officer, Schwab (SIS) Holdings Inc. I, Schwab International Holdings, Inc.; Chief Executive Officer, Schwab Holdings, Inc.; Through June 2007, Director, U.S. Trust Company, N. A., U.S. Trust Corporation, United States Trust Company of New York. Until October 2008, Chief Executive Officer, The Charles Schwab Corporation, Charles Schwab & Co., Inc.	77	None
Walter W. Bettinger II2 1960 Trustee (Trustee of Schwab Capital Trust since 2008.)	As of October 2008, President and Chief Executive Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. Since October 2008, Director, The Charles Schwab Corporation. Since May 2008, Director, Charles Schwab & Co., Inc. and Schwab Holdings, Inc. Since 2006, Director, Charles Schwab Bank. Until October 2008, President and Chief Operating Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. From 2004 through 2007, Executive Vice President and President, Schwab Investor Services. From 2004 through 2005, Executive Vice President and Chief Operating Officer, Individual Investor Enterprise, and from 2002 through 2004, Executive Vice President, Corporate Services.	94	None

 Officers of the Trust

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
Marie Chandoha 1961 President and Chief Executive Officer (Officer of Schwab Capital Trust since 2010.)	Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President and Chief Executive Officer (Dec. 2010 – present) and Chief Investment Officer (Dec. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 2007 – August 2010).

97

 Officers of the Trust (continued)

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
George Pereira 1964 Treasurer and Principal Financial Officer (Officer of Schwab Capital Trust since 2004.)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab Asset Management (Ireland) Limited (April 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 2011 – present); Senior Managing Director, Global Head of Active Fixed-Income Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head of Market-Based Strategies, State Street Research (August 2003 – Jan. 2005).
David Lekich 1964 Secretary and Chief Legal Officer (Officer of Schwab Capital Trust since 2011.)	Senior Vice President (Sept. 2011 – present), Vice President (March 2004 – Sept. 2011), Charles Schwab & Co., Inc.; Senior Vice President and Chief Counsel (Sept. 2011 – present), Vice President (Jan. 2011 – Sept. 2011), Charles Schwab Investment Management, Inc.; Secretary (April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President (Officer of Schwab Capital Trust since 2005.)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant Secretary, Schwab ETFs (Oct. 2009 – present).

1	Trustees remain in office until they resign, retire or are removed by shareholder vote. The Schwab Funds® retirement policy requires that independent trustees elected after January 1, 2000 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the Schwab Funds retirement policy also requires any independent trustee of the Schwab Funds who also serves as an independent trustee of the Laudus Funds to retire from the Boards of the Schwab Funds upon their required retirement date from either the Boards of Trustees of the Schwab Funds or the Laudus Funds, whichever comes first.
2	Mr. Schwab and Mr. Bettinger are Interested Trustees because they are employees of Schwab. In addition to their employment with Schwab, Messrs. Schwab and Bettinger also own stock of The Charles Schwab Corporation, the parent company of Schwab and the investment adviser.
3	The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

98 

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.

Barclays U.S. Aggregate Bond Index A broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-back securities (agency fixed-rate and hybrid ARM passthroughs), asset-backed securities, and commercial mortgage-backed securities.

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.”

An individual bond is subject to the credit risk of the issuer. Changes in interest rates can affect a bond’s market value prior to call or maturity. There is no guarantee that a bond’s yield to call or maturity will provide a positive return over the rate of inflation.

bond fund A bond fund is subject to the same credit, interest rate, and inflation risks as bonds. In addition, a bond fund incurs ongoing fees and expenses. A bond fund’s net asset value will fluctuate with the price of the underlying bonds and the portfolio turnover activity; return of principal is not guaranteed.

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.

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.

MSCI EAFE Index A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada.

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.

Russell 2000 Index An index that measures the performance of the small-cap segment of the U.S. equity universe.

S&P 500 Index A market capitalization index that is designed to measure the performance of 500 leading publicly held companies in leading industries of the U.S. economy.

stock A share of ownership, or equity, in the issuing company.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

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.

99

Notes

Notes

Notes

Schwab Funds^® offers you an extensive family of mutual funds, each one based on a clearly defined investment approach and using disciplined management strategies. The list at right shows all currently available Schwab Funds.

Whether you are an experienced investor or just starting out, Schwab Funds can help you achieve your financial goals. An investor should consider a fund’s investment objectives, risks, charges and expenses carefully before investing or sending money. This and other important information can be found in the fund’s prospectus. Please call 1-800-435-4000 for a prospectus and brochure for any Schwab Fund. Please read the prospectus carefully before you invest. This report must be preceded or accompanied by a current prospectus.

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting Schwab’s website at www.schwabfunds.com/prospectus, the SEC’s website at http://www.sec.gov, or by contacting Schwab Funds at 1-800-435-4000.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.schwabfunds.com/prospectus or the SEC’s website at http://www.sec.gov.

The Schwab Funds Family^®

Stock Funds

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core Equity Fund

Schwab Fundamental US Large Company Index Fund

Schwab Fundamental US Small Company Index Fund

Schwab Fundamental International Large Company Index Fund

Schwab Fundamental International Small Company Index Fund

Schwab Fundamental Emerging Markets Large Company Index Fund

Schwab Global Real Estate Fund^tm

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market Index Fund^®

Schwab International Index Fund^®

Asset Allocation Funds

Schwab Balanced Fund^tm

Schwab MarketTrack All Equity Portfolio^tm

Schwab MarketTrack Growth Portfolio^tm

Schwab MarketTrack Balanced Portfolio^tm

Schwab MarketTrack Conservative Portfolio^tm

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

Schwab^® Monthly Income Fund – Moderate Payout

Schwab^® Monthly Income Fund – Enhanced Payout

Schwab^® Monthly Income Fund – Maximum Payout

Bond Funds

Schwab Short-Term Bond Market Fund^tm

Schwab Intermediate-Term Bond Fund^tm

Schwab Total Bond Market Fund^tm

Schwab GNMA Fund^tm

Schwab^® Treasury Inflation Protected Securities Index Fund

Schwab Tax-Free Bond Fund^tm

Schwab California Tax-Free Bond Fund^tm

Schwab Money Funds

Schwab offers an array of money market funds¹. Choose from taxable or tax-advantaged alternatives. Many can be linked to your eligible Schwab account to “sweep” cash balances automatically, subject to availability, when you’re between investments. Or, for your larger cash reserves, choose one of our Value Advantage Investments^®.

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.

Investment Adviser

Charles Schwab Investment Management, Inc.

211 Main Street, San Francisco, CA 94105

Funds

Schwab Funds^®

P.O. Box 3812, Englewood, CO 80155–3812

This report is not authorized for distribution to prospective investors

unless preceded or accompanied by a current prospectus.

^© 2013 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR27230-10

00098634

Semiannual report dated April 30, 2013, enclosed.

Schwab Fundamental Index* Funds

Schwab Fundamental

US Large Company Index Fund

Schwab Fundamental

US Small Company Index Fund

Schwab Fundamental

International Large Company

Index Fund

Schwab Fundamental

International Small Company Index Fund

Schwab Fundamental

Emerging Markets Large Company Index Fund

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* SCHWAB is a registered trademark of Charles Schwab & Co., Inc. FUNDAMENTAL INDEX is a registered trademark of Research Affiliates LLC.

This wrapper is not part of the shareholder report.

Schwab Fundamental Index* Funds

Semiannual Report

April 30, 2013

Schwab Fundamental

US Large Company Index Fund

Schwab Fundamental

US Small Company Index Fund

Schwab Fundamental

International Large Company

Index Fund

Schwab Fundamental

International Small Company Index Fund

Schwab Fundamental

Emerging Markets Large Company Index Fund

* SCHWAB is a registered trademark of Charles Schwab & Co., Inc. FUNDAMENTAL INDEX is a registered trademark of Research Affiliates LLC.

This page is intentionally left blank.

Schwab Fundamental Index Funds

In This Report

Performance at a Glance	2
From the President	3
Fund Management	5
Performance and Fund Facts
Schwab Fundamental US Large Company Index Fund	6
Schwab Fundamental US Small Company Index Fund	7
Schwab Fundamental International Large Company Index Fund	8
Schwab Fundamental International Small Company Index Fund	10
Schwab Fundamental Emerging Markets Large Company Index Fund	12
Fund Expenses	14
Financial Statements and Portfolio Holdings
Schwab Fundamental US Large Company Index Fund	15
Schwab Fundamental US Small Company Index Fund	22
Schwab Fundamental International Large Company Index Fund	29
Schwab Fundamental International Small Company Index Fund	38
Schwab Fundamental Emerging Markets Large Company Index Fund	47
Financial Notes	54
Trustees and Officers	64
Glossary	67

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM).
Distributor: Charles Schwab & Co., Inc. (Schwab).

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS), which was developed by, and is the exclusive property of, MSCI and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the schedules of Portfolio Holdings are sub-categories of Sector classifications.

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 2013
Schwab Fundamental US Large Company Index Fund (Ticker Symbol: SFLNX)	16.85%
Russell Fundamental U.S. Large Company Index	17.11%
Performance Details	page 6
Schwab Fundamental US Small Company Index Fund (Ticker Symbol: SFSNX)	18.61%
Russell Fundamental U.S. Small Company Index	18.79%
Performance Details	page 7
Schwab Fundamental International Large Company Index Fund1 (Ticker Symbol: SFNNX)	15.31%
Russell Fundamental Developed ex-U.S. Large Company Index (Net)	15.65%
Performance Details	pages 8-9
Schwab Fundamental International Small Company Index Fund1 (Ticker Symbol: SFILX)	18.55%
Russell Fundamental Developed ex-U.S. Small Company Index (Net)	19.07%
Performance Details	pages 10-11
Schwab Fundamental Emerging Markets Large Company Index Fund1 (Ticker Symbol: SFENX)	3.05%
Russell Fundamental Emerging Markets Large Company Index (Net)	3.23%
Performance Details	pages 12-13

Minimum Initial Investment² $ 100

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Index ownership— each of the names identifying the Russell Fundamental Indexes is a joint trademark of Russell Investments (“Russell”) and Research Affiliates LLC (“RA”) and is used by the fund under license. “Research Affiliates” and “Fundamental Index” are trademarks of RA. Subject to RA’s intellectual property rights in certain content, Russell is the owner of all copyrights related to the Russell Fundamental Indexes. Russell is the owner of the trademarks and copyrights related to the Russell Indexes. The Schwab Fundamental Index Funds are not sponsored, endorsed, sold or promoted by Russell or RA, and Russell and RA do not make any representation regarding the advisability of investing in shares of the fund.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

1	The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations, see financial note 2 for more information.
2	Please see the funds’ prospectus for further detail and eligibility requirements.

2 Schwab Fundamental Index Funds

From the President

Marie Chandoha is President and CEO of Charles Schwab Investment Management, Inc. and the funds covered in this report.

Dear Shareholder,

As President and CEO of Charles Schwab Investment Management, Inc., I’d like to thank you for trusting us to help you meet your investment goals, and for reading this important report concerning the Schwab Fundamental Index Funds. Fundamental Index strategies have enjoyed significant asset growth in recent years, as investors have embraced the value of alternative strategies to traditional index funds. While equity indices are often weighted by market capitalization, fundamental indices select and weight stocks by non-price measures. By using this methodology, the funds seek to offset certain risks of traditional index products, while offering the potential for higher returns.

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets, and comparatively modest performances by stocks in emerging markets. The backdrop for these performances included efforts undertaken by the Federal Reserve and many central banks around the world to stimulate faster economic growth by keeping interest rates low. This was particularly the case in Japan, where aggressive central bank policies helped fuel a rally by stocks, while the yen depreciated sharply versus the U.S. dollar. In general, stocks benefited from these central bank policies and from reduced concerns about the euro zone’s sovereign debt crisis and the U.S. fiscal cliff.

Many major U.S. stock market indices finished at or near record highs. By comparison, stocks in emerging markets were held back by some signs of slowing economic growth in markets such as Brazil, India, and China. For the

 Asset Class Performance Comparison % returns during the report period

This graph compares the performance of various asset classes during the report period. Final performance figures for the period are in the key below.

	14.42%	S&P 500® Index: measures U.S. large-cap stocks
	16.58%	Russell 2000® Index: measures U.S. small-cap stocks
	17.18%	MSCI EAFE® Index (Gross): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	0.90%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.04%	Three-Month U.S. Treasury Bills (T-bills): measures short-term U.S. Treasury obligations

Index figures assume dividends and distributions were reinvested, and do not include trading and management costs, which would lower performance. Indices are unmanaged, do not incur management fees, costs and expenses, and you cannot invest in them directly. Remember that past performance is not an indication of future results.

Data source: Index provider websites and CSIM.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views and portfolio holdings may have changed since the report date.

Schwab Fundamental Index Funds 3

From the President continued

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets, and comparatively modest performances by stocks in emerging markets.

six months, the Russell Fundamental U.S. Large Company Index returned 17.1%, the Russell Fundamental Developed ex-U.S. Large Company index (net) returned 15.7%, and the Russell Fundamental Emerging Markets Large Company Index (net) returned 3.2%.

In an effort to provide additional value to shareholders, we recently announced a reduction in the expense limits of the Schwab Fundamental International Small Company Index Fund and of the Schwab Fundamental Emerging Markets Large Company Index Fund. For more information about these funds or our other Schwab Fundamental Index Funds, please continue reading this report. In addition, you can find answers to frequently asked questions and more details about the funds by visiting www.schwabfunds.com. We are also happy to hear from you at 1-800-435-4000.

Sincerely,

4 Schwab Fundamental Index Funds

Fund Management

	Agnes Hong, CFA, Managing Director and Head of Passive Equity Strategies, leads the portfolio management teams of Schwab’s index mutual funds and equity ETFs. She also has overall responsibility for all aspects of the management of the funds. Prior to joining CSIM in 2009, Ms. Hong spent five years as a portfolio manager at Barclays Global Investors (subsequently acquired by BlackRock), where she managed institutional index funds and quantitative active funds. Prior to that, Ms. Hong worked in management consulting and product management, servicing global financial services clients.
	Ferian Juwono, CFA, Managing Director and Senior Portfolio Manager, is responsible for the day-to-day co-management of the funds. Prior to joining CSIM in 2010, Mr. Juwono worked at BlackRock (formerly Barclays Global Investors), where he spent over three years as a portfolio manager, managing equity index funds for institutional clients, and nearly two years as a senior business analyst. Prior to that, Mr. Juwono worked for over four years as a senior financial analyst with Union Bank of California.
	Ron Toll, Portfolio Manager, is responsible for the day-to-day co-management of the funds. Mr. Toll has been a portfolio manager with CSIM since 2007, and has held a number of positions at the firm since beginning his tenure in 1998. His previous roles include serving as a manager in Portfolio Operations, and as a manager in Portfolio Operations and Analytics.

Schwab Fundamental Index Funds 5

Schwab Fundamental US Large Company Index Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Fundamental US Large Company Index Fund (4/2/07)		16.85	%		21.24	%		7.54	%		5.38	%
Russell Fundamental U.S. Large Company Index4		17.11	%		21.35	%		n/a			n/a
Fundamental US Large Company Spliced Index5		17.11	%		21.76	%		7.67	%		5.53	%
FTSE RAFI US 1000 Index®		17.90	%		22.52	%		7.80	%		5.64	%

Fund Expense Ratios⁶: Net 0.35%; Gross 0.44%

 Statistics

Number of Holdings	616
Weighted Average Market Cap ($ x 1,000,000)	$95,254
Price/Earnings Ratio (P/E)	17.4
Price/Book Ratio (P/B)	2.1
Portfolio Turnover Rate7	5%

 Sector Weightings % of Investments

Energy	14.8%
Financials	14.6%
Consumer Discretionary	12.0%
Information Technology	12.0%
Consumer Staples	11.7%
Health Care	10.8%
Industrials	10.3%
Utilities	4.4%
Telecommunication Services	4.2%
Materials	3.3%
Other	1.9%
Total	100.0%

 Top Equity Holdings % of Net Assets⁸

Exxon Mobil Corp.	4.5%
Chevron Corp.	2.5%
AT&T, Inc.	2.0%
Bank of America Corp.	1.8%
Microsoft Corp.	1.8%
ConocoPhillips	1.7%
The Procter & Gamble Co.	1.6%
Verizon Communications, Inc.	1.5%
General Electric Co.	1.4%
Wal-Mart Stores, Inc.	1.4%
Total	20.2%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Index ownership— “Russell Fundamental U.S. Large Company Index” is a joint trademark of Russell Investments (“Russell”) and Research Affiliates LLC (“RA”) and is used by the fund under license. “Research Affiliates” and “Fundamental Index” are trademarks of RA. Subject to RA’s intellectual property rights in certain content, Russell is the owner of all copyrights related to the Russell Fundamental Indexes. FTSE is a trademark owned by the London Stock Exchange Plc and is used by FTSE International Limited under license. Schwab Fundamental Index Funds are not sponsored, endorsed, sold or promoted by Russell, FTSE or RA, and Russell, FTSE and RA do not make any representation regarding the advisability of investing in shares of the fund.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 27, 2009, the Investor Share class, Select Share class and Institutional Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 27, 2009 is that of the fund’s former Institutional Shares.
4	Effective October 19, 2012, the fund’s benchmark was changed from the FTSE RAFI US 1000 Index to the Russell Fundamental U.S. Large Company Index. See Glossary for index definitions.
5	The Fundamental U.S. Large Company Spliced Index is an internally calculated index, comprised of the FTSE RAFI US 1000 Index from inception of the fund until the close of business on October 18, 2012 and the Russell Fundamental U.S. Large Company Index from October 19, 2012 forward.
6	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
7	Not annualized.
8	This list is not a recommendation of any security by the investment adviser.

6 Schwab Fundamental Index Funds

Schwab Fundamental US Small Company Index Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Fundamental US Small Company Index Fund (4/2/07)		18.61	%		18.84	%		9.70	%		6.26	%
Russell Fundamental U.S. Small Company Index4		18.79	%		19.41	%		n/a			n/a
Fundamental US Small Company Spliced Index5		18.79	%		19.00	%		10.40	%		6.86	%
FTSE RAFI US Mid Small 1500 Index®		17.63	%		18.80	%		10.37	%		6.83	%

Fund Expense Ratios⁶: Net 0.35%; Gross 0.50%

 Statistics

Number of Holdings	887
Weighted Average Market Cap ($ x 1,000,000)	$3,268
Price/Earnings Ratio (P/E)	40.7
Price/Book Ratio (P/B)	1.9
Portfolio Turnover Rate7	12%

 Sector Weightings % of Investments

Financials	20.7%
Consumer Discretionary	19.0%
Industrials	18.6%
Information Technology	12.9%
Energy	6.6%
Materials	6.2%
Health Care	6.1%
Utilities	3.8%
Consumer Staples	3.7%
Telecommunication Services	1.2%
Other	1.2%
Total	100.0%

 Top Equity Holdings % of Net Assets⁸

Exterran Holdings, Inc.	0.3%
PulteGroup, Inc.	0.3%
First Solar, Inc.	0.3%
Covance, Inc.	0.3%
Eaton Vance Corp.	0.3%
SkyWest, Inc.	0.3%
EQT Corp.	0.3%
Old Republic International Corp.	0.3%
Vectren Corp.	0.3%
Health Management Associates, Inc., Class A	0.3%
Total	3.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Index ownership— “Russell Fundamental U.S. Small Company Index” is a joint trademark of Russell Investments (“Russell”) and Research Affiliates LLC (“RA”) and is used by the fund under license. “Research Affiliates” and “Fundamental Index” are trademarks of RA. Subject to RA’s intellectual property rights in certain content, Russell is the owner of all copyrights related to the Russell Fundamental Indexes. FTSE is a trademark owned by the London Stock Exchange Plc and is used by FTSE International Limited under license. Schwab Fundamental Index Funds are not sponsored, endorsed, sold or promoted by Russell, FTSE or RA, and Russell, FTSE and RA do not make any representation regarding the advisability of investing in shares of the fund.

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Small-company stocks are subject to greater volatility than other asset classes.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 27, 2009, the Investor Share class, Select Share class and Institutional Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 27, 2009 is that of the fund’s former Institutional Shares.
4	Effective October 19, 2012, the fund’s benchmark was changed from the FTSE RAFI US Mid Small 1500 Index to the Russell Fundamental U.S. Small Company Index. See Glossary for index definitions.
5	The Fundamental U.S. Small Company Spliced Index is an internally calculated index, comprised of the FTSE RAFI US Mid Small 1500 Index from inception of the fund until the close of business on October 18, 2012 and the Russell Fundamental U.S. Small Company Index from October 19, 2012 forward.
6	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
7	Not annualized.
8	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds 7

Schwab Fundamental International Large Company Index Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Fundamental International Large Company Index Fund (4/2/07)		15.31	%		17.44	%		-1.13	%		-0.61	%
Russell Fundamental Developed ex-U.S. Large Company Index (Net)4		15.65	%		17.30	%		n/a			n/a
Fundamental Developed ex-US Large Company Spliced Index5		15.65	%		18.08	%		-0.51	%		0.35	%
FTSE RAFI Developed ex US 1000 Index®		15.77	%		18.53	%		-0.44	%		0.41	%

Fund Expense Ratios⁶: Net 0.36%; Gross 0.57%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

The fund’s performance relative to the index may be affected by fair-value pricing, see financial note 2 for more information.

Index ownership— “Russell Fundamental Developed ex-U.S. Large Company Index” is a joint trademark of Russell Investments (“Russell”) and Research Affiliates LLC (“RA”) and is used by the fund under license. “Research Affiliates” and “Fundamental Index” are trademarks of RA. Subject to RA’s intellectual property rights in certain content, Russell is the owner of all copyrights related to the Russell Fundamental Indexes. FTSE is a trademark owned by the London Stock Exchange Plc and is used by FTSE International Limited under license. Schwab Fundamental Index Funds are not sponsored, endorsed, sold or promoted by Russell, FTSE or RA, and Russell, FTSE and RA do not make any representation regarding the advisability of investing in shares of the fund.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 19, 2009, the Investor Share class, Select Share class and Institutional Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 19, 2009 is that of the fund’s former Institutional Shares.
4	Effective October 19, 2012, the fund’s benchmark was changed from the FTSE RAFI Developed ex-US 1000 Index to the Russell Fundamental Developed ex-U.S. Large Company Index (Net). See Glossary for index definitions.
5	The Fundamental Developed ex-U.S. Large Company Spliced Index is an internally calculated index, comprised of the FTSE RAFI Developed ex-US 1000 Index (Net) from inception of the fund until the close of business on October 18, 2012 and the Russell Fundamental Developed ex-U.S. Large Company Index (Net) from October 19, 2012 forward.
6	As stated in the prospectus. Includes acquired fund fees and expenses incurred indirectly by the fund through its investments in other investment companies. The annualized weighted average expense ratio of these investment companies was 0.01%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.

8 Schwab Fundamental Index Funds

 Schwab Fundamental International Large Company Index Fund

Performance and Fund Facts as of 04/30/13 continued

 Statistics

Number of Holdings	803
Weighted Average Market Cap ($ x 1,000,000)	$51,816
Price/Earnings Ratio (P/E)	64.0
Price/Book Ratio (P/B)	0.8
Portfolio Turnover Rate1	8%

 Sector Weightings % of Investments

Financials	19.8%
Energy	12.4%
Industrials	11.8%
Consumer Discretionary	10.8%
Consumer Staples	8.9%
Materials	8.6%
Telecommunication Services	8.0%
Health Care	6.3%
Utilities	6.1%
Information Technology	4.7%
Other	2.6%
Total	100.0%

 Top Equity Holdings % of Net Assets²

BP plc	2.4%
Total S.A.	1.7%
Royal Dutch Shell plc, A Shares	1.6%
HSBC Holdings plc	1.5%
Vodafone Group plc	1.3%
Royal Dutch Shell plc, B Shares	1.2%
Toyota Motor Corp.	1.1%
Nestle S.A. – Reg’d	1.1%
Telefonica S.A.	1.0%
Banco Santander S.A.	1.0%
Total	13.9%

 Country Weightings % of Investments

Japan	20.8%
United Kingdom	17.4%
France	10.7%
Germany	8.7%
Canada	5.7%
Switzerland	5.6%
Netherlands	5.4%
Australia	4.9%
Spain	4.0%
Italy	3.9%
Other Countries	12.9%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Not annualized.
2	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds 9

Schwab Fundamental International Small Company Index Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Fundamental International Small Company Index Fund (1/31/08)		18.55	%		17.39	%		4.18	%		4.99	%
Russell Fundamental Developed ex-U.S. Small Company Index (Net)4		19.07	%		18.59	%		n/a			n/a
Fundamental Developed ex-US Small Company Spliced Index5		19.07	%		17.94	%		5.65	%		6.74	%
FTSE RAFI Developed ex US Mid Small 1500 Index®		16.06	%		15.21	%		5.16	%		6.26	%

Fund Expense Ratios⁶: Net 0.55%; Gross 0.92%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

The fund’s performance relative to the index may be affected by fair-value pricing, see financial note 2 for more information.

Index ownership— “Russell Fundamental Developed ex-U.S. Small Company Index” is a joint trademark of Russell Investments (“Russell”) and Research Affiliates LLC (“RA”) and is used by the fund under license. “Research Affiliates” and “Fundamental Index” are trademarks of RA. Subject to RA’s intellectual property rights in certain content, Russell is the owner of all copyrights related to the Russell Fundamental Indexes. FTSE is a trademark owned by the London Stock Exchange Plc and is used by FTSE International Limited under license. Schwab Fundamental Index Funds are not sponsored, endorsed, sold or promoted by Russell, FTSE or RA, and Russell, FTSE and RA do not make any representation regarding the advisability of investing in shares of the fund.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 19, 2009, the Investor Share class, Select Share class and Institutional Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 19, 2009 is that of the fund’s former Institutional Shares.
4	Effective October 19, 2012, the fund’s benchmark was changed from the FTSE RAFI Developed ex-US Mid Small 1500 Index to the Russell Fundamental Developed ex-US Small Company Index (Net). See Glossary for index definitions.
5	The Fundamental Developed ex-US Small Co. Spliced Index is an internally calculated index, comprised of the FTSE RAFI Developed ex-US Mid Small 1500 Index (Net) from inception of the fund until the close of business on October 18, 2012 and the Russell Fundamental Developed ex-US Small Company Index (Net) from October 19, 2012 forward.
6	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.

10 Schwab Fundamental Index Funds

 Schwab Fundamental International Small Company Index Fund

Performance and Fund Facts as of 04/30/13 continued

 Statistics

Number of Holdings	1,263
Weighted Average Market Cap ($ x 1,000,000)	$3,443
Price/Earnings Ratio (P/E)	110.6
Price/Book Ratio (P/B)	1.3
Portfolio Turnover Rate1	13%

 Sector Weightings % of Investments

Industrials	23.3%
Consumer Discretionary	18.6%
Financials	17.9%
Materials	9.4%
Information Technology	8.4%
Consumer Staples	6.9%
Health Care	4.3%
Energy	3.7%
Utilities	2.3%
Telecommunication Services	1.1%
Other	4.1%
Total	100.0%

 Top Equity Holdings % of Net Assets²

iShares MSCI EAFE Small Cap Index Fund	0.9%
Aiful Corp.	0.3%
Tokyu Land Corp.	0.3%
Hino Motors Ltd.	0.3%
Gamesa Corp. Tecnologica S.A.	0.2%
SBI Holdings, Inc.	0.2%
Shinsei Bank Ltd.	0.2%
Sumitomo Mitsui Trust Holdings, Inc.	0.2%
International Consolidated Airlines Group S.A.	0.2%
Teleperformance	0.2%
Total	3.0%

 Country Weightings % of Investments

Japan	37.1%
United Kingdom	12.4%
Canada	7.5%
France	4.9%
Australia	4.8%
Germany	3.5%
Hong Kong	3.0%
Italy	2.8%
Switzerland	2.6%
Other Countries	21.4%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Small-company stocks are subject to greater volatility than other asset classes.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Not annualized.
2	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds 11

Schwab Fundamental Emerging Markets Large Company Index Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2,3

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Fundamental Emerging Markets Large Company Index Fund (1/31/08)		3.05	%		0.11	%		-1.12	%		0.75	%
Russell Fundamental Emerging Markets Large Company Index (Net)4		3.23	%		1.18	%		n/a			n/a
Fundamental Emerging Markets Large Company Spliced Index5		3.23	%		1.03	%		0.72	%		2.74	%
FTSE RAFI Emerging Index®		3.54	%		1.22	%		0.75	%		2.77	%

Fund Expense Ratios⁶: Net 0.61%; Gross 0.92%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

The fund’s performance relative to the index may be affected by fair-value pricing, see financial note 2 for more information.

Index ownership— “Russell Fundamental Emerging Markets Large Company Index” is a joint trademark of Russell Investments (“Russell”) and Research Affiliates LLC (“RA”) and is used by the fund under license. “Research Affiliates” and “Fundamental Index” are trademarks of RA. Subject to RA’s intellectual property rights in certain content, Russell is the owner of all copyrights related to the Russell Fundamental Indexes. FTSE is a trademark owned by the London Stock Exchange Plc and is used by FTSE International Limited under license. Schwab Fundamental Index Funds are not sponsored, endorsed, sold or promoted by Russell, FTSE or RA, and Russell, FTSE and RA do not make any representation regarding the advisability of investing in shares of the fund.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	On October 19, 2009, the Investor Share class, Select Share class and Institutional Share class were combined into a single class of shares of the fund. The performance history of the fund prior to October 19, 2009 is that of the fund’s former Institutional Shares.
4	Effective October 19, 2012, the fund’s benchmark was changed from the FTSE RAFI Emerging Index to the Russell Fundamental Emerging Markets Large Company Index (Net). See Glossary for index definitions.
5	The Fundamental Emerging Large Company Spliced Index is an internally calculated index, comprised of the FTSE RAFI Emerging Index (Net) from inception of the fund until the close of business on October 18, 2012 and the Russell Fundamental Emerging Markets Large Company Index (Net) from October 19, 2012 forward.
6	As stated in the prospectus. Includes acquired fund fees and expenses incurred indirectly by the fund through its investments in other investment companies. The annualized weighted average expense ratio of these investment companies was 0.01%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.

12 Schwab Fundamental Index Funds

 Schwab Fundamental Emerging Markets Large Company Index Fund

Performance and Fund Facts as of 04/30/13 continued

 Statistics

Number of Holdings	246
Weighted Average Market Cap ($ x 1,000,000)	$43,135
Price/Earnings Ratio (P/E)	14.7
Price/Book Ratio (P/B)	1.2
Portfolio Turnover Rate1	12%

 Sector Weightings % of Investments

Energy	25.3%
Financials	17.2%
Information Technology	15.8%
Materials	12.4%
Telecommunication Services	11.3%
Industrials	5.9%
Consumer Discretionary	5.1%
Utilities	3.3%
Consumer Staples	2.6%
Other	1.1%
Total	100.0%

 Top Equity Holdings % of Net Assets²

LUKOIL ADR	4.7%
Samsung Electronics Co., Ltd.	4.4%
Gazprom ADR	3.7%
Petroleo Brasileiro S.A.	2.1%
Taiwan Semiconductor Manufacturing Co., Ltd.	2.0%
Surgutneftegas ADR	1.9%
Petroleo Brasileiro S.A. – Petrobras	1.9%
China Mobile Ltd.	1.9%
China Construction Bank Corp., Class H	1.7%
POSCO	1.4%
Total	25.7%

 Country Weightings % of Investments

Republic of Korea	21.5%
Russia	14.7%
Taiwan	13.7%
Brazil	13.7%
China	11.0%
South Africa	6.6%
Mexico	4.1%
India	3.1%
Other Countries	11.6%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Foreign securities can involve risks such as political and economic instability and currency risk. These risks may be greater in emerging markets.

1	Not annualized.
2	This list is not a recommendation of any security by the investment adviser.

Schwab Fundamental Index Funds 13

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you incur two types of costs: transaction costs, such as redemption fees, and ongoing costs, such as management fees, transfer agent and shareholder services fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in a fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning November 1, 2012 and held through April 30, 2013.

Actual Return lines in the table below provide information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ¸ $1,000 = 8.6), then multiply the result by the number given for your fund or share class under the heading entitled “Expenses Paid During Period.”

Hypothetical Return lines in the table below provide information about hypothetical account values and hypothetical expenses based on a fund’s actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as redemption fees. If these transactional costs were included, your costs would have been higher.

					Ending
			Beginning		Account Value		Expenses Paid
	Expense Ratio1		Account Value		(Net of Expenses)		During Period2
	(Annualized)		at 11/1/12		at 4/30/13		11/1/12–4/30/13
Schwab Fundamental US Large Company Index Fund
Actual Return		0.35%	$	1,000	$	1,168.50	$	1.88
Hypothetical 5% Return		0.35%	$	1,000	$	1,023.06	$	1.76
Schwab Fundamental US Small Company Index Fund
Actual Return		0.35%	$	1,000	$	1,186.10	$	1.90
Hypothetical 5% Return		0.35%	$	1,000	$	1,023.06	$	1.76
Schwab Fundamental International Large Company Index Fund
Actual Return		0.32%	$	1,000	$	1,153.10	$	1.71
Hypothetical 5% Return		0.32%	$	1,000	$	1,023.21	$	1.61
Schwab Fundamental International Small Company Index Fund
Actual Return		0.43%	$	1,000	$	1,185.50	$	2.33
Hypothetical 5% Return		0.43%	$	1,000	$	1,022.66	$	2.16
Schwab Fundamental Emerging Markets Large Company Index Fund
Actual Return		0.51%	$	1,000	$	1,030.50	$	2.57
Hypothetical 5% Return		0.51%	$	1,000	$	1,022.27	$	2.56

1	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.
2	Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year.

14 Schwab Fundamental Index Funds

Schwab Fundamental US Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		10.76			9.51			9.05			7.63			6.47			10.75
Income (loss) from investment operations:
Net investment income (loss)		0.12			0.21			0.18			0.14			0.10			0.20
Net realized and unrealized gains (losses)		1.66			1.22			0.43			1.37			1.26			(4.38	)
Total from investment operations		1.78			1.43			0.61			1.51			1.36			(4.18	)
Less distributions:
Distributions from net investment income		(0.24	)		(0.18	)		(0.15	)		(0.09	)		(0.20	)		(0.09	)
Distributions from net realized gains		—			—			—			—			—			(0.01	)
Total distributions		(0.24	)		(0.18	)		(0.15	)		(0.09	)		(0.20	)		(0.10	)
Net asset value at end of period		12.30			10.76			9.51			9.05			7.63			6.47
Total return (%)		16.85	2		15.29			6.74			19.95			22.04			(39.22	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.35	3		0.32	4		0.35			0.35			0.35			0.35
Gross operating expenses		0.42	3		0.44			0.44			0.45			0.53			0.52
Net investment income (loss)		2.19	3		2.13			2.06			1.77			1.88			2.19
Portfolio turnover rate		5	2		32	5		11			27			28			26
Net assets, end of period ($ x 1,000,000)		2,616			1,960			1,490			1,019			663			277

* Unaudited.

¹ Effective October 27, 2009, the Investor Share class, the Select Share class and the Institutional Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Institutional Shares.

² Not annualized.

³ Annualized.

⁴ The ratio of net operating expenses would have been 0.35%, if voluntary waiver by CSIM had not been included.

⁵ Portfolio turnover would have been 12%, if rebalancing trades had not been included due to a change in the fund’s index.

See financial notes 15

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.9%	Common Stock		1,987,826,548		2,561,268,028
	1	.7%	Other Investment Company		43,824,432		43,824,432
	0	.2%	Short-Term Investment		4,602,621		4,602,621
	99	.8%	Total Investments		2,036,253,601		2,609,695,081
	0	.9%	Collateral Invested for Securities on Loan		23,531,749		23,531,749
	(0	.7)%	Other Assets and Liabilities, Net				(17,030,571	)
	100	.0%	Net Assets				2,616,196,259

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 97.9% of net assets
Automobiles & Components 0.9%
Other Securities				0.9		23,364,169
Banks 2.3%
Wells Fargo & Co.		600,825		0.9		22,819,333
Other Securities				1.4		36,622,663
				2.3		59,441,996
Capital Goods 7.5%
3M Co.		100,575		0.4		10,531,208
General Electric Co.		1,674,525		1.4		37,325,162
United Technologies Corp.		165,715		0.6		15,128,122
Other Securities				5.1		134,034,412
				7.5		197,018,904
Commercial & Professional Supplies 1.0%
Other Securities				1.0		25,346,260
Consumer Durables & Apparel 1.1%
Other Securities				1.1		27,874,488
Consumer Services 1.4%
McDonald’s Corp.		142,080		0.6		14,512,051
Other Securities				0.8		22,441,268
				1.4		36,953,319
Diversified Financials 7.0%
Bank of America Corp.		3,808,160		1.8		46,878,450
Citigroup, Inc.		687,533		1.2		32,080,290
JPMorgan Chase & Co.		709,942		1.3		34,794,257
The Charles Schwab Corp. (a)		148,715		0.1		2,522,206
The Goldman Sachs Group, Inc.		88,411		0.5		12,914,195
Other Securities				2.1		53,270,477
				7.0		182,459,875
Energy 14.8%
Chevron Corp.		526,805		2.5		64,275,478
ConocoPhillips		733,310		1.7		44,328,589
Exxon Mobil Corp.		1,332,584		4.5		118,586,650
Marathon Oil Corp.		374,690		0.5		12,241,122
Occidental Petroleum Corp.		131,970		0.5		11,779,642
Phillips 66		364,355		0.8		22,207,437
Valero Energy Corp.		428,725		0.7		17,286,192
Other Securities				3.6		95,964,953
				14.8		386,670,063
Food & Staples Retailing 4.3%
Costco Wholesale Corp.		102,415		0.4		11,104,858
CVS Caremark Corp.		343,235		0.8		19,969,412
Wal-Mart Stores, Inc.		479,925		1.4		37,299,771
Walgreen Co.		297,570		0.6		14,732,691
Other Securities				1.1		28,559,254
				4.3		111,665,986
Food, Beverage & Tobacco 5.1%
Altria Group, Inc.		384,180		0.5		14,026,412
Mondelez International, Inc., Class A		339,492		0.4		10,677,023
PepsiCo, Inc.		218,308		0.7		18,003,861
Philip Morris International, Inc.		166,720		0.6		15,936,765
The Coca-Cola Co.		337,930		0.5		14,304,577
Other Securities				2.4		60,146,495
				5.1		133,095,133
Health Care Equipment & Services 5.3%
UnitedHealth Group, Inc.		290,175		0.7		17,390,188
WellPoint, Inc.		252,770		0.7		18,431,988
Other Securities				3.9		103,487,444
				5.3		139,309,620
Household & Personal Products 2.2%
The Procter & Gamble Co.		528,395		1.6		40,564,884
Other Securities				0.6		18,429,041
				2.2		58,993,925
Insurance 4.3%
Berkshire Hathaway, Inc., Class B *		175,111		0.7		18,617,802

16 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
The Travelers Cos., Inc.		168,395		0.5		14,382,617
Other Securities				3.1		79,452,906
				4.3		112,453,325
Materials 3.3%
Other Securities				3.3		87,095,302
Media 4.1%
Comcast Corp., Class A		299,040		0.5		12,350,352
The Walt Disney Co.		290,050		0.7		18,226,742
Time Warner, Inc.		397,288		0.9		23,749,877
Other Securities				2.0		52,297,786
				4.1		106,624,757
Pharmaceuticals, Biotechnology & Life Sciences 5.4%
Amgen, Inc.		117,655		0.5		12,260,828
Johnson & Johnson		424,695		1.4		36,196,755
Merck & Co., Inc.		343,157		0.6		16,128,379
Pfizer, Inc.		1,156,899		1.3		33,631,054
Other Securities				1.6		43,799,565
				5.4		142,016,581
Real Estate 1.0%
Other Securities				1.0		26,152,170
Retailing 4.5%
Lowe’s Cos., Inc.		366,055		0.5		14,063,833
Target Corp.		191,595		0.5		13,518,943
The Home Depot, Inc.		243,596		0.7		17,867,766
Other Securities				2.8		73,722,948
				4.5		119,173,490
Semiconductors & Semiconductor Equipment 2.2%
Intel Corp.		1,008,610		0.9		24,156,209
Texas Instruments, Inc.		300,270		0.4		10,872,777
Other Securities				0.9		23,315,615
				2.2		58,344,601
Software & Services 5.7%
International Business Machines Corp.		155,095		1.2		31,412,941
Microsoft Corp.		1,392,415		1.8		46,088,936
Other Securities				2.7		71,115,996
				5.7		148,617,873
Technology Hardware & Equipment 4.1%
Cisco Systems, Inc.		872,765		0.7		18,258,244
Hewlett-Packard Co.		1,429,875		1.1		29,455,425
Other Securities				2.3		58,473,958
				4.1		106,187,627
Telecommunication Services 4.2%
AT&T, Inc.		1,373,185		2.0		51,439,510
Sprint Nextel Corp. *		1,662,600		0.4		11,721,330
Verizon Communications, Inc.		714,730		1.5		38,531,094
Other Securities				0.3		8,800,452
				4.2		110,492,386
Transportation 1.8%
Other Securities				1.8		46,496,288
Utilities 4.4%
Other Securities				4.4		115,419,890
Total Common Stock
(Cost $1,987,826,548)						2,561,268,028
Other Investment Company 1.7% of net assets
Money Market Funds 1.7%
State Street Institutional U.S. Government Money Market Fund		43,824,432		1.7		43,824,432
Total Other Investment Company
(Cost $43,824,432)						43,824,432
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investment 0.2% of net assets
U.S. Treasury Obligation 0.2%
Other Securities				0.2		4,602,621
Total Short-Term Investment
(Cost $4,602,621)						4,602,621
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 0.9% of net assets
State Street Institutional U.S. Government Money Market Fund		23,531,749		0.9		23,531,749
Total Collateral Invested for Securities on Loan
(Cost $23,531,749)						23,531,749
End of Collateral Invested for Securities on Loan.

At 04/30/13 tax basis cost of the fund’s investments was $2,056,974,209 and the unrealized appreciation and depreciation were $572,461,875 and ($19,741,003), respectively, with a net unrealized appreciation of $552,720,872.

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	All or a portion of this security is on loan.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

See financial notes 17

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		580		46,173,800		1,174,537

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$2,561,268,028		$—		$—		$2,561,268,028
Other Investment Company1		43,824,432		—		—		43,824,432
Short-Term Investments1		—		4,602,621		—		4,602,621
Total		$2,605,092,460		$4,602,621		$—		$2,609,695,081
Other Financial Instruments
Collateral Invested for Securities on Loan		$23,531,749		$—		$—		$23,531,749
Futures Contract2		1,174,537		—		—		1,174,537

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock		$170,860		$9,858		($10,637	)		$—		($170,081	)		$—		$—		$—
Total		$170,860		$9,858		($10,637	)		$—		($170,081	)		$—		$—		$—

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

18 See financial notes

 Schwab Fundamental US Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated issuers, at value (cost $2,385,956)		$2,522,206
Investments in unaffiliated issuers, at value (cost $2,033,867,645) including securities on loan of $23,491,164	+	2,607,172,875
Total investments, at value (cost $2,036,253,601)		2,609,695,081
Collateral invested for securities on loan		23,531,749
Receivables:
Fund shares sold		9,048,869
Dividends		2,356,144
Due from broker for futures		116,000
Income from securities on loan		42,442
Foreign tax reclaims		5,422
Interest		429
Prepaid expenses	+	15,843
Total assets		2,644,811,979
Liabilities
Collateral held for securities on loan		23,531,749
Payables:
Investment adviser and administrator fees		44,356
Shareholder service fees		76,367
Fund shares redeemed		4,167,652
Accrued expenses	+	795,596
Total liabilities		28,615,720
Net Assets
Total assets		2,644,811,979
Total liabilities	−	28,615,720
Net assets		$2,616,196,259
Net Assets by Source
Capital received from investors		2,109,263,373
Net investment income not yet distributed		9,378,497
Net realized capital losses		(77,153,787	)
Net unrealized capital gains		574,708,176
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$2,616,196,259		212,699,149			$12.30

See financial notes 19

 Schwab Fundamental US Large Company Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated issuer		$16,748
Dividends received from unaffiliated issuers (net of foreign withholding taxes of $14,545)		26,511,986
Interest		4,237
Securities on loan	+	329,710
Total investment income		26,862,681
Expenses
Investment adviser and administrator fees		2,527,536
Shareholder service fees		874,945
Index fee		617,889
Transfer agent fees		152,257
Shareholder reports		61,973
Portfolio accounting fees		42,236
Professional fees		37,871
Registration fees		29,781
Custodian fees		21,999
Trustees’ fees		8,846
Interest expense		45
Other expenses	+	20,380
Total expenses		4,395,758
Expense reduction by CSIM and its affiliates	−	690,200
Custody credits	−	21
Net expenses	−	3,705,537
Net investment income		23,157,144
Realized and Unrealized Gains (Losses)
Net realized losses on affiliated issuer		(51,082	)
Net realized gains on unaffiliated investments		5,671,678
Net realized gains on futures contracts	+	4,531,263
Net realized gains		10,151,859
Net unrealized gains on affiliated issuer		513,448
Net unrealized gains on unaffiliated investments		299,480,791
Net unrealized gains on futures contracts	+	1,556,212
Net unrealized gains	+	301,550,451
Net realized and unrealized gains		311,702,310
Increase in net assets resulting from operations		$334,859,454

20 See financial notes

 Schwab Fundamental US Large Company Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$23,157,144			$37,721,180
Net realized gains		10,151,859			38,504,726
Net unrealized gains	+	301,550,451			170,685,750
Increase in net assets from operations		334,859,454			246,911,656
Distributions to Shareholders
Distributions from net investment income		($42,909,493	)		($28,518,465	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			49,322,788		$576,933,433			67,538,254		$676,863,199
Shares reinvested			2,230,842		23,803,086			1,765,688		16,261,985
Shares redeemed	+		(20,915,636	)	(236,287,345	)		(43,856,574	)	(441,499,603	)
Net transactions in fund shares			30,637,994		$364,449,174			25,447,368		$251,625,581
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			182,061,155		$1,959,797,124			156,613,787		$1,489,778,352
Total increase	+		30,637,994		656,399,135			25,447,368		470,018,772
End of period			212,699,149		$2,616,196,259			182,061,155		$1,959,797,124
Net investment income not yet distributed					$9,378,497					$29,130,846

See financial notes 21

Schwab Fundamental US Small Company Index Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		10.31			10.11			10.10			7.88			6.30			10.36
Income (loss) from investment operations:
Net investment income (loss)		0.10			0.15			0.11			0.09			0.06			0.05
Net realized and unrealized gains (losses)		1.65			0.88			0.47			2.19			1.59			(4.04	)
Total from investment operations		1.75			1.03			0.58			2.28			1.65			(3.99	)
Less distributions:
Distributions from net investment income		(0.20	)		(0.12	)		(0.10	)		(0.06	)		(0.07	)		(0.06	)
Distributions from net realized gains		(0.84	)		(0.71	)		(0.47	)		—			—			(0.01	)
Total distributions		(1.04	)		(0.83	)		(0.57	)		(0.06	)		(0.07	)		(0.07	)
Net asset value at end of period		11.02			10.31			10.11			10.10			7.88			6.30
Total return (%)		18.61	2		11.37			5.55			29.07			26.68			(38.73	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.35	3		0.32	4		0.35			0.35			0.35			0.35
Gross operating expenses		0.48	3		0.50			0.50			0.53			0.60			0.71
Net investment income (loss)		1.89	3		1.46			1.18			1.03			1.00			1.44
Portfolio turnover rate		12	2		92	5		35			41			29			37
Net assets, end of period ($ x 1,000,000)		728			619			563			412			298			131

* Unaudited.

¹ Effective October 27, 2009, the Investor Share class, the Select Share class and the Institutional Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Institutional Shares.

² Not annualized.

³ Annualized.

⁴ The ratio of net operating expenses would have been 0.35%, if voluntary waiver by CSIM had not been included.

⁵ Portfolio turnover would have been 29%, if rebalancing trades had not been included due to a change in the fund’s index.

22 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	98	.6%	Common Stock		579,997,059		718,431,793
	0	.0%	Warrants		—		215
	1	.1%	Other Investment Company		7,889,934		7,889,934
	0	.1%	Short-Term Investment		681,920		681,920
	99	.8%	Total Investments		588,568,913		727,003,862
	2	.7%	Collateral Invested for Securities on Loan		19,734,121		19,734,121
	(2	.5)%	Other Assets and Liabilities, Net				(18,374,897	)
	100	.0%	Net Assets				728,363,086

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 98.6% of net assets
Automobiles & Components 1.3%
Other Securities				1.3		9,574,386
Banks 4.3%
CapitalSource, Inc.		193,200		0.2		1,729,140
Other Securities				4.1		29,367,591
				4.3		31,096,731
Capital Goods 11.2%
AMETEK, Inc.		40,300		0.2		1,640,613
Carlisle Cos., Inc.		26,900		0.2		1,745,003
Chicago Bridge & Iron Co., N.V., NY Shares		34,598		0.3		1,861,026
GATX Corp.		33,400		0.2		1,701,730
General Cable Corp. *		49,900		0.2		1,720,552
Navistar International Corp. *		50,200		0.2		1,662,624
Snap-on, Inc.		20,800		0.2		1,792,960
Other Securities				9.7		69,441,208
				11.2		81,565,716
Commercial & Professional Supplies 3.9%
Other Securities				3.9		28,680,173
Consumer Durables & Apparel 4.6%
Hanesbrands, Inc. *		34,200		0.2		1,715,472
KB Home		80,200		0.2		1,807,708
Lennar Corp., Class A		43,400		0.2		1,788,948
PulteGroup, Inc. *		98,900		0.3		2,075,911
PVH Corp.		14,889		0.2		1,718,340
Other Securities				3.5		24,264,419
				4.6		33,370,798
Consumer Services 5.2%
Caesars Entertainment Corp. (b)*		113,200		0.2		1,801,012
Domino’s Pizza, Inc.		32,200		0.2		1,777,440
Other Securities				4.8		34,286,942
				5.2		37,865,394
Diversified Financials 2.8%
Eaton Vance Corp.		49,700		0.3		1,982,036
SEI Investments Co.		57,900		0.2		1,659,414
Other Securities				2.3		17,051,535
				2.8		20,692,985
Energy 6.6%
EQT Corp.		26,100		0.3		1,960,632
Exterran Holdings, Inc. *		81,000		0.3		2,140,020
Oceaneering International, Inc.		24,900		0.2		1,747,233
Oil States International, Inc. *		20,400		0.3		1,822,944
Plains Exploration & Production Co. *		37,000		0.2		1,672,400
Superior Energy Services, Inc. *		67,800		0.3		1,870,602
Other Securities				5.0		36,716,899
				6.6		47,930,730
Food & Staples Retailing 1.3%
Other Securities				1.3		9,808,195
Food, Beverage & Tobacco 2.0%
Other Securities				2.0		14,690,037
Health Care Equipment & Services 4.4%
Health Management Associates, Inc., Class A *		166,300		0.3		1,910,787
Other Securities				4.1		30,131,810
				4.4		32,042,597
Household & Personal Products 0.4%
Other Securities				0.4		2,675,349
Insurance 4.8%
Allied World Assurance Co. Holdings AG		18,800		0.2		1,707,228
CNO Financial Group, Inc.		145,600		0.2		1,648,192
First American Financial Corp.		64,700		0.2		1,732,019
HCC Insurance Holdings, Inc.		44,100		0.3		1,878,660
Old Republic International Corp.		142,800		0.3		1,927,800

See financial notes 23

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Protective Life Corp.		50,100		0.3		1,906,806
StanCorp Financial Group, Inc.		38,000		0.2		1,640,840
The Hanover Insurance Group, Inc.		35,200		0.2		1,775,136
Other Securities				2.9		20,901,425
				4.8		35,118,106
Materials 6.1%
Crown Holdings, Inc. *		41,000		0.2		1,749,880
Rock-Tenn Co., Class A		17,600		0.2		1,762,464
Other Securities				5.7		41,287,106
				6.1		44,799,450
Media 2.1%
Other Securities				2.1		15,439,048
Pharmaceuticals, Biotechnology & Life Sciences 1.7%
Covance, Inc. *		27,300		0.3		2,035,488
Endo Health Solutions, Inc. *		47,200		0.2		1,729,408
Other Securities				1.2		8,787,106
				1.7		12,552,002
Real Estate 8.8%
General Growth Properties, Inc.		77,400		0.2		1,758,528
iStar Financial, Inc. *		162,400		0.3		1,896,832
Prologis, Inc.		41,900		0.2		1,757,705
The Macerich Co.		24,500		0.2		1,716,225
Other Securities				7.9		56,708,512
				8.8		63,837,802
Retailing 5.8%
OfficeMax, Inc.		149,700		0.2		1,723,047
Priceline.com, Inc. *		2,411		0.2		1,678,032
Other Securities				5.4		38,545,533
				5.8		41,946,612
Semiconductors & Semiconductor Equipment 3.4%
First Solar, Inc. *		44,100		0.3		2,053,296
Other Securities				3.1		22,684,813
				3.4		24,738,109
Software & Services 5.0%
Other Securities				5.0		36,479,185
Technology Hardware & Equipment 4.5%
NCR Corp. *		63,800		0.2		1,739,826
Sanmina Corp. *		130,600		0.2		1,648,172
Other Securities				4.1		29,265,064
				4.5		32,653,062
Telecommunication Services 1.2%
MetroPCS Communications, Inc. *		155,400		0.3		1,839,936
Other Securities				0.9		7,068,111
				1.2		8,908,047
Transportation 3.4%
Kansas City Southern		15,300		0.2		1,668,771
SkyWest, Inc.		138,300		0.3		1,979,073
Other Securities				2.9		20,982,774
				3.4		24,630,618
Utilities 3.8%
Vectren Corp.		51,300		0.3		1,926,828
Other Securities				3.5		25,409,833
				3.8		27,336,661
Total Common Stock
(Cost $579,997,059)						718,431,793
Warrants 0.0% of net assets
Energy 0.0%
Other Securities				0.0		215
Total Warrants
(Cost $—)						215
Other Investment Company 1.1% of net assets
Money Market Fund 1.1%
State Street Institutional U.S. Government Money Market Fund		7,889,934		1.1		7,889,934
Total Other Investment Company
(Cost $7,889,934)						7,889,934
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investment 0.1% of net assets
U.S. Treasury Obligation 0.1%
Other Securities				0.1		681,920
Total Short-Term Investment
(Cost $681,920)						681,920
End of Investments.
	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 2.7% of net assets
State Street Institutional U.S. Government Money Market Fund		19,734,121		2.7		19,734,121
Total Collateral Invested for Securities on Loan
(Cost $19,734,121)						19,734,121
End of Collateral Invested for Securities on Loan.

At 04/30/13 tax basis cost of the fund’s investments was $592,682,666 and the unrealized appreciation and depreciation

24 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

were $153,300,527 and ($18,979,331), respectively, with a net unrealized appreciation of $134,321,196.

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	All or a portion of this security is held as collateral for open futures contracts.
(b)	All or a portion of this security is on loan.
(c)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(d)	Illiquid security. At the period end, the value of these amounted to $215 or 0.0% of net assets.
(e)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
Russell 2000 Index, mini, Long, expires 06/21/13		90		8,505,900		137,312

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$718,431,793		$—		$—		$718,431,793
Warrants1		215		—		—		215
Other Investment Company1		7,889,934		—		—		7,889,934
Short-Term Investment1		—		681,920		—		681,920
Total		$726,321,942		$681,920		$—		$727,003,862
Other Financial Instruments
Collateral Invested for Securities on Loan		$19,734,121		$—		$—		$19,734,121
Futures Contract2		137,312		—		—		137,312

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock		$441,199		$—		($225,691	)		$—		($215,508	)		$—		$—		$—
Total		$441,199		$—		($225,691	)		$—		($215,508	)		$—		$—		$—

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 25

 Schwab Fundamental US Small Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $588,568,913) including securities on loan of $20,451,243		$727,003,862
Foreign currency, at value (cost $34)		30
Cash		893
Collateral invested for securities on loan		19,734,121
Receivables:
Fund shares sold		1,359,444
Dividends		524,397
Due from broker for futures		51,300
Income from securities on loan		51,056
Interest		60
Prepaid expenses	+	6,454
Total assets		748,731,617
Liabilities
Collateral held for securities on loan		19,734,121
Payables:
Investment adviser and administrator fees		10,451
Shareholder service fees		2,687
Fund shares redeemed		352,352
Accrued expenses	+	268,920
Total liabilities		20,368,531
Net Assets
Total assets		748,731,617
Total liabilities	−	20,368,531
Net assets		$728,363,086
Net Assets by Source
Capital received from investors		579,018,152
Net investment income not yet distributed		1,872,328
Net realized capital gains		8,567,163
Net unrealized capital gains		138,905,443
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$728,363,086		66,095,860			$11.02

26 See financial notes

 Schwab Fundamental US Small Company Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $26,444)		$7,043,162
Interest		1,483
Securities on loan	+	275,536
Total investment income		7,320,181
Expenses
Investment adviser and administrator fees		918,473
Shareholder service fees		282,146
Index fee		191,225
Transfer agent fees		53,428
Shareholder reports		40,141
Portfolio accounting fees		31,006
Professional fees		27,212
Registration fees		16,696
Custodian fees		11,791
Trustees’ fees		4,816
Interest expense		88
Other expenses	+	7,465
Total expenses		1,584,487
Expense reduction by CSIM and its affiliates	−	438,758
Custody credits	−	13
Net expenses	−	1,145,716
Net investment income		6,174,465
Realized and Unrealized Gains (Losses)
Net realized gains on investments		9,119,940
Net realized gains on futures contracts		1,737,111
Net realized losses on foreign currency transactions	+	(42	)
Net realized gains		10,857,009
Net unrealized gains on investments		94,662,329
Net unrealized gains on futures contracts		211,898
Net unrealized gains on foreign currency translations	+	9
Net unrealized gains	+	94,874,236
Net realized and unrealized gains		105,731,245
Increase in net assets resulting from operations		$111,905,710

See financial notes 27

 Schwab Fundamental US Small Company Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$6,174,465			$8,822,319
Net realized gains		10,857,009			56,145,986
Net unrealized gains (losses)	+	94,874,236			(4,154,550	)
Increase in net assets from operations		111,905,710			60,813,755
Distributions to Shareholders
Distributions from net investment income		(11,947,532	)		(6,659,188	)
Distributions from net realized gains	+	(50,580,880	)		(39,248,349	)
Total distributions		($62,528,412	)		($45,907,537	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			9,217,901		$95,079,993			15,451,067		$154,128,648
Shares reinvested			2,784,659		26,509,953			1,892,528		17,089,526
Shares redeemed	+		(5,915,561	)	(61,548,592	)		(13,017,996	)	(130,341,328	)
Net transactions in fund shares			6,086,999		$60,041,354			4,325,599		$40,876,846
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			60,008,861		$618,944,434			55,683,262		$563,161,370
Total increase	+		6,086,999		109,418,652			4,325,599		55,783,064
End of period			66,095,860		$728,363,086			60,008,861		$618,944,434
Net investment income not yet distributed					$1,872,328					$7,645,395

28 See financial notes

Schwab Fundamental International Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		7.16			7.26			8.09			7.69			6.01			11.40
Income (loss) from investment operations:
Net investment income (loss)		0.11			0.22			0.23			0.21			0.16			0.28
Net realized and unrealized gains (losses)		0.96			(0.08	)2		(0.85	)		0.41			1.81			(5.56	)
Total from investment operations		1.07			0.14			(0.62	)		0.62			1.97			(5.28	)
Less distributions:
Distributions from net investment income		(0.21	)		(0.24	)		(0.21	)		(0.22	)		(0.29	)		(0.09	)
Distributions from net realized gains		—			—			—			—			—			(0.02	)
Total distributions		(0.21	)		(0.24	)		(0.21	)		(0.22	)		(0.29	)		(0.11	)
Net asset value at end of period		8.02			7.16			7.26			8.09			7.69			6.01
Total return (%)		15.31	3		2.24			(7.88	)		8.27			34.89			(46.70	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.32	4,5		0.31	6		0.35			0.35			0.35			0.35
Gross operating expenses		0.52	4		0.56			0.57			0.61			0.76			0.74
Net investment income (loss)		2.96	4		3.58			3.24			2.70			2.80			3.41
Portfolio turnover rate		8	3		61	7		35			65			82			74
Net assets, end of period ($ x 1,000,000)		598			501			372			301			253			145

* Unaudited.

¹ Effective October 19, 2009, the Investor Share class, the Select Share class and the Institutional Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Institutional Shares.

² The per share amount does not accord with the change in aggregate gains and losses in securities during the period because of the timing of fund transactions in relation to fluctuating market values.

³ Not annualized.

⁴ Annualized.

⁵ The ratio of net operating expenses would have been 0.35%, if voluntary waiver by CSIM had not been included. See financial note 4.

⁶ The ratio of net operating expenses would have been 0.35%, if voluntary waiver by CSIM had not been included.

⁷ Portfolio turnover would have been 37%, if rebalancing trades had not been included due to a change in the fund’s index.

See financial notes 29

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.5%	Common Stock		505,169,197		576,984,942
	0	.4%	Preferred Stock		1,413,091		2,273,025
	0	.0%	Rights		91,567		4,776
	0	.2%	Other Investment Company		935,189		1,238,800
	2	.3%	Short-Term Investments		13,912,611		13,912,611
	99	.4%	Total Investments		521,521,655		594,414,154
	2	.4%	Collateral Invested for Securities on Loan		14,315,517		14,315,517
	(1	.8)%	Other Assets and Liabilities, Net				(10,726,220	)
	100	.0%	Net Assets				598,003,451

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 96.5% of net assets
Australia 4.8%
BHP Billiton Ltd.		94,505		0.5		3,177,160
Other Securities				4.3		25,720,442
				4.8		28,897,602
Austria 0.4%
Other Securities				0.4		2,455,369
Belgium 0.9%
Other Securities				0.9		5,543,356
Canada 5.7%
Other Securities				5.7		33,867,363
China 0.0%
Other Securities				0.0		883
Denmark 0.6%
Other Securities				0.6		3,905,615
Finland 1.3%
Nokia Oyj (c)		1,024,610		0.6		3,442,367
Other Securities				0.7		4,276,057
				1.3		7,718,424
France 10.7%
AXA S.A.		140,819		0.4		2,637,065
BNP Paribas S.A.		63,838		0.6		3,559,473
Carrefour S.A. (c)		86,575		0.4		2,571,202
Compagnie de Saint-Gobain		54,071		0.4		2,165,486
France Telecom S.A.		388,066		0.7		4,144,304
GDF Suez		123,976		0.4		2,658,082
Sanofi		44,417		0.8		4,802,167
Total S.A.		207,185		1.7		10,429,081
Vivendi S.A.		125,694		0.5		2,847,206
Other Securities				4.8		27,955,679
				10.7		63,769,745
Germany 8.3%
Allianz SE - Reg’d		27,253		0.7		4,031,278
BASF SE		49,103		0.8		4,596,658
Bayer AG - Reg’d		27,573		0.5		2,882,659
Daimler AG - Reg’d		74,452		0.7		4,127,995
Deutsche Bank AG - Reg’d		46,673		0.4		2,148,500
Deutsche Telekom AG - Reg’d		332,957		0.7		3,943,590
E.ON SE AG		224,172		0.7		4,071,085
RWE AG		59,895		0.4		2,158,572
Siemens AG - Reg’d		35,000		0.6		3,657,046
Other Securities				2.8		17,929,444
				8.3		49,546,827
Greece 0.5%
Other Securities				0.5		3,276,854
Hong Kong 0.8%
Other Securities				0.8		4,661,678
Ireland 0.7%
Other Securities				0.7		4,343,259
Israel 0.3%
Other Securities				0.3		1,740,855
Italy 3.9%
Enel S.p.A.		793,261		0.5		3,067,840
Eni S.p.A.		210,952		0.8		5,034,667
Intesa Sanpaolo S.p.A.		1,369,795		0.4		2,487,708
UniCredit S.p.A. *		630,986		0.6		3,297,935
Other Securities				1.6		9,494,151
				3.9		23,382,301
Japan 20.7%
Canon, Inc.		61,700		0.4		2,219,009
Honda Motor Co., Ltd.		81,600		0.5		3,256,041
Mitsubishi UFJ Financial Group, Inc.		374,134		0.4		2,538,439
Nippon Telegraph & Telephone Corp.		47,604		0.4		2,367,354

30 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Tokyo Electric Power Co., Inc. *		848,400		0.6		3,755,522
Toyota Motor Corp.		114,500		1.1		6,645,330
Other Securities				17.3		102,917,870
				20.7		123,699,565
Luxembourg 0.5%
Other Securities				0.5		2,764,228
Netherlands 5.4%
Royal Dutch Shell plc, A Shares		288,326		1.6		9,806,539
Royal Dutch Shell plc, B Shares		207,329		1.2		7,272,568
Other Securities				2.6		14,953,246
				5.4		32,032,353
New Zealand 0.1%
Other Securities				0.1		717,610
Norway 0.9%
Other Securities				0.9		5,112,535
Portugal 0.3%
Other Securities				0.3		1,672,457
Singapore 0.7%
Other Securities				0.7		4,056,698
Spain 3.9%
Banco Bilbao Vizcaya Argentaria S.A.		353,810		0.6		3,444,187
Banco Santander S.A.		817,742		1.0		5,905,362
Repsol S.A.		98,972		0.4		2,320,354
Telefonica S.A.		421,907		1.0		6,177,692
Other Securities				0.9		5,603,535
				3.9		23,451,130
Sweden 2.3%
Other Securities				2.3		14,006,800
Switzerland 5.5%
Nestle S.A. - Reg’d		89,906		1.1		6,411,417
Novartis AG - Reg’d		60,911		0.8		4,509,094
Roche Holding AG		13,929		0.6		3,486,991
Other Securities				3.0		18,711,810
				5.5		33,119,312
United Kingdom 17.3%
Anglo American plc		104,321		0.4		2,550,727
AstraZeneca plc		80,695		0.7		4,189,763
Barclays plc		872,569		0.7		3,893,818
BP plc		1,994,840		2.4		14,454,891
British American Tobacco plc		47,387		0.4		2,626,908
BT Group plc		515,966		0.4		2,218,462
GlaxoSmithKline plc		227,726		1.0		5,875,666
HSBC Holdings plc		823,137		1.5		9,014,986
Tesco plc		560,758		0.5		3,189,581
Vodafone Group plc		2,644,854		1.3		8,070,229
Other Securities				8.0		47,157,092
				17.3		103,242,123
Total Common Stock
(Cost $505,169,197)						576,984,942
Preferred Stock 0.4% of net assets
Germany 0.4%
Other Securities				0.4		2,215,922
Italy 0.0%
Other Securities				0.0		57,103
Total Preferred Stock
(Cost $1,413,091)						2,273,025
Rights 0.0% of net assets
Spain 0.0%
Other Securities				0.0		4,776
Total Rights
(Cost $91,567)						4,776
Other Investment Company 0.2% of net assets
United States 0.2%
Other Securities				0.2		1,238,800
Total Other Investment Company
(Cost $935,189)						1,238,800
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 2.3% of net assets
Time Deposits 2.2%
DNB
0.03%, 05/01/13		12,896,101		2.2		12,896,101
Other Securities				0.1		397,553
				2.2		13,293,654
U.S. Treasury Obligation 0.1%
Other Securities				0.1		618,957
Total Short-Term Investments
(Cost $13,912,611)						13,912,611
End of Investments.

See financial notes 31

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 2.4% of net assets
Wells Fargo Advantage Government Money Market Fund		14,315,517		2.4		14,315,517
Total Collateral Invested for Securities on Loan
(Cost $14,315,517)						14,315,517
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $543,623,583 unrealized appreciation and depreciation were $85,174,193 and ($34,383,622), respectively, with a net unrealized appreciation of $50,790,571.

At 04/30/13, the values of certain foreign securities held by the fund aggregating $539,526,468 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(b)	Illiquid security. At the period end, the value of these amounted to $152,316 or 0.0% of net assets.
(c)	All or a portion of this security is on loan.
(d)	The rate shown is the purchase yield.
(e)	All or a portion of this security is held as collateral for futures contracts.

ADR —	American Depositary Receipt
CVA —	Dutch Certificate
Reg’d —	Registered
REIT —	Real Estate Investment Trust
RSP —	Risparmio (Convertible Savings Shares)
SDR —	Swedish Depositary Receipt

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI EAFE, e-mini, Long, expires 06/21/13		150		13,056,000		478,064

32 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$256,275,066		$—		$256,275,066
Belgium		180,914		5,362,442		—		5,543,356
Canada		33,867,363		—		—		33,867,363
China		—		—		883		883
France		663,413		63,106,332		—		63,769,745
Greece		270,690		3,006,164		—		3,276,854
Ireland		1,165,334		3,177,925		—		4,343,259
Netherlands		440,300		31,592,053		—		32,032,353
Singapore		459,030		3,597,668		—		4,056,698
Spain		15,408		23,374,400		61,322		23,451,130
Sweden		379,769		13,627,031		—		14,006,800
Switzerland		1,790,537		31,328,775		—		33,119,312
United Kingdom		405,680		102,805,587		30,856		103,242,123
Preferred Stock1		—		2,273,025		—		2,273,025
Rights1		4,776		—		—		4,776
Other Investment Company1		1,238,800		—		—		1,238,800
Short-Term Investments1		—		13,912,611		—		13,912,611
Total		$40,882,014		$553,439,079		$93,061		$594,414,154
Other Financial Instruments
Collateral Invested for Securities on Loan		$14,315,517		$—		$—		$14,315,517
Futures Contract2		478,064		—		—		478,064

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance					Change in												Balance
	as of		Realized			Unrealized								Gross		Gross		as of
	October 31,		Gains			Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)			(Losses)			Purchases		Sales			in		out		2013
Common Stock
Canada		$—		($129,892	)		$129,892			$—		$—			$—		$—		$—
China		6,079		—			(5,196	)		—		—			—		—		883
Netherlands		—		—			(183,369	)		29,368		—			154,001		—		—
Spain		—		—			5,632			55,690		—			—		—		61,322
United Kingdom		—		(214,077	)		214,670			30,263		—			—		—		30,856
Preferred Stock																			—
United Kingdom		5,378		50			(63	)		—		(5,365	)		—		—		—
Rights				—
Hong Kong		30,003		43,202			(30,003	)		—		(43,202	)		—		—		—
Total		$41,460		($300,717	)		$131,563			$115,321		($48,567	)		$154,001		$—		$93,061

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The change in net unrealized gains (losses) for Level 3 investments held by the fund at April 30, 2013 was $1,029.

See financial notes 33

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were security transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013. The transfers in the amount of $827,623 and $247,129 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, were primarily due to the use of international fair valuation by the fund. The transfers in and out of Level 3 from Level 1 or Level 2 were the result of fair valued securities for which no quoted value was available.

34 See financial notes

 Schwab Fundamental International Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $521,521,655) including securities on loan of $13,225,367		$594,414,154
Foreign currency, at value (cost $45)		45
Collateral invested for securities on loan		14,315,517
Receivables:
Investments sold		275,015
Dividends		2,275,788
Fund shares sold		1,000,333
Foreign tax reclaims		315,493
Income from securities on loan		108,632
Due from broker for futures		12,000
Interest		11
Prepaid expenses	+	4,287
Total assets		612,721,275
Liabilities
Collateral held for securities on loan		14,315,517
Payables:
Investments bought		15,591
Investment adviser and administrator fees		6,814
Shareholder service fees		3,529
Fund shares redeemed		175,698
Accrued expenses	+	200,675
Total liabilities		14,717,824
Net Assets
Total assets		612,721,275
Total liabilities	−	14,717,824
Net assets		$598,003,451
Net Assets by Source
Capital received from investors		646,529,131
Net investment income not yet distributed		5,271,854
Net realized capital losses		(127,158,570	)
Net unrealized capital gains		73,361,036
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$598,003,451		74,555,864			$8.02

See financial notes 35

 Schwab Fundamental International Large Company Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $660,074)			$8,737,658
Interest			1,098
Securities on loan		+	198,923
Total investment income			8,937,679
Expenses
Investment adviser and administrator fees			797,309
Shareholder service fees			216,876
Index fee			155,806
Custodian fees			86,273
Transfer agent fees			44,200
Portfolio accounting fees			42,044
Professional fees			27,445
Registration fees			16,858
Shareholder reports			15,331
Trustees’ fees			4,447
Interest expense			246
Other expenses		+	19,829
Total expenses			1,426,664
Expense reduction by CSIM and its affiliates		−	545,331
Net expenses		−	881,333
Net investment income			8,056,346
Realized and Unrealized Gains (Losses)
Net realized losses on investments			(619,399	)
Net realized gains on futures contracts			360,548
Net realized losses on foreign currency transactions		+	(74,598	)
	��
Net realized losses			(333,449	)
Net unrealized gains on investments			70,584,299
Net unrealized gains on futures contracts			478,064
Net unrealized gains on foreign currency translations		+	16,048
Net unrealized gains		+	71,078,411
Net realized and unrealized gains			70,744,962
Increase in net assets resulting from operations			$78,801,308

36 See financial notes

 Schwab Fundamental International Large Company Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$8,056,346			$14,440,391
Net realized losses		(333,449	)		(12,889,488	)
Net unrealized gains	+	71,078,411			16,027,825
Increase in net assets from operations		78,801,308			17,578,728
Distributions to Shareholders
Distributions from net investment income		($15,274,655	)		($12,260,320	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			12,137,754		$90,676,370			35,480,423		$237,479,009
Shares reinvested			1,575,182		11,404,319			1,363,648		9,013,714
Shares redeemed	+		(9,094,862	)	(68,184,818	)		(18,197,244	)	(123,492,196	)
Net transactions in fund shares			4,618,074		$33,895,871			18,646,827		$123,000,527
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			69,937,790		$500,580,927			51,290,963		$372,261,992
Total increase	+		4,618,074		97,422,524			18,646,827		128,318,935
End of period			74,555,864		$598,003,451			69,937,790		$500,580,927
Net investment income not yet distributed					$5,271,854					$12,490,163

See financial notes 37

Schwab Fundamental International Small Company Index Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			1/31/082–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		9.13			9.53			9.96			9.00			6.22			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.10	3		0.21	3		0.24	3		0.16	3		0.12	3		0.27	3
Net realized and unrealized gains (losses)		1.55			0.03			(0.40	)		1.09			2.92			(4.05	)
Total from investment operations		1.65			0.24			(0.16	)		1.25			3.04			(3.78	)
Less distributions:
Distributions from net investment income		(0.30	)		(0.25	)		(0.27	)		(0.29	)		(0.26	)		—
Distributions from net realized gains		—			(0.39	)		—			—			—			—
Total distributions		(0.30	)		(0.64	)		(0.27	)		(0.29	)		(0.26	)		—
Net asset value at end of period		10.48			9.13			9.53			9.96			9.00			6.22
Total return (%)		18.55	4		3.13			(1.76	)		14.32			51.19			(37.80	)4
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.43	5,6,7		0.46	8,9		0.54			0.55			0.55			0.56	5,10
Gross operating expenses		0.97	5		0.92	9		0.99			1.07			3.82			5.44	5
Net investment income (loss)		2.18	5		2.42			2.29			1.77			1.59			3.55	5
Portfolio turnover rate		13	4		89	11		63			63			81			132	4
Net assets, end of period ($ x 1,000,000)		116			90			93			74			47			3

* Unaudited.

¹ Effective October 19, 2009, the Investor Share class, the Select Share class and the Institutional Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Institutional Shares.

² Commencement of operations.

³ Calculated based on the average shares outstanding during the period.

⁴ Not annualized.

⁵ Annualized.

⁶ The ratio of net operating expenses would have been 0.42%, if interest expenses had not been incurred.

⁷ The ratio of net operating expenses would have been 0.55%, if voluntary waiver by CSIM had not been included. See financial note 4.

⁸ The ratio of net operating expenses would have been 0.51%, if voluntary waiver by CSIM had not been included.

⁹ The net operating and gross operating expense ratios would have been 0.50% and 0.97%, respectively, if vendor payments had not been included.

¹⁰ The ratio of net operating expenses would have been 0.55%, if interest expenses had not been incurred.

¹¹ Portfolio turnover would have been 48%, if rebalancing trades had not been included due to a change in the fund’s index.

38 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.7%	Common Stock		94,108,625		111,781,464
	0	.5%	Preferred Stock		333,941		493,865
	0	.9%	Other Investment Companies		937,056		1,094,789
	3	.2%	Short-Term Investments		3,719,226		3,719,226
	101	.3%	Total Investments		99,098,848		117,089,344
	2	.8%	Collateral Invested for Securities on Loan		3,235,192		3,235,192
	(4	.1)%	Other Assets and Liabilities, Net				(4,717,877	)
	100	.0%	Net Assets				115,606,659

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 96.7% of net assets
Australia 4.8%
Goodman Fielder Ltd. *		237,979		0.2		191,367
Other Securities				4.6		5,347,795
				4.8		5,539,162
Austria 0.7%
Other Securities				0.7		865,763
Belgium 1.1%
Other Securities				1.1		1,227,198
Canada 7.6%
Atco Ltd., Class I		2,170		0.2		207,835
Superior Plus Corp.		15,800		0.2		203,881
West Fraser Timber Co., Ltd.		2,250		0.2		196,447
Other Securities				7.0		8,140,397
				7.6		8,748,560
Denmark 1.4%
Other Securities				1.4		1,653,945
Finland 1.8%
Other Securities				1.8		2,058,000
France 4.9%
Neopost S.A.		3,040		0.2		200,391
Technicolor - Reg’d *		51,690		0.2		215,440
Teleperformance		5,313		0.2		233,658
Other Securities				4.3		5,055,545
				4.9		5,705,034
Germany 3.1%
Other Securities				3.1		3,605,599
Greece 0.5%
Other Securities				0.5		563,023
Hong Kong 3.0%
New World Development Co., Ltd.		109,000		0.2		190,542
The Link REIT		34,000		0.2		192,739
Other Securities				2.6		3,128,783
				3.0		3,512,064
Ireland 0.9%
Grafton Group plc		32,799		0.2		228,582
Other Securities				0.7		754,802
				0.9		983,384
Israel 1.0%
Other Securities				1.0		1,192,459
Italy 2.9%
Other Securities				2.9		3,313,201
Japan 37.5%
Aiful Corp. *		31,750		0.3		362,746
Air Water, Inc.		12,000		0.2		194,307
Amada Co., Ltd.		28,000		0.2		224,679
Aoyama Trading Co., Ltd.		7,100		0.2		212,464
Chugai Pharmaceutical Co., Ltd.		8,000		0.2		199,178
Daicel Corp.		25,000		0.2		201,770
Haseko Corp. *		139,000		0.2		203,064
Hino Motors Ltd.		19,000		0.3		290,222
Hirose Electric Co., Ltd.		1,300		0.2		186,926
Hitachi Construction Machinery Co., Ltd.		8,500		0.2		202,202
Hokuhoku Financial Group, Inc.		87,000		0.2		203,022
IT Holdings Corp.		12,900		0.2		193,652
K’s Holdings Corp.		6,140		0.2		216,456
Kamigumi Co., Ltd.		20,000		0.2		187,535
Leopalace21 Corp. *		34,700		0.2		192,322
Mitsui Engineering & Shipbuilding Co., Ltd.		112,000		0.2		207,233
NGK Spark Plug Co., Ltd.		13,000		0.2		219,164
Nomura Research Institute Ltd.		7,000		0.2		210,859
Odakyu Electric Railway Co., Ltd.		16,000		0.2		192,688
SBI Holdings, Inc.		13,700		0.2		265,384
Shinsei Bank Ltd.		90,000		0.2		252,603
Sumitomo Forestry Co., Ltd.		16,700		0.2		199,056

See financial notes 39

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Sumitomo Mitsui Trust Holdings, Inc.		49,000		0.2		246,250
Sumitomo Rubber Industries Ltd.		12,300		0.2		227,120
The Daiei, Inc. *		58,600		0.2		230,343
The Yokohama Rubber Co., Ltd.		16,000		0.2		210,105
Tokyo Tatemono Co., Ltd.		25,000		0.2		231,701
Tokyu Land Corp.		25,000		0.3		307,377
TOTO Ltd.		21,000		0.2		217,798
Other Securities				31.4		36,912,409
				37.5		43,400,635
Luxembourg 0.5%
Other Securities				0.5		571,258
Netherlands 1.6%
Other Securities				1.6		1,868,941
New Zealand 0.4%
Other Securities				0.4		413,974
Norway 1.1%
Other Securities				1.1		1,265,019
Portugal 0.5%
Other Securities				0.5		591,608
Republic of Korea 0.0%
Other Securities				0.0		—
Singapore 1.8%
Jardine Cycle & Carriage Ltd.		5,000		0.2		198,172
Other Securities				1.6		1,841,962
				1.8		2,040,134
Spain 2.1%
Gamesa Corp. Tecnologica S.A.		72,453		0.2		283,262
Mapfre S.A.		58,093		0.2		212,769
Other Securities				1.7		1,885,923
				2.1		2,381,954
Sweden 2.3%
Other Securities				2.3		2,661,901
Switzerland 2.7%
Other Securities				2.7		3,114,767
United Kingdom 12.5%
Ashtead Group plc		24,522		0.2		224,265
Bellway plc		11,095		0.2		232,083
Berendsen plc		15,752		0.2		189,293
Booker Group plc		104,530		0.2		193,346
International Consolidated Airlines Group S.A. *		57,449		0.2		243,409
Invensys plc		35,509		0.2		212,594
Other Securities				11.3		13,208,891
				12.5		14,503,881
Total Common Stock
(Cost $94,108,625)						111,781,464
Preferred Stock 0.5% of net assets
Germany 0.5%
Other Securities				0.5		493,260
United Kingdom 0.0%
Other Securities				0.0		605
Total Preferred Stock
(Cost $333,941)						493,865
Other Investment Companies 0.9% of net assets
Australia 0.0%
Other Securities				0.0		47,599
United States 0.9%
iShares MSCI EAFE Small Cap Index Fund (a)		23,000		0.9		1,047,190
Total Other Investment Companies
(Cost $937,056)						1,094,789
	Face
Security	Amount		% of Net		Value
Rate, Maturity Date	($)		Assets		($)
Short-Term Investments 3.2% of net assets
Time Deposits 3.1%
Bank of Tokyo-Mitsubishi UFJ		3,433,129		3.0		3,433,129
Other Securities				0.1		109,118
				3.1		3,542,247
U.S. Treasury Obligation 0.1%
Other Securities				0.1		176,979
Total Short-Term Investments
(Cost $3,719,226)						3,719,226
End of Investments.

40 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net		Value
Security	of Shares		Assets		($)
Collateral Invested for Securities on Loan 2.8% of net assets
Wells Fargo Advantage Government Money Market Fund		3,235,192		2.8		3,235,192
Total Collateral Invested for Securities on Loan
(Cost $3,235,192)						3,235,192
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $99,772,946 and the unrealized appreciation and depreciation were $22,941,525 and ($5,625,127), respectively, with a net unrealized appreciation of $17,316,398.

At 04/30/13, the values of certain foreign securities held by the fund aggregating $96,271,539 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(c)	Illiquid security. At the period end, the value of these amounted to $21,629 or 0.0% of net assets.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.

ADR —	American Depositary Receipt
CVA —	Dutch Certificate
GDR —	Global Depositary Receipt
Reg’d —	Registered
REIT —	Real Estate Investment Trust
RSP —	Risparmio (Convertible Savings Shares)
SDR —	Swedish Depositary Receipt

In addition to the above the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI EAFE, e-mini, Long, expires 06/21/13		19		1,653,760		76,178

See financial notes 41

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$2,471,974		$—		$2,471,974
Australia		119,035		5,420,127		—		5,539,162
Austria		224,520		641,243		—		865,763
Belgium		620,391		606,807		—		1,227,198
Canada		8,748,560		—		—		8,748,560
Denmark		194,070		1,459,875		—		1,653,945
France		604,991		5,100,043		—		5,705,034
Germany		138,783		3,466,816		—		3,605,599
Greece		120,731		442,292		—		563,023
Hong Kong		48,246		3,463,818		—		3,512,064
Ireland		362,770		620,614		—		983,384
Israel		144,662		1,047,797		—		1,192,459
Italy		55,778		3,257,423		—		3,313,201
Japan		396,322		43,004,313		—		43,400,635
Luxembourg		224,441		346,817		—		571,258
Netherlands		224,789		1,644,152		—		1,868,941
Norway		123,791		1,141,228		—		1,265,019
Portugal		320,410		271,198		—		591,608
Republic of Korea		—		—		—		—
Singapore		49,395		1,969,110		21,629		2,040,134
Spain		94,104		2,234,075		53,775		2,381,954
Sweden		120,437		2,541,464		—		2,661,901
Switzerland		565,345		2,549,422		—		3,114,767
United Kingdom		2,426,210		12,077,671		—		14,503,881
Preferred Stock1		—		493,260		—		493,260
United Kingdom		—		—		605		605
Other Investment Companies1		1,094,789		—		—		1,094,789
Short-Term Investments1		—		3,719,226		—		3,719,226
Total		$17,022,570		$99,990,765		$76,009		$117,089,344
Other Financial Instruments
Collateral Invested for Securities on Loan		$3,235,192		$—		$—		$3,235,192
Futures Contract2		76,178		—		—		76,178

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

42 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance					Change in												Balance
	as of		Realized			Unrealized								Gross		Gross		as of
	October 31,		Gains			Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)			(Losses)			Purchases		Sales			in		out		2013
Common Stock
Netherlands		$4,930		($490	)		$4,828			$—		($9,268	)		$—		$—		$—
Singapore		27,299		—			(5,670	)		—		—			—		—		21,629
Spain		—		—			(2,956	)		45,129		—			11,602		—		53,775
Preferred Stock
United Kingdom		1,108		(9	)		(5	)		603		(1,092	)		—		—		605
Total		$33,337		($499	)		($3,803	)		$45,732		($10,360	)		$11,602		$—		$76,009

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The change in net unrealized gains (losses) for Level 3 investments held by the fund at April 30, 2013 was ($8,759).

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were security transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013. The transfers in the amount of $1,669,642 and $2,689,990 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, were primarily due to the use of international fair valuation by the fund. The transfers in and out of Level 3 from Level 1 or Level 2 were the result of fair valued securities for which no quoted value was available.

See financial notes 43

 Schwab Fundamental International Small Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $99,098,848) including securities on loan of $2,935,420		$117,089,344
Foreign currency, at value (cost $15)		15
Collateral invested for securities on loan		3,235,192
Receivables:
Dividends		516,025
Fund shares sold		303,745
Foreign tax reclaims		34,687
Income from securities on loan		15,742
Due from broker for futures		204
Due from investment adviser		46
Interest		3
Prepaid expenses	+	876
Total assets		121,195,879
Liabilities
Collateral held for securities on loan		3,235,192
Payables:
Investments bought		2,184,397
Shareholder service fees		1,414
Fund shares redeemed		72,065
Accrued expenses	+	96,152
Total liabilities		5,589,220
Net Assets
Total assets		121,195,879
Total liabilities	−	5,589,220
Net assets		$115,606,659
Net Assets by Source
Capital received from investors		101,803,080
Net investment income not yet distributed		172,221
Net realized capital losses		(4,432,242	)
Net unrealized capital gains		18,063,600
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$115,606,659		11,034,013			$10.48

44 See financial notes

 Schwab Fundamental International Small Company Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $104,958)		$1,268,450
Interest		427
Securities on loan	+	59,131
Total investment income		1,328,008
Expenses
Investment adviser and administrator fees		203,596
Shareholder service fees		35,652
Custodian fees		75,056
Index fee		44,631
Portfolio accounting fees		40,867
Professional fees		24,509
Transfer agent fees		23,728
Registration fees		11,126
Shareholder reports		10,271
Trustees’ fees		3,160
Interest expense		477
Other expenses	+	23,004
Total expenses		496,077
Expense reduction by CSIM and its affiliates	−	279,280
Net expenses	−	216,797
Net investment income		1,111,211
Realized and Unrealized Gains (Losses)
Net realized gains on investments		1,005,415
Net realized gains on futures contracts		154,750
Net realized losses on foreign currency transactions	+	(15,660	)
Net realized gains		1,144,505
Net unrealized gains on investments		15,324,607
Net unrealized gains on futures contracts		76,179
Net unrealized gains on foreign currency translations	+	1,970
Net unrealized gains	+	15,402,756
Net realized and unrealized gains		16,547,261
Increase in net assets resulting from operations		$17,658,472

See financial notes 45

 Schwab Fundamental International Small Company Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$1,111,211			$2,224,158
Net realized gains (losses)		1,144,505			(3,921,600	)
Net unrealized gains	+	15,402,756			3,995,812
Increase in net assets from operations		17,658,472			2,298,370
Distributions to Shareholders
Distributions from net investment income		(3,109,770	)		(2,493,429	)
Distributions from net realized gains	+	—			(3,900,690	)
Total distributions		($3,109,770	)		($6,394,119	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			2,308,937		$22,012,555			3,585,058		$31,904,834
Shares reinvested			227,023		2,068,185			531,718		4,487,698
Shares redeemed	+		(1,399,893	)	(13,362,145	)		(3,924,070	)	(34,465,493	)
Net transactions in fund shares			1,136,067		$10,718,595			192,706		$1,927,039
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			9,897,946		$90,339,362			9,705,240		$92,508,072
Total increase or decrease	+		1,136,067		25,267,297			192,706		(2,168,710	)
End of period			11,034,013		$115,606,659			9,897,946		$90,339,362
Net investment income not yet distributed					$172,221					$2,170,780

46 See financial notes

Schwab Fundamental Emerging Markets Large Company Index Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			1/31/082–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/091			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		8.86			9.17			10.81			8.91			5.74			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.06			0.25			0.24			0.17			0.05			0.16
Net realized and unrealized gains (losses)		0.21			(0.17	)		(1.37	)		1.81			3.27			(4.42	)
Total from investment operations		0.27			0.08			(1.13	)		1.98			3.32			(4.26	)
Less distributions:
Distributions from net investment income		(0.24	)		(0.22	)		(0.15	)		(0.08	)		(0.15	)		—
Distributions from net realized gains		—			(0.17	)		(0.36	)		—			—			—
Total distributions		(0.24	)		(0.39	)		(0.51	)		(0.08	)		(0.15	)		—
Net asset value at end of period		8.89			8.86			9.17			10.81			8.91			5.74
Total return (%)		3.05	3		1.18			(10.99	)		22.36			59.55			(42.60	)3
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		0.51	4,5		0.56	6		0.61	7		0.61	7		0.61	7		0.61	4,7
Gross operating expenses		0.88	4		0.91			0.91			0.98			1.70			4.06	4
Net investment income (loss)		1.28	4		2.75			2.51			2.31			1.56			2.31	4
Portfolio turnover rate		12	3		86	8		56			91			103			159	3
Net assets, end of period ($ x 1,000,000)		325			314			310			294			119			6

* Unaudited.

¹ Effective October 19, 2009, the Investor Share class, the Select Share and the Institutional Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Institutional Shares.

² Commencement of operations.

³ Not annualized.

⁴ Annualized.

⁵ The ratio of net operating expenses would have been 0.60%, if voluntary waiver by CSIM had not been included. See financial note 4.

⁶ The ratio of net operating expenses would have been 0.60%, if voluntary waiver by CSIM had not been included.

⁷ The ratio of net operating expenses would have been 0.60%, if interest expenses had not been incurred.

⁸ Portfolio turnover would have been 51%, if rebalancing trades had not been included due to a change in the fund’s index.

See financial notes 47

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows the fund’s 50 largest portfolio holdings in unaffiliated issuers and any holdings exceeding 1% of the fund’s total net assets as of the report date and any affiliated issuers. The remaining securities held by the fund are grouped as “Other Securities” in each category. You can request a complete schedule of portfolio holdings as of the report date, free of charge, by calling Schwab Funds^® at 1-800-435-4000. This complete schedule, filed on the fund’s Form N-CSR, is also available on the SEC’s website at http://www.sec.gov.

In addition, the fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. A copy of the fund’s most recently filed quarterly schedule of portfolio holdings, included on the fund’s Form N-CSR (with respect to the fund’s second and fourth fiscal quarters) or Form N-Q (with respect to the fund’s first and third fiscal quarters), is available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	90	.0%	Common Stock		286,472,038		292,368,067
	8	.7%	Preferred Stock		32,364,495		28,157,895
	0	.7%	Other Investment Company		2,399,360		2,380,950
	0	.4%	Short-Term Investments		1,212,180		1,212,180
	99	.8%	Total Investments		322,448,073		324,119,092
	0	.1%	Collateral Invested for Securities on Loan		284,700		284,700
	0	.1%	Other Assets and Liabilities, Net				203,046
	100	.0%	Net Assets				324,606,838

	Number		% of Net		Value
Security	of Shares		Assets		($)
Common Stock 90.0% of net assets
Brazil 5.8%
Banco do Brasil S.A.		191,500		0.7		2,405,296
Petroleo Brasileiro S.A. - Petrobras		633,300		1.9		6,071,070
Vale S.A.		165,800		0.9		2,838,261
Other Securities				2.3		7,423,713
				5.8		18,738,340
Chile 0.8%
Other Securities				0.8		2,470,360
China 11.0%
Bank of China Ltd., Class H		7,054,234		1.0		3,305,149
China Construction Bank Corp., Class H		6,560,000		1.7		5,505,877
China Mobile Ltd.		551,500		1.9		6,065,735
China Petroleum & Chemical Corp., Class H		3,228,000		1.1		3,562,304
CNOOC Ltd.		1,245,000		0.7		2,331,971
Industrial & Commercial Bank of China Ltd., Class H		4,383,172		1.0		3,089,718
PetroChina Co., Ltd., Class H		2,635,000		1.0		3,358,646
Other Securities				2.6		8,621,781
				11.0		35,841,181
Colombia 0.2%
Other Securities				0.2		763,152
Czech Republic 0.6%
Other Securities				0.6		2,068,381
Egypt 0.3%
Other Securities				0.3		891,281
Hungary 0.7%
Other Securities				0.7		2,432,147
India 3.1%
Oil & Natural Gas Corp., Ltd.		278,294		0.5		1,690,714
Reliance Industries Ltd.		192,625		0.9		2,821,869
Other Securities				1.7		5,441,775
				3.1		9,954,358
Indonesia 0.8%
Other Securities				0.8		2,464,288
Malaysia 1.6%
Other Securities				1.6		5,241,311
Mexico 4.1%
America Movil S.A.B. de C.V., Series L		3,305,100		1.1		3,557,617
Cemex S.A.B. de C.V., Series CPO *		2,975,128		1.0		3,354,348
Other Securities				2.0		6,485,650
				4.1		13,397,615
Poland 2.1%
Polski Koncern Naftowy Orlen S.A. *		130,723		0.6		2,029,757
Other Securities				1.5		4,893,871
				2.1		6,923,628
Republic of Korea 20.8%
Hyundai Motor Co.		16,832		0.9		3,056,406
Korea Electric Power Corp. *		81,620		0.7		2,353,286
KT Corp.		54,780		0.6		1,792,340
LG Corp.		75,268		1.4		4,489,899
LG Display Co., Ltd. *		68,050		0.6		1,862,084
LG Electronics, Inc.		46,240		1.1		3,706,271
POSCO		15,782		1.4		4,536,174
Samsung Electronics Co., Ltd.		10,273		4.4		14,207,756
Shinhan Financial Group Co., Ltd.		55,190		0.6		1,911,621
SK Holdings Co., Ltd.		17,393		0.8		2,510,332
SK Innovation Co., Ltd.		13,026		0.5		1,781,104
SK Telecom Co., Ltd.		11,432		0.6		2,012,315
Other Securities				7.2		23,197,801
				20.8		67,417,389
Russia 14.7%
Gazprom ADR		1,493,970		3.7		11,897,920
LUKOIL ADR		239,505		4.7		15,228,667

48 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		% of Net			Value
Security	of Shares		Assets			($)
Mining & Metallurgical Co. Norilsk Nickel OJSC ADR		155,278		0.7			2,396,822
Mobile TeleSystems ADR		101,551		0.6			2,102,106
Rosneft Oil Co. GDR - Reg’d		273,215		0.6			1,873,854
Sberbank of Russia ADR *		181,254		0.7			2,339,395
Surgutneftegas ADR		719,007		1.9			6,134,276
Tatneft ADR		53,812		0.6			2,041,688
Other Securities				1.2			3,796,267
				14.7			47,810,995
South Africa 6.5%
MTN Group Ltd.		172,821		1.0			3,118,725
Sasol Ltd.		87,533		1.2			3,791,624
Other Securities				4.3			14,356,496
				6.5			21,266,845
Taiwan 13.7%
Asustek Computer, Inc.		178,041		0.6			2,073,706
AU Optronics Corp. *		4,387,800		0.6			2,068,121
China Steel Corp.		2,062,544		0.6			1,819,700
Chunghwa Telecom Co., Ltd.		558,906		0.5			1,784,081
Hon Hai Precision Industry Co., Ltd.		1,428,546		1.1			3,692,472
Nan Ya Plastics Corp.		922,160		0.6			1,839,970
Taiwan Semiconductor Manufacturing Co., Ltd.		1,750,689		2.0			6,497,562
Other Securities				7.7			24,621,917
				13.7			44,397,529
Thailand 1.1%
PTT PCL		156,887		0.5			1,742,595
Other Securities				0.6			1,756,097
				1.1			3,498,692
Turkey 1.9%
Other Securities				1.9			6,076,718
United Arab Emirates 0.2%
Other Securities				0.2			713,857
Total Common Stock
(Cost $286,472,038)							292,368,067
Preferred Stock 8.7% of net assets
Brazil 7.9%
Banco Bradesco S.A.		170,176		0.9			2,798,342
Itau Unibanco Holding S.A.		230,300		1.2			3,872,194
Petroleo Brasileiro S.A.		680,200		2.1			6,830,048
Vale S.A., Class A		222,000		1.1			3,621,682
Other Securities				2.6			8,528,369
				7.9			25,650,635
Colombia 0.1%
Other Securities				0.1			301,443
Republic of Korea 0.7%
Other Securities				0.7			2,205,817
Total Preferred Stock
(Cost $32,364,495)							28,157,895
Other Investment Company 0.7% of net assets
United States 0.7%
iShares MSCI Emerging Markets Index Fund		55,000		0.7			2,380,950
Total Other Investment Company
(Cost $2,399,360)							2,380,950
	Face
Security	Amount		% of Net			Value
Rate, Maturity Date	($)		Assets			($)
Short-Term Investments 0.4% of net assets
Time Deposit 0.4%
Other Securities				0.4			1,102,183
U.S. Treasury Bill 0.0%
Other Securities				0.0			109,997
Total Short-Term Investments
(Cost $1,212,180)							1,212,180
End of Investments.
					��
	Number		% of Net			Value
Security	of Shares		Assets			($)
Collateral Invested for Securities on Loan 0.1% of net assets
Wells Fargo Advantage Government Money Market Fund		284,700		0.1			284,700
Total Collateral Invested for Securities on Loan
(Cost $284,700)							284,700
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $326,654,343 and the unrealized appreciation and depreciation were $33,126,002 and ($35,661,253), respectively, with a net unrealized depreciation of ($2,535,251).

See financial notes 49

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

At 04/30/13, the values of certain foreign securities held by the fund aggregating $247,229,568 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

For the following notes, please refer to complete schedule of holdings.

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	All or a portion of this security is held as collateral for open futures contracts.
(c)	The rate shown is the purchase yield.

ADR —	American Depositary Receipt
GDR —	Global Depositary Receipt
Reg’d —	Registered

In additional to the above the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI Emerging Markets, Mini, Long, expires 06/21/13		22		1,143,890		57,582

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$99,740,629		$—		$99,740,629
Brazil		18,738,340		—		—		18,738,340
Chile		2,470,360		—		—		2,470,360
Colombia		763,152		—		—		763,152
Czech Republic		1,330,161		738,220		—		2,068,381
India		480,296		9,474,062		—		9,954,358
Malaysia		640,265		4,601,046		—		5,241,311
Mexico		13,397,615		—		—		13,397,615
Republic of Korea		938,956		66,478,433		—		67,417,389
Russia		2,102,106		45,708,889		—		47,810,995
South Africa		2,984,373		18,282,472		—		21,266,845
Thailand		3,498,692		—		—		3,498,692
Preferred Stock1		—		2,205,817		—		2,205,817
Brazil		25,650,635		—		—		25,650,635
Colombia		301,443		—		—		301,443
Other Investment Company1		2,380,950		—		—		2,380,950
Short-Term Investments1		—		1,212,180		—		1,212,180
Total		$75,677,344		$248,441,748		$—		$324,119,092
Other Financial Instruments
Collateral Invested for Securities on Loan		$284,700		$—		$—		$284,700
Futures Contract2		57,582		—		—		57,582

1	As categorized in complete schedule of holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were security transfers in the amount of $1,652,638 and $4,249,385 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, for the period ended April 30, 2013. The transfers between Level 1 and Level 2 were primarily due to the use of international fair valuation by the fund. There were no transfers in or out of Level 3 securities during the period.

50 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $322,448,073) including securities on loan of $265,548		$324,119,092
Foreign currency, at value (cost $218,496)		218,683
Collateral invested for securities on loan		284,700
Receivables:
Dividends		585,755
Fund shares sold		449,051
Due from broker for futures		15,070
Income from securities on loan		34
Interest		1
Prepaid expenses	+	2,744
Total assets		325,675,130
Liabilities
Collateral held for securities on loan		284,700
Payables:
Investment adviser and administrator fees		6,603
Fund shares redeemed		504,862
Foreign capital gains tax		14,779
Accrued expenses	+	257,348
Total liabilities		1,068,292
Net Assets
Total assets		325,675,130
Total liabilities	−	1,068,292
Net assets		$324,606,838
Net Assets by Source
Capital received from investors		336,429,140
Net investment income not yet distributed		919,384
Net realized capital losses		(14,456,217	)
Net unrealized capital gains		1,714,531
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$324,606,838		36,526,198			$8.89

See financial notes 51

 Schwab Fundamental Emerging Markets Large Company Index Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $475,249)		$2,928,470
Interest		717
Securities on loan	+	89
Total investment income		2,929,276
Expenses
Investment adviser and administrator fees		820,066
Shareholder service fees		115,942
Index fee		171,830
Custodian fees		153,245
Transfer agent fees		47,845
Portfolio accounting fees		36,593
Professional fees		26,414
Shareholder reports		20,142
Registration fees		16,345
Trustees’ fees		3,843
Interest expense		1,413
Other expenses	+	22,842
Total expenses		1,436,520
Expense reduction by CSIM and its affiliates	−	606,625
Net expenses	−	829,895
Net investment income		2,099,381
Realized and Unrealized Gains (Losses)
Net realized gains on investments (net of foreign capital gain tax of $4,943)		899,330
Net realized losses on futures contracts		(260,378	)
Net realized losses on foreign currency transactions	+	(36,014	)
Net realized gains		602,938
Net unrealized gains on investments (net of foreign capital gain tax of ($14,779))		6,257,383
Net unrealized gains on futures contracts		57,582
Net unrealized gains on foreign currency translations	+	1,613
Net unrealized gains	+	6,316,578
Net realized and unrealized gains		6,919,516
Increase in net assets resulting from operations		$9,018,897

52 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$2,099,381			$8,746,795
Net realized gains (losses)		602,938			(10,496,285	)
Net unrealized gains	+	6,316,578			1,914,953
Increase in net assets from operations		9,018,897			165,463
Distributions to Shareholders
Distributions from net investment income		(8,681,589	)		(7,541,071	)
Distributions from net realized gains	+	—			(5,755,205	)
Total distributions		($8,681,589	)		($13,296,276	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			7,242,767		$65,730,641			17,148,007		$151,059,085
Shares reinvested			618,303		5,583,275			938,276		7,843,989
Shares redeemed	+		(6,814,982	)	(61,250,123	)		(16,432,968	)	(141,900,887	)
Net transactions in fund shares			1,046,088		$10,063,793			1,653,315		$17,002,187
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			35,480,110		$314,205,737			33,826,795		$310,334,363
Total increase	+		1,046,088		10,401,101			1,653,315		3,871,374
End of period			36,526,198		$324,606,838			35,480,110		$314,205,737
Net investment income not yet distributed					$919,384					$7,501,592

See financial notes 53

 Schwab Fundamental Index Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds discussed in this report is a series of Schwab Capital Trust (the “trust”), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trust as of the end of the period, including the funds discussed in this report, which are highlighted:

Schwab Capital Trust (organized May 7, 1993)	Schwab Large-Cap Growth Fund
Schwab Fundamental US Large Company Index Fund	Schwab Small-Cap Equity Fund
Schwab Fundamental US Small Company Index Fund	Schwab Hedged Equity Fund
Schwab Fundamental International Large Company Index Fund	Schwab Financial Services Fund
Schwab Fundamental International Small Company Index Fund	Schwab Health Care Fund
Schwab Fundamental Emerging Markets Large Company Index Fund	Schwab International Core Equity Fund
Schwab S&P 500 Index Fund	Schwab Target 2010 Fund
Schwab Small-Cap Index Fund	Schwab Target 2015 Fund
Schwab Total Stock Market Index Fund	Schwab Target 2020 Fund
Schwab International Index Fund	Schwab Target 2025 Fund
Schwab MarketTrack All Equity Portfolio	Schwab Target 2030 Fund
Schwab MarketTrack Growth Portfolio	Schwab Target 2035 Fund
Schwab MarketTrack Balanced Portfolio	Schwab Target 2040 Fund
Schwab MarketTrack Conservative Portfolio	Schwab Target 2045 Fund
Laudus Small-Cap MarketMasters Fund	Schwab Target 2050 Fund
Laudus International MarketMasters Fund	Schwab Target 2055 Fund
Schwab Balanced Fund	Schwab Monthly Income Fund - Moderate Payout
Schwab Core Equity Fund	Schwab Monthly Income Fund - Enhanced Payout
Schwab Dividend Equity Fund	Schwab Monthly Income Fund - Maximum Payout

Each fund in this report offers one share class. Shares are bought and sold (subject to a redemption fee, see financial note 9) at closing net asset value per share (“NAV”), which is the price for all outstanding shares of the funds. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the “Board”) may authorize the issuance of as many shares as necessary.

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 may also keep certain assets in segregated accounts, as required by securities law.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

(a) Security Valuation:

Under procedures approved by the Board, the investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

The funds value the securities in their portfolios every business day. The funds use the following policies to value various types of securities:

•  Securities traded on an exchange or over-the-counter: Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at halfway between the most recent bid and ask quotes. Securities that are primarily traded on foreign exchanges are valued at the official closing price or the last sales price on the exchange where the securities are principally traded with these values then translated into U.S. dollars at the current exchange rate, unless these securities are fair valued as discussed below.

•  Securities for which no quoted value is available: The Board has adopted procedures to fair value each fund’s securities when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Each fund makes fair value determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a

54 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ techniques such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing Committee regularly reviews these inputs and assumptions to calibrate the valuations. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security. The Board convenes on a regular basis to review fair value determinations made by the funds pursuant to the valuation procedures.

•  Foreign equity security fair valuation: The Board has adopted procedures to fair value foreign equity securities that are traded in markets that close prior to the funds valuing their holdings. By fair valuing securities whose prices may have been affected by events occurring after the close of trading, each fund seeks to establish prices that investors might expect to realize upon the current sales of these securities. This methodology is designed to deter “arbitrage” market timers, who seek to exploit delays between the change in the value of a fund’s portfolio holdings and the net asset value of the fund’s shares, and seeks to help ensure that the prices at which the fund’s shares are purchased and redeemed are fair and do not result in dilution of shareholder interest or other harm to shareholders. When fair value pricing is used at the open or close of a reporting period, it may cause a temporary divergence between the return of a fund and that of its comparative index or benchmark. The Board regularly reviews fair value determinations made by the funds pursuant to these procedures.

•  Futures and forward foreign currency exchange contracts: Futures and forwards are valued at their settlement prices as of the close of their exchanges (for futures) or at a value based on that day’s forward exchange rates (for forwards).

•  Short-term securities (60 days or less to maturity): Short-term securities are valued at amortized cost, which approximates market value.

•  Underlying funds: Mutual funds are valued at their respective net asset values. Exchange trade funds (ETFs) traded on a recognized securities exchange are valued at the last reported sale price that day or the official closing price, if applicable.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If the funds determine that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

•  Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities and futures contracts. Investments in mutual funds are valued daily at their NAVs, which are classified as Level 1 prices.

•  Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. In addition, international securities whose markets close hours before the funds value their holdings may require fair valuations due to significant movement in the U.S. markets occurring after the daily close of the foreign markets. The Board has approved a vendor that calculates fair valuations of international equity securities based on a number of factors that appear to correlate to the movements in the U.S. markets. As investments whose values are classified as Level 2 prices include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

55

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

•  Level 3 — significant unobservable inputs (including the funds’ own assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not available for these securities, the funds use one or more valuation techniques for which sufficient and reliable data is available. The inputs used by the funds in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the funds in the absence of market information. Assumptions used by the funds due to the lack of observable inputs may significantly impact the resulting fair value and therefore the funds’ results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the funds’ investments as of April 30, 2013 are disclosed in the Portfolio Holdings.

(b) Accounting Policies for certain Portfolio Investments (if held):

Futures Contracts: Futures contracts are instruments that represent an agreement between two parties that obligates one party to buy, and the other party to sell, specific instruments at an agreed upon price on a stipulated future date. A fund must give the broker a deposit of cash and/or securities (initial margin) whenever it enters into the futures contract. The amount of the deposit may vary from one contract to another. Subsequent payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized gains or losses until the contract is closed, at which time the gains or losses are realized. Futures are traded publicly on exchanges, and their market value changes daily.

Forward Foreign Currency Exchange Contracts: “Forwards”, as they are known, are contracts to buy and sell a currency at a set price on a future date. The value of the forwards is accounted for as unrealized gains or losses until the contracts settle, at which time the gains or losses are realized.

Securities Lending: Under the trust’s Securities Lending Program, a fund (lender) may make short-term loans of its securities to another party (borrower) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, securities issued or fully guaranteed by the U.S. government or foreign governments, or letters of credit issued by a bank. Collateral at the individual loan level is required to have a value of at least 102% of the prior day’s market value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities and is marked to market daily. The cash collateral of securities loaned is invested in money market portfolios operating under Rule 2a-7 of the 1940 Act. Securities lending income, as disclosed in a fund’s Statement of Operations, if applicable, represents the income earned from the investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent which are subject to adjustments pursuant to the securities lending agreement.

If applicable, the value of the securities on loan as of April 30, 2013 and the value of the related collateral are disclosed in the Statement of Assets and Liabilities and the complete Portfolio Holdings.

(c) Security Transactions:

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains or 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 calculated using exchange rates in effect on the transaction date. Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the differences between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains or losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period. These realized and unrealized foreign exchange gains or losses are reported in foreign currency transactions or translations in the Statement of Operations. The funds do not isolate the

56 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

portion of the fluctuations on investments resulting from changes in foreign currency exchange rates from the fluctuations in market prices of investments held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.

Gains realized by the funds on the sale of securities in certain foreign countries may be subject to non-U.S. taxes. In those instances, the funds record a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.

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 of the contract, and records a realized gain or loss accordingly.

(d) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds 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 received from foreign sources may result in withholding tax. Withholding taxes are accrued at the same time as the related income if the tax rate is fixed and known, unless a tax withheld is reclaimable from the local tax authorities in which case it is recorded as receivable. If the tax rate is not known or estimable, such expense or reclaim receivable is recorded when the net proceeds are received.

(e) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within the trust generally are allocated among the funds in proportion to their average daily net assets.

(f) Distributions to Shareholders:

The funds make distributions from net investment income and net realized capital gains, if any, once a year.

(g) Custody Credit:

Certain funds have an arrangement with their custodian bank, under which the funds may receive a credit for their uninvested cash balance to offset their custody fees and accounting fees. The credit amounts, if any, are disclosed in the Statement of Operations as a reduction to the funds’ operating expenses.

(h) Accounting Estimates:

The accounting policies described in this report conform to GAAP. 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 and these differences may be material.

(i) Federal Income Taxes:

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.

(j) Foreign Taxes:

The funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, corporate events, foreign currency exchanges and capital gains on investments. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in foreign markets in which the funds invest. These foreign taxes, if any, are paid by the funds and are disclosed in the Statement of Operations. Foreign taxes payable as of April 30, 2013, if any, are reflected in the funds’ Statements of Assets and Liabilities.

57

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(k) Indemnification:

Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.

(l) New Accounting Pronouncements:

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative instruments. Management is currently evaluating the impact the adoption of ASU No. 2011-11 may have on the funds’ financial statement disclosures.

3. Risk Factors:

Investing in the funds may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Stock markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of the investment in a fund will fluctuate, which means that the investors could lose money.

The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

As an index fund, each fund seeks to track the performance of its comparative index, although it may not be successful in doing so. The divergence between the performance of a fund and its index, positive or negative, is called “tracking error”. Tracking error can be caused by many factors and it may be significant. For example, a fund may not invest in certain securities in the index, or match the securities’ weightings to the index, due to regulatory, operational, custodial or liquidity constraints; corporate transactions; asset valuations; transaction costs and timing; tax considerations; and index rebalancing, which may result in tracking error.

Each fund invests in companies measured by its respective index. It follows these stocks during upturns as well as downturns. Because of its indexing strategy, a fund does not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of a fund’s expenses, the fund’s performance may be below that of the index.

If a fund uses a sampling method, the fund will not fully replicate its comparative index and may hold securities not included in the index. As a result, the fund is subject to the risk that the investment adviser’s investment management strategy, the implementation of which is subject to a number of constraints, may not produce the intended results. If a fund utilizes a sampling approach, it may not track the return of the index as well as it would if the fund purchased all of the securities in its index.

To the extent that a fund’s or the index’s portfolio is concentrated in the securities of issuers in a particular market, industry, group of industries, sector, or asset class, the fund may be adversely affected by the performance of those securities, may be subject to increased price volatility and may be more susceptible to adverse economic, market, political or regulatory occurrences affecting that market, industry, group of industries, sector, or asset class.

Although certain indices encompass stocks from many different sectors of the economy, their performance may primarily reflect that of large company stocks, which tend to go in and out of favor based on market and economic conditions. As a result, during a period when these stocks fall behind other types of investments — bonds or small company stocks, for instance — a fund’s large-cap holdings could reduce performance.

Historically, small-cap stocks have been riskier than large-cap stocks, and their prices may move sharply, especially during market upturns and downturns. Small-cap companies may be more vulnerable to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall behind other types of investments — large-cap stocks, for instance — a fund’s small-cap holdings could reduce performance.

58 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

A fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs.

Emerging market countries may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Such countries often have less uniformity in accounting and reporting requirements and greater risk associated with the custody of securities. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in other countries. As a result, there will tend to be an increased risk of price volatility associated with a fund’s investments in emerging market countries and, at times, it may be difficult to value such investments.

A fund may purchase shares of exchange-traded funds (“ETF”) to gain exposure to a particular portion of the market while awaiting an opportunity to purchase securities directly. When a fund invests in an ETF, in addition to directly bearing the expenses associated with its own operations, it will bear a pro rata portion of the ETF’s expenses. Therefore, it may be more costly to own an ETF than to own the underlying securities directly. In addition, while the risks of owning shares of an ETF generally reflect the risks of owning the underlying securities the ETF is designed to track, lack of liquidity in an ETF can result in its value being more volatile than the underlying portfolio securities.

A fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Certain of these risks, such as liquidity risk and market risk, are discussed elsewhere in this section. A fund’s use of derivatives is also subject to credit risk, leverage risk, lack of availability risk, valuation risk, correlation risk and tax risk. Lack of availability risk is the risk that suitable derivative transactions may not be available in all circumstances for risk management or other purposes. Credit risk is the risk that the counterparty to a derivatives transaction may not fulfill its obligations. Leverage risk is the risk that a small percentage of assets invested in derivatives can have a disproportionately larger impact on a fund. Valuation risk is the risk that a particular derivative may be valued incorrectly. Correlation risk is the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate or index. Tax risk is the risk that the use of derivatives may cause the fund to realize higher amounts of short-term capital gain. These risks could cause a fund to lose more than the principal amount invested.

A particular investment may be difficult to purchase or sell. A fund may be unable to sell illiquid securities at an advantageous time or price.

Securities lending involves the risk of loss of rights in the collateral or delay in recovery of the collateral if the borrower fails to return the security loaned or becomes insolvent.

Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.

4. Affiliates and Affiliated Transactions:

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement (“Advisory Agreement”) between CSIM and the trust.

59

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

For its advisory and administrative services to the funds, CSIM is entitled to receive an annual fee, payable monthly, based on a percentage of each fund’s average daily net assets as follows:

									Schwab
					Schwab		Schwab		Fundamental
	Schwab		Schwab		Fundamental		Fundamental		Emerging
	Fundamental		Fundamental		International		International		Markets
	US Large		US Small		Large		Small		Large
	Company		Company		Company		Company		Company
% of Average Daily Net Assets	Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
First $500 million		0.30%		0.30%		0.30%		0.40%		0.50%
$500 million to $5 billion		0.22%		0.22%		0.22%		0.38%		0.48%
$5 billion to $10 billion		0.20%		0.20%		0.20%		0.36%		0.46%
over $10 billion		0.18%		0.18%		0.18%		0.34%		0.44%

The Board has adopted a Shareholder Servicing Plan (the “Plan”) on behalf of the funds. The Plan enables each fund to bear expenses relating to the provision by service providers, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, “Schwab”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds. Schwab serves as the funds’ paying agent under the Plan for making payments of the shareholder service fee due to the service providers (other than Schwab). All shareholder service fees paid by the funds to Schwab in its capacity as the funds’ paying agent will be passed through to the service providers, and Schwab will not retain any portion of such fees.

Pursuant to the Plan, each fund’s shares are subject to an annual shareholder servicing fee up to 0.10%. The shareholder servicing fee paid to a particular service provider is made pursuant to its written agreement with Schwab (or, in the case of payments made to Schwab, pursuant to Schwab’s written agreement with the funds). Payments under the Plan are made as described above regardless of Schwab’s or the service provider’s actual cost of providing the services. If the cost of providing the services under the Plan is less than the payments received, the unexpended portion of the fees may be retained as profit by Schwab or the service provider.

Although these agreements specify certain fees for these services, CSIM and its affiliates have made an additional agreement with the funds, for so long as CSIM serves as the investment adviser to the funds, which may only be amended or terminated with the approval of the Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses (“expense limitation”). The expense limitation as a percentage of average daily net assets is as follows:

								Schwab
				Schwab		Schwab		Fundamental
Schwab		Schwab		Fundamental		Fundamental		Emerging
Fundamental		Fundamental		International		International		Markets
US Large		US Small		Large		Small		Large
Company		Company		Company		Company		Company
Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
	0.35%		0.35%		0.35%		0.55%		0.60%

Subsequent to the reporting period ended April 30, 2013, and effective June 11, 2013, the expense limitations of the Schwab Fundamental International Small Company Index Fund and the Schwab Fundamental Emerging Markets Large Company Index Fund have been reduced to 0.49%.

In addition to the contractual expense limitation agreements noted above, to further help offset the costs of a change in the comparative index for certain funds, CSIM agreed to voluntarily waive the net operating expenses to 0.00% (excluding interest, taxes, and certain non-routine expenses) as follows: (1) from November 1, 2012 through November 15, 2012 for Schwab Fundamental International Large Company Index Fund; (2) from November 1, 2012 through December 15, 2012 for Schwab Fundamental International Small Company Index Fund; and (3) from November 1, 2012 through November 30, 2012 for Schwab Fundamental Emerging Markets Large Company Index Fund.

CSIM has a licensing agreement with the Frank Russell Company to use certain Russell indices and trademarks in connection with the offering and operation of certain registered investment companies. The funds have entered into a sub-license agreement with CSIM pursuant to which CSIM has agreed to sub-license certain Russell indices and trademarks to the funds. Under the sub-license agreement, each fund pays its pro rata share of licensing fees.

60 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

The funds may engage in certain transactions involving affiliates. For instance, a fund may own shares of The Charles Schwab Corporation if that company is included in its index. Below is the summary of investment activities involving The Charles Schwab Corporation shares owned by the Schwab Fundamental US Large Company Index Fund during the report period:

Balance

Balance

Realized

Dividends

of Shares

of Shares

Market

Gains (Losses)

Received

Held at

Gross

Gross

Held at

Value at

11/01/12

11/01/12

Fund

10/31/12

Additions

Sales

04/30/13

04/30/13

to 04/30/13

to 04/30/13

Schwab Fundamental US Large Company Index Fund

145,215

14,800

(11,300

)

148,715

$2,522,206

($51,082

)

$16,748

Certain other related parties may own shares of Schwab funds in this report. As of April 30, 2013, the shares owned by Schwab Charitable Giving Trust (an affiliate of Schwab) as a percentage of the total shares of the Schwab Fundamental International Large Company Index Fund was 11.92%.

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other Schwab Funds. All loans are for temporary or emergency purposes only. The interest rate to be charged on a loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.

5. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted in each fund’s Statement of Operations. For information regarding the trustees please refer to Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The funds have access to custodian overdraft facilities, a committed line of credit of $150 million with State Street Bank and Trust Company (“State Street”), an uncommitted line of credit of $100 million with Bank of America, N.A. and an uncommitted line of credit of $50 million with Brown Brothers Harriman & Co. The funds pay interest on the amounts they borrow at rates that are negotiated periodically. The funds also pay an annual fee to State Street for the committed line of credit.

There were no borrowings from the lines of credit by the funds during the period. However, the funds may have utilized their overdraft facility and incurred interest expense, which is disclosed in the Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

7. Derivatives:

Certain funds entered into equity index futures contracts (“futures”) during the report period. The funds invested in futures to equitize available cash. The fair value and due to brokers for futures contracts held at April 30, 2013 are presented on the face of the Portfolio Holdings and Statement of Assets, respectively. The net realized/unrealized gains (losses) on futures contracts are presented on the Statement of Operations. Refer to financial note 2(b) for the funds’ accounting policies with respect to futures contracts and financial note 3 for disclosures concerning the risks of investing in futures contracts. During the period, the month-end average contract values of futures contracts held by the funds and the month-end average number of contracts held were as follows:

	Contract Values		Number of Contracts
Schwab Fundamental US Large Company Index Fund		$35,057,650		462
Schwab Fundamental US Small Company Index Fund		10,302,110		116
Schwab Fundamental International Large Company Index Fund		6,738,121		80
Schwab Fundamental International Small Company Index Fund		1,659,298		20
Schwab Fundamental Emerging Markets Large Company Index Fund		3,664,121		69

61

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

8. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2013, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Schwab Fundamental US Large Company Index Fund		$415,124,310		$98,247,427
Schwab Fundamental US Small Company Index Fund		81,989,437		75,714,665
Schwab Fundamental International Large Company Index Fund		53,657,152		42,034,959
Schwab Fundamental International Small Company Index Fund		19,890,124		12,663,320
Schwab Fundamental Emerging Markets Large Company Index Fund		40,147,742		38,229,852

9. Redemption Fee:

The funds charge a 2.00% redemption fee on shares sold or exchanged within 30 days of the original purchase date. Such amounts are netted against redemption proceeds in the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

	Current Period		Prior Period
	(11/1/12-4/30/13)		(11/1/11-10/31/12)
Schwab Fundamental US Large Company Index Fund		$12,854		$30,160
Schwab Fundamental US Small Company Index Fund		4,383		6,059
Schwab Fundamental International Large Company Index Fund		2,053		6,070
Schwab Fundamental International Small Company Index Fund		967		850
Schwab Fundamental Emerging Markets Large Company Index Fund		2,146		9,049

10. Federal Income Taxes:

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of October 31, 2012, the funds had capital loss carryforwards available to offset future net capital gains before the expiration dates as follows:

					Schwab		Schwab		Schwab
	Schwab		Schwab		Fundamental		Fundamental		Fundamental
	Fundamental		Fundamental		International		International		Emerging
	US Large		US Small		Large		Small		Markets Large
	Company		Company		Company		Company		Company
Expiration Date	Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
October 31, 2016		$255,601		$—		$6,761,375		$—		$—
October 31, 2017		63,611,979		—		58,777,944		—		—
October 31, 2018		—		—		20,948,477		—		—
No expiration*		—		—		16,313,694		4,810,006		10,852,615
Total		$63,867,580		$—		$102,801,490		$4,810,006		$10,852,615

* As a result of the passage of the Regulated Investment Company Modernization Act of 2010, capital losses incurred after December 31, 2010 may now be carried forward indefinitely, but must retain the character of the original loss. However, such losses must be utilized prior to the pre-enactment capital losses, which may increase the likelihood that the pre-enactment capital losses may expire unused. Under pre-enactment law, capital losses could be carried forward for eight years, and carried forward as short-term capital loss, irrespective of the character of the original loss.

62 

 Schwab Fundamental Index Funds

Financial Notes, unaudited (continued)

10. Federal Income Taxes (continued):

For the year ended October 31, 2012, the funds had capital losses utilized as follows:

					Schwab		Schwab		Schwab
	Schwab		Schwab		Fundamental		Fundamental		Fundamental
	Fundamental		Fundamental		International		International		Emerging
	US Large		US Small		Large		Small		Markets Large
	Company		Company		Company		Company		Company
	Index Fund		Index Fund		Index Fund		Index Fund		Index Fund
Capital losses utilized		$40,159,384		$—		$—		$—		$—

As of October 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended October 31, 2012, the funds did not incur any interest or penalties.

11. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

63

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Capital Trust, which includes the funds covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The Fund Complex includes 94 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the funds’ Statement of Additional Information, which is available free by calling 1-800-435-4000.

 Independent Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Mariann Byerwalter 1960 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman of JDN Corporate Advisory LLC (advisory services firm) (Oct. 2001 – present).	77	Director,WageWorks, Inc. (2010 – present) Director, Redwood Trust, Inc. (1998 – present) Director, PMI Group Inc. (2001 – 2009)
John F. Cogan 1947 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research; Professor of Public Policy, Stanford University (Sept. 2000 – present).	77	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
William A. Hasler 1941 Trustee (Trustee of Schwab Capital Trust since 2000.)	Dean Emeritus, Haas School of Business, University of California, Berkeley (July 1998 – present).	77	Director, TOUSA (1998 – present) Director, Globalstar, Inc. (2009 – present) Director, Aviat Networks (2001 – present) Director, Mission West Properties (1998 – 2012) Director, Ditech Networks Corporation (1997 – 2012) Director, Genitope Corporation (2000 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	77	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Tercica Inc. (2004 – 2008)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – present); Senior Vice President and General Manager of Consumer Group, Intuit, Inc. (June 2007 – Dec. 2008); Senior Vice President and Chief Financial Officer, Intuit, Inc. (Sept. 2005 – Jan. 2008).	77	Director, KLA-Tencor Corporation (2008 – present) Director, BEA Systems, Inc. (2007 – 2008)
Gerald B. Smith 1950 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (1990 – present).	77	Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – present) Director, Oneok, Inc (2009 – present) Lead Independent Director, Board of Cooper Industries (2002 – 2012)

64 

 Independent Trustees (continued)

Name, Year of Birth,			Number of
and Position(s) with			Portfolios in
the trust; (Terms of			Fund Complex
office, and length of	Principal Occupations		Overseen by
Time Served1)	During the Past Five Years	��	the Trustee	Other Directorships
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (Jan. 2008- present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).		77	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

 Interested Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served )	During the Past Five Years	the Trustee	Other Directorships
Charles R. Schwab2 1937 Chairman and Trustee (Chairman and Trustee of Schwab Capital Trust since 1993.)	Chairman and Director, The Charles Schwab Corporation, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc., Charles Schwab Bank, N. A.; Chairman and Chief Executive Officer, Schwab (SIS) Holdings Inc. I, Schwab International Holdings, Inc.; Chief Executive Officer, Schwab Holdings, Inc.; Through June 2007, Director, U.S. Trust Company, N. A., U.S. Trust Corporation, United States Trust Company of New York. Until October 2008, Chief Executive Officer, The Charles Schwab Corporation, Charles Schwab & Co., Inc.	77	None
Walter W. Bettinger II2 1960 Trustee (Trustee of Schwab Capital Trust since 2008.)	As of October 2008, President and Chief Executive Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. Since October 2008, Director, The Charles Schwab Corporation. Since May 2008, Director, Charles Schwab & Co., Inc. and Schwab Holdings, Inc. Since 2006, Director, Charles Schwab Bank. Until October 2008, President and Chief Operating Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. From 2004 through 2007, Executive Vice President and President, Schwab Investor Services. From 2004 through 2005, Executive Vice President and Chief Operating Officer, Individual Investor Enterprise, and from 2002 through 2004, Executive Vice President, Corporate Services.	94	None

 Officers of the Trust

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
Marie Chandoha 1961 President and Chief Executive Officer (Officer of Schwab Capital Trust since 2010.)	Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President and Chief Executive Officer (Dec. 2010 – present) and Chief Investment Officer (Dec. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 2007 – August 2010).

65

 Officers of the Trust (continued)

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
George Pereira 1964 Treasurer and Principal Financial Officer (Officer of Schwab Capital Trust since 2004.)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab Asset Management (Ireland) Limited (April 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 2011 – present); Senior Managing Director, Global Head of Active Fixed-Income Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head of Market-Based Strategies, State Street Research (August 2003 – Jan. 2005).
David Lekich 1964 Secretary and Chief Legal Officer (Officer of Schwab Capital Trust since 2011.)	Senior Vice President (Sept. 2011 – present), Vice President (March 2004 – Sept. 2011), Charles Schwab & Co., Inc.; Senior Vice President and Chief Counsel (Sept. 2011 – present), Vice President (Jan. 2011 – Sept. 2011), Charles Schwab Investment Management, Inc.; Secretary (April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President (Officer of Schwab Capital Trust since 2005.)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant Secretary, Schwab ETFs (Oct. 2009 – present).

1	Trustees remain in office until they resign, retire or are removed by shareholder vote. The Schwab Funds® retirement policy requires that independent trustees elected after January 1, 2000 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the Schwab Funds retirement policy also requires any independent trustee of the Schwab Funds who also serves as an independent trustee of the Laudus Funds to retire from the Boards of the Schwab Funds upon their required retirement date from either the Boards of Trustees of the Schwab Funds or the Laudus Funds, whichever comes first.
2	Mr. Schwab and Mr. Bettinger are Interested Trustees because they are employees of Schwab. In addition to their employment with Schwab, Messrs. Schwab and Bettinger also own stock of The Charles Schwab Corporation, the parent company of Schwab and the investment adviser.
3	The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

66 

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.

Barclays U.S. Aggregate Bond Index A broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-back securities (agency fixed-rate and hybrid ARM passthroughs), asset-backed securities, and commercial mortgage-backed securities.

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.”

An individual bond is subject to the credit risk of the issuer. Changes in interest rates can affect a bond’s market value prior to call or maturity. There is no guarantee that a bond’s yield to call or maturity will provide a positive return over the rate of inflation.

bond fund A bond fund is subject to the same credit, interest rate, and inflation risks as bonds. In addition, a bond fund incurs ongoing fees and expenses. A bond fund’s net asset value will fluctuate with the price of the underlying bonds and the portfolio turnover activity; return of principal is not guaranteed.

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.

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.

FTSE EPRA/NAREIT Global Index An index that is designed to provide a diverse representation of publicly traded equity REITs and listed property companies worldwide.

FTSE RAFI Developed ex US 1000 Index An index that is designed to track the performance of the largest listed companies domiciled in developed international markets (excluding the U.S.), selected based on the following four fundamental measures: dividends, cash flows, sales and book value.

FTSE RAFI Developed ex US Mid Small 1500 Index An index that is designed to track the performance of small and mid capitalization equities of companies domiciled in developed international markets (excluding the U.S.), selected based on the following four fundamental measures: dividends, cash flows, sales and book value.

FTSE RAFI Emerging Index An index that is designed to track the performance of the largest emerging market equities, selected based on the following four fundamental measures: dividends, cash flows, sales and book value.

FTSE RAFI US 1000 Index An index that is designed to track the performance of the largest listed U.S. companies, selected based on the following four fundamental measures: dividends, cash flows, sales and book value.

FTSE RAFI US Mid Small 1500 Index An index that is designed to track the performance of small and medium-sized listed U.S. companies, selected based on the following four fundamental measures: dividends, cash flows, sales and book value.

market cap, market capitalization The value of a company as determined by the total value of all shares of its stock outstanding.

MSCI EAFE Index A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada.

MSCI Emerging Markets Index A free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets.

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.

Russell 2000 Index An index that measures the performance of the small-cap segment of the U.S. equity universe.

Russell Fundamental Developed ex-U.S. Large Company Index An index that ranks companies in the Russell Developed ex-U.S. Index by fundamental measures of size and tracks the performance of those companies whose fundamental scores are in the top 87.5% of the Russell Developed ex-U.S. Index. The index uses a partial quarterly reconstitution methodology in which the index is split into four equal segments at the annual reconstitution and each segment is then rebalanced on a rolling quarterly basis. The Net series reduces index performance by adjusting for local taxes. The Russell Developed ex-U.S. Index measures the performance of the largest investable securities in developed countries globally, excluding companies assigned to the United States.

Russell Fundamental Developed ex-U.S. Small Company Index An index that ranks companies in the Russell Developed ex-U.S. Index by fundamental measures of size and tracks the performance of those companies whose fundamental scores are in the bottom 12.5% of the Russell Developed ex-U.S. Index. The index uses a partial quarterly reconstitution methodology in which the index is split into four equal segments at the annual reconstitution and each segment is then rebalanced on a rolling quarterly basis. The Net series reduces index performance by adjusting for local taxes. The Russell Developed ex-U.S. Index measures the performance of the largest investable securities in developed countries globally, excluding companies assigned to the United States.

67

Russell Fundamental Emerging Markets Large Company Index An index that ranks companies in the Russell Emerging Markets Index by measures of fundamental size and tracks the performance of those companies whose fundamental scores are in the top 87.5% of the Russell Emerging Markets Index. The index uses a partial quarterly reconstitution methodology in which the index is split into four equal segments at the annual reconstitution and each segment is then rebalanced on a rolling quarterly basis. The Net series reduces index performance by adjusting for local taxes. The Russell Emerging Markets Index measures the performance of the investable securities in emerging countries globally.

Russell Fundamental U.S. Large Company Index An index that ranks companies in the Russell 3000 Index by fundamental measures of size, and tracks the performance of those companies whose fundamental scores are in the top 87.5% of the Russell 3000 Index. The index uses a partial quarterly reconstitution methodology in which the index is split into four equal segments at the annual reconstitution and each segment is then rebalanced on a rolling quarterly basis. The Russell 3000 Index measures the performance of the largest 3000 U.S. companies representing approximately 98% of the investable U.S. equity market.

Russell Fundamental U.S. Small Company Index An index that ranks companies in the Russell 3000 Index by fundamental measures of size and tracks the performance of those companies whose fundamental scores are in the bottom 12.5% of the Russell 3000 Index. The index uses a partial quarterly reconstitution methodology in which the index is split into four equal segments at the annual reconstitution and each segment is then rebalanced on a rolling quarterly basis. The Russell 3000 Index measures the performance of the largest 3000 U.S. companies representing approximately 98% of the investable U.S. equity market.

S&P 500 Index A market capitalization index that is designed to measure the performance of 500 leading publicly held companies in leading industries of the U.S. economy.

stock A share of ownership, or equity, in the issuing company.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

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.

68 

Schwab Funds^® offers you an extensive family of mutual funds, each one based on a clearly defined investment approach and using disciplined management strategies. The list at right shows all currently available Schwab Funds.

Whether you are an experienced investor or just starting out, Schwab Funds can help you achieve your financial goals. An investor should consider a fund’s investment objectives, risks, charges and expenses carefully before investing or sending money. This and other important information can be found in the fund’s prospectus. Please call 1-800-435-4000 for a prospectus and brochure for any Schwab Fund. Please read the prospectus carefully before you invest. This report must be preceded or accompanied by a current prospectus.

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting Schwab’s website at www.schwabfunds.com/prospectus, the SEC’s website at http://www.sec.gov, or by contacting Schwab Funds at 1-800-435-4000.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.schwabfunds.com/prospectus or the SEC’s website at http://www.sec.gov.

The Schwab Funds Family^®

Stock Funds

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core Equity Fund

Schwab Fundamental US Large Company Index Fund

Schwab Fundamental US Small Company Index Fund

Schwab Fundamental International Large Company Index Fund

Schwab Fundamental International Small Company Index Fund

Schwab Fundamental Emerging Markets Large Company Index Fund

Schwab Global Real Estate Fund^tm

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market Index Fund^®

Schwab International Index Fund^®

Asset Allocation Funds

Schwab Balanced Fund^tm

Schwab MarketTrack All Equity Portfolio^tm

Schwab MarketTrack Growth Portfolio^tm

Schwab MarketTrack Balanced Portfolio^tm

Schwab MarketTrack Conservative Portfolio^tm

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

Schwab^® Monthly Income Fund – Moderate Payout

Schwab^® Monthly Income Fund – Enhanced Payout

Schwab^® Monthly Income Fund – Maximum Payout

Bond Funds

Schwab Short-Term Bond Market Fund^tm

Schwab Intermediate-Term Bond Fund^tm

Schwab Total Bond Market Fund^tm

Schwab GNMA Fund^tm

Schwab^® Treasury Inflation Protected Securities Index Fund

Schwab Tax-Free Bond Fund^tm

Schwab California Tax-Free Bond Fund^tm

Schwab Money Funds

Schwab offers an array of money market funds¹. Choose from taxable or tax-advantaged alternatives. Many can be linked to your eligible Schwab account to “sweep” cash balances automatically, subject to availability, when you’re between investments. Or, for your larger cash reserves, choose one of our Value Advantage Investments^®.

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.

Investment Adviser

Charles Schwab Investment Management, Inc.

211 Main Street, San Francisco, CA 94105

Funds

Schwab Funds^®

P.O. Box 3812, Englewood, CO 80155–3812

This report is not authorized for distribution to prospective investors

unless preceded or accompanied by a current prospectus.

^© 2013 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR37675-06

00098637

Semiannual report dated April 30, 2013, enclosed.

COMMAND PERFORMANCE^TM

Laudus MarketMasters Funds^tm

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Semiannual Report
April 30, 2013

COMMAND PERFORMANCE^TM

Laudus MarketMasters Funds^tm

Laudus Small-Cap MarketMasters Fund^tm

Laudus International MarketMasters Fund^tm

This page is intentionally left blank.

Two distinct Funds, each combining the expertise of leading

investment managers with CSIM’s overall supervision.

In This Report

Performance at a Glance	2
From the President	3
Fund Management	5
Performance and Fund Facts
Laudus Small-Cap MarketMasters Fund™	6
Laudus International MarketMasters Fund™	8
Fund Expenses	10
Financial Statements and Portfolio Holdings
Laudus Small-Cap MarketMasters Fund™	11
Laudus International MarketMasters Fund™	29
Financial Notes	56
Trustees and Officers	65
Glossary	68

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM).
Distributor: Charles Schwab & Co., Inc. (Schwab).

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS), which was developed by, and is the exclusive property of, MSCI and Standard & Poor’s (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the schedules of Portfolio Holdings are sub-categories of Sector classifications.

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.laudus.com/prospectus.

Total Return for the Six Months Ended April 30, 2013
Laudus Small-Cap MarketMasters Fundtm
Investor Shares (Ticker Symbol: SWOSX)	13.93%
Select Shares® (Ticker Symbol: SWMSX)	14.03%
Russell 2000® Index*	16.58%
Fund Category: Morningstar Small-Cap Growth	13.82%
Performance Details	pages 6-7
Laudus International MarketMasters Fundtm
Investor Shares1 (Ticker Symbol: SWOIX)	16.59%
Select Shares®1 (Ticker Symbol: SWMIX)	16.72%
MSCI EAFE Index® (Gross)**	17.18%
Fund Category: Morningstar Foreign Large-Cap Growth	12.05%
Performance Details	pages 8-9

Minimum Initial Investment2
Investor Shares	$	100
Select Shares®	$	50,000
��

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

Small-company stocks are subject to greater volatility than other asset categories.

Foreign securities can involve risks such as political and economic instability and currency risk. These risks may be greater in emerging markets.

*	The Russell 2000 Index measures the performance of the small-cap segment of the U.S. equity universe. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.
**	The MSCI EAFE Index® is a free float-adjusted market capitalization index that is designed to measure market equity performance in 22 developed market countries, excluding the U.S. and Canada. Investors cannot invest directly in any index and index figures do not include trading and management costs.
1	The fund’s performance relative to the index may be affected by fair-value pricing and timing differences in foreign exchange calculations, see financial note 2 for more information.
2	Please see the funds’ prospectus for further detail and eligibility requirements.

2 Laudus MarketMasters Funds

From the President

Marie Chandoha is President and CEO of Charles Schwab Investment Management, Inc. and the funds covered in this report.

Dear Shareholder,

As President and CEO of Charles Schwab Investment Management, Inc., I’d like to thank you for trusting us to help you meet your investment goals, and for reading this important report concerning the Laudus MarketMasters Funds. The funds combine complementary strategies from leading investment managers, providing diversification across multiple investment styles.

For the six months ended April 30, 2013, the returns of the funds reflected an environment that included a strong performance by small-cap U.S. stocks and by stocks in developed international markets. The backdrop for these performances included efforts undertaken by the Federal Reserve and many central banks around the world to stimulate faster economic growth by keeping interest rates low. This was particularly the case in Japan, where aggressive central bank policies helped fuel a rally by equities, while the yen depreciated sharply versus the U.S. dollar. In general, stocks benefited from these policies and from reduced concerns regarding the euro zone’s sovereign debt crisis and U.S. fiscal cliff. Stocks were also supported by some signs of improvement in the U.S. housing market.

Amid this environment, small-cap stocks generally outperformed large-cap stocks, while many major U.S. stock market indices finished at or near record highs. Globally, shares of companies in the Health Care and Financials sectors generated some of the highest overall returns, while shares of companies in the Information Technology and Materials sectors generally underperformed by comparison. Reflecting this backdrop, the Russell 2000 Index returned 16.6% for the report period and the MSCI EAFE Index (gross) returned 17.2%.

 Asset Class Performance Comparison % returns during the report period

This graph compares the performance of various asset classes during the report period. Final performance figures for the period are in the key below.

	14.42%	S&P 500® Index: measures U.S. large-cap stocks
	16.58%	Russell 2000® Index: measures U.S. small-cap stocks
	17.18%	MSCI EAFE® Index (Gross): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	0.90%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.04%	Three-Month U.S. Treasury Bills (T-bills): measures short-term U.S. Treasury obligations

Index figures assume dividends and distributions were reinvested, and do not include trading and management costs, which would lower performance. Indices are unmanaged, do not incur management fees, costs and expenses, and you cannot invest in them directly. Remember that past performance is not an indication of future results.

Data source: Index provider websites and CSIM.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views and portfolio holdings may have changed since the report date.

Laudus MarketMasters Funds 3

From the President continued

For the six months ended April 30, 2013, the returns of the funds reflected an environment that included a strong performance by small-cap U.S. stocks and by stocks in developed international markets.

For more information about the Laudus MarketMasters Funds, please continue reading this report. In addition, you can find answers to frequently asked questions and more details about the funds by visiting www.laudus.com. We are also happy to hear from you at 1-800-435-4000.

Sincerely,

4 Laudus MarketMasters Funds

Fund Management

Omar Aguilar, Senior Vice President and Chief Investment Officer of Equities of the investment adviser, manages the funds. Prior to joining the firm in April 2011, he was head of the portfolio management group and Vice President of Portfolio Management at a large retirement asset planning and management firm. From 2004 to 2009, he was Senior Vice President, Head of Quantitative Equity and Senior Portfolio Manager at a large banking and asset management firm. He has over 16 years of quantitative investment experience.

Laudus MarketMasters Funds 5

Laudus Small-Cap MarketMasters Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.laudus.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years			Since Inception
Investor Shares (9/16/97)		13.93	%		14.10	%		5.35	%		9.76	%	5.71%
Select Shares® (6/9/04)		14.03	%		14.29	%		5.50	%		n/a		5.78%
Russell 2000® Index		16.58	%		17.69	%		7.27	%		10.47	%	(9/16/97) 6.40%
													(6/9/04) 7.12%
Fund Category: Morningstar Small-Cap Growth		13.82	%		11.51	%		6.80	%		9.98	%	(9/16/97) 6.81%
													(6/9/04) 7.26%

Fund Expense Ratios³: Investor Shares: Net 1.36%; Gross 1.60% / Select Shares: Net 1.21%; Gross 1.52%

 Investment Managers and Allocations⁴

		% of
Investment Managers	Investment Style	Net Assets
TAMRO Capital Partners LLC	Small-Cap Blend		39.6	%
BMO Asset Management Corp.5	Small-Cap Growth		18.7	%
Mellon Capital Management Corp.	Small-Cap Blend		10.0	%
Wellington Management Company, LLP	Small-Cap Value		30.1	%
Cash and other assets	—		1.6	%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Because the fund originally used a multi-fund strategy, performance of the Investor Shares prior to June 3, 2002 does not reflect the current strategy and may have been different if it did.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	As stated in the prospectus. Includes acquired fund fees and expenses incurred indirectly by the fund through its investments in other investment companies. The annualized weighted average expense ratio of these investment companies was 0.01%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
4	For more information about each of the investment manager’s investment styles, refer to the fund’s prospectus.
5	On February 28, 2013, the fund’s Board of Trustees approved BMO Asset Management Corporation (BMO) as an additional new investment manager to the fund, replacing Neuberger Berman Management LLC. BMO began managing its portion of the fund’s assets on or around March 14, 2013.

6 Laudus MarketMasters Funds

 Laudus Small-Cap MarketMasters Fund^tm

Performance and Fund Facts as of 04/30/13 continued

 Statistics

Number of Holdings	1,396
Weighted Average Market Cap ($ x 1,000,000)	$1,820
Price/Earnings Ratio (P/E)	23.6
Price/Book Ratio (P/B)	2.1
Portfolio Turnover Rate1	64%

 Sector Weightings % of Investments

Financials	19.2%
Industrials	18.1%
Consumer Discretionary	16.5%
Health Care	12.5%
Information Technology	12.2%
Energy	6.5%
Consumer Staples	4.7%
Materials	3.3%
Utilities	2.5%
Telecommunication Services	0.4%
Other	4.1%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Unit Corp.	1.1%
Redwood Trust, Inc.	1.1%
Bank of the Ozarks, Inc.	1.1%
LaSalle Hotel Properties	1.0%
Colfax Corp.	1.0%
Chico’s FAS, Inc.	0.9%
Belden, Inc.	0.9%
athenahealth, Inc.	0.9%
The Advisory Board Co.	0.9%
Glacier Bancorp, Inc.	0.9%
Total	9.8%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Small-company stocks are subject to greater volatility than other asset classes.

1	Not annualized.
2	This list is not a recommendation of any security by the investment adviser.

Laudus MarketMasters Funds 7

Laudus International MarketMasters Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.laudus.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years			Since Inception
Investor Shares (10/16/96)		16.59	%		19.28	%		3.00	%		12.50	%	9.21%
Select Shares® (4/2/04)		16.72	%		19.48	%		3.15	%		n/a		8.84%
MSCI EAFE Index® (Gross)*		17.18	%		19.96	%		-0.44	%		9.72	%	(10/16/96) 5.22%
													(4/2/04) 6.26%
Fund Category: Morningstar Foreign Large-Cap Growth		12.05	%		12.06	%		0.03	%		9.63	%	(10/16/96) 6.20%
													(4/2/04) 6.31%

Fund Expense Ratios³: Investor Shares: Net 1.40%; Gross 1.62% / Select Shares: Net 1.25%; Gross 1.47%

 Investment Managers and Allocations⁴

		% of
Investment Managers	Investment Style	Net Assets
American Century Investment Management, Inc.	International Small/Mid-Cap Growth		18.1	%
WHV Investment Management/Hirayama Investments, LLC	International Large-Cap Growth		5.6	%
Harris Associates L.P.	International Large-Cap Value		23.2	%
William Blair & Company, LLC	International Multi-Cap Growth		20.1	%
Mondrian Investment Partners Limited	International Small-Cap Value		22.0	%
Mellon Capital Management Corp.	International Blend		9.4	%
Cash and other assets	—		1.6	%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Because the fund originally used a multi-fund strategy, performance of the Investor Shares prior to June 3, 2002 does not reflect the current strategy and may have been different if it did.

The fund’s performance relative to the index may be affected by fair-value pricing, see financial note 2 for more information.

*	The MSCI EAFE Index® is a free float-adjusted market capitalization index that is designed to measure market equity performance in 22 developed market countries, excluding the U.S. and Canada. Investors cannot invest directly in any index and index figures do not include trading and management costs.
1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	As stated in the prospectus. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
4	For more information about each of the investment manager’s investment styles, refer to the fund’s prospectus.

8 Laudus MarketMasters Funds

 Laudus International MarketMasters Fund^tm

Performance and Fund Facts as of 04/30/13 continued

 Statistics

Number of Holdings	1,233
Weighted Average Market Cap ($ x 1,000,000)	$26,704
Price/Earnings Ratio (P/E)	19.3
Price/Book Ratio (P/B)	1.3
Portfolio Turnover Rate1	33%

 Sector Weightings % of Investments

Industrials	20.4%
Financials	19.7%
Consumer Discretionary	16.0%
Information Technology	9.7%
Materials	9.6%
Consumer Staples	7.0%
Health Care	6.0%
Energy	4.7%
Telecommunication Services	2.1%
Utilities	1.0%
Other	3.8%
Total	100.0%

 Top Equity Holdings % of Net Assets²

Credit Suisse Group AG – Reg’d	1.4%
Rotork plc	1.0%
BNP Paribas S.A.	1.0%
Daimler AG – Reg’d	1.0%
Symrise AG	0.9%
Intesa Sanpaolo S.p.A.	0.9%
Lloyds Banking Group plc	0.8%
Allianz SE – Reg’d	0.8%
Honda Motor Co., Ltd.	0.8%
Croda International plc	0.7%
Total	9.3%

 Country Weightings % of Investments

United Kingdom	19.7%
Japan	15.9%
Switzerland	7.6%
Germany	7.5%
France	6.9%
Australia	5.6%
Canada	3.7%
Singapore	3.7%
United States	3.8%
Netherlands	3.1%
Hong Kong	2.9%
Other Countries	19.6%
Total	100.0%

Portfolio holdings may have changed since the report date.

Source of Sector Classification: S&P and MSCI.

Foreign securities can involve risks such as political and economic instability and currency risk. These risks may be greater in emerging markets.

1	Not annualized.
2	This list is not a recommendation of any security by the investment adviser.

Laudus MarketMasters Funds 9

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you incur two types of costs: transaction costs, such as redemption fees, and ongoing costs, such as management fees, transfer agent and shareholder services fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in a fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning November 1, 2012 and held through April 30, 2013.

Actual Return lines in the table below provide information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ¸ $1,000 = 8.6), then multiply the result by the number given for your fund or share class under the heading entitled “Expenses Paid During Period.”

Hypothetical Return lines in the table below provide information about hypothetical account values and hypothetical expenses based on a fund’s or share class’ actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as redemption fees. If these transactional costs were included, your costs would have been higher.

					Ending
			Beginning		Account Value		Expenses Paid
	Expense Ratio1		Account Value		(Net of Expenses)		During Period2
	(Annualized)		at 11/1/12		at 4/30/13		11/1/12–4/30/13
Laudus Small-Cap MarketMasters Fundtm
Investor Shares
Actual Return		1.35%	$	1,000	$	1,139.30	$	7.16
Hypothetical 5% Return		1.35%	$	1,000	$	1,018.10	$	6.76
Select Shares
Actual Return		1.20%	$	1,000	$	1,140.30	$	6.37
Hypothetical 5% Return		1.20%	$	1,000	$	1,018.84	$	6.01
Laudus International MarketMasters Fundtm
Investor Shares
Actual Return		1.40%	$	1,000	$	1,165.90	$	7.52
Hypothetical 5% Return		1.40%	$	1,000	$	1,017.85	$	7.00
Select Shares
Actual Return		1.25%	$	1,000	$	1,167.20	$	6.72
Hypothetical 5% Return		1.25%	$	1,000	$	1,018.60	$	6.26

1	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights.
2	Expenses for each fund or share class are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year.

10 Laudus MarketMasters Funds

Laudus Small-Cap MarketMasters Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
Investor Shares	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		13.14			11.99			11.52			9.40			8.78			13.74
Income (loss) from investment operations:
Net investment income (loss)		0.01	1		(0.10	)1		(0.09	)1		(0.08	)1		(0.05	)1		(0.04	)1
Net realized and unrealized gains (losses)		1.82			1.25			0.56			2.20			0.67			(4.59	)
Total from investment operations		1.83			1.15			0.47			2.12			0.62			(4.63	)
Less distributions:
Distributions from net investment income		—			—			—			—			(0.00	)2		—
Distributions from net realized gains		—			—			—			—			—			(0.33	)
Total distributions		—			—			—			—			(0.00	)2		(0.33	)
Net asset value at end of period		14.97			13.14			11.99			11.52			9.40			8.78
Total return (%)		13.93	3		9.59			4.08			22.55			7.10			(34.34	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.35	4		1.42	5		1.46			1.46			1.48	6		1.48
Gross operating expenses		1.58	4		1.59			1.51			1.50			1.50			1.48
Net investment income (loss)		0.14	4		(0.79	)		(0.70	)		(0.72	)		(0.64	)		(0.38	)
Portfolio turnover rate		64	3		144			95			78			129			134
Net assets, end of period ($ x 1,000,000)		69			65			62			68			64			64

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
Select Shares	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		13.33			12.14			11.64			9.49			8.86			13.85
Income (loss) from investment operations:
Net investment income (loss)		0.02	1		(0.08	)1		(0.07	)1		(0.06	)1		(0.04	)1		(0.04	)1
Net realized and unrealized gains (losses)		1.85			1.27			0.57			2.21			0.68			(4.62	)
Total from investment operations		1.87			1.19			0.50			2.15			0.64			(4.66	)
Less distributions:
Distributions from net investment income		—			—			—			—			(0.01	)		—
Distributions from net realized gains		—			—			—			—			—			(0.33	)
Total distributions		—			—			—			—			(0.01	)		(0.33	)
Net asset value at end of period		15.20			13.33			12.14			11.64			9.49			8.86
Total return (%)		14.03	3		9.80			4.30			22.66			7.29			(34.28	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.20	4		1.27	5		1.31			1.32	7		1.33	6		1.37
Gross operating expenses		1.51	4		1.51			1.45			1.45			1.45			1.44
Net investment income (loss)		0.28	4		(0.60	)		(0.54	)		(0.58	)		(0.48	)		(0.31	)
Portfolio turnover rate		64	3		144			95			78			129			134
Net assets, end of period ($ x 1,000,000)		102			88			219			337			292			260

* Unaudited.

¹ Calculated based on the average shares outstanding during the period.

² Per share amount was less than $0.01.

³ Not annualized.

⁴ Annualized.

⁵ Effective June 6, 2012, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/12 is a blended ratio.

⁶ Effective February 28, 2009, the operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁷ The ratio of net operating expenses would have been 1.31%, if certain non-routine expense had not been incurred.

See financial notes 11

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.laudus.com.

				Cost		Value
Holdings by Category				($)		($)
	95	.8%	Common Stock		136,961,159		163,678,200
	3	.9%	Other Investment Companies		6,544,288		6,583,222
	0	.3%	Short-Term Investments		494,942		494,942
	100	.0%	Total Investments		144,000,389		170,756,364
	0	.0%	Other Assets and Liabilities, Net				55,699
	100	.0%	Net Assets				170,812,063

	Number		Value
Security	of Shares		($)
Common Stock 95.8% of net assets
Automobiles & Components 0.1%
American Axle & Manufacturing Holdings, Inc. *		1,028		13,744
Cooper Tire & Rubber Co.		817		20,335
Dana Holding Corp.		2,028		34,983
Dorman Products, Inc.		200		7,548
Drew Industries, Inc.		170		6,137
Fuel Systems Solutions, Inc. *		223		3,503
Gentherm, Inc. *		278		4,234
Modine Manufacturing Co. *		840		7,678
Standard Motor Products, Inc.		198		6,067
Superior Industries International, Inc.		233		4,278
Tenneco, Inc. *		667		25,793
Winnebago Industries, Inc. *		587		10,754
				145,054
Banks 6.5%
1st Source Corp.		167		3,930
Astoria Financial Corp.		570		5,466
Banco Latinoamericano de Comercio Exterior, S.A., Class E		540		12,253
BancorpSouth, Inc.		1,539		24,624
Bank Mutual Corp.		891		4,615
Bank of the Ozarks, Inc.		44,485		1,820,771
Banner Corp.		363		11,859
BBCN Bancorp, Inc.		1,367		17,607
Berkshire Hills Bancorp, Inc.		188		4,862
BofI Holding, Inc. *		193		7,871
Boston Private Financial Holdings, Inc.		1,502		14,479
Brookline Bancorp, Inc.		662		5,561
BSB Bancorp, Inc. *		274		3,767
Cardinal Financial Corp.		710		10,827
Cathay General Bancorp		1,185		23,356
Chemical Financial Corp.		186		4,613
Citizens & Northern Corp.		377		7,299
City Holding Co.		117		4,467
Columbia Banking System, Inc.		860		18,464
Community Bank System, Inc.		576		16,497
Community Trust Bancorp, Inc.		325		11,251
CVB Financial Corp.		989		10,750
Dime Community Bancshares, Inc.		304		4,338
Eagle Bancorp, Inc. *		268		6,199
Enterprise Financial Services Corp.		341		4,904
ESSA Bancorp, Inc.		310		3,339
F.N.B. Corp.		1,926		21,937
Financial Institutions, Inc.		161		3,080
First Busey Corp.		66,409		285,559
First California Financial Group, Inc. *		958		7,731
First Commonwealth Financial Corp.		784		5,606
First Connecticut Bancorp, Inc.		446		6,619
First Financial Bancorp		1,005		15,447
First Financial Bankshares, Inc.		484		23,914
First Financial Corp.		124		3,830
First Midwest Bancorp, Inc.		55,325		694,329
First Niagara Financial Group, Inc.		53,300		506,883
Firstmerit Corp.		63,974		1,095,875
Flushing Financial Corp.		25,222		382,870
Fox Chase Bancorp, Inc.		185		3,128
Franklin Financial Corp.		185		3,363
Glacier Bancorp, Inc.		85,077		1,569,671
Great Southern Bancorp, Inc.		288		7,595
Hancock Holding Co.		16,342		445,646
Hanmi Financial Corp. *		706		10,894
Heritage Financial Corp.		278		3,878
Home Bancshares, Inc.		419		16,643
Home Loan Servicing Solutions Ltd.		505		11,438
HomeTrust Bancshares, Inc. *		599		9,554
IBERIABANK Corp.		420		19,160
Independent Bank Corp.		171		5,308
International Bancshares Corp.		40,510		785,894
Investors Bancorp, Inc.		564		11,167
Lakeland Financial Corp.		158		4,234
MB Financial, Inc.		21,163		523,996
Metro Bancorp, Inc. *		247		4,384
MGIC Investment Corp. *		2,739		14,791
National Bankshares, Inc.		94		3,078
National Penn Bancshares, Inc.		1,907		18,670
Nationstar Mortgage Holdings, Inc. *		160		5,883
NBT Bancorp, Inc.		552		11,178
Northwest Bancshares, Inc.		62,466		765,208
OceanFirst Financial Corp.		470		6,679
Ocwen Financial Corp. *		1,222		44,701
OFG Bancorp		942		15,138
Old National Bancorp		1,439		17,527
OmniAmerican Bancorp, Inc. *		193		4,806
Oritani Financial Corp.		860		13,304
PacWest Bancorp		542		15,030
Park National Corp.		92		6,291
Park Sterling Corp. *		898		5,146
Peoples Bancorp, Inc.		147		2,996
Pinnacle Financial Partners, Inc. *		641		15,557
PrivateBancorp, Inc.		978		18,758
Prosperity Bancshares, Inc.		645		29,631

12 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Provident Financial Holdings, Inc.		393		6,367
Provident Financial Services, Inc.		981		15,039
Radian Group, Inc.		2,729		32,612
Renasant Corp.		277		6,321
S&T Bancorp, Inc.		199		3,755
Sandy Spring Bancorp, Inc.		230		4,710
SCBT Financial Corp.		133		6,353
Simmons First National Corp., Class A		431		10,568
Simplicity Bancorp, Inc.		474		7,110
Southside Bancshares, Inc.		222		4,737
Southwest Bancorp, Inc. *		261		3,450
State Bank Financial Corp.		630		9,267
Sterling Bancorp		324		3,655
Sterling Financial Corp.		536		11,685
Susquehanna Bancshares, Inc.		2,590		30,225
Texas Capital Bancshares, Inc. *		529		22,038
The Bancorp, Inc. *		650		8,450
TriCo Bancshares		511		8,927
TrustCo Bank Corp.		1,765		9,460
Trustmark Corp.		908		22,291
UMB Financial Corp.		475		23,911
Umpqua Holdings Corp.		1,659		19,908
United Bankshares, Inc.		674		17,059
United Financial Bancorp, Inc.		475		7,035
ViewPoint Financial Group, Inc.		684		12,736
Washington Banking Co.		245		3,381
Webster Financial Corp.		38,223		893,272
WesBanco, Inc.		200		5,006
Westamerica Bancorp		5,828		252,877
Western Alliance Bancorp *		1,308		19,241
Westfield Financial, Inc.		414		3,117
Wilshire Bancorp, Inc. *		1,173		7,495
Wintrust Financial Corp.		539		19,329
				11,079,361
Capital Goods 10.3%
A.O. Smith Corp.		543		40,958
AAON, Inc.		212		6,023
AAR Corp.		612		10,930
Accuride Corp. *		1,081		5,556
Aceto Corp.		578		6,011
Actuant Corp., Class A		8,593		268,961
Acuity Brands, Inc.		6,749		492,407
Aegion Corp. *		602		12,678
Aerovironment, Inc. *		339		6,563
Aircastle Ltd.		931		12,997
Albany International Corp., Class A		35,094		1,019,481
Altra Holdings, Inc.		6,922		184,471
Ameresco, Inc., Class A *		681		5,019
American Science & Engineering, Inc.		132		8,511
Apogee Enterprises, Inc.		552		14,065
Applied Industrial Technologies, Inc.		598		25,266
Argan, Inc.		351		6,213
Astec Industries, Inc.		123		4,038
Astronics Corp. *		197		5,477
AZZ, Inc.		190		8,035
B/E Aerospace, Inc. *		5,320		333,777
Barnes Group, Inc.		804		22,327
Beacon Roofing Supply, Inc. *		650		24,785
Belden, Inc.		32,629		1,612,525
Blount International, Inc. *		806		11,195
Brady Corp., Class A		675		22,869
Briggs & Stratton Corp.		735		16,530
Capstone Turbine Corp. *		9,964		8,769
Carlisle Cos., Inc.		9,590		622,103
Chart Industries, Inc. *		6,420		544,480
Chicago Bridge & Iron Co., N.V., NY Shares		5,210		280,246
CIRCOR International, Inc.		136		6,437
CLARCOR, Inc.		626		32,364
Colfax Corp. *		35,827		1,672,046
Comfort Systems USA, Inc.		363		4,657
Cubic Corp.		13,495		579,880
Curtiss-Wright Corp.		628		20,624
DigitalGlobe, Inc. *		825		24,082
Douglas Dynamics, Inc.		621		8,688
DXP Enterprises, Inc. *		129		8,628
Dycom Industries, Inc. *		604		11,669
Dynamic Materials Corp.		194		3,081
Edgen Group, Inc. *		821		5,624
EMCOR Group, Inc.		904		33,810
Encore Wire Corp.		156		5,109
EnerSys, Inc. *		680		31,171
EnPro Industries, Inc. *		360		17,741
ESCO Technologies, Inc.		21,050		757,168
Esterline Technologies Corp. *		423		31,742
Federal Signal Corp. *		998		7,744
Franklin Electric Co., Inc.		35,096		1,136,058
FuelCell Energy, Inc. *		7,453		7,826
Furmanite Corp. *		517		3,283
GATX Corp.		18,500		942,575
GenCorp, Inc. *		1,156		15,109
Generac Holdings, Inc.		223		8,012
Gibraltar Industries, Inc. *		269		5,030
Global Power Equipment Group, Inc.		165		2,723
Graham Corp.		193		4,690
Granite Construction, Inc.		602		16,657
Great Lakes Dredge & Dock Corp.		907		6,276
Griffon Corp.		404		4,161
H&E Equipment Services, Inc.		411		8,368
HEICO Corp.		702		30,895
Hexcel Corp. *		15,338		467,809
Houston Wire & Cable Co.		288		3,923
Hyster-Yale Materials Handling, Inc.		88		4,593
II-VI, Inc. *		798		12,345
John Bean Technologies Corp.		586		12,154
Kadant, Inc.		176		4,870
Kaman Corp.		176		5,947
Kaydon Corp.		623		14,852
Kratos Defense & Security Solutions, Inc. *		818		4,164
Layne Christensen Co. *		382		7,804
Lennox International, Inc.		2,940		182,280
Lindsay Corp.		215		16,516
Lydall, Inc. *		323		4,632
MasTec, Inc. *		765		21,267
Meritor, Inc. *		629		3,648
Middleby Corp. *		214		32,010
Miller Industries, Inc.		263		3,974
Moog, Inc., Class A *		513		23,706
Mueller Industries, Inc.		26,536		1,374,034
Mueller Water Products, Inc., Class A		1,519		8,992
MYR Group, Inc. *		305		6,954

See financial notes 13

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
NCI Building Systems, Inc. *		471		8,064
Nortek, Inc. *		45		3,234
Orbital Sciences Corp. *		934		16,831
PMFG, Inc. *		210		1,210
Powell Industries, Inc. *		43		2,117
Primoris Services Corp.		575		12,673
Quanex Building Products Corp.		687		11,177
Raven Industries, Inc.		11,284		378,578
RBC Bearings, Inc. *		163		7,840
Rexnord Corp. *		277		5,047
Rush Enterprises, Inc., Class A *		275		6,295
Simpson Manufacturing Co., Inc.		565		16,238
Standex International Corp.		110		5,819
Sun Hydraulics Corp.		156		5,109
TAL International Group, Inc.		421		17,429
Taser International, Inc. *		1,162		10,237
Teledyne Technologies, Inc. *		502		37,680
Tennant Co.		211		10,090
Textainer Group Holdings Ltd.		148		5,723
The Gorman-Rupp Co.		143		4,040
The Greenbrier Cos., Inc. *		274		6,181
The Manitowoc Co., Inc.		11,550		216,678
Thermon Group Holdings, Inc. *		245		4,802
Titan International, Inc.		60,092		1,340,653
Titan Machinery, Inc. *		270		6,091
Trex Co., Inc. *		174		8,470
TriMas Corp. *		9,709		296,125
Triumph Group, Inc.		5,810		464,219
Tutor Perini Corp. *		625		10,275
Twin Disc, Inc.		334		7,121
United Rentals, Inc. *		6,610		347,752
Universal Forest Products, Inc.		133		5,134
USG Corp. *		1,029		26,744
Wabash National Corp. *		916		8,638
Wabtec Corp.		6,671		700,055
Watsco, Inc.		2,988		252,127
Watts Water Technologies, Inc., Class A		462		21,742
Woodward, Inc.		878		31,599
				17,633,505
Commercial & Professional Supplies 4.8%
ABM Industries, Inc.		690		15,559
Acacia Research Corp. *		49,963		1,190,119
Acco Brands Corp. *		95,682		645,853
Barrett Business Services, Inc.		154		8,153
Casella Waste Systems, Inc., Class A *		1,111		4,844
CBIZ, Inc. *		1,342		8,710
Consolidated Graphics, Inc. *		89		3,175
Deluxe Corp.		749		28,567
EnergySolutions, Inc. *		1,191		4,919
EnerNOC, Inc. *		560		9,811
Ennis, Inc.		287		4,411
Exponent, Inc.		89		4,690
FTI Consulting, Inc. *		589		19,508
G&K Services, Inc., Class A		21,143		993,510
GP Strategies Corp. *		298		6,571
Healthcare Services Group, Inc.		1,005		22,401
Herman Miller, Inc.		593		14,878
HNI Corp.		637		21,932
Huron Consulting Group, Inc. *		369		15,417
ICF International, Inc. *		382		10,356
InnerWorkings, Inc. *		698		7,029
Insperity, Inc.		419		11,577
Interface, Inc.		1,022		17,108
Intersections, Inc.		341		3,260
Kelly Services, Inc., Class A		381		6,485
Kforce, Inc.		663		10,025
Kimball International, Inc., Class B		165		1,516
Knoll, Inc.		699		10,876
Korn/Ferry International *		875		14,481
McGrath RentCorp		2,552		79,265
Mine Safety Appliances Co.		375		18,000
Mistras Group, Inc. *		196		3,714
Mobile Mini, Inc. *		296		8,326
Navigant Consulting, Inc. *		878		10,826
On Assignment, Inc. *		12,435		301,797
Pendrell Corp. *		1,575		2,662
Quad Graphics, Inc.		332		6,939
Resources Connection, Inc.		916		10,406
Standard Parking Corp. *		27,100		582,379
Steelcase, Inc., Class A		743		9,436
Team, Inc. *		369		14,302
Tetra Tech, Inc. *		816		21,453
The Advisory Board Co. *		32,196		1,582,433
The Brink’s Co.		692		18,345
The Corporate Executive Board Co.		22,683		1,278,414
TMS International Corp., Class A *		481		6,946
TrueBlue, Inc. *		715		14,815
UniFirst Corp.		132		12,019
United Stationers, Inc.		32,532		1,056,314
Viad Corp.		380		9,899
				8,164,431
Consumer Durables & Apparel 4.0%
American Greetings Corp., Class A		595		10,972
Arctic Cat, Inc. *		17,669		794,928
Blyth, Inc.		403		6,641
Brunswick Corp.		1,185		37,517
Callaway Golf Co.		1,416		9,487
Columbia Sportswear Co.		228		13,361
Crocs, Inc. *		1,321		21,162
CSS Industries, Inc.		196		5,617
Ethan Allen Interiors, Inc.		459		13,440
Fifth & Pacific Cos., Inc. *		1,271		26,208
G-III Apparel Group Ltd. *		361		14,678
Harman International Industries, Inc.		29,826		1,333,520
Helen of Troy Ltd. *		24,987		871,547
Hovnanian Enterprises, Inc., Class A *		498		2,714
Iconix Brand Group, Inc. *		762		21,831
iRobot Corp. *		262		7,622
JAKKS Pacific, Inc.		714		7,790
KB Home		1,166		26,282
La-Z-Boy, Inc.		318		5,743
LeapFrog Enterprises, Inc. *		1,107		9,897
M.D.C. Holdings, Inc.		39,050		1,468,280
M/I Homes, Inc. *		118		2,903
Maidenform Brands, Inc. *		486		8,748
Meritage Homes Corp. *		482		23,517
Movado Group, Inc.		234		7,076
NACCO Industries, Inc., Class A		44		2,553

14 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Oxford Industries, Inc.		234		13,836
Perry Ellis International, Inc.		402		7,063
Quiksilver, Inc. *		989		6,656
Skechers U.S.A., Inc., Class A *		669		13,902
Skullcandy, Inc. *		1,083		5,567
Smith & Wesson Holding Corp. *		945		8,297
Standard Pacific Corp. *		1,079		9,765
Steven Madden Ltd. *		473		23,002
Sturm, Ruger & Co., Inc.		143		7,332
Tempur-Pedic International, Inc. *		29,191		1,415,763
The Jones Group, Inc.		796		11,144
The Ryland Group, Inc.		695		31,317
True Religion Apparel, Inc.		421		11,392
Tumi Holdings, Inc. *		17,132		394,550
Vera Bradley, Inc. *		351		8,010
Wolverine World Wide, Inc.		530		25,318
Zagg, Inc. *		972		6,580
				6,753,528
Consumer Services 4.8%
AFC Enterprises, Inc. *		295		9,405
American Public Education, Inc. *		344		11,534
Ameristar Casinos, Inc.		577		15,227
Ascent Capital Group, Inc., Class A *		89		5,918
Biglari Holdings, Inc. *		971		376,049
BJ’s Restaurants, Inc. *		22,766		780,874
Bob Evans Farms, Inc.		412		17,856
Boyd Gaming Corp. *		838		10,056
Bravo Brio Restaurant Group, Inc. *		556		9,452
Bridgepoint Education, Inc. *		169		1,822
Buffalo Wild Wings, Inc. *		278		25,020
Caesars Entertainment Corp. *		198		3,150
Capella Education Co. *		265		9,386
CEC Entertainment, Inc.		24,632		821,970
Choice Hotels International, Inc.		5,600		218,736
Churchill Downs, Inc.		78		5,964
Coinstar, Inc. *		3,545		187,212
Corinthian Colleges, Inc. *		1,452		2,904
Cracker Barrel Old Country Store, Inc.		275		22,754
Denny’s Corp. *		1,027		5,823
DineEquity, Inc.		126		8,976
Domino’s Pizza, Inc.		623		34,390
Grand Canyon Education, Inc. *		55,573		1,421,002
Hillenbrand, Inc.		654		16,435
Ignite Restaurant Group, Inc. *		9,292		162,053
International Speedway Corp., Class A		500		16,435
Interval Leisure Group, Inc.		313		5,966
Jack in the Box, Inc. *		629		22,550
K12, Inc. *		484		12,328
Krispy Kreme Doughnuts, Inc. *		638		8,715
LIFE TIME FITNESS, Inc. *		580		26,784
LifeLock, Inc. *		22,680		204,120
Lincoln Educational Services Corp.		751		4,183
Marcus Corp.		479		6,150
Marriott Vacations Worldwide Corp. *		253		11,506
Matthews International Corp., Class A		22,210		817,550
Multimedia Games Holding Co., Inc. *		642		15,832
Orient-Express Hotels Ltd., Class A *		1,614		16,301
Papa John’s International, Inc. *		216		13,608
Pinnacle Entertainment, Inc. *		404		7,700
Red Lion Hotels Corp. *		331		2,161
Red Robin Gourmet Burgers, Inc. *		24,120		1,166,684
Regis Corp.		927		17,381
Ruby Tuesday, Inc. *		766		7,384
Ruth’s Hospitality Group, Inc. *		699		6,927
Scientific Games Corp., Class A *		564		5,008
SHFL Entertainment, Inc. *		798		12,608
Six Flags Entertainment Corp.		490		35,706
Sonic Corp. *		749		9,385
Sotheby’s		713		25,297
Steiner Leisure Ltd. *		92		4,456
Stewart Enterprises, Inc., Class A		708		6,308
Strayer Education, Inc.		108		5,115
Texas Roadhouse, Inc.		59,434		1,396,699
The Cheesecake Factory, Inc.		815		32,453
Universal Technical Institute, Inc.		534		6,339
Vail Resorts, Inc.		346		20,864
WMS Industries, Inc. *		624		15,837
				8,150,308
Diversified Financials 6.0%
American Capital Ltd. *		79,080		1,196,480
Apollo Investment Corp.		2,835		24,976
Arlington Asset Investment Corp., Class A		355		9,617
Artio Global Investors, Inc.		947		2,595
BGC Partners, Inc., Class A		949		5,428
BlackRock Kelso Capital Corp.		1,294		12,875
Calamos Asset Management, Inc., Class A		689		7,820
Cash America International, Inc.		385		16,798
Cohen & Steers, Inc.		135		5,334
Credit Acceptance Corp. *		80		8,026
DFC Global Corp. *		729		9,842
Encore Capital Group, Inc. *		184		5,242
Evercore Partners, Inc., Class A		390		14,723
Ezcorp, Inc., Class A *		574		9,701
FBR & Co. *		184		3,833
Fifth Street Finance Corp.		1,407		15,533
Financial Engines, Inc.		721		26,223
First Cash Financial Services, Inc. *		28,500		1,466,895
FXCM, Inc., Class A		625		8,469
GFI Group, Inc.		943		3,781
Gladstone Capital Corp.		406		3,764
Gladstone Investment Corp.		774		5,759
Green Dot Corp., Class A *		689		10,824
Greenhill & Co., Inc.		26,150		1,207,868
GSV Capital Corp. *		762		5,860
Hercules Technology Growth Capital, Inc.		939		12,489
HFF, Inc., Class A		301		6,306
Horizon Technology Finance Corp.		383		5,626
ICG Group, Inc. *		52,450		622,582
INTL FCStone, Inc. *		177		3,030
Investment Technology Group, Inc. *		987		10,748
KCAP Financial, Inc.		861		9,316
Knight Capital Group, Inc., Class A *		1,669		5,908
Main Street Capital Corp.		456		13,707
Manning & Napier, Inc.		477		8,352
MarketAxess Holdings, Inc.		468		19,806
MCG Capital Corp.		1,905		9,792

See financial notes 15

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Medallion Financial Corp.		469		7,007
Medley Capital Corp.		614		9,566
MVC Capital, Inc.		721		9,366
Nelnet, Inc., Class A		172		5,848
Netspend Holdings, Inc. *		723		11,539
New Mountain Finance Corp.		482		7,346
PennantPark Investment Corp.		1,201		14,052
PHH Corp. *		779		16,421
PICO Holdings, Inc. *		50,359		1,092,790
Piper Jaffray Cos., Inc. *		312		10,533
Portfolio Recovery Associates, Inc. *		11,039		1,355,037
Prospect Capital Corp.		2,065		22,777
Safeguard Scientifics, Inc. *		48,751		786,841
Solar Capital Ltd.		608		14,549
Solar Senior Capital Ltd.		404		7,745
Stellus Capital Investment Corp.		109		1,668
Stifel Financial Corp. *		31,325		1,009,291
TCP Capital Corp.		350		5,485
THL Credit, Inc.		376		5,783
TICC Capital Corp.		806		8,197
Triangle Capital Corp.		472		13,202
Virtus Investment Partners, Inc. *		53		10,123
Waddell & Reed Financial, Inc., Class A		24,405		1,046,242
Walter Investment Management Corp. *		318		10,672
WisdomTree Investments, Inc. *		268		3,109
World Acceptance Corp. *		180		15,995
				10,317,112
Energy 6.5%
Advantage Oil & Gas Ltd. *		88,738		352,290
Alon USA Energy, Inc.		425		7,055
Amyris, Inc. *		611		1,662
Apco Oil & Gas International, Inc. *		55		556
Approach Resources, Inc. *		51,170		1,213,752
Arch Coal, Inc.		2,625		12,731
Basic Energy Services, Inc. *		520		7,140
Berry Petroleum Co., Class A		613		29,369
Bill Barrett Corp. *		690		13,703
BPZ Resources, Inc. *		1,313		2,810
Bristow Group, Inc.		4,345		274,604
C&J Energy Services, Inc. *		525		10,390
Callon Petroleum Co. *		775		2,774
Carrizo Oil & Gas, Inc. *		686		16,615
Clayton Williams Energy, Inc. *		1,672		64,539
Clean Energy Fuels Corp. *		957		12,623
Cloud Peak Energy, Inc. *		66,580		1,300,973
Comstock Resources, Inc. *		678		10,617
Contango Oil & Gas Co.		98		3,687
Crosstex Energy, Inc.		733		13,495
CVR Energy, Inc.		292		14,387
Delek US Holdings, Inc.		120		4,331
Diamondback Energy, Inc. *		10,600		278,356
Dril-Quip, Inc. *		532		44,534
Endeavour International Corp. *		1,303		3,570
Energy XXI (Bermuda) Ltd.		1,071		24,355
EPL Oil & Gas, Inc. *		533		17,413
Era Group, Inc. *		19,090		436,206
Evolution Petroleum Corp. *		368		3,658
Exterran Holdings, Inc. *		885		23,382
Forest Oil Corp. *		1,042		4,366
Forum Energy Technologies, Inc. *		266		7,397
Frontline Ltd. *		849		1,545
FX Energy, Inc. *		1,211		4,650
Geospace Technologies Corp. *		127		10,715
Global Geophysical Services, Inc. *		365		1,329
Goodrich Petroleum Corp. *		697		9,089
Green Plains Renewable Energy, Inc. *		707		8,845
Gulf Island Fabrication, Inc.		137		2,817
GulfMark Offshore, Inc., Class A		448		18,646
Gulfport Energy Corp. *		887		46,292
Halcon Resources Corp. *		26,875		175,762
Harvest Natural Resources, Inc. *		1,353		4,438
Heckmann Corp. *		1,174		4,332
Helix Energy Solutions Group, Inc. *		1,127		25,966
Hercules Offshore, Inc. *		1,181		8,704
Hornbeck Offshore Services, Inc. *		476		21,382
ION Geophysical Corp. *		1,487		9,279
Key Energy Services, Inc. *		1,733		10,294
Knightsbridge Tankers Ltd.		1,099		7,528
Kodiak Oil & Gas Corp. *		3,462		27,107
Laredo Petroleum Holdings, Inc. *		37,090		637,948
Lufkin Industries, Inc.		375		33,109
Magnum Hunter Resources Corp. *		1,297		3,528
Matrix Service Co. *		655		9,845
McMoRan Exploration Co. *		1,362		22,541
Mitcham Industries, Inc. *		316		4,693
Natural Gas Services Group, Inc. *		273		5,512
Newpark Resources, Inc. *		976		10,248
Nordic American Tankers Ltd.		851		7,582
Northern Oil & Gas, Inc. *		674		8,688
Oasis Petroleum, Inc. *		1,013		34,675
Parker Drilling Co. *		1,022		4,211
PDC Energy, Inc. *		405		17,536
Penn Virginia Corp.		148,273		597,540
PetroQuest Energy, Inc. *		764		3,270
PHI, Inc. - Non Voting Shares *		154		4,277
Pioneer Energy Services Corp. *		762		5,372
Precision Drilling Corp.		70,441		570,572
Quicksilver Resources, Inc. *		828		2,087
Rentech, Inc.		2,658		5,502
Resolute Energy Corp. *		676		6,233
Rex Energy Corp. *		792		12,727
Rosetta Resources, Inc. *		727		31,196
Scorpio Tankers, Inc. *		99,480		860,502
SEACOR Holdings, Inc.		21,601		1,557,648
SemGroup Corp., Class A *		637		33,028
Ship Finance International Ltd.		846		13,942
Solazyme, Inc. *		249		2,266
Stone Energy Corp. *		671		13,239
Swift Energy Co. *		615		7,958
T.G.C. Industries, Inc.		742		6,585
Targa Resources Corp.		315		20,714
Teekay Tankers Ltd., Class A		1,281		3,241
Tesco Corp. *		617		7,527
TETRA Technologies, Inc. *		724		6,610
Triangle Petroleum Corp. *		1,061		5,825
Unit Corp. *		46,279		1,945,106
Uranium Energy Corp. *		1,212		1,879
VAALCO Energy, Inc. *		727		4,885
W&T Offshore, Inc.		463		5,408

16 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Warren Resources, Inc. *		1,494		3,929
Western Refining, Inc.		722		22,317
Willbros Group, Inc. *		1,078		10,241
				11,183,802
Food & Staples Retailing 1.4%
Casey’s General Stores, Inc.		12,121		701,927
Harris Teeter Supermarkets, Inc.		589		24,614
Nash Finch Co.		140		2,877
PriceSmart, Inc.		184		16,418
Rite Aid Corp. *		6,692		17,734
Spartan Stores, Inc.		274		4,598
SUPERVALU, Inc.		1,788		10,442
Susser Holdings Corp. *		215		11,432
The Andersons, Inc.		312		17,010
The Fresh Market, Inc. *		4,040		165,357
The Pantry, Inc. *		590		8,620
United Natural Foods, Inc. *		28,401		1,418,346
Village Super Market, Inc., Class A		208		7,322
Weis Markets, Inc.		99		4,141
				2,410,838
Food, Beverage & Tobacco 3.3%
Annie’s, Inc. *		138		5,215
B&G Foods, Inc.		714		22,034
Boulder Brands, Inc. *		1,148		10,343
Cal-Maine Foods, Inc.		152		6,487
Chiquita Brands International, Inc. *		1,036		8,941
Cott Corp.		121,148		1,326,571
Darling International, Inc. *		1,618		29,949
Diamond Foods, Inc. *		654		9,862
Dole Food Co., Inc. *		553		5,950
Fresh Del Monte Produce, Inc.		595		15,119
J&J Snack Foods Corp.		97		7,277
Lancaster Colony Corp.		278		21,943
National Beverage Corp.		228		3,358
Pilgrim’s Pride Corp. *		845		8,273
Post Holdings, Inc. *		10,150		444,468
Sanderson Farms, Inc.		21,914		1,342,452
Seaboard Corp.		2		5,492
Snyders-Lance, Inc.		733		18,457
The Boston Beer Co., Inc., Class A *		115		19,472
The Hain Celestial Group, Inc. *		5,429		354,242
Tootsie Roll Industries, Inc.		32,908		1,027,717
TreeHouse Foods, Inc. *		13,153		837,978
Universal Corp.		361		20,776
Vector Group Ltd.		836		13,635
				5,566,011
Health Care Equipment & Services 8.8%
Abaxis, Inc.		408		17,418
ABIOMED, Inc. *		9,487		175,225
Acadia Healthcare Co., Inc. *		12,010		378,915
Accretive Health, Inc. *		626		6,598
Accuray, Inc. *		991		4,360
Air Methods Corp.		408		14,929
Align Technology, Inc. *		940		31,133
Allscripts Healthcare Solutions, Inc. *		12,300		170,232
Almost Family, Inc.		319		6,297
Amedisys, Inc. *		709		7,118
AMN Healthcare Services, Inc. *		256		3,515
AmSurg Corp. *		27,025		906,959
Analogic Corp.		18,052		1,434,773
AngioDynamics, Inc. *		540		5,470
Antares Pharma, Inc. *		750		2,842
ArthroCare Corp. *		454		15,731
Assisted Living Concepts, Inc., Class A		407		4,851
athenahealth, Inc. *		16,460		1,584,440
AtriCure, Inc. *		446		3,720
Atrion Corp.		18		3,607
Bio-Reference Laboratories, Inc. *		408		10,404
Biolase, Inc. *		30,070		159,371
BioScrip, Inc. *		9,038		125,267
Cantel Medical Corp.		196		6,196
Capital Senior Living Corp. *		175		4,245
Centene Corp. *		7,097		327,881
Chemed Corp.		304		24,812
Computer Programs & Systems, Inc.		209		10,964
Conceptus, Inc. *		428		13,272
CONMED Corp.		474		14,850
CorVel Corp. *		8,600		408,242
CryoLife, Inc.		266		1,596
Cyberonics, Inc. *		449		19,496
Cynosure, Inc., Class A *		56		1,448
DexCom, Inc. *		94,299		1,547,447
Emeritus Corp. *		10,632		273,242
Endologix, Inc. *		16,478		247,500
ExamWorks Group, Inc. *		297		5,376
Gentiva Health Services, Inc. *		688		7,217
Greatbatch, Inc. *		463		12,936
Haemonetics Corp. *		3,526		135,751
Hanger, Inc. *		606		18,416
Health Management Associates, Inc., Class A *		82,213		944,627
HealthSouth Corp. *		8,154		224,235
HealthStream, Inc. *		236		5,419
Healthways, Inc. *		898		12,473
HeartWare International, Inc. *		144		13,997
HMS Holdings Corp. *		57,984		1,461,777
ICU Medical, Inc. *		12,834		773,248
Insulet Corp. *		11,023		278,221
Integra LifeSciences Holdings Corp. *		303		10,614
Invacare Corp.		587		7,895
IPC The Hospitalist Co., Inc. *		160		7,299
Kindred Healthcare, Inc. *		372		3,902
Landauer, Inc.		74		4,134
LHC Group, Inc. *		329		7,146
Magellan Health Services, Inc. *		249		12,739
MAKO Surgical Corp. *		590		6,248
Masimo Corp.		717		14,383
MedAssets, Inc. *		683		12,793
Medidata Solutions, Inc. *		315		20,903
MEDNAX, Inc. *		4,140		367,342
Merge Healthcare, Inc. *		1,173		3,660
Meridian Bioscience, Inc.		687		13,939
Merit Medical Systems, Inc. *		791		7,649
Molina Healthcare, Inc. *		333		11,056
MWI Veterinary Supply, Inc. *		129		15,185
National Healthcare Corp.		93		4,318
Natus Medical, Inc. *		707		8,845

See financial notes 17

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Neogen Corp. *		172		8,743
NuVasive, Inc. *		555		11,638
NxStage Medical, Inc. *		9,408		105,087
Omnicell, Inc. *		632		11,389
OraSure Technologies, Inc. *		921		4,108
Orthofix International N.V. *		107		3,467
Owens & Minor, Inc.		910		29,639
PharMerica Corp. *		487		6,277
Quality Systems, Inc.		584		10,436
Quidel Corp. *		607		13,548
Rockwell Medical, Inc. *		418		1,772
Select Medical Holdings Corp.		656		5,412
Spectranetics Corp. *		680		12,682
STAAR Surgical Co. *		395		2,757
STERIS Corp.		15,118		628,758
SurModics, Inc. *		218		5,766
Symmetry Medical, Inc. *		969		11,550
Team Health Holdings, Inc. *		509		18,976
Teleflex, Inc.		16,220		1,267,269
The Ensign Group, Inc.		165		5,754
The Providence Service Corp. *		286		5,008
Thoratec Corp. *		7,250		262,450
Triple-S Management Corp., Class B *		424		7,645
Universal American Corp.		375		3,206
Vascular Solutions, Inc. *		395		6,284
Volcano Corp. *		804		16,313
WellCare Health Plans, Inc. *		451		26,298
West Pharmaceutical Services, Inc.		423		27,013
Wright Medical Group, Inc. *		704		16,502
				14,943,856
Household & Personal Products 0.0%
Central Garden & Pet Co., Class A *		440		3,872
Elizabeth Arden, Inc. *		249		10,197
Medifast, Inc. *		317		8,305
Orchids Paper Products Co.		165		3,795
Prestige Brands Holdings, Inc. *		755		20,347
Spectrum Brands Holdings, Inc.		336		18,816
Star Scientific, Inc. *		1,181		1,465
USANA Health Sciences, Inc. *		138		7,786
WD-40 Co.		99		5,339
				79,922
Insurance 1.8%
Alterra Capital Holdings Ltd.		1,229		40,004
American Equity Investment Life Holding Co.		1,010		15,392
American Safety Insurance Holdings Ltd. *		353		8,500
AMERISAFE, Inc.		13,381		437,023
AmTrust Financial Services, Inc.		485		15,355
Argo Group International Holdings Ltd.		467		19,357
Assured Guaranty Ltd.		26,500		546,695
Citizens, Inc. *		419		2,740
CNO Financial Group, Inc.		2,377		26,908
eHealth, Inc. *		437		9,151
Employers Holdings, Inc.		543		12,299
Enstar Group Ltd. *		83		10,549
FBL Financial Group, Inc., Class A		152		5,975
First American Financial Corp.		1,317		35,256
Greenlight Capital Re Ltd., Class A *		491		12,084
Hilltop Holdings, Inc. *		635		8,503
Homeowners Choice, Inc.		311		8,254
Horace Mann Educators Corp.		728		16,416
Infinity Property & Casualty Corp.		74		4,199
Maiden Holdings Ltd.		628		6,487
Meadowbrook Insurance Group, Inc.		979		7,617
Montpelier Re Holdings Ltd.		694		17,877
National Financial Partners Corp. *		15,358		389,172
OneBeacon Insurance Group Ltd., Class A		638		8,670
Platinum Underwriters Holdings Ltd.		9,613		545,538
Primerica, Inc.		22,587		767,055
RLI Corp.		269		19,328
Safety Insurance Group, Inc.		100		4,967
Selective Insurance Group, Inc.		861		20,173
Stewart Information Services Corp.		419		11,342
Symetra Financial Corp.		1,224		16,683
The Navigators Group, Inc. *		89		5,151
Tower Group International Ltd.		705		13,339
United Fire Group, Inc.		216		6,039
				3,074,098
Materials 3.3%
A. Schulman, Inc.		536		13,920
A.M. Castle & Co. *		579		10,028
AK Steel Holding Corp.		2,009		6,730
AMCOL International Corp.		426		13,108
American Vanguard Corp.		404		11,651
AptarGroup, Inc.		13,000		729,300
Arabian American Development Co. *		682		5,190
Axiall Corp.		874		45,841
Balchem Corp.		442		19,156
Berry Plastics Group, Inc. *		194		3,686
Boise, Inc.		1,320		10,547
Buckeye Technologies, Inc.		577		21,689
Calgon Carbon Corp. *		747		12,729
Century Aluminum Co. *		969		7,907
Chemtura Corp. *		1,191		25,321
Clearwater Paper Corp. *		378		17,396
Coeur d’Alene Mines Corp. *		1,298		19,781
Deltic Timber Corp.		10,166		635,172
Eagle Materials, Inc.		659		44,647
Ferro Corp. *		1,023		7,202
Flotek Industries, Inc. *		880		14,115
FutureFuel Corp.		348		4,263
General Moly, Inc. *		1,289		2,398
Globe Specialty Metals, Inc.		678		8,855
Gold Resource Corp.		374		3,830
Golden Star Resources Ltd. *		2,257		2,438
Graphic Packaging Holding Co. *		1,530		11,506
Greif, Inc., Class A		8,800		423,896
H.B. Fuller Co.		728		27,591
Haynes International, Inc.		111		5,396
Headwaters, Inc. *		395		4,290
Hecla Mining Co.		2,963		10,074
Horsehead Holding Corp. *		873		9,341
Innophos Holdings, Inc.		339		17,394
Innospec, Inc.		16,159		711,158
Kaiser Aluminum Corp.		195		12,285

18 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
KapStone Paper & Packaging Corp.		645		19,079
Koppers Holdings, Inc.		10,748		471,945
Kraton Performance Polymers, Inc. *		526		11,945
Landec Corp. *		585		7,845
Louisiana-Pacific Corp. *		1,943		35,207
LSB Industries, Inc. *		23,315		761,468
Materion Corp.		153		4,053
McEwen Mining, Inc. *		2,019		4,704
Minerals Technologies, Inc.		298		12,108
Myers Industries, Inc.		598		8,862
Neenah Paper, Inc.		178		5,119
Noranda Aluminum Holding Corp.		508		1,935
Olin Corp.		1,038		25,088
OM Group, Inc. *		512		12,529
P.H. Glatfelter Co.		627		15,048
PolyOne Corp.		1,219		27,464
Quaker Chemical Corp.		100		6,172
Resolute Forest Products *		773		11,309
RTI International Metals, Inc. *		532		15,439
Schnitzer Steel Industries, Inc., Class A		373		9,150
Schweitzer-Mauduit International, Inc.		284		11,442
Sensient Technologies Corp.		12,588		495,338
Stepan Co.		149		8,484
Stillwater Mining Co. *		1,215		15,115
SunCoke Energy, Inc. *		1,128		17,067
Texas Industries, Inc. *		321		20,441
Tredegar Corp.		361		10,686
Universal Stainless & Alloy Products, Inc. *		115		4,020
Wausau Paper Corp.		1,052		10,709
Worthington Industries, Inc.		699		22,494
Zep, Inc.		39,706		603,531
Zoltek Cos., Inc. *		696		9,194
				5,624,821
Media 2.2%
Arbitron, Inc.		16,130		753,110
Belo Corp., Class A		789		8,458
Carmike Cinemas, Inc. *		563		9,886
Central European Media Enterprises Ltd., Class A *		775		2,868
Digital Generation, Inc. *		697		4,670
Entercom Communications Corp., Class A *		797		6,304
Fisher Communications, Inc.		222		9,195
Harte-Hanks, Inc.		1,272		10,087
Journal Communications, Inc., Class A *		904		6,156
Lions Gate Entertainment Corp. *		15,069		373,862
Live Nation Entertainment, Inc. *		1,257		15,876
Loral Space & Communications, Inc.		67		4,122
Meredith Corp.		551		21,390
Morningstar, Inc.		18,243		1,204,221
National CineMedia, Inc.		417		6,772
Nexstar Broadcasting Group, Inc., Class A		341		8,303
Saga Communications, Inc., Class A		90		4,144
Scholastic Corp.		454		12,462
Sinclair Broadcast Group, Inc., Class A		12,209		327,201
The E.W. Scripps Co., Class A *		72,680		1,009,525
The New York Times Co., Class A *		1,084		9,604
Valassis Communications, Inc.		705		18,069
World Wrestling Entertainment, Inc., Class A		1,030		9,456
				3,835,741
Pharmaceuticals, Biotechnology & Life Sciences 3.7%
Achillion Pharmaceuticals, Inc. *		937		7,065
Acorda Therapeutics, Inc. *		622		24,613
Aegerion Pharmaceuticals, Inc. *		212		8,912
Affymax, Inc. *		576		518
Affymetrix, Inc. *		895		3,258
Akorn, Inc. *		25,142		378,387
Alkermes plc *		1,682		51,486
Alnylam Pharmaceuticals, Inc. *		844		20,214
AMAG Pharmaceuticals, Inc. *		395		8,710
Arena Pharmaceuticals, Inc. *		2,838		23,385
ArQule, Inc. *		769		2,269
Array BioPharma, Inc. *		758		4,510
Astex Pharmaceuticals *		493		3,392
Auxilium Pharmaceuticals, Inc. *		772		11,526
AVANIR Pharmaceuticals, Inc., Class A *		1,614		5,149
AVEO Pharmaceuticals, Inc. *		805		4,114
BioDelivery Sciences International, Inc. *		653		3,709
Cadence Pharmaceuticals, Inc. *		1,048		7,420
Cambrex Corp. *		771		9,630
Celldex Therapeutics, Inc. *		595		7,765
Cepheid, Inc. *		26,655		1,016,355
Charles River Laboratories International, Inc. *		28,600		1,243,814
Coronado Biosciences, Inc. *		709		7,976
Cubist Pharmaceuticals, Inc. *		862		39,583
Curis, Inc. *		2,066		7,747
Dendreon Corp. *		2,516		11,850
DepoMed, Inc. *		1,372		7,560
Dynavax Technologies Corp. *		2,128		5,001
Emergent Biosolutions, Inc. *		676		10,370
Endocyte, Inc. *		700		9,723
Enzon Pharmaceuticals, Inc.		1,693		5,587
Exact Sciences Corp. *		1,113		10,395
Exelixis, Inc. *		1,072		5,564
Fluidigm Corp. *		308		5,187
Genomic Health, Inc. *		321		9,746
Halozyme Therapeutics, Inc. *		1,180		7,127
Harvard Bioscience, Inc. *		284		1,454
Hi-Tech Pharmacal Co., Inc.		157		5,190
ICON plc *		41,250		1,324,950
Idenix Pharmaceuticals, Inc. *		816		3,019
ImmunoGen, Inc. *		948		15,187
Immunomedics, Inc. *		1,236		3,164
Impax Laboratories, Inc. *		631		11,042
Infinity Pharmaceuticals, Inc. *		325		14,004
InterMune, Inc. *		846		7,893
Ironwood Pharmaceuticals, Inc. *		1,036		15,758
Isis Pharmaceuticals, Inc. *		1,124		25,166
Jazz Pharmaceuticals plc *		9,342		545,106
Keryx Biopharmaceuticals, Inc. *		750		6,112
Lexicon Pharmaceuticals, Inc. *		596		1,180

See financial notes 19

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Luminex Corp. *		628		10,444
MannKind Corp. *		1,477		5,834
Maxygen, Inc.		1,283		3,079
Momenta Pharmaceuticals, Inc. *		705		8,686
Nektar Therapeutics *		1,261		13,669
Neurocrine Biosciences, Inc. *		976		11,263
NPS Pharmaceuticals, Inc. *		1,057		14,195
Oncothyreon, Inc. *		1,086		2,726
Opko Health, Inc. *		837		5,574
Optimer Pharmaceuticals, Inc. *		740		11,426
Pacira Pharmaceuticals, Inc. *		10,203		294,561
PAREXEL International Corp. *		10,078		412,694
PDL Biopharma, Inc.		1,198		9,272
Pharmacyclics, Inc. *		671		54,686
Pozen, Inc. *		383		1,888
Progenics Pharmaceuticals, Inc. *		448		2,061
Questcor Pharmaceuticals, Inc.		697		21,426
Raptor Pharmaceutical Corp. *		1,137		7,845
Repros Therapeutics, Inc. *		568		11,553
Rigel Pharmaceuticals, Inc. *		997		4,776
Sagent Pharmaceuticals, Inc. *		206		3,407
Salix Pharmaceuticals Ltd. *		4,970		259,881
Sangamo BioSciences, Inc. *		538		5,477
Santarus, Inc. *		834		15,321
Seattle Genetics, Inc. *		1,184		43,749
Sequenom, Inc. *		1,119		4,219
Spectrum Pharmaceuticals, Inc.		952		7,054
Supernus Pharmaceuticals, Inc. *		327		1,681
Synageva BioPharma Corp. *		106		5,479
Synta Pharmaceuticals Corp. *		932		9,553
Targacept, Inc. *		929		4,283
The Medicines Co. *		692		23,362
Theravance, Inc. *		732		24,705
Threshold Pharmaceuticals, Inc. *		1,562		7,529
Transcept Pharmaceuticals, Inc. *		554		2,194
Trius Therapeutics, Inc. *		946		6,594
Vical, Inc. *		1,240		4,576
ViroPharma, Inc. *		980		26,705
VIVUS, Inc. *		1,365		18,141
XOMA Corp. *		1,639		5,736
ZIOPHARM Oncology, Inc. *		1,259		2,115
				6,358,261
Real Estate 4.8%
Acadia Realty Trust		696		19,871
AG Mortgage Investment Trust, Inc.		427		11,046
Agree Realty Corp.		205		6,164
Alexander’s, Inc.		13		4,004
American Assets Trust, Inc.		432		14,584
American Capital Mortgage Investment Corp.		743		19,734
Anworth Mortgage Asset Corp.		1,734		10,942
Apollo Commercial Real Estate Finance, Inc.		505		8,959
Apollo Residential Mortgage, Inc.		306		6,812
Ares Commercial Real Estate Corp.		413		6,951
ARMOUR Residential REIT, Inc.		4,721		30,639
Ashford Hospitality Trust		944		12,159
Associated Estates Realty Corp.		936		16,726
Campus Crest Communities, Inc.		44,715		610,807
CapLease, Inc.		1,754		12,313
Capstead Mortgage Corp.		1,244		16,520
Cedar Realty Trust, Inc.		1,016		6,513
Chesapeake Lodging Trust		622		14,717
Colonial Properties Trust		1,155		26,808
Colony Financial, Inc.		46,162		1,029,413
Coresite Realty Corp.		342		12,374
Cousins Properties, Inc.		947		10,341
CubeSmart		1,562		27,444
CYS Investments, Inc.		2,209		27,458
DCT Industrial Trust, Inc.		2,844		22,268
DiamondRock Hospitality Co.		46,358		462,653
DuPont Fabros Technology, Inc.		889		22,349
Dynex Capital, Inc.		1,211		13,018
EastGroup Properties, Inc.		404		25,480
Education Realty Trust, Inc.		1,165		12,803
EPR Properties		618		34,942
Equity One, Inc.		813		20,723
Excel Trust, Inc.		688		10,478
FelCor Lodging Trust, Inc. *		1,063		6,357
First Industrial Realty Trust, Inc.		1,051		18,855
First Potomac Realty Trust		864		13,824
Forestar Group, Inc. *		464		9,995
Franklin Street Properties Corp.		1,246		19,026
Getty Realty Corp.		550		11,775
Gladstone Commercial Corp.		236		4,517
Glimcher Realty Trust		1,953		24,491
Government Properties Income Trust		544		14,171
Gramercy Property Trust, Inc. *		1,428		6,783
Healthcare Realty Trust, Inc.		1,046		31,401
Hersha Hospitality Trust		1,259		7,529
Highwoods Properties, Inc.		905		37,132
Hudson Pacific Properties, Inc.		611		13,937
Inland Real Estate Corp.		1,250		14,150
Invesco Mortgage Capital, Inc.		1,531		32,763
Investors Real Estate Trust		823		8,008
iStar Financial, Inc. *		1,083		12,649
JAVELIN Mortgage Investment Corp.		342		6,888
Kennedy-Wilson Holdings, Inc.		329		5,471
LaSalle Hotel Properties		65,119		1,688,536
Lexington Realty Trust		1,533		19,638
LTC Properties, Inc.		485		22,552
Mack-Cali Realty Corp.		12,800		355,456
Medical Properties Trust, Inc.		1,588		25,551
Monmouth Real Estate Investment Corp., Class A		752		8,001
National Health Investors, Inc.		250		16,560
New York Mortgage Trust, Inc.		1,436		10,253
NorthStar Realty Finance Corp.		2,445		24,377
Omega Healthcare Investors, Inc.		1,468		48,253
Parkway Properties, Inc.		352		6,417
Pebblebrook Hotel Trust		785		21,321
Pennsylvania Real Estate Investment Trust		932		19,320
PennyMac Mortgage Investment Trust		743		18,761
Potlatch Corp.		420		19,887
PS Business Parks, Inc.		150		11,970
RAIT Financial Trust		1,484		12,673
Ramco-Gershenson Properties Trust		811		14,168
Redwood Trust, Inc.		83,633		1,908,505
Resource Capital Corp.		1,460		9,621
Retail Opportunity Investments Corp.		927		13,729
RLJ Lodging Trust		1,243		28,639

20 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Rouse Properties, Inc.		488		9,248
Ryman Hospitality Properties		415		18,451
Sabra Health Care REIT, Inc.		591		17,624
Saul Centers, Inc.		205		9,184
Select Income REIT		328		9,358
Silver Bay Realty Trust Corp.		182		3,473
Sovran Self Storage, Inc.		415		28,469
Spirit Realty Capital, Inc.		312		6,717
STAG Industrial, Inc.		666		14,679
Starwood Property Trust, Inc.		1,841		50,609
Strategic Hotels & Resorts, Inc. *		1,779		14,357
Summit Hotel Properties, Inc.		72,090		720,179
Sun Communities, Inc.		354		18,107
Sunstone Hotel Investors, Inc. *		1,485		18,429
Tejon Ranch Co. *		159		4,640
Terreno Realty Corp.		299		5,627
The Geo Group, Inc.		898		33,630
Two Harbors Investment Corp.		4,007		48,004
UMH Properties, Inc.		287		3,171
Universal Health Realty Income Trust		106		5,695
Urstadt Biddle Properties, Inc., Class A		224		4,988
Washington Real Estate Investment Trust		714		20,392
Western Asset Mortgage Capital Corp.		505		11,312
Whitestone REIT		404		6,666
				8,274,932
Retailing 5.4%
Aeropostale, Inc. *		1,044		15,305
ANN, Inc. *		741		21,889
Asbury Automotive Group, Inc. *		434		17,399
Ascena Retail Group, Inc. *		49,600		917,600
Barnes & Noble, Inc. *		342		6,200
Bebe Stores, Inc.		766		4,336
Blue Nile, Inc. *		14,602		476,463
Body Central Corp. *		677		6,892
Brown Shoe Co., Inc.		764		12,919
Cabela’s, Inc. *		584		37,493
Chico’s FAS, Inc.		88,332		1,613,826
Conn’s, Inc. *		99		4,288
Core-Mark Holding Co., Inc.		105		5,464
Destination Maternity Corp.		415		9,856
Express, Inc. *		813		14,805
Francesca’s Holdings Corp. *		331		9,453
Fred’s, Inc., Class A		52,010		740,102
Genesco, Inc. *		345		21,235
Group 1 Automotive, Inc.		250		15,120
Hibbett Sports, Inc. *		404		22,159
HomeAway, Inc. *		4,790		146,334
Hot Topic, Inc.		949		13,239
HSN, Inc.		525		27,605
Jos. A. Bank Clothiers, Inc. *		408		17,821
Kayak Software Corp. *		190		7,566
Kirkland’s, Inc. *		479		5,777
Lithia Motors, Inc., Class A		6,523		323,019
Lumber Liquidators Holdings, Inc. *		393		32,210
Monro Muffler Brake, Inc.		36,512		1,510,136
Nutrisystem, Inc.		1,004		8,132
Office Depot, Inc. *		2,606		10,059
OfficeMax, Inc.		1,012		11,648
Penske Automotive Group, Inc.		689		21,304
PetMed Express, Inc.		701		8,763
Pier 1 Imports, Inc.		1,187		27,550
Pool Corp.		614		30,098
Rent-A-Center, Inc.		645		22,530
rue21, Inc. *		288		9,187
Saks, Inc. *		932		10,765
Select Comfort Corp. *		849		18,016
Shutterfly, Inc. *		572		25,471
Sonic Automotive, Inc., Class A		15,702		345,287
Stage Stores, Inc.		26,886		744,473
Stein Mart, Inc.		603		4,770
The Bon-Ton Stores, Inc.		534		8,192
The Buckle, Inc.		280		13,594
The Cato Corp., Class A		36,886		885,633
The Children’s Place Retail Stores, Inc. *		385		18,834
The Finish Line, Inc., Class A		661		12,817
The Men’s Wearhouse, Inc.		598		20,033
The Pep Boys - Manny, Moe & Jack *		705		8,178
Tile Shop Holdings, Inc. *		5,800		143,840
Tilly’s, Inc., Class A *		145		2,094
Tuesday Morning Corp. *		1,091		8,848
Vitacost.com, Inc. *		446		3,470
Vitamin Shoppe, Inc. *		384		18,874
VOXX International Corp. *		800		7,624
Zumiez, Inc. *		26,258		760,694
				9,267,289
Semiconductors & Semiconductor Equipment 1.8%
Advanced Energy Industries, Inc. *		753		12,786
Amkor Technology, Inc. *		1,019		4,310
Applied Micro Circuits Corp. *		734		5,476
ATMI, Inc. *		546		11,875
AXT, Inc. *		1,100		3,157
Brooks Automation, Inc.		992		9,642
Cabot Microelectronics Corp. *		357		11,963
Cavium, Inc. *		37,912		1,192,332
CEVA, Inc. *		11,215		171,141
Cirrus Logic, Inc. *		931		17,978
Cymer, Inc. *		437		45,780
Diodes, Inc. *		365		7,395
Entegris, Inc. *		1,145		10,855
Entropic Communications, Inc. *		936		3,969
First Solar, Inc. *		886		41,252
FormFactor, Inc. *		1,114		5,514
GT Advanced Technologies, Inc. *		983		3,863
Hittite Microwave Corp. *		440		24,688
Inphi Corp. *		620		5,834
Integrated Device Technology, Inc. *		1,097		7,800
International Rectifier Corp. *		572		12,132
Intersil Corp., Class A		1,102		8,552
Kopin Corp. *		1,298		4,296
Lattice Semiconductor Corp. *		1,055		4,906
LTX-Credence Corp. *		1,167		6,885
MEMC Electronic Materials, Inc. *		2,534		13,684
Micrel, Inc.		970		9,758
Microsemi Corp. *		11,920		247,936
Mindspeed Technologies, Inc. *		1,088		2,492
MKS Instruments, Inc.		747		20,072

See financial notes 21

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Monolithic Power Systems, Inc.		591		14,255
Nanometrics, Inc. *		628		8,811
OmniVision Technologies, Inc. *		900		12,069
PDF Solutions, Inc. *		584		9,992
Photronics, Inc. *		1,620		12,782
PLX Technology, Inc. *		904		4,222
Power Integrations, Inc.		23,564		975,785
Rambus, Inc. *		947		6,591
RF Micro Devices, Inc. *		2,375		13,324
Rubicon Technology, Inc. *		163		1,208
Rudolph Technologies, Inc. *		702		8,192
Semtech Corp. *		848		27,195
Sigma Designs, Inc. *		1,220		5,807
Silicon Image, Inc. *		1,158		5,709
Spansion, Inc., Class A *		809		10,509
STR Holdings, Inc. *		612		1,377
Tessera Technologies, Inc.		654		13,322
TriQuint Semiconductor, Inc. *		1,424		8,316
Ultratech, Inc. *		441		12,996
Veeco Instruments, Inc. *		483		18,388
Volterra Semiconductor Corp. *		399		5,191
				3,104,364
Software & Services 6.3%
Accelrys, Inc. *		1,270		12,509
ACI Worldwide, Inc. *		5,472		257,239
Actuate Corp. *		877		5,385
Acxiom Corp. *		852		16,946
Advent Software, Inc. *		537		15,594
Angie’s List, Inc. *		368		8,920
Aspen Technology, Inc. *		16,400		499,872
AVG Technologies NV *		70,100		1,144,032
Bankrate, Inc. *		551		7,427
Blackbaud, Inc.		657		19,257
Blucora, Inc. *		750		11,077
Bottomline Technologies, Inc. *		560		14,672
Brightcove, Inc. *		325		1,957
BroadSoft, Inc. *		474		12,115
CACI International, Inc., Class A *		332		19,419
Callidus Software, Inc. *		789		3,385
Cardtronics, Inc. *		14,522		406,761
CIBER, Inc. *		1,423		6,062
CommVault Systems, Inc. *		19,653		1,445,282
comScore, Inc. *		700		11,319
Comverse, Inc. *		197		5,226
Constant Contact, Inc. *		187		2,732
Convergys Corp.		1,645		27,998
Cornerstone OnDemand, Inc. *		480		17,414
CoStar Group, Inc. *		380		41,196
CSG Systems International, Inc. *		466		10,070
Dealertrack Technologies, Inc. *		627		17,462
Dice Holdings, Inc. *		775		6,541
Digital River, Inc. *		679		9,832
EarthLink, Inc.		768		4,370
Ebix, Inc.		61,223		1,139,360
Ellie Mae, Inc. *		167		4,345
Envestnet, Inc. *		355		6,468
EPAM Systems, Inc. *		14,800		318,200
EPIQ Systems, Inc.		706		9,863
Euronet Worldwide, Inc. *		707		21,585
ExlService Holdings, Inc. *		7,300		238,126
Fair Isaac Corp.		462		21,520
FleetMatics Group plc *		9,140		214,516
Forrester Research, Inc.		22,839		818,778
Global Cash Access Holdings, Inc. *		785		5,597
Global Eagle Entertainment, Inc. *		73,970		711,591
Guidewire Software, Inc. *		192		7,695
Heartland Payment Systems, Inc.		587		19,306
Higher One Holdings, Inc. *		570		5,620
iGATE Corp. *		257		4,289
Infoblox, Inc. *		9,870		218,226
Interactive Intelligence Group, Inc. *		317		13,133
Internap Network Services Corp. *		869		6,935
IntraLinks Holdings, Inc. *		807		4,616
j2 Global, Inc.		626		25,478
Keynote Systems, Inc.		372		4,170
Liquidity Services, Inc. *		238		7,830
LivePerson, Inc. *		533		6,833
LogMeIn, Inc. *		331		7,474
Manhattan Associates, Inc. *		221		15,516
ManTech International Corp., Class A		392		10,462
Market Leader, Inc. *		447		4,479
MAXIMUS, Inc.		8,752		697,447
Mentor Graphics Corp.		1,019		18,607
MicroStrategy, Inc., Class A *		122		11,003
ModusLink Global Solutions, Inc. *		891		2,495
MoneyGram International, Inc. *		348		5,745
Monotype Imaging Holdings, Inc.		481		11,154
Monster Worldwide, Inc. *		941		4,122
Move, Inc. *		1,041		11,878
NetScout Systems, Inc. *		369		8,417
NIC, Inc.		599		10,087
NICE Systems Ltd. *		9,110		323,132
OpenTable, Inc. *		363		20,107
Pegasystems, Inc.		340		8,605
Progress Software Corp. *		788		17,785
Proofpoint, Inc. *		15,660		286,891
PROS Holdings, Inc. *		257		6,661
PTC, Inc. *		1,605		38,536
QLIK Technologies, Inc. *		1,121		29,157
QuinStreet, Inc. *		551		3,604
RealPage, Inc. *		505		10,302
Responsys, Inc. *		889		6,908
Rosetta Stone, Inc. *		529		8,956
Sapient Corp. *		1,309		15,289
SciQuest, Inc. *		370		8,458
SeaChange International, Inc. *		681		7,396
ServiceSource International, Inc. *		362		2,317
Sourcefire, Inc. *		450		21,492
SPS Commerce, Inc. *		72		3,393
SS&C Technologies Holdings, Inc. *		511		15,683
Stamps.com, Inc. *		166		5,617
Sykes Enterprises, Inc. *		329		5,063
Synacor, Inc. *		391		1,138
Synchronoss Technologies, Inc. *		435		12,328
Syntel, Inc.		187		11,813
Take-Two Interactive Software, Inc. *		938		14,314
Tangoe, Inc. *		21,760		279,834
TeleNav, Inc. *		470		2,463
TeleTech Holdings, Inc. *		251		5,344
The Active Network, Inc. *		820		4,125
TiVo, Inc. *		1,233		14,451
Travelzoo, Inc. *		203		5,183

22 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Tyler Technologies, Inc. *		466		29,470
Ultimate Software Group, Inc. *		342		33,034
Unisys Corp. *		643		12,301
United Online, Inc.		776		5,277
ValueClick, Inc. *		1,051		32,434
VASCO Data Security International, Inc. *		391		3,327
Verint Systems, Inc. *		4,547		150,233
Virnetx Holding Corp. *		369		7,535
VistaPrint N.V. *		301		12,281
Vocus, Inc. *		319		2,683
Web.com Group, Inc. *		624		10,858
WebMD Health Corp. *		647		15,625
Websense, Inc. *		26,581		474,205
WEX, Inc. *		524		39,709
XO Group, Inc. *		833		9,380
Yelp, Inc. *		346		9,006
Zillow, Inc., Class A *		126		7,413
Zix Corp. *		1,368		5,144
				10,771,297
Technology Hardware & Equipment 4.1%
3D Systems Corp. *		798		30,516
ADTRAN, Inc.		781		16,401
Aeroflex Holding Corp. *		348		2,589
Anaren, Inc. *		401		9,387
Anixter International, Inc.		400		28,696
ARRIS Group, Inc. *		1,232		20,340
Aruba Networks, Inc. *		67,702		1,522,618
Aviat Networks, Inc. *		1,283		4,106
Avid Technology, Inc. *		773		5,094
Badger Meter, Inc.		136		5,940
Benchmark Electronics, Inc. *		698		12,452
Black Box Corp.		134		2,910
CalAmp Corp. *		25,794		287,087
Calix, Inc. *		848		7,233
Checkpoint Systems, Inc. *		842		9,742
Ciena Corp. *		1,278		19,119
Cognex Corp.		553		21,954
Coherent, Inc.		8,604		481,222
Comtech Telecommunications Corp.		372		9,155
Cray, Inc. *		697		14,749
Daktronics, Inc.		790		7,892
Diebold, Inc.		25,900		758,611
DTS, Inc. *		346		5,806
Electro Rent Corp.		245		4,060
Electro Scientific Industries, Inc.		263		2,835
Electronics for Imaging, Inc. *		400		10,688
Emulex Corp. *		794		4,764
Extreme Networks, Inc. *		1,418		4,722
Fabrinet *		249		3,419
FARO Technologies, Inc. *		117		4,538
FEI Co.		544		34,751
Finisar Corp. *		1,044		13,405
Globecomm Systems, Inc. *		656		8,036
GSI Group, Inc. *		370		3,160
Harmonic, Inc. *		788		4,476
Imation Corp. *		1,184		4,357
Infinera Corp. *		804		6,770
Insight Enterprises, Inc. *		288		5,219
InterDigital, Inc.		644		28,600
Intermec, Inc. *		768		7,557
InvenSense, Inc. *		302		2,815
Ixia *		42,120		693,716
KEMET Corp. *		1,092		6,803
Littelfuse, Inc.		349		24,367
Maxwell Technologies, Inc. *		653		3,983
Measurement Specialties, Inc. *		130		5,560
Mercury Systems, Inc. *		796		6,153
Methode Electronics, Inc.		461		6,629
MTS Systems Corp.		11,424		696,293
Multi-Fineline Electronix, Inc. *		162		2,469
NETGEAR, Inc. *		23,539		701,227
Newport Corp. *		655		9,923
Oclaro, Inc. *		1,205		1,639
OCZ Technology Group, Inc. *		1,106		1,449
Oplink Communications, Inc. *		255		4,187
OSI Systems, Inc. *		237		13,580
Park Electrochemical Corp.		140		3,342
Plantronics, Inc.		614		26,906
Plexus Corp. *		494		13,323
Power-One, Inc. *		894		5,650
Procera Networks, Inc. *		283		3,138
QLogic Corp. *		849		9,220
Quantum Corp. *		1,535		2,195
RealD, Inc. *		770		11,527
Rofin-Sinar Technologies, Inc. *		393		9,786
Rogers Corp. *		112		4,776
Sanmina Corp. *		993		12,532
ScanSource, Inc. *		17,906		518,737
ShoreTel, Inc. *		692		2,498
Silicon Graphics International Corp. *		772		10,036
Sonus Networks, Inc. *		1,630		3,423
STEC, Inc. *		1,607		5,833
Super Micro Computer, Inc. *		549		5,281
Symmetricom, Inc. *		431		2,241
Synaptics, Inc. *		496		20,450
SYNNEX Corp. *		408		14,117
Tellabs, Inc.		2,907		6,018
TTM Technologies, Inc. *		856		6,189
Universal Display Corp. *		598		18,801
ViaSat, Inc. *		510		24,720
Zebra Technologies Corp., Class A *		13,500		629,775
				6,986,283
Telecommunication Services 0.4%
8x8, Inc. *		22,616		163,514
Cincinnati Bell, Inc. *		1,476		5,195
Cogent Communications Group, Inc.		787		22,540
Consolidated Communications Holdings, Inc.		774		14,265
General Communication, Inc., Class A *		408		3,962
IDT Corp., Class B		265		3,919
inContact, Inc. *		52,922		428,668
Iridium Communications, Inc. *		770		5,167
Leap Wireless International, Inc. *		917		5,245
Neutral Tandem, Inc.		360		1,073
NTELOS Holdings Corp.		612		9,008
Premiere Global Services, Inc. *		1,217		13,667
USA Mobility, Inc.		677		9,187
				685,410

See financial notes 23

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Transportation 3.0%
Air Transport Services Group, Inc. *		834		4,812
Alaska Air Group, Inc. *		877		54,058
Allegiant Travel Co.		131		11,777
AMERCO		73		11,731
Arkansas Best Corp.		696		7,315
Atlas Air Worldwide Holdings, Inc. *		15,402		576,035
Avis Budget Group, Inc. *		1,447		41,731
Echo Global Logistics, Inc. *		281		4,875
Forward Air Corp.		462		17,043
Genco Shipping & Trading Ltd. *		897		1,534
Genesee & Wyoming, Inc., Class A *		2,929		249,551
Hawaiian Holdings, Inc. *		1,342		7,368
Heartland Express, Inc.		778		10,557
Hub Group, Inc., Class A *		5,739		210,334
JetBlue Airways Corp. *		2,129		14,669
Kirby Corp. *		7,100		531,719
Knight Transportation, Inc.		763		11,918
Landstar System, Inc.		23,291		1,273,086
Old Dominion Freight Line, Inc. *		981		37,769
Pacer International, Inc. *		762		4,336
Quality Distribution, Inc. *		198		1,576
Republic Airways Holdings, Inc. *		835		9,344
Roadrunner Transportation Systems, Inc. *		377		8,486
Saia, Inc. *		95		3,887
SkyWest, Inc.		318		4,551
Spirit Airlines, Inc. *		270		7,209
Swift Transportation Co. *		1,381		19,362
US Airways Group, Inc. *		83,366		1,408,885
Uti Worldwide, Inc.		33,200		487,708
Werner Enterprises, Inc.		547		12,559
XPO Logistics, Inc. *		521		8,498
				5,054,283
Utilities 2.5%
ALLETE, Inc.		473		24,289
American States Water Co.		334		18,530
Atlantic Power Corp.		1,045		4,911
Atmos Energy Corp.		15,100		669,987
Avista Corp.		816		22,889
Black Hills Corp.		624		29,259
California Water Service Group		778		15,599
CH Energy Group, Inc.		114		7,407
Chesapeake Utilities Corp.		37		1,974
Cleco Corp.		792		39,220
El Paso Electric Co.		612		22,926
IDACORP, Inc.		679		33,414
MGE Energy, Inc.		177		9,885
New Jersey Resources Corp.		5,769		272,297
Northwest Natural Gas Co.		28,466		1,265,883
NorthWestern Corp.		542		23,317
Ormat Technologies, Inc.		443		9,631
Otter Tail Corp.		608		18,970
Piedmont Natural Gas Co., Inc.		906		31,194
PNM Resources, Inc.		1,035		24,850
Portland General Electric Co.		896		28,896
South Jersey Industries, Inc.		425		26,222
Southwest Gas Corp.		635		32,175
The Empire District Electric Co.		692		15,964
The Laclede Group, Inc.		160		7,474
UIL Holdings Corp.		691		28,773
UNS Energy Corp.		11,241		572,841
Westar Energy, Inc.		14,600		510,416
WGL Holdings, Inc.		9,514		439,737
York Water Co.		254		4,763
				4,213,693
Total Common Stock
(Cost $136,961,159)				163,678,200
Other Investment Companies 3.9% of net assets
Equity Fund 0.7%
iShares Russell 2000 Value Index Fund		14,000		1,173,760
Money Market Fund 3.2%
State Street Institutional U.S. Government Money Market Fund		5,409,462		5,409,462
Total Other Investment Companies
(Cost $6,544,288)				6,583,222
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.3% of net assets
U.S. Treasury Obligations 0.3%
U.S. Treasury Bills
0.03%, 06/13/13 (a)(b)		5,000		5,000
0.08%, 06/13/13 (a)(b)		5,000		4,999
0.09%, 06/20/13 (a)(b)		485,000		484,943
Total Short-Term Investments
(Cost $494,942)				494,942
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $145,188,890 and the unrealized appreciation and depreciation were $28,811,811 and ($3,244,337), respectively, with a net unrealized appreciation of $25,567,474.

*	Non-income producing security.
(a)	All or a portion of this security is held as collateral for open futures contracts.
(b)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

24 See financial notes

 Laudus Small-Cap MarketMasters Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
Russell 2000 Index, mini, Long, expires 06/21/13		19		1,795,690		24,513

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$163,678,200		$—		$—		$163,678,200
Other Investment Companies1		6,583,222		—		—		6,583,222
Short-Term Investments1		—		494,942		—		494,942
Total		$170,261,422		$494,942		$—		$170,756,364
Other Financial Instruments
Futures Contract2		$24,513		$—		$—		$24,513

1	As categorized in Portfolio Holdings.
2	Futures contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance				Change in												Balance
	as of		Realized		Unrealized								Gross		Gross		as of
	October 31,		Gains		Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Losses)		(Losses)			Purchases		Sales			in		out		2013
Common Stock		$1,808		$—		($357	)		$—		($1,451	)		$—		$—		$—
Total		$1,808		$—		($357	)		$—		($1,451	)		$—		$—		$—

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 25

 Laudus Small-Cap MarketMasters Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $144,000,389)		$170,756,364
Cash		29
Receivables:
Investments sold		977,964
Fund shares sold		60,767
Dividends		56,836
Due from broker for futures		10,830
Interest		48
Prepaid expenses	+	5,367
Total assets		171,868,205
Liabilities
Payables:
Investments bought		994,155
Investment adviser and administrator fees		13,595
Shareholder service fees		1,861
Fund shares redeemed		12,096
Accrued expenses	+	34,435
Total liabilities		1,056,142
Net Assets
Total assets		171,868,205
Total liabilities	−	1,056,142
Net assets		$170,812,063
Net Assets by Source
Capital received from investors		184,658,582
Net investment loss		(721,300	)
Net realized capital losses		(39,965,318	)
Net unrealized capital gains		26,840,099
Net Asset Value (NAV) by Shares Class

			Shares
Share Class	Net Assets	÷	Outstanding	=	NAV
Investor Shares	$69,226,862		4,623,014			$14.97
Select Shares	$101,585,201		6,683,143			$15.20

26 See financial notes

 Laudus Small-Cap MarketMasters Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $3,448)		$1,192,015
Interest	+	1,153
Total investment income		1,193,168
Expenses
Investment adviser and administrator fees		940,353
Shareholder service fees:
Investor Shares		81,539
Select Shares		83,809
Portfolio accounting fees		38,935
Professional fees		26,252
Transfer agent fees		19,771
Registration fees		14,863
Shareholder reports		14,176
Custodian fees		13,356
Trustees’ fees		3,369
Interest expense		229
Other expenses	+	2,935
Total expenses		1,239,587
Expense reduction by CSIM and its affiliates	−	225,014
Custody credits	−	8
Net expenses	−	1,014,565
Net investment income		178,603
Realized and Unrealized Gains (Losses)
Net realized gains on investments		12,128,573
Net realized gains on futures contracts		251,488
Net realized losses on foreign currency transactions	+	(9	)
Net realized gains		12,380,052
Net unrealized gains on investments		8,322,442
Net unrealized gains on futures contracts	+	229,875
Net unrealized gains	+	8,552,317
Net realized and unrealized gains		20,932,369
Increase in net assets resulting from operations		$21,110,972

See financial notes 27

 Laudus Small-Cap MarketMasters Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13			11/1/11-10/31/12
Net investment income (loss)		$178,603		($1,094,267	)
Net realized gains		12,380,052		17,333,546
Net unrealized gains (losses)	+	8,552,317		(10,805,359	)
Increase in net assets from operations		$21,110,972		$5,433,920

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares Sold
Investor Shares			44,686		$628,557			481,008		$6,525,131
Select Shares	+		474,573		6,836,363			1,179,826		15,072,446
Total shares sold			519,259		$7,464,920			1,660,834		$21,597,577
Shares Redeemed
Investor Shares			(357,791	)	($4,982,661	)		(745,538	)	($9,511,650	)
Select Shares	+		(400,321	)	(5,728,500	)		(12,619,122	)	(146,015,616	)
Total shares redeemed			(758,112	)	($10,711,161	)		(13,364,660	)	($155,527,266	)
Net transactions in fund shares			(238,853	)	($3,246,241	)		(11,703,826	)	($133,929,689	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			11,545,010		$152,947,332			23,248,836		$281,443,101
Total increase or decrease	+		(238,853	)	17,864,731			(11,703,826	)	(128,495,769	)
End of period			11,306,157		$170,812,063			11,545,010		$152,947,332
Net investment loss					($721,300	)				($899,903	)

28 See financial notes

Laudus International MarketMasters Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
Investor Shares	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		19.03			17.45			18.36			15.04			11.78			25.96
Income (loss) from investment operations:
Net investment income (loss)		0.10			0.21			0.16			0.09			0.14			0.20
Net realized and unrealized gains (losses)		3.00			1.52			(0.85	)		3.41			3.63			(12.25	)
Total from investment operations		3.10			1.73			(0.69	)		3.50			3.77			(12.05	)
Less distributions:
Distributions from net investment income		(0.43	)		(0.15	)		(0.22	)		(0.18	)		(0.51	)		(0.10	)
Distributions from net realized gains		—			—			—			—			—			(2.03	)
Total distributions		—			(0.15	)		(0.22	)		(0.18	)		(0.51	)		(2.13	)
Net asset value at end of period		21.70			19.03			17.45			18.36			15.04			11.78
Total return (%)		16.59	1		10.05			(3.87	)		23.47			33.64			(49.97	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.40	2		1.53	3		1.59			1.60			1.62			1.59
Gross operating expenses		1.61	2		1.62			1.60			1.62			1.63			1.59
Net investment income (loss)		0.97	2		1.19			0.80			0.53			0.95			0.95
Portfolio turnover rate		33	1		68			78			83			96			88
Net assets, end of period ($ x 1,000,000)		648			592			665			849			931			918

	11/1/12–			11/1/11–				11/1/10–			11/1/09–			11/1/08–			11/1/07–
Select Shares	4/30/13*			10/31/12				10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		19.03			17.46		��		18.38			15.05			11.80			26.00
Income (loss) from investment operations:
Net investment income (loss)		0.13			0.25				0.19			0.10			0.15			0.23
Net realized and unrealized gains (losses)		2.99			1.50				(0.86	)		3.43			3.64			(12.27	)
Total from investment operations		3.12			1.75				(0.67	)		3.53			3.79			(12.04	)
Less distributions:
Distributions from net investment income		(0.46	)		(0.18	)			(0.25	)		(0.20	)		(0.54	)		(0.13	)
Distributions from net realized gains		—			—				—			—			—			(2.03	)
Total distributions		—			(0.18	)			(0.25	)		(0.20	)		(0.54	)		(2.16	)
Net asset value at end of period		21.69			19.03				17.46			18.38			15.05			11.80
Total return (%)		16.72	1		10.20				(3.76	)		23.68			33.82			(49.91	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses		1.25	2		1.37	3			1.45			1.48	4		1.47			1.48	4
Gross operating expenses		1.45	2		1.47				1.47			1.50			1.58			1.54
Net investment income (loss)		1.18	2		1.40				0.99			0.69			1.08			1.08
Portfolio turnover rate		33	1		68				78			83			96			88
Net assets, end of period ($ x 1,000,000)		1,327			1,062				961			948			630			540

* Unaudited.

¹ Not annualized.

² Annualized.

³ Effective June 6, 2012, the net operating expense limitation was lowered. The ratio presented for period ended 10/31/12 is a blended ratio.

⁴ The ratio of net operating expenses would have been 1.47% if certain non-routine expenses had not been incurred.

See financial notes 29

 Laudus International MarketMasters Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.laudus.com.

				Cost		Value
Holdings by Category				($)		($)
	95	.3%	Common Stock		1,443,383,135		1,883,771,818
	0	.1%	Preferred Stock		803,694		1,027,492
	3	.7%	Other Investment Companies		73,421,813		72,899,443
	0	.0%	Rights		419,648		367,319
	0	.1%	Short-Term Investments		2,170,789		2,170,789
	99	.2%	Total Investments		1,520,199,079		1,960,236,861
	0	.8%	Other Assets and Liabilities, Net				14,955,695
	100	.0%	Net Assets				1,975,192,556

	Number		Value
Security	of Shares		($)
Common Stock 95.3% of net assets
Australia 5.5%
Banks 0.3%
Australia & New Zealand Banking Group Ltd.		41,901		1,384,712
Bendigo & Adelaide Bank Ltd.		6,444		73,958
Commonwealth Bank of Australia		24,782		1,888,905
National Australia Bank Ltd.		35,796		1,263,165
Westpac Banking Corp.		47,466		1,665,109
				6,275,849
Capital Goods 0.5%
Leighton Holdings Ltd.		2,271		47,166
Monadelphous Group Ltd.		467,500		10,158,546
				10,205,712
Commercial & Professional Supplies 0.4%
ALS Ltd.		5,060		51,435
Brambles Ltd.		23,345		211,360
McMillan Shakespeare Ltd.		152,390		2,411,485
Seek Ltd.		65,022		754,385
Transfield Services Ltd.		2,260,626		3,747,100
				7,175,765
Consumer Services 0.3%
Crown Ltd.		6,204		83,015
Echo Entertainment Group Ltd.		12,297		46,151
Flight Centre Ltd.		158,058		6,257,779
TABCORP Holdings Ltd.		10,270		36,762
Tatts Group Ltd.		22,383		75,906
				6,499,613
Diversified Financials 0.0%
ASX Ltd.		2,806		109,405
Macquarie Group Ltd.		4,847		197,184
				306,589
Energy 0.1%
Caltex Australia Ltd.		2,024		45,212
Origin Energy Ltd.		16,850		215,720
Santos Ltd.		14,656		188,257
Whitehaven Coal Ltd.		6,829		13,823
Woodside Petroleum Ltd.		9,980		389,357
WorleyParsons Ltd.		3,314		78,349
				930,718
Food & Staples Retailing 0.1%
Metcash Ltd.		14,377		61,009
Wesfarmers Ltd.		15,554		699,748
Woolworths Ltd.		19,039		719,089
				1,479,846
Food, Beverage & Tobacco 0.0%
Coca-Cola Amatil Ltd.		8,985		141,150
Treasury Wine Estates Ltd.		9,858		59,749
				200,899
Health Care Equipment & Services 0.0%
Cochlear Ltd.		852		58,342
Ramsay Health Care Ltd.		1,970		65,416
Sonic Healthcare Ltd.		5,555		76,345
				200,103
Insurance 0.5%
AMP Ltd.		1,698,535		9,519,651
Insurance Australia Group Ltd.		32,789		197,966
QBE Insurance Group Ltd.		18,204		252,652
Suncorp Group Ltd.		20,038		269,878
				10,240,147
Materials 1.5%
Alumina Ltd. *		36,590		36,590
Amcor Ltd.		598,652		6,148,073
BHP Billiton Ltd.		49,188		1,653,649
BHP Billiton Ltd. ADR		84,325		5,668,326
Boral Ltd.		10,945		56,811
DuluxGroup Ltd.		146,102		711,187
Fortescue Metals Group Ltd.		21,499		78,534
Iluka Resources Ltd.		6,278		58,325
Incitec Pivot Ltd.		26,096		78,302
Newcrest Mining Ltd.		11,930		208,995
Orica Ltd.		542,692		12,869,022
OZ Minerals Ltd.		4,856		21,765
Regis Resources Ltd. *		485,370		1,916,595
Rio Tinto Ltd.		6,611		384,745
Sims Metal Management Ltd.		2,464		24,718
				29,915,637
Media 0.0%
REA Group Ltd.		14,121		455,633
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
CSL Ltd.		56,905		3,718,906
Real Estate 1.1%
CFS Retail Property Trust Group		32,493		74,042
Commonwealth Property Office Fund		11,902,377		14,302,881

30 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Dexus Property Group		72,559		86,798
Federation Centres		22,668		61,100
Goodman Group		25,244		136,551
GPT Group		22,446		95,498
Lend Lease Group		8,133		90,902
Mirvac Group		51,235		94,085
Shopping Centres Australasia Property Group *		2,863,607		4,809,297
Stockland		32,727		131,520
Westfield Group		32,509		393,234
Westfield Retail Trust		45,683		156,204
				20,432,112
Retailing 0.0%
Harvey Norman Holdings Ltd.		7,965		24,797
Super Cheap Auto Group Ltd.		25,506		348,312
				373,109
Software & Services 0.2%
carsales.com Ltd.		401,550		4,028,860
Computershare Ltd.		6,665		68,660
				4,097,520
Telecommunication Services 0.3%
Telstra Corp., Ltd.		1,219,626		6,299,069
Transportation 0.0%
Asciano Ltd.		14,625		81,933
Aurizon Holdings Ltd.		26,915		115,859
Qantas Airways Ltd. *		16,643		32,800
Sydney Airport		1,870		6,709
Toll Holdings Ltd.		10,116		59,846
Transurban Group		20,579		145,582
				442,729
Utilities 0.0%
AGL Energy Ltd.		8,346		137,428
APA Group		12,878		86,968
SP AusNet		24,580		31,988
				256,384
				109,506,340
Austria 0.3%
Banks 0.0%
Erste Group Bank AG *		3,290		103,121
Raiffeisen Bank International AG		733		25,875
				128,996
Capital Goods 0.1%
Andritz AG		44,418		2,892,643
Energy 0.0%
OMV AG		2,275		106,867
Insurance 0.0%
Vienna Insurance Group AG Wiener Versicherung Gruppe		576		30,502
Materials 0.0%
Voestalpine AG		1,648		51,675
Real Estate 0.0%
Immofinanz AG *		13,432		54,922
Semiconductors & Semiconductor Equipment 0.2%
AMS AG		32,026		2,986,292
Telecommunication Services 0.0%
Telekom Austria AG		2,926		20,071
Utilities 0.0%
Verbund AG		1,021		22,352
				6,294,320
Belgium 0.2%
Banks 0.0%
KBC GROEP N.V.		3,694		144,587
Diversified Financials 0.0%
Groupe Bruxelles Lambert S.A.		1,210		93,652
Food & Staples Retailing 0.1%
Colruyt S.A.		29,518		1,490,858
Delhaize Group S.A.		1,527		95,550
				1,586,408
Food, Beverage & Tobacco 0.1%
Anheuser-Busch InBev N.V.		12,382		1,189,545
Insurance 0.0%
Ageas		3,420		125,252
Materials 0.0%
Solvay S.A.		938		137,428
Umicore S.A.		1,709		79,206
				216,634
Media 0.0%
Telenet Group Holding N.V.		838		45,067
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
ThromboGenics N.V. *		9,403		459,296
UCB S.A.		1,687		99,564
				558,860
Telecommunication Services 0.0%
Belgacom S.A.		2,281		52,515
				4,012,520
Brazil 1.1%
Capital Goods 0.2%
Mills Estruturas e Servicos de Engenharia S.A.		248,000		4,071,873
Commercial & Professional Supplies 0.0%
Valid Solucoes e Servicos de Seguranca em Meios de Pagamento e Identificacao S.A.		21,000		393,602
Consumer Services 0.2%
Estacio Participacoes S.A.		184,500		4,398,675
Food & Staples Retailing 0.2%
Brazil Pharma S.A.		505,000		3,230,788
Insurance 0.1%
BB Seguridade Participacoes S.A. *		192,600		1,641,300
Materials 0.2%
Vale S.A. ADR		205,400		3,510,286
Transportation 0.1%
CCR S.A.		180,300		1,782,499

See financial notes 31

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Utilities 0.1%
Cia de Saneamento Basico do Estado de Sao Paulo		97,800		1,376,019
Tractebel Energia S.A.		50,000		890,916
				2,266,935
				21,295,958
Cambodia 0.1%
Consumer Services 0.1%
NagaCorp Ltd.		3,286,000		2,612,555
Canada 3.7%
Capital Goods 0.0%
Finning International, Inc.		13,350		288,083
Diversified Financials 0.1%
CI Financial Corp.		61,622		1,725,502
Energy 0.6%
Canadian Natural Resources Ltd.		68,400		2,006,856
Pason Systems, Inc.		314,100		5,378,158
Suncor Energy, Inc.		105,525		3,287,104
				10,672,118
Food & Staples Retailing 0.1%
Metro, Inc.		31,344		2,125,586
Materials 0.8%
Agrium, Inc.		18,600		1,705,062
Detour Gold Corp. *		116,302		1,399,156
Detour Gold Corp. (b)(c)		21,058		253,336
Norbord, Inc. *		91,510		3,051,999
Potash Corp. of Saskatchewan, Inc.		144,325		6,076,082
West Fraser Timber Co., Ltd.		43,810		3,825,031
				16,310,666
Media 0.5%
Thomson Reuters Corp.		300,300		10,060,177
Real Estate 0.4%
Brookfield Asset Management, Inc., Class A		26,987		1,041,428
Morguard REIT		135,490		2,462,477
Northern Property REIT		118,400		3,794,864
				7,298,769
Retailing 0.1%
Dollarama, Inc.		36,000		2,637,153
Transportation 1.1%
Canadian National Railway Co.		121,312		11,886,150
Canadian Pacific Railway Ltd.		70,075		8,732,746
WestJet Airlines Ltd.		37,806		928,404
				21,547,300
				72,665,354
Chile 0.2%
Diversified Financials 0.0%
Inversiones La Construccion S.A.		19,921		381,898
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
CFR Pharmaceuticals S.A.		2,284,194		589,297
Real Estate 0.1%
Parque Arauco S.A.		517,317		1,337,807
Software & Services 0.0%
Sonda S.A.		164,392		568,940
Telecommunication Services 0.1%
ENTEL Chile S.A.		60,532		1,167,004
				4,044,946
China 1.6%
Automobiles & Components 0.2%
Great Wall Motor Co., Ltd., Class H		570,000		2,476,636
Minth Group Ltd.		712,000		1,276,047
				3,752,683
Banks 0.5%
China Merchants Bank Co., Ltd., Class H		1,747,000		3,731,789
Industrial & Commercial Bank of China Ltd., Class H		8,369,000		5,899,347
				9,631,136
Capital Goods 0.2%
CIMC Enric Holdings Ltd.		1,648,000		1,787,511
Haitian International Holdings Ltd.		1,305,000		2,233,256
				4,020,767
Consumer Durables & Apparel 0.1%
Sunny Optical Technology Group Co., Ltd.		1,489,670		1,976,732
Energy 0.1%
Anton Oilfield Services Group		2,570,000		2,057,190
Health Care Equipment & Services 0.1%
Ginko International Co., Ltd.		183,233		3,401,070
Materials 0.1%
AMVIG Holdings Ltd. (b)		5,574,000		2,155,799
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Sino Biopharmaceutical Ltd.		960,000		662,424
WuXi PharmaTech Cayman, Inc. ADR *		22,248		424,269
				1,086,693
Technology Hardware & Equipment 0.2%
Hollysys Automation Technologies Ltd. *		37,761		454,643
Ju Teng International Holdings Ltd.		4,584,000		2,989,482
				3,444,125
				31,526,195
Cyprus 0.0%
Energy 0.0%
Prosafe SE		19,612		188,603
Denmark 1.3%
Banks 0.0%
Danske Bank A/S *		10,154		192,284
Consumer Durables & Apparel 0.3%
Pandora A/S		240,090		7,346,120

32 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Food, Beverage & Tobacco 0.0%
Carlsberg A/S, Class B		1,681		156,280
Health Care Equipment & Services 0.1%
Coloplast A/S, Class B		1,705		92,763
GN Store Nord A/S		68,231		1,247,897
William Demant Holding A/S *		443		35,471
				1,376,131
Insurance 0.0%
Tryg A/S		368		31,896
Materials 0.6%
Christian Hansen Holding A/S		343,414		12,392,621
Novozymes A/S, B Shares		3,747		129,688
				12,522,309
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Novo Nordisk A/S, Class B		6,280		1,105,435
Software & Services 0.2%
SimCorp A/S		11,925		3,485,853
Telecommunication Services 0.0%
TDC A/S		10,598		86,003
Transportation 0.0%
AP Moller - Maersk A/S, Series A		9		61,601
AP Moller - Maersk A/S, Series B		20		142,420
DSV A/S		3,059		77,052
				281,073
				26,583,384
Finland 0.2%
Automobiles & Components 0.0%
Nokian Renkaat Oyj		1,651		71,719
Capital Goods 0.2%
Kone Oyj, Class B		25,153		2,223,236
Metso Oyj		1,916		78,944
Wartsila Oyj Abp		2,658		130,703
				2,432,883
Diversified Financials 0.0%
Pohjola Bank plc, A Shares		2,071		35,255
Energy 0.0%
Neste Oil Oyj		1,922		30,014
Food & Staples Retailing 0.0%
Kesko Oyj, B Shares		1,003		30,115
Insurance 0.0%
Sampo Oyj, A Shares		6,533		261,417
Materials 0.0%
Stora Enso Oyj, R Shares		8,723		60,834
UPM-Kymmene Oyj		8,330		87,696
				148,530
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Orion Oyj, Class B		1,428		41,038
Technology Hardware & Equipment 0.0%
Nokia Oyj		57,419		192,910
Telecommunication Services 0.0%
Elisa Oyj		2,120		40,212
Utilities 0.0%
Fortum Oyj		6,918		128,588
				3,412,681
France 6.9%
Automobiles & Components 0.0%
Compagnie Generale des Etablissements Michelin		2,745		232,123
Peugeot S.A. *		3,449		27,611
Renault S.A.		2,997		206,837
				466,571
Banks 1.0%
BNP Paribas S.A.		356,203		19,861,130
Credit Agricole S.A. *		14,879		136,302
Natixis		13,865		60,777
Societe Generale S.A. *		10,648		386,809
				20,445,018
Capital Goods 0.6%
Alstom S.A.		3,268		134,211
Bouygues S.A.		2,833		79,162
Compagnie de Saint-Gobain		39,807		1,594,228
Legrand S.A.		3,543		165,347
Mersen		92,004		2,128,503
Nexans S.A.		105,531		4,849,167
Rexel S.A.		2,466		54,313
Safran S.A.		3,491		171,603
Schneider Electric S.A.		8,134		620,109
Thales S.A.		1,517		65,916
Vallourec S.A.		1,597		76,648
Vinci S.A.		6,963		335,664
Zodiac Aerospace		5,358		672,209
				10,947,080
Commercial & Professional Supplies 0.2%
Bureau Veritas S.A.		894		109,543
Edenred		2,754		91,745
Societe BIC S.A.		8,528		909,433
Teleperformance		49,300		2,168,138
				3,278,859
Consumer Durables & Apparel 0.5%
Christian Dior S.A.		40,571		7,081,254
Hermes International		4,233		1,429,434
LVMH Moet Hennessy Louis Vuitton S.A.		3,864		669,572
				9,180,260
Consumer Services 0.0%
Accor S.A.		2,211		73,210
Sodexo		1,491		124,510
				197,720
Diversified Financials 0.0%
Eurazeo		496		26,318
Wendel S.A.		493		53,433
				79,751
Energy 0.1%
Compagnie Generale de Geophysique - Veritas *		2,590		56,029
Technip S.A.		1,522		163,250

See financial notes 33

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Total S.A.		32,800		1,651,055
				1,870,334
Food & Staples Retailing 0.0%
Carrefour S.A.		9,083		269,757
Casino Guichard Perrachon S.A.		918		99,295
			��
				369,052
Food, Beverage & Tobacco 0.5%
Danone S.A.		112,947		8,614,262
Pernod-Ricard S.A.		3,214		398,119
Remy Cointreau S.A.		330		38,415
				9,050,796
Health Care Equipment & Services 0.2%
Essilor International S.A.		3,059		344,665
Medica S.A.		186,943		3,461,497
				3,806,162
Household & Personal Products 0.0%
L’Oreal S.A.		3,759		670,947
Insurance 0.2%
AXA S.A.		26,826		502,361
CNP Assurances		2,227		31,564
Euler Hermes S.A.		24,338		2,327,251
SCOR SE		2,591		78,636
				2,939,812
Materials 0.1%
Air Liquide S.A.		4,740		600,540
Arkema S.A.		22,131		2,074,733
Imerys S.A.		509		33,513
Lafarge S.A.		2,886		186,831
				2,895,617
Media 0.7%
Eutelsat Communications S.A.		1,976		71,399
Ipsos		109,533		3,671,151
JC Decaux S.A.		997		27,430
Lagardere S.C.A.		1,770		65,787
Publicis Groupe S.A.		147,468		10,254,674
				14,090,441
Pharmaceuticals, Biotechnology & Life Sciences 0.6%
Boiron S.A.		74,612		4,228,141
Eurofins Scientific *		25,880		5,625,098
Sanofi		18,342		1,983,055
				11,836,294
Real Estate 0.3%
Fonciere des Regions		412		32,873
Gecina S.A.		329		39,645
ICADE		350		32,354
Klepierre		1,564		66,369
Unibail-Rodamco SE		21,034		5,498,596
				5,669,837
Retailing 0.5%
PPR		44,082		9,709,982
Semiconductors & Semiconductor Equipment 0.0%
STMicroelectronics N.V.		9,557		83,155
Software & Services 0.2%
Altran Technologies S.A. *		426,230		3,355,494
AtoS		901		62,767
Cap Gemini S.A.		2,219		102,310
Dassault Systemes S.A.		981		119,758
				3,640,329
Technology Hardware & Equipment 0.8%
Gemalto N.V.		1,173		95,884
Ingenico		109,974		7,387,964
Neopost S.A.		122,744		8,091,025
				15,574,873
Telecommunication Services 0.0%
France Telecom S.A.		28,027		299,311
Iliad S.A.		348		79,560
Vivendi S.A.		20,511		464,613
				843,484
Transportation 0.0%
Aeroports de Paris		519		46,975
Groupe Eurotunnel S.A. - Reg’d		8,871		74,324
				121,299
Utilities 0.4%
EDF S.A.		3,627		81,201
GDF Suez		20,159		432,215
Rubis		119,942		7,713,332
Suez Environnement Co.		4,195		60,203
Veolia Environnement S.A.		5,454		75,442
				8,362,393
				136,130,066
Germany 7.4%
Automobiles & Components 1.5%
Bayerische Motoren Werke AG		71,894		6,648,045
Continental AG		1,701		202,330
Daimler AG - Reg’d		348,312		19,312,176
ElringKlinger AG		121,753		3,981,731
Volkswagen AG		442		86,119
				30,230,401
Banks 0.1%
Aareal Bank AG *		102,510		2,470,570
Commerzbank AG *		5,628		75,963
				2,546,533
Capital Goods 1.4%
Brenntag AG		11,117		1,898,352
Duerr AG		26,800		3,054,802
GEA Group AG		2,817		95,456
Hochtief AG *		480		33,397
KUKA AG *		43,086		1,950,690
MAN SE		665		74,610
MTU Aero Engines Holding AG		95,157		9,013,887
NORMA Group		185,368		6,547,620
Rational AG		11,284		3,503,075
Siemens AG - Reg’d		12,897		1,347,569
				27,519,458
Commercial & Professional Supplies 0.3%
Bertrandt AG		4,239		488,376
Bilfinger SE		56,212		5,641,951
				6,130,327
Consumer Durables & Apparel 0.1%
Adidas AG		3,242		339,007
Gerry Weber International AG		18,834		827,239

34 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Hugo Boss AG		414		48,252
				1,214,498
Diversified Financials 0.1%
Deutsche Bank AG - Reg’d		14,133		650,585
Deutsche Boerse AG		3,030		189,363
				839,948
Food & Staples Retailing 0.0%
Metro AG		1,944		60,717
Food, Beverage & Tobacco 0.0%
Suedzucker AG		1,360		54,866
Health Care Equipment & Services 0.0%
Celesio AG		1,275		25,246
Fresenius Medical Care AG & Co KGaA		3,256		224,325
Fresenius SE & Co KGaA		1,919		240,744
				490,315
Household & Personal Products 0.0%
Beiersdorf AG		1,597		144,660
Henkel AG & Co. KGaA		2,052		160,843
				305,503
Insurance 0.8%
Allianz SE - Reg’d		104,034		15,388,763
Hannover Rueckversicherung AG - Reg’d		904		76,484
Muenchener Rueckversicherungs-Gesellschaft AG - Reg’d		2,722		545,234
				16,010,481
Materials 1.3%
BASF SE		14,156		1,325,179
BASF SE ADR		46,050		4,296,465
HeidelbergCement AG		2,226		160,691
K&S AG - Reg’d		2,720		120,416
Lanxess AG		1,318		96,255
Linde AG		2,864		542,280
Salzgitter AG		586		23,066
Symrise AG		434,719		18,581,534
ThyssenKrupp AG *		6,015		109,044
				25,254,930
Media 0.2%
Axel Springer AG		593		25,024
GfK SE (b)		74,581		4,255,850
Kabel Deutschland Holding AG		1,308		124,168
				4,405,042
Pharmaceuticals, Biotechnology & Life Sciences 0.5%
Bayer AG - Reg’d		61,960		6,477,698
Merck KGaA		1,024		156,003
QIAGEN N.V. *		169,552		3,360,903
				9,994,604
Real Estate 0.2%
Deutsche Wohnen AG		84,469		1,489,664
TAG Immobilien AG		260,050		3,150,751
				4,640,415
Retailing 0.3%
Fielmann AG		60,527		5,841,203
Semiconductors & Semiconductor Equipment 0.0%
Infineon Technologies AG		16,932		133,934
Software & Services 0.4%
SAP AG		33,805		2,695,000
United Internet AG - Reg’d		1,612		44,261
Wirecard AG		198,870		5,345,863
				8,085,124
Technology Hardware & Equipment 0.1%
Wincor Nixdorf AG		15,868		836,958
Telecommunication Services 0.0%
Deutsche Telekom AG - Reg’d		42,630		504,916
Transportation 0.0%
Deutsche Lufthansa AG - Reg’d		3,433		68,737
Deutsche Post AG - Reg’d		14,072		334,505
Fraport AG Frankfurt Airport Services Worldwide		551		32,967
				436,209
Utilities 0.1%
E.ON SE AG		27,338		496,473
RWE AG		7,394		266,474
				762,947
				146,299,329
Greece 0.0%
Consumer Services 0.0%
OPAP S.A.		3,348		33,003
Telecommunication Services 0.0%
Hellenic Telecommunications Organization S.A. (OTE) *		3,767		32,742
				65,745
Hong Kong 2.7%
Banks 0.2%
Bank of East Asia Ltd.		17,800		73,340
BOC Hong Kong (Holdings) Ltd.		58,000		199,879
Dah Sing Banking Group Ltd.		1,762,400		2,597,099
Hang Seng Bank Ltd.		12,000		201,005
				3,071,323
Capital Goods 0.0%
Hopewell Holdings Ltd.		8,500		32,901
Hutchison Whampoa Ltd.		33,000		359,014
Noble Group Ltd.		58,000		53,203
NWS Holdings Ltd.		20,000		35,759
				480,877
Consumer Durables & Apparel 0.5%
Haier Electronics Group Co., Ltd. *		210,000		375,465
Man Wah Holdings Ltd.		2,529,200		2,463,540
Techtronic Industries Co., Ltd.		3,098,500		7,425,287
Yue Yuen Industrial Holdings Ltd.		11,000		38,122
				10,302,414
Consumer Services 0.0%
Galaxy Entertainment Group Ltd. *		32,000		143,661
MGM China Holdings Ltd.		14,000		33,048
Sands China Ltd.		38,000		199,803
Shangri-La Asia Ltd.		26,000		50,372
SJM Holdings Ltd.		29,683		74,938

See financial notes 35

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Wynn Macau Ltd. *		23,200		70,562
				572,384
Diversified Financials 0.0%
First Pacific Co., Ltd.		32,000		44,319
Hong Kong Exchanges & Clearing Ltd.		16,500		278,282
Value Partners Group Ltd.		663,000		407,025
				729,626
Energy 0.2%
Kunlun Energy Co., Ltd.		1,760,000		3,449,196
Food, Beverage & Tobacco 0.0%
Biostime International Holdings Ltd.		19,000		109,634
Insurance 0.1%
AIA Group Ltd.		186,000		827,413
Real Estate 0.7%
Cheung Kong (Holdings) Ltd.		21,410		323,114
China Overseas Grand Oceans Group Ltd.		2,398,250		3,780,446
China Overseas Land & Investment Ltd.		1,202,000		3,670,020
Hang Lung Properties Ltd.		35,000		136,279
Henderson Land Development Co., Ltd.		15,000		108,848
Hysan Development Co., Ltd.		10,000		49,663
Kerry Properties Ltd.		11,000		49,911
New World Development Co., Ltd.		54,000		94,397
Sino Land Co., Ltd.		44,000		72,509
Sun Hung Kai Properties Ltd.		24,000		347,042
Swire Pacific Ltd., Class A		10,500		133,614
Swire Properties Ltd.		17,800		63,641
The Link REIT		35,500		201,242
Wharf Holdings Ltd.		420,349		3,754,598
Wheelock & Co., Ltd.		14,000		78,015
				12,863,339
Retailing 0.3%
Emperor Watch & Jewellery Ltd.		48,603,941		4,960,895
Li & Fung Ltd.		90,000		116,807
Sa Sa International Holdings Ltd.		1,016,000		1,059,329
				6,137,031
Semiconductors & Semiconductor Equipment 0.1%
ASM Pacific Technology Ltd.		240,900		2,487,513
Technology Hardware & Equipment 0.3%
AAC Technologies Holdings, Inc.		1,152,500		5,641,333
China High Precision Automation Group Ltd. (a)(b)		766,000		12,240
				5,653,573
Telecommunication Services 0.1%
HKT Trust & HKT Ltd.		34,000		35,722
Hutchison Telecommunications Hong Kong Holdings Ltd.		2,322,000		1,239,667
PCCW Ltd.		60,000		30,572
SmarTone Telecommunications Holdings Ltd.		648,500		1,156,875
				2,462,836
Transportation 0.2%
Cathay Pacific Airways Ltd.		18,000		31,727
MTR Corp., Ltd.		23,500		97,004
Orient Overseas International Ltd.		3,500		20,833
Pacific Basin Shipping Ltd.		5,661,000		3,238,341
				3,387,905
Utilities 0.0%
Cheung Kong Infrastructure Holdings Ltd.		7,400		53,740
CLP Holdings Ltd.		26,500		233,741
Hong Kong & China Gas Co., Ltd.		81,400		245,187
Power Assets Holdings Ltd.		21,000		205,355
				738,023
				53,273,087
India 1.0%
Banks 0.1%
Gruh Finance Ltd.		81,591		288,459
IndusInd Bank Ltd.		99,537		864,682
Yes Bank Ltd.		98,736		920,672
				2,073,813
Diversified Financials 0.1%
Mahindra & Mahindra Financial Services Ltd.		520,282		2,205,902
Food, Beverage & Tobacco 0.1%
McLeod Russel India Ltd.		372,260		2,166,299
Health Care Equipment & Services 0.1%
Apollo Hospitals Enterprise Ltd.		105,900		1,639,755
Pharmaceuticals, Biotechnology & Life Sciences 0.4%
Glenmark Pharmaceuticals Ltd.		149,790		1,355,415
Ipca Laboratories Ltd.		56,559		533,623
Lupin Ltd.		73,748		963,175
Wockhardt Ltd. *		100,700		3,563,238
				6,415,451
Real Estate 0.0%
Oberoi Realty Ltd.		82,032		371,709
Software & Services 0.2%
HCL Technologies Ltd.		79,973		1,069,887
Tata Consultancy Services Ltd.		119,584		3,060,783
				4,130,670
				19,003,599
Indonesia 0.6%
Banks 0.1%
PT Bank Rakyat Indonesia (Persero) Tbk		2,404,500		2,328,817
Real Estate 0.2%
PT Alam Sutera Realty Tbk		8,733,000		944,822
PT Ciputra Development Tbk		2,867,000		406,523
PT Pakuwon Jati Tbk		47,093,000		1,963,010
				3,314,355
Technology Hardware & Equipment 0.1%
PT Erajaya Swasembada Tbk *		5,630,000		1,811,537
Telecommunication Services 0.2%
PT Telekomunikasi Indonesia (Persero) Tbk		2,811,500		3,387,247
				10,841,956

36 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Ireland 1.2%
Banks 0.1%
Bank of Ireland *		8,358,400		1,862,178
Capital Goods 0.3%
Eaton Corp. plc		54,700		3,359,127
Ingersoll-Rand plc		43,200		2,324,160
				5,683,287
Commercial & Professional Supplies 0.3%
Experian plc		388,479		6,835,177
Energy 0.1%
Dragon Oil plc		119,023		1,172,706
Food, Beverage & Tobacco 0.3%
Glanbia plc		396,956		5,313,897
Kerry Group plc, Class A		2,289		135,381
				5,449,278
Materials 0.1%
CRH plc		11,148		240,057
Smurfit Kappa Group plc		155,350		2,309,733
				2,549,790
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Elan Corp. plc *		7,936		91,860
Shire plc		8,489		264,619
				356,479
Transportation 0.0%
Ryanair Holdings plc ADR		12,435		538,933
				24,447,828
Israel 0.5%
Banks 0.0%
Bank Hapoalim B.M. *		15,869		73,819
Bank Leumi Le-Israel B.M. *		18,157		64,537
Mizrahi Tefahot Bank Ltd. *		1,853		18,957
				157,313
Energy 0.0%
Delek Group Ltd.		68		17,928
Materials 0.0%
Israel Chemicals Ltd.		6,666		79,436
The Israel Corp., Ltd. *		35		22,538
				101,974
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Teva Pharmaceutical Industries Ltd.		13,696		525,838
Semiconductors & Semiconductor Equipment 0.0%
Mellanox Technologies Ltd. *		612		32,061
Software & Services 0.5%
Check Point Software Technologies Ltd. *		196,100		9,142,182
NICE Systems Ltd. *		898		31,853
				9,174,035
Telecommunication Services 0.0%
Bezeq Israeli Telecommunication Corp., Ltd.		26,399		38,345
				10,047,494
Italy 2.4%
Automobiles & Components 0.0%
Fiat S.p.A. *		13,397		80,281
Pirelli & C. S.p.A.		3,567		37,100
				117,381
Banks 0.9%
Banca Monte dei Paschi di Siena S.p.A. *		73,168		20,648
Banco Popolare Scarl *		26,443		38,198
Intesa Sanpaolo S.p.A.		9,458,627		17,177,972
Intesa Sanpaolo S.p.A. - RSP		13,982		21,942
UniCredit S.p.A. *		61,264		320,205
Unione di Banche Italiane S.C.P.A.		12,391		51,822
				17,630,787
Capital Goods 0.7%
Fiat Industrial S.p.A.		1,107,633		12,507,715
Finmeccanica S.p.A. *		6,068		31,609
Prysmian S.p.A.		3,054		61,644
				12,600,968
Consumer Durables & Apparel 0.2%
Luxottica Group S.p.A.		2,543		131,713
Salvatore Ferragamo Italia S.p.A.		93,940		2,806,959
Tod’s S.p.A.		9,619		1,397,537
				4,336,209
Diversified Financials 0.5%
Azimut Holding S.p.A.		65,239		1,214,173
Banca Generali S.p.A.		408,530		8,431,307
Exor S.p.A.		961		29,119
Mediobanca S.p.A.		7,747		49,307
				9,723,906
Energy 0.1%
Eni S.p.A.		39,252		936,804
Saipem S.p.A.		4,111		116,655
Tenaris S.A.		7,371		164,332
				1,217,791
Insurance 0.0%
Assicurazioni Generali S.p.A.		17,664		324,413
Telecommunication Services 0.0%
Telecom Italia S.p.A.		146,192		124,175
Telecom Italia S.p.A. - RSP		90,360		62,757
				186,932
Transportation 0.0%
Atlantia S.p.A.		4,962		88,713
Utilities 0.0%
Enel Green Power S.p.A.		26,240		55,976
Enel S.p.A.		99,769		385,844
Snam S.p.A.		25,096		123,501
Terna - Rete Elettrica Nationale S.p.A.		21,282		99,613
				664,934
				46,892,034
Japan 15.7%
Automobiles & Components 3.1%
Aisin Seiki Co., Ltd.		2,900		104,681

See financial notes 37

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Bridgestone Corp.		10,100		381,208
Daihatsu Motor Co., Ltd.		3,000		59,510
Denso Corp.		114,600		5,138,738
F.C.C. Co., Ltd.		413,700		10,487,828
Fuji Heavy Industries Ltd.		368,000		6,946,174
Honda Motor Co., Ltd.		377,607		15,067,449
Isuzu Motors Ltd.		18,317		122,071
Koito Manufacturing Co., Ltd.		2,000		38,691
Mazda Motor Corp. *		44,000		150,763
Mitsubishi Motors Corp. *		58,000		68,514
Musashi Seimitsu Industry Co., Ltd.		74,200		1,792,564
NGK Spark Plug Co., Ltd.		3,000		50,576
NHK Spring Co., Ltd.		2,200		23,814
Nifco, Inc.		302,300		6,902,175
Nissan Motors Co., Ltd.		37,600		392,254
NOK Corp.		1,600		23,073
Stanley Electric Co., Ltd.		2,200		42,195
Sumitomo Rubber Industries Ltd.		2,600		48,009
Suzuki Motor Corp.		5,400		138,759
Toyoda Gosei Co., Ltd.		1,000		25,953
Toyota Boshoku Corp.		1,000		14,374
Toyota Industries Corp.		2,514		102,943
Toyota Motor Corp.		232,577		13,498,262
TS Tech Co., Ltd.		12,400		376,554
Yamaha Motor Co., Ltd.		4,200		58,592
				62,055,724
Banks 0.9%
Aozora Bank Ltd.		16,000		50,129
Fukuoka Financial Group, Inc.		12,000		61,389
Mitsubishi UFJ Financial Group, Inc.		196,400		1,332,542
Mizuho Financial Group, Inc.		352,900		776,541
Resona Holdings, Inc.		29,500		157,463
Seven Bank Ltd.		873,400		3,101,378
Shinsei Bank Ltd.		21,000		58,941
Sumitomo Mitsui Financial Group, Inc.		210,600		9,954,498
Sumitomo Mitsui Trust Holdings, Inc.		49,000		246,250
Suruga Bank Ltd.		105,000		1,857,672
The Bank of Kyoto Ltd.		5,000		52,606
The Bank of Yokohama Ltd.		19,000		115,591
The Chiba Bank Ltd.		12,000		93,176
The Chugoku Bank Ltd.		3,000		52,308
The Gunma Bank Ltd.		6,000		38,171
The Hachijuni Bank Ltd.		7,000		47,659
The Hiroshima Bank Ltd.		8,000		42,173
The Iyo Bank Ltd.		4,000		41,894
The Joyo Bank Ltd.		10,000		61,470
The Nishi-Nippon City Bank Ltd.		10,000		33,360
The Shizuoka Bank Ltd.		8,454		103,480
Yamaguchi Financial Group, Inc.		3,274		35,555
				18,314,246
Capital Goods 2.1%
Aica Kogyo Co., Ltd.		164,200		3,307,494
Aida Engineering Ltd.		339,300		2,807,017
Amada Co., Ltd.		6,000		48,146
Asahi Glass Co., Ltd.		16,000		125,715
Chiyoda Corp.		2,417		24,849
Daifuku Co., Ltd.		267,000		2,362,918
Daikin Industries Ltd.		41,400		1,662,508
Fanuc Corp.		13,851		2,090,838
Fuji Electric Co., Ltd.		8,000		27,373
Furukawa Electric Co., Ltd.		10,000		25,306
GS Yuasa Corp.		5,000		21,197
Hino Motors Ltd.		4,000		61,099
Hitachi Construction Machinery Co., Ltd.		1,600		38,062
IHI Corp.		20,000		74,579
Itochu Corp.		288,100		3,572,279
JGC Corp.		3,000		88,894
JTEKT Corp.		3,300		33,648
Kajima Corp.		13,000		41,510
Kawasaki Heavy Industries Ltd.		23,000		73,345
Kinden Corp.		2,000		14,591
Komatsu Ltd.		14,100		386,311
Kubota Corp.		17,000		244,183
Kurita Water Industries Ltd.		1,700		34,899
LIXIL Group Corp.		4,000		89,925
Mabuchi Motor Co., Ltd.		400		21,719
Makita Corp.		55,400		3,379,290
Marubeni Corp.		25,445		182,650
Misumi Group, Inc.		131,600		4,018,113
Mitsubishi Corp.		21,349		384,330
Mitsubishi Electric Corp.		30,000		286,002
Mitsubishi Heavy Industries Ltd.		46,000		317,218
Mitsui & Co., Ltd.		26,300		362,326
Miura Co., Ltd.		73,700		1,735,027
Monotaro Co., Ltd.		124,228		3,165,557
Nabtesco Corp.		1,400		30,894
NGK Insulators Ltd.		4,000		48,349
Nidec Corp.		1,700		115,610
NSK Ltd.		7,000		56,627
Obayashi Corp.		10,000		61,527
Sanwa Holdings Corp.		566,000		3,434,807
Shimizu Corp.		9,000		36,223
SMC Corp.		837		167,796
Sojitz Corp.		18,800		29,518
Sumitomo Corp.		17,400		217,831
Sumitomo Electric Industries Ltd.		11,800		156,924
Sumitomo Heavy Industries Ltd.		9,000		40,075
Tadano Ltd.		255,000		3,192,010
Taisei Corp.		15,000		50,101
The Japan Steel Works Ltd.		5,000		25,402
THK Co., Ltd.		1,800		37,910
Toshiba Plant Systems & Services Corp.		134,000		1,814,387
TOTO Ltd.		4,313		44,732
Toyota Tsusho Corp.		3,200		89,125
Ushio, Inc.		1,600		16,303
				40,775,069
Commercial & Professional Supplies 0.4%
Dai Nippon Printing Co., Ltd.		9,000		88,125
Meitec Corp.		92,300		2,378,565
Park24 Co., Ltd.		34,900		704,211
Secom Co., Ltd.		73,100		4,077,091
Toppan Printing Co., Ltd.		9,000		68,575
				7,316,567
Consumer Durables & Apparel 0.1%
Asics Corp.		2,200		39,716
Casio Computer Co., Ltd.		3,600		29,827

38 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Namco Bandai Holdings, Inc.		2,900		52,857
Nikon Corp.		5,300		115,360
Panasonic Corp. *		33,900		244,313
Rinnai Corp.		500		39,758
Sankyo Co., Ltd.		800		36,462
Sega Sammy Holdings, Inc.		3,200		84,075
Sekisui Chemical Co., Ltd.		7,000		88,148
Sekisui House Ltd.		8,355		125,236
Sharp Corp. *		15,419		53,536
Shimano, Inc.		1,145		99,735
Sony Corp.		15,500		254,789
Yamaha Corp.		2,400		25,736
				1,289,548
Consumer Services 0.0%
Benesse Holdings, Inc.		1,000		44,320
McDonald’s Holdings Co., Ltd.		1,000		29,164
Oriental Land Co., Ltd.		800		129,336
				202,820
Diversified Financials 1.2%
Acom Co., Ltd. *		610		24,994
AEON Financial Service Co., Ltd.		120,000		3,597,719
Credit Saison Co., Ltd.		2,600		76,054
Daiwa Securities Group, Inc.		1,415,000		12,554,801
Japan Exchange Group, Inc.		800		98,200
Mitsubishi UFJ Lease & Finance Co., Ltd.		8,700		49,143
Nomura Holdings, Inc.		56,200		459,306
ORIX Corp.		419,300		6,433,868
SBI Holdings, Inc.		3,336		64,622
				23,358,707
Energy 0.0%
Cosmo Oil Co., Ltd. *		9,000		21,495
Idemitsu Kosan Co., Ltd.		340		28,764
Inpex Corp.		34		164,537
Japan Petroleum Exploration Co.		400		15,883
JX Holdings, Inc.		34,900		189,502
Showa Shell Sekiyu K.K.		2,800		22,473
TonenGeneral Sekiyu K.K.		4,367		44,130
				486,784
Food & Staples Retailing 0.4%
Aeon Co., Ltd.		9,500		134,495
Ain Pharmaciez, Inc.		5,900		288,388
FamilyMart Co., Ltd.		29,100		1,329,885
Lawson, Inc.		29,729		2,340,688
Seven & I Holdings Co., Ltd.		11,700		450,054
Sundrug Co., Ltd.		80,100		3,522,683
Tsuruha Holdings, Inc.		7,000		682,122
				8,748,315
Food, Beverage & Tobacco 0.7%
Ajinomoto Co., Inc.		10,000		137,244
Ariake Japan Co., Ltd.		131,000		3,010,261
Asahi Group Holdings Ltd.		6,100		151,692
Calbee, Inc.		30,900		3,054,988
Coca-Cola West Co., Ltd.		900		16,739
Japan Tobacco, Inc.		171,300		6,475,348
Kikkoman Corp.		3,000		56,943
Kirin Holdings Co., Ltd.		13,000		227,487
Meiji Holdings Co., Ltd.		1,000		45,144
Nippon Meat Packers, Inc.		3,000		46,071
Nisshin Seifun Group, Inc.		3,000		38,761
Nissin Food Holdings Co., Ltd.		900		40,369
Toyo Suisan Kaisha Ltd.		1,000		33,985
Yakult Honsha Co., Ltd.		1,500		65,383
Yamazaki Baking Co., Ltd.		2,000		26,173
				13,426,588
Health Care Equipment & Services 1.5%
Alfresa Holdings Corp.		600		35,696
Hogy Medical Co., Ltd.		97,200		5,982,746
M3, Inc.		1,350		3,053,450
Medipal Holdings Corp.		2,200		34,518
Miraca Holdings, Inc.		127,500		6,358,022
Nihon Kohden Corp.		69,200		2,657,338
Olympus Corp. *		290,100		7,283,764
Ship Healthcare Holdings, Inc.		88,700		3,414,186
Suzuken Co., Ltd.		1,100		42,834
Sysmex Corp.		1,100		70,939
Terumo Corp.		2,400		119,233
				29,052,726
Household & Personal Products 0.2%
Kao Corp.		8,200		283,540
Pigeon Corp.		40,800		3,509,991
Shiseido Co., Ltd.		5,400		77,325
Unicharm Corp.		1,800		116,390
				3,987,246
Insurance 0.1%
MS&AD Insurance Group Holdings, Inc.		7,810		209,548
NKSJ Holdings, Inc.		5,900		149,749
Sony Financial Holdings, Inc.		2,600		36,730
T&D Holdings, Inc.		8,700		101,340
The Dai-ichi Life Insurance Co., Ltd.		131		180,579
Tokio Marine Holdings, Inc.		10,500		333,686
				1,011,632
Materials 0.6%
Nippon Steel & Sumitomo Metal Corp.		115,000		306,299
Air Water, Inc.		2,278		36,886
Asahi Kasei Corp.		19,463		130,837
Daicel Corp.		5,000		40,354
Daido Steel Co., Ltd.		4,373		23,834
Denki Kagaku Kogyo K.K.		7,000		25,609
Hitachi Chemical Co., Ltd.		1,600		25,083
Hitachi Metals Ltd.		3,000		31,016
JFE Holdings, Inc.		7,300		158,497
JSR Corp.		2,700		62,154
Kaneka Corp.		4,337		26,127
Kansai Paint Co., Ltd.		223,373		2,866,290
Kobe Steel Ltd. *		37,000		48,325
Kuraray Co., Ltd.		5,200		78,971
Maruichi Steel Tube Ltd.		700		17,701
Mitsubishi Chemical Holdings Corp.		20,500		99,981
Mitsubishi Gas Chemical Co., Inc.		6,000		45,873
Mitsubishi Materials Corp.		17,000		48,763
Mitsui Chemicals, Inc.		12,000		27,771
Nippon Paper Industries Co., Ltd. *		1,500		22,468
Nissan Chemical Industries Ltd.		17,100		221,642
Nitto Denko Corp.		34,900		2,292,913

See financial notes 39

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number			Value
Security	of Shares			($)
Oji Holdings Corp.		13,000			46,402
Shin-Etsu Chemical Co., Ltd.		40,724			2,745,302
Showa Denko K.K.		22,000			35,524
Sumitomo Chemical Co., Ltd.		24,000			80,368
Sumitomo Metal Mining Co., Ltd.		8,000			111,995
Taiheiyo Cement Corp.		16,000			41,554
Taiyo Holdings Co., Ltd.		74,200			2,345,296
Taiyo Nippon Sanso Corp.		4,000			26,579
Teijin Ltd.		14,000			33,729
Toray Industries, Inc.		23,000			161,702
Toyo Seikan Kaisha Ltd.		2,300			31,520
Ube Industries Ltd.		15,000			30,329
Yamato Kogyo Co., Ltd.		600			19,845
					12,347,539
Media 0.0%
Dentsu, Inc.		2,900			100,814
Hakuhodo DY Holdings, Inc.		350			28,845
Toho Co., Ltd.		1,700			37,799
					167,458
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
Astellas Pharma, Inc.		79,700			4,645,319
Chugai Pharmaceutical Co., Ltd.		3,400			84,651
Daiichi Sankyo Co., Ltd.		10,500			205,450
Dainippon Sumitomo Pharma Co., Ltd.		2,400			44,082
Eisai Co., Ltd.		3,800			173,410
Hisamitsu Pharmaceutical Co., Inc.		900			52,919
Kyowa Hakko Kirin Co., Ltd.		4,000			49,098
Mitsubishi Tanabe Pharma Corp.		3,400			51,719
Ono Pharmaceutical Co., Ltd.		1,300			85,739
Otsuka Holdings Co., Ltd.		5,400			194,736
Santen Pharmaceutical Co., Ltd.		1,100			55,214
Shionogi & Co., Ltd.		4,500			110,686
Taisho Pharmaceutical Holdings Co., Ltd.		600			44,486
Takeda Pharmaceutical Co., Ltd.		12,200			669,801
Tsumura & Co.		900			29,408
					6,496,718
Real Estate 0.3%
Aeon Mall Co., Ltd.		1,100			35,415
Daito Trust Construction Co., Ltd.		1,100			106,657
Daiwa House Industry Co., Ltd.		8,000			180,817
Hulic Co., Ltd.		3,700			41,148
Japan Prime Realty Investment Corp.		11			40,422
Japan Real Estate Investment Corp.		9			120,901
Japan Retail Fund Investment Corp.		34			80,596
Mitsubishi Estate Co., Ltd.		19,000			618,851
Mitsui Fudosan Co., Ltd.		13,000			442,429
Nippon Building Fund, Inc.		11			158,492
Nomura Real Estate Holdings, Inc.		2,000			53,768
Nomura Real Estate Office Fund, Inc.		4			25,558
NTT Urban Development Corp.		17			25,205
Sumitomo Realty & Development Co., Ltd.		6,000			283,568
Tokyu Land Corp.		7,000			86,065
Tokyu Livable, Inc.		143,800			3,525,748
					5,825,640
Retailing 0.8%
ABC-Mart, Inc.		6,700			250,984
Don Quijote Co., Ltd.		70,200			3,825,199
Fast Retailing Co., Ltd.		800			293,371
Isetan Mitsukoshi Holdings Ltd.		5,600			89,252
J. Front Retailing Co., Ltd.		7,000			58,809
Jin Co., Ltd.		48,400			2,863,532
Marui Group Co., Ltd.		3,300			38,305
Nitori Holdings Co., Ltd.		550			41,493
Rakuten, Inc.		11,400			121,597
Ryohin Keikaku Co., Ltd.		37,600			3,550,856
Sanrio Co., Ltd.		700			35,148
Seria Co., Ltd.		129,400			3,159,432
Shimamura Co., Ltd.		10,242			1,294,401
Takashimaya Co., Ltd.		4,000			47,282
United Arrows Ltd.		14,400			558,307
USS Co., Ltd.		330			42,334
Yamada Denki Co., Ltd.		1,420			68,527
					16,338,829
Semiconductors & Semiconductor Equipment 0.4%
Advantest Corp.		2,200			32,962
Rohm Co., Ltd.		241,800			8,548,014
Sumco Corp.		1,700			17,845
Tokyo Electron Ltd.		2,700			138,197
					8,737,018
Software & Services 0.3%
Dena Co., Ltd.		1,500			42,729
Gree, Inc.		1,400			17,944
Itochu Techno-Solutions Corp.		400			19,035
Kakaku.com, Inc.		23,700			612,691
Konami Corp.		1,400			31,936
Nexon Co., Ltd.		98,800			1,199,547
Nintendo Co., Ltd.		1,600			176,596
Nomura Research Institute Ltd.		1,500			45,184
NTT Data Corp.		19			60,156
Oracle Corp., Japan		600			25,705
Otsuka Corp.		246			25,502
Trend Micro, Inc.		1,600			44,859
Yahoo Japan Corp.		7,628			3,832,992
					6,134,876
Technology Hardware & Equipment 2.0%
Anritsu Corp.		175,300			2,621,418
Brother Industries Ltd.		3,500			40,026
Canon, Inc.		327,960			11,794,916
Citizen Holdings Co., Ltd.		3,900			23,072
FUJIFILM Holdings Corp.		7,200			147,913
Fujitsu Ltd.		29,000			121,802
Hamamatsu Photonics K.K.		1,000			41,230
Hirose Electric Co., Ltd.		500			71,895
Hitachi High-Technologies Corp.		900			22,483
Hitachi Ltd.		73,000	��		466,532
Horiba Ltd.		159,400			5,763,036
Hoya Corp.		6,800			136,247
Ibiden Co., Ltd.		1,800			31,552
Japan Aviation Electronics Industry Ltd.		213,000			1,845,870
Keyence Corp.		9,300			2,951,317
Konica Minolta Holdings, Inc.		8,000			56,519

40 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Kyocera Corp.		2,400		244,134
Murata Manufacturing Co., Ltd.		3,124		254,399
NEC Corp.		39,000		101,314
Nippon Electric Glass Co., Ltd.		6,000		30,625
Omron Corp.		384,200		12,136,829
Ricoh Co., Ltd.		10,000		111,271
Shimadzu Corp.		4,000		29,228
TDK Corp.		1,900		69,477
Toshiba Corp.		62,000		341,879
Yaskawa Electric Corp.		3,321		40,635
Yokogawa Electric Corp.		3,200		32,541
				39,528,160
Telecommunication Services 0.1%
KDDI Corp.		8,200		394,316
Nippon Telegraph & Telephone Corp.		6,800		338,165
NTT DoCoMo, Inc.		237		392,448
Softbank Corp.		14,600		724,071
				1,849,000
Transportation 0.1%
ANA Holdings, Inc.		19,000		41,383
Central Japan Railway Co.		2,200		265,327
East Japan Railway Co.		5,238		442,175
Hankyu Hanshin Holdings, Inc.		17,000		110,079
Japan Airlines Co., Ltd.		900		45,703
Kamigumi Co., Ltd.		4,000		37,507
Keikyu Corp.		7,000		77,464
Keio Corp.		9,000		77,416
Keisei Electric Railway Co., Ltd.		4,266		45,103
Kintetsu Corp.		26,000		131,513
Mitsubishi Logistics Corp.		2,000		35,754
Mitsui O.S.K. Lines, Ltd. *		17,000		70,794
Nippon Express Co., Ltd.		13,000		67,664
Nippon Yusen K.K.		27,000		70,485
Odakyu Electric Railway Co., Ltd.		10,000		120,430
Tobu Railway Co., Ltd.		16,000		93,012
Tokyu Corp.		17,000		134,812
West Japan Railway Co.		2,700		130,632
Yamato Holdings Co., Ltd.		6,000		115,740
				2,112,993
Utilities 0.1%
Chubu Electric Power Co., Inc.		9,931		128,567
Electric Power Development Co., Ltd.		1,900		54,264
Hokkaido Electric Power Co., Inc. *		2,700		34,260
Hokuriku Electric Power Co.		2,500		36,871
Kyushu Electric Power Co., Inc. *		6,400		88,406
Osaka Gas Co., Ltd.		30,000		130,021
Shikoku Electric Power Co., Inc. *		2,700		48,942
The Chugoku Electric Power Co., Inc.		4,500		64,590
The Kansai Electric Power Co., Inc. *		11,700		142,943
Toho Gas Co., Ltd.		6,330		37,742
Tohoku Electric Power Co., Inc. *		6,800		72,831
Tokyo Electric Power Co., Inc. *		21,700		96,057
Tokyo Gas Co., Ltd.		37,000		211,201
				1,146,695
				310,710,898
Luxembourg 0.2%
Energy 0.2%
Subsea 7 S.A.		4,220		91,103
Tenaris S.A. ADR		96,750		4,304,407
				4,395,510
Materials 0.0%
ArcelorMittal		15,267		188,710
Media 0.0%
SES S.A.		4,524		141,098
Telecommunication Services 0.0%
Millicom International Cellular S.A. SDR		976		80,163
				4,805,481
Mexico 0.2%
Banks 0.1%
Banregio Grupo Financiero S.A.B de C.V.		163,700		903,146
Diversified Financials 0.1%
Compartamos S.A.B. de C.V.		1,501,380		2,500,177
Materials 0.0%
Grupo Mexico S.A.B. de C.V., Series B		113,400		405,884
Media 0.0%
Grupo Televisa S.A. ADR		28,000		708,960
				4,518,167
Netherlands 3.1%
Capital Goods 1.2%
European Aeronautic Defence & Space Co., N.V.		6,885		363,746
Koninklijke Boskalis Westminster N.V.		308,971		12,889,867
Koninklijke Philips Electronics N.V.		347,756		9,625,203
				22,878,816
Commercial & Professional Supplies 0.0%
Randstad Holding N.V.		1,794		74,782
Diversified Financials 0.0%
ING Groep N.V. CVA *		58,185		479,319
Energy 0.6%
Core Laboratories N.V.		26,100		3,778,758
Fugro N.V. CVA		1,037		59,914
Royal Dutch Shell plc, B Shares		40,104		1,406,745
Schlumberger Ltd.		75,725		5,636,212
				10,881,629
Food & Staples Retailing 0.2%
Koninklijke Ahold N.V.		312,755		4,940,657
Food, Beverage & Tobacco 0.7%
DE Master Blenders 1753 N.V. *		9,102		144,322
Heineken Holding N.V.		34,259		2,064,350
Heineken N.V.		3,567		252,453
Unilever N.V. CVA		178,838		7,620,527
Unilever N.V., NY Shares		66,975		2,845,098
				12,926,750

See financial notes 41

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Insurance 0.0%
Aegon N.V.		26,811		179,091
Delta Lloyd N.V.		2,918		56,108
				235,199
Materials 0.4%
Akzo Nobel N.V.		116,582		7,031,103
James Hardie Industries plc CDI		6,557		69,065
Koninklijke DSM N.V.		2,431		156,692
				7,256,860
Media 0.0%
Reed Elsevier N.V.		10,856		176,202
Wolters Kluwer N.V.		4,864		107,633
				283,835
Real Estate 0.0%
Corio N.V.		1,077		49,880
Semiconductors & Semiconductor Equipment 0.0%
ASML Holding N.V.		4,758		354,057
Telecommunication Services 0.0%
Koninklijke (Royal) KPN N.V.		15,435		32,343
Ziggo N.V.		1,828		65,371
				97,714
Transportation 0.0%
Koninklijke Vopak N.V.		1,054		58,368
TNT Express N.V.		5,294		40,675
				99,043
				60,558,541
New Zealand 0.6%
Consumer Services 0.3%
SKYCITY Entertainment Group Ltd.		1,223,525		4,680,154
Health Care Equipment & Services 0.0%
Ryman Healthcare Ltd.		114,901		601,146
Materials 0.0%
Fletcher Building Ltd.		10,175		77,192
Retailing 0.1%
Trade Me Ltd.		617,520		2,616,045
Telecommunication Services 0.0%
Telecom Corp. of New Zealand Ltd.		28,860		64,445
Transportation 0.2%
Auckland International Airport Ltd.		1,617,429		4,299,343
Utilities 0.0%
Contact Energy Ltd.		5,211		23,584
				12,361,909
Nigeria 0.1%
Banks 0.1%
Guaranty Trust Bank plc GDR - Reg’d		139,777		1,146,171
Norway 1.5%
Banks 0.0%
DnB A.S.A.		15,192		248,777
Energy 0.9%
Aker Solutions A.S.A.		2,465		34,500
Farstad Shipping A.S.A.		94,566		1,980,274
Fred Olsen Energy A.S.A.		89,324		3,896,793
Petroleum Geo-Services A.S.A.		143,580		2,109,536
Seadrill Ltd.		5,407		208,351
Statoil A.S.A.		346,968		8,494,249
TGS Nopec Geophysical Co. A.S.A.		40,804		1,467,195
				18,190,898
Food, Beverage & Tobacco 0.0%
Orkla A.S.A.		11,571		104,339
Insurance 0.0%
Gjensidige Forsikring A.S.A.		2,999		48,365
Materials 0.1%
Norsk Hydro A.S.A.		13,961		65,751
Yara International A.S.A.		2,941		138,150
Yara International A.S.A. ADR		11,100		520,368
				724,269
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Algeta A.S.A. *		9,603		326,333
Telecommunication Services 0.3%
Telenor A.S.A.		235,895		5,315,879
Transportation 0.2%
Norwegian Air Shuttle A.S.A. *		77,990		3,750,952
				28,709,812
Philippines 0.0%
Banks 0.0%
Security Bank Corp.		95,340		457,043
Poland 0.0%
Banks 0.0%
Alior Bank S.A. *		11,599		260,902
Food & Staples Retailing 0.0%
Eurocash S.A.		34,301		617,664
				878,566
Portugal 0.0%
Banks 0.0%
Banco Espirito Santo, S.A. - Reg’d *		30,126		34,518
Energy 0.0%
Galp Energia, SGPS, S.A.		4,438		71,127
Food & Staples Retailing 0.0%
Jeronimo Martins, SGPS, S.A.		3,303		78,668
Telecommunication Services 0.0%
Portugal Telecom, SGPS, S.A. - Reg’d		10,082		52,606
Utilities 0.0%
EDP - Energias de Portugal S.A.		28,618		98,360
				335,279

42 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Republic of Korea 0.8%
Capital Goods 0.1%
Sung Kwang Bend Co., Ltd.		43,130		928,055
Media 0.0%
Cheil Worldwide, Inc. *		6,820		168,606
Retailing 0.2%
GS Home Shopping, Inc.		2,876		594,368
Kolao Holdings		150,948		4,115,461
				4,709,829
Semiconductors & Semiconductor Equipment 0.3%
Samsung Electronics Co., Ltd.		3,615		4,999,614
Technology Hardware & Equipment 0.2%
Partron Co., Ltd. (b)		203,780		4,310,081
				15,116,185
Singapore 3.6%
Banks 0.1%
DBS Group Holdings Ltd.		28,000		381,956
Oversea-Chinese Banking Corp., Ltd.		40,000		353,119
United Overseas Bank Ltd.		20,000		347,546
				1,082,621
Capital Goods 0.3%
Keppel Corp., Ltd.		433,500		3,781,308
SembCorp Industries Ltd.		15,000		60,955
SembCorp Marine Ltd.		13,000		45,672
Singapore Technologies Engineering Ltd.		264,000		944,868
Tat Hong Holdings Ltd.		1,277,000		1,546,411
Yangzijiang Shipbuilding Holdings Ltd.		29,000		22,456
				6,401,670
Consumer Services 0.0%
Genting Singapore plc		96,000		119,971
Diversified Financials 0.0%
Singapore Exchange Ltd.		13,000		79,161
Energy 0.4%
Ezion Holdings Ltd.		2,194,000		3,645,611
Ezra Holdings Ltd. *		5,292,000		4,119,498
				7,765,109
Food & Staples Retailing 0.0%
Olam International Ltd.		22,000		30,063
Food, Beverage & Tobacco 0.0%
First Resources Ltd.		488,000		686,739
Golden Agri-Resources Ltd.		117,000		50,418
Wilmar International Ltd.		29,000		78,721
				815,878
Media 0.0%
Singapore Press Holdings Ltd.		26,000		94,226
Real Estate 1.0%
Ascendas REIT		3,447,000		7,717,981
CapitaCommercial Trust		30,000		41,771
CapitaLand Ltd.		38,000		115,887
CapitaMall Trust		6,187,200		11,666,305
CapitaMalls Asia Ltd.		20,000		34,196
City Developments Ltd.		8,000		73,344
Global Logistic Properties Ltd.		34,000		76,523
Keppel Land Ltd.		11,000		36,342
Keppel REIT		86,700		106,404
UOL Group Ltd.		7,000		40,643
				19,909,396
Retailing 0.1%
Jardine Cycle & Carriage Ltd.		2,000		79,269
Osim International Ltd.		1,627,000		2,642,063
				2,721,332
Telecommunication Services 0.5%
Singapore Telecommunications Ltd.		121,000		385,651
StarHub Ltd.		2,313,000		8,894,626
				9,280,277
Transportation 1.0%
ComfortDelGro Corp., Ltd.		28,000		45,177
Hutchison Port Holdings Trust, Class U		78,000		64,854
SATS Ltd.		3,213,000		8,214,639
SIA Engineering Co., Ltd. (b)		2,505,000		10,296,372
Singapore Airlines Ltd.		8,331		74,570
SMRT Corp., Ltd.		1,379,553		1,657,830
				20,353,442
Utilities 0.2%
Hyflux Ltd.		3,057,000		3,406,722
				72,059,868
South Africa 0.3%
Capital Goods 0.1%
Bidvest Group Ltd.		70,940		1,846,430
Diversified Financials 0.1%
Coronation Fund Managers Ltd.		68,526		410,079
FirstRand Ltd.		585,573		2,037,269
				2,447,348
Health Care Equipment & Services 0.1%
Life Healthcare Group Holdings Pte Ltd.		303,333		1,281,479
				5,575,257
Spain 1.1%
Banks 0.7%
Banco Bilbao Vizcaya Argentaria S.A. (a)		1,481		14,371
Banco Bilbao Vizcaya Argentaria S.A.		82,918		807,171
Banco de Sabadell S.A.		43,861		91,112
Banco Popular Espanol S.A.		77,676		60,478
Banco Santander S.A.		1,766,923		12,759,917
Bankia S.A. *		186		980
CaixaBank		16,959		62,707
				13,796,736
Capital Goods 0.0%
ACS, Actividades de Construccion y Servicios S.A.		2,274		58,403
Ferrovial S.A.		5,945		98,345

See financial notes 43

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Zardoya Otis S.A.		2,201		30,751
				187,499
Commercial & Professional Supplies 0.2%
Prosegur Cia de Seguridad S.A. - Reg’d		679,458		3,798,084
Energy 0.0%
Repsol S.A.		12,974		304,170
Food & Staples Retailing 0.0%
Distribuidora Internacional de Alimentacion S.A.		8,853		68,623
Food, Beverage & Tobacco 0.1%
Viscofan S.A.		14,011		727,739
Insurance 0.0%
Mapfre S.A.		11,544		42,280
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Grifols S.A. *		2,426		97,380
Retailing 0.0%
Inditex S.A.		3,310		444,220
Software & Services 0.0%
Amadeus IT Holding S.A., A Shares		4,972		146,707
Telecommunication Services 0.1%
Telefonica S.A.		63,206		925,482
Transportation 0.0%
Abertis Infraestructuras S.A.		5,664		105,686
International Consolidated Airlines Group S.A. *		13,910		58,595
				164,281
Utilities 0.0%
Acciona S.A.		381		24,925
Enagas S.A.		3,153		83,968
Gas Natural SDG S.A.		5,204		108,970
Iberdrola S.A.		73,110		393,081
Red Electrica Corp. S.A.		1,623		86,277
				697,221
				21,400,422
Sweden 1.9%
Banks 0.1%
Nordea Bank AB		39,884		479,925
Skandinaviska Enskilda Banken AB, A Shares		21,986		226,178
Svenska Handelsbanken AB, A Shares		7,485		341,227
Swedbank AB, A Shares		12,577		309,691
				1,357,021
Capital Goods 0.6%
Alfa Laval AB		5,063		111,604
Assa Abloy AB, B Shares		47,313		1,893,408
Atlas Copco AB, A Shares		152,234		4,025,433
Atlas Copco AB, B Shares		173,150		4,131,261
Sandvik AB		15,586		222,312
Scania AB, B Shares		4,727		101,093
Skanska AB, B Shares		5,997		102,308
SKF AB, B Shares		6,116		142,774
Volvo AB, B Shares		22,768		315,560
				11,045,753
Commercial & Professional Supplies 0.2%
AF AB, B Shares		168,963		4,652,746
Securitas AB, B Shares		4,695		46,201
				4,698,947
Consumer Durables & Apparel 0.0%
Electrolux AB, B Shares		3,606		102,631
Husqvarna AB, B Shares		6,685		38,681
				141,312
Diversified Financials 0.0%
Industrivarden AB, C Shares		1,765		33,107
Investment AB Kinnevik, B Shares		3,084		80,853
Investor AB, B Shares		7,103		210,653
Ratos AB, B Shares		2,873		27,761
				352,374
Energy 0.0%
Lundin Petroleum AB *		3,337		80,238
Food, Beverage & Tobacco 0.2%
AarhusKarlshamn AB		71,270		3,738,869
Swedish Match AB		3,051		105,841
				3,844,710
Health Care Equipment & Services 0.0%
Elekta AB, B Shares		5,993		91,893
Getinge AB, B Shares		3,001		90,489
				182,382
Household & Personal Products 0.0%
Svenska Cellulosa AB, B Shares		9,015		234,830
Materials 0.2%
BillerudKorsnas AB		178,430		1,771,059
Boliden AB		4,101		65,493
Hexpol AB		16,440		926,978
				2,763,530
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Meda AB, A Shares		137,050		1,640,549
Retailing 0.5%
Hennes & Mauritz AB, B Shares		298,310		10,594,071
Technology Hardware & Equipment 0.0%
Hexagon AB, B Shares		3,800		109,016
Telefonaktiebolaget LM Ericsson, B Shares		47,070		585,380
				694,396
Telecommunication Services 0.0%
Tele2 AB, B Shares		4,754		81,575
TeliaSonera AB		33,575		231,659
				313,234
				37,943,347
Switzerland 7.6%
Banks 0.0%
Banque Cantonale Vaudoise - Reg’d		44		24,380
Capital Goods 0.3%
ABB Ltd. - Reg’d *		33,956		770,017

44 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Burckhardt Compression Holding AG		1,384		566,012
Geberit AG - Reg’d		14,189		3,467,538
Schindler Holding AG		720		108,046
Schindler Holding AG - Reg’d		323		47,307
Sulzer AG - Reg’d		360		61,520
				5,020,440
Commercial & Professional Supplies 0.7%
Adecco S.A. - Reg’d *		216,187		11,563,570
SGS S.A. - Reg’d		1,049		2,536,624
				14,100,194
Consumer Durables & Apparel 0.5%
Compagnie Financiere Richemont S.A., Series A		107,335		8,686,481
The Swatch Group AG - Bearer Shares		479		274,812
The Swatch Group AG - Reg’d		651		65,465
				9,026,758
Diversified Financials 1.6%
Credit Suisse Group AG - Reg’d *		980,785		27,237,411
GAM Holding AG *		92,830		1,641,692
Julius Baer Group Ltd. *		3,221		128,403
Pargesa Holding S.A.		405		28,248
Partners Group Holding AG		8,841		2,268,289
UBS AG - Reg’d		56,189		1,002,322
				32,306,365
Energy 0.6%
Noble Corp.		156,750		5,878,125
Transocean Ltd. *		51,648		2,657,423
Weatherford International Ltd. *		256,375		3,279,036
				11,814,584
Food, Beverage & Tobacco 0.9%
Aryzta AG *		1,308		81,214
Barry Callebaut AG - Reg’d *		27		26,379
Coca Cola HBC AG *		2,937		74,882
Lindt & Spruengli AG		15		58,104
Lindt & Spruengli AG - Reg’d		2		89,127
Nestle S.A. - Reg’d		130,112		9,278,605
Nestle S.A. - Reg’d ADR		107,312		7,643,834
				17,252,145
Health Care Equipment & Services 0.0%
Sonova Holding AG - Reg’d *		737		80,287
Insurance 0.1%
Baloise Holding AG - Reg’d		712		73,390
Swiss Life Holding AG - Reg’d *		457		72,400
Swiss Re AG *		5,336		424,647
Zurich Insurance Group AG *		2,278		636,568
				1,207,005
Materials 1.1%
Ems-Chemie Holding AG - Reg’d		124		35,859
Givaudan S.A. - Reg’d *		3,561		4,585,958
Glencore International plc		1,445,501		7,145,895
Holcim Ltd. - Reg’d *		85,036		6,633,233
Sika AG		35		84,576
Syngenta AG - Reg’d		8,402		3,592,016
				22,077,537
Pharmaceuticals, Biotechnology & Life Sciences 1.1%
Actelion Ltd. - Reg’d *		1,659		101,578
Lonza Group AG - Reg’d *		754		52,540
Novartis AG - Reg’d		90,402		6,692,241
Novartis AG ADR		45,375		3,346,860
Roche Holding AG		45,351		11,353,187
				21,546,406
Real Estate 0.0%
Swiss Prime Site AG - Reg’d *		883		72,404
Software & Services 0.1%
Temenos Group AG - Reg’d *		109,130		2,580,870
Telecommunication Services 0.0%
Swisscom AG - Reg’d		365		171,922
Transportation 0.6%
Kuehne & Nagel International AG - Reg’d		109,010		12,486,352
				149,767,649
Taiwan 1.3%
Capital Goods 0.2%
AirTac International Group		443,000		2,352,399
Teco Electric & Machinery Co., Ltd.		1,973,000		1,856,843
				4,209,242
Consumer Durables & Apparel 0.2%
Eclat Textile Co., Ltd.		107,000		646,186
Makalot Industrial Co., Ltd.		630,000		2,669,914
				3,316,100
Diversified Financials 0.2%
Chailease Holding Co., Ltd.		1,234,000		3,717,691
Health Care Equipment & Services 0.0%
St. Shine Optical Co., Ltd.		4,244		89,402
Semiconductors & Semiconductor Equipment 0.6%
Chipbond Technology Corp.		1,166,000		2,972,447
Taiwan Semiconductor Manufacturing Co., Ltd. ADR		316,065		6,030,520
Vanguard International Semiconductor Corp.		2,575,000		2,812,710
				11,815,677
Technology Hardware & Equipment 0.1%
Asustek Computer, Inc.		192,000		2,236,291
				25,384,403
Thailand 0.5%
Banks 0.1%
Kasikornbank PCL		311,800		2,298,267
Consumer Services 0.1%
Minor International PCL		2,060,300		2,105,928
Media 0.0%
BEC World PCL		303,500		692,828
Real Estate 0.1%
Asian Property Development PCL		5,770,200		1,848,037
Retailing 0.1%
Home Product Center PCL (b)		2,026,283		1,035,579

See financial notes 45

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Telecommunication Services 0.1%
Advanced Info Service PCL - Reg’d		255,100		2,346,746
				10,327,385
Turkey 0.2%
Banks 0.1%
Turkiye Halk Bankasi A/S		220,084		2,403,151
Food & Staples Retailing 0.1%
Bizim Toptan Satis Magazalari A/S		50,380		849,627
Transportation 0.0%
Pegasus Hava Tasimaciligi A/S *		63,500		648,194
				3,900,972
United Kingdom 19.6%
Automobiles & Components 0.0%
GKN plc		23,980		102,646
Banks 1.1%
Barclays plc		179,508		801,050
HSBC Holdings plc		283,219		3,101,811
Lloyds Banking Group plc *		18,737,115		15,917,045
Royal Bank of Scotland Group plc *		31,558		150,589
Standard Chartered plc		37,199		936,202
				20,906,697
Capital Goods 4.1%
Ashtead Group plc		969,080		8,862,672
BAE Systems plc		49,054		286,509
Balfour Beatty plc		10,304		34,600
Bodycote plc		824,675		6,644,407
Bunzl plc		75,694		1,505,734
Cobham plc		994,690		3,875,227
Fenner plc		583,722		3,192,873
IMI plc		72,715		1,401,665
Interserve plc		629,856		4,636,724
Invensys plc		12,175		72,892
Keller Group plc		89,759		1,198,376
Meggitt plc		200,710		1,462,808
Melrose Industries plc		18,513		70,174
Rolls-Royce Holdings plc *		275,225		4,838,259
Rolls-Royce Holdings plc, C Shares (a)*		32,751,775		50,875
Rotork plc		443,063		20,044,729
Senior plc		95,129		377,553
Smiths Group plc		290,231		5,644,801
Spirax-Sarco Engineering plc		191,835		7,836,681
The Weir Group plc		3,386		116,160
Ultra Electronics Holdings plc		257,238		6,599,930
Wolseley plc		38,686		1,916,083
				80,669,732
Commercial & Professional Supplies 0.9%
Aggreko plc		4,162		115,373
Babcock International Group plc		192,573		3,204,425
Capita plc		10,322		144,745
De La Rue plc		570,562		8,255,720
G4S plc		21,153		102,964
Intertek Group plc		2,390		122,953
RPS Group plc		98,469		382,006
Serco Group plc		539,478		5,191,715
				17,519,901
Consumer Durables & Apparel 0.8%
Barratt Developments plc *		1,396,090		6,758,214
Bellway plc		322,040		6,736,366
Berkeley Group Holdings plc		86,942		2,819,030
Burberry Group plc		6,834		142,170
				16,455,780
Consumer Services 0.7%
Carnival plc		2,747		99,177
Compass Group plc		246,836		3,250,844
Greene King plc		400,266		4,523,802
InterContinental Hotels Group plc		167,768		4,956,892
Restaurant Group plc		12,111		90,745
TUI Travel plc		7,543		36,880
Whitbread plc		2,643		105,068
William Hill plc		222,062		1,471,470
				14,534,878
Diversified Financials 1.0%
3i Group plc		14,557		74,439
Aberdeen Asset Management plc		256,334		1,789,290
Ashmore Group plc		267,313		1,660,204
Close Brothers Group plc		155,500		2,510,470
Hargreaves Lansdown plc		50,947		775,895
ICAP plc		8,336		37,364
IG Group Holdings plc		126,879		1,062,708
Investec plc		8,046		56,976
Jupiter Fund Management plc		169,409		872,147
London Stock Exchange Group plc		2,950		61,556
Provident Financial plc		22,172		562,031
Schroders plc		304,995		11,077,078
Schroders plc, Non Voting Shares		1,100		31,665
				20,571,823
Energy 0.8%
AMEC plc		4,981		78,520
BG Group plc		52,491		886,118
BP plc		293,522		2,126,902
Enquest plc *		840,540		1,683,998
John Wood Group plc		411,086		4,961,695
Petrofac Ltd.		3,837		80,646
Royal Dutch Shell plc, A Shares		57,421		1,954,914
Tullow Oil plc		250,266		3,901,075
				15,673,868
Food & Staples Retailing 0.3%
J. Sainsbury plc		18,131		107,452
Tesco plc		1,182,295		6,724,872
WM Morrison Supermarkets plc		34,299		155,657
				6,987,981
Food, Beverage & Tobacco 1.4%
Associated British Foods plc		5,619		169,029
British American Tobacco plc		29,631		1,642,601
British American Tobacco plc ADR		43,300		4,807,166
Diageo plc		399,169		12,189,649
Diageo plc ADR		48,725		5,954,195
Imperial Tobacco Group plc		15,069		538,805
SABMiller plc		14,784		797,704
Tate & Lyle plc		7,497		98,387

46 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Unilever plc		19,810		858,302
				27,055,838
Health Care Equipment & Services 0.0%
Smith & Nephew plc		13,959		159,783
Household & Personal Products 0.3%
Reckitt Benckiser Group plc		75,356		5,501,055
Insurance 1.4%
Admiral Group plc		3,040		60,557
Amlin plc		235,584		1,553,933
Aviva plc		44,994		213,609
Hiscox Ltd.		108,986		949,979
Lancashire Holdings Ltd.		319,372		4,204,957
Legal & General Group plc		91,272		240,697
Old Mutual plc		75,509		240,843
Prudential plc		434,613		7,472,983
Resolution Ltd.		21,377		87,787
RSA Insurance Group plc		52,603		91,087
Standard Life plc		36,765		214,220
Willis Group Holdings plc		288,800		11,459,584
				26,790,236
Materials 2.3%
Anglo American plc		21,143		516,962
Antofagasta plc		5,862		82,256
AZ Electronic Materials S.A.		1,831,445		8,109,716
BHP Billiton plc		32,585		916,707
Croda International plc		373,159		14,385,098
Elementis plc		217,639		893,486
Eurasian Natural Resources Corp.		3,862		16,608
Evraz plc		4,952		12,051
Fresnillo plc		2,689		48,603
Johnson Matthey plc		3,228		121,769
Kazakhmys plc		3,210		17,448
Randgold Resources Ltd.		1,346		108,895
Rexam plc		787,240		6,321,107
Rio Tinto plc		20,680		949,627
Rio Tinto plc ADR		96,700		4,454,002
Vedanta Resources plc		1,793		33,927
Victrex plc		352,754		8,800,794
Xstrata plc		31,933		480,543
				46,269,599
Media 0.5%
British Sky Broadcasting Group plc		16,255		213,033
ITV plc		1,933,569		3,780,946
Pearson plc		12,645		229,982
Reed Elsevier plc		18,961		221,679
Rightmove plc		38,610		1,151,823
UBM plc		307,260		3,494,541
WPP plc		19,544		323,108
				9,415,112
Pharmaceuticals, Biotechnology & Life Sciences 0.5%
Abcam plc		100,973		688,556
AstraZeneca plc		19,208		997,298
GlaxoSmithKline plc		295,604		7,627,018
				9,312,872
Real Estate 0.4%
Big Yellow Group plc		90,425		566,763
British Land Co., plc		14,802		136,926
Countrywide plc *		373,686		2,703,516
Derwent London plc		24,488		878,635
Great Portland Estates plc		328,170		2,714,766
Hammerson plc		10,685		86,340
Intu Properties plc		10,954		58,341
Land Securities Group plc		12,150		165,054
Segro plc		11,121		46,050
				7,356,391
Retailing 0.5%
ASOS plc *		54,630		2,718,483
Dunelm Group plc		102,317		1,345,104
Howden Joinery Group plc		748,928		2,896,391
Kingfisher plc		36,805		179,337
Marks & Spencer Group plc		24,746		157,514
Next plc		2,596		175,974
Ocado Group plc *		99,879		263,750
Signet Jewelers Ltd.		41,200		2,831,676
				10,568,229
Semiconductors & Semiconductor Equipment 0.1%
ARM Holdings plc		72,451		1,126,896
Software & Services 0.3%
Anite plc		799,870		1,522,541
Moneysupermarket.com Group plc		306,353		955,078
Telecity Group plc		247,440		3,551,253
The Sage Group plc		19,846		104,124
				6,132,996
Technology Hardware & Equipment 1.8%
Diploma plc		609,297		5,399,505
Domino Printing Sciences plc		589,965		6,110,866
Halma plc		718,096		5,590,195
Laird plc		1,482,570		5,003,633
Oxford Instruments		10,460		250,714
Spectris plc		321,791		10,563,066
TT Electronics plc		993,774		2,570,225
				35,488,204
Telecommunication Services 0.2%
BT Group plc		119,456		513,616
Inmarsat plc		6,807		76,513
TalkTalk Telecom Group plc		418,690		1,630,483
Vodafone Group plc		757,131		2,310,230
				4,530,842
Transportation 0.1%
easyJet plc		70,519		1,226,289
Utilities 0.1%
Centrica plc		78,784		454,406
National Grid plc		56,210		716,520
Severn Trent plc		3,562		100,951
SSE plc		14,882		360,321
United Utilities Group plc		10,763		123,992
				1,756,190
				386,113,838
United States 0.1%
Food, Beverage & Tobacco 0.0%
Bunge Ltd.		14,600		1,054,266

See financial notes 47

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Insurance 0.1%
PartnerRe Ltd.		15,925		1,502,365
				2,556,631
Total Common Stock
(Cost $1,443,383,135)				1,883,771,818
Preferred Stock 0.1% of net assets
Germany 0.1%
Automobiles & Components 0.1%
Bayerische Motoren Werke AG		783		54,517
Porsche Automobil Holding SE		2,393		187,911
Volkswagen AG		2,195		445,757
				688,185
Household & Personal Products 0.0%
Henkel AG & Co. KGaA		2,771		261,602
Media 0.0%
ProSiebenSat.1 Media AG		1,514		57,786
Utilities 0.0%
RWE AG		585		19,919
Total Preferred Stock
(Cost $803,694)				1,027,492
Other Investment Companies 3.7% of net assets
Equity Funds 0.2%
iShares Asia Trust - iShares FTSE A50 China Index ETF		2,647,760		3,507,532
Market Vectors Junior Gold Miners ETF		64,240		823,557
				4,331,089
Money Market Fund 3.5%
State Street Institutional U.S. Government Money Market Fund		68,568,354		68,568,354
Total Other Investment Companies
(Cost $73,421,813)				72,899,443
Rights 0.0% of net assets
Netherlands 0.0%
Koninklijke (Royal) KPN N.V. *		15,435		20,734
Spain 0.0%
Banco Santander S.A. (a)*		1,653,723		346,281
Bankia S.A. *		186		304
				346,585
Total Rights
(Cost $419,648)				367,319
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.1% of net assets
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.05%, 06/13/13 (d)(e)		5,000		5,000
0.06%, 06/13/13 (d)(e)		10,000		9,999
0.09%, 06/13/13 (d)(e)		50,000		49,995
0.01%, 06/20/13 (d)(e)		100,000		99,990
0.03%, 06/20/13 (d)(e)		100,000		99,990
0.04%, 06/20/13 (d)(e)		400,000		399,961
0.09%, 06/20/13 (d)(e)		1,506,000		1,505,854
Total Short-Term Investments
(Cost $2,170,789)				2,170,789
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $1,550,155,524 and the unrealized appreciation and depreciation were $444,454,191 and ($34,372,854), respectively, with a net unrealized appreciation of $410,081,337.

At 04/30/13, the values of certain foreign securities held by the fund aggregating $1,594,711,676 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(b)	Illiquid security. At the period end, the value of these amounted to $22,319,257 or 1.1% of net assets.
(c)	Securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registrations, normally to qualified institutional buyers. At the period end, the value of these amounted to $253,336 or 0.0% of net assets.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.

ADR —	American Depositary Receipt
CVA —	Dutch Certificate
ETF —	Exchange traded fund
GDR —	Global Depositary Receipt
Reg’d —	Registered
REIT —	Real Estate Investment Trust
RSP —	Risparmio (Convertible Savings Shares)
SDR —	Swedish Depositary Receipt

AUD —	Australian dollar
CHF —	Swiss franc
EUR —	euro currency
GBP —	Great British pound
JPY —	Japanese yen
NZD —	New Zealand dollar
SEK —	Swedish krona
USD —	U.S. dollar
ZAR —	South African rand

48 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI EAFE, e-mini, Long, expires 06/21/13		387		33,684,480		1,453,144

				Amount of				Amount of		Unrealized
		Currency		Currency		Currency		Currency		Gains /
Expiration		to be		to be		to be		to be		(Losses)
Date	Counterparty	Received		Received		Delivered		Delivered		($)
Forward Foreign Currency Exchange Contracts
06/03/2013	Morgan Stanley & Co., Inc.		EUR		948,000		USD		1,248,716		35,911
06/19/2013	State Street Bank & Trust Co.		JPY		140,000,000		USD		1,436,465		(250,404	)
06/19/2013	State Street Bank & Trust Co.		JPY		242,000,000		USD		2,483,033		(334,196	)
06/19/2013	State Street Bank & Trust Co.		JPY		530,000,000		USD		5,438,047		(193,660	)
06/19/2013	State Street Bank & Trust Co.		JPY		417,000,000		USD		4,278,614		(120,352	)
09/18/2013	State Street Bank & Trust Co.		SEK		2,880,000		USD		443,100		2,193
07/31/2013	State Street Bank London		USD		16,449,721		AUD		15,972,500		(134,771	)
12/18/2013	State Street Bank & Trust Co.		USD		13,587,697		AUD		13,320,000		(37,261	)
09/18/2013	State Street Bank & Trust Co.		USD		22,620,715		CHF		21,000,000		175,638
06/03/2013	Morgan Stanley & Co., Inc.		USD		2,569,878		EUR		1,951,000		(77,842	)
06/04/2013	State Street Bank & Trust Co.		USD		8,782,276		GBP		5,655,000		5,311
06/04/2013	State Street Bank & Trust Co.		USD		8,050,808		GBP		5,184,000		(219,443	)
06/04/2013	State Street Bank & Trust Co.		USD		8,962,426		GBP		5,771,000		(103,075	)
06/19/2013	State Street Bank & Trust Co.		USD		24,779,026		JPY		2,415,000,000		6,299,655
07/31/2013	State Street Bank London		USD		5,604,508		NZD		6,579,000		(48,016	)
09/18/2013	State Street Bank & Trust Co.		USD		2,092,415		SEK		13,600,000		(46,502	)
09/18/2013	State Street Bank & Trust Co.		USD		2,738,602		SEK		17,800,000		(67,213	)
05/03/2013	State Street Bank & Trust Co.		USD		97,878		ZAR		878,310		(1,062	)
05/06/2013	State Street Bank & Trust Co.		USD		47,086		ZAR		422,695		(641	)
Net unrealized gains on Forward Foreign Currency Exchange Contracts											4,884,270

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

Assets Valuation Input

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Common Stock1		$—		$148,826,649		$—		$148,826,649
Australia1		—		59,158,591		—		59,158,591
Materials		5,668,326		24,247,311		—		29,915,637
Real Estate		4,870,397		15,561,715		—		20,432,112
Austria1		—		3,308,028		—		3,308,028
Semiconductors & Semiconductor Equipment		2,986,292		—		—		2,986,292
Belgium1		—		3,453,660		—		3,453,660
Pharmaceuticals, Biotechnology & Life Sciences		459,296		99,564		—		558,860
Brazil1		21,295,958		—		—		21,295,958
Canada1		72,665,354		—		—		72,665,354
Chile1		4,044,946		—		—		4,044,946

See financial notes 49

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
China1		$—		$22,974,610		$—		$22,974,610
Capital Goods		2,233,256		1,787,511		—		4,020,767
Pharmaceuticals, Biotechnology & Life Sciences		424,269		662,424		—		1,086,693
Technology Hardware & Equipment		454,643		2,989,482		—		3,444,125
Denmark1		—		25,207,253		—		25,207,253
Health Care Equipment & Services		92,763		1,283,368		—		1,376,131
France1		—		99,686,128		—		99,686,128
Consumer Services		124,510		73,210		—		197,720
Health Care Equipment & Services		3,461,497		344,665		—		3,806,162
Media		3,671,151		10,419,290		—		14,090,441
Pharmaceuticals, Biotechnology & Life Sciences		4,228,141		7,608,153		—		11,836,294
Real Estate		5,498,596		171,241		—		5,669,837
Telecommunication Services		79,560		763,924		—		843,484
Germany1		—		111,998,942		—		111,998,942
Materials		4,296,465		20,958,465		—		25,254,930
Media		4,255,850		149,192		—		4,405,042
Real Estate		3,150,751		1,489,664		—		4,640,415
Greece1		—		33,003		—		33,003
Telecommunication Services		32,742		—		—		32,742
Hong Kong1		—		47,619,514		—		47,619,514
Technology Hardware & Equipment		—		5,641,333		12,240		5,653,573
India1		—		10,948,393		—		10,948,393
Health Care Equipment & Services		1,639,755		—		—		1,639,755
Pharmaceuticals, Biotechnology & Life Sciences		4,096,861		2,318,590		—		6,415,451
Ireland1		—		12,776,330		—		12,776,330
Capital Goods		5,683,287		—		—		5,683,287
Food, Beverage & Tobacco		648,676		4,800,602		—		5,449,278
Transportation		538,933		—		—		538,933
Israel1		—		873,459		—		873,459
Software & Services		9,142,182		31,853		—		9,174,035
Japan1		—		301,759,763		—		301,759,763
Consumer Services		29,164		173,656		—		202,820
Food & Staples Retailing		288,388		8,459,927		—		8,748,315
Luxembourg1		—		409,971		—		409,971
Energy		4,304,407		91,103		—		4,395,510
Mexico1		4,518,167		—		—		4,518,167
Netherlands1		—		36,750,162		—		36,750,162
Energy		9,414,970		1,466,659		—		10,881,629
Food, Beverage & Tobacco		2,989,420		9,937,330		—		12,926,750
Nigeria1		1,146,171		—		—		1,146,171
Norway1		—		27,985,543		—		27,985,543
Materials		520,368		203,901		—		724,269
Poland1		—		260,902		—		260,902
Food & Staples Retailing		617,664		—		—		617,664

50 See financial notes

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Quoted Prices in					Significant
	Active Markets for		Significant Other			Unobservable
	Identical Assets		Observable Inputs			Inputs
Description	(Level 1)		(Level 2)			(Level 3)		Total
Portugal1		$—		$256,611			$—		$256,611
Food & Staples Retailing		78,668		—			—		78,668
Republic of Korea1		—		10,406,356			—		10,406,356
Retailing		594,368		4,115,461			—		4,709,829
South Africa1		—		1,846,430	��		—		1,846,430
Diversified Financials		410,079		2,037,269			—		2,447,348
Health Care Equipment & Services		1,281,479		—			—		1,281,479
Spain1		—		6,875,947			—		6,875,947
Banks		980		13,781,385			14,371		13,796,736
Food, Beverage & Tobacco		727,739		—			—		727,739
Sweden1		—		34,098,637			—		34,098,637
Food, Beverage & Tobacco		3,738,869		105,841			—		3,844,710
Switzerland1		—		99,154,514			—		99,154,514
Energy		11,536,156		278,428			—		11,814,584
Food, Beverage & Tobacco		7,718,716		9,533,429			—		17,252,145
Pharmaceuticals, Biotechnology & Life Sciences		3,346,860		18,199,546			—		21,546,406
Taiwan1		—		13,568,726			—		13,568,726
Semiconductors & Semiconductor Equipment		6,030,520		5,785,157			—		11,815,677
Thailand1		—		2,298,267			—		2,298,267
Consumer Services		2,105,928		—			—		2,105,928
Media		692,828		—			—		692,828
Real Estate		1,848,037		—			—		1,848,037
Retailing		1,035,579		—			—		1,035,579
Telecommunication Services		2,346,746		—			—		2,346,746
Turkey1		—		3,252,778			—		3,252,778
Transportation		648,194		—			—		648,194
United Kingdom1		—		114,418,998			—		114,418,998
Capital Goods		1,198,376		79,420,481			50,875		80,669,732
Commercial & Professional Supplies		8,255,720		9,264,181			—		17,519,901
Food, Beverage & Tobacco		10,761,361		16,294,477			—		27,055,838
Insurance		11,459,584		15,330,652			—		26,790,236
Materials		4,454,002		41,815,597			—		46,269,599
Pharmaceuticals, Biotechnology & Life Sciences		688,556		8,624,316			—		9,312,872
Real Estate		3,270,279		4,086,112			—		7,356,391
Retailing		3,095,426		7,472,803			—		10,568,229
Software & Services		955,078		5,177,918			—		6,132,996
Technology Hardware & Equipment		7,969,730		27,518,474			—		35,488,204
Telecommunication Services		1,630,483		2,900,359			—		4,530,842
United States1		2,556,631		—			—		2,556,631
Preferred Stock1		—		1,027,492			—		1,027,492
Other Investment Companies1		72,899,443		—			—		72,899,443
Rights
Netherlands		20,734		—			—		20,734

See financial notes 51

 Laudus International MarketMasters Fund

Portfolio Holdings (Unaudited) continued

	Quoted Prices in					Significant
	Active Markets for			Significant Other		Unobservable
	Identical Assets			Observable Inputs		Inputs
Description	(Level 1)			(Level 2)		(Level 3)		Total
Spain		$304			$—		$346,281		$346,585
Short-Term Investments1		—			2,170,789		—		2,170,789
Total		$362,930,629			$1,596,882,465		$423,767		$1,960,236,861
Other Financial Instruments
Futures Contract2		$1,453,144			$—		$—		$1,453,144
Forward Foreign Currency Exchange Contracts2		6,518,708			—		—		6,518,708
Liabilities Valuation Input
Other Financial Instruments
Forward Foreign Currency Exchange Contracts2		($1,634,438	)		$—		$—		($1,634,438	)

1	As categorized in Portfolio Holdings.
2	Futures contracts and forward foreign currency exchange contracts are not included in Investments and are valued at unrealized appreciation or depreciation.

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Balance							Change in												Balance
	as of		Accrued		Realized			Unrealized								Gross		Gross		as of
	October 31,		Discounts		Gains			Gains			Gross		Gross			Transfers		Transfers		April 30,
Investments in Securities	2012		(Premiums)		(Losses)			(Losses)			Purchases		Sales			in		out		2013
Common Stock
Hong Kong		$30,640		$—		$—			($18,400	)		$—		$—			$—		$—		$12,240
Spain		—		—		—			1,320			13,051		—			—		—		14,371
United Kingdom		—		—		—			955			49,920		—			—		—		50,875
Preferred Stock
United Kingdom		32,214		—		296			(377	)		—		(32,133	)		—		—		—
Rights
Spain		—		—		—			21,300			324,981		—			—		—		346,281
Corporate Bonds
Brazil		28,510		89		(3,908	)		88,682			—		(113,373	)		—		—		—
Total		$91,364		$89		($3,612	)		$93,480			$387,952		($145,506	)		$—		$—		$423,767

All net realized and change in unrealized gains (losses) in the table above are reflected on the accompanying Statement of Operations. The change in net unrealized gains (losses) for Level 3 investments held by the fund at April 30, 2013 was ($26,778).

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were security transfers in the amount of $9,459,236 and $22,647,351 from Level 1 to Level 2 and from Level 2 to Level 1, respectively, for the period ended April 30, 2013. The transfers between Level 1 and Level 2 were primarily due to the use of international fair valuation by the fund. There were no transfers in or out of Level 3 securities during the period.

52 See financial notes

 Laudus International MarketMasters Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments, at value (cost $1,520,199,079)		$1,960,236,861
Foreign currency, at value (cost $1,888,613)		1,907,987
Receivables:
Investments sold		14,495,798
Dividends		7,346,616
Fund shares sold		3,234,578
Foreign tax reclaims		1,130,985
Due from broker for futures		31,740
Interest		744
Unrealized gains on forward foreign currency exchange contracts		6,518,708
Prepaid expenses	+	120,691
Total assets		1,995,024,708
Liabilities
Payables:
Investments bought		16,548,178
Investment adviser and administrator fees		178,938
Shareholder service fees		343,581
Fund shares redeemed		1,104,039
Foreign capital gains tax		22,978
Unrealized losses on forward foreign currency exchange contracts	+	1,634,438
Total liabilities		19,832,152
Net Assets
Total assets		1,995,024,708
Total liabilities	−	19,832,152
Net assets		$1,975,192,556
Net Assets by Source
Capital received from investors		1,851,818,839
Distributions in excess of net investment income		(8,328,366	)
Net realized capital losses		(314,669,291	)
Net unrealized capital gains		446,371,374
Net Asset Value (NAV) by Shares Class

			Shares
Share Class	Net Assets	÷	Outstanding	=	NAV
Investor Shares	$648,160,599		29,862,749			$21.70
Select Shares	$1,327,031,957		61,176,111			$21.69

See financial notes 53

 Laudus International MarketMasters Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends (net of foreign withholding taxes of $1,365,575)		$21,363,269
Interest (net of foreign withholding taxes of $431)	+	57,435
Total investment income		21,420,704
Expenses
Investment adviser and administrator fees		11,277,276
Shareholder service fees:
Investor Shares		736,895
Select Shares		469,832
Custodian fees		530,377
Transfer agent fees		93,782
Portfolio accounting fees		89,961
Shareholder reports		54,850
Professional fees		54,180
Registration fees		28,445
Trustees’ fees		7,957
Interest expense		116
Other expenses	+	32,023
Total expenses		13,375,694
Expense reduction by CSIM and its affiliates	−	1,798,237
Custody credits	−	4
Net expenses	−	11,577,453
Net investment income		9,843,251
Realized and Unrealized Gains (Losses)
Net realized gains on investments		80,094,069
Net realized gains on futures contracts		2,480,592
Net realized gains on foreign currency transactions	+	1,081,676
Net realized gains		83,656,337
Net unrealized gains on investments (net of foreign capital gain tax of ($22,978))		176,792,147
Net unrealized gains on futures contracts		2,046,562
Net unrealized gains on foreign currency translations	+	3,557,034
Net unrealized gains	+	182,395,743
Net realized and unrealized gains		266,052,080
Increase in net assets resulting from operations		$275,895,331

54 See financial notes

 Laudus International MarketMasters Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$9,843,251			$20,817,525
Net realized gains		83,656,337			16,733,565
Net unrealized gains	+	182,395,743			114,959,645
Increase in net assets from operations		275,895,331			152,510,735
Distributions to Shareholders
Distributions from net investment income
Investor Shares		(13,288,779	)		(5,407,664	)
Select Shares	+	(25,873,436	)		(9,563,990	)
Total distributions from net investment income		($39,162,215	)		($14,971,654	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares Sold
Investor Shares			1,686,262		$34,182,019			1,866,086		$33,699,589
Select Shares	+		8,868,687		180,268,016			14,627,352		259,539,496
Total shares sold			10,554,949		$214,450,035			16,493,438		$293,239,085
Shares Reinvested
Investor Shares			634,180		$12,214,309			313,230		$4,983,484
Select Shares	+		892,608		17,173,788			403,057		6,404,578
Total shares reinvested			1,526,788		$29,388,097			716,287		$11,388,062
Shares Redeemed
Investor Shares			(3,546,096	)	($71,570,511	)		(9,205,299	)	($164,437,304	)
Select Shares	+		(4,388,632	)	(87,468,741	)		(14,236,435	)	(249,904,027	)
Total shares redeemed			(7,934,728	)	($159,039,252	)		(23,441,734	)	($414,341,331	)
Net transactions in fund shares			4,147,009		$84,798,880			(6,232,009	)	($109,714,184	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			86,891,851		$1,653,660,560			93,123,860		$1,625,835,663
Total increase or decrease	+		4,147,009		321,531,996			(6,232,009	)	27,824,897
End of period			91,038,860		$1,975,192,556			86,891,851		$1,653,660,560
(Distributions in excess of net investment income)/Net investment income not yet distributed					($8,328,366	)				$20,990,598

See financial notes 55

 Laudus MarketMasters Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds discussed in this report is a series of Schwab Capital Trust (the “trust”), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trust as of the end of the period, including the funds discussed in this report, which are highlighted:

Schwab Capital Trust (organized May 7, 1993)	Schwab International Core Equity Fund
Laudus Small-Cap MarketMasters Fund	Schwab Target 2010 Fund
Laudus International MarketMasters Fund	Schwab Target 2015 Fund
Schwab S&P 500 Index Fund	Schwab Target 2020 Fund
Schwab Small-Cap Index Fund	Schwab Target 2025 Fund
Schwab Total Stock Market Index Fund	Schwab Target 2030 Fund
Schwab International Index Fund	Schwab Target 2035 Fund
Schwab MarketTrack All Equity Portfolio	Schwab Target 2040 Fund
Schwab MarketTrack Growth Portfolio	Schwab Target 2045 Fund
Schwab MarketTrack Balanced Portfolio	Schwab Target 2050 Fund
Schwab MarketTrack Conservative Portfolio	Schwab Target 2055 Fund
Schwab Balanced Fund	Schwab Fundamental US Large Company Index Fund
Schwab Core Equity Fund	Schwab Fundamental US Small Company Index Fund
Schwab Dividend Equity Fund	Schwab Fundamental International Large Company Index Fund
Schwab Large-Cap Growth Fund	Schwab Fundamental International Small Company Index Fund
Schwab Small-Cap Equity Fund	Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab Hedged Equity Fund	Schwab Monthly Income Fund - Moderate Payout
Schwab Financial Services Fund	Schwab Monthly Income Fund - Enhanced Payout
Schwab Health Care Fund	Schwab Monthly Income Fund - Maximum Payout

Each of the Laudus MarketMasters Funds offers two share classes: Investor Shares and Select Shares^®. Shares of each class represent an interest in the same portfolio, but each class has different expenses and investment minimums.

Shares are bought and sold (subject to a redemption fee, see financial note 9) at closing net asset value per share (“NAV”), which is the price for all outstanding shares of a fund or share class, as applicable. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the “Board”) may authorize the issuance of as many shares as necessary.

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 may also keep certain assets in segregated accounts, as required by securities law.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

(a) Security Valuation:

Under procedures approved by the Board, the investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

The funds value the securities in their portfolios every business day. The funds use the following policies to value various types of securities:

•  Securities traded on an exchange or over-the-counter: Traded securities are valued at the closing value for the day, or, on days when no closing value has been reported, at halfway between the most recent bid and ask quotes. Securities that are primarily traded on foreign exchanges are valued at the official closing price or the last sales price on the exchange where the securities are principally traded with these values then translated into U.S. dollars at the current exchange rate, unless these securities are fair valued as discussed below.

•  Securities for which no quoted value is available: The Board has adopted procedures to fair value each fund’s securities when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a

56 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

price; or when a security’s primary trading market is closed during regular market hours. Each fund makes fair value determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ techniques such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing Committee regularly reviews these inputs and assumptions to calibrate the valuations. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security. The Board convenes on a regular basis to review fair value determinations made by the funds pursuant to the valuation procedures.

•  Foreign equity security fair valuation: The Board has adopted procedures to fair value foreign equity securities that are traded in markets that close prior to the funds valuing their holdings. By fair valuing securities whose prices may have been affected by events occurring after the close of trading, each fund seeks to establish prices that investors might expect to realize upon the current sales of these securities. This methodology is designed to deter “arbitrage” market timers, who seek to exploit delays between the change in the value of a fund’s portfolio holdings and the net asset value of the fund’s shares, and seeks to help ensure that the prices at which the fund’s shares are purchased and redeemed are fair and do not result in dilution of shareholder interest or other harm to shareholders. When fair value pricing is used at the open or close of a reporting period, it may cause a temporary divergence between the return of a fund and that of its comparative index or benchmark. The Board regularly reviews fair value determinations made by the funds pursuant to these procedures.

•  Futures and forward foreign currency exchange contracts: Futures and forwards are valued at their settlement prices as of the close of their exchanges (for futures) or at a value based on that day’s forward exchange rates (for forwards).

•  Short-term securities (60 days or less to maturity): Short-term securities are valued at amortized cost, which approximates market value.

•  Underlying funds: Mutual funds are valued at their respective net asset values. Exchange trade funds (ETFs) traded on a recognized securities exchange are valued at the last reported sale price that day or the official closing price, if applicable.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If the funds determine that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

•  Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities and futures contracts. Investments in mutual funds are valued daily at their NAVs, which are classified as Level 1 prices.

•  Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. In addition, international securities whose markets close hours before the funds value their holdings may require fair valuations due to significant movement in the U.S. markets occurring after the daily close of the foreign markets. The Board has approved a vendor that calculates fair valuations of international equity securities based on a number of factors that appear to correlate to the movements in the U.S. markets. As investments whose values are classified as Level 2 prices include positions that are not traded in active markets and/or are subject to

57

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

•  Level 3 — significant unobservable inputs (including the funds’ own assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not available for these securities, the funds use one or more valuation techniques for which sufficient and reliable data is available. The inputs used by the funds in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the funds in the absence of market information. Assumptions used by the funds due to the lack of observable inputs may significantly impact the resulting fair value and therefore the funds’ results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the funds’ investments as of April 30, 2013 are disclosed in the Portfolio Holdings.

(b) Accounting Policies for certain Portfolio Investments (if held):

Futures Contracts: Futures contracts are instruments that represent an agreement between two parties that obligates one party to buy, and the other party to sell, specific instruments at an agreed upon price on a stipulated future date. A fund must give the broker a deposit of cash and/or securities (initial margin) whenever it enters into the futures contract. The amount of the deposit may vary from one contract to another. Subsequent payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized gains or losses until the contract is closed, at which time the gains or losses are realized. Futures are traded publicly on exchanges, and their market value changes daily.

Forward Foreign Currency Exchange Contracts: “Forwards”, as they are known, are contracts to buy and sell a currency at a set price on a future date. The value of the forwards is accounted for as unrealized gains or losses until the contracts settle, at which time the gains or losses are realized.

(c) Security Transactions:

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains or 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 calculated using exchange rates in effect on the transaction date. Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the differences between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains or losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period. These realized and unrealized foreign exchange gains or losses are reported in foreign currency transactions or translations in the Statement of Operations. The funds do not isolate the portion of the fluctuations on investments resulting from changes in foreign currency exchange rates from the fluctuations in market prices of investments held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.

Gains realized by the funds on the sale of securities in certain foreign countries may be subject to non-U.S. taxes. In those instances, the funds record a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.

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 of the contract, and records a realized gain or loss accordingly.

58 

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Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(d) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds 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 received from foreign sources may result in withholding tax. Withholding taxes are accrued at the same time as the related income if the tax rate is fixed and known, unless a tax withheld is reclaimable from the local tax authorities in which case it is recorded as receivable. If the tax rate is not known or estimable, such expense or reclaim receivable is recorded when the net proceeds are received.

(e) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within the trust generally are allocated among the funds in proportion to their average daily net assets.

For funds offering multiple share classes, the net investment income, other than class specific expenses, and the realized and unrealized gains or losses, are allocated daily to each class in proportion to their average daily net assets.

(f) Distributions to Shareholders:

The funds make distributions from net investment income and net realized capital gains, if any, once a year.

(g) Custody Credit:

The funds have an arrangement with their custodian bank, State Street Bank and Trust Company (“State Street”), under which the funds may receive a credit for their uninvested cash balance to offset their custody fees and accounting fees. The credit amounts, if any, are disclosed in the Statement of Operations as a reduction to the funds’ operating expenses.

(h) Accounting Estimates:

The accounting policies described in this report conform to GAAP. 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 and these differences may be material.

(i) Federal Income Taxes:

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.

(j) Foreign Taxes:

The funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, corporate events, foreign currency exchanges and capital gains on investments. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in foreign markets in which the funds invest. These foreign taxes, if any, are paid by the funds and are disclosed in the Statement of Operations. Foreign taxes payable as of April 30, 2013, if any, are reflected in the funds’ Statements of Assets and Liabilities.

(k) Indemnification:

Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.

59

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(l) New Accounting Pronouncements:

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative instruments. Management is currently evaluating the impact the adoption of ASU No. 2011-11 may have on the funds’ financial statement disclosures.

3. Risk Factors:

Investing in the funds may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Stock markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of the investment in a fund will fluctuate, which means that investors could lose money.

The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

The fund’s investment managers attempt to reduce the impact of the performance of any given investment style by investing in both value and growth style stocks. But whenever value stocks fall out of favor with investors, they may underperform growth stocks, and vice versa.

Historically, small-cap stocks have been riskier than large- and mid-cap stocks, and their prices may move sharply, especially during market upturns and downturns. Small-cap companies may be more vulnerable to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall behind other types of investments — large-cap and mid-cap stocks, for instance — a fund’s small-cap holdings could reduce performance.

Both large- and mid-cap stocks tend to go in and out of favor based on market and economic conditions. However, stocks of mid-cap companies tend to be more vulnerable to adverse business or economic events than larger, more established companies. During a period when large- and mid-cap U.S. stocks fall behind other types of investments — small-cap stocks, for instance — a fund’s large- and mid-cap holdings could reduce performance.

As with all actively managed funds, the strategies of the fund’s managers — its investment adviser and investment managers — may not achieve their desired results.

A fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs.

Emerging markets may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Such countries often have less uniformity in accounting and reporting requirements and unreliable securities valuation and greater risk associated with the custody of securities. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in other countries. As a result, there will tend to be an increased risk of price volatility associated with a fund’s investments in emerging market countries.

As a result of the fund’s investments in securities denominated in, and/or receiving revenues in, foreign currencies, the fund will be subject to currency risk. This is the risk that those currencies will decline in value relative to the U.S. dollar. If such an event occurs, the dollar value of an investment in the fund would be adversely affected.

A fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. Certain of these risks, such as liquidity risk and market risk, are discussed elsewhere in this section. A fund’s use of derivatives is also subject to credit risk, leverage risk, lack of availability risk, valuation risk, correlation risk and tax risk. Lack of availability risk is the risk that suitable derivative transactions may not be available in all circumstances for risk management or other purposes. Credit risk is the risk that the counterparty to a derivatives transaction may not fulfill its obligations. Leverage risk is the risk that a small percentage of assets invested in derivatives can have a

60 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

disproportionately larger impact on a fund. Valuation risk is the risk that a particular derivative may be valued incorrectly. Correlation risk is the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate or index. Tax risk is the risk that the use of derivatives may cause the fund to realize higher amounts of short-term capital gain. These risks could cause a fund to lose more than the principal amount invested.

Although CSIM monitors and seeks to coordinate the overall management of a fund, each investment manager makes investment decisions independently, and it is possible that the investment styles of the investment managers may not complement one another. As a result, a fund’s exposure to a given stock, industry or investment style could unintentionally be smaller or larger than if a fund had a single manager.

A particular investment may be difficult to purchase or sell. A fund may be unable to sell illiquid securities at an advantageous time or price.

Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.

4. Affiliates and Affiliated Transactions:

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement (“Advisory Agreement”) between CSIM and the trust.

For its advisory and administrative services to the funds, CSIM is entitled to receive an annual fee, payable monthly, based on a percentage of each fund’s average daily net assets as follows:

	Laudus Small-Cap		Laudus International
% of Average Daily Net Assets	MarketMasters Fund		MarketMasters Fund
First $500 million		1.17%		1.29%
$500 million to $1 billion		1.13%		1.275%
Over $1 billion		1.07%		1.25%

The Board has adopted a Shareholder Servicing Plan (the “Plan”) on behalf of the funds. The Plan enables each fund to bear expenses relating to the provision by service providers, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, “Schwab”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds. Schwab serves as the funds’ paying agent under the Plan for making payments of the shareholder service fee due to the service providers (other than Schwab). All shareholder service fees paid by the funds to Schwab in its capacity as the funds’ paying agent will be passed through to the service providers, and Schwab will not retain any portion of such fees.

Pursuant to the Plan, each fund’s shares are subject to an annual shareholder servicing fee up to 0.25% for Investor Shares and 0.20% for Select Shares. The shareholder servicing fee paid to a particular service provider is made pursuant to its written agreement with Schwab (or, in the case of payments made to Schwab, pursuant to Schwab’s written agreement with the funds), and the funds will pay no more than 0.25% for Investor Shares and 0.20% for Select Shares of the average annual daily net asset value of the fund shares owned by shareholders holding shares through such service providers. Payments under the Plan are made as described above regardless of Schwab’s or the service provider’s actual cost of providing the services. If the cost of providing the services under the Plan is less than the payments received, the unexpended portion of the fees may be retained as profit by Schwab or the service provider.

Although these agreements specify certain fees for these services, CSIM and its affiliates have made an additional agreement with the funds, for so long as CSIM serves as the investment adviser to the funds, which may only be amended or terminated with the approval of the Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses (“expense limitation”). The expense limitation as a percentage of average daily net assets is as follows:

	Laudus Small-Cap		Laudus International
	MarketMasters Fund		MarketMasters Fund
Investor Shares		1.35%		1.40%
Select Shares		1.20%		1.25%

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 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Certain Schwab Funds may own shares of other Schwab Funds. The table below reflects the percentage of each fund shares in this report owned by other Schwab Funds as of April 30, 2013:

	Laudus Small-Cap		Laudus International
	MarketMasters Fund		MarketMasters Fund
Schwab Target 2010 Fund		0.6%		0.1%
Schwab Target 2015 Fund		1.0%		0.2%
Schwab Target 2020 Fund		5.8%		1.1%
Schwab Target 2025 Fund		3.6%		0.7%
Schwab Target 2030 Fund		11.2%		2.0%
Schwab Target 2035 Fund		3.4%		0.6%
Schwab Target 2040 Fund		13.2%		2.3%
Schwab Target 2045 Fund		0.1%		0.0%	*
Schwab Target 2050 Fund		0.1%		0.0%	*
Schwab Target 2055 Fund		0.1%		0.0%	*
Schwab Monthly Income Fund - Moderate Payout		—%		0.2%
Schwab Monthly Income Fund - Enhanced Payout		—%		0.4%
Schwab Monthly Income Fund - Maximum Payout		—%		0.2%
Schwab Balanced Fund		8.3%		—%

* Less than 0.05%

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other Schwab Funds. All loans are for temporary or emergency purposes only. The interest rate to be charged on a loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.

5. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted in each fund’s Statement of Operations. For information regarding the trustees please refer to Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The funds have access to custodian overdraft facilities, a committed line of credit of $150 million with State Street, an uncommitted line of credit of $100 million with Bank of America, N.A. and an uncommitted line of credit of $50 million with Brown Brothers Harriman & Co. The funds pay interest on the amounts they borrow at rates that are negotiated periodically. The funds also pay an annual fee to State Street for the committed line of credit.

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2013, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Laudus Small-Cap MarketMasters Fund		$99,378,807		$99,992,041
Laudus International MarketMasters Fund		591,863,459		562,006,278

8. Derivatives:

The funds entered into equity index futures contracts (“futures”) during the report period. The funds invested in futures to equitize available cash. The fair value and due to brokers for futures contracts held at April 30, 2013 are presented on the face of

62 

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

8. Derivatives (continued):

the Portfolio Holdings and Statement of Assets, respectively. The net realized/unrealized gains (losses) on futures contracts are presented on the Statement of Operations. Refer to financial note 2(b) for the funds’ accounting policies with respect to futures contracts and financial note 3 for disclosures concerning the risks of investing in futures contracts. During the period, the month-end average contract values of futures contracts held by the funds and the month-end average number of contracts held were as follows:

	Contract Values		Number of Contracts
Laudus Small-Cap MarketMasters Fund		$2,918,182		33
Laudus International MarketMasters Fund		39,065,751		476

The Laudus International MarketMasters Fund also invested in forward foreign currency exchange contracts (“forwards”) during the report period. The fund invested in forwards in connection with the purchase and sale of portfolio securities to minimize the uncertainty of changes in future foreign currency exchange rates. Refer to financial note 2(b) for the fund’s accounting policies with respect to forwards and financial note 3 for disclosures concerning the risks of investing in forwards. During the period, the month-end average forward foreign currency notional amount and the month-end average unrealized gains (losses) were $157,669,929 and $4,209,926, respectively.

As of April 30, 2013, the derivatives contracts held by the Laudus International MarketMasters Fund, categorized by primary risk exposure, were:

Asset Derivatives	Fair Value
Equity Index - Futures Contracts1		$1,453,144
Forward Foreign Currency Exchange Contracts2		6,518,708
Total		$7,971,852
Liability Derivatives
Forward Foreign Currency Exchange Contracts3		$1,634,438

1	Includes cumulative unrealized gains of futures contracts as reported in the Schedule of Portfolio Holdings. Only current day’s variation margin is reported within the Statement of Assets and Liabilities.
2	Statement of Assets and Liabilities location: Unrealized gains on forward foreign currency exchange contracts.
3	Statement of Assets and Liabilities location: Unrealized losses on forward foreign currency exchange contracts.

During the period ending April 30, 2013, the derivatives held by the Laudus International MarketMasters Fund, categorized by primary risk exposure, were:

	Equity Index		Forward Foreign Currency
	Futures Contracts		Exchange Contracts
Realized Gains (Losses)1		$2,480,592		$1,067,495
Change in Unrealized Gains (Losses)2		2,046,562		3,493,973

1	Statement of Operations location: Net realized gains/losses on futures contracts and net realized gains/losses on foreign currency transactions.
2	Statement of Operations location: Net unrealized gains/losses on futures contracts and net unrealized gains/losses on foreign currency translations.

9. Redemption Fee:

The funds charge a 2.00% redemption fee on shares sold or exchanged within 30 days of the original purchase date. Such amounts are netted against redemption proceeds in the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

	Current Period		Prior Period
	(11/1/12-4/30/13)		(11/1/11-10/31/12)
Laudus Small-Cap MarketMasters Fund		$95		$394
Laudus International MarketMasters Fund		3,031		7,324

63

 Laudus MarketMasters Funds

Financial Notes, unaudited (continued)

10. Federal Income Taxes:

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of October 31, 2012, the funds had capital loss carryforwards available to offset future net capital gains before the expiration dates as follows:

	Laudus Small-Cap		Laudus International
Expiration Date	MarketMasters Fund		MarketMasters Fund
October 31, 2016		$—		$1,774,547
October 31, 2017		50,679,960		366,649,297
Total		$50,679,960		$368,423,844

For the year ended October 31, 2012, the funds had capital losses deferred and capital losses utilized as follows:

	Laudus Small-Cap		Laudus International
	MarketMasters Fund		MarketMasters Fund
Capital losses deferred		$897,248		$—
Capital losses utilized		12,666,636		2,234,908

As of October 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended October 31, 2012, the funds did not incur any interest or penalties.

11. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

64 

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Capital Trust, which includes the funds covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The Fund Complex includes 94 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the funds’ Statement of Additional Information, which is available free by calling 1-800-435-4000.

 Independent Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Mariann Byerwalter 1960 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman of JDN Corporate Advisory LLC (advisory services firm) (Oct. 2001 – present).	77	Director,WageWorks, Inc. (2010 – present) Director, Redwood Trust, Inc. (1998 – present) Director, PMI Group Inc. (2001 – 2009)
John F. Cogan 1947 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research; Professor of Public Policy, Stanford University (Sept. 2000 – present).	77	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
William A. Hasler 1941 Trustee (Trustee of Schwab Capital Trust since 2000.)	Dean Emeritus, Haas School of Business, University of California, Berkeley (July 1998 – present).	77	Director, TOUSA (1998 – present) Director, Globalstar, Inc. (2009 – present) Director, Aviat Networks (2001 – present) Director, Mission West Properties (1998 – 2012) Director, Ditech Networks Corporation (1997 – 2012) Director, Genitope Corporation (2000 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	77	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Tercica Inc. (2004 – 2008)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – present); Senior Vice President and General Manager of Consumer Group, Intuit, Inc. (June 2007 – Dec. 2008); Senior Vice President and Chief Financial Officer, Intuit, Inc. (Sept. 2005 – Jan. 2008).	77	Director, KLA-Tencor Corporation (2008 – present) Director, BEA Systems, Inc. (2007 – 2008)
Gerald B. Smith 1950 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (1990 – present).	77	Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – present) Director, Oneok, Inc (2009 – present) Lead Independent Director, Board of Cooper Industries (2002 – 2012)

65

 Independent Trustees (continued)

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (Jan. 2008- present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	77	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

 Interested Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served )	During the Past Five Years	the Trustee	Other Directorships
Charles R. Schwab2 1937 Chairman and Trustee (Chairman and Trustee of Schwab Capital Trust since 1993.)	Chairman and Director, The Charles Schwab Corporation, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc., Charles Schwab Bank, N. A.; Chairman and Chief Executive Officer, Schwab (SIS) Holdings Inc. I, Schwab International Holdings, Inc.; Chief Executive Officer, Schwab Holdings, Inc.; Through June 2007, Director, U.S. Trust Company, N. A., U.S. Trust Corporation, United States Trust Company of New York. Until October 2008, Chief Executive Officer, The Charles Schwab Corporation, Charles Schwab & Co., Inc.	77	None
Walter W. Bettinger II2 1960 Trustee (Trustee of Schwab Capital Trust since 2008.)	As of October 2008, President and Chief Executive Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. Since October 2008, Director, The Charles Schwab Corporation. Since May 2008, Director, Charles Schwab & Co., Inc. and Schwab Holdings, Inc. Since 2006, Director, Charles Schwab Bank. Until October 2008, President and Chief Operating Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. From 2004 through 2007, Executive Vice President and President, Schwab Investor Services. From 2004 through 2005, Executive Vice President and Chief Operating Officer, Individual Investor Enterprise, and from 2002 through 2004, Executive Vice President, Corporate Services.	94	None

 Officers of the Trust

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
Marie Chandoha 1961 President and Chief Executive Officer (Officer of Schwab Capital Trust since 2010.)	Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President and Chief Executive Officer (Dec. 2010 – present) and Chief Investment Officer (Dec. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 2007 – August 2010).

66 

 Officers of the Trust (continued)

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
George Pereira 1964 Treasurer and Principal Financial Officer (Officer of Schwab Capital Trust since 2004.)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab Asset Management (Ireland) Limited (April 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 2011 – present); Senior Managing Director, Global Head of Active Fixed-Income Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head of Market-Based Strategies, State Street Research (August 2003 – Jan. 2005).
David Lekich 1964 Secretary and Chief Legal Officer (Officer of Schwab Capital Trust since 2011.)	Senior Vice President (Sept. 2011 – present), Vice President (March 2004 – Sept. 2011), Charles Schwab & Co., Inc.; Senior Vice President and Chief Counsel (Sept. 2011 – present), Vice President (Jan. 2011 – Sept. 2011), Charles Schwab Investment Management, Inc.; Secretary (April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President (Officer of Schwab Capital Trust since 2005.)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant Secretary, Schwab ETFs (Oct. 2009 – present).

1	Trustees remain in office until they resign, retire or are removed by shareholder vote. The Schwab Funds® retirement policy requires that independent trustees elected after January 1, 2000 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the Schwab Funds retirement policy also requires any independent trustee of the Schwab Funds who also serves as an independent trustee of the Laudus Funds to retire from the Boards of the Schwab Funds upon their required retirement date from either the Boards of Trustees of the Schwab Funds or the Laudus Funds, whichever comes first.
2	Mr. Schwab and Mr. Bettinger are Interested Trustees because they are employees of Schwab. In addition to their employment with Schwab, Messrs. Schwab and Bettinger also own stock of The Charles Schwab Corporation, the parent company of Schwab and the investment adviser.
3	The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

67

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.

Barclays U.S. Aggregate Bond Index A broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-back securities (agency fixed-rate and hybrid ARM passthroughs), asset-backed securities, and commercial mortgage-backed securities.

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.”

An individual bond is subject to the credit risk of the issuer. Changes in interest rates can affect a bond’s market value prior to call or maturity. There is no guarantee that a bond’s yield to call or maturity will provide a positive return over the rate of inflation.

bond fund A bond fund is subject to the same credit, interest rate, and inflation risks as bonds. In addition, a bond fund incurs ongoing fees and expenses. A bond fund’s net asset value will fluctuate with the price of the underlying bonds and the portfolio turnover activity; return of principal is not guaranteed.

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.

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.

MSCI EAFE Index A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada.

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.

Russell 2000 Index An index that measures the performance of the small-cap segment of the U.S. equity universe.

S&P 500 Index A market capitalization index that is designed to measure the performance of 500 leading publicly held companies in leading industries of the U.S. economy.

stock A share of ownership, or equity, in the issuing company.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

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.

68 

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting the Laudus Funds’ website at www.laudus.com/prospectus, the SEC’s website at http://www.sec.gov, or by contacting Laudus Funds at 1-800-447-3332.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.laudus.com/prospectus or the SEC’s website at http://www.sec.gov.

The Laudus Funds^tm

Laudus Growth Investors

Laudus Growth Investors U.S. Large Cap Growth Fund

Laudus MarketMasters Funds^tm

Laudus International MarketMasters Fund^tm

Laudus Small-Cap MarketMasters Fund^tm

Laudus Mondrian Funds^tm

Laudus Mondrian International Equity Fund

Laudus Mondrian Emerging Markets Fund

Laudus Mondrian International Fixed Income Fund

Laudus Mondrian Global Fixed Income Fund

Laudus Mondrian Institutional Funds^tm

Laudus Mondrian Institutional Emerging Markets Fund

Laudus Mondrian Institutional International Equity Fund

The Laudus Funds include the Laudus Growth Investors U.S. Large Cap Growth Fund and the Laudus Mondrian Funds, which are part of the Laudus Trust and Laudus Institutional Trust and distributed by ALPS Distributors Inc.; and the Laudus MarketMasters Funds, which are part of the Schwab Capital Trust, and distributed by Charles Schwab & Co., Inc. Charles Schwab & Co., Inc. and ALPS Distributors Inc. are unaffiliated entities.

For More Information about the Funds:

Investment Adviser

Charles Schwab Investment Management, Inc.

211 Main Street, San Francisco, CA 94105

Funds

Laudus MarketMasters Funds

P.O. Box 3812, Englewood, CO 80155–3812

This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.

^© 2013 Charles Schwab & Co., Inc. All rights reserved. Member SIPC^®. Printed on recycled paper. MFR13563-16
00098633

COMMAND PERFORMANCE^TM

Semiannual report dated April 30, 2013, enclosed.

Schwab Target Funds

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

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This wrapper is not part of the shareholder report.

Schwab Target Funds

Semiannual Report

April 30, 2013

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

Schwab Target Funds

In This Report

Performance at a Glance	3
From the President	6
Fund Management	8
Performance and Fund Facts
Schwab Target 2010 Fund	9
Schwab Target 2015 Fund	10
Schwab Target 2020 Fund	11
Schwab Target 2025 Fund	12
Schwab Target 2030 Fund	13
Schwab Target 2035 Fund	14
Schwab Target 2040 Fund	15
Schwab Target 2045 Fund	16
Schwab Target 2050 Fund	17
Schwab Target 2055 Fund	18
Fund Expenses	19
Financial Statements and Portfolio Holdings
Schwab Target 2010 Fund	20
Schwab Target 2015 Fund	26
Schwab Target 2020 Fund	32
Schwab Target 2025 Fund	38
Schwab Target 2030 Fund	44
Schwab Target 2035 Fund	50
Schwab Target 2040 Fund	56
Schwab Target 2045 Fund	62
Schwab Target 2050 Fund	68
Schwab Target 2055 Fund	74
Financial Notes	80
Investment Advisory Agreement Approval	98
Trustees and Officers	100
Glossary	103

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM).
Distributor: Charles Schwab & Co., Inc. (Schwab).

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 20131
Schwab Target 2010 Fund (Ticker Symbol: SWBRX)	6.33%
Target 2010 Composite Index	6.31%
Fund Category: Morningstar Target-Date 2000-2010	5.96%
Performance Details	page 9
Schwab Target 2015 Fund (Ticker Symbol: SWGRX)	7.57%
Target 2015 Composite Index	7.48%
Fund Category: Morningstar Target-Date 2011-2015	7.00%
Performance Details	page 10
Schwab Target 2020 Fund (Ticker Symbol: SWCRX)	9.38%
Target 2020 Composite Index	9.37%
Fund Category: Morningstar Target-Date 2016-2020	7.82%
Performance Details	page 11
Schwab Target 2025 Fund (Ticker Symbol: SWHRX)	10.71%
Target 2025 Composite Index	10.79%
Fund Category: Morningstar Target-Date 2021-2025	9.46%
Performance Details	page 12

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

The components that make up each of the following composite indices may vary over time.

The Target 2010 Composite Index is a custom blended index developed by CSIM based on the 2010 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 27.7% Dow Jones U.S. Total Stock Market Index, 8.7% MSCI EAFE Index, 30.1% Barclays U.S. Aggregate Bond Index, 2.0% FTSE EPRA/NAREIT Global Index, 3.5% Barclays U.S. Aggregate Intermediate Bond Index, 0.5% MSCI Emerging Markets Index, 5.6% Barclays U.S. TIPS Index, 1.3% Citigroup Non-U.S. Dollar World Government Bond Index, 14.2% Barclays U.S. Government/Credit: 1-5 Years, and 6.4% Barclays U.S. Treasury Bills: 1-3 Months.

The Target 2015 Composite Index is a custom blended index developed by CSIM based on the 2015 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 33.0% Dow Jones U.S. Total Stock Market Index, 10.5% MSCI EAFE Index, 27.5% Barclays U.S. Aggregate Bond Index, 2.3% FTSE EPRA/NAREIT Global Index, 3.6% Barclays U.S. Aggregate Intermediate Bond Index, 0.6% MSCI Emerging Markets Index, 4.8% Barclays U.S. TIPS Index, 1.6% Citigroup Non-U.S. Dollar World Government Bond Index, 10.8% Barclays U.S. Government/Credit: 1-5 Years, and 5.3% Barclays U.S. Treasury Bills: 1-3 Months.

The Target 2020 Composite Index is a custom blended index developed by CSIM based on the 2020 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 42.1% Dow Jones U.S. Total Stock Market Index, 13.3% MSCI EAFE Index, 22.4% Barclays U.S. Aggregate Bond Index, 3.0% FTSE EPRA/NAREIT Global Index, 3.4% Barclays U.S. Aggregate Intermediate Bond Index, 0.7% MSCI Emerging Markets Index, 3.4% Barclays U.S. TIPS Index, 1.8% Citigroup Non-U.S. Dollar World Government Bond Index, 6.0% Barclays U.S. Government/Credit: 1-5 Years, and 3.9% Barclays U.S. Treasury Bills: 1-3 Months.

The Target 2025 Composite Index is a custom blended index developed by CSIM based on the 2025 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 48.8% Dow Jones U.S. Total Stock Market Index, 15.5% MSCI EAFE Index, 17.9% Barclays U.S. Aggregate Bond Index, 3.4% FTSE EPRA/NAREIT Global Index, 3.0% Barclays U.S. Aggregate Intermediate Bond Index, 0.8% MSCI Emerging Markets Index, 2.5% Barclays U.S. TIPS Index, 1.7% Citigroup Non-U.S. Dollar World Government Bond Index, 3.4% Barclays U.S. Government/Credit: 1-5 Years, and 3.0% Barclays U.S. Treasury Bills: 1-3 Months.

¹ The report period covers the six months beginning November 1, 2012 through April 30, 2013, except where noted.

Schwab Target Funds 3

Performance at a Glance continued

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 20131
Schwab Target 2030 Fund (Ticker Symbol: SWDRX)	11.78%
Target 2030 Composite Index	11.96%
Fund Category: Morningstar Target-Date 2026-2030	10.14%
Performance Details	page 13
Schwab Target 2035 Fund (Ticker Symbol: SWIRX)	12.83%
Target 2035 Composite Index	13.06%
Fund Category: Morningstar Target-Date 2031-2035	11.48%
Performance Details	page 14
Schwab Target 2040 Fund (Ticker Symbol: SWERX)	13.53%
Target 2040 Composite Index	13.85%
Fund Category: Morningstar Target-Date 2036-2040	11.60%
Performance Details	page 15

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

The components that make up each of the following composite indices may vary over time.

The Target 2030 Composite Index is a custom blended index developed by CSIM based on the 2030 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 54.1% Dow Jones U.S. Total Stock Market Index, 17.2% MSCI EAFE Index, 13.8% Barclays U.S. Aggregate Bond Index, 3.8% FTSE EPRA/ NAREIT Global Index, 2.5% Barclays U.S. Aggregate Intermediate Bond Index, 0.9% MSCI Emerging Markets Index, 1.8% Barclays U.S. TIPS Index, 1.5% Citigroup Non-U.S. Dollar World Government Bond Index, 1.8% Barclays U.S. Government/Credit: 1-5 Years, and 2.6% Barclays U.S. Treasury Bills: 1-3 Months.

The Target 2035 Composite Index is a custom blended index developed by CSIM based on the 2035 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 59.2% Dow Jones U.S. Total Stock Market Index, 18.7% MSCI EAFE Index, 9.8% Barclays U.S. Aggregate Bond Index, 4.2% FTSE EPRA/NAREIT Global Index, 1.8% Barclays U.S. Aggregate Intermediate Bond Index, 1.0% MSCI Emerging Markets Index, 1.2% Barclays U.S. TIPS Index, 1.1% Citigroup Non-U.S. Dollar World Government Bond Index, 0.8% Barclays U.S. Government/Credit: 1-5 Years, and 2.2% Barclays U.S. Treasury Bills: 1-3 Months.

The Target 2040 Composite Index is a custom blended index developed by CSIM based on the 2040 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 62.8% Dow Jones U.S. Total Stock Market Index, 19.9% MSCI EAFE Index, 6.6% Barclays U.S. Aggregate Bond Index, 4.4% FTSE EPRA/NAREIT Global Index, 1.3% Barclays U.S. Aggregate Intermediate Bond Index, 1.0% MSCI Emerging Markets Index, 0.8% Barclays U.S. TIPS Index, 0.8% Citigroup Non-U.S. Dollar World Government Bond Index, 0.3% Barclays U.S. Government/Credit: 1-5 Years, and 2.1% Barclays U.S. Treasury Bills: 1-3 Months.

¹ The report period covers the six months beginning November 1, 2012 through April 30, 2013, except where noted.

4 Schwab Target Funds

Performance at a Glance continued

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 20131
Schwab Target 2045 Fund2 (Ticker Symbol: SWMRX)	6.00%
Target 2045 Composite Index	6.82%
Fund Category: Morningstar Target-Date 2041-2045	5.15%
Performance Details	page 16
Schwab Target 2050 Fund2 (Ticker Symbol: SWNRX)	6.10%
Target 2050 Composite Index	6.99%
Fund Category: Morningstar Target-Date 2046-2050	5.08%
Performance Details	page 17
Schwab Target 2055 Fund2 (Ticker Symbol: SWORX)	6.20%
Target 2055 Composite Index	7.09%
Fund Category: Morningstar Target-Date 2051-2055	5.42%
Performance Details	page 18

Minimum Initial Investment³ $ 100

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

The components that make up each of the following composite indices may vary over time.

The Target 2045 Composite Index is a custom blended index developed by CSIM based on the 2045 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 64.9% Dow Jones U.S. Total Stock Market Index, 20.5% MSCI EAFE Index, 4.9% Barclays U.S. Aggregate Bond Index, 4.5% FTSE EPRA/NAREIT Global Index, 0.9% Barclays U.S. Aggregate Intermediate Bond Index, 1.1% MSCI Emerging Markets Index, 0.5% Barclays U.S. TIPS Index, 0.6% Citigroup Non-U.S. Dollar World Government Bond Index, 0.1% Barclays U.S. Government/Credit: 1-5 Years, and 2.0% Barclays U.S. Treasury Bills: 1-3 Months.

The Target 2050 Composite Index is a custom blended index developed by CSIM based on the 2050 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 66.6% Dow Jones U.S. Total Stock Market Index, 21.1% MSCI EAFE Index, 3.2% Barclays U.S. Aggregate Bond Index, 4.7% FTSE EPRA/NAREIT Global Index, 0.6% Barclays U.S. Aggregate Intermediate Bond Index, 1.1% MSCI Emerging Markets Index, 0.3% Barclays U.S. TIPS Index, 0.4% Citigroup Non-U.S. Dollar World Government Bond Index, and 2.0% Barclays U.S. Treasury Bills: 1-3 Months.

The Target 2055 Composite Index is a custom blended index developed by CSIM based on the 2055 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 67.7% Dow Jones U.S. Total Stock Market Index, 21.4% MSCI EAFE Index, 2.1% Barclays U.S. Aggregate Bond Index, 4.8% FTSE EPRA/NAREIT Global Index, 0.4% Barclays U.S. Aggregate Intermediate Bond Index, 1.1% MSCI Emerging Markets Index, 0.2% Barclays U.S. TIPS Index, 0.3% Citigroup Non-U.S. Dollar World Government Bond Index, and 2.0% Barclays U.S. Treasury Bills: 1-3 Months.

1	The report period covers the six months beginning November 1, 2012 through April 30, 2013, except where noted.
2	Total returns are since the fund’s inception date of January 23, 2013.
3	Please see the funds’ prospectus for further detail and eligibility requirements.

Schwab Target Funds 5

From the President

Marie Chandoha is President and CEO of Charles Schwab Investment Management, Inc. and the funds covered in this report.

Dear Shareholder,

As President and CEO of Charles Schwab Investment Management, Inc., I’d like to thank you for trusting us to help you meet your investment goals, and for reading this important report concerning the Schwab Target Funds. Within each fund is a mix of active, passive, proprietary, and third-party strategies. The funds are professionally managed according to projected retirement dates, and rebalanced to become more conservative as a target date approaches and beyond.

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets, and mixed returns by bonds. The backdrop for these performances included efforts undertaken by the Federal Reserve and many central banks around the world to stimulate faster economic growth by keeping interest rates low. This was particularly the case in Japan, where aggressive central bank policies helped fuel a rally by stocks, while the yen depreciated sharply versus the U.S. dollar. Reduced concerns about the euro zone’s sovereign debt crisis and U.S. fiscal cliff also generally helped equities.

Signs of improvement in the U.S. housing market provided another generally supportive element for stocks, while positively affecting the performance of real estate securities. This collective backdrop helped to hold down returns for bonds. Many major U.S. stock market indices finished at or near record highs, while the MSCI EAFE Index (gross) returned 17.2% and the Dow Jones U.S. Total Stock Market Index returned 15.2%. Among bonds, the Barclays U.S. Aggregate Bond Index returned 0.9%.

 Asset Class Performance Comparison % returns during the report period

This graph compares the performance of various asset classes during the report period. Final performance figures for the period are in the key below.

	14.42%	S&P 500® Index: measures U.S. large-cap stocks
	16.58%	Russell 2000® Index: measures U.S. small-cap stocks
	17.18%	MSCI EAFE® Index (Gross): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	0.90%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.04%	Three-Month U.S. Treasury Bills (T-bills): measures short-term U.S. Treasury obligations

Index figures assume dividends and distributions were reinvested, and do not include trading and management costs, which would lower performance. Indices are unmanaged, do not incur management fees, costs and expenses, and you cannot invest in them directly. Remember that past performance is not an indication of future results.

Data source: Index provider websites and CSIM.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views and portfolio holdings may have changed since the report date.

6 Schwab Target Funds

From the President continued

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets, and mixed returns by bonds.

We also wanted to share some exciting news about our Schwab Target Funds. In January 2013, we enhanced our line-up of target-date options by adding the Target 2045 Fund, Target 2050 Fund, and Target 2055 Fund. We believe that these additions help us offer a full suite of target funds for shareholders.

For more information about the Schwab Target Funds, including the three newest products, please continue reading this report. In addition, you can find answers to frequently asked questions and more details about the funds by visiting www.schwabfunds.com. We are also happy to hear from you at 1-800-435-4000.

Sincerely,

Schwab Target Funds 7

Fund Management

Zifan Tang, CFA, Managing Director and Head of Asset Allocation Strategies, leads the portfolio management team and has overall responsibility for all aspects of the management of the funds. She was appointed portfolio manager of the funds in February 2012. Prior to joining CSIM in 2012, Ms. Tang was a product manager at Thomson Reuters and, from 1997 to 2009, worked as a portfolio manager at Barclays Global Investors, which was subsequently acquired by BlackRock.

8 Schwab Target Funds

Schwab Target 2010 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Target 2010 Fund (7/1/05)		6.33	%		8.38	%		3.67	%		4.62	%
Target 2010 Composite Index3		6.31	%		8.66	%		4.09	%		5.66	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		6.50	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.32	%
Fund Category: Morningstar Target-Date 2000-2010		5.96	%		8.14	%		3.88	%		4.73	%

Fund Expense Ratios⁴: Net 0.55%; Gross 0.73%

 Statistics

Number of Holdings	23
Portfolio Turnover Rate5	11%

 Asset Class Weightings % of Investments⁶

Fixed-Income Funds – Intermediate-Term Bond	33.0%
Equity Funds – Large-Cap	23.3%
Fixed-Income Funds – Short-Term Bond	14.7%
Equity Funds – International	9.3%
Fixed Income Funds – Inflation-Protected Bond	5.4%
Equity Funds – Small-Cap	5.3%
Money Market Funds	3.3%
Short-Term Investments	3.1%
Equity Funds – Global Real Estate	2.1%
Fixed-Income Funds – International Bond	0.5%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Schwab Total Bond Market Fund	20.6%
Schwab Short-Term Bond Market Fund	14.6%
PIMCO Total Return Fund, Institutional Shares	6.5%
Laudus Growth Investors U.S. Large Cap Growth Fund	6.2%
Schwab Core Equity Fund	5.5%
Schwab Treasury Inflation Protected Securities Index Fund	5.4%
Schwab S&P 500 Index Fund	5.3%
Laudus International MarketMasters Fund, Select Shares	4.0%
Schwab Small-Cap Equity Fund	3.5%
TCW Relative Value Large Cap Fund	3.5%
Total	75.1%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2010 Composite Index is a custom blended index developed by CSIM based on the 2010 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 27.7% Dow Jones U.S. Total Stock Market Index, 8.7% MSCI EAFE Index, 30.1% Barclays U.S. Aggregate Bond Index, 2.0% FTSE EPRA/NAREIT Global Index, 3.5% Barclays U.S. Aggregate Intermediate Bond Index, 0.5% MSCI Emerging Markets Index, 5.6% Barclays U.S. TIPS Index, 1.3% Citigroup Non-U.S. Dollar World Government Bond Index, 14.2% Barclays U.S. Government/Credit: 1-5 Years, and 6.4% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.55%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 9

Schwab Target 2015 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Target 2015 Fund (3/12/08)		7.57	%		9.54	%		4.66	%		5.10	%
Target 2015 Composite Index3		7.48	%		9.93	%		4.36	%		5.07	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		6.75	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.86	%
Fund Category: Morningstar Target-Date 2011-2015		7.00	%		9.33	%		3.63	%		4.34	%

Fund Expense Ratios⁴: Net 0.61%; Gross 0.80%

 Statistics

Number of Holdings	23
Portfolio Turnover Rate5	8%

 Asset Class Weightings % of Investments⁶

Fixed-Income Funds – Intermediate-Term Bond	31.0%
Equity Funds – Large-Cap	27.5%
Equity Funds – International	11.1%
Fixed-Income Funds – Short-Term Bond	11.1%
Equity Funds – Small-Cap	6.3%
Fixed Income Funds – Inflation-Protected Bond	4.3%
Short-Term Investments	4.3%
Equity Funds – Global Real Estate	2.6%
Fixed-Income Funds – International Bond	0.9%
Money Market Funds	0.9%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Schwab Total Bond Market Fund	17.0%
Schwab Short-Term Bond Market Fund	11.1%
PIMCO Total Return Fund, Institutional Shares	7.6%
Laudus Growth Investors U.S. Large Cap Growth Fund	7.2%
Schwab Core Equity Fund	6.7%
Schwab S&P 500 Index Fund	6.1%
Laudus International MarketMasters Fund, Select Shares	4.7%
Schwab Treasury Inflation Protected Securities Index Fund	4.3%
Schwab Small-Cap Equity Fund	4.2%
TCW Relative Value Large Cap Fund	4.1%
Total	73.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2015 Composite Index is a custom blended index developed by CSIM based on the 2015 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 33.0% Dow Jones U.S. Total Stock Market Index, 10.5% MSCI EAFE Index, 27.5% Barclays U.S. Aggregate Bond Index, 2.3% FTSE EPRA/NAREIT Global Index, 3.6% Barclays U.S. Aggregate Intermediate Bond Index, 0.6% MSCI Emerging Markets Index, 4.8% Barclays U.S. TIPS Index, 1.6% Citigroup Non-U.S. Dollar World Government Bond Index, 10.8% Barclays U.S. Government/Credit: 1-5 Years, and 5.3% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.61%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

10 Schwab Target Funds

Schwab Target 2020 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Target 2020 Fund (7/1/05)		9.38	%		11.34	%		5.21	%		5.73	%
Target 2020 Composite Index3		9.37	%		11.96	%		4.79	%		6.21	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		6.50	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.32	%
Fund Category: Morningstar Target-Date 2016-2020		7.82	%		10.00	%		3.74	%		4.70	%

Fund Expense Ratios⁴: Net 0.67%; Gross 0.73%

 Statistics

Number of Holdings	22
Portfolio Turnover Rate5	10%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	34.8%
Fixed-Income Funds – Intermediate-Term Bond	25.5%
Equity Funds – International	14.2%
Equity Funds – Small-Cap	8.1%
Fixed-Income Funds – Short-Term Bond	6.3%
Equity Funds – Global Real Estate	3.2%
Fixed Income Funds – Inflation-Protected Bond	3.0%
Short-Term Investments	3.7%
Fixed-Income Funds – International Bond	1.2%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Schwab Total Bond Market Fund	11.4%
Laudus Growth Investors U.S. Large Cap Growth Fund	9.2%
Schwab Core Equity Fund	8.6%
Schwab S&P 500 Index Fund	7.8%
PIMCO Total Return Fund, Institutional Shares	7.7%
Schwab Short-Term Bond Market Fund	6.3%
Laudus International MarketMasters Fund, Select Shares	5.8%
Schwab Small-Cap Equity Fund	5.4%
TCW Relative Value Large Cap Fund	5.0%
Schwab Dividend Equity Fund	4.1%
Total	71.3%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2020 Composite Index is a custom blended index developed by CSIM based on the 2020 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 42.1% Dow Jones U.S. Total Stock Market Index, 13.3% MSCI EAFE Index, 22.4% Barclays U.S. Aggregate Bond Index, 3.0% FTSE EPRA/NAREIT Global Index, 3.4% Barclays U.S. Aggregate Intermediate Bond Index, 0.7% MSCI Emerging Markets Index, 3.4% Barclays U.S. TIPS Index, 1.8% Citigroup Non-U.S. Dollar World Government Bond Index, 6.0% Barclays U.S. Government/Credit: 1-5 Years, and 3.9% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.67%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 11

Schwab Target 2025 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Target 2025 Fund (3/12/08)		10.71	%		12.53	%		6.09	%		6.67	%
Target 2025 Composite Index3		10.79	%		13.39	%		5.00	%		5.79	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		6.75	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.86	%
Fund Category: Morningstar Target-Date 2021-2025		9.46	%		11.43	%		3.56	%		4.49	%

Fund Expense Ratios⁴: Net 0.72%; Gross 0.82%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate5	8%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	40.2%
Fixed-Income Funds – Intermediate-Term Bond	20.6%
Equity Funds – International	16.4%
Equity Funds – Small-Cap	9.4%
Fixed-Income Funds – Short-Term Bond	3.7%
Equity Funds – Global Real Estate	3.7%
Short-Term Investments	2.8%
Fixed Income Funds – Inflation-Protected Bond	2.2%
Fixed-Income Funds – International Bond	1.0%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Laudus Growth Investors U.S. Large Cap Growth Fund	10.6%
Schwab Core Equity Fund	10.3%
Schwab S&P 500 Index Fund	8.7%
Schwab Total Bond Market Fund	7.6%
PIMCO Total Return Fund, Institutional Shares	7.1%
Laudus International MarketMasters Fund, Select Shares	6.7%
Schwab Small-Cap Equity Fund	6.3%
TCW Relative Value Large Cap Fund	5.7%
Schwab Dividend Equity Fund	4.8%
Schwab Short-Term Bond Market Fund	3.7%
Total	71.5%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2025 Composite Index is a custom blended index developed by CSIM based on the 2025 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 48.8% Dow Jones U.S. Total Stock Market Index, 15.5% MSCI EAFE Index, 17.9% Barclays U.S. Aggregate Bond Index, 3.4% FTSE EPRA/NAREIT Global Index, 3.0% Barclays U.S. Aggregate Intermediate Bond Index, 0.8% MSCI Emerging Markets Index, 2.5% Barclays U.S. TIPS Index, 1.7% Citigroup Non-U.S. Dollar World Government Bond Index, 3.4% Barclays U.S. Government/Credit: 1-5 Years, and 3.0% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.72%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

12 Schwab Target Funds

Schwab Target 2030 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Target 2030 Fund (7/1/05)		11.78	%		13.51	%		5.84	%		6.28	%
Target 2030 Composite Index3		11.96	%		14.51	%		5.06	%		6.48	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		6.50	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.32	%
Fund Category: Morningstar Target-Date 2026-2030		10.14	%		11.91	%		3.38	%		4.68	%

Fund Expense Ratios⁴: Net 0.75%; Gross 0.80%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate5	7%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	44.4%
Equity Funds – International	18.2%
Fixed-Income Funds – Intermediate-Term Bond	15.9%
Equity Funds – Small-Cap	10.5%
Equity Funds – Global Real Estate	4.0%
Short-Term Investments	2.4%
Fixed-Income Funds – Short-Term Bond	1.9%
Fixed-Income Funds – Inflation-Protected Bond	1.6%
Fixed-Income Funds – International Bond	1.1%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Laudus Growth Investors U.S. Large Cap Growth Fund	11.6%
Schwab Core Equity Fund	11.2%
Schwab S&P 500 Index Fund	10.0%
Laudus International MarketMasters Fund, Select Shares	7.4%
Schwab Small-Cap Equity Fund	6.9%
TCW Relative Value Large Cap Fund	6.2%
Schwab Total Bond Market Fund	5.8%
PIMCO Total Return Fund, Institutional Shares	5.6%
Schwab Dividend Equity Fund	5.3%
Schwab Global Real Estate Fund	4.0%
Total	74.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2030 Composite Index is a custom blended index developed by CSIM based on the 2030 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 54.1% Dow Jones U.S. Total Stock Market Index, 17.2% MSCI EAFE Index, 13.8% Barclays U.S. Aggregate Bond Index, 3.8% FTSE EPRA/ NAREIT Global Index, 2.5% Barclays U.S. Aggregate Intermediate Bond Index, 0.9% MSCI Emerging Markets Index, 1.8% Barclays U.S. TIPS Index, 1.5% Citigroup Non-U.S. Dollar World Government Bond Index, 1.8% Barclays U.S. Government/Credit: 1-5 Years, and 2.6% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.75%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 13

Schwab Target 2035 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Target 2035 Fund (3/12/08)		12.83	%		14.40	%		6.27	%		6.84	%
Target 2035 Composite Index3		13.06	%		15.56	%		5.12	%		5.99	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		6.75	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.86	%
Fund Category: Morningstar Target-Date 2031-2035		11.48	%		13.02	%		3.34	%		4.43	%

Fund Expense Ratios⁴: Net 0.79%; Gross 0.92%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate5	4%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	48.4%
Equity Funds – International	19.9%
Equity Funds – Small-Cap	11.5%
Fixed-Income Funds – Intermediate-Term Bond	11.2%
Equity Funds – Global Real Estate	4.4%
Short-Term Investments	2.1%
Fixed-Income Funds – Inflation-Protected Bond	1.0%
Fixed-Income Funds – Short-Term Bond	0.9%
Fixed-Income Funds – International Bond	0.6%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Laudus Growth Investors U.S. Large Cap Growth Fund	12.6%
Schwab Core Equity Fund	12.5%
Schwab S&P 500 Index Fund	10.6%
Laudus International MarketMasters Fund, Select Shares	8.0%
Schwab Small-Cap Equity Fund	7.6%
TCW Relative Value Large Cap Fund	6.8%
Schwab Dividend Equity Fund	5.9%
Schwab Global Real Estate Fund	4.4%
PIMCO Total Return Fund, Institutional Shares	4.4%
William Blair International Small Cap Growth Fund, Institutional Shares	3.9%
Total	76.7%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2035 Composite Index is a custom blended index developed by CSIM based on the 2035 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 59.2% Dow Jones U.S. Total Stock Market Index, 18.7% MSCI EAFE Index, 9.8% Barclays U.S. Aggregate Bond Index, 4.2% FTSE EPRA/NAREIT Global Index, 1.8% Barclays U.S. Aggregate Intermediate Bond Index, 1.0% MSCI Emerging Markets Index, 1.2% Barclays U.S. TIPS Index, 1.1% Citigroup Non-U.S. Dollar World Government Bond Index, 0.8% Barclays U.S. Government/Credit: 1-5 Years, and 2.2% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.79%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

14 Schwab Target Funds

Schwab Target 2040 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			Since Inception
Fund: Schwab Target 2040 Fund (7/1/05)		13.53	%		15.08	%		6.07	%		6.63	%
Target 2040 Composite Index3		13.85	%		16.32	%		5.15	%		6.67	%
Dow Jones U.S. Total Stock Market IndexSM		15.16	%		17.15	%		5.81	%		6.50	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.32	%
Fund Category: Morningstar Target-Date 2036-2040		11.60	%		13.00	%		3.23	%		4.83	%

Fund Expense Ratios⁴: Net 0.81%; Gross 0.87%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate5	3%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	51.2%
Equity Funds – International	21.1%
Equity Funds – Small-Cap	12.2%
Fixed-Income Funds – Intermediate-Term Bond	6.9%
Equity Funds – Global Real Estate	4.6%
Short-Term Investments	2.1%
Fixed-Income Funds – Short-Term Bond	0.7%
Fixed-Income Funds – Inflation-Protected Bond	0.7%
Fixed-Income Funds – International Bond	0.5%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Laudus Growth Investors U.S. Large Cap Growth Fund	13.2%
Schwab Core Equity Fund	13.2%
Schwab S&P 500 Index Fund	11.5%
Laudus International MarketMasters Fund, Select Shares	8.5%
Schwab Small-Cap Equity Fund	8.1%
TCW Relative Value Large Cap Fund	7.1%
Schwab Dividend Equity Fund	6.2%
Schwab Global Real Estate Fund	4.6%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.2%
William Blair International Small Cap Growth Fund, Institutional Shares	4.2%
Total	80.8%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2040 Composite Index is a custom blended index developed by CSIM based on the 2040 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 62.8% Dow Jones U.S. Total Stock Market Index, 19.9% MSCI EAFE Index, 6.6% Barclays U.S. Aggregate Bond Index, 4.4% FTSE EPRA/NAREIT Global Index, 1.3% Barclays U.S. Aggregate Intermediate Bond Index, 1.0% MSCI Emerging Markets Index, 0.8% Barclays U.S. TIPS Index, 0.8% Citigroup Non-U.S. Dollar World Government Bond Index, 0.3% Barclays U.S. Government/Credit: 1-5 Years, and 2.1% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.81%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 15

Schwab Target 2045 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Total Returns^1,2

Fund and Inception Date	Since Inception
Fund: Schwab Target 2045 Fund (1/23/13)		6.00	%
Target 2045 Composite Index3		6.82	%
Dow Jones U.S. Total Stock Market IndexSM		7.53	%
Barclays U.S. Aggregate Bond Index		1.07	%
Fund Category: Morningstar Target-Date 2041-2045		5.15	%

Fund Expense Ratios⁴: Net 0.82%; Gross 0.95%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate5	2%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	53.2%
Equity Funds – International	22.0%
Equity Funds – Small-Cap	12.7%
Fixed-Income Funds – Intermediate-Term Bond	5.2%
Equity Funds – Global Real Estate	4.9%
Short-Term Investments	1.2%
Fixed-Income Funds – Short-Term Bond	0.5%
Fixed-Income Funds – Inflation-Protected Bond	0.2%
Fixed-Income Funds – International Bond	0.1%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Schwab Core Equity Fund	13.7%
Laudus Growth Investors U.S. Large Cap Growth Fund	13.6%
Schwab S&P 500 Index Fund	11.6%
Laudus International MarketMasters Fund, Select Shares	8.8%
Schwab Small-Cap Equity Fund	8.3%
TCW Relative Value Large Cap Fund	7.2%
Schwab Dividend Equity Fund	6.5%
Schwab Global Real Estate Fund	4.8%
William Blair International Small Cap Growth Fund, Institutional Shares	4.3%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.2%
Total	83.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2045 Composite Index is a custom blended index developed by CSIM based on the 2045 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 64.9% Dow Jones U.S. Total Stock Market Index, 20.5% MSCI EAFE Index, 4.9% Barclays U.S. Aggregate Bond Index, 4.5% FTSE EPRA/NAREIT Global Index, 0.9% Barclays U.S. Aggregate Intermediate Bond Index, 1.1% MSCI Emerging Markets Index, 0.5% Barclays U.S. TIPS Index, 0.6% Citigroup Non-U.S. Dollar World Government Bond Index, 0.1% Barclays U.S. Government/Credit: 1-5 Years, and 2.0% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.82%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

16 Schwab Target Funds

Schwab Target 2050 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Total Returns^1,2

Fund and Inception Date	Since Inception
Fund: Schwab Target 2050 Fund (1/23/13)		6.10	%
Target 2050 Composite Index3		6.99	%
Dow Jones U.S. Total Stock Market IndexSM		7.53	%
Barclays U.S. Aggregate Bond Index		1.07	%
Fund Category: Morningstar Target-Date 2046-2050		5.08	%

Fund Expense Ratios⁴: Net 0.83%; Gross 0.96%

 Statistics

Number of Holdings	21
Portfolio Turnover Rate5	0%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	54.5%
Equity Funds – International	22.5%
Equity Funds – Small-Cap	13.1%
Equity Funds – Global Real Estate	5.0%
Fixed-Income Funds – Intermediate-Term Bond	3.3%
Short-Term Investments	1.4%
Fixed-Income Funds – Inflation-Protected Bond	0.1%
Fixed-Income Funds – International Bond	0.1%
Fixed-Income Funds – Short-Term Bond	0.0%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Schwab Core Equity Fund	14.1%
Laudus Growth Investors U.S. Large Cap Growth Fund	14.0%
Schwab S&P 500 Index Fund	12.0%
Laudus International MarketMasters Fund, Select Shares	9.0%
Schwab Small-Cap Equity Fund	8.6%
TCW Relative Value Large Cap Fund	7.4%
Schwab Dividend Equity Fund	6.6%
Schwab Global Real Estate Fund	4.9%
William Blair International Small Cap Growth Fund, Institutional Shares	4.4%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.4%
Total	85.4%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2050 Composite Index is a custom blended index developed by CSIM based on the 2050 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 66.6% Dow Jones U.S. Total Stock Market Index, 21.1% MSCI EAFE Index, 3.2% Barclays U.S. Aggregate Bond Index, 4.7% FTSE EPRA/NAREIT Global Index, 0.6% Barclays U.S. Aggregate Intermediate Bond Index, 1.1% MSCI Emerging Markets Index, 0.3% Barclays U.S. TIPS Index, 0.4% Citigroup Non-U.S. Dollar World Government Bond Index, and 2.0% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.83%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized. Less than 1%.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

Schwab Target Funds 17

Schwab Target 2055 Fund

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Total Returns^1,2

Fund and Inception Date	Since Inception
Fund: Schwab Target 2055 Fund (1/23/13)		6.20	%
Target 2055 Composite Index3		7.09	%
Dow Jones U.S. Total Stock Market IndexSM		7.53	%
Barclays U.S. Aggregate Bond Index		1.07	%
Fund Category: Morningstar Target-Date 2051-2055		5.42	%

Fund Expense Ratios⁴: Net 0.83%; Gross 0.96%

 Statistics

Number of Holdings	20
Portfolio Turnover Rate5	0%

 Asset Class Weightings % of Investments⁶

Equity Funds – Large-Cap	55.1%
Equity Funds – International	22.7%
Equity Funds – Small-Cap	13.2%
Equity Funds – Global Real Estate	5.0%
Fixed-Income Funds – Intermediate-Term Bond	2.0%
Short-Term Investments	1.8%
Fixed-Income Funds – International Bond	0.1%
Fixed-Income Funds – Inflation-Protected Bond	0.1%
Total	100.0%

 Top Holdings % of Net Assets^7,8

Schwab Core Equity Fund	14.2%
Laudus Growth Investors U.S. Large Cap Growth Fund	14.1%
Schwab S&P 500 Index Fund	12.4%
Laudus International MarketMasters Fund, Select Shares	9.2%
Schwab Small-Cap Equity Fund	8.7%
TCW Relative Value Large Cap Fund	7.5%
Schwab Dividend Equity Fund	6.8%
Schwab Global Real Estate Fund	5.0%
William Blair International Small Cap Growth Fund, Institutional Shares	4.5%
Laudus Small-Cap MarketMasters Fund, Select Shares	4.4%
Total	86.8%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Target 2055 Composite Index is a custom blended index developed by CSIM based on the 2055 fund’s asset allocation glide schedule and will become more conservative as time elapses. The current composite is derived using the following portion allocations: 67.7% Dow Jones U.S. Total Stock Market Index, 21.4% MSCI EAFE Index, 2.1% Barclays U.S. Aggregate Bond Index, 4.8% FTSE EPRA/NAREIT Global Index, 0.4% Barclays U.S. Aggregate Intermediate Bond Index, 1.1% MSCI Emerging Markets Index, 0.2% Barclays U.S. TIPS Index, 0.3% Citigroup Non-U.S. Dollar World Government Bond Index, and 2.0% Barclays U.S. Treasury Bills: 1-3 Months. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.83%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized. Less than 1%.
6	The fund intends to invest in a combination of the underlying funds; however, the fund may also invest directly in equity and fixed income securities, exchange traded funds, cash equivalents, including money market securities, and futures.
7	This list is not a recommendation of any security by the investment adviser.
8	The holdings listed exclude any temporary liquidity investments.

18 Schwab Target Funds

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you incur two types of costs: transaction costs, such as redemption fees, and ongoing costs, such as management fees, transfer agent and shareholder services fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in a fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning November 1, 2012 (except where noted below) and held through April 30, 2013.

Actual Return lines in the table below provide information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ¸ $1,000 = 8.6), then multiply the result by the number given for your fund or share class under the heading entitled “Expenses Paid During Period.”

Hypothetical Return lines in the table below provide information about hypothetical account values and hypothetical expenses based on a fund’s actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as redemption fees. If these transactional costs were included, your costs would have been higher.

					Ending
					Account Value
	Expense Ratio1		Beginning		(Net of Expenses)		Expenses Paid
	(Annualized)		Account Value		at 4/30/13		During Period
Schwab Target 2010 Fund2
Actual Return		0.00%	$	1,000	$	1,063.30	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00
Schwab Target 2015 Fund2
Actual Return		0.00%	$	1,000	$	1,075.70	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00
Schwab Target 2020 Fund2
Actual Return		0.00%	$	1,000	$	1,093.80	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00
Schwab Target 2025 Fund2
Actual Return		0.00%	$	1,000	$	1,107.10	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00
Schwab Target 2030 Fund2
Actual Return		0.00%	$	1,000	$	1,117.80	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00
Schwab Target 2035 Fund2
Actual Return		0.00%	$	1,000	$	1,128.30	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00
Schwab Target 2040 Fund2
Actual Return		0.00%	$	1,000	$	1,135.30	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00
Schwab Target 2045 Fund3
Actual Return		0.01%	$	1,000	$	1,060.00	$	0.03
Hypothetical 5% Return		0.01%	$	1,000	$	1,013.40	$	0.03
Schwab Target 2050 Fund3
Actual Return		0.00%	$	1,000	$	1,061.00	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,013.42	$	0.00
Schwab Target 2055 Fund3
Actual Return		0.00%	$	1,000	$	1,062.00	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,013.42	$	0.00

1	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights. The expenses incurred by the underlying funds in which the funds invest are not included in this ratio.
2	Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year.
3	Expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 98 days of the period (from commencement of operations on 1/23/13 through 4/30/13) and divided by 365 days of the fiscal year.

Schwab Target Funds 19

Schwab Target 2010 Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		11.10			10.56			10.34			9.46			8.76			12.65
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.22			0.23			0.23			0.28			0.32
Net realized and unrealized gains (losses)		0.55			0.57			0.24			0.89			0.75			(3.73	)
Total from investment operations		0.69			0.79			0.47			1.12			1.03			(3.41	)
Less distributions:
Distributions from net investment income		(0.25	)		(0.25	)		(0.25	)		(0.24	)		(0.33	)		(0.38	)
Distributions from net realized gains		—			—			—			—			—			(0.10	)
Total distributions		(0.25	)		(0.25	)		(0.25	)		(0.24	)		(0.33	)		(0.48	)
Net asset value at end of period		11.54			11.10			10.56			10.34			9.46			8.76
Total return (%)		6.33	1		7.63			4.63	2		11.99			12.24			(27.87	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		—			—			0.00	5		0.03	6		0.06
Gross operating expenses3		0.17	4		0.18			0.14			0.16			0.16			0.11
Net investment income (loss)		2.43	4		1.95			2.11			2.21			3.04			2.89
Portfolio turnover rate		11	1		13			11			24			47			50	7
Net assets, end of period ($ x 1,000,000)		60			60			64			73			75			80

* Unaudited.

¹ Not annualized.

² Includes proceeds from a litigation settlement related to an affiliated underlying fund. Without the litigation proceeds, performance would have been lower.

³ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁴ Annualized.

⁵ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

⁶ Effective April 20, 2009 the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁷ The portfolio turnover ratio increased due to additional rebalancing activity of the underlying funds during the period.

20 See financial notes

 Schwab Target 2010 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.5%	Other Investment Companies		47,140,056		58,030,675
	3	.0%	Short-Term Investments		1,830,554		1,830,554
	99	.5%	Total Investments		48,970,610		59,861,229
	0	.5%	Other Assets and Liabilities, Net				298,835
	100	.0%	Total Net Assets				60,160,064

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.5% of net assets
Equity Funds 39.9%
Global Real Estate 2.1%
Schwab Global Real Estate Fund (a)		169,891		1,262,293
International 9.3%
American Century International Growth Fund, Institutional Shares		88,457		1,101,295
Laudus International MarketMasters Fund, Select Shares (a)		111,865		2,426,356
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		28,882		286,513
Laudus Mondrian International Equity Fund, Institutional Shares (a)		86,253		682,262
William Blair International Small Cap Growth Fund, Institutional Shares		72,036		1,090,631
				5,587,057
Large-Cap 23.2%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		239,037		3,752,884
Schwab Core Equity Fund (a)		155,191		3,283,834
Schwab Dividend Equity Fund (a)		99,648		1,654,162
Schwab S&P 500 Index Fund (a)		126,923		3,174,342
TCW Relative Value Large Cap Fund		119,313		2,085,592
				13,950,814
Small-Cap 5.3%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		70,256		1,067,887
Schwab Small-Cap Equity Fund (a)		100,481		2,112,115
				3,180,002
				23,980,166
Fixed-Income Funds 53.3%
Inflation-Protected Bond 5.4%
Schwab Treasury Inflation Protected Securities Index Fund (a)		268,674		3,259,014
Intermediate-Term Bond 32.8%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		138,944		1,790,986
PIMCO Total Return Fund, Institutional Shares		347,464		3,940,236
Schwab Intermediate-Term Bond Fund (a)		159,173		1,656,991
Schwab Total Bond Market Fund (a)		1,274,981		12,367,320
				19,755,533
International Bond 0.5%
Laudus Mondrian International Fixed Income Fund (a)		25,297		280,543
Short-Term Bond 14.6%
Schwab Short-Term Bond Market Fund (a)		940,791		8,786,988
				32,082,078
Money Market Fund 3.3%
Schwab Value Advantage Money Fund, Institutional Prime Shares (a)		1,968,431		1,968,431
Total Other Investment Companies
(Cost $47,140,056)				58,030,675
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.0% of net assets
Time Deposits 3.0%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		1,794,756		1,794,756
DNB
0.03%, 05/01/13		35,798		35,798
Total Short-Term Investments
(Cost $1,830,554)				1,830,554
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $49,920,396 and the unrealized appreciation and depreciation were $9,940,833 and ($0), respectively, with a net unrealized appreciation of $9,940,833.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 21

 Schwab Target 2010 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$58,030,675		$—		$—		$58,030,675
Short-Term Investments1		—		1,830,554		—		1,830,554
Total		$58,030,675		$1,830,554		$—		$59,861,229

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

22 See financial notes

 Schwab Target 2010 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $39,088,623)		$48,021,935
Investments in unaffiliated issuers, at value (cost $9,881,987)	+	11,839,294
Total investments, at value (cost $48,970,610)		59,861,229
Receivables:
Investments sold		450,000
Fund shares sold		274,096
Dividends		42,044
Due from investment adviser		662
Interest		1
Prepaid expenses	+	1,223
Total assets		60,629,255
Liabilities
Payables:
Investments bought		425,000
Fund shares redeemed		23,583
Accrued expenses	+	20,608
Total liabilities		469,191
Net Assets
Total assets		60,629,255
Total liabilities	−	469,191
Net assets		$60,160,064
Net Assets by Source
Capital received from investors		66,812,963
Net investment income not yet distributed		93,290
Net realized capital losses		(17,636,808	)
Net unrealized capital gains		10,890,619
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$60,160,064		5,211,178			$11.54

See financial notes 23

 Schwab Target 2010 Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$493,908
Dividends received from unaffiliated underlying funds		221,677
Interest	+	291
Total investment income		715,876
Expenses
Professional fees		17,798
Registration fees		9,513
Portfolio accounting fees		8,286
Transfer agent fees		6,310
Trustees’ fees		3,034
Shareholder reports		2,884
Custodian fees		2,026
Other expenses	+	910
Total expenses		50,761
Expense reduction by CSIM	−	50,761
Net expenses	−	—
Net investment income		715,876
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		117,376
Realized capital gain distributions received from unaffiliated underlying funds		114,772
Net realized gains on sales of affiliated underlying funds		719,885
Net realized gains on sales of unaffiliated underlying funds	+	216,758
Net realized gains		1,168,791
Net unrealized gains on affiliated underlying funds		1,463,772
Net unrealized gains on unaffiliated underlying funds	+	317,166
Net unrealized gains	+	1,780,938
Net realized and unrealized gains		2,949,729
Increase in net assets resulting from operations		$3,665,605

24 See financial notes

 Schwab Target 2010 Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$715,876			$1,222,844
Net realized gains		1,168,791			1,641,572
Net unrealized gains	+	1,780,938			1,770,890
Increase in net assets from operations		3,665,605			4,635,306
Distributions to Shareholders
Distributions from net investment income		($1,315,027	)		($1,479,450	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			535,020		$6,027,854			1,010,257		$10,890,550
Shares reinvested			111,467		1,225,017			135,161		1,389,450
Shares redeemed	+		(807,426	)	(9,068,620	)		(1,834,755	)	(19,810,132	)
Net transactions in fund shares			(160,939	)	($1,815,749	)		(689,337	)	($7,530,132	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			5,372,117		$59,625,235			6,061,454		$63,999,511
Total increase or decrease	+		(160,939	)	534,829			(689,337	)	(4,374,276	)
End of period			5,211,178		$60,160,064			5,372,117		$59,625,235
Net investment income not yet distributed					$93,290					$692,441

See financial notes 25

Schwab Target 2015 Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			3/12/081–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		11.13			10.48			10.16			9.09			8.15			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.14			0.20			0.19			0.16			0.19			0.06
Net realized and unrealized gains (losses)		0.69			0.66			0.32			1.06			0.91			(1.91	)
Total from investment operations		0.83			0.86			0.51			1.22			1.10			(1.85	)
Less distributions:
Distributions from net investment income		(0.23	)		(0.21	)		(0.19	)		(0.15	)		(0.16	)		—
Distributions from net realized gains		—			—			—			—			(0.00	)2		—
Total distributions		(0.23	)		(0.21	)		(0.19	)		(0.15	)		(0.16	)		—
Net asset value at end of period		11.73			11.13			10.48			10.16			9.09			8.15
Total return (%)		7.57	3		8.41			5.10			13.55			13.82			(18.50	)3
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses4		—	5		—			—			0.00	6		0.02	7		0.05	5
Gross operating expenses4		0.14	5		0.19			0.22			0.39			0.85			1.90	5
Net investment income (loss)		2.51	5		1.85			1.94			1.91			2.57			1.87	5
Portfolio turnover rate		8	3		13			16			13			39			35	3
Net assets, end of period ($ x 1,000,000)		85			70			53			37			17			6

* Unaudited.

¹ Commencement of operations.

² Amount less than $0.01.

³ Not annualized.

⁴ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁵ Annualized.

⁶ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

⁷ Effective April 20, 2009 the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

26 See financial notes

 Schwab Target 2015 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	95	.5%	Other Investment Companies		68,260,294		81,024,578
	4	.3%	Short-Term Investments		3,635,757		3,635,757
	99	.8%	Total Investments		71,896,051		84,660,335
	0	.2%	Other Assets and Liabilities, Net				160,871
	100	.0%	Total Net Assets				84,821,206

	Number		Value
Security	of Shares		($)
Other Investment Companies 95.5% of net assets
Equity Funds 47.4%
Global Real Estate 2.6%
Schwab Global Real Estate Fund (a)		294,633		2,189,121
International 11.1%
American Century International Growth Fund, Institutional Shares		152,215		1,895,077
Laudus International MarketMasters Fund, Select Shares (a)		181,962		3,946,755
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		47,390		470,109
Laudus Mondrian International Equity Fund, Institutional Shares (a)		161,605		1,278,294
William Blair International Small Cap Growth Fund, Institutional Shares		120,898		1,830,402
				9,420,637
Large-Cap 27.4%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		388,804		6,104,224
Schwab Core Equity Fund (a)		266,856		5,646,676
Schwab Dividend Equity Fund (a)		170,455		2,829,556
Schwab S&P 500 Index Fund (a)		207,461		5,188,591
TCW Relative Value Large Cap Fund		198,709		3,473,428
				23,242,475
Small-Cap 6.3%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		114,583		1,741,665
Schwab Small-Cap Equity Fund (a)		170,233		3,578,306
				5,319,971
				40,172,204
Fixed-Income Funds 47.2%
Inflation-Protected Bond 4.3%
Schwab Treasury Inflation Protected Securities Index Fund (a)		301,823		3,661,113
Intermediate-Term Bond 30.9%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		224,546		2,894,399
PIMCO Total Return Fund, Institutional Shares		566,673		6,426,077
Schwab Intermediate-Term Bond Fund (a)		234,846		2,444,751
Schwab Total Bond Market Fund (a)		1,490,167		14,454,618
				26,219,845
International Bond 0.9%
Laudus Mondrian International Fixed Income Fund (a)		67,887		752,865
Short-Term Bond 11.1%
Schwab Short-Term Bond Market Fund (a)		1,009,304		9,426,900
				40,060,723
Money Market Fund 0.9%
Schwab Value Advantage Money Fund, Institutional Prime Shares (a)		791,651		791,651
Total Other Investment Companies
(Cost $68,260,294)				81,024,578
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 4.3% of net assets
Time Deposits 4.3%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		2,537,728		2,537,728
DNB
0.03%, 05/01/13		1,098,029		1,098,029
Total Short-Term Investments
(Cost $3,635,757)				3,635,757
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $72,353,826 and the unrealized appreciation and depreciation were $12,306,509 and ($0), respectively, with a net unrealized appreciation of $12,306,509.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 27

 Schwab Target 2015 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$81,024,578		$—		$—		$81,024,578
Short-Term Investments1		—		3,635,757		—		3,635,757
Total		$81,024,578		$3,635,757		$—		$84,660,335

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

28 See financial notes

 Schwab Target 2015 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $53,796,451)		$64,505,195
Investments in unaffiliated issuers, at value (cost $18,099,600)	+	20,155,140
Total investments, at value (cost $71,896,051)		84,660,335
Receivables:
Investments sold		380,000
Fund shares sold		132,598
Dividends		52,605
Due from investment adviser		731
Interest		3
Prepaid expenses	+	491
Total assets		85,226,763
Liabilities
Payables:
Investments bought		370,000
Fund shares redeemed		17,504
Accrued expenses	+	18,053
Total liabilities		405,557
Net Assets
Total assets		85,226,763
Total liabilities	−	405,557
Net assets		$84,821,206
Net Assets by Source
Capital received from investors		72,407,775
Net investment income not yet distributed		120,517
Net realized capital losses		(471,370	)
Net unrealized capital gains		12,764,284
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$84,821,206		7,231,026			$11.73

See financial notes 29

 Schwab Target 2015 Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$648,342
Dividends received from unaffiliated underlying funds		291,841
Interest	+	464
Total investment income		940,647
Expenses
Professional fees		17,884
Registration fees		10,041
Portfolio accounting fees		8,388
Transfer agent fees		6,466
Shareholder reports		3,124
Trustees’ fees		3,089
Custodian fees		1,967
Other expenses	+	880
Total expenses		51,839
Expense reduction by CSIM	−	51,839
Net expenses	−	—
Net investment income		940,647
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		154,082
Realized capital gain distributions received from unaffiliated underlying funds		118,541
Net realized gains on sales of affiliated underlying funds		109,397
Net realized gains on sales of unaffiliated underlying funds	+	49,281
Net realized gains		431,301
Net unrealized gains on affiliated underlying funds		3,359,565
Net unrealized gains on unaffiliated underlying funds	+	848,079
Net unrealized gains	+	4,207,644
Net realized and unrealized gains		4,638,945
Increase in net assets resulting from operations		$5,579,592

30 See financial notes

 Schwab Target 2015 Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$940,647			$1,127,669
Net realized gains		431,301			158,165
Net unrealized gains	+	4,207,644			3,608,686
Increase in net assets from operations		5,579,592			4,894,520
Distributions to Shareholders
Distributions from net investment income		($1,464,548	)		($1,073,035	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,653,759		$18,851,954			2,292,650		$24,620,260
Shares reinvested			126,443		1,398,455			100,440		1,025,491
Shares redeemed	+		(810,274	)	(9,210,337	)		(1,182,917	)	(12,715,068	)
Net transactions in fund shares			969,928		$11,040,072			1,210,173		$12,930,683
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			6,261,098		$69,666,090			5,050,925		$52,913,922
Total increase	+		969,928		15,155,116			1,210,173		16,752,168
End of period			7,231,026		$84,821,206			6,261,098		$69,666,090
Net investment income not yet distributed					$120,517					$644,418

See financial notes 31

Schwab Target 2020 Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		11.94			11.13			10.80			9.63			8.59			12.88
Income (loss) from investment operations:
Net investment income (loss)		0.17			0.22			0.22			0.20			0.24			0.30
Net realized and unrealized gains (losses)		0.93			0.82			0.34			1.18			1.08			(4.11	)
Total from investment operations		1.10			1.04			0.56			1.38			1.32			(3.81	)
Less distributions:
Distributions from net investment income		(0.26	)		(0.23	)		(0.23	)		(0.21	)		(0.28	)		(0.38	)
Distributions from net realized gains		—			—			—			—			—			(0.10	)
Total distributions		(0.26	)		(0.23	)		(0.23	)		(0.21	)		(0.28	)		(0.48	)
Net asset value at end of period		12.78			11.94			11.13			10.80			9.63			8.59
Total return (%)		9.38	1		9.52			5.18			14.47			15.89			(30.59	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			0.00	4		0.00	4		0.02	5		0.04
Gross operating expenses2		0.05	3		0.06			0.06			0.07			0.09			0.08
Net investment income (loss)		2.65	3		1.89			1.92			2.01			2.75			2.67
Portfolio turnover rate		10	1		13			15			15			48			34	6
Net assets, end of period ($ x 1,000,000)		365			306			273			240			198			163

* Unaudited.

¹ Not annualized.

² The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

³ Annualized.

⁴ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

⁵ Effective April 20, 2009 the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁶ The portfolio turnover ratio increased due to additional rebalancing activity of the underlying funds during the period.

32 See financial notes

 Schwab Target 2020 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.2%	Other Investment Companies		275,131,987		350,876,331
	3	.7%	Short-Term Investments		13,500,685		13,500,685
	99	.9%	Total Investments		288,632,672		364,377,016
	0	.1%	Other Assets and Liabilities, Net				497,794
	100	.0%	Total Net Assets				364,874,810

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.2% of net assets
Equity Funds 60.2%
Global Real Estate 3.2%
Schwab Global Real Estate Fund (a)		1,577,409		11,720,147
International 14.2%
American Century International Growth Fund, Institutional Shares		811,138		10,098,668
Laudus International MarketMasters Fund, Select Shares (a)		983,276		21,327,261
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		262,961		2,608,575
Laudus Mondrian International Equity Fund, Institutional Shares (a)		931,606		7,369,004
William Blair International Small Cap Growth Fund, Institutional Shares		672,734		10,185,200
				51,588,708
Large-Cap 34.7%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		2,133,873		33,501,799
Schwab Core Equity Fund (a)		1,487,458		31,474,621
Schwab Dividend Equity Fund (a)		910,144		15,108,386
Schwab S&P 500 Index Fund (a)		1,138,088		28,463,568
TCW Relative Value Large Cap Fund		1,039,553		18,171,383
				126,719,757
Small-Cap 8.1%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		657,436		9,993,021
Schwab Small-Cap Equity Fund (a)		929,500		19,538,092
				29,531,113
				219,559,725
Fixed-Income Funds 36.0%
Inflation-Protected Bond 3.0%
Schwab Treasury Inflation Protected Securities Index Fund (a)		911,117		11,051,847
Intermediate-Term Bond 25.5%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		1,019,177		13,137,190
PIMCO Total Return Fund, Institutional Shares		2,462,254		27,921,956
Schwab Intermediate-Term Bond Fund (a)		993,707		10,344,493
Schwab Total Bond Market Fund (a)		4,278,155		41,498,106
				92,901,745
International Bond 1.2%
Laudus Mondrian International Fixed Income Fund (a)		398,092		4,414,839
Short-Term Bond 6.3%
Schwab Short-Term Bond Market Fund (a)		2,456,978		22,948,175
				131,316,606
Total Other Investment Companies
(Cost $275,131,987)				350,876,331
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.7% of net assets
Time Deposits 3.7%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		6,109,622		6,109,622
DNB
0.03%, 05/01/13		7,391,063		7,391,063
Total Short-Term Investments
(Cost $13,500,685)				13,500,685
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $290,981,759 and the unrealized appreciation and depreciation were $73,395,257 and ($0), respectively, with a net unrealized appreciation of $73,395,257.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 33

 Schwab Target 2020 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$350,876,331		$—		$—		$350,876,331
Short-Term Investments1		—		13,500,685		—		13,500,685
Total		$350,876,331		$13,500,685		$—		$364,377,016

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

34 See financial notes

 Schwab Target 2020 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $208,452,259)		$271,361,934
Investments in unaffiliated issuers, at value (cost $80,180,413)	+	93,015,082
Total investments, at value (cost $288,632,672)		364,377,016
Receivables:
Investments sold		1,800,000
Fund shares sold		926,980
Dividends		181,448
Due from investment adviser		957
Interest		11
Prepaid expenses	+	3,701
Total assets		367,290,113
Liabilities
Payables:
Investments bought		1,900,000
Fund shares redeemed		485,421
Accrued expenses	+	29,882
Total liabilities		2,415,303
Net Assets
Total assets		367,290,113
Total liabilities	−	2,415,303
Net assets		$364,874,810
Net Assets by Source
Capital received from investors		326,241,858
Net investment income not yet distributed		412,725
Net realized capital losses		(37,524,117	)
Net unrealized capital gains		75,744,344
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$364,874,810		28,544,276			$12.78

See financial notes 35

 Schwab Target 2020 Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$3,057,863
Dividends received from unaffiliated underlying funds		1,244,715
Interest	+	1,553
Total investment income		4,304,131
Expenses
Professional fees		18,592
Registration fees		13,413
Portfolio accounting fees		10,736
Shareholder reports		9,955
Transfer agent fees		9,601
Custodian fees		3,899
Trustees’ fees		3,827
Other expenses	+	3,307
Total expenses		73,330
Expense reduction by CSIM	−	73,330
Net expenses	−	—
Net investment income		4,304,131
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		710,495
Realized capital gain distributions received from unaffiliated underlying funds		415,932
Net realized gains on sales of affiliated underlying funds		835,772
Net realized gains on sales of unaffiliated underlying funds	+	16,276
Net realized gains		1,978,475
Net unrealized gains on affiliated underlying funds		18,295,911
Net unrealized gains on unaffiliated underlying funds	+	4,873,411
Net unrealized gains	+	23,169,322
Net realized and unrealized gains		25,147,797
Increase in net assets resulting from operations		$29,451,928

36 See financial notes

 Schwab Target 2020 Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$4,304,131			$5,461,214
Net realized gains		1,978,475			2,164,132
Net unrealized gains	+	23,169,322			18,368,445
Increase in net assets from operations		29,451,928			25,993,791
Distributions to Shareholders
Distributions from net investment income		($6,683,111	)		($5,540,387	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,733,969		$58,439,042			4,916,576		$56,647,459
Shares reinvested			542,153		6,451,623			494,589		5,361,345
Shares redeemed	+		(2,320,049	)	(28,434,253	)		(4,343,392	)	(49,793,312	)
Net transactions in fund shares			2,956,073		$36,456,412			1,067,773		$12,215,492
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			25,588,203		$305,649,581			24,520,430		$272,980,685
Total increase	+		2,956,073		59,225,229			1,067,773		32,668,896
End of period			28,544,276		$364,874,810			25,588,203		$305,649,581
Net investment income not yet distributed					$412,725					$2,791,705

See financial notes 37

Schwab Target 2025 Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			3/12/081–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		11.73			10.84			10.46			9.21			7.99			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.16			0.19			0.19			0.16			0.17			0.05
Net realized and unrealized gains (losses)		1.08			0.89			0.38			1.24			1.21			(2.06	)
Total from investment operations		1.24			1.08			0.57			1.40			1.38			(2.01	)
Less distributions:
Distributions from net investment income		(0.24	)		(0.19	)		(0.19	)		(0.15	)		(0.16	)		—
Net asset value at end of period		12.73			11.73			10.84			10.46			9.21			7.99
Total return (%)		10.71	2		10.14			5.44			15.34			17.61			(20.10	)2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		0.00	5		—			0.00	5		0.01	6		0.04	4
Gross operating expenses3		0.07	4		0.10			0.14			0.24			0.57			1.27	4
Net investment income (loss)		2.60	4		1.73			1.66			1.62			2.15			1.60	4
Portfolio turnover rate		8	2		13			9			13			44			3	2
Net assets, end of period ($ x 1,000,000)		196			141			104			63			26			8

* Unaudited.

¹ Commencement of operations.

² Not annualized.

³ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁴ Annualized.

⁵ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

⁶ Effective April 20, 2009 the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

38 See financial notes

 Schwab Target 2025 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.9%	Other Investment Companies		156,579,379		189,893,808
	2	.8%	Short-Term Investment		5,389,154		5,389,154
	99	.7%	Total Investments		161,968,533		195,282,962
	0	.3%	Other Assets and Liabilities, Net				678,299
	100	.0%	Total Net Assets				195,961,261

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.9% of net assets
Equity Funds 69.5%
Global Real Estate 3.7%
Schwab Global Real Estate Fund (a)		961,158		7,141,406
International 16.3%
American Century International Growth Fund, Institutional Shares		492,594		6,132,796
Laudus International MarketMasters Fund, Select Shares (a)		608,315		13,194,352
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		160,804		1,595,178
Laudus Mondrian International Equity Fund, Institutional Shares (a)		605,398		4,788,697
William Blair International Small Cap Growth Fund, Institutional Shares		417,103		6,314,934
				32,025,957
Large-Cap 40.1%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		1,317,032		20,677,407
Schwab Core Equity Fund (a)		951,941		20,143,076
Schwab Dividend Equity Fund (a)		568,756		9,441,354
Schwab S&P 500 Index Fund (a)		684,065		17,108,456
TCW Relative Value Large Cap Fund		640,107		11,189,075
				78,559,368
Small-Cap 9.4%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		404,816		6,153,199
Schwab Small-Cap Equity Fund (a)		582,832		12,251,131
				18,404,330
				136,131,061
Fixed-Income Funds 27.4%
Inflation-Protected Bond 2.2%
Schwab Treasury Inflation Protected Securities Index Fund (a)		361,815		4,388,818
Intermediate-Term Bond 20.5%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		526,545		6,787,165
PIMCO Total Return Fund, Institutional Shares		1,235,457		14,010,088
Schwab Intermediate-Term Bond Fund (a)		434,170		4,519,707
Schwab Total Bond Market Fund (a)		1,540,049		14,938,472
				40,255,432
International Bond 1.0%
Laudus Mondrian International Fixed Income Fund (a)		175,092		1,941,769
Short-Term Bond 3.7%
Schwab Short-Term Bond Market Fund (a)		768,386		7,176,728
				53,762,747
Total Other Investment Companies
(Cost $156,579,379)				189,893,808
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.8% of net assets
Time Deposit 2.8%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		5,389,154		5,389,154
Total Short-Term Investment
(Cost $5,389,154)				5,389,154
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $163,062,169 and the unrealized appreciation and depreciation were $32,279,402 and ($58,609), respectively, with a net unrealized appreciation of $32,220,793.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 39

 Schwab Target 2025 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$189,893,808		$—		$—		$189,893,808
Short-Term Investment1		—		5,389,154		—		5,389,154
Total		$189,893,808		$5,389,154		$—		$195,282,962

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

40 See financial notes

 Schwab Target 2025 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $117,470,205)		$145,459,750
Investments in unaffiliated issuers, at value (cost $44,498,328)	+	49,823,212
Total investments, at value (cost $161,968,533)		195,282,962
Receivables:
Fund shares sold		1,217,347
Dividends		75,664
Due from investment adviser		876
Interest		4
Prepaid expenses	+	895
Total assets		196,577,748
Liabilities
Payables:
Investments bought		550,000
Fund shares redeemed		49,149
Accrued expenses	+	17,338
Total liabilities		616,487
Net Assets
Total assets		196,577,748
Total liabilities	−	616,487
Net assets		$195,961,261
Net Assets by Source
Capital received from investors		163,750,184
Net investment income not yet distributed		180,757
Net realized capital losses		(1,284,109	)
Net unrealized capital gains		33,314,429
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$195,961,261		15,394,208			$12.73

See financial notes 41

 Schwab Target 2025 Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$1,516,259
Dividends received from unaffiliated underlying funds		615,895
Interest	+	641
Total investment income		2,132,795
Expenses
Professional fees		18,176
Registration fees		12,327
Portfolio accounting fees		9,074
Transfer agent fees		7,671
Shareholder reports		5,608
Trustees’ fees		3,290
Custodian fees		3,171
Other expenses	+	1,540
Total expenses		60,857
Expense reduction by CSIM	−	60,857
Net expenses	−	—
Net investment income		2,132,795
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		373,221
Realized capital gain distributions received from unaffiliated underlying funds		146,733
Net realized gains on sales of affiliated underlying funds		56,992
Net realized losses on sales of unaffiliated underlying funds	+	(229	)
Net realized gains		576,717
Net unrealized gains on affiliated underlying funds		11,274,663
Net unrealized gains on unaffiliated underlying funds	+	2,945,259
Net unrealized gains	+	14,219,922
Net realized and unrealized gains		14,796,639
Increase in net assets resulting from operations		$16,929,434

42 See financial notes

 Schwab Target 2025 Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$2,132,795			$2,114,588
Net realized gains (losses)		576,717			(170,384	)
Net unrealized gains	+	14,219,922			9,570,161
Increase in net assets from operations		16,929,434			11,514,365
Distributions to Shareholders
Distributions from net investment income		($2,993,027	)		($1,878,136	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			4,065,794		$49,569,783			4,252,040		$48,020,992
Shares reinvested			248,579		2,915,831			174,782		1,847,442
Shares redeemed	+		(971,459	)	(11,773,753	)		(1,997,080	)	(22,465,465	)
Net transactions in fund shares			3,342,914		$40,711,861			2,429,742		$27,402,969
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			12,051,294		$141,312,993			9,621,552		$104,273,795
Total increase	+		3,342,914		54,648,268			2,429,742		37,039,198
End of period			15,394,208		$195,961,261			12,051,294		$141,312,993
Net investment income not yet distributed					$180,757					$1,040,989

See financial notes 43

Schwab Target 2030 Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		12.42			11.43			11.05			9.69			8.51			13.15
Income (loss) from investment operations:
Net investment income (loss)		0.18			0.19			0.19			0.17			0.20			0.28
Net realized and unrealized gains (losses)		1.26			0.99			0.38			1.36			1.23			(4.47	)
Total from investment operations		1.44			1.18			0.57			1.53			1.43			(4.19	)
Less distributions:
Distributions from net investment income		(0.25	)		(0.19	)		(0.19	)		(0.17	)		(0.25	)		(0.35	)
Distributions from net realized gains		—			—			—			—			—			(0.10	)
Total distributions		(0.25	)		(0.19	)		(0.19	)		(0.17	)		(0.25	)		(0.45	)
Net asset value at end of period		13.61			12.42			11.43			11.05			9.69			8.51
Total return (%)		11.78	1		10.52			5.20			15.97			17.31			(32.83	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			—			0.00	4		0.01	5		0.03
Gross operating expenses2		0.04	3		0.05			0.05			0.08			0.11			0.10
Net investment income (loss)		2.67	3		1.62			1.60			1.64			2.37			2.35
Portfolio turnover rate		7	1		12			8			14			50			31	6
Net assets, end of period ($ x 1,000,000)		535			444			372			296			200			129

* Unaudited.

¹ Not annualized.

² The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

³ Annualized.

⁴ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

⁵ Effective April 20, 2009 the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁶ The portfolio turnover ratio increased due to additional rebalancing activity of the underlying funds during the period.

44 See financial notes

 Schwab Target 2030 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.4%	Other Investment Companies		393,242,966		520,999,441
	2	.4%	Short-Term Investment		12,840,214		12,840,214
	99	.8%	Total Investments		406,083,180		533,839,655
	0	.2%	Other Assets and Liabilities, Net				952,355
	100	.0%	Total Net Assets				534,792,010

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.4% of net assets
Equity Funds 77.1%
Global Real Estate 4.0%
Schwab Global Real Estate Fund (a)		2,892,242		21,489,360
International 18.2%
American Century International Growth Fund, Institutional Shares		1,510,873		18,810,368
Laudus International MarketMasters Fund, Select Shares (a)		1,817,411		39,419,649
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		490,870		4,869,427
Laudus Mondrian International Equity Fund, Institutional Shares (a)		1,878,764		14,861,026
William Blair International Small Cap Growth Fund, Institutional Shares		1,278,467		19,355,985
				97,316,455
Large-Cap 44.4%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		3,939,180		61,845,124
Schwab Core Equity Fund (a)		2,840,352		60,101,851
Schwab Dividend Equity Fund (a)		1,714,189		28,455,530
Schwab S&P 500 Index Fund (a)		2,136,795		53,441,245
TCW Relative Value Large Cap Fund		1,905,102		33,301,180
				237,144,930
Small-Cap 10.5%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		1,265,244		19,231,715
Schwab Small-Cap Equity Fund (a)		1,761,487		37,026,459
				56,258,174
				412,208,919
Fixed-Income Funds 20.3%
Inflation-Protected Bond 1.5%
Schwab Treasury Inflation Protected Securities Index Fund (a)		682,200		8,275,090
Intermediate-Term Bond 15.8%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		1,071,698		13,814,182
PIMCO Total Return Fund, Institutional Shares		2,649,752		30,048,186
Schwab Intermediate-Term Bond Fund (a)		911,376		9,487,424
Schwab Total Bond Market Fund (a)		3,222,811		31,261,267
				84,611,059
International Bond 1.1%
Laudus Mondrian International Fixed Income Fund (a)		515,090		5,712,343
Short-Term Bond 1.9%
Schwab Short-Term Bond Market Fund (a)		1,091,224		10,192,030
				108,790,522
Total Other Investment Companies
(Cost $393,242,966)				520,999,441
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.4% of net assets
Time Deposit 2.4%
Skandinaviska Enskilda Banken
0.03%, 05/01/13		12,840,214		12,840,214
Total Short-Term Investment
(Cost $12,840,214)				12,840,214
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $410,229,872 and the unrealized appreciation and depreciation were $123,609,783 and ($0), respectively, with a net unrealized appreciation of $123,609,783.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 45

 Schwab Target 2030 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$520,999,441		$—		$—		$520,999,441
Short-Term Investment1		—		12,840,214		—		12,840,214
Total		$520,999,441		$12,840,214		$—		$533,839,655

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

46 See financial notes

 Schwab Target 2030 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $297,730,862)		$405,669,540
Investments in unaffiliated issuers, at value (cost $108,352,318)	+	128,170,115
Total investments, at value (cost $406,083,180)		533,839,655
Receivables:
Investments sold		590,000
Fund shares sold		1,126,820
Dividends		162,777
Due from investment adviser		1,124
Interest		11
Prepaid expenses	+	4,312
Total assets		535,724,699
Liabilities
Payables:
Investments bought		600,000
Fund shares redeemed		296,941
Accrued expenses	+	35,748
Total liabilities		932,689
Net Assets
Total assets		535,724,699
Total liabilities	−	932,689
Net assets		$534,792,010
Net Assets by Source
Capital received from investors		439,161,532
Net investment income not yet distributed		315,390
Net realized capital losses		(32,441,387	)
Net unrealized capital gains		127,756,475
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$534,792,010		39,300,468			$13.61

See financial notes 47

 Schwab Target 2030 Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$4,780,770
Dividends received from unaffiliated underlying funds		1,616,061
Interest	+	1,684
Total investment income		6,398,515
Expenses
Professional fees		19,114
Registration fees		15,490
Shareholder reports		15,227
Transfer agent fees		13,396
Portfolio accounting fees		12,133
Custodian fees		5,331
Trustees’ fees		4,235
Other expenses	+	4,564
Total expenses		89,490
Expense reduction by CSIM	−	89,490
Net expenses	−	—
Net investment income		6,398,515
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		1,154,935
Realized capital gain distributions received from unaffiliated underlying funds		304,132
Net realized gains on sales of affiliated underlying funds		543,780
Net realized gains on sales of unaffiliated underlying funds	+	14,710
Net realized gains		2,017,557
Net unrealized gains on affiliated underlying funds		36,345,973
Net unrealized gains on unaffiliated underlying funds	+	9,298,530
Net unrealized gains	+	45,644,503
Net realized and unrealized gains		47,662,060
Increase in net assets resulting from operations		$54,060,575

48 See financial notes

 Schwab Target 2030 Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$6,398,515			$6,636,601
Net realized gains (losses)		2,017,557			(485,756	)
Net unrealized gains	+	45,644,503			34,048,464
Increase in net assets from operations		54,060,575			40,199,309
Distributions to Shareholders
Distributions from net investment income		($9,003,665	)		($6,263,907	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			5,917,550		$76,710,182			8,178,626		$97,318,546
Shares reinvested			703,372		8,749,953			547,142		6,095,164
Shares redeemed	+		(3,083,107	)	(39,782,082	)		(5,482,400	)	(64,862,336	)
Net transactions in fund shares			3,537,815		$45,678,053			3,243,368		$38,551,374
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			35,762,653		$444,057,047			32,519,285		$371,570,271
Total increase	+		3,537,815		90,734,963			3,243,368		72,486,776
End of period			39,300,468		$534,792,010			35,762,653		$444,057,047
Net investment income not yet distributed					$315,390					$2,920,540

See financial notes 49

Schwab Target 2035 Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			3/12/081–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		11.69			10.70			10.32			9.00			7.76			10.00
Income (loss) from investment operations:
Net investment income (loss)		0.17			0.16			0.16			0.13			0.15			0.04
Net realized and unrealized gains (losses)		1.31			0.99			0.38			1.33			1.23			(2.28	)
Total from investment operations		1.48			1.15			0.54			1.46			1.38			(2.24	)
Less distributions:
Distributions from net investment income		(0.22	)		(0.16	)		(0.16	)		(0.14	)		(0.14	)		—
Net asset value at end of period		12.95			11.69			10.70			10.32			9.00			7.76
Total return (%)		12.83	2		10.89			5.27			16.29			18.22			(22.40	)2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		—	4		—			—			0.00	5		0.01	6		0.02	4
Gross operating expenses3		0.09	4		0.13			0.17			0.30			0.67			1.57	4
Net investment income (loss)		2.59	4		1.45			1.41			1.38			1.92			1.32	4
Portfolio turnover rate		4	2		11			4			14			49			7	2
Net assets, end of period ($ x 1,000,000)		153			111			77			49			22			6

* Unaudited.

¹ Commencement of operations.

² Not annualized.

³ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁴ Annualized.

⁵ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

⁶ Effective April 20, 2009 the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

50 See financial notes

 Schwab Target 2035 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.8%	Other Investment Companies		119,761,252		149,825,240
	2	.1%	Short-Term Investment		3,247,820		3,247,820
	99	.9%	Total Investments		123,009,072		153,073,060
	0	.1%	Other Assets and Liabilities, Net				199,336
	100	.0%	Total Net Assets				153,272,396

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.8% of net assets
Equity Funds 84.1%
Global Real Estate 4.4%
Schwab Global Real Estate Fund (a)		905,978		6,731,413
International 19.8%
American Century International Growth Fund, Institutional Shares		465,936		5,800,897
Laudus International MarketMasters Fund, Select Shares (a)		567,980		12,319,490
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		154,150		1,529,168
Laudus Mondrian International Equity Fund, Institutional Shares (a)		597,518		4,726,368
William Blair International Small Cap Growth Fund, Institutional Shares		398,473		6,032,885
				30,408,808
Large-Cap 48.4%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		1,228,587		19,288,816
Schwab Core Equity Fund (a)		907,091		19,194,055
Schwab Dividend Equity Fund (a)		541,985		8,996,959
Schwab S&P 500 Index Fund (a)		650,497		16,268,918
TCW Relative Value Large Cap Fund		593,160		10,368,436
				74,117,184
Small-Cap 11.5%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		389,664		5,922,894
Schwab Small-Cap Equity Fund (a)		554,142		11,648,066
				17,570,960
				128,828,365
Fixed-Income Funds 13.7%
Inflation-Protected Bond 1.0%
Schwab Treasury Inflation Protected Securities Index Fund (a)		124,389		1,508,838
Intermediate-Term Bond 11.2%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		250,360		3,227,143
PIMCO Total Return Fund, Institutional Shares		589,298		6,682,645
Schwab Intermediate-Term Bond Fund (a)		200,133		2,083,389
Schwab Total Bond Market Fund (a)		533,715		5,177,037
				17,170,214
International Bond 0.6%
Laudus Mondrian International Fixed Income Fund (a)		90,505		1,003,704
Short-Term Bond 0.9%
Schwab Short-Term Bond Market Fund (a)		140,698		1,314,119
				20,996,875
Total Other Investment Companies
(Cost $119,761,252)				149,825,240
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.1% of net assets
Time Deposit 2.1%
Skandinaviska Enskilda Banken
0.03%, 05/01/13		3,247,820		3,247,820
Total Short-Term Investment
(Cost $3,247,820)				3,247,820
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $123,921,040 and the unrealized appreciation and depreciation were $29,191,271 and ($39,251), respectively, with a net unrealized appreciation of $29,152,020.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 51

 Schwab Target 2035 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$149,825,240		$—		$—		$149,825,240
Short-Term Investment1		—		3,247,820		—		3,247,820
Total		$149,825,240		$3,247,820		$—		$153,073,060

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

52 See financial notes

 Schwab Target 2035 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $92,334,031)		$117,713,234
Investments in unaffiliated issuers, at value (cost $30,675,041)	+	35,359,826
Total investments, at value (cost $123,009,072)		153,073,060
Receivables:
Fund shares sold		452,590
Dividends		32,266
Due from investment adviser		846
Interest		3
Prepaid expenses	+	686
Total assets		153,559,451
Liabilities
Payables:
Investments bought		230,000
Fund shares redeemed		37,517
Accrued expenses	+	19,538
Total liabilities		287,055
Net Assets
Total assets		153,559,451
Total liabilities	−	287,055
Net assets		$153,272,396
Net Assets by Source
Capital received from investors		124,257,565
Net investment income not yet distributed		73,669
Net realized capital losses		(1,122,826	)
Net unrealized capital gains		30,063,988
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$153,272,396		11,833,789			$12.95

See financial notes 53

 Schwab Target 2035 Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$1,254,600
Dividends received from unaffiliated underlying funds		412,609
Interest	+	405
Total investment income		1,667,614
Expenses
Professional fees		18,033
Registration fees		11,284
Portfolio accounting fees		8,762
Transfer agent fees		7,084
Shareholder reports		5,739
Trustees’ fees		3,214
Custodian fees		3,102
Other expenses	+	1,223
Total expenses		58,441
Expense reduction by CSIM	−	58,441
Net expenses	−	—
Net investment income		1,667,614
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		300,916
Realized capital gain distributions received from unaffiliated underlying funds		49,589
Net realized gains on sales of affiliated underlying funds		33,493
Net realized gains on sales of unaffiliated underlying funds	+	60
Net realized gains		384,058
Net unrealized gains on affiliated underlying funds		10,963,062
Net unrealized gains on unaffiliated underlying funds	+	2,718,669
Net unrealized gains	+	13,681,731
Net realized and unrealized gains		14,065,789
Increase in net assets resulting from operations		$15,733,403

54 See financial notes

 Schwab Target 2035 Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$1,667,614			$1,339,939
Net realized gains (losses)		384,058			(188,323	)
Net unrealized gains	+	13,681,731			8,193,560
Increase in net assets from operations		15,733,403			9,345,176
Distributions to Shareholders
Distributions from net investment income		($2,151,560	)		($1,173,912	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			2,990,382		$36,700,863			3,123,482		$35,158,038
Shares reinvested			178,770		2,102,339			110,095		1,149,391
Shares redeemed	+		(788,842	)	(9,622,448	)		(1,018,757	)	(11,399,175	)
Net transactions in fund shares			2,380,310		$29,180,754			2,214,820		$24,908,254
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			9,453,479		$110,509,799			7,238,659		$77,430,281
Total increase	+		2,380,310		42,762,597			2,214,820		33,079,518
End of period			11,833,789		$153,272,396			9,453,479		$110,509,799
Net investment income not yet distributed					$73,669					$557,615

See financial notes 55

Schwab Target 2040 Fund

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		12.67			11.55			11.16			9.71			8.48			13.45
Income (loss) from investment operations:
Net investment income (loss)		0.18			0.17			0.17			0.15			0.18			0.28
Net realized and unrealized gains (losses)		1.51			1.12			0.40			1.46			1.27			(4.80	)
Total from investment operations		1.69			1.29			0.57			1.61			1.45			(4.52	)
Less distributions:
Distributions from net investment income		(0.24	)		(0.17	)		(0.18	)		(0.16	)		(0.22	)		(0.36	)
Distributions from net realized gains		—			—			—			—			—			(0.09	)
Total distributions		(0.24	)		(0.17	)		(0.18	)		(0.16	)		(0.22	)		(0.45	)
Net asset value at end of period		14.12			12.67			11.55			11.16			9.71			8.48
Total return (%)		13.53	1		11.33			5.08			16.71			17.66			(34.60	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		—	3		—			—			0.00	4		0.00	4,5		0.01
Gross operating expenses2		0.04	3		0.06			0.06			0.10			0.15			0.15
Net investment income (loss)		2.69	3		1.42			1.42			1.44			2.15			2.22
Portfolio turnover rate		3	1		12			3			15			51			36	6
Net assets, end of period ($ x 1,000,000)		542			435			342			259			163			94

* Unaudited.

¹ Not annualized.

² The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

³ Annualized.

⁴ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

⁵ Effective April 20, 2009 the net operating expense limitation was lowered. The ratio presented for period ended 10/31/09 is a blended ratio.

⁶ The portfolio turnover ratio increased due to additional rebalancing activity of the underlying funds during the period.

56 See financial notes

 Schwab Target 2040 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.9%	Other Investment Companies		397,254,950		530,171,714
	2	.1%	Short-Term Investment		11,269,349		11,269,349
	100	.0%	Total Investments		408,524,299		541,441,063
	0	.0%	Other Assets and Liabilities, Net				193,899
	100	.0%	Total Net Assets				541,634,962

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.9% of net assets
Equity Funds 89.1%
Global Real Estate 4.6%
Schwab Global Real Estate Fund (a)		3,366,664		25,014,313
International 21.1%
American Century International Growth Fund, Institutional Shares		1,768,310		22,015,454
Laudus International MarketMasters Fund, Select Shares (a)		2,112,547		45,821,139
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		572,184		5,676,063
Laudus Mondrian International Equity Fund, Institutional Shares (a)		2,284,036		18,066,722
William Blair International Small Cap Growth Fund, Institutional Shares		1,493,764		22,615,584
				114,194,962
Large-Cap 51.1%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		4,556,722		71,540,530
Schwab Core Equity Fund (a)		3,373,295		71,378,918
Schwab Dividend Equity Fund (a)		2,009,701		33,361,030
Schwab S&P 500 Index Fund (a)		2,494,024		62,375,533
TCW Relative Value Large Cap Fund		2,194,548		38,360,696
				277,016,707
Small-Cap 12.3%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		1,495,596		22,733,057
Schwab Small-Cap Equity Fund (a)		2,076,390		43,645,717
				66,378,774
				482,604,756
Fixed-Income Funds 8.8%
Inflation-Protected Bond 0.7%
Schwab Treasury Inflation Protected Securities Index Fund (a)		300,601		3,646,296
Intermediate-Term Bond 6.9%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		577,370		7,442,294
PIMCO Total Return Fund, Institutional Shares		1,514,862		17,178,539
Schwab Intermediate-Term Bond Fund (a)		389,544		4,055,152
Schwab Total Bond Market Fund (a)		891,986		8,652,264
				37,328,249
International Bond 0.5%
Laudus Mondrian International Fixed Income Fund (a)		236,466		2,622,408
Short-Term Bond 0.7%
Schwab Short-Term Bond Market Fund (a)		425,054		3,970,005
				47,566,958
Total Other Investment Companies
(Cost $397,254,950)				530,171,714
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 2.1% of net assets
Time Deposit 2.1%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		11,269,349		11,269,349
Total Short-Term Investment
(Cost $11,269,349)				11,269,349
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $412,883,289 and the unrealized appreciation and depreciation were $128,576,482 and ($18,708), respectively, with a net unrealized appreciation of $128,557,774.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 57

 Schwab Target 2040 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$530,171,714		$—		$—		$530,171,714
Short-Term Investment1		—		11,269,349		—		11,269,349
Total		$530,171,714		$11,269,349		$—		$541,441,063

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

58 See financial notes

 Schwab Target 2040 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $310,516,963)		$422,559,147
Investments in unaffiliated issuers, at value (cost $98,007,336)	+	118,881,916
Total investments, at value (cost $408,524,299)		541,441,063
Receivables:
Fund shares sold		943,829
Dividends		73,044
Due from investment adviser		1,315
Interest		9
Prepaid expenses	+	3,737
Total assets		542,462,997
Liabilities
Payables:
Investments bought		450,000
Fund shares redeemed		320,830
Accrued expenses	+	57,205
Total liabilities		828,035
Net Assets
Total assets		542,462,997
Total liabilities	−	828,035
Net assets		$541,634,962
Net Assets by Source
Capital received from investors		434,846,714
Net investment income not yet distributed		98,074
Net realized capital losses		(26,226,590	)
Net unrealized capital gains		132,916,764
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$541,634,962		38,354,791			$14.12

See financial notes 59

 Schwab Target 2040 Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$4,991,509
Dividends received from unaffiliated underlying funds		1,461,758
Interest	+	1,468
Total investment income		6,454,735
Expenses
Shareholder reports		26,393
Professional fees		19,113
Transfer agent fees		17,752
Registration fees		15,754
Portfolio accounting fees		12,070
Custodian fees		5,568
Trustees’ fees		4,203
Other expenses	+	4,385
Total expenses		105,238
Expense reduction by CSIM	−	105,238
Net expenses	−	—
Net investment income		6,454,735
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		1,184,113
Realized capital gain distributions received from unaffiliated underlying funds		120,451
Net realized gains on sales of affiliated underlying funds	+	346,257
Net realized gains		1,650,821
Net unrealized gains on affiliated underlying funds		43,060,800
Net unrealized gains on unaffiliated underlying funds	+	10,672,290
Net unrealized gains	+	53,733,090
Net realized and unrealized gains		55,383,911
Increase in net assets resulting from operations		$61,838,646

60 See financial notes

 Schwab Target 2040 Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$6,454,735			$5,524,403
Net realized gains (losses)		1,650,821			(1,275,324	)
Net unrealized gains	+	53,733,090			36,407,167
Increase in net assets from operations		61,838,646			40,656,246
Distributions to Shareholders
Distributions from net investment income		($8,424,619	)		($5,065,636	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			6,171,675		$82,227,419			9,337,484		$113,340,523
Shares reinvested			647,209		8,251,913			440,155		4,960,552
Shares redeemed	+		(2,786,381	)	(37,082,699	)		(5,085,156	)	(61,428,310	)
Net transactions in fund shares			4,032,503		$53,396,633			4,692,483		$56,872,765
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			34,322,288		$434,824,302			29,629,805		$342,360,927
Total increase	+		4,032,503		106,810,660			4,692,483		92,463,375
End of period			38,354,791		$541,634,962			34,322,288		$434,824,302
Net investment income not yet distributed					$98,074					$2,067,958

See financial notes 61

Schwab Target 2045 Fund

Financial Statements

Financial Highlights

	1/23/131–
	4/30/13*
Per-Share Data ($)
Net asset value at beginning of period		10.00
Income (loss) from investment operations:
Net investment income (loss)		0.01
Net realized and unrealized gains (losses)		0.59
Total from investment operations		0.60
Net asset value at end of period		10.60
Total return (%)		6.00	2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		0.01	4,5
Gross operating expenses3		3.20	4
Net investment income (loss)		0.47	4
Portfolio turnover rate		2	2
Net assets, end of period ($ x 1,000,000)		4

* Unaudited.

¹ Commencement of operations.

² Not annualized.

³ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁴ Annualized.

⁵ The ratio of net operating expenses would have been 0.00%, if interest expense had not been incurred.

62 See financial notes

 Schwab Target 2045 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.6%	Other Investment Companies		3,817,712		3,968,305
	1	.2%	Short-Term Investment		48,870		48,870
	98	.8%	Total Investments		3,866,582		4,017,175
	1	.2%	Other Assets and Liabilities, Net				47,950
	100	.0%	Total Net Assets				4,065,125

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.6% of net assets
Equity Funds 91.7%
Global Real Estate 4.8%
Schwab Global Real Estate Fund (a)		26,369		195,919
International 21.7%
American Century International Growth Fund, Institutional Shares		13,341		166,093
Laudus International MarketMasters Fund, Select Shares (a)		16,495		357,780
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		4,343		43,085
Laudus Mondrian International Equity Fund, Institutional Shares (a)		17,752		140,416
William Blair International Small Cap Growth Fund, Institutional Shares		11,544		174,769
				882,143
Large-Cap 52.6%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		35,143		551,750
Schwab Core Equity Fund (a)		26,268		555,826
Schwab Dividend Equity Fund (a)		15,961		264,952
Schwab S&P 500 Index Fund (a)		18,908		472,880
TCW Relative Value Large Cap Fund		16,713		292,150
				2,137,558
Small-Cap 12.6%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		11,282		171,481
Schwab Small-Cap Equity Fund (a)		16,145		339,378
				510,859
				3,726,479
Fixed-Income Funds 5.9%
Inflation-Protected Bond 0.2%
Schwab Treasury Inflation Protected Securities Index Fund (a)		608		7,373
Intermediate-Term Bond 5.1%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		4,718		60,821
PIMCO Total Return Fund, Institutional Shares		10,224		115,943
Schwab Intermediate-Term Bond Fund (a)		1,516		15,778
Schwab Total Bond Market Fund (a)		1,854		17,980
				210,522
International Bond 0.1%
Laudus Mondrian International Fixed Income Fund (a)		394		4,374
Short-Term Bond 0.5%
Schwab Short-Term Bond Market Fund (a)		2,094		19,557
				241,826
Total Other Investment Companies
(Cost $3,817,712)				3,968,305
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 1.2% of net assets
Time Deposit 1.2%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		48,870		48,870
Total Short-Term Investment
(Cost $48,870)				48,870
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $3,866,582 and the unrealized appreciation and depreciation were $150,719 and ($126), respectively, with a net unrealized appreciation of $150,593.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 63

 Schwab Target 2045 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$3,968,305		$—		$—		$3,968,305
Short-Term Investment1		—		48,870		—		48,870
Total		$3,968,305		$48,870		$—		$4,017,175

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

64 See financial notes

 Schwab Target 2045 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated issuers, at value (cost $3,038,312)		$3,158,529
Investments in unaffiliated issuers, at value (cost $828,270)	+	858,646
Total investments, at value (cost $3,866,582)		4,017,175
Receivables:
Fund shares sold		89,377
Due from investment adviser		509
Dividends	+	347
Total assets		4,107,408
Liabilities
Payables:
Investments bought		34,100
Accrued expenses	+	8,183
Total liabilities		42,283
Net Assets
Total assets		4,107,408
Total liabilities	−	42,283
Net assets		$4,065,125
Net Assets by Source
Capital received from investors		3,911,559
Net investment income not yet distributed		3,005
Net realized capital losses		(32	)
Net unrealized capital gains		150,593
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$4,065,125		383,674			$10.60

See financial notes 65

 Schwab Target 2045 Fund

Statement of

Operations

For the period January 23, 2013* through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$1,614
Dividends received from unaffiliated underlying funds		1,452
Interest	+	2
Total investment income		3,068
Expenses
Professional fees		6,573
Shareholder reports		4,843
Transfer agent fees		3,590
Portfolio accounting fees		3,252
Trustees’ fees		904
Custodian fees		646
Registration fees		199
Interest expense		63
Other expenses	+	207
Total expenses		20,277
Expense reduction by CSIM	−	20,214
Net expenses	−	63
Net investment income		3,005
Realized and Unrealized Gains (Losses)
Net realized losses on sales of unaffiliated underlying funds		(32	)
Net unrealized gains on affiliated underlying funds		120,217
Net unrealized gains on unaffiliated underlying funds	+	30,376
Net unrealized gains	+	150,593
Net realized and unrealized gains		150,561
Increase in net assets resulting from operations		$153,566

* Commencement of operations.

66 See financial notes

 Schwab Target 2045 Fund

Statement of

Changes in Net Assets

For the current period only
Figures for the current period are unaudited

Operations

1/23/13*-4/30/13
Net investment income		$3,005
Net realized losses		(32	)
Net unrealized gains	+	150,593
Increase in net assets from operations		$153,566

Transactions in Fund Shares

		1/23/13*-4/30/13
			SHARES		VALUE
Shares sold			386,326		$3,938,498
Shares redeemed	+		(2,652	)	(26,939	)
Net transactions in fund shares			383,674		$3,911,559
Shares Outstanding and Net Assets
		1/23/13*-4/30/13
			SHARES		NET ASSETS
Beginning of period			—		$—
Total increase	+		383,674		4,065,125
End of period			383,674		$4,065,125
Net investment income not yet distributed					$3,005

* Commencement of operations.

See financial notes 67

Schwab Target 2050 Fund

Financial Statements

Financial Highlights

	1/23/131–
	4/30/13*
Per-Share Data ($)
Net asset value at beginning of period		10.00
Income (loss) from investment operations:
Net investment income (loss)		0.01
Net realized and unrealized gains (losses)		0.60
Total from investment operations		0.61
Net asset value at end of period		10.61
Total return (%)		6.10	2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		0.00	4,5
Gross operating expenses3		4.01	4
Net investment income (loss)		0.43	4
Portfolio turnover rate		0	2,6
Net assets, end of period ($ x 1,000,000)		3

* Unaudited.

¹ Commencement of operations.

² Not annualized.

³ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁴ Annualized.

⁵ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if interest expense had not been incurred.

⁶ Less than 1%.

68 See financial notes

 Schwab Target 2050 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.9%	Other Investment Companies		3,125,825		3,249,695
	1	.4%	Short-Term Investment		47,475		47,475
	99	.3%	Total Investments		3,173,300		3,297,170
	0	.7%	Other Assets and Liabilities, Net				22,929
	100	.0%	Total Net Assets				3,320,099

	Number		Value
Security	of Shares		($)
Other Investment Companies 97.9% of net assets
Equity Funds 94.3%
Global Real Estate 4.9%
Schwab Global Real Estate Fund (a)		22,020		163,611
International 22.3%
American Century International Growth Fund, Institutional Shares		11,370		141,553
Laudus International MarketMasters Fund, Select Shares (a)		13,790		299,107
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		3,662		36,328
Laudus Mondrian International Equity Fund, Institutional Shares (a)		14,949		118,243
William Blair International Small Cap Growth Fund, Institutional Shares		9,672		146,441
				741,672
Large-Cap 54.1%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		29,517		463,412
Schwab Core Equity Fund (a)		22,135		468,373
Schwab Dividend Equity Fund (a)		13,284		220,511
Schwab S&P 500 Index Fund (a)		15,868		396,855
TCW Relative Value Large Cap Fund		14,096		246,407
				1,795,558
Small-Cap 13.0%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		9,543		145,047
Schwab Small-Cap Equity Fund (a)		13,596		285,783
				430,830
				3,131,671
Fixed-Income Funds 3.6%
Inflation-Protected Bond 0.1%
Schwab Treasury Inflation Protected Securities Index Fund (a)		266		3,223
Intermediate-Term Bond 3.3%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		2,737		35,275
PIMCO Total Return Fund, Institutional Shares		5,660		64,187
Schwab Intermediate-Term Bond Fund (a)		637		6,628
Schwab Total Bond Market Fund (a)		453		4,392
				110,482
International Bond 0.1%
Laudus Mondrian International Fixed Income Fund (a)		263		2,916
Short-Term Bond 0.1%
Schwab Short-Term Bond Market Fund (a)		150		1,403
				118,024
Total Other Investment Companies
(Cost $3,125,825)				3,249,695
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 1.4% of net assets
Time Deposit 1.4%
Skandinaviska Enskilda Banken
0.03%, 05/01/13		47,475		47,475
Total Short-Term Investment
(Cost $47,475)				47,475
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $3,173,300 and the unrealized appreciation and depreciation were $123,954 and ($84), respectively, with a net unrealized appreciation of $123,870.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 69

 Schwab Target 2050 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$3,249,695		$—		$—		$3,249,695
Short-Term Investment1		—		47,475		—		47,475
Total		$3,249,695		$47,475		$—		$3,297,170

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

70 See financial notes

 Schwab Target 2050 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $2,516,781)		$2,615,832
Investments in unaffiliated issuers, at value (cost $656,519)	+	681,338
Total investments, at value (cost $3,173,300)		3,297,170
Receivables:
Fund shares sold		39,079
Due from investment adviser		509
Dividends	+	176
Total assets		3,336,934
Liabilities
Payables:
Investments bought		8,900
Fund shares redeemed		211
Accrued expenses	+	7,724
Total liabilities		16,835
Net Assets
Total assets		3,336,934
Total liabilities	−	16,835
Net assets		$3,320,099
Net Assets by Source
Capital received from investors		3,194,091
Net investment income not yet distributed		2,165
Net realized capital losses		(27	)
Net unrealized capital gains		123,870
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$3,320,099		312,851			$10.61

See financial notes 71

 Schwab Target 2050 Fund

Statement of

Operations

For the period January 23, 2013* through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$1,222
Dividends received from unaffiliated underlying funds		950
Interest	+	2
Total investment income		2,174
Expenses
Professional fees		6,573
Shareholder reports		4,843
Transfer agent fees		3,590
Portfolio accounting fees		3,251
Trustees’ fees		904
Custodian fees		646
Registration fees		199
Interest expense		9
Other expenses	+	207
Total expenses		20,222
Expense reduction by CSIM	−	20,213
Net expenses	−	9
Net investment income		2,165
Realized and Unrealized Gains (Losses)
Net realized losses on sales of affiliated underlying funds		(27	)
Net unrealized gains on affiliated underlying funds		99,051
Net unrealized gains on unaffiliated underlying funds	+	24,819
Net unrealized gains	+	123,870
Net realized and unrealized gains		123,843
Increase in net assets resulting from operations		$126,008

* Commencement of operations.

72 See financial notes

 Schwab Target 2050 Fund

Statement of

Changes in Net Assets

For the current period only
Figures for the current period are unaudited

Operations

1/23/13*-4/30/13
Net investment income		$2,165
Net realized losses		(27	)
Net unrealized gains	+	123,870
Increase in net assets from operations		$126,008

Transactions in Fund Shares

		1/23/13*-4/30/13
			SHARES		VALUE
Shares sold			315,589		$3,222,582
Shares redeemed	+		(2,738	)	(28,491	)
Net transactions in fund shares			312,851		$3,194,091
Shares Outstanding and Net Assets
		1/23/13*-4/30/13
			SHARES		NET ASSETS
Beginning of period			—		$—
Total increase	+		312,851		3,320,099
End of period			312,851		$3,320,099
Net investment income not yet distributed					$2,165

* Commencement of operations.

See financial notes 73

Schwab Target 2055 Fund

Financial Statements

Financial Highlights

	1/23/131–
	4/30/13*
Per-Share Data ($)
Net asset value at beginning of period		10.00
Income (loss) from investment operations:
Net investment income (loss)		0.01
Net realized and unrealized gains (losses)		0.61
Total from investment operations		0.62
Net asset value at end of period		10.62
Total return (%)		6.20	2
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses3		0.00	4,5
Gross operating expenses3		5.03	4
Net investment income (loss)		0.36	4
Portfolio turnover rate		0	2,6
Net assets, end of period ($ x 1,000,000)		3

* Unaudited.

¹ Commencement of operations.

² Not annualized.

³ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁴ Annualized.

⁵ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if interest expense had not been incurred.

⁶ Less than 1%.

74 See financial notes

 Schwab Target 2055 Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	98	.1%	Other Investment Companies		2,434,691		2,536,660
	1	.8%	Short-Term Investment		47,791		47,791
	99	.9%	Total Investments		2,482,482		2,584,451
	0	.1%	Other Assets and Liabilities, Net				2,519
	100	.0%	Total Net Assets				2,586,970

	Number		Value
Security	of Shares		($)
Other Investment Companies 98.1% of net assets
Equity Funds 96.0%
Global Real Estate 5.0%
Schwab Global Real Estate Fund (a)		17,507		130,077
International 22.7%
American Century International Growth Fund, Institutional Shares		8,927		111,139
Laudus International MarketMasters Fund, Select Shares (a)		10,955		237,607
Laudus Mondrian Emerging Markets Fund, Institutional Shares (a)		2,868		28,447
Laudus Mondrian International Equity Fund, Institutional Shares (a)		11,842		93,673
William Blair International Small Cap Growth Fund, Institutional Shares		7,709		116,710
				587,576
Large-Cap 55.1%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		23,255		365,104
Schwab Core Equity Fund (a)		17,401		368,211
Schwab Dividend Equity Fund (a)		10,628		176,427
Schwab S&P 500 Index Fund (a)		12,833		320,956
TCW Relative Value Large Cap Fund		11,034		192,873
				1,423,571
Small-Cap 13.2%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		7,568		115,031
Schwab Small-Cap Equity Fund (a)		10,746		225,885
				340,916
				2,482,140
Fixed-Income Funds 2.1%
Inflation-Protected Bond 0.1%
Schwab Treasury Inflation Protected Securities Index Fund (a)		141		1,710
Intermediate-Term Bond 1.9%
Natixis Loomis Sayles Investment Grade Bond Fund, Class Y Shares		1,228		15,834
PIMCO Total Return Fund, Institutional Shares		2,755		31,242
Schwab Intermediate-Term Bond Fund (a)		347		3,617
Schwab Total Bond Market Fund (a)		18		173
				50,866
International Bond 0.1%
Laudus Mondrian International Fixed Income Fund (a)		175		1,944
				54,520
Total Other Investment Companies
(Cost $2,434,691)				2,536,660
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 1.8% of net assets
Time Deposit 1.8%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		47,791		47,791
Total Short-Term Investment
(Cost $47,791)				47,791
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $2,482,482 and the unrealized appreciation and depreciation were $102,025 and ($56), respectively, with a net unrealized appreciation of $101,969.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

See financial notes 75

 Schwab Target 2055 Fund

Portfolio Holdings (Unaudited) continued

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$2,536,660		$—		$—		$2,536,660
Short-Term Investment1		—		47,791		—		47,791
Total		$2,536,660		$47,791		$—		$2,584,451

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

76 See financial notes

 Schwab Target 2055 Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $1,987,274)		$2,068,862
Investments in unaffiliated issuers, at value (cost $495,208)	+	515,589
Total investments, at value (cost $2,482,482)		2,584,451
Receivables:
Fund shares sold		45,024
Due from investment adviser		509
Dividends	+	76
Total assets		2,630,060
Liabilities
Payables:
Investments bought		34,100
Accrued expenses	+	8,990
Total liabilities		43,090
Net Assets
Total assets		2,630,060
Total liabilities	−	43,090
Net assets		$2,586,970
Net Assets by Source
Capital received from investors		2,483,568
Net investment income not yet distributed		1,464
Net realized capital losses		(31	)
Net unrealized capital gains		101,969
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$2,586,970		243,625			$10.62

See financial notes 77

 Schwab Target 2055 Fund

Statement of

Operations

For the period January 23, 2013* through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$862
Dividends received from unaffiliated underlying funds		613
Interest	+	2
Total investment income		1,477
Expenses
Professional fees		6,573
Shareholder reports		4,843
Transfer agent fees		3,590
Portfolio accounting fees		3,252
Trustees’ fees		904
Custodian fees		646
Registration fees		199
Interest expense		13
Other expenses	+	207
Total expenses		20,227
Expense reduction by CSIM	−	20,214
Net expenses	−	13
Net investment income		1,464
Realized and Unrealized Gains (Losses)
Net realized losses on sales of affiliated underlying funds		(31	)
Net unrealized gains on affiliated underlying funds		81,588
Net unrealized gains on unaffiliated underlying funds	+	20,381
Net unrealized gains	+	101,969
Net realized and unrealized gains		101,938
Increase in net assets resulting from operations		$103,402

* Commencement of operations.

78 See financial notes

 Schwab Target 2055 Fund

Statement of

Changes in Net Assets

For the current period only
Figures for the current period are unaudited

Operations

1/23/13*-4/30/13
Net investment income		$1,464
Net realized losses		(31	)
Net unrealized gains	+	101,969
Increase in net assets from operations		$103,402

Transactions in Fund Shares

		1/23/13*-4/30/13
			SHARES		VALUE
Shares sold			245,104		$2,498,805
Shares redeemed	+		(1,479	)	(15,237	)
Net transactions in fund shares			243,625		$2,483,568
Shares Outstanding and Net Assets
		1/23/13*-4/30/13
			SHARES		NET ASSETS
Beginning of period			—		$—
Total increase	+		243,625		2,586,970
End of period			243,625		$2,586,970
Net investment income not yet distributed					$1,464

* Commencement of operations.

See financial notes 79

 Schwab Target Funds

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds discussed in this report is a series of Schwab Capital Trust (the “trust”), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trust as of the end of the period, including the funds discussed in this report, which are highlighted:

Schwab Capital Trust (organized May 7, 1993)	Laudus Small-Cap MarketMasters Fund
Schwab Target 2010 Fund	Laudus International MarketMasters Fund
Schwab Target 2015 Fund	Schwab Balanced Fund
Schwab Target 2020 Fund	Schwab Core Equity Fund
Schwab Target 2025 Fund	Schwab Dividend Equity Fund
Schwab Target 2030 Fund	Schwab Large-Cap Growth Fund
Schwab Target 2035 Fund	Schwab Small-Cap Equity Fund
Schwab Target 2040 Fund	Schwab Hedged Equity Fund
Schwab Target 2045 Fund	Schwab Financial Services Fund
Schwab Target 2050 Fund	Schwab Health Care Fund
Schwab Target 2055 Fund	Schwab International Core Equity Fund
Schwab S&P 500 Index Fund	Schwab Fundamental US Large Company Index Fund
Schwab Small-Cap Index Fund	Schwab Fundamental US Small Company Index Fund
Schwab Total Stock Market Index Fund	Schwab Fundamental International Large Company Index Fund
Schwab International Index Fund	Schwab Fundamental International Small Company Index Fund
Schwab MarketTrack All Equity Portfolio	Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab MarketTrack Growth Portfolio	Schwab Monthly Income Fund - Moderate Payout
Schwab MarketTrack Balanced Portfolio	Schwab Monthly Income Fund - Enhanced Payout
Schwab MarketTrack Conservative Portfolio	Schwab Monthly Income Fund - Maximum Payout

The Schwab Target Funds are “fund of funds.” Each of the funds seeks to achieve its investment objective by investing in a combination of other Schwab and/or Laudus Funds and other unaffiliated, third-party mutual funds, in accordance with its target portfolio allocation. Each fund may also invest directly in equity and fixed income securities, exchange traded funds (“ETFs”), cash equivalents, including money market securities, and futures. Each fund bears its share of the allocable expenses of the underlying funds in which they invest.

Each fund in this report offers one share class. Shares are bought and sold (subject to a redemption fee, see financial note 8) at closing net asset value per share (“NAV”), which is the price for all outstanding shares of the funds. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the “Board”) may authorize the issuance of as many shares as necessary.

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 may also keep certain assets in segregated accounts, as required by securities law.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the Securities Exchange Commission (“SEC”).

(a) Security Valuation:

Under procedures approved by the Board, the investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

The funds value the securities in their portfolios every business day. The funds use the following policies to value various types of securities:

•  Underlying funds: Mutual funds are valued at their respective net asset values.

•  Securities for which no quoted value is available: The Board has adopted procedures to fair value each fund’s securities when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is

80 

 Schwab Target Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Each fund makes fair value determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ techniques such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing Committee regularly reviews these inputs and assumptions to calibrate the valuations. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security. The Board convenes on a regular basis to review fair value determinations made by the funds pursuant to the valuation procedures.

•  Short-term securities (60 days or less to maturity): Short-term securities are valued at amortized cost, which approximates market value.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If the funds determine that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

•  Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities. Investments in mutual funds are valued daily at their NAVs, which are classified as Level 1 prices.

•  Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. As investments whose values are classified as Level 2 prices include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

•  Level 3 — significant unobservable inputs (including the funds’ own assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not available for these securities, the funds use one or more valuation techniques for which sufficient and reliable data is available. The inputs used by the funds in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the funds in the absence of market information. Assumptions used by the funds due to the lack of observable inputs may significantly impact the resulting fair value and therefore the funds’ results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the funds’ investments as of April 30, 2013 are disclosed in the Portfolio Holdings.

81

 Schwab Target Funds

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(b) Security Transactions:

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains or losses from security transactions are based on the identified costs of the securities involved.

(c) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds 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. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

(d) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within the trust generally are allocated among the funds in proportion to their average daily net assets.

(e) Distributions to Shareholders:

The funds make distributions from net investment income and net realized capital gains, if any, once a year.

(f) Accounting Estimates:

The accounting policies described in this report conform to GAAP. 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 and these differences may be material.

(g) Federal Income Taxes:

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.

(h) Indemnification:

Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.

(i) New Accounting Pronouncements:

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative instruments. Management is currently evaluating the impact the adoption of ASU No. 2011-11 may have on the funds’ financial statement disclosures.

3. Risk Factors:

Investing in the funds may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Asset Allocation Risk. The funds are subject to asset allocation risk, which is the risk that the selection of the underlying funds and the allocation of a fund’s assets among the various asset classes and market segments will cause the funds to underperform other funds with a similar investment objective.

82 

 Schwab Target Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

Affiliated Fund Risk. The investment adviser’s authority to select and substitute underlying funds from a variety of affiliated and unaffiliated mutual funds may create a conflict of interest because the fees paid to it by some underlying funds are higher than the fees paid by other underlying funds. However, the portfolio manager is a fiduciary to the fund and is legally obligated to act in the fund’s best interests when selecting underlying funds, without taking fees into consideration.

Market Risk. Stock and bond markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of an investment in the funds will fluctuate, which means that an investor could lose money.

Underlying Fund Investment Risk. The value of your investment in the funds is based primarily on the prices of the underlying funds that the fund purchases. In turn, the price of each underlying fund is based on the value of its securities. Before investing in the funds, investors should assess the risks associated with the underlying funds in which the funds may invest and the types of investments made by those underlying funds. These risks include any combination of the risks described below, although a fund’s exposure to a particular risk will be proportionate to the fund’s overall asset allocation and underlying fund allocation.

•  Investment Risk. An investment in an underlying fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The funds may experience losses with respect to their investment in an underlying fund. Further, there is no guarantee that an underlying fund will be able to achieve its objective.

•  Management Risk. Generally, the underlying funds are actively managed mutual funds. Any actively managed mutual fund is subject to the risk that its investment adviser (or sub-adviser(s)) will make poor security selections. An underlying fund’s adviser applies its own investment techniques and risk analyses in making investment decisions for the fund, but there can be no guarantee that they will produce the desired results.

•  Fixed Income Risk. Interest rates rise and fall over time, which will affect an underlying fund’s yield and share price. The credit quality of a portfolio investment could also cause an underlying fund’s share price to fall. An underlying fund could lose money if the issuer or guarantor of a portfolio investment or the counterparty to a derivatives contract fails to make timely principal or interest payments or otherwise honor its obligations. Fixed income securities may be paid off earlier or later than expected. Either situation could cause a fund to hold securities paying lower-than-market rates of interest, which could hurt the fund’s yield or share price. Below investment-grade bonds (junk bonds) involve greater credit risk, are more volatile, involve greater risk of price declines and may be more susceptible to economic downturns than investment-grade securities.

•  Equity Risk. The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

•  Large-, Mid- and Small-Cap Risk. Stocks of different market capitalizations tend to go in and out of favor based on market and economic conditions. Historically, small- and mid-cap stocks tend to be more volatile than large-cap stocks, and small-cap stocks have been riskier than large- and mid-cap stocks. During a period when stocks of a particular market capitalization fall behind other types of investments - bonds or stocks of another capitalization range, for instance -and underlying fund’s large-, mid- or small-cap holdings could reduce performance.

•  Money Market Risk. Although an underlying money market fund seeks to maintain a stable $1 net asset value, it is possible to lose money by investing in a money market fund. In addition, a money market fund is not designed to offer capital appreciation.

•  Exchange-Traded Funds (ETFs) Risk. When an underlying fund invests in an ETF, it will bear a proportionate share of the ETF’s expenses. In addition, lack of liquidity in an ETF can result in its value being more volatile than the underlying portfolio of securities.

•  Foreign Investment Risk. An underlying fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may be heightened in connection with investments in emerging markets.

83

 Schwab Target Funds

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

•  Emerging Markets Risk. Emerging market countries may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Such countries often have less uniformity in accounting and reporting requirements and greater risk associated with the custody of securities. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in other countries. As a result, there will tend to be an increased risk of price volatility associated with an underlying fund’s investments in emerging market countries and, at times, it may be difficult to value such investments.

•  Derivatives Risk. An underlying fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments and could cause the fund to lose more than the principal amount invested.

•  Leverage Risk. Certain underlying fund transactions, such as derivatives, short sales, reverse repurchase agreements, and mortgage dollar rolls, may give rise to a form of leverage and may expose a fund to greater risk. Leverage tends to magnify the effect of any decrease or increase in the value of an underlying fund’s portfolio securities, which means even a small amount of leverage can have a disproportionately large impact on the fund.

•  Liquidity Risk. A particular investment may be difficult to purchase or sell. An underlying fund may be unable to sell illiquid securities at an advantageous time or price.

•  Portfolio Turnover Risk. Certain of the underlying funds may buy and sell portfolio securities actively. If they do, their portfolio turnover rate and transaction costs will rise, which may lower the underlying fund’s performance and may increase the likelihood of capital gain distributions.

Direct Investment Risk. The funds may invest a portion of their assets directly in equity and fixed income securities, ETFs, cash equivalents, including money market securities, and futures. A fund’s direct investment in these securities is subject to the same or similar risks as an underlying fund’s investment in the same security.

Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.

4. Affiliates and Affiliated Transactions:

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement (“Advisory Agreement”) between CSIM and the trust.

The Board has adopted a Shareholder Servicing Plan (the “Plan”) on behalf of the funds. The Plan enables each fund to bear expenses relating to the provision by service providers, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, “Schwab”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds. The funds are not subject to any fee under the Plan.

CSIM and its affiliates have agreed with the funds to limit (“expense limitation”) the total annual fund operating expense charged, excluding interest, taxes and certain non-routine expenses of the funds to 0.00%, for so long as CSIM serves as the investment adviser to the funds, which may only be amended or terminated with the approval of the Board.

The agreement to limit the funds’ total expenses charged is limited to each fund’s direct operating expenses and, therefore, does not apply to underlying fund fees and expenses, which are indirect expenses incurred by a fund through its investments in the underlying funds.

84 

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

The funds may engage in certain transactions involving related parties. Pursuant to an exemptive order issued by the SEC, the funds may invest in other related funds. As of April 30, 2013, the percentages of shares of other related funds owned by each Schwab Target fund are:

	Schwab			Schwab			Schwab		Schwab		Schwab		Schwab		Schwab		Schwab			Schwab			Schwab
	Target			Target			Target		Target		Target		Target		Target		Target			Target			Target
	2010			2015			2020		2025		2030		2035		2040		2045			2050			2055
	Fund			Fund			Fund		Fund		Fund		Fund		Fund		Fund			Fund			Fund
Schwab Global Real Estate Fund		0.5%			0.9%			4.7%		2.8%		8.6%		2.7%		10.0%		0.1%			0.1%			0.1%
Laudus International MarketMasters Fund		0.1%			0.2%			1.1%		0.7%		2.0%		0.6%		2.3%		0.0%	*		0.0%	*		0.0%	*
Laudus Mondrian Emerging Markets Fund		0.2%			0.3%			1.4%		0.9%		2.7%		0.8%		3.1%		0.0%	*		0.0%	*		0.0%	*
Laudus Mondrian International Equity Fund		0.5%			0.9%			5.3%		3.4%		10.7%		3.4%		13.0%		0.1%			0.1%			0.1%
Laudus Growth Investors U.S. Large Cap Growth Fund		0.2%			0.4%			2.0%		1.2%		3.6%		1.1%		4.2%		0.0%	*		0.0%	*		0.0%	*
Schwab Core Equity Fund		0.2%			0.3%			1.5%		1.0%		2.9%		0.9%		3.4%		0.0%	*		0.0%	*		0.0%	*
Schwab Dividend Equity Fund		0.1%			0.2%			0.9%		0.6%		1.8%		0.6%		2.1%		0.0%	*		0.0%	*		0.0%	*
Schwab S&P 500 Index Fund		0.0%	*		0.0%	*		0.2%		0.1%		0.4%		0.1%		0.4%		0.0%	*		0.0%	*		0.0%	*
Laudus Small-Cap MarketMasters Fund		0.6%			1.0%			5.8%		3.6%		11.2%		3.4%		13.2%		0.1%			0.1%			0.1%
Schwab Small-Cap Equity Fund		0.5%			0.8%			4.2%		2.6%		7.9%		2.5%		9.3%		0.1%			0.1%			0.0%	*
Schwab Treasury Inflation Protected Securities Index Fund		0.8%			0.9%			2.7%		1.1%		2.1%		0.4%		0.9%		0.0%	*		0.0%	*		0.0%	*
Schwab Intermediate-Term Bond Fund		0.4%			0.6%			2.7%		1.2%		2.5%		0.5%		1.1%		0.0%	*		0.0%	*		0.0%	*
Schwab Total Bond Market Fund		1.3%			1.6%			4.5%		1.6%		3.4%		0.6%		0.9%		0.0%	*		0.0%	*		0.0%	*
Laudus Mondrian International Fixed Income Fund		0.0%	*		0.1%			0.6%		0.3%		0.8%		0.1%		0.4%		0.0%	*		0.0%	*		0.0%	*
Schwab Short-Term Bond Market Fund		2.1%			2.2%			5.4%		1.7%		2.4%		0.3%		0.9%		0.0%	*		0.0%	*		—%
Schwab Value Advantage Money Fund		0.0%	*		0.0%	*		—%		—%		—%		—%		—%		—%			—%			—%

* Less than 0.05%

85

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Below is a summary of the funds’ transactions with their affiliated underlying funds during the period ended April 30, 2013.

Schwab Target 2010 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		177,346		7,142		(14,597	)		169,891		$1,262,293		($9,477	)		$52,400
Laudus International MarketMasters Fund, Select Shares		116,581		7,617		(12,333	)		111,865		2,426,356		22,701			53,965
Laudus Mondrian Emerging Markets Fund, Institutional Shares		26,234		2,648		—			28,882		286,513		—			5,779
Laudus Mondrian International Equity Fund, Institutional Shares		117,378		—		(31,125	)		86,253		682,262		51,010			24,282
Laudus Growth Investors U.S. Large Cap Growth Fund		253,807		4,909		(19,679	)		239,037		3,752,884		38,629			70,000
Schwab Core Equity Fund		176,428		—		(21,237	)		155,191		3,283,834		88,575			27,891
Schwab Dividend Equity Fund		90,825		22,988		(14,165	)		99,648		1,654,162		24,253			13,426
Schwab S&P 500 Index Fund		146,513		24,540		(44,130	)		126,923		3,174,342		160,484			73,381
Laudus Small-Cap MarketMasters Fund, Select Shares		85,620		—		(15,364	)		70,256		1,067,887		46,696			—
Schwab Small-Cap Equity Fund		122,940		1,781		(24,240	)		100,481		2,112,115		93,232			11,464
Schwab Treasury Inflation Protected Securities Index Fund		204,985		74,827		(11,138	)		268,674		3,259,014		2,602			27,885
Schwab Intermediate-Term Bond Fund		247,103		3,868		(91,798	)		159,173		1,656,991		91,978			61,351
Schwab Total Bond Market Fund		1,177,680		177,010		(79,709	)		1,274,981		12,367,320		(3,362	)		143,835
Laudus Mondrian International Fixed Income Fund		103,637		—		(78,340	)		25,297		280,543		111,598			11,786
Schwab Short-Term Bond Market Fund		817,827		143,345		(20,381	)		940,791		8,786,988		966			33,035
Schwab Value Advantage Money Fund, Institutional Prime Shares		1,968,431		—		—			1,968,431		1,968,431		—			804
Total											$48,021,935		$719,885			$611,284

86 

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2015 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		258,572		46,224		(10,163	)		294,633		$2,189,121		$1,458			$79,044
Laudus International MarketMasters Fund, Select Shares		166,741		25,186		(9,965	)		181,962		3,946,755		9,895			78,759
Laudus Mondrian Emerging Markets Fund, Institutional Shares		37,971		9,419		—			47,390		470,109		—			8,365
Laudus Mondrian International Equity Fund, Institutional Shares		179,270		13,542		(31,207	)		161,605		1,278,294		(13,612	)		42,750
Laudus Growth Investors U.S. Large Cap Growth Fund		366,369		45,555		(23,120	)		388,804		6,104,224		1,977			103,004
Schwab Core Equity Fund		255,575		30,663		(19,382	)		266,856		5,646,676		13,199			42,374
Schwab Dividend Equity Fund		146,381		61,807		(37,733	)		170,455		2,829,556		35,545			23,308
Schwab S&P 500 Index Fund		211,081		27,540		(31,160	)		207,461		5,188,591		32,817			107,874
Laudus Small-Cap MarketMasters Fund, Select Shares		125,994		7,613		(19,024	)		114,583		1,741,665		21,280			—
Schwab Small-Cap Equity Fund		178,503		15,835		(24,105	)		170,233		3,578,306		37,938			17,380
Schwab Treasury Inflation Protected Securities Index Fund		178,532		123,291		—			301,823		3,661,113		—			25,907
Schwab Intermediate-Term Bond Fund		246,466		22,129		(33,749	)		234,846		2,444,751		(7,681	)		69,408
Schwab Total Bond Market Fund		1,307,532		205,180		(22,545	)		1,490,167		14,454,618		(266	)		157,625
Laudus Mondrian International Fixed Income Fund		124,364		—		(56,477	)		67,887		752,865		(23,153	)		15,357
Schwab Short-Term Bond Market Fund		643,712		381,669		(16,077	)		1,009,304		9,426,900		—			30,946
Schwab Value Advantage Money Fund, Institutional Prime Shares		791,651		—		—			791,651		791,651		—			323
Total											$64,505,195		$109,397			$802,424

87

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2020 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		1,411,094		195,555		(29,240	)		1,577,409		$11,720,147		($30,702	)		$431,885
Laudus International MarketMasters Fund, Select Shares		896,916		126,330		(39,970	)		983,276		21,327,261		23,504			415,182
Laudus Mondrian Emerging Markets Fund, Institutional Shares		230,704		42,440		(10,183	)		262,961		2,608,575		9,955			50,824
Laudus Mondrian International Equity Fund, Institutional Shares		1,097,893		26,093		(192,380	)		931,606		7,369,004		(21,660	)		270,049
Laudus Growth Investors U.S. Large Cap Growth Fund		1,920,567		235,599		(22,293	)		2,133,873		33,501,799		1,214			530,650
Schwab Core Equity Fund		1,506,321		84,692		(103,555	)		1,487,458		31,474,621		261,432			249,748
Schwab Dividend Equity Fund		897,769		210,451		(198,076	)		910,144		15,108,386		234,225			140,717
Schwab S&P 500 Index Fund		1,100,514		112,111		(74,537	)		1,138,088		28,463,568		57,761			555,895
Laudus Small-Cap MarketMasters Fund, Select Shares		689,754		15,826		(48,144	)		657,436		9,993,021		57,848			—
Schwab Small-Cap Equity Fund		974,191		52,074		(96,765	)		929,500		19,538,092		167,959			93,815
Schwab Treasury Inflation Protected Securities Index Fund		678,365		232,752		—			911,117		11,051,847		—			94,157
Schwab Intermediate-Term Bond Fund		841,848		151,859		—			993,707		10,344,493		—			245,637
Schwab Total Bond Market Fund		5,768,889		185,117		(1,675,851	)		4,278,155		41,498,106		90,324			550,970
Laudus Mondrian International Fixed Income Fund		581,669		—		(183,577	)		398,092		4,414,839		(16,088	)		73,258
Schwab Short-Term Bond Market Fund		990,297		1,466,681		—			2,456,978		22,948,175		—			65,571
Total											$271,361,934		$835,772			$3,768,358

88 

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2025 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		738,602		228,353		(5,797	)		961,158		$7,141,406		($348	)		$239,552
Laudus International MarketMasters Fund, Select Shares		482,662		138,960		(13,307	)		608,315		13,194,352		(1,650	)		228,009
Laudus Mondrian Emerging Markets Fund, Institutional Shares		107,098		53,706		—			160,804		1,595,178		—			24,524
Laudus Mondrian International Equity Fund, Institutional Shares		541,190		78,020		(13,812	)		605,398		4,788,697		(10,642	)		135,694
Laudus Growth Investors U.S. Large Cap Growth Fund		1,045,290		278,161		(6,419	)		1,317,032		20,677,407		385			299,008
Schwab Core Equity Fund		756,512		195,429		—			951,941		20,143,076		—			130,346
Schwab Dividend Equity Fund		432,893		152,247		(16,384	)		568,756		9,441,354		4,990			73,871
Schwab S&P 500 Index Fund		601,049		123,297		(40,281	)		684,065		17,108,456		(1,395	)		314,282
Laudus Small-Cap MarketMasters Fund, Select Shares		366,578		44,740		(6,502	)		404,816		6,153,199		1,749			—
Schwab Small-Cap Equity Fund		517,658		94,638		(29,464	)		582,832		12,251,131		17,097			51,237
Schwab Treasury Inflation Protected Securities Index Fund		218,488		143,327		—			361,815		4,388,818		—			33,707
Schwab Intermediate-Term Bond Fund		364,703		69,467		—			434,170		4,519,707		—			109,242
Schwab Total Bond Market Fund		2,309,976		195,596		(965,523	)		1,540,049		14,938,472		67,797			208,820
Laudus Mondrian International Fixed Income Fund		197,130		—		(22,038	)		175,092		1,941,769		(20,991	)		25,193
Schwab Short-Term Bond Market Fund		—		768,386		—			768,386		7,176,728		—			15,995
Total											$145,459,750		$56,992			$1,889,480

89

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2030 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		2,551,100		341,142		—			2,892,242		$21,489,360		$—			$795,933
Laudus International MarketMasters Fund, Select Shares		1,659,346		180,273		(22,208	)		1,817,411		39,419,649		5,129			773,796
Laudus Mondrian Emerging Markets Fund, Institutional Shares		428,307		66,595		(4,032	)		490,870		4,869,427		81			94,356
Laudus Mondrian International Equity Fund, Institutional Shares		1,925,261		45,761		(92,258	)		1,878,764		14,861,026		(70,968	)		471,632
Laudus Growth Investors U.S. Large Cap Growth Fund		3,513,555		438,462		(12,837	)		3,939,180		61,845,124		—			987,398
Schwab Core Equity Fund		2,778,306		125,736		(63,690	)		2,840,352		60,101,851		31,595			460,643
Schwab Dividend Equity Fund		1,621,619		160,893		(68,323	)		1,714,189		28,455,530		21,856			263,098
Schwab S&P 500 Index Fund		2,009,168		199,904		(72,277	)		2,136,795		53,441,245		14,906			1,023,064
Laudus Small-Cap MarketMasters Fund, Select Shares		1,283,238		25,669		(43,663	)		1,265,244		19,231,715		29,660			—
Schwab Small-Cap Equity Fund		1,799,946		80,633		(119,092	)		1,761,487		37,026,459		144,771			173,160
Schwab Treasury Inflation Protected Securities Index Fund		515,949		166,251		—			682,200		8,275,090		—			71,614
Schwab Intermediate-Term Bond Fund		875,743		35,633		—			911,376		9,487,424		—			247,974
Schwab Total Bond Market Fund		5,559,975		143,781		(2,480,945	)		3,222,811		31,261,267		403,953			472,158
Laudus Mondrian International Fixed Income Fund		602,655		—		(87,565	)		515,090		5,712,343		(37,203	)		77,019
Schwab Short-Term Bond Market Fund		—		1,091,224		—			1,091,224		10,192,030		—			23,860
Total											$405,669,540		$543,780			$5,935,705

90 

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2035 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		696,043		209,935		—			905,978		$6,731,413		$—			$226,706
Laudus International MarketMasters Fund, Select Shares		452,339		115,641		—			567,980		12,319,490		—			212,295
Laudus Mondrian Emerging Markets Fund, Institutional Shares		103,661		50,489		—			154,150		1,529,168		—			23,534
Laudus Mondrian International Equity Fund, Institutional Shares		524,753		85,423		(12,658	)		597,518		4,726,368		(12,715	)		131,762
Laudus Growth Investors U.S. Large Cap Growth Fund		974,826		253,761		—			1,228,587		19,288,816		—			275,897
Schwab Core Equity Fund		721,316		185,775		—			907,091		19,194,055		—			123,393
Schwab Dividend Equity Fund		416,050		130,079		(4,144	)		541,985		8,996,959		623			72,156
Schwab S&P 500 Index Fund		562,467		110,008		(21,978	)		650,497		16,268,918		(4,242	)		289,819
Laudus Small-Cap MarketMasters Fund, Select Shares		346,414		46,501		(3,251	)		389,664		5,922,894		1,170			—
Schwab Small-Cap Equity Fund		486,881		72,016		(4,755	)		554,142		11,648,066		29			47,958
Schwab Treasury Inflation Protected Securities Index Fund		82,497		41,892		—			124,389		1,508,838		—			12,071
Schwab Intermediate-Term Bond Fund		153,909		46,224		—			200,133		2,083,389		—			46,676
Schwab Total Bond Market Fund		912,826		49,834		(428,945	)		533,715		5,177,037		48,628			78,614
Laudus Mondrian International Fixed Income Fund		90,505		—		—			90,505		1,003,704		—			11,567
Schwab Short-Term Bond Market Fund		—		140,698		—			140,698		1,314,119		—			3,068
Total											$117,713,234		$33,493			$1,555,516

91

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2040 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		2,884,647		482,017		—			3,366,664		$25,014,313		$—			$911,514
Laudus International MarketMasters Fund, Select Shares		1,853,396		259,151		—			2,112,547		45,821,139		—			869,468
Laudus Mondrian Emerging Markets Fund, Institutional Shares		470,587		101,597		—			572,184		5,676,063		—			104,829
Laudus Mondrian International Equity Fund, Institutional Shares		2,259,474		31,496		(6,934	)		2,284,036		18,066,722		(6,103	)		581,363
Laudus Growth Investors U.S. Large Cap Growth Fund		4,006,125		550,597		—			4,556,722		71,540,530		—			1,133,974
Schwab Core Equity Fund		3,039,424		333,871		—			3,373,295		71,378,918		—			512,791
Schwab Dividend Equity Fund		1,795,863		213,838		—			2,009,701		33,361,030		—			301,344
Schwab S&P 500 Index Fund		2,293,002		236,186		(35,164	)		2,494,024		62,375,533		174			1,178,870
Laudus Small-Cap MarketMasters Fund, Select Shares		1,433,445		73,796		(11,645	)		1,495,596		22,733,057		102			—
Schwab Small-Cap Equity Fund		2,021,083		72,629		(17,322	)		2,076,390		43,645,717		7,694			197,378
Schwab Treasury Inflation Protected Securities Index Fund		259,785		40,816		—			300,601		3,646,296		—			41,723
Schwab Intermediate-Term Bond Fund		379,919		9,625		—			389,544		4,055,152		—			107,165
Schwab Total Bond Market Fund		2,359,356		9,241		(1,476,611	)		891,986		8,652,264		361,176			192,651
Laudus Mondrian International Fixed Income Fund		280,249		—		(43,783	)		236,466		2,622,408		(16,786	)		35,816
Schwab Short-Term Bond Market Fund		—		425,054		—			425,054		3,970,005		—			6,736
Total											$422,559,147		$346,257			$6,175,622

92 

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2045 Fund:
	Balance						Balance				Realized		Distributions
	of Shares						of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross		Held at		Value at		01/23/13(a)		01/23/13(a)
Underlying Funds	1/23/13(a)		Additions		Sales		04/30/13		04/30/13		to 04/30/13		to 04/30/13
Schwab Global Real Estate Fund		—		26,369		—		26,369		$195,919		$—		$972
Laudus International MarketMasters Fund, Select Shares		—		16,495		—		16,495		357,780		—		—
Laudus Mondrian Emerging Markets Fund, Institutional Shares		—		4,343		—		4,343		43,085		—		—
Laudus Mondrian International Equity Fund, Institutional Shares		—		17,752		—		17,752		140,416		—		—
Laudus Growth Investors U.S. Large Cap Growth Fund		—		35,143		—		35,143		551,750		—		—
Schwab Core Equity Fund		—		26,268		—		26,268		555,826		—		—
Schwab Dividend Equity Fund		—		15,961		—		15,961		264,952		—		443
Schwab S&P 500 Index Fund		—		18,908		—		18,908		472,880		—		—
Laudus Small-Cap MarketMasters Fund, Select Shares		—		11,282		—		11,282		171,481		—		—
Schwab Small-Cap Equity Fund		—		16,145		—		16,145		339,378		—		—
Schwab Treasury Inflation Protected Securities Index Fund		—		608		—		608		7,373		—		—
Schwab Intermediate-Term Bond Fund		—		1,516		—		1,516		15,778		—		64
Schwab Total Bond Market Fund		—		1,854		—		1,854		17,980		—		109
Laudus Mondrian International Fixed Income Fund		—		394		—		394		4,374		—		—
Schwab Short-Term Bond Market Fund		—		2,094		—		2,094		19,557		—		26
Total										$3,158,529		$—		$1,614

93

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2050 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		1/23/13(a)			1/23/13(a)
Underlying Funds	1/23/13(a)		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		—		22,020		—			22,020		$163,611		$—			$792
Laudus International MarketMasters Fund, Select Shares		—		13,790		—			13,790		299,107		—			—
Laudus Mondrian Emerging Markets Fund, Institutional Shares		—		3,662		—			3,662		36,328		—			—
Laudus Mondrian International Equity Fund, Institutional Shares		—		14,949		—			14,949		118,243		—			—
Laudus Growth Investors U.S. Large Cap Growth Fund		—		29,517		—			29,517		463,412		—			—
Schwab Core Equity Fund		—		22,135		—			22,135		468,373		—			—
Schwab Dividend Equity Fund		—		13,284		—			13,284		220,511		—			360
Schwab S&P 500 Index Fund		—		15,868		—			15,868		396,855		—			—
Laudus Small-Cap MarketMasters Fund, Select Shares		—		9,543		—			9,543		145,047		—			—
Schwab Small-Cap Equity Fund		—		13,596		—			13,596		285,783		—			—
Schwab Treasury Inflation Protected Securities Index Fund		—		266		—			266		3,223		—			—
Schwab Intermediate-Term Bond Fund		—		637		—			637		6,628		—			30
Schwab Total Bond Market Fund		—		973		(520	)		453		4,392		(27	)		38
Laudus Mondrian International Fixed Income Fund		—		263		—			263		2,916		—			—
Schwab Short-Term Bond Market Fund		—		150		—			150		1,403		—			2
Total											$2,615,832		($27	)		$1,222

94 

 Schwab Target Funds

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab Target 2055 Fund:
	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		1/23/13(a)			1/23/13(a)
Underlying Funds	1/23/13(a)		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Schwab Global Real Estate Fund		—		17,507		—			17,507		$130,077		$—			$574
Laudus International MarketMasters Fund, Select Shares		—		10,955		—			10,955		237,607		—			—
Laudus Mondrian Emerging Markets Fund, Institutional Shares		—		2,868		—			2,868		28,447		—			—
Laudus Mondrian International Equity Fund, Institutional Shares		—		11,842		—			11,842		93,673		—			—
Laudus Growth Investors U.S. Large Cap Growth Fund		—		23,255		—			23,255		365,104		—			—
Schwab Core Equity Fund		—		17,401		—			17,401		368,211		—			—
Schwab Dividend Equity Fund		—		10,628		—			10,628		176,427		—			254
Schwab S&P 500 Index Fund		—		12,833		—			12,833		320,956		—			—
Laudus Small-Cap MarketMasters Fund, Select Shares		—		7,568		—			7,568		115,031		—			—
Schwab Small-Cap Equity Fund		—		10,746		—			10,746		225,885		—			—
Schwab Treasury Inflation Protected Securities Index Fund		—		141		—			141		1,710		—			—
Schwab Intermediate-Term Bond Fund		—		347		—			347		3,617		—			18
Schwab Total Bond Market Fund		—		642		(624	)		18		173		(31	)		16
Laudus Mondrian International Fixed Income Fund		—		175		—			175		1,944		—			—
Total											$2,068,862		($31	)		$862

*	Distributions received include distributions from net investment income and capital gains, if any, from the underlying funds.
(a)	Commencement of operations.

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other Schwab Funds. All loans are for temporary or emergency purposes only. The interest rate to be charged on a loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.

5. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted in each fund’s Statement of Operations. For information regarding the trustees please refer to Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The funds have access to custodian overdraft facilities, a committed line of credit of $150 million with State Street Bank and Trust Company (“State Street”), an uncommitted line of credit of $100 million with Bank of America, N.A. and an uncommitted line of credit of $50 million with Brown Brothers Harriman & Co. The funds pay interest on the amounts they borrow at rates that are negotiated periodically. The funds also pay an annual fee to State Street for the committed line of credit.

95

 Schwab Target Funds

Financial Notes, unaudited (continued)

6. Borrowing from Banks (continued):

There were no borrowings from the lines of credit by the funds during the period. However, the funds may have utilized their overdraft facility and incurred interest expense, which is disclosed in the Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2013, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Schwab Target 2010 Fund		$6,280,000		$8,430,000
Schwab Target 2015 Fund		15,900,000		6,150,000
Schwab Target 2020 Fund		58,370,000		31,200,000
Schwab Target 2025 Fund		49,445,000		12,195,000
Schwab Target 2030 Fund		73,980,000		33,915,000
Schwab Target 2035 Fund		32,860,000		5,015,000
Schwab Target 2040 Fund		66,393,000		16,130,000
Schwab Target 2045 Fund		3,874,305		56,561
Schwab Target 2050 Fund		3,130,852		5,000
Schwab Target 2055 Fund		2,440,722		6,000

8. Redemption Fee:

The funds charge a 2.00% redemption fee on shares sold or exchanged within 30 days of the original purchase date. Such amounts are netted against redemption proceeds in the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

	Current Period		Prior Period
	(11/1/12-4/30/13)		(11/1/11-10/31/12)
Schwab Target 2010 Fund		$1,223		$1,527
Schwab Target 2015 Fund		799		3,540
Schwab Target 2020 Fund		1,099		1,559
Schwab Target 2025 Fund		18,266		7,669
Schwab Target 2030 Fund		8,918		9,707
Schwab Target 2035 Fund		917		2,370
Schwab Target 2040 Fund		13,094		13,870
Schwab Target 2045 Fund*		215		—
Schwab Target 2050 Fund*		24		—
Schwab Target 2055 Fund*		88		—

* Since commencement of operations 1/23/13

96 

 Schwab Target Funds

Financial Notes, unaudited (continued)

9. Federal Income Taxes:

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of October 31, 2012, the following funds had capital loss carryforwards available to offset future net capital gains before the expiration dates as follows:

	Schwab		Schwab		Schwab		Schwab		Schwab		Schwab		Schwab
	Target		Target		Target		Target		Target		Target		Target
	2010		2015		2020		2025		2030		2035		2040
Expiration Date	Fund		Fund		Fund		Fund		Fund		Fund		Fund
October 31, 2016		$4,601,462		$—		$9,049,980		$—		$6,715,916		$—		$6,366,179
October 31, 2017		13,259,379		440,793		26,262,598		627,208		21,027,180		468,050		15,004,416
October 31, 2018		—		—		1,839,068		—		890,126		—		475,341
October 31, 2019		—		—		—		—		205,693		—		51,729
No expiration*		—		—		—		146,556		1,416,200		130,468		1,587,618
Total		$17,860,841		$440,793		$37,151,646		$773,764		$30,255,115		$598,518		$23,485,283

* As a result of the passage of the Regulated Investment Company Modernization Act of 2010, capital losses incurred after December 31, 2010 may now be carried forward indefinitely, but must retain the character of the original loss. However, such losses must be utilized prior to the pre-enactment capital losses, which may increase the likelihood that the pre-enactment capital losses may expire unused. Under pre-enactment law, capital losses could be carried forward for eight years, and carried forward as short-term capital loss, irrespective of the character of the original loss.

For the year ended October 31, 2012, the funds had capital losses utilized as follows:

Schwab

Schwab

Schwab

Schwab

Schwab

Schwab

Schwab

Target

Target

Target

Target

Target

Target

Target

2010

2015

2020

2025

2030

2035

2040

Fund

Fund

Fund

Fund

Fund

Fund

Fund

Capital losses utilized

$1,614,007

$134,139

$765,836

$—

$—

$—

$—

As of October 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended October 31, 2012, the funds did not incur any interest or penalties.

10. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

97

Investment Advisory Agreement Approval

Initial Approval of Investment Advisory Agreement

The Board of Trustees (the “Board” or the “Trustees”, as appropriate) called and held a meeting on December 4, 2012, in part, for the purpose of considering whether to appoint Charles Schwab Investment Management, Inc. (“CSIM”) as investment adviser to Schwab Target 2045 Fund, Schwab Target 2050 Fund and Schwab Target 2055 Fund (each, a “Fund” and collectively, the “Funds”) under the investment advisory agreement between Schwab Capital Trust (the “Trust”) and CSIM (the “Agreement”). In preparation for the meeting, the Board reviewed a variety of materials provided by CSIM with respect to the services to be provided to the Funds under the Agreement. In recognition of the fact that the Funds had not yet commenced operations, the Board also took into account the detailed information about other funds within the Trust that the Board reviews during the course of each year, including information that relates to fund operations and fund performance. The Independent Trustees receive advice from independent counsel to the Independent Trustees. In addition, the Independent Trustees met in executive session outside the presence of fund management and participated in question and answer sessions with representatives of CSIM.

At the meeting on December 4, 2012, the Board, including a majority of the Independent Trustees, approved the Agreement with respect to the Funds. The Board’s approval was based on consideration and evaluation of a variety of specific factors discussed at this meeting and/or prior meetings of the Board, including:

1.	the nature, extent and quality of the services to be provided to the Funds under the Agreement, including the resources CSIM and its affiliates will dedicate to the Funds;
2.	CSIM’s investment performance in managing other funds having relevant investment objectives and strategies;
3.	the Funds’ estimated expenses and how those expenses compare to those of certain other comparable mutual funds;
4.	the profitability of CSIM and its affiliates, including Charles Schwab & Co., Inc. (“Schwab”), with respect to management of other similar funds, including both direct and indirect benefits accruing to CSIM and its affiliates; and
5.	the extent to which economies of scale would be realized as the Funds grow and whether fee levels in the Agreement relating to the Funds reflect those economies of scale for the benefit of Fund investors.

Nature, Extent and Quality of Services. The Board considered the nature, extent and quality of the services to be provided by CSIM to the Funds and the resources CSIM and its affiliates will dedicate to the Funds. In this regard, the Trustees evaluated, among other things, CSIM’s personnel, experience, track record and compliance program. The Trustees also considered Schwab’s wide range of products, services and channel alternatives such as free advice, investment research tools and Internet access and an array of account features that may be expected to benefit the Funds and their shareholders. Following such evaluation, the Board concluded, within the context of its full deliberations that the nature, extent and quality of services to be provided by CSIM to the Funds and the resources CSIM and its affiliates will dedicate to the Funds supported approval of the Agreement with respect to the Funds.

Performance. With regard to Fund performance, since the Funds had not commenced operations and therefore did not have any performance of their own, the Board considered performance of other funds advised by CSIM having comparable investment objectives in determining whether to approve the Agreement with respect to the Funds. The Trustees also considered both risk and shareholder risk expectations for the Funds. Following such evaluation the Board concluded, within the context of its full deliberations, that the performance of CSIM supported approval of the Agreement with respect to the Funds.

Fund Expenses. With respect to the Funds’ expenses, the Trustees considered the rate of compensation called for by the Agreement, and the Funds’ estimated net operating expense ratio in comparison to those of other comparable mutual funds. The Trustees also considered CSIM and Schwabs’ commitment to waive fees to prevent total Fund expenses from exceeding a specified cap. The Trustees also considered CSIM’s contractual commitment to keep each Fund’s expense cap for so long as CIMS serves as the adviser to such Fund. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the expenses of the Funds are reasonable and supported approval of the Agreement with respect to the Funds.

Profitability. With regard to profitability, the Trustees considered the compensation flowing to CSIM and its affiliates directly or indirectly. The Trustees also considered any other benefits to be derived by CSIM from its relationship with the Funds. The Trustees considered whether the compensation and profitability under the Agreement and other service agreements were reasonable and justified in light of the quality of all services rendered to the Funds by CSIM and its affiliates. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the expected profitability of CSIM, albeit uncertain, is reasonable and supported approval of the Agreement with respect to the Funds.

98 

Economies of Scale. Recognizing that the Funds had not yet commenced operations and had no assets, the Trustees considered the possible development of any economies of scale through various efficiencies that may result from increases in the Funds’ assets and whether those could be expected to be passed along to the Funds’ shareholders. Based on this evaluation, the Board concluded, within the context of its full deliberations, that the Funds may be expected to obtain reasonable benefit from economies of scale if such economies develop.

In the course of their deliberations, the Trustees did not identify any particular information or factor that was all important or controlling. Based on the Trustees’ deliberation and their evaluation of the information described above, the Board, including a majority of the Independent Trustees, unanimously approved the Agreement as it relates to the Funds and concluded that the compensation under the Agreement relating to the Funds is fair and reasonable in light of such services and expenses and such other matters as the Trustees have considered to be relevant in the exercise of their reasonable judgment.

99

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Capital Trust, which includes the funds covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The Fund Complex includes 94 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the funds’ Statement of Additional Information, which is available free by calling 1-800-435-4000.

 Independent Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Mariann Byerwalter 1960 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman of JDN Corporate Advisory LLC (advisory services firm) (Oct. 2001 – present).	77	Director,WageWorks, Inc. (2010 – present) Director, Redwood Trust, Inc. (1998 – present) Director, PMI Group Inc. (2001 – 2009)
John F. Cogan 1947 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research; Professor of Public Policy, Stanford University (Sept. 2000 – present).	77	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
William A. Hasler 1941 Trustee (Trustee of Schwab Capital Trust since 2000.)	Dean Emeritus, Haas School of Business, University of California, Berkeley (July 1998 – present).	77	Director, TOUSA (1998 – present) Director, Globalstar, Inc. (2009 – present) Director, Aviat Networks (2001 – present) Director, Mission West Properties (1998 – 2012) Director, Ditech Networks Corporation (1997 – 2012) Director, Genitope Corporation (2000 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	77	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Tercica Inc. (2004 – 2008)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – present); Senior Vice President and General Manager of Consumer Group, Intuit, Inc. (June 2007 – Dec. 2008); Senior Vice President and Chief Financial Officer, Intuit, Inc. (Sept. 2005 – Jan. 2008).	77	Director, KLA-Tencor Corporation (2008 – present) Director, BEA Systems, Inc. (2007 – 2008)
Gerald B. Smith 1950 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (1990 – present).	77	Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – present) Director, Oneok, Inc (2009 – present) Lead Independent Director, Board of Cooper Industries (2002 – 2012)

100 

 Independent Trustees (continued)

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (Jan. 2008- present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	77	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

 Interested Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served )	During the Past Five Years	the Trustee	Other Directorships
Charles R. Schwab2 1937 Chairman and Trustee (Chairman and Trustee of Schwab Capital Trust since 1993.)	Chairman and Director, The Charles Schwab Corporation, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc., Charles Schwab Bank, N. A.; Chairman and Chief Executive Officer, Schwab (SIS) Holdings Inc. I, Schwab International Holdings, Inc.; Chief Executive Officer, Schwab Holdings, Inc.; Through June 2007, Director, U.S. Trust Company, N. A., U.S. Trust Corporation, United States Trust Company of New York. Until October 2008, Chief Executive Officer, The Charles Schwab Corporation, Charles Schwab & Co., Inc.	77	None
Walter W. Bettinger II2 1960 Trustee (Trustee of Schwab Capital Trust since 2008.)	As of October 2008, President and Chief Executive Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. Since October 2008, Director, The Charles Schwab Corporation. Since May 2008, Director, Charles Schwab & Co., Inc. and Schwab Holdings, Inc. Since 2006, Director, Charles Schwab Bank. Until October 2008, President and Chief Operating Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. From 2004 through 2007, Executive Vice President and President, Schwab Investor Services. From 2004 through 2005, Executive Vice President and Chief Operating Officer, Individual Investor Enterprise, and from 2002 through 2004, Executive Vice President, Corporate Services.	94	None

 Officers of the Trust

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
Marie Chandoha 1961 President and Chief Executive Officer (Officer of Schwab Capital Trust since 2010.)	Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President and Chief Executive Officer (Dec. 2010 – present) and Chief Investment Officer (Dec. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 2007 – August 2010).

101

 Officers of the Trust (continued)

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
George Pereira 1964 Treasurer and Principal Financial Officer (Officer of Schwab Capital Trust since 2004.)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab Asset Management (Ireland) Limited (April 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 2011 – present); Senior Managing Director, Global Head of Active Fixed-Income Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head of Market-Based Strategies, State Street Research (August 2003 – Jan. 2005).
David Lekich 1964 Secretary and Chief Legal Officer (Officer of Schwab Capital Trust since 2011.)	Senior Vice President (Sept. 2011 – present), Vice President (March 2004 – Sept. 2011), Charles Schwab & Co., Inc.; Senior Vice President and Chief Counsel (Sept. 2011 – present), Vice President (Jan. 2011 – Sept. 2011), Charles Schwab Investment Management, Inc.; Secretary (April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President (Officer of Schwab Capital Trust since 2005.)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant Secretary, Schwab ETFs (Oct. 2009 – present).

1	Trustees remain in office until they resign, retire or are removed by shareholder vote. The Schwab Funds® retirement policy requires that independent trustees elected after January 1, 2000 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the Schwab Funds retirement policy also requires any independent trustee of the Schwab Funds who also serves as an independent trustee of the Laudus Funds to retire from the Boards of the Schwab Funds upon their required retirement date from either the Boards of Trustees of the Schwab Funds or the Laudus Funds, whichever comes first.
2	Mr. Schwab and Mr. Bettinger are Interested Trustees because they are employees of Schwab. In addition to their employment with Schwab, Messrs. Schwab and Bettinger also own stock of The Charles Schwab Corporation, the parent company of Schwab and the investment adviser.
3	The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

102 

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.

Barclays U.S. Aggregate Bond Index A broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-back securities (agency fixed-rate and hybrid ARM passthroughs), asset-backed securities, and commercial mortgage-backed securities.

Barclays U.S. Aggregate Intermediate Bond Index An index that measures the intermediate-term investment grade, U.S. dollar-denominated, fixed-rate taxable bond market.

Barclays U.S. Government/Credit: 1 − 5 Years Index An index that includes investment-grade government and corporate bonds that are denominated in U.S. dollars and have maturities of one to five years. Bonds are represented in the index in proportion to their market value.

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.”

An individual bond is subject to the credit risk of the issuer. Changes in interest rates can affect a bond’s market value prior to call or maturity. There is no guarantee that a bond’s yield to call or maturity will provide a positive return over the rate of inflation.

bond fund A bond fund is subject to the same credit, interest rate, and inflation risks as bonds. In addition, a bond fund incurs ongoing fees and expenses. A bond fund’s net asset value will fluctuate with the price of the underlying bonds and the portfolio turnover activity; return of principal is not guaranteed.

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.

Citigroup Non-U.S. Dollar World Government Bond Index An index that measures the total rate of return performance for the government bonds of 23 countries, excluding the U.S., with a remaining maturity of at least one year.

Dow Jones U.S. Total Stock Market Index An index that measures the performance of all U.S. equity securities with readily available prices.

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.

MSCI EAFE Index A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada.

MSCI Emerging Markets Index A free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets.

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.

Russell 1000 Index An index that measures the performance of the large-cap segment of the U.S. equity universe.

Russell 2000 Index An index that measures the performance of the small-cap segment of the U.S. equity universe.

S&P 500 Index A market capitalization index that is designed to measure the performance of 500 leading publicly held companies in leading industries of the U.S. economy.

stock A share of ownership, or equity, in the issuing company.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

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.

103

Notes

Notes

Notes

Schwab Funds^® offers you an extensive family of mutual funds, each one based on a clearly defined investment approach and using disciplined management strategies. The list at right shows all currently available Schwab Funds.

Whether you are an experienced investor or just starting out, Schwab Funds can help you achieve your financial goals. An investor should consider a fund’s investment objectives, risks, charges and expenses carefully before investing or sending money. This and other important information can be found in the fund’s prospectus. Please call 1-800-435-4000 for a prospectus and brochure for any Schwab Fund. Please read the prospectus carefully before you invest. This report must be preceded or accompanied by a current prospectus.

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting Schwab’s website at www.schwabfunds.com/prospectus, the SEC’s website at http://www.sec.gov, or by contacting Schwab Funds at 1-800-435-4000.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.schwabfunds.com/prospectus or the SEC’s website at http://www.sec.gov.

The Schwab Funds Family^®

Stock Funds

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core Equity Fund

Schwab Fundamental US Large Company Index Fund

Schwab Fundamental US Small Company Index Fund

Schwab Fundamental International Large Company Index Fund

Schwab Fundamental International Small Company Index Fund

Schwab Fundamental Emerging Markets Large Company Index Fund

Schwab Global Real Estate Fund^tm

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market Index Fund^®

Schwab International Index Fund^®

Asset Allocation Funds

Schwab Balanced Fund^tm

Schwab MarketTrack All Equity Portfolio^tm

Schwab MarketTrack Growth Portfolio^tm

Schwab MarketTrack Balanced Portfolio^tm

Schwab MarketTrack Conservative Portfolio^tm

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

Schwab^® Monthly Income Fund – Moderate Payout

Schwab^® Monthly Income Fund – Enhanced Payout

Schwab^® Monthly Income Fund – Maximum Payout

Bond Funds

Schwab Short-Term Bond Market Fund^tm

Schwab Intermediate-Term Bond Fund^tm

Schwab Total Bond Market Fund^tm

Schwab GNMA Fund^tm

Schwab^® Treasury Inflation Protected Securities Index Fund

Schwab Tax-Free Bond Fund^tm

Schwab California Tax-Free Bond Fund^tm

Schwab Money Funds

Schwab offers an array of money market funds¹. Choose from taxable or tax-advantaged alternatives. Many can be linked to your eligible Schwab account to “sweep” cash balances automatically, subject to availability, when you’re between investments. Or, for your larger cash reserves, choose one of our Value Advantage Investments^®.

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.

Investment Adviser

Charles Schwab Investment Management, Inc.

211 Main Street, San Francisco, CA 94105

Funds

Schwab Funds^®

P.O. Box 3812, Englewood, CO 80155–3812

This report is not authorized for distribution to prospective investors

unless preceded or accompanied by a current prospectus.

^© 2013 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR34720-07

00098635

Semiannual report dated April 30, 2013, enclosed.

Schwab Balanced Fund^tm

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by viewing these documents online.

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This wrapper is not part of the shareholder report.

Schwab Balanced Fund^tm

Semiannual Report

April 30, 2013

This page is intentionally left blank.

Schwab Balanced Fund^tm

In This Report

Performance at a Glance	2
From the President	3
Fund Management	5
Performance and Fund Facts	6
Fund Expenses	7
Financial Statements and Portfolio Holdings	8
Financial Notes	13
Trustees and Officers	20
Glossary	23

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM).
Distributor: Charles Schwab & Co., Inc. (Schwab).

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 2013
Schwab Balanced Fundtm(Ticker Symbol: SWOBX)	8.40%
Balanced Blended Index	8.87%
Fund Category: Morningstar Moderate Allocation	9.17%
Performance Details	page 6

Minimum Initial Investment¹ $ 100

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a fund’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

The Balanced Blended Index is a custom blended index developed by CSIM composed of 60% S&P 500^® Index and 40% Barclays U.S. Aggregate Bond Index. The components that make up the composite index may vary over time.

¹ Please see the fund’s prospectus for further detail and eligibility requirements.

2 Schwab Balanced Fund

From the President

Marie Chandoha is President and CEO of Charles Schwab Investment Management, Inc. and the fund covered in this report.

Dear Shareholder,

As President and CEO of Charles Schwab Investment Management, Inc., I’d like to thank you for trusting us to help you meet your investment goals, and for reading this important report concerning the Schwab Balanced Fund. The fund combines equity and fixed income strategies in U.S. markets, and is designed to provide income, diversification, and an opportunity for long-term growth.

For the six months ended April 30, 2013, the fund’s return reflected a strong rally by U.S. stocks combined with low returns by bonds. The backdrop for these performances included efforts undertaken by the Federal Reserve and many central banks around the world to stimulate faster economic growth by keeping interest rates low. In general, stocks benefited from these efforts and from reduced investor concerns regarding the euro zone’s sovereign debt crisis and the fiscal cliff. Some signs of improvement in the housing market also helped stocks. Many major stock market indices finished at or near record highs, with the S&P 500 Index returning 14.4%.

The generally healthier economic environment and low level of interest rates led to subdued performances by fixed income securities for the report period. Bonds with lower credit ratings outperformed Treasuries as credit conditions improved, while intermediate-term bonds generally provided the highest returns. In this environment, the Barclays U.S. Aggregate Bond Index—broadly reflecting the U.S. bond market—returned 0.9%.

 Asset Class Performance Comparison % returns during the report period

This graph compares the performance of various asset classes during the report period. Final performance figures for the period are in the key below.

	14.42%	S&P 500® Index: measures U.S. large-cap stocks
	16.58%	Russell 2000® Index: measures U.S. small-cap stocks
	17.18%	MSCI EAFE® Index (Gross): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	0.90%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.04%	Three-Month U.S. Treasury Bills (T-bills): measures short-term U.S. Treasury obligations

Index figures assume dividends and distributions were reinvested, and do not include trading and management costs, which would lower performance. Indices are unmanaged, do not incur management fees, costs and expenses, and you cannot invest in them directly. Remember that past performance is not an indication of future results.

Data source: Index provider websites and CSIM.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views and portfolio holdings may have changed since the report date.

Schwab Balanced Fund 3

From the President continued

For the six months ended April 30, 2013, the fund’s return reflected a strong rally by U.S. stocks combined with low returns by bonds.

For more information about the Schwab Balanced Fund, please continue reading this report. In addition, you can find answers to frequently asked questions and more details about the fund by visiting www.schwabfunds.com. We are also happy to hear from you at 1-800-435-4000.

Sincerely,

4 Schwab Balanced Fund

Fund Management

Zifan Tang, CFA, Managing Director and Head of Asset Allocation Strategies, leads the portfolio management team and has overall responsibility for all aspects of the management of the fund. She was appointed portfolio manager of the fund in February 2012. Prior to joining CSIM in 2012, Ms. Tang was a product manager at Thomson Reuters and, from 1997 to 2009, worked as a portfolio manager at Barclays Global Investors, which was subsequently acquired by BlackRock.

Schwab Balanced Fund 5

Schwab Balanced Fund™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Fund and Inception Date	6 Months			1 Year			5 Years			10 Years
Fund: Schwab Balanced Fundtm (11/18/96)		8.40	%		9.10	%		5.11	%		6.67	%
Balanced Blended Index3		8.87	%		11.59	%		5.87	%		7.03	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.04	%
Fund Category: Morningstar Moderate Allocation		9.17	%		11.16	%		4.43	%		6.79	%

Fund Expense Ratios⁴: Net 0.65%; Gross 0.81%

 Statistics

Number of Holdings	6
Portfolio Turnover Rate5	9%

 Asset Class Weightings % of Investments

Equity Funds – Large-Cap	51.4%
Fixed-Income Funds – Intermediate-Term Bond	36.0%
Equity Funds – Small-Cap	9.8%
Money Market Funds	2.8%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Core Equity Fund	35.7%
Schwab Total Bond Market Fund	23.7%
Laudus Growth Investors U.S. Large Cap Growth Fund	15.6%
Schwab Intermediate-Term Bond Fund	12.2%
Laudus Small-Cap MarketMasters Fund, Select Shares	9.8%
Total	97.0%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Because the fund originally used a different asset allocation strategy and a multi-fund strategy, its performance prior to June 3, 2002 does not reflect the current strategy and may have been different if it did. From June 3, 2002 to February 28, 2008, the fund used a manager of managers strategy, and therefore its performance during this time does not reflect the fund’s current multi-fund strategy and may have been different if it did.

Portfolio holdings may have changed since the report date.

Small-company stocks are subject to greater volatility than other asset classes.

The Laudus Growth Investors U.S. Large Cap Growth Fund is part of Laudus Trust and distributed by ALPS Distributors, Inc. The Laudus MarketMasters Funds are part of Schwab Capital Trust and distributed by Charles Schwab & Co., Inc.

1	Fund expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, the fund’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Balanced Blended Index is a custom blended index developed by CSIM composed of 60% S&P 500® Index and 40% Barclays U.S. Aggregate Bond Index. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the fund invests. The annualized weighted average expense ratio of the underlying funds was 0.65%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

6 Schwab Balanced Fund

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you incur two types of costs: transaction costs, such as redemption fees, and ongoing costs, such as management fees, transfer agent and shareholder services fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in a fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning November 1, 2012 and held through April 30, 2013.

Actual Return lines in the table below provide information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ¸ $1,000 = 8.6), then multiply the result by the number given for your fund or share class under the heading entitled “Expenses Paid During Period.”

Hypothetical Return lines in the table below provide information about hypothetical account values and hypothetical expenses based on a fund’s or share class’ actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as redemption fees. If these transactional costs were included, your costs would have been higher.

					Ending
			Beginning		Account Value		Expenses Paid
	Expense Ratio1		Account Value		(Net of Expenses)		During Period2
	(Annualized)		at 11/1/12		at 4/30/13		11/1/12–4/30/13
Schwab Balanced Fundtm
Actual Return		0.00%	$	1,000	$	1,084.00	$	0.00
Hypothetical 5% Return		0.00%	$	1,000	$	1,024.79	$	0.00

1	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights. The expenses incurred by the underlying funds in which the funds invest are not included in this ratio.
2	Expenses for the fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year.

Schwab Balanced Fund 7

Schwab Balanced Fund™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/081
Per-Share Data ($)
Net asset value at beginning of period		12.51			11.61			11.00			9.99			9.82			13.86
Income (loss) from investment operations:
Net investment income (loss)		0.09	2		0.19	2		0.17	2		0.17	2		0.22	2		0.20	2
Net realized and unrealized gains (losses)		0.95			0.88			0.63			1.03			0.64			(3.26	)
Total from investment operations		1.04			1.07			0.80			1.20			0.86			(3.06	)
Less distributions:
Distributions from net investment income		(0.22	)		(0.17	)		(0.19	)		(0.19	)		(0.37	)		(0.29	)
Distributions from net realized gains		—			—			—			—			(0.32	)		(0.69	)
Total distributions		(0.22	)		(0.17	)		(0.19	)		(0.19	)		(0.69	)		(0.98	)
Net asset value at end of period		13.33			12.51			11.61			11.00			9.99			9.82
Total return (%)		8.40	3		9.36			7.28			12.08			9.45			(23.56	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses4		0.00	5,6		0.00	6		0.00	6		0.00	6		0.00			0.36
Gross operating expenses4		0.11	5		0.16			0.16			0.20			0.17			0.53
Net investment income (loss)		1.43	5		1.54			1.52			1.67			2.41			1.81
Portfolio turnover rate		9	3		38			53			8			21			267
Net assets, end of period ($ x 1,000,000)		146			117			109			88			86			85

* Unaudited.

¹ Effective February 28, 2008, the Investor Share class and the Select Share class were combined into a single class of shares of the fund. The financial history as shown in the financial highlights is that of the former Investor Shares.

² Calculated based on the average shares outstanding during the period.

³ Not annualized.

⁴ The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

⁵ Annualized.

⁶ Less than 0.005%; the ratio of net operating expenses would have been 0.00%, if certain non-routine expenses had not been incurred.

8 See financial notes

 Schwab Balanced Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	99	.8%	Other Investment Companies		125,269,113		145,904,031
	99	.8%	Total Investments		125,269,113		145,904,031
	0	.2%	Other Assets and Liabilities, Net				313,257
	100	.0%	Net Assets				146,217,288

	Number		Value
Security	of Shares		($)
Other Investment Companies 99.8% of net assets
Equity Funds 61.1%
Large-Cap 51.3%
Laudus Growth Investors U.S. Large Cap Growth Fund (a)		1,455,314		22,848,432
Schwab Core Equity Fund (a)		2,465,980		52,180,129
				75,028,561
Small-Cap 9.8%
Laudus Small-Cap MarketMasters Fund, Select Shares (a)*		938,083		14,258,859
				89,287,420
Fixed-Income Funds 35.9%
Intermediate-Term Bond 35.9%
Schwab Intermediate-Term Bond Fund (a)		1,717,098		17,874,991
Schwab Total Bond Market Fund (a)		3,573,974		34,667,543
				52,542,534
Money Market Fund 2.8%
State Street Institutional U.S. Government Money Market Fund		4,074,077		4,074,077
Total Other Investment Companies
(Cost $125,269,113)				145,904,031
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $127,617,340 and the unrealized appreciation and depreciation were $18,286,691 and ($0), respectively, with a net unrealized appreciation of $18,286,691.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$145,904,031		$—		$—		$145,904,031
Total		$145,904,031		$—		$—		$145,904,031

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 9

 Schwab Balanced Fund

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $121,195,036)		$141,829,954
Investments in unaffiliated issuers, at value (cost $4,074,077)	+	4,074,077
Total investments, at value (cost $125,269,113)		145,904,031
Receivables:
Fund shares sold		570,120
Dividends		87,974
Due from investment adviser		857
Interest		39
Prepaid expenses	+	1,908
Total assets		146,564,929
Liabilities
Payables:
Investments bought		150,000
Fund shares redeemed		139,431
Accrued expenses	+	58,210
Total liabilities		347,641
Net Assets
Total assets		146,564,929
Total liabilities	−	347,641
Net assets		$146,217,288
Net Assets by Source
Capital received from investors		131,492,172
Distributions in excess of net investment income		(37,390	)
Net realized capital losses		(5,872,412	)
Net unrealized capital gains		20,634,918
Net Asset Value (NAV)

��		Shares
Net Assets	÷	Outstanding	=	NAV
$146,217,288		10,970,430			$13.33

10 See financial notes

 Schwab Balanced Fund

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$877,131
Interest	+	22,686
Total investment income		899,817
Expenses
Professional fees		20,021
Shareholder reports		13,529
Registration fees		11,968
Transfer agent fees		11,630
Portfolio accounting fees		8,630
Trustees’ fees		3,228
Custodian fees		1,679
Interest expense		25
Other expenses	+	1,351
Total expenses		72,061
Expense reduction by CSIM	−	72,036
Custody credits	−	5
Net expenses	−	20
Net investment income		899,797
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		560,503
Net realized losses on sales of affiliated underlying funds		(141,234	)
Net realized gains on unaffiliated investments	+	2
Net realized gains		419,271
Net unrealized gains on affiliated underlying funds	+	8,888,026
Net realized and unrealized gains		9,307,297
Increase in net assets resulting from operations		$10,207,094

See financial notes 11

 Schwab Balanced Fund

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$899,797			$1,646,969
Net realized gains (losses)		419,271			(417,870	)
Net unrealized gains	+	8,888,026			7,101,600
Increase in net assets from operations		10,207,094			8,330,699
Distributions to Shareholders
Distributions from net investment income		($1,969,000	)		($1,421,426	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			2,879,188		$37,075,749			4,301,668		$52,887,809
Shares reinvested			148,002		1,838,191			115,862		1,332,417
Shares redeemed	+		(1,441,627	)	(18,348,137	)		(4,446,198	)	(53,006,629	)
Net transactions in fund shares			1,585,563		$20,565,803			(28,668	)	$1,213,597
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			9,384,867		$117,413,391			9,413,535		$109,290,521
Total increase or decrease	+		1,585,563		28,803,897			(28,668	)	8,122,870
End of period			10,970,430		$146,217,288			9,384,867		$117,413,391
(Distributions in excess of net investment income)/Net investment income not yet distributed					($37,390	)				$1,031,813

12 See financial notes

 Schwab Balanced Fund

Financial Notes, unaudited

1. Business Structure of the Fund:

Schwab Balanced Fund is a series of Schwab Capital Trust (the “trust”), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trust as of the end of the period, including the fund discussed in this report, which is highlighted:

Schwab Capital Trust (organized May 7, 1993)	Schwab International Core Equity Fund
Schwab Balanced Fund	Schwab Target 2010 Fund
Schwab S&P 500 Index Fund	Schwab Target 2015 Fund
Schwab Small-Cap Index Fund	Schwab Target 2020 Fund
Schwab Total Stock Market Index Fund	Schwab Target 2025 Fund
Schwab International Index Fund	Schwab Target 2030 Fund
Schwab MarketTrack All Equity Portfolio	Schwab Target 2035 Fund
Schwab MarketTrack Growth Portfolio	Schwab Target 2040 Fund
Schwab MarketTrack Balanced Portfolio	Schwab Target 2045 Fund
Schwab MarketTrack Conservative Portfolio	Schwab Target 2050 Fund
Laudus Small-Cap MarketMasters Fund	Schwab Target 2055 Fund
Laudus International MarketMasters Fund	Schwab Fundamental US Large Company Index Fund
Schwab Core Equity Fund	Schwab Fundamental US Small Company Index Fund
Schwab Dividend Equity Fund	Schwab Fundamental International Large Company Index Fund
Schwab Large-Cap Growth Fund	Schwab Fundamental International Small Company Index Fund
Schwab Small-Cap Equity Fund	Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab Hedged Equity Fund	Schwab Monthly Income Fund - Moderate Payout
Schwab Financial Services Fund	Schwab Monthly Income Fund - Enhanced Payout
Schwab Health Care Fund	Schwab Monthly Income Fund - Maximum Payout

The Schwab Balanced Fund is a single class “fund of funds” which seeks to achieve its investment objective by investing in a diversified group of other Schwab and/or Laudus Funds, but also may invest in other unaffiliated, third party mutual funds, including exchange traded funds (“ETFs”). In addition, the fund may purchase individual securities to maintain its allocations. The fund bears its share of allocable expenses of the underlying funds in which it invests. The financial statements of the fund should be read in conjunction with the underlying funds’ financial statements.

The fund offers one share class. Shares are bought and sold (subject to a redemption fee, see financial note 8) at closing net asset value per share (“NAV”), which is the price for all outstanding shares of the fund. Each share has a par value of 1/1,000 of a cent, and the fund’s Board of Trustees (the “Board”) may authorize the issuance of as many shares as necessary.

The fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax purposes. Within its account, the fund may also keep certain assets in segregated accounts, as required by securities law.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the fund uses in its preparation of financial statements. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the Securities Exchange Commission (“SEC”).

(a) Security Valuation:

Under procedures approved by the Board, the investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

The fund values the securities in its portfolio every business day. The fund uses the following policies to value various types of securities:

•  Underlying funds: Mutual funds are valued at their respective net asset values.

•  Securities for which no quoted value is available: The Board has adopted procedures to fair value the fund’s securities when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is

13

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. The fund makes fair value determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ techniques such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing Committee regularly reviews these inputs and assumptions to calibrate the valuations. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security. The Board convenes on a regular basis to review fair value determinations made by the fund pursuant to the valuation procedures.

•  Short-term securities (60 days or less to maturity): Short-term securities are valued at amortized cost, which approximates market value.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the fund discloses the fair value of its investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If the fund determines that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

•  Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities. Investments in mutual funds are valued daily at their NAVs, which are classified as Level 1 prices.

•  Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. As investments whose values are classified as Level 2 prices include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

•  Level 3 — significant unobservable inputs (including the fund’s own assumption in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not available for these securities, the fund uses one or more valuation techniques for which sufficient and reliable data is available. The inputs used by the fund in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the fund in the absence of market information. Assumptions used by the fund due to the lack of observable inputs may significantly impact the resulting fair value and therefore the fund’s results of operations.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the fund’s investments as of April 30, 2013 are disclosed in the Portfolio Holdings.

14 

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

(b) Security Transactions:

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains or losses from security transactions are based on the identified costs of the securities involved.

(c) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds are recorded on the date they are effective (the ex-dividend date), although the fund records certain foreign security dividends on the day it learns of the ex-dividend date. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

(d) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within the trust generally are allocated among the funds in proportion to their average daily net assets.

(e) Distributions to Shareholders:

The fund declares distributions from net investment income and net realized capital gains, if any, once a year.

(f) Custody Credit:

The fund has an arrangement with its custodian bank, State Street Bank and Trust Company (“State Street’), under which the fund may receive a credit for its uninvested cash balance to offset its custody fees and accounting fees. The credit amounts, if any, are disclosed in the Statement of Operations as a reduction to the fund’s operating expenses.

(g) Accounting Estimates:

The accounting policies described in this report conform to GAAP. 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 and these differences may be material.

(h) Federal Income Taxes:

The fund intends to meet federal income and excise tax requirements for regulated investment companies. Accordingly, the fund distributes substantially all of its net investment income and realized net capital gains, if any, to its respective shareholders each year. As long as a fund meets the tax requirements, it is not required to pay federal income tax.

(i) Indemnification:

Under the fund’s organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business the fund enters into contracts with its vendors and others that provide general indemnifications. The fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the fund. However, based on experience, the fund expects the risk of loss attributable to these arrangements to be remote.

(j) New Accounting Pronouncements:

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative instruments. Management is currently evaluating the impact the adoption of ASU No. 2011-11 may have on the fund’s financial statement disclosures.

15

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

3. Risk Factors:

Investing in the fund may involve certain risks, as discussed in the fund’s prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Asset Allocation Risk. The fund is subject to asset allocation risk, which is the risk that the selection of the underlying funds and the allocation of the fund’s assets among the various asset classes and market segments will cause the fund to underperform other funds with a similar investment objective.

Affiliated Fund Risk. The investment adviser’s authority to select and substitute underlying funds from a variety of affiliated and unaffiliated mutual funds may create a conflict of interest because the fees paid to it by some underlying funds are higher than the fees paid by other underlying funds. However, the portfolio manager is a fiduciary to the fund and is legally obligated to act in the fund’s best interests when selecting underlying funds, without taking fees into consideration.

Market Risk. Equity and fixed income markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of an investment in the fund will fluctuate, which means that an investor could lose money.

Underlying Fund Investment Risk. The value of an investment in the fund is based primarily on the prices of the underlying funds that the fund purchases. In turn, the price of each underlying fund is based on the value of its securities. Before investing in the fund, investors should assess the risks associated with the underlying funds in which the fund may invest and the types of investments made by those underlying funds. These risks include any combination of the risks described below, although the fund’s exposure to a particular risk will be proportionate to the fund’s overall asset allocation and underlying fund allocation.

•  Investment Risk. An investment in an underlying fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund may experience losses with respect to its investment in an underlying fund. Further, there is no guarantee that an underlying fund will be able to achieve its objective.

•  Management Risk. The underlying funds are actively managed mutual funds. Any actively managed mutual fund is subject to the risk that its investment adviser (or sub-adviser(s)) will make poor security selections. An underlying fund’s adviser applies its own investment techniques and risk analyses in making investment decisions for the fund, but there can be no guarantee that they will produce the desired results.

•  Equity Risk. The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

•  Large- and Mid-Cap Risk. Both large- and mid-cap stocks tend to go in and out of favor based on market and economic conditions. However, stocks of mid-cap companies tend to be more vulnerable to adverse business or economic events than larger more established companies. During a period when large- and mid-cap U.S. stocks fall behind other types of investments - small-cap stocks, for instance - an underlying fund’s large- and mid-cap holdings could reduce performance.

•  Small-Cap Risk. Historically, small-cap stocks have been riskier than large- and mid-cap stocks, and their prices may move sharply, especially during market upturns and downturns. Small-cap companies may be more vulnerable to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall behind other types of investments - large-cap and mid-cap stocks, for instance - an underlying fund’s small-cap holdings could reduce performance.

•  Growth Investing Risk. An underlying fund’s investments in growth stocks can be volatile. Growth companies usually invest a high portion of earnings in their businesses and may lack the dividends of value stocks that can cushion stock prices in a falling market. The prices of growth stocks are based largely on projections of the issuer’s future earnings and revenues. If a company’s earnings or revenues fall short of expectations, its stock price may fall dramatically. Growth stocks may also be more expensive relative to their earnings or assets compared to value or other stocks.

•  Fixed Income Risk. Interest rates rise and fall over time, which will affect an underlying fund’s yield and share price. The credit quality of a portfolio investment could also cause an underlying fund’s share price to fall. An underlying fund could lose money if the issuer or guarantor of a portfolio investment or the counterparty to a derivatives contract fails to make timely principal or interest payments or otherwise honor its obligations. Fixed income securities may be paid off earlier or later than expected. Either situation could cause a fund to hold securities paying lower-than-market rates of interest, which could hurt the fund’s yield or share price. Below investment-grade bonds (junk bonds) involve greater credit risk, are more

16 

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

volatile, involve greater risk of price declines and may be more susceptible to economic downturns than investment-grade securities.

•  Exchange-Traded Funds (ETFs) Risk. When an underlying fund invests in an ETF, it will bear a proportionate share of the ETF’s expenses. In addition, lack of liquidity in an ETF can result in its value being more volatile than the underlying portfolio of securities.

•  Foreign Investment Risk. An underlying fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may be heightened in connection with investments in emerging markets.

•  Emerging Markets Risk. Emerging market countries may be more likely to experience political turmoil or rapid changes in market or economic conditions than more developed countries. Such countries often have less uniformity in accounting and reporting requirements and greater risk associated with the custody of securities. In addition, the financial stability of issuers (including governments) in emerging market countries may be more precarious than in other countries. As a result, there will tend to be an increased risk of price volatility associated with an underlying fund’s investments in emerging market countries and, at times, it may be difficult to value such investments.

•  Derivatives Risk. An underlying fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments and could cause the fund to lose more than the principal amount invested. In addition, investments in derivatives may involve leverage, which means a small percentage of assets invested in derivatives can have a disproportionately large impact on an underlying fund. However, these risks are less severe when the underlying fund uses derivatives for hedging rather than to enhance the underlying fund’s returns or as a substitute for a position or security.

•  Leverage Risk. Certain underlying fund transactions, such as derivatives, short sales, reverse repurchase agreements, and mortgage dollar rolls, may give rise to a form of leverage and may expose an underlying fund to greater risk. Leverage tends to magnify the effect of any decrease or increase in the value of an underlying fund’s portfolio securities, which means even a small amount of leverage can have a disproportionately large impact on the fund. The use of leverage may cause the underlying fund to liquidate portfolio positions when it would not be advantageous to do so in order to satisfy its obligations.

•  Liquidity Risk. A particular investment may be difficult to purchase or sell. An underlying fund may be unable to sell illiquid securities at an advantageous time or price.

•  Portfolio Turnover Risk. Certain of the underlying funds may buy and sell portfolio securities actively. If they do, their portfolio turnover rate and transaction costs will rise, which may lower the underlying fund’s performance and may increase the likelihood of capital gain distributions.

•  Securities Lending Risk. Certain underlying funds engage in securities lending, which involves the risk of loss of rights in the collateral or delay in recovery of the collateral if the borrower fails to return the security loaned or becomes insolvent.

•  Mortgage Dollar Rolls Risk. Mortgage dollar rolls are transactions in which an underlying fund sells mortgage-backed securities to a dealer and simultaneously agrees to repurchase similar securities in the future at a predetermined price. An underlying fund’s mortgage dollar rolls could lose money if the price of the mortgage-backed securities sold falls below the agreed upon repurchase price, or if the counterparty is unable to honor the agreement.

Direct Investment Risk. The fund may invest a portion of its assets directly in equity and fixed income securities, as well as other mutual funds or ETFs, to maintain its asset allocations. The fund’s direct investment in these securities is subject to the same or similar risks as an underlying fund’s investment in the same security.

Please refer to the fund’s prospectus for a more complete description of the principal risks of investing in the fund.

17

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions:

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles Schwab Corporation, serves as the fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement (“Advisory Agreement”) between CSIM and the trust.

The Board has adopted a Shareholder Servicing Plan (the “Plan”) on behalf of the fund. The Plan enables the fund to bear expenses relating to the provision by service providers, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, “Schwab”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the fund. The fund is not subject to any fee under the Plan.

CSIM and its affiliates have agreed with the fund to limit (“expense limitation”) the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses of the fund to 0.00%, for so long as CSIM serves as the investment adviser to the fund, which may only be amended or terminated with the approval of the Board.

The agreement to limit the fund’s total expenses charged is limited to the fund’s direct operating expenses and, therefore, does not apply to underlying fund fees and expenses, which are indirect expenses incurred by a fund through its investments in the underlying funds.

The fund may engage in direct transactions with certain other Schwab Funds 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/or officers. For the period ended April 30, 2013, the fund had no direct security transactions with other Schwab Funds.

The fund may engage in certain transactions involving related parties. Pursuant to an exemptive order issued by the SEC, the fund may invest in other related funds. As of April 30, 2013, the percentages of shares of other related funds owned by the Schwab Balanced Fund are:

Laudus Growth Investors U.S. Large Cap Growth Fund	1.3%
Schwab Core Equity Fund	2.5%
Laudus Small-Cap MarketMasters Fund	8.3%
Schwab Intermediate-Term Bond Fund	4.6%
Schwab Total Bond Market Fund	3.8%

Below is a summary of the fund’s transactions with its affiliated underlying funds during the period ended April 30, 2013.

	Balance							Balance				Realized			Distributions
	of Shares							of Shares		Market		Gains (Losses)			Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12			11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13			to 04/30/13
Laudus Growth Investors U.S. Large Cap Growth Fund		1,303,273		312,646		(160,605	)		1,455,314		$22,848,432		($54,080	)		$342,522
Schwab Core Equity Fund		2,160,527		463,913		(158,460	)		2,465,980		52,180,129		(47,611	)		348,002
Laudus Small-Cap MarketMasters Fund, Select Shares		866,818		172,848		(101,583	)		938,083		14,258,859		(14,134	)		—
Schwab Intermediate-Term Bond Fund		1,370,897		478,731		(132,530	)		1,717,098		17,874,991		(14,578	)		386,104
Schwab Total Bond Market Fund		2,967,154		882,795		(275,975	)		3,573,974		34,667,543		(10,831	)		361,006
Total											$141,829,954		($141,234	)		$1,437,634

* Distributions received include distributions from net investment income and capital gains, if any, from the underlying funds.

Pursuant to an exemptive order issued by the SEC, the fund may enter into interfund borrowing and lending transactions with other Schwab Funds. All loans are for temporary or emergency purposes only. The interest rate to be charged on a loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending facility is subject to the oversight and periodic review by the Board. The fund had no interfund borrowing or lending activity during the period.

18 

 Schwab Balanced Fund

Financial Notes, unaudited (continued)

5. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted in the fund’s Statement of Operations. For information regarding the trustees please refer to Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The fund has access to custodian overdraft facilities, a committed line of credit of $150 million with State Street, an uncommitted line of credit of $100 million with Bank of America, N.A. and an uncommitted line of credit of $50 million with Brown Brothers Harriman & Co. The fund pays interest on the amount it borrows at rates that are negotiated periodically. The fund also pays an annual fee to State Street for the committed line of credit.

There were no borrowings from the lines of credit by the fund during the period. However, the fund may have utilized its overdraft facility and incurred interest expense, which is disclosed in the Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2013, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

Purchases of Securities		Sales/Maturities of Securities
	$29,938,000		$10,930,000

8. Redemption Fee:

The fund charges a 2.00% redemption fee on shares sold or exchanged within 30 days of the original purchase date. Such amounts are netted against redemption proceeds in the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

Current Period		Prior Period
(11/1/12-4/30/13)		(11/1/11-10/31/12)
	$2,716		$141,969

9. Federal Income Taxes:

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of October 31, 2012, the fund had capital loss carryforwards $4,073,757 available to offset future net capital gains before October 31, 2017.

For the year ended October 31, 2012, the fund had capital losses utilized as follows:

Capital losses utilized $162,978

As of October 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the fund, and has determined that no provision for income tax is required in the fund’s financial statements. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended October 31, 2012, the fund did not incur any interest or penalties.

10. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

19

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Capital Trust, which includes the fund covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The Fund Complex includes 94 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the fund’s Statement of Additional Information, which is available free by calling 1-800-435-4000.

 Independent Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Mariann Byerwalter 1960 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman of JDN Corporate Advisory LLC (advisory services firm) (Oct. 2001 – present).	77	Director,WageWorks, Inc. (2010 – present) Director, Redwood Trust, Inc. (1998 – present) Director, PMI Group Inc. (2001 – 2009)
John F. Cogan 1947 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research; Professor of Public Policy, Stanford University (Sept. 2000 – present).	77	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
William A. Hasler 1941 Trustee (Trustee of Schwab Capital Trust since 2000.)	Dean Emeritus, Haas School of Business, University of California, Berkeley (July 1998 – present).	77	Director, TOUSA (1998 – present) Director, Globalstar, Inc. (2009 –��present) Director, Aviat Networks (2001 – present) Director, Mission West Properties (1998 – 2012) Director, Ditech Networks Corporation (1997 – 2012) Director, Genitope Corporation (2000 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	77	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Tercica Inc. (2004 – 2008)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – present); Senior Vice President and General Manager of Consumer Group, Intuit, Inc. (June 2007 – Dec. 2008); Senior Vice President and Chief Financial Officer, Intuit, Inc. (Sept. 2005 – Jan. 2008).	77	Director, KLA-Tencor Corporation (2008 – present) Director, BEA Systems, Inc. (2007 – 2008)
Gerald B. Smith 1950 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (1990 – present).	77	Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – present) Director, Oneok, Inc (2009 – present) Lead Independent Director, Board of Cooper Industries (2002 – 2012)

20 

 Independent Trustees (continued)

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (Jan. 2008- present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	77	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

 Interested Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served )	During the Past Five Years	the Trustee	Other Directorships
Charles R. Schwab2 1937 Chairman and Trustee (Chairman and Trustee of Schwab Capital Trust since 1993.)	Chairman and Director, The Charles Schwab Corporation, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc., Charles Schwab Bank, N. A.; Chairman and Chief Executive Officer, Schwab (SIS) Holdings Inc. I, Schwab International Holdings, Inc.; Chief Executive Officer, Schwab Holdings, Inc.; Through June 2007, Director, U.S. Trust Company, N. A., U.S. Trust Corporation, United States Trust Company of New York. Until October 2008, Chief Executive Officer, The Charles Schwab Corporation, Charles Schwab & Co., Inc.	77	None
Walter W. Bettinger II2 1960 Trustee (Trustee of Schwab Capital Trust since 2008.)	As of October 2008, President and Chief Executive Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. Since October 2008, Director, The Charles Schwab Corporation. Since May 2008, Director, Charles Schwab & Co., Inc. and Schwab Holdings, Inc. Since 2006, Director, Charles Schwab Bank. Until October 2008, President and Chief Operating Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. From 2004 through 2007, Executive Vice President and President, Schwab Investor Services. From 2004 through 2005, Executive Vice President and Chief Operating Officer, Individual Investor Enterprise, and from 2002 through 2004, Executive Vice President, Corporate Services.	94	None

 Officers of the Trust

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
Marie Chandoha 1961 President and Chief Executive Officer (Officer of Schwab Capital Trust since 2010.)	Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President and Chief Executive Officer (Dec. 2010 – present) and Chief Investment Officer (Dec. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 2007 – August 2010).

21

 Officers of the Trust (continued)

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
George Pereira 1964 Treasurer and Principal Financial Officer (Officer of Schwab Capital Trust since 2004.)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab Asset Management (Ireland) Limited (April 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 2011 – present); Senior Managing Director, Global Head of Active Fixed-Income Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head of Market-Based Strategies, State Street Research (August 2003 – Jan. 2005).
David Lekich 1964 Secretary and Chief Legal Officer (Officer of Schwab Capital Trust since 2011.)	Senior Vice President (Sept. 2011 – present), Vice President (March 2004 – Sept. 2011), Charles Schwab & Co., Inc.; Senior Vice President and Chief Counsel (Sept. 2011 – present), Vice President (Jan. 2011 – Sept. 2011), Charles Schwab Investment Management, Inc.; Secretary (April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President (Officer of Schwab Capital Trust since 2005.)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant Secretary, Schwab ETFs (Oct. 2009 – present).

1	Trustees remain in office until they resign, retire or are removed by shareholder vote. The Schwab Funds® retirement policy requires that independent trustees elected after January 1, 2000 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the Schwab Funds retirement policy also requires any independent trustee of the Schwab Funds who also serves as an independent trustee of the Laudus Funds to retire from the Boards of the Schwab Funds upon their required retirement date from either the Boards of Trustees of the Schwab Funds or the Laudus Funds, whichever comes first.
2	Mr. Schwab and Mr. Bettinger are Interested Trustees because they are employees of Schwab. In addition to their employment with Schwab, Messrs. Schwab and Bettinger also own stock of The Charles Schwab Corporation, the parent company of Schwab and the investment adviser.
3	The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

22 

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.

Barclays U.S. Aggregate Bond Index A broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-back securities (agency fixed-rate and hybrid ARM passthroughs), asset-backed securities, and commercial mortgage-backed securities.

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.”

An individual bond is subject to the credit risk of the issuer. Changes in interest rates can affect a bond’s market value prior to call or maturity. There is no guarantee that a bond’s yield to call or maturity will provide a positive return over the rate of inflation.

bond fund A bond fund is subject to the same credit, interest rate, and inflation risks as bonds. In addition, a bond fund incurs ongoing fees and expenses. A bond fund’s net asset value will fluctuate with the price of the underlying bonds and the portfolio turnover activity; return of principal is not guaranteed.

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.

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.

MSCI EAFE Index A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada.

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.

Russell 2000 Index An index that measures the performance of the small-cap segment of the U.S. equity universe.

S&P 500 Index A market capitalization index that is designed to measure the performance of 500 leading publicly held companies in leading industries of the U.S. economy.

stock A share of ownership, or equity, in the issuing company.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

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.

23

Notes

Schwab Funds^® offers you an extensive family of mutual funds, each one based on a clearly defined investment approach and using disciplined management strategies. The list at right shows all currently available Schwab Funds.

Whether you are an experienced investor or just starting out, Schwab Funds can help you achieve your financial goals. An investor should consider a fund’s investment objectives, risks, charges and expenses carefully before investing or sending money. This and other important information can be found in the fund’s prospectus. Please call 1-800-435-4000 for a prospectus and brochure for any Schwab Fund. Please read the prospectus carefully before you invest. This report must be preceded or accompanied by a current prospectus.

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting Schwab’s website at www.schwabfunds.com/prospectus, the SEC’s website at http://www.sec.gov, or by contacting Schwab Funds at 1-800-435-4000.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.schwabfunds.com/prospectus or the SEC’s website at http://www.sec.gov.

The Schwab Funds Family^®

Stock Funds

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core Equity Fund

Schwab Fundamental US Large Company Index Fund

Schwab Fundamental US Small Company Index Fund

Schwab Fundamental International Large Company Index Fund

Schwab Fundamental International Small Company Index Fund

Schwab Fundamental Emerging Markets Large Company Index Fund

Schwab Global Real Estate Fund^tm

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market Index Fund^®

Schwab International Index Fund^®

Asset Allocation Funds

Schwab Balanced Fund^tm

Schwab MarketTrack All Equity Portfolio^tm

Schwab MarketTrack Growth Portfolio^tm

Schwab MarketTrack Balanced Portfolio^tm

Schwab MarketTrack Conservative Portfolio^tm

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

Schwab^® Monthly Income Fund – Moderate Payout

Schwab^® Monthly Income Fund – Enhanced Payout

Schwab^® Monthly Income Fund – Maximum Payout

Bond Funds

Schwab Short-Term Bond Market Fund^tm

Schwab Intermediate-Term Bond Fund^tm

Schwab Total Bond Market Fund^tm

Schwab GNMA Fund^tm

Schwab^® Treasury Inflation Protected Securities Index Fund

Schwab Tax-Free Bond Fund^tm

Schwab California Tax-Free Bond Fund^tm

Schwab Money Funds

Schwab offers an array of money market funds¹. Choose from taxable or tax-advantaged alternatives. Many can be linked to your eligible Schwab account to “sweep” cash balances automatically, subject to availability, when you’re between investments. Or, for your larger cash reserves, choose one of our Value Advantage Investments^®.

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.

Investment Adviser

Charles Schwab Investment Management, Inc.

211 Main Street, San Francisco, CA 94105

Funds

Schwab Funds^®

P.O. Box 3812, Englewood, CO 80155–3812

This report is not authorized for distribution to prospective investors

unless preceded or accompanied by a current prospectus.

^© 2013 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR34721-07

00098636

Semiannual report dated April 30, 2013, enclosed.

Schwab MarketTrack Portfolios ^®

Schwab MarketTrack

All Equity Portfolio^tm

Schwab MarketTrack

Growth Portfolio^tm

Schwab MarketTrack

Balanced Portfolio^tm

Schwab MarketTrack

Conservative Portfolio^tm

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Schwab MarketTrack Portfolios ^®

Semiannual Report

April 30, 2013

Schwab MarketTrack

All Equity Portfolio^tm

Schwab MarketTrack

Growth Portfolio^tm

Schwab MarketTrack

Balanced Portfolio^tm

Schwab MarketTrack

Conservative Portfolio^tm

This page is intentionally left blank.

Schwab MarketTrack Portfolios^®

In This Report

Performance at a Glance	2
From the President	3
Portfolio Management	5
Performance and Fund Facts
Schwab MarketTrack All Equity Portfolio™	6
Schwab MarketTrack Growth Portfolio™	7
Schwab MarketTrack Balanced Portfolio™	8
Schwab MarketTrack Conservative Portfolio™	9
Fund Expenses	10
Financial Statements and Portfolio Holdings
Schwab MarketTrack All Equity Portfolio™	11
Schwab MarketTrack Growth Portfolio™	16
Schwab MarketTrack Balanced Portfolio™	21
Schwab MarketTrack Conservative Portfolio™	26
Financial Notes	31
Trustees and Officers	40
Glossary	43

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM).
Distributor: Charles Schwab & Co., Inc. (Schwab).

Performance at a Glance

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

Total Return for the Six Months Ended April 30, 2013
Schwab MarketTrack All Equity Portfoliotm(Ticker Symbol: SWEGX)	15.29%
All Equity Composite Index	15.72%
Fund Category: Morningstar Large-Cap Blend	14.54%
Performance Details	page 6
Schwab MarketTrack Growth Portfoliotm(Ticker Symbol: SWHGX)	12.22%
Growth Composite Index	12.52%
Fund Category: Morningstar Aggressive Allocation	11.35%
Performance Details	page 7
Schwab MarketTrack Balanced Portfoliotm(Ticker Symbol: SWBGX)	9.20%
Balanced Composite Index	9.52%
Fund Category: Morningstar Moderate Allocation	9.17%
Performance Details	page 8
Schwab MarketTrack Conservative Portfoliotm(Ticker Symbol: SWCGX)	6.31%
Conservative Composite Index	6.58%
Fund Category: Morningstar Conservative Allocation	5.88%
Performance Details	page 9

Minimum Initial Investment¹ $ 100

All figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio expenses may have been partially absorbed by CSIM and its affiliates. Without these reductions, a portfolio’s total return would have been lower. Performance does not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or on the redemption of portfolio shares.

Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.

The components that make up each of the following composite indices may vary over time.

The All Equity Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 70% Dow Jones U.S. Total Stock Market Index and 30% MSCI EAFE Index (Net). The index is maintained by CSIM.

The Growth Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 60% Dow Jones U.S. Total Stock Market Index, 20% MSCI EAFE Index (Net), 15% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1-3 Months Index. The index is maintained by CSIM.

The Balanced Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 45% Dow Jones U.S. Total Stock Market Index, 15% MSCI EAFE Index (Net), 35% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1-3 Months Index. The index is maintained by CSIM.

The Conservative Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 30% Dow Jones U.S. Total Stock Market Index, 10% MSCI EAFE Index (Net), 55% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1-3 Months Index. The index is maintained by CSIM.

¹ Please see the funds’ prospectus for further detail and eligibility requirements.

2 Schwab MarketTrack Portfolios

From the President

Marie Chandoha is President and CEO of Charles Schwab Investment Management, Inc. and the funds covered in this report.

Dear Shareholder,

As President and CEO of Charles Schwab Investment Management, Inc., I’d like to thank you for trusting us to help you meet your investment goals, and for reading this important report concerning the Schwab MarketTrack Portfolios. Each of the four portfolios combines a variety of passive strategies in U.S. and international markets, seeking to provide diversification, while targeting varying degrees of risk.

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets, combined with mixed returns for bonds. The backdrop for these performances included efforts undertaken by the Federal Reserve and many central banks around the world to stimulate faster economic growth by keeping interest rates low. This was particularly the case in Japan, where aggressive central bank policies helped fuel a rally by equities, while the yen depreciated sharply versus the U.S. dollar.

Reduced concerns about the euro zone’s sovereign debt crisis and U.S. fiscal cliff also generally helped stocks, as did signs of improvement in the U.S. housing market. Returns for bonds reflected these developments and the low level of interest rates. Many major U.S. stock market indices finished at or near record highs, while the MSCI EAFE Index (net) returned 16.9% compared with the 15.2% return of the Dow Jones U.S. Total Stock Market Index. Among fixed income securities, the Barclays U.S. Aggregate Bond Index—broadly reflecting the U.S. bond market—returned 0.9%.

 Asset Class Performance Comparison % returns during the report period

This graph compares the performance of various asset classes during the report period. Final performance figures for the period are in the key below.

	14.42%	S&P 500® Index: measures U.S. large-cap stocks
	16.58%	Russell 2000® Index: measures U.S. small-cap stocks
	17.18%	MSCI EAFE® Index (Gross): measures (in U.S. dollars) large-cap stocks in Europe, Australasia and the Far East
	0.90%	Barclays U.S. Aggregate Bond Index: measures the U.S. bond market
	0.04%	Three-Month U.S. Treasury Bills (T-bills): measures short-term U.S. Treasury obligations

Index figures assume dividends and distributions were reinvested, and do not include trading and management costs, which would lower performance. Indices are unmanaged, do not incur management fees, costs and expenses, and you cannot invest in them directly. Remember that past performance is not an indication of future results.

Data source: Index provider websites and CSIM.

Nothing in this report represents a recommendation of a security by the investment adviser.

Management views and portfolio holdings may have changed since the report date.

Schwab MarketTrack Portfolios 3

From the President continued

For the six months ended April 30, 2013, the returns of the funds reflected a strong rally by stocks in U.S. and developed international markets, combined with mixed returns for bonds.

For more information about the Schwab MarketTrack Portfolios, please continue reading this report. In addition, you can find answers to frequently asked questions and more details about the funds by visiting www.schwabfunds.com. We are also happy to hear from you at 1-800-435-4000.

Sincerely,

4 Schwab MarketTrack Portfolios

Portfolio Management

Zifan Tang, CFA, Managing Director and Head of Asset Allocation Strategies, leads the portfolio management team and has overall responsibility for all aspects of the management of the funds. She was appointed portfolio manager of the funds in February 2012. Prior to joining CSIM in 2012, Ms. Tang was a product manager at Thomson Reuters and, from 1997 to 2009, worked as a portfolio manager at Barclays Global Investors, which was subsequently acquired by BlackRock.

Schwab MarketTrack Portfolios 5

Schwab MarketTrack All Equity Portfolio™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Portfolio and Inception Date	6 Months			1 Year			5 Years			10 Years
Portfolio: Schwab MarketTrack All Equity Porfoliotm (5/19/98)		15.29	%		17.31	%		3.69	%		8.60	%
All Equity Composite Index3		15.72	%		17.91	%		3.84	%		8.97	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Large-Cap Blend		14.54	%		15.95	%		4.18	%		7.49	%

Fund Expense Ratios⁴: Net 0.64%; Gross 0.67%

 Statistics

Number of Holdings	4
Portfolio Turnover Rate5	4%

 Asset Class Weightings % of Investments

Equity Funds – Large-Cap	45.1%
Equity Funds – International	30.1%
Equity Funds – Small-Cap	24.4%
Short-Term Investments	0.4%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab S&P 500 Index Fund	45.1%
Schwab International Index Fund	30.1%
Schwab Small-Cap Index Fund	24.4%
Total	99.6%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Small-company stocks are subject to greater volatility than other asset classes.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Portfolio expenses have been partially absorbed by CSIM and its affiliates. Without these reductions, the portfolio’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or the redemption of portfolio shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The All Equity Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 70% Dow Jones U.S. Total Stock Market Index and 30% MSCI EAFE Index (Net). The index is maintained by CSIM. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the portfolio invests. The annualized weighted average expense ratio of the underlying funds was 0.14%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

6 Schwab MarketTrack Portfolios

Schwab MarketTrack Growth Portfolio™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Portfolio and Inception Date	6 Months			1 Year			5 Years			10 Years
Portfolio: Schwab MarketTrack Growth Porfoliotm (11/20/95)		12.22	%		14.24	%		4.28	%		7.69	%
Growth Composite Index3		12.52	%		14.77	%		4.55	%		8.19	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Fund Category: Morningstar Aggressive Allocation		11.35	%		12.74	%		3.47	%		7.22	%

Fund Expense Ratios⁴: Net 0.65%; Gross 0.68%

 Statistics

Number of Holdings	7
Portfolio Turnover Rate5	5%

 Asset Class Weightings % of Investments

Equity Funds – Large-Cap	40.5%
Equity Funds – International	20.2%
Equity Funds – Small-Cap	19.9%
Fixed-Income Funds – Intermediate-Term Bond	14.5%
Short-Term Investments	3.1%
Money Market Funds	1.8%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab S&P 500 Index Fund	40.4%
Schwab International Index Fund	20.2%
Schwab Small-Cap Index Fund	19.9%
Schwab Total Bond Market Fund	14.5%
Schwab Value Advantage Money Fund, Institutional Prime Shares	1.8%
Total	96.8%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Small-company stocks are subject to greater volatility than other asset classes.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Portfolio expenses have been partially absorbed by CSIM and its affiliates. Without these reductions, the portfolio’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or the redemption of portfolio shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Growth Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 60% Dow Jones U.S. Total Stock Market Index, 20% MSCI EAFE Index (Net), 15% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1-3 Months Index. The index is maintained by CSIM. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the portfolio invests. The annualized weighted average expense ratio of the underlying funds was 0.15%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

Schwab MarketTrack Portfolios 7

Schwab MarketTrack Balanced Portfolio™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Portfolio and Inception Date	6 Months			1 Year			5 Years			10 Years
Portfolio: Schwab MarketTrack Balanced Portfoliotm (11/20/95)		9.20	%		11.24	%		4.36	%		6.70	%
Balanced Composite Index3		9.52	%		11.95	%		5.03	%		7.52	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.04	%
Fund Category: Morningstar Moderate Allocation		9.17	%		11.16	%		4.43	%		6.79	%

Fund Expense Ratios⁴: Net 0.69%; Gross 0.72%

 Statistics

Number of Holdings	7
Portfolio Turnover Rate5	6%

 Asset Class Weightings % of Investments

Fixed-Income Funds – Intermediate-Term Bond	34.5%
Equity Funds – Large-Cap	30.5%
Equity Funds – International	15.2%
Equity Funds – Small-Cap	15.0%
Short-Term Investments	3.1%
Money Market Funds	1.7%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Total Bond Market Fund	34.5%
Schwab S&P 500 Index Fund	30.5%
Schwab International Index Fund	15.2%
Schwab Small-Cap Index Fund	14.9%
Schwab Value Advantage Money Fund, Institutional Prime Shares	1.7%
Total	96.8%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Small-company stocks are subject to greater volatility than other asset classes.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Portfolio expenses have been partially absorbed by CSIM and its affiliates. Without these reductions, the portfolio’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or the redemption of portfolio shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Balanced Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 45% Dow Jones U.S. Total Stock Market Index, 15% MSCI EAFE Index (Net), 35% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1-3 Months Index. The index is maintained by CSIM. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the portfolio invests. The annualized weighted average expense ratio of the underlying funds was 0.19%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

8 Schwab MarketTrack Portfolios

Schwab MarketTrack Conservative Portfolio™

Performance and Fund Facts as of 04/30/13

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment returns and principal value will fluctuate so that an investor’s shares may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted. To obtain performance information current to the most recent month end, please visit www.schwabfunds.com/prospectus.

 Average Annual Total Returns^1,2

Portfolio and Inception Date	6 Months			1 Year			5 Years			10 Years
Portfolio: Schwab MarketTrack Conservative Portfoliotm (11/20/95)		6.31	%		8.40	%		4.27	%		5.62	%
Conservative Composite Index3		6.58	%		9.13	%		5.33	%		6.74	%
S&P 500® Index		14.42	%		16.89	%		5.21	%		7.88	%
Barclays U.S. Aggregate Bond Index		0.90	%		3.68	%		5.72	%		5.04	%
Fund Category: Morningstar Conservative Allocation		5.88	%		8.57	%		4.88	%		5.90	%

Fund Expense Ratios⁴: Net 0.72%; Gross 0.77%

 Statistics

Number of Holdings	7
Portfolio Turnover Rate5	7%

 Asset Class Weightings % of Investments

Fixed-Income Funds – Intermediate-Term Bond	54.5%
Equity Funds – Large-Cap	20.6%
Equity Funds – International	10.2%
Equity Funds – Small-Cap	9.9%
Short-Term Investments	3.1%
Money Market Funds	1.7%
Total	100.0%

 Top Holdings % of Net Assets^6,7

Schwab Total Bond Market Fund	54.5%
Schwab S&P 500 Index Fund	20.5%
Schwab International Index Fund	10.2%
Schwab Small-Cap Index Fund	9.9%
Schwab Value Advantage Money Fund, Institutional Prime Shares	1.7%
Total	96.8%

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not annualized.

Portfolio holdings may have changed since the report date.

Small-company stocks are subject to greater volatility than other asset classes.

Foreign securities can involve risks such as political and economic instability and currency risk.

1	Portfolio expenses have been partially absorbed by CSIM and its affiliates. Without these reductions, the portfolio’s returns would have been lower. These returns do not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or the redemption of portfolio shares.
2	Source for category information: Morningstar, Inc. The Morningstar Category return represents all active and index mutual funds within the category as of the report date.
3	The Conservative Composite Index is a custom blended index developed by CSIM based on a comparable portfolio asset allocation and calculated using the following portion allocations: 30% Dow Jones U.S. Total Stock Market Index, 10% MSCI EAFE Index (Net), 55% Barclays U.S. Aggregate Bond Index, and 5% Barclays U.S. Treasury Bills: 1-3 Months Index. The index is maintained by CSIM. The components that make up the composite index may vary over time.
4	As stated in the prospectus. Includes expenses of the underlying funds in which the portfolio invests. The annualized weighted average expense ratio of the underlying funds was 0.22%. Net Expense: Expenses reduced by a contractual fee waiver in effect for so long as CSIM serves as adviser to the fund. Gross Expense: Does not reflect the effect of contractual fee waivers. For actual ratios during the period, refer to the financial highlights section of the financial statements.
5	Not annualized.
6	This list is not a recommendation of any security by the investment adviser.
7	The holdings listed exclude any temporary liquidity investments.

Schwab MarketTrack Portfolios 9

Fund Expenses (Unaudited)

 Examples for a $1,000 Investment

As a fund shareholder, you incur two types of costs: transaction costs, such as redemption fees, and ongoing costs, such as management fees, transfer agent and shareholder services fees, and other fund expenses.

The expense examples below are intended to help you understand your ongoing cost (in dollars) of investing in a fund and to compare this cost with the ongoing cost of investing in other mutual funds. These examples are based on an investment of $1,000 invested for six months beginning November 1, 2012 and held through April 30, 2013.

Actual Return lines in the table below provide information about actual account values and actual expenses. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value ¸ $1,000 = 8.6), then multiply the result by the number given for your fund or share class under the heading entitled “Expenses Paid During Period.”

Hypothetical Return lines in the table below provide information about hypothetical account values and hypothetical expenses based on a fund’s or share class’ actual expense ratio and an assumed return of 5% per year before expenses. Because the return used is not an actual return, it may not be used to estimate the actual ending account value or expenses you paid for the period.

You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as redemption fees. If these transactional costs were included, your costs would have been higher.

					Ending
			Beginning		Account Value		Expenses Paid
	Expense Ratio1		Account Value		(Net of Expenses)		During Period2
	(Annualized)		at 11/1/12		at 4/30/13		11/1/12–4/30/13
Schwab MarketTrack All Equity Portfoliotm
Actual Return		0.50%	$	1,000	$	1,152.90	$	2.67
Hypothetical 5% Return		0.50%	$	1,000	$	1,022.32	$	2.51
Schwab MarketTrack Growth Portfoliotm
Actual Return		0.50%	$	1,000	$	1,122.20	$	2.63
Hypothetical 5% Return		0.50%	$	1,000	$	1,022.32	$	2.51
Schwab MarketTrack Balanced Portfoliotm
Actual Return		0.50%	$	1,000	$	1,092.00	$	2.59
Hypothetical 5% Return		0.50%	$	1,000	$	1,022.32	$	2.51
Schwab MarketTrack Conservative Portfoliotm
Actual Return		0.50%	$	1,000	$	1,063.10	$	2.56
Hypothetical 5% Return		0.50%	$	1,000	$	1,022.32	$	2.51

1	Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights. The expenses incurred by the underlying funds in which the portfolios invest are not included in this ratio.
2	Expenses for each portfolio are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by the 181 days of the period, and divided by the 365 days of the fiscal year.

10 Schwab MarketTrack Portfolios

Schwab MarketTrack All Equity Portfolio™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–		11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12		10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		12.79			11.52		11.30			9.82			9.44			15.58
Income (loss) from investment operations:
Net investment income (loss)		0.30			0.25		0.16			0.12			0.30			0.20
Net realized and unrealized gains (losses)		1.61			1.02		0.27			1.50			0.83			(6.11	)
Total from investment operations		1.91			1.27		0.43			1.62			1.13			(5.91	)
Less distributions:
Distributions from net investment income		(0.34	)		—		(0.21	)		(0.14	)		(0.23	)		(0.22	)
Distributions from net realized gains		—			—		—			—			(0.52	)		(0.01	)
Total distributions		(0.34	)		—		(0.21	)		(0.14	)		(0.75	)		(0.23	)
Net asset value at end of period		14.36			12.79		11.52			11.30			9.82			9.44
Total return (%)		15.29	1		11.02		3.76			16.62			13.54			(38.46	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50		0.50			0.50			0.50			0.50
Gross operating expenses2		0.53	3		0.54		0.53			0.54			0.67			0.73
Net investment income (loss)		4.49	3		1.93		1.37			1.14			3.46			1.46
Portfolio turnover rate		4	1		6		12			8			10			10
Net assets, end of period ($ x 1,000,000)		535			475		476			489			461			429

* Unaudited.

¹ Not annualized.

² The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

³ Annualized.

See financial notes 11

 Schwab MarketTrack All Equity Portfolio

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	99	.6%	Other Investment Companies		387,896,905		532,825,281
	0	.4%	Short-Term Investment		2,215,827		2,215,827
	100	.0%	Total Investments		390,112,732		535,041,108
	0	.0%	Other Assets and Liabilities, Net				261,914
	100	.0%	Total Net Assets				535,303,022

	Number		Value
Security	of Shares		($)
Other Investment Companies 99.6% of net assets
Equity Funds 99.6%
International 30.1%
Schwab International Index Fund (a)		8,748,352		160,882,197
Large-Cap 45.1%
Schwab S&P 500 Index Fund (a)		9,650,540		241,360,017
Small-Cap 24.4%
Schwab Small-Cap Index Fund (a)		5,526,156		130,583,067
Total Other Investment Companies
(Cost $387,896,905)				532,825,281
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 0.4% of net assets
Time Deposit 0.4%
DNB
0.03%, 05/01/13		2,215,827		2,215,827
Total Short-Term Investment
(Cost $2,215,827)				2,215,827
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $404,839,763 and the unrealized appreciation and depreciation were $130,201,345 and ($0), respectively, with a net unrealized appreciation of $130,201,345.

(a) Issuer is affiliated with the fund’s adviser.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$532,825,281		$—		$—		$532,825,281
Short-Term Investment1		—		2,215,827		—		2,215,827
Total		$532,825,281		$2,215,827		$—		$535,041,108

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

12 See financial notes

 Schwab MarketTrack All Equity Portfolio

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $387,896,905)		$532,825,281
Investments in unaffiliated issuers, at value (cost $2,215,827)	+	2,215,827
Total investments, at value (cost $390,112,732)		535,041,108
Receivables:
Fund shares sold		571,226
Interest		2
Prepaid expenses	+	7,976
Total assets		535,620,312
Liabilities
Payables:
Investment adviser and administrator fees		10,003
Shareholder service fees		11,509
Fund shares redeemed		192,974
Accrued expenses	+	102,804
Total liabilities		317,290
Net Assets
Total assets		535,620,312
Total liabilities	−	317,290
Net assets		$535,303,022
Net Assets by Source
Capital received from investors		442,774,198
Net investment income not yet distributed		11,124,727
Net realized capital losses		(63,524,279	)
Net unrealized capital gains		144,928,376
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$535,303,022		37,274,048			$14.36

See financial notes 13

 Schwab MarketTrack All Equity Portfolio

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$12,365,374
Interest	+	343
Total investment income		12,365,717
Expenses
Investment adviser and administrator fees		570,269
Shareholder service fees		606,459
Shareholder reports		30,807
Transfer agent fees		19,884
Professional fees		19,813
Index fee		15,197
Portfolio accounting fees		12,315
Registration fees		11,745
Custodian fees		5,762
Trustees’ fees		4,349
Other expenses	+	5,333
Total expenses		1,301,933
Expense reduction by CSIM and its affiliates	−	62,217
Net expenses	−	1,239,716
Net investment income		11,126,001
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		2,765,058
Net realized gains on sales of affiliated underlying funds		1,003,737
Net realized gains		3,768,795
Net unrealized gains on affiliated underlying funds	+	56,528,853
Net realized and unrealized gains		60,297,648
Increase in net assets resulting from operations		$71,423,649

14 See financial notes

 Schwab MarketTrack All Equity Portfolio

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$11,126,001			$9,163,297
Net realized gains		3,768,795			10,527,329
Net unrealized gains	+	56,528,853			30,350,130
Increase in net assets from operations		71,423,649			50,040,756
Distributions to Shareholders
Distributions from net investment income		($12,561,634	)		$—

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			2,360,518		$31,854,338			3,182,278		$38,781,401
Shares reinvested			918,465		11,765,529			—		—
Shares redeemed	+		(3,124,266	)	(41,948,740	)		(7,420,620	)	(90,468,387	)
Net transactions in fund shares			154,717		$1,671,127			(4,238,342	)	($51,686,986	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			37,119,331		$474,769,880			41,357,673		$476,416,110
Total increase or decrease	+		154,717		60,533,142			(4,238,342	)	(1,646,230	)
End of period			37,274,048		$535,303,022			37,119,331		$474,769,880
Net investment income not yet distributed					$11,124,727					$12,560,360

See financial notes 15

Schwab MarketTrack Growth Portfolio™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		18.08			16.85			16.35			14.51			13.71			21.09
Income (loss) from investment operations:
Net investment income (loss)		0.36			0.30			0.24			0.19			0.39			0.37
Net realized and unrealized gains (losses)		1.82			1.35			0.51			1.95			1.25			(6.94	)
Total from investment operations		2.18			1.65			0.75			2.14			1.64			(6.57	)
Less distributions:
Distributions from net investment income		(0.35	)		(0.42	)		(0.25	)		(0.30	)		(0.40	)		(0.41	)
Distributions from net realized gains		—			—			—			—			(0.44	)		(0.40	)
Total distributions		(0.35	)		(0.42	)		(0.25	)		(0.30	)		(0.84	)		(0.81	)
Net asset value at end of period		19.91			18.08			16.85			16.35			14.51			13.71
Total return (%)		12.22	1		10.03			4.55			14.86			12.95			(32.27	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50			0.50			0.50			0.50			0.50
Gross operating expenses2		0.52	3		0.53			0.52			0.52			0.66			0.71
Net investment income (loss)		3.81	3		1.78			1.39			1.25			3.03			1.99
Portfolio turnover rate		5	1		9			17			14			23			10
Net assets, end of period ($ x 1,000,000)		626			566			562			549			507			454

* Unaudited.

¹ Not annualized.

² The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

³ Annualized.

16 See financial notes

 Schwab MarketTrack Growth Portfolio

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.8%	Other Investment Companies		391,487,682		605,402,842
	3	.0%	Short-Term Investments		19,112,194		19,112,194
	99	.8%	Total Investments		410,599,876		624,515,036
	0	.2%	Other Assets and Liabilities, Net				1,091,118
	100	.0%	Total Net Assets				625,606,154

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.8% of net assets
Equity Funds 80.5%
International 20.2%
Schwab International Index Fund (a)		6,858,415		126,126,247
Large-Cap 40.4%
Schwab S&P 500 Index Fund (a)		10,119,037		253,077,116
Small-Cap 19.9%
Schwab Small-Cap Index Fund (a)		5,271,959		124,576,401
				503,779,764
Fixed-Income Fund 14.5%
Intermediate-Term Bond 14.5%
Schwab Total Bond Market Fund (a)		9,337,631		90,575,017
Money Market Fund 1.8%
Schwab Value Advantage Money Fund, Institutional Prime Shares (a)		11,048,061		11,048,061
Total Other Investment Companies
(Cost $391,487,682)				605,402,842
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.0% of net assets
Time Deposits 3.0%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		18,714,322		18,714,322
DNB
0.03%, 05/01/13		397,872		397,872
Total Short-Term Investments
(Cost $19,112,194)				19,112,194
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $415,567,367 and the unrealized appreciation and depreciation were $208,947,669 and ($0), respectively, with a net unrealized appreciation of $208,947,669.

(a) Issuer is affiliated with the fund’s adviser.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$605,402,842		$—		$—		$605,402,842
Short-Term Investments1		—		19,112,194		—		19,112,194
Total		$605,402,842		$19,112,194		$—		$624,515,036

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 17

 Schwab MarketTrack Growth Portfolio

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $391,487,682)		$605,402,842
Investments in unaffiliated issuers, at value (cost $19,112,194)	+	19,112,194
Total investments, at value (cost $410,599,876)		624,515,036
Receivables:
Investments sold		1,600,000
Fund shares sold		624,212
Dividends		164,143
Interest		16
Prepaid expenses	+	10,877
Total assets		626,914,284
Liabilities
Payables:
Investments bought		963,474
Investment adviser and administrator fees		11,526
Shareholder service fees		13,090
Fund shares redeemed		222,941
Accrued expenses	+	97,099
Total liabilities		1,308,130
Net Assets
Total assets		626,914,284
Total liabilities	−	1,308,130
Net assets		$625,606,154
Net Assets by Source
Capital received from investors		424,439,204
Distributions in excess of net investment income		(63,843	)
Net realized capital losses		(12,684,367	)
Net unrealized capital gains		213,915,160
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$625,606,154		31,419,686			$19.91

18 See financial notes

 Schwab MarketTrack Growth Portfolio

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$12,560,047
Interest	+	2,801
Total investment income		12,562,848
Expenses
Investment adviser and administrator fees		670,901
Shareholder service fees		716,545
Shareholder reports		28,188
Transfer agent fees		24,728
Professional fees		20,845
Index fee		20,525
Registration fees		15,325
Portfolio accounting fees		13,322
Custodian fees		6,651
Trustees’ fees		4,610
Other expenses	+	7,786
Total expenses		1,529,426
Expense reduction by CSIM and its affiliates	−	70,946
Net expenses	−	1,458,480
Net investment income		11,104,368
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		2,630,959
Net realized gains on sales of affiliated underlying funds		2,486,440
Net realized gains on unaffiliated investments	+	714
Net realized gains		5,118,113
Net unrealized gains on affiliated underlying funds	+	51,819,310
Net realized and unrealized gains		56,937,423
Increase in net assets resulting from operations		$68,041,791

See financial notes 19

 Schwab MarketTrack Growth Portfolio

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$11,104,368			$12,009,728
Net realized gains		5,118,113			23,457,290
Net unrealized gains	+	51,819,310			25,141,652
Increase in net assets from operations		68,041,791			60,608,670
Distributions to Shareholders1
Distributions from net investment income
Investor Shares		(10,641,577	)		(13,718,858	)
P Shares	+	—			(2,646,818	)
Total distributions from net investment income		($10,641,577	)		($16,365,676	)

Transactions in Fund Shares¹

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares Sold
Investor Shares			2,070,435		$39,200,991			3,069,722		$53,342,242
P Shares	+		—		—			1,037,994		17,419,210
Total shares sold			2,070,435		$39,200,991			4,107,716		$70,761,452
Shares Reinvested
Investor Shares			556,707		$10,081,957			797,108		$13,048,670
P Shares	+		—		—			161,786		2,646,818
Total shares reinvested			556,707		$10,081,957			958,894		$15,695,488
Shares Redeemed
Investor Shares			(2,537,934	)	($47,519,397	)		(5,854,994	)	($101,946,667	)
P Shares	+		—		—			(6,937,729	)	(120,546,911	)
Total shares redeemed			(2,537,934	)	($47,519,397	)		(12,792,723	)	($222,493,578	)
Net transactions in fund shares			89,208		$1,763,551			(7,726,113	)	($136,036,638	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			31,330,478		$566,442,389			39,056,591		$658,236,033
Total increase or decrease	+		89,208		59,163,765			(7,726,113	)	(91,793,644	)
End of period			31,419,686		$625,606,154			31,330,478		$566,442,389
Distributions in excess of net investment income					($63,843	)				($526,634	)

¹ Effective December 6, 2012, the P Share class was terminated.

20 See financial notes

Schwab MarketTrack Balanced Portfolio™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		16.33			15.41			14.96			13.54			12.74			18.13
Income (loss) from investment operations:
Net investment income (loss)		0.28			0.29			0.25			0.23			0.38			0.42
Net realized and unrealized gains (losses)		1.20			1.01			0.46			1.50			1.11			(5.06	)
Total from investment operations		1.48			1.30			0.71			1.73			1.49			(4.64	)
Less distributions:
Distributions from net investment income		(0.32	)		(0.38	)		(0.26	)		(0.31	)		(0.44	)		(0.48	)
Distributions from net realized gains		—			—			—			—			(0.25	)		(0.27	)
Total distributions		(0.32	)		(0.38	)		(0.26	)		(0.31	)		(0.69	)		(0.75	)
Net asset value at end of period		17.49			16.33			15.41			14.96			13.54			12.74
Total return (%)		9.20	1		8.61			4.80			12.92			12.41			(26.59	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50			0.50			0.50			0.50			0.50
Gross operating expenses2		0.52	3		0.53			0.52			0.52			0.66			0.72
Net investment income (loss)		3.33	3		1.86			1.64			1.59			3.09			2.57
Portfolio turnover rate		6	1		12			25			22			30			17
Net assets, end of period ($ x 1,000,000)		458			425			432			450			434			405

* Unaudited.

¹ Not annualized.

² The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

³ Annualized.

See financial notes 21

 Schwab MarketTrack Balanced Portfolio

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.8%	Other Investment Companies		306,848,954		443,909,156
	3	.2%	Short-Term Investments		14,362,281		14,362,281
	100	.0%	Total Investments		321,211,235		458,271,437
	0	.0%	Other Assets and Liabilities, Net				195,825
	100	.0%	Total Net Assets				458,467,262

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.8% of net assets
Equity Funds 60.6%
International 15.2%
Schwab International Index Fund (a)		3,780,856		69,529,942
Large-Cap 30.5%
Schwab S&P 500 Index Fund (a)		5,588,530		139,769,130
Small-Cap 14.9%
Schwab Small-Cap Index Fund (a)		2,901,808		68,569,724
				277,868,796
Fixed-Income Fund 34.5%
Intermediate-Term Bond 34.5%
Schwab Total Bond Market Fund (a)		16,289,558		158,008,711
Money Market Fund 1.7%
Schwab Value Advantage Money Fund, Institutional Prime Shares (a)		8,031,649		8,031,649
Total Other Investment Companies
(Cost $306,848,954)				443,909,156
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.2% of net assets
Time Deposits 3.2%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		11,913,115		11,913,115
Skandinaviska Enskilda Banken
0.03%, 05/01/13		2,449,166		2,449,166
Total Short-Term Investments
(Cost $14,362,281)				14,362,281
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $329,210,685 and the unrealized appreciation and depreciation were $129,060,752 and ($0), respectively, with a net unrealized appreciation of $129,060,752.

(a) Issuer is affiliated with the fund’s adviser.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$443,909,156		$—		$—		$443,909,156
Short-Term Investments1		—		14,362,281		—		14,362,281
Total		$443,909,156		$14,362,281		$—		$458,271,437

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

22 See financial notes

 Schwab MarketTrack Balanced Portfolio

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $306,848,954)		$443,909,156
Investments in unaffiliated issuers, at value (cost $14,362,281)	+	14,362,281
Total investments, at value (cost $321,211,235)		458,271,437
Receivables:
Investments sold		1,500,000
Fund shares sold		523,636
Dividends		286,194
Interest		12
Prepaid expenses	+	7,635
Total assets		460,588,914
Liabilities
Payables:
Investments bought		1,585,331
Investment adviser and administrator fees		8,436
Shareholder service fees		9,753
Fund shares redeemed		450,244
Accrued expenses	+	67,888
Total liabilities		2,121,652
Net Assets
Total assets		460,588,914
Total liabilities	−	2,121,652
Net assets		$458,467,262
Net Assets by Source
Capital received from investors		333,191,743
Net investment income not yet distributed		443,029
Net realized capital losses		(12,227,712	)
Net unrealized capital gains		137,060,202
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$458,467,262		26,207,013			$17.49

See financial notes 23

 Schwab MarketTrack Balanced Portfolio

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$8,265,976
Interest	+	2,095
Total investment income		8,268,071
Expenses
Investment adviser and administrator fees		496,741
Shareholder service fees		532,268
Professional fees		19,589
Shareholder reports		14,639
Transfer agent fees		13,250
Registration fees		12,342
Index fee		11,923
Portfolio accounting fees		11,838
Custodian fees		5,267
Trustees’ fees		4,187
Other expenses	+	4,817
Total expenses		1,126,861
Expense reduction by CSIM and its affiliates	−	46,990
Net expenses	−	1,079,871
Net investment income		7,188,200
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		1,475,871
Net realized gains on sales of affiliated underlying funds		2,769,663
Net realized gains on unaffiliated investments	+	443
Net realized gains		4,245,977
Net unrealized gains on affiliated underlying funds	+	27,024,804
Net realized and unrealized gains		31,270,781
Increase in net assets resulting from operations		$38,458,981

24 See financial notes

 Schwab MarketTrack Balanced Portfolio

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$7,188,200			$7,973,255
Net realized gains		4,245,977			9,088,999
Net unrealized gains	+	27,024,804			18,512,082
Increase in net assets from operations		38,458,981			35,574,336
Distributions to Shareholders
Distributions from net investment income		($8,153,239	)		($10,347,778	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,994,032		$33,628,874			3,144,255		$49,804,826
Shares reinvested			467,584		7,607,583			647,049		9,725,147
Shares redeemed	+		(2,279,920	)	(38,177,889	)		(5,822,667	)	(91,987,712	)
Net transactions in fund shares			181,696		$3,058,568			(2,031,363	)	($32,457,739	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			26,025,317		$425,102,952			28,056,680		$432,334,133
Total increase or decrease	+		181,696		33,364,310			(2,031,363	)	(7,231,181	)
End of period			26,207,013		$458,467,262			26,025,317		$425,102,952
Net investment income not yet distributed					$443,029					$1,408,068

See financial notes 25

Schwab MarketTrack Conservative Portfolio™

Financial Statements

Financial Highlights

	11/1/12–			11/1/11–			11/1/10–			11/1/09–			11/1/08–			11/1/07–
	4/30/13*			10/31/12			10/31/11			10/31/10			10/31/09			10/31/08
Per-Share Data ($)
Net asset value at beginning of period		14.23			13.59			13.22			12.15			11.34			14.90
Income (loss) from investment operations:
Net investment income (loss)		0.20			0.26			0.25			0.24			0.37			0.43
Net realized and unrealized gains (losses)		0.69			0.69			0.37			1.08			0.91			(3.40	)
Total from investment operations		0.89			0.95			0.62			1.32			1.28			(2.97	)
Less distributions:
Distributions from net investment income		(0.21	)		(0.31	)		(0.25	)		(0.25	)		(0.38	)		(0.46	)
Distributions from net realized gains		—			—			—			—			(0.09	)		(0.13	)
Total distributions		(0.21	)		(0.31	)		(0.25	)		(0.25	)		(0.47	)		(0.59	)
Net asset value at end of period		14.91			14.23			13.59			13.22			12.15			11.34
Total return (%)		6.31	1		7.07			4.72			10.98			11.72			(20.59	)
Ratios/Supplemental Data (%)
Ratios to average net assets:
Net operating expenses2		0.50	3		0.50			0.50			0.50			0.50			0.50
Gross operating expenses2		0.55	3		0.55			0.55			0.56			0.68			0.74
Net investment income (loss)		2.84	3		1.96			1.84			1.93			3.31			3.12
Portfolio turnover rate		7	1		19			30			25			25			16
Net assets, end of period ($ x 1,000,000)		202			189			198			194			181			182

* Unaudited.

¹ Not annualized.

² The expenses incurred by underlying funds in which the fund invests are not included in this ratio.

³ Annualized.

26 See financial notes

 Schwab MarketTrack Conservative Portfolio

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.8%	Other Investment Companies		149,687,309		195,599,623
	3	.1%	Short-Term Investments		6,327,344		6,327,344
	99	.9%	Total Investments		156,014,653		201,926,967
	0	.1%	Other Assets and Liabilities, Net				189,110
	100	.0%	Total Net Assets				202,116,077

	Number		Value
Security	of Shares		($)
Other Investment Companies 96.8% of net assets
Equity Funds 40.6%
International 10.2%
Schwab International Index Fund (a)		1,115,674		20,517,236
Large-Cap 20.5%
Schwab S&P 500 Index Fund (a)		1,660,657		41,533,039
Small-Cap 9.9%
Schwab Small-Cap Index Fund (a)		844,097		19,946,015
				81,996,290
Fixed-Income Fund 54.5%
Intermediate-Term Bond 54.5%
Schwab Total Bond Market Fund (a)		11,352,238		110,116,709
Money Market Fund 1.7%
Schwab Value Advantage Money Fund, Institutional Prime Shares (a)		3,486,624		3,486,624
Total Other Investment Companies
(Cost $149,687,309)				195,599,623
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.1% of net assets
Time Deposits 3.1%
Skandinaviska Enskilda Banken
0.03%, 05/01/13		6,056,646		6,056,646
Societe Generale
0.03%, 05/01/13		270,698		270,698
Total Short-Term Investments
(Cost $6,327,344)				6,327,344
End of Investments.

At 04/30/13, the tax basis cost of the fund’s investments was $163,851,405 and the unrealized appreciation and depreciation were $38,075,562 and ($0), respectively, with a net unrealized appreciation of $38,075,562.

(a) Issuer is affiliated with the fund’s adviser.

The following is a summary of the inputs used to value the fund’s investments as of April 30, 2013 (see financial note 2(a) for additional information):

	Quoted Prices in				Significant
	Active Markets for		Significant Other		Unobservable
	Identical Assets		Observable Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total2
Other Investment Companies1		$195,599,623		$—		$—		$195,599,623
Short-Term Investments1		—		6,327,344		—		6,327,344
Total		$195,599,623		$6,327,344		$—		$201,926,967

1	As categorized in Portfolio Holdings.
2	The fund had no Other Financial Instruments.

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were no transfers between Level 1, Level 2 and Level 3 for the period ended April 30, 2013.

See financial notes 27

 Schwab MarketTrack Conservative Portfolio

Statement of

Assets and Liabilities

As of April 30, 2013; unaudited

Assets
Investments in affiliated underlying funds, at value (cost $149,687,309)		$195,599,623
Investments in unaffiliated issuers, at value (cost $6,327,344)	+	6,327,344
Total investments, at value (cost $156,014,653)		201,926,967
Receivables:
Investments sold		630,000
Fund shares sold		280,777
Dividends		200,859
Interest		5
Prepaid expenses	+	3,253
Total assets		203,041,861
Liabilities
Payables:
Investments bought		780,311
Investment adviser and administrator fees		3,321
Shareholder service fees		4,032
Fund shares redeemed		96,334
Accrued expenses	+	41,786
Total liabilities		925,784
Net Assets
Total assets		203,041,861
Total liabilities	−	925,784
Net assets		$202,116,077
Net Assets by Source
Capital received from investors		170,711,102
Net investment income not yet distributed		99,881
Net realized capital losses		(14,607,220	)
Net unrealized capital gains		45,912,314
Net Asset Value (NAV)

		Shares
Net Assets	÷	Outstanding	=	NAV
$202,116,077		13,559,078			$14.91

28 See financial notes

 Schwab MarketTrack Conservative Portfolio

Statement of

Operations

For the period November 1, 2012 through April 30, 2013; unaudited

Investment Income
Dividends received from affiliated underlying funds		$3,230,276
Interest	+	961
Total investment income		3,231,237
Expenses
Investment adviser and administrator fees		222,784
Shareholder service fees		237,264
Professional fees		18,942
Registration fees		12,016
Transfer agent fees		9,919
Portfolio accounting fees		9,421
Shareholder reports		6,723
Index fee		4,904
Trustees’ fees		3,444
Custodian fees		2,955
Other expenses	+	2,348
Total expenses		530,720
Expense reduction by CSIM and its affiliates	−	46,407
Net expenses	−	484,313
Net investment income		2,746,924
Realized and Unrealized Gains (Losses)
Realized capital gain distributions received from affiliated underlying funds		444,177
Net realized gains on sales of affiliated underlying funds		1,121,773
Net realized gains on unaffiliated investments	+	68
Net realized gains		1,566,018
Net unrealized gains on affiliated underlying funds	+	7,601,566
Net realized and unrealized gains		9,167,584
Increase in net assets resulting from operations		$11,914,508

See financial notes 29

 Schwab MarketTrack Conservative Portfolio

Statement of

Changes in Net Assets

For the current and prior report periods
Figures for the current period are unaudited

Operations

11/1/12-4/30/13				11/1/11-10/31/12
Net investment income		$2,746,924			$3,852,050
Net realized gains		1,566,018			4,027,215
Net unrealized gains	+	7,601,566			6,051,777
Increase in net assets from operations		11,914,508			13,931,042
Distributions to Shareholders
Distributions from net investment income		($2,793,013	)		($4,482,834	)

Transactions in Fund Shares

		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		VALUE			SHARES		VALUE
Shares sold			1,505,056		$21,737,187			3,227,193		$44,181,272
Shares reinvested			180,982		2,582,977			308,192		4,188,027
Shares redeemed	+		(1,382,120	)	(20,007,115	)		(4,855,488	)	(67,192,496	)
Net transactions in fund shares			303,918		$4,313,049			(1,320,103	)	($18,823,197	)
Shares Outstanding and Net Assets
		11/1/12-4/30/13					11/1/11-10/31/12
			SHARES		NET ASSETS			SHARES		NET ASSETS
Beginning of period			13,255,160		$188,681,533			14,575,263		$198,056,522
Total increase or decrease	+		303,918		13,434,544			(1,320,103	)	(9,374,989	)
End of period			13,559,078		$202,116,077			13,255,160		$188,681,533
Net investment income not yet distributed					$99,881					$145,970

30 See financial notes

 Schwab MarketTrack Portfolios

Financial Notes, unaudited

1. Business Structure of the Funds:

Each of the funds discussed in this report is a series of Schwab Capital Trust (the “trust”), a no-load, open-end management investment company. The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trust as of the end of the period, including the funds discussed in this report, which are highlighted:

Schwab Capital Trust (organized May 7, 1993)	Schwab International Core Equity Fund
Schwab MarketTrack All Equity Portfolio	Schwab Target 2010 Fund
Schwab MarketTrack Growth Portfolio	Schwab Target 2015 Fund
Schwab MarketTrack Balanced Portfolio	Schwab Target 2020 Fund
Schwab MarketTrack Conservative Portfolio	Schwab Target 2025 Fund
Schwab S&P 500 Index Fund	Schwab Target 2030 Fund
Schwab Small-Cap Index Fund	Schwab Target 2035 Fund
Schwab Total Stock Market Index Fund	Schwab Target 2040 Fund
Schwab International Index Fund	Schwab Target 2045 Fund
Laudus Small-Cap MarketMasters Fund	Schwab Target 2050 Fund
Laudus International MarketMasters Fund	Schwab Target 2055 Fund
Schwab Balanced Fund	Schwab Fundamental US Large Company Index Fund
Schwab Core Equity Fund	Schwab Fundamental US Small Company Index Fund
Schwab Dividend Equity Fund	Schwab Fundamental International Large Company Index Fund
Schwab Large-Cap Growth Fund	Schwab Fundamental International Small Company Index Fund
Schwab Small-Cap Equity Fund	Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab Hedged Equity Fund	Schwab Monthly Income Fund - Moderate Payout
Schwab Financial Services Fund	Schwab Monthly Income Fund - Enhanced Payout
Schwab Health Care Fund	Schwab Monthly Income Fund - Maximum Payout

The Schwab MarketTrack Portfolios are primarily “fund of funds”. Each of the funds seeks to achieve its investment objective by investing mainly in a combination of other Schwab Funds (underlying funds) in accordance with its target portfolio allocation. The funds may also invest directly in equity or fixed income securities, cash equivalents and futures to achieve their investment objectives. Each fund bears its share of the allocable expenses of the underlying funds in which they invest.

Schwab MarketTrack All Equity Portfolio, Schwab MarketTrack Balanced Portfolio and Schwab MarketTrack Conservative Portfolio each offer one share class. Through December 6, 2012, Schwab MarketTrack Growth Portfolio offered two share classes: Investor Shares and P Shares. Shares of each class represented an interest in the same fund, but each class had different expenses and investment minimums. At a Board of Trustees meeting held on December 4, 2012, the Board approved the termination of MarketTrack Growth Portfolio’s P Shares. Effective December 6, 2012, the P Share class was terminated. Shares are bought and sold (subject to a redemption fee, see financial note 8) at closing net asset value per share (“NAV”) which is the price for all outstanding shares of the fund. Each share has a par value of 1/1,000 of a cent, and the funds’ Board of Trustees (the “Board”) may authorize the issuance of as many shares as necessary.

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 may also keep certain assets in segregated accounts, as required by securities law.

2. Significant Accounting Policies:

The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). For more information about the underlying funds’ operations and policies, please refer to those funds’ semiannual and annual reports, which are filed with the Securities Exchange Commission (“SEC”).

(a) Security Valuation:

Under procedures approved by the Board, the investment adviser has formed a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

31

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

The funds value the securities in their portfolios every business day. The funds use the following policies to value various types of securities:

•  Underlying funds: Mutual funds are valued at their respective net asset values.

•  Securities for which no quoted value is available: The Board has adopted procedures to fair value each fund’s securities when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a price; or when a security’s primary trading market is closed during regular market hours. Each fund makes fair value determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ techniques such as the review of related or comparable assets or liabilities, related market activities, recent transactions, market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing Committee regularly reviews these inputs and assumptions to calibrate the valuations. Due to the subjective and variable nature of fair value pricing, there can be no assurance that a fund could obtain the fair value assigned to the security upon the sale of such security. The Board convenes on a regular basis to review fair value determinations made by the funds pursuant to the valuation procedures.

•  Short-term securities (60 days or less to maturity): Short-term securities are valued at amortized cost, which approximates market value.

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). If inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the valuation. If the funds determine that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value.

The three levels of the fair value hierarchy are as follows:

•  Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities. Investments in mutual funds are valued daily at their NAVs, which are classified as Level 1 prices.

•  Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and state, municipal and provincial obligations. As investments whose values are classified as Level 2 prices include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

•  Level 3 — significant unobservable inputs (including the funds’ own assumptions in determining the fair value of investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may trade infrequently or not at all. When observable prices are not available for these securities, the funds use one or more valuation techniques for which sufficient and reliable data is available. The inputs used by the funds in estimating the value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the funds in the absence of market information. Assumptions used by the funds due to the lack of observable inputs may significantly impact the resulting fair value and therefore the funds’ results of operations.

32 

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

2. Significant Accounting Policies (continued):

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The levels associated with valuing the funds’ investments as of April 30, 2013 are disclosed in the Portfolio Holdings.

(b) Security Transactions:

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains or losses from security transactions are based on the identified costs of the securities involved.

(c) Investment Income:

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds 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. Any distributions from underlying funds are recorded in accordance with the character of the distributions as designated by the underlying funds.

(d) Expenses:

Expenses that are specific to a fund are charged directly to the fund. Expenses that are common to all funds within the trust generally are allocated among the funds in proportion to their average daily net assets.

(e) Distributions to Shareholders:

The funds make distributions from net investment income and net realized capital gains, if any, once a year, except for the Schwab MarketTrack Conservative Portfolio, which makes distributions from net investment income quarterly.

(f) Accounting Estimates:

The accounting policies described in this report conform to GAAP. 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 and these differences may be material.

(g) Federal Income Taxes:

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 except for the Schwab MarketTrack Conservative Portfolio, which typically makes distributions at the end of every calendar quarter. As long as a fund meets the tax requirements, it is not required to pay federal income tax.

(h) Indemnification:

Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk of loss attributable to these arrangements to be remote.

(i) New Accounting Pronouncements:

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative instruments. Management is currently evaluating the impact the adoption of ASU No. 2011-11 may have on the funds’ financial statement disclosures.

33

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

3. Risk Factors:

Investing in the funds may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those described below. Any of these risks could cause an investor to lose money.

Asset Allocation Risk. The funds are subject to asset allocation risk, which is the risk that the selection of the underlying funds and the allocation of a fund’s assets among the various asset classes and market segments will cause the funds to underperform other funds with a similar investment objective.

Affiliated Fund Risk. The investment adviser’s authority to select and substitute underlying funds from a variety of affiliated and unaffiliated mutual funds may create a conflict of interest because the fees paid to it by some underlying funds are higher than the fees paid by other underlying funds. However, the portfolio manager is a fiduciary to the fund and is legally obligated to act in the fund’s best interests when selecting underlying funds, without taking fees into consideration.

Market Risk. Stock and bond markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of an investment in the funds will fluctuate, which means that an investor could lose money.

Underlying Fund Investment Risk. The value of your investment in the funds is based primarily on the prices of the underlying funds that the fund purchases. In turn, the price of each underlying fund is based on the value of its securities. Before investing in the funds, investors should assess the risks associated with the underlying funds in which the funds may invest and the types of investments made by those underlying funds. These risks include any combination of the risks described below, although a fund’s exposure to a particular risk will be proportionate to the fund’s overall asset allocation and underlying fund allocation.

•  Investment Risk. An investment in an underlying fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The funds may experience losses with respect to their investment in an underlying fund. Further, there is no guarantee that an underlying fund will be able to achieve its objective.

•  Investment Style Risk. The underlying funds seek to track the performance of various segments of the stock market, as measured by their respective indices. Each underlying fund follows these stocks during upturns as well as downturns. Because of their indexing strategy, the underlying funds do not take steps to reduce market exposure or to lessen the effects of a declining market. In addition, because of an underlying fund’s expenses, the underlying fund’s performance is normally below that of the index.

•  Equity Risk. The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices to fall over short or extended periods of time.

•  Tracking Error Risk. Each underlying index fund seeks to track the performance of its benchmark index, although it may not be successful in doing so. The divergence between the performance of a fund and its benchmark index, positive or negative, is called “tracking error.” Tracking error can be caused by many factors and it may be significant.

•  Large-Cap Risk. Many of the risks of the underlying funds are associated with their investment in the large-cap segments of the stock market. Large-cap stocks tend to go in and out of favor based on market and economic conditions. During a period when large-cap stocks fall behind other types of investments - bonds or mid- or small- cap stocks, for instance - an underlying fund’s large-cap holdings could reduce performance.

•  Small-Cap Risk. Historically, small-cap stocks have been riskier than large- and mid-cap stocks, and their prices may move sharply, especially during market upturns and downturns. Small-cap companies may be more vulnerable to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall behind other types of investments - bonds or large-cap stocks, for instance - an underlying fund’s small-cap holdings could reduce performance.

•  Foreign Investment Risk. An underlying fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may be heightened in connection with investments in emerging markets.

34 

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

3. Risk Factors (continued):

•  Currency Risk. As a result of an underlying fund’s investments in securities denominated in, and/or receiving revenues in foreign currencies, the fund will be subject to currency risk. This is the risk that those currencies will decline in value relative to the U.S. dollar, or, in the case of hedging positions, that the U.S. dollar will decline in value relative to the currency hedged. In either event, the dollar value of an investment in a fund would be adversely affected.

•  Derivatives Risk. An underlying fund’s use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments and could cause the fund to lose more than the principal amount invested.

•  Exchange-Traded Funds (ETFs) Risk. When a fund invests in an ETF, it will bear a proportionate share of the ETF’s expenses. In addition, lack of liquidity in an ETF can result in its value being more volatile than the underlying portfolio of securities.

•  Debt Securities Risk. Bond prices generally fall when interest rates rise. Bonds with longer maturities tend to be more sensitive to this risk. Underlying fund performance also could be affected if an issuer or guarantor of a bond held by the fund fails to make timely principal or interest payments or otherwise honor its obligations. Lower-quality bonds are considered speculative with respect to their issuer’s ability to make timely payments or otherwise honor their obligations. In addition, prices of lower-quality bonds tend to be more volatile than those of investment-grade bonds, and may fall based on bad news about the issuer, an industry or the overall economy.

•  Liquidity Risk. A particular investment may be difficult to purchase or sell. An underlying fund may be unable to sell illiquid securities at an advantageous time or price.

•  Securities Lending Risk. An underlying fund may lend its portfolio securities to brokers, dealers, and other financial institutions. Securities lending involves the risk of loss of rights in the collateral or delay in recovery of the collateral if the borrower fails to return the security loaned or becomes insolvent.

Direct Investment Risk. A fund may invest directly in individual securities as well as other mutual funds or ETFs, to maintain its allocations. A fund’s direct investment in these securities is subject to the same or similar risks as an underlying fund’s investment in the same security.

Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds.

4. Affiliates and Affiliated Transactions:

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles Schwab Corporation, serves as each fund’s investment adviser and administrator pursuant to an Investment Advisory and Administration Agreement (“Advisory Agreement”) between CSIM and the trust.

For its advisory and administrative services to each fund, CSIM is entitled to receive an annual fee of 0.23% payable monthly based on each fund’s average daily net assets.

The Board has adopted a Shareholder Servicing Plan (the “Plan”) on behalf of the funds. The Plan enables each fund to bear expenses relating to the provision by service providers, including Charles Schwab & Co., Inc. (a broker-dealer affiliate of CSIM, “Schwab”), of certain account maintenance, customer liaison and shareholder services to the current shareholders of the funds. Schwab serves as the funds’ paying agent under the Plan for making payments of the shareholder service fee due to the service providers (other than Schwab). All shareholder service fees paid by the funds to Schwab in its capacity as the funds’ paying agent will be passed through to the service providers, and Schwab will not retain any portion of such fees.

Pursuant to the Plan, each fund’s shares are subject to an annual shareholder servicing fee up to 0.25%. The shareholder servicing fee paid to a particular service provider is made pursuant to its written agreement with Schwab (or, in the case of payments made to Schwab, pursuant to Schwab’s written agreement with the funds). Payments under the Plan are made as described above regardless of Schwab’s or the service provider’s actual cost of providing the services. If the cost of providing the services under the Plan is less than the payments received, the unexpended portion of the fees may be retained as profit by Schwab or the service provider.

Although these agreements specify certain fees for these services, CSIM and its affiliates have made an additional agreement with the funds, for so long as CSIM serves as the investment adviser to the funds, which may only be amended or terminated with

35

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

the approval of the Board, to limit the total annual fund operating expenses charged, excluding interest, taxes and certain non-routine expenses (“expense limitation”). The expense limitation as a percentage of average daily net assets is as follows:

Schwab		Schwab		Schwab		Schwab
MarketTrack		MarketTrack		MarketTrack		MarketTrack
All Equity		Growth		Balanced		Conservative
Portfolio		Portfolio		Portfolio		Portfolio
	0.50%		0.50%		0.50%		0.50%

The agreement to limit the funds’ total expenses charged is limited to each fund’s direct operating expenses and, therefore, does not apply to underlying fund fees and expenses, which are indirect expenses incurred by a fund through its investments in the underlying funds.

The funds may engage in certain transactions involving related parties. Pursuant to an exemptive order issued by the SEC, the funds may invest in other related funds. As of April 30, 2013, the percentages of shares of other related funds owned by each Schwab MarketTrack Portfolio are:

	Schwab		Schwab		Schwab		Schwab
	MarketTrack		MarketTrack		MarketTrack		MarketTrack
	All Equity		Growth		Balanced		Conservative
	Portfolio		Portfolio		Portfolio		Portfolio
Schwab International Index Fund		9.1%		7.1%		3.9%		1.2%
Schwab S&P 500 Index Fund		1.6%		1.7%		0.9%		0.3%
Schwab Small-Cap Index Fund		6.6%		6.3%		3.5%		1.0%
Schwab Total Bond Market Fund		—%		9.8%		17.2%		12.0%
Schwab Value Advantage Money Fund		—%		0.1%		0.1%		0.0%	*

* Less than 0.05%

Below is a summary of the funds’ transactions with their affiliated underlying funds during the period ended April 30, 2013.

Schwab MarketTrack All Equity Portfolio:
	Balance							Balance				Realized		Distributions
	of Shares							of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12		11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13		to 04/30/13
Schwab International Index Fund		8,737,494		483,540		(472,682	)		8,748,352		$160,882,197		$237,616		$4,947,063
Schwab S&P 500 Index Fund		9,503,472		269,843		(122,775	)		9,650,540		241,360,017		189,904		4,662,134
Schwab Small-Cap Index Fund		5,551,212		276,371		(301,427	)		5,526,156		130,583,067		576,217		5,521,235
Total											$532,825,281		$1,003,737		$15,130,432

Schwab MarketTrack Growth Portfolio:
	Balance							Balance				Realized		Distributions
	of Shares							of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12		11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13		to 04/30/13
Schwab International Index Fund		7,071,253		364,556		(577,394	)		6,858,415		$126,126,247		$806,044		$3,952,606
Schwab S&P 500 Index Fund		10,227,080		254,780		(362,823	)		10,119,037		253,077,116		753,180		4,977,337
Schwab Small-Cap Index Fund		5,342,344		270,053		(340,438	)		5,271,959		124,576,401		875,744		5,253,467
Schwab Total Bond Market Fund		8,652,421		981,585		(296,375	)		9,337,631		90,575,017		51,472		1,003,379
Schwab Value Advantage Money Fund, Institutional Prime Shares		7,043,778		4,004,283		—			11,048,061		11,048,061		—		4,217
Total											$605,402,842		$2,486,440		$15,191,006

36 

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

4. Affiliates and Affiliated Transactions (continued):

Schwab MarketTrack Balanced Portfolio:
	Balance							Balance				Realized		Distributions
	of Shares							of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12		11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13		to 04/30/13
Schwab International Index Fund		3,962,723		183,464		(365,331	)		3,780,856		$69,529,942		$636,166		$2,224,157
Schwab S&P 500 Index Fund		5,736,144		202,112		(349,726	)		5,588,530		139,769,130		1,138,886		2,795,787
Schwab Small-Cap Index Fund		3,002,467		163,302		(263,961	)		2,901,808		68,569,724		973,024		2,947,001
Schwab Total Bond Market Fund		15,356,682		1,446,534		(513,658	)		16,289,558		158,008,711		21,587		1,771,880
Schwab Value Advantage Money Fund, Institutional Prime Shares		4,528,610		3,503,039		—			8,031,649		8,031,649		—		3,022
Total											$443,909,156		$2,769,663		$9,741,847

Schwab MarketTrack Conservative Portfolio:
	Balance							Balance				Realized		Distributions
	of Shares							of Shares		Market		Gains (Losses)		Received*
	Held at		Gross		Gross			Held at		Value at		11/01/12		11/01/12
Underlying Funds	10/31/12		Additions		Sales			04/30/13		04/30/13		to 04/30/13		to 04/30/13
Schwab International Index Fund		1,175,359		74,524		(134,209	)		1,115,674		$20,517,236		$213,891		$678,383
Schwab S&P 500 Index Fund		1,694,351		128,573		(162,267	)		1,660,657		41,533,039		456,394		851,733
Schwab Small-Cap Index Fund		882,000		73,271		(111,174	)		844,097		19,946,015		451,079		886,927
Schwab Total Bond Market Fund		10,701,111		1,124,708		(473,581	)		11,352,238		110,116,709		409		1,256,097
Schwab Value Advantage Money Fund, Institutional Prime Shares		1,985,302		1,501,322		—			3,486,624		3,486,624		—		1,313
Total											$195,599,623		$1,121,773		$3,674,453

* Distributions received include distributions from net investment income and capital gains, if any, from the underlying funds.

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with other Schwab Funds. All loans are for temporary or emergency purposes only. The interest rate to be charged on a loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending facility is subject to the oversight and periodic review by the Board. The funds had no interfund borrowing or lending activity during the period.

5. Board of Trustees:

The Board may include people who are officers and/or directors of the investment adviser or its affiliates. Federal securities law limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees, but it did pay non-interested persons (independent trustees), as noted in each fund’s Statement of Operations. For information regarding the trustees please refer to Trustees and Officers table at the end of this report.

6. Borrowing from Banks:

The funds have access to custodian overdraft facilities, a committed line of credit of $150 million with State Street Bank and Trust Company (“State Street”), an uncommitted line of credit of $100 million with Bank of America, N.A. and an uncommitted line of credit of $50 million with Brown Brothers Harriman & Co. The funds pay interest on the amounts they borrow at rates that are negotiated periodically. The funds also pay an annual fee to State Street for the committed line of credit.

There were no borrowings from the lines of credit by the funds during the period. However, the funds may have utilized their overdraft facility and incurred interest expense, which is disclosed in the Statement of Operations, if any. The interest expense is determined based on a negotiated rate above the current Federal Funds Rate.

37

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

7. Purchases and Sales/Maturities of Investment Securities:

For the period ended April 30, 2013, purchases and sales/maturities of securities (excluding short-term obligations) were as follows:

	Purchases of Securities		Sales/Maturities of Securities
Schwab MarketTrack All Equity Portfolio		$19,790,432		$17,515,000
Schwab MarketTrack Growth Portfolio		30,765,877		28,630,000
Schwab MarketTrack Balanced Portfolio		28,501,531		25,350,000
Schwab MarketTrack Conservative Portfolio		18,063,224		13,310,000

8. Redemption Fee:

The funds charge a 2.00% redemption fee on shares sold or exchanged within 30 days of the original purchase date. Such amounts are netted against redemption proceeds in the Statement of Changes in Net Assets. The redemption fees charged during the current and prior periods are:

	Current Period		Prior Period
	(11/1/12-4/30/13)		(11/1/11-10/31/12)
Schwab MarketTrack All Equity Portfolio		$2,774		$7,838
Schwab MarketTrack Growth Portfolio		1,818		20,976
Schwab MarketTrack Balanced Portfolio		1,598		2,893
Schwab MarketTrack Conservative Portfolio		1,705		4,280

9. Federal Income Taxes:

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of October 31, 2012, the funds had capital loss carryforwards available to offset future net capital gains before the expiration dates as follows:

	Schwab		Schwab		Schwab		Schwab
	MarketTrack		MarketTrack		MarketTrack		MarketTrack
	All Equity		Growth		Balanced		Conservative
Expiration Date	Portfolio		Portfolio		Portfolio		Portfolio
October 31, 2016		$11,526,446		$—		$—		$—
October 31, 2017		31,279,738		11,917,090		8,159,980		8,336,771
October 31, 2018		8,349,147		918,434		—		—
No expiration*		1,262,743		—		—		—
Total		$52,418,074		$12,835,524		$8,159,980		$8,336,771

* As a result of the passage of the Regulated Investment Company Modernization Act of 2010, capital losses incurred after December 31, 2010 may now be carried forward indefinitely, but must retain the character of the original loss. However, such losses must be utilized prior to the pre-enactment capital losses, which may increase the likelihood that the pre-enactment capital losses may expire unused. Under pre-enactment law, capital losses could be carried forward for eight years, and carried forward as short-term capital loss, irrespective of the character of the original loss.

For the year ended October 31, 2012, the funds had capital losses deferred and capital losses utilized as follows:

	Schwab		Schwab		Schwab		Schwab
	MarketTrack		MarketTrack		MarketTrack		MarketTrack
	All Equity		Growth		Balanced		Conservative
	Portfolio		Portfolio		Portfolio		Portfolio
Capital losses deferred		$—		$526,634		$—		$—
Capital losses utilized		—		18,018,499		6,437,506		2,706,067

As of October 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related

38 

 Schwab MarketTrack Portfolios

Financial Notes, unaudited (continued)

9. Federal Income Taxes (continued):

to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended October 31, 2012, the funds did not incur any interest or penalties.

10. Other:

The funds have a licensing agreement with Standard & Poor’s to use the S&P 500 Index for its large-cap investment allocations, as the funds may invest in stocks that comprise the index. The licensing fees incurred by the funds are presented on each fund’s Statement of Operations as an Index fee.

11. Subsequent Events:

Management has determined there are no subsequent events or transactions through the date the financial statements were issued that would have materially impacted the financial statements as presented.

39

Trustees and Officers

The tables below give information about the trustees and officers of Schwab Capital Trust, which includes the funds covered in this report. The “Fund Complex” includes The Charles Schwab Family of Funds, Schwab Capital Trust, Schwab Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The Fund Complex includes 94 funds.

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the trustees and officers in the funds’ Statement of Additional Information, which is available free by calling 1-800-435-4000.

 Independent Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Mariann Byerwalter 1960 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman of JDN Corporate Advisory LLC (advisory services firm) (Oct. 2001 – present).	77	Director,WageWorks, Inc. (2010 – present) Director, Redwood Trust, Inc. (1998 – present) Director, PMI Group Inc. (2001 – 2009)
John F. Cogan 1947 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Fellow, The Hoover Institution at Stanford University (Oct. 1979 – present); Senior Fellow, Stanford Institute for Economic Policy Research; Professor of Public Policy, Stanford University (Sept. 2000 – present).	77	Director, Gilead Sciences, Inc. (2005 – present) Director, Monaco Coach Corporation (2005 – 2009)
William A. Hasler 1941 Trustee (Trustee of Schwab Capital Trust since 2000.)	Dean Emeritus, Haas School of Business, University of California, Berkeley (July 1998 – present).	77	Director, TOUSA (1998 – present) Director, Globalstar, Inc. (2009 – present) Director, Aviat Networks (2001 – present) Director, Mission West Properties (1998 – 2012) Director, Ditech Networks Corporation (1997 – 2012) Director, Genitope Corporation (2000 – 2009)
David L. Mahoney 1954 Trustee (Trustee of Schwab Capital Trust since 2011.)	Private Investor.	77	Director, Symantec Corporation (2003 – present) Director, Corcept Therapeutics Incorporated (2004 – present) Director, Tercica Inc. (2004 – 2008)
Kiran M. Patel 1948 Trustee (Trustee of Schwab Capital Trust since 2011.)	Executive Vice President and General Manager of Small Business Group, Intuit, Inc. (financial software and services for consumers and small businesses) (Dec. 2008 – present); Senior Vice President and General Manager of Consumer Group, Intuit, Inc. (June 2007 – Dec. 2008); Senior Vice President and Chief Financial Officer, Intuit, Inc. (Sept. 2005 – Jan. 2008).	77	Director, KLA-Tencor Corporation (2008 – present) Director, BEA Systems, Inc. (2007 – 2008)
Gerald B. Smith 1950 Trustee (Trustee of Schwab Capital Trust since 2000.)	Chairman, Chief Executive Officer and Founder of Smith Graham & Co. (investment advisors) (1990 – present).	77	Director and Chairman of the Audit Committee, Oneok Partners LP (2003 – present) Director, Oneok, Inc (2009 – present) Lead Independent Director, Board of Cooper Industries (2002 – 2012)

40 

 Independent Trustees (continued)

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served1)	During the Past Five Years	the Trustee	Other Directorships
Joseph H. Wender 1944 Trustee (Trustee of Schwab Capital Trust since 2008.)	Senior Consultant, Goldman Sachs & Co., Inc. (Jan. 2008- present); Partner, Colgin Partners, LLC (vineyards) (February 1998 – present).	77	Board Member and Chairman of the Audit Committee, Isis Pharmaceuticals (1994 – present)

 Interested Trustees

Name, Year of Birth,		Number of
and Position(s) with		Portfolios in
the trust; (Terms of		Fund Complex
office, and length of	Principal Occupations	Overseen by
Time Served )	During the Past Five Years	the Trustee	Other Directorships
Charles R. Schwab2 1937 Chairman and Trustee (Chairman and Trustee of Schwab Capital Trust since 1993.)	Chairman and Director, The Charles Schwab Corporation, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc., Charles Schwab Bank, N. A.; Chairman and Chief Executive Officer, Schwab (SIS) Holdings Inc. I, Schwab International Holdings, Inc.; Chief Executive Officer, Schwab Holdings, Inc.; Through June 2007, Director, U.S. Trust Company, N. A., U.S. Trust Corporation, United States Trust Company of New York. Until October 2008, Chief Executive Officer, The Charles Schwab Corporation, Charles Schwab & Co., Inc.	77	None
Walter W. Bettinger II2 1960 Trustee (Trustee of Schwab Capital Trust since 2008.)	As of October 2008, President and Chief Executive Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. Since October 2008, Director, The Charles Schwab Corporation. Since May 2008, Director, Charles Schwab & Co., Inc. and Schwab Holdings, Inc. Since 2006, Director, Charles Schwab Bank. Until October 2008, President and Chief Operating Officer, Charles Schwab & Co., Inc. and The Charles Schwab Corporation. From 2004 through 2007, Executive Vice President and President, Schwab Investor Services. From 2004 through 2005, Executive Vice President and Chief Operating Officer, Individual Investor Enterprise, and from 2002 through 2004, Executive Vice President, Corporate Services.	94	None

 Officers of the Trust

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
Marie Chandoha 1961 President and Chief Executive Officer (Officer of Schwab Capital Trust since 2010.)	Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer (Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President and Chief Executive Officer (Dec. 2010 – present) and Chief Investment Officer (Dec. 2010 – Oct. 2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 2007 – August 2010).

41

 Officers of the Trust (continued)

Name, Year of Birth, and Position(s)
with the trust; (Terms of office, and
length of Time Served3)	Principal Occupations During the Past Five Years
George Pereira 1964 Treasurer and Principal Financial Officer (Officer of Schwab Capital Trust since 2004.)	Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab Asset Management (Ireland) Limited (April 2005 – present).
Omar Aguilar 1970 Senior Vice President and Chief Investment Officer – Equities (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Equities, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the Portfolio Management Group and Vice President of Portfolio Management, Financial Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment Management (July 2004 – Jan. 2009).
Brett Wander 1961 Senior Vice President and Chief Investment Officer – Fixed Income (Officer of Schwab Capital Trust since 2011.)	Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 2011 – present); Senior Managing Director, Global Head of Active Fixed-Income Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head of Market-Based Strategies, State Street Research (August 2003 – Jan. 2005).
David Lekich 1964 Secretary and Chief Legal Officer (Officer of Schwab Capital Trust since 2011.)	Senior Vice President (Sept. 2011 – present), Vice President (March 2004 – Sept. 2011), Charles Schwab & Co., Inc.; Senior Vice President and Chief Counsel (Sept. 2011 – present), Vice President (Jan. 2011 – Sept. 2011), Charles Schwab Investment Management, Inc.; Secretary (April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds; Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab ETFs.
Catherine MacGregor 1964 Vice President (Officer of Schwab Capital Trust since 2005.)	Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. (July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk (March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant Secretary, Schwab ETFs (Oct. 2009 – present).

1	Trustees remain in office until they resign, retire or are removed by shareholder vote. The Schwab Funds® retirement policy requires that independent trustees elected after January 1, 2000 retire at age 72 or after twenty years as a trustee, whichever comes first. In addition, the Schwab Funds retirement policy also requires any independent trustee of the Schwab Funds who also serves as an independent trustee of the Laudus Funds to retire from the Boards of the Schwab Funds upon their required retirement date from either the Boards of Trustees of the Schwab Funds or the Laudus Funds, whichever comes first.
2	Mr. Schwab and Mr. Bettinger are Interested Trustees because they are employees of Schwab. In addition to their employment with Schwab, Messrs. Schwab and Bettinger also own stock of The Charles Schwab Corporation, the parent company of Schwab and the investment adviser.
3	The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board.

42 

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.

Barclays U.S. Aggregate Bond Index A broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-back securities (agency fixed-rate and hybrid ARM passthroughs), asset-backed securities, and commercial mortgage-backed securities.

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.”

An individual bond is subject to the credit risk of the issuer. Changes in interest rates can affect a bond’s market value prior to call or maturity. There is no guarantee that a bond’s yield to call or maturity will provide a positive return over the rate of inflation.

bond fund A bond fund is subject to the same credit, interest rate, and inflation risks as bonds. In addition, a bond fund incurs ongoing fees and expenses. A bond fund’s net asset value will fluctuate with the price of the underlying bonds and the portfolio turnover activity; return of principal is not guaranteed.

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.

Citigroup Non-U.S. Dollar World Government Bond Index An index that measures the total rate of return performance for the government bonds of 23 countries, excluding the U.S., with a remaining maturity of at least one year.

Dow Jones U.S. Total Stock Market Index An index that measures the performance of all U.S. equity securities with readily available prices.

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.

MSCI EAFE Index A free float-adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. & Canada.

MSCI Emerging Markets Index A free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets.

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.

Russell 1000 Index An index that measures the performance of the large-cap segment of the U.S. equity universe.

Russell 2000 Index An index that measures the performance of the small-cap segment of the U.S. equity universe.

S&P 500 Index A market capitalization index that is designed to measure the performance of 500 leading publicly held companies in leading industries of the U.S. economy.

stock A share of ownership, or equity, in the issuing company.

total return The percentage that an investor would have earned or lost on an investment in the fund assuming dividends and distributions were reinvested.

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.

43

Notes

Schwab Funds^® offers you an extensive family of mutual funds, each one based on a clearly defined investment approach and using disciplined management strategies. The list at right shows all currently available Schwab Funds.

Whether you are an experienced investor or just starting out, Schwab Funds can help you achieve your financial goals. An investor should consider a fund’s investment objectives, risks, charges and expenses carefully before investing or sending money. This and other important information can be found in the fund’s prospectus. Please call 1-800-435-4000 for a prospectus and brochure for any Schwab Fund. Please read the prospectus carefully before you invest. This report must be preceded or accompanied by a current prospectus.

Proxy Voting Policies, Procedures and Results

A description of the proxy voting policies and procedures used to determine how to vote proxies on behalf of the funds is available without charge, upon request, by visiting Schwab’s website at www.schwabfunds.com/prospectus, the SEC’s website at http://www.sec.gov, or by contacting Schwab Funds at 1-800-435-4000.

Information regarding how a fund voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available, without charge, by visiting the fund’s website at www.schwabfunds.com/prospectus or the SEC’s website at http://www.sec.gov.

The Schwab Funds Family^®

Stock Funds

Schwab Core Equity Fund^tm

Schwab Dividend Equity Fund^tm

Schwab Large-Cap Growth Fund^tm

Schwab Small-Cap Equity Fund^tm

Schwab Hedged Equity Fund^tm

Schwab Financial Services Fund^tm

Schwab Health Care Fund^tm

Schwab^® International Core Equity Fund

Schwab Fundamental US Large Company Index Fund

Schwab Fundamental US Small Company Index Fund

Schwab Fundamental International Large Company Index Fund

Schwab Fundamental International Small Company Index Fund

Schwab Fundamental Emerging Markets Large Company Index Fund

Schwab Global Real Estate Fund^tm

Schwab^® S&P 500 Index Fund

Schwab 1000 Index^® Fund

Schwab Small-Cap Index Fund^®

Schwab Total Stock Market Index Fund^®

Schwab International Index Fund^®

Asset Allocation Funds

Schwab Balanced Fund^tm

Schwab MarketTrack All Equity Portfolio^tm

Schwab MarketTrack Growth Portfolio^tm

Schwab MarketTrack Balanced Portfolio^tm

Schwab MarketTrack Conservative Portfolio^tm

Schwab Target 2010 Fund

Schwab Target 2015 Fund

Schwab Target 2020 Fund

Schwab Target 2025 Fund

Schwab Target 2030 Fund

Schwab Target 2035 Fund

Schwab Target 2040 Fund

Schwab Target 2045 Fund

Schwab Target 2050 Fund

Schwab Target 2055 Fund

Schwab^® Monthly Income Fund – Moderate Payout

Schwab^® Monthly Income Fund – Enhanced Payout

Schwab^® Monthly Income Fund – Maximum Payout

Bond Funds

Schwab Short-Term Bond Market Fund^tm

Schwab Intermediate-Term Bond Fund^tm

Schwab Total Bond Market Fund^tm

Schwab GNMA Fund^tm

Schwab^® Treasury Inflation Protected Securities Index Fund

Schwab Tax-Free Bond Fund^tm

Schwab California Tax-Free Bond Fund^tm

Schwab Money Funds

Schwab offers an array of money market funds¹. Choose from taxable or tax-advantaged alternatives. Many can be linked to your eligible Schwab account to “sweep” cash balances automatically, subject to availability, when you’re between investments. Or, for your larger cash reserves, choose one of our Value Advantage Investments^®.

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.

Investment Adviser

Charles Schwab Investment Management, Inc.

211 Main Street, San Francisco, CA 94105

Funds

Schwab Funds^®

P.O. Box 3812, Englewood, CO 80155–3812

This report is not authorized for distribution to prospective investors

unless preceded or accompanied by a current prospectus.

^© 2013 Charles Schwab & Co., Inc. All rights reserved.

Member SIPC^®

Printed on recycled paper.

MFR13559-16

00098631

Item 2: Code of Ethics.

Not applicable to this semi-annual report.

Item 3: Audit Committee Financial Expert.

Not applicable to this semi-annual report.

Item 4: Principal Accountant Fees and Services.

Not applicable to this semi-annual report.

Item 5: Audit Committee of Listed Registrants.

Not applicable.

Item 6: Schedule of Investments.

Except as noted below, the schedules of investments are included as part of the report to shareholders filed under Item 1 of this Form. The schedules of investments for the Schwab Fundamental US Large Company Index Fund, Schwab Fundamental US Small-Mid Company Index Fund, Schwab Fundamental International Large Company Index Fund, Schwab Fundamental International Small Company Index Fund, Schwab Fundamental Emerging Markets Index Fund, Schwab S&P 500 Index Fund, Schwab Small-Cap Index Fund, Schwab Total Stock Market Index Fund and Schwab International Index Fund are filed under this Item.

 Schwab S&P 500 Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.0%	Common Stock		9,633,343,832		14,527,448,671
	2	.8%	Short-Term Investments		413,721,414		413,721,414
	99	.8%	Total Investments		10,047,065,246		14,941,170,085
	0	.2%	Collateral Invested for Securities on Loan		22,835,155		22,835,155
	0	.0%	Other Assets and Liabilities, Net				3,914,977
	100	.0%	Net Assets				14,967,920,217

	Number		Value
Security	of Shares		($)
Common Stock 97.0% of net assets
Automobiles & Components 0.8%
BorgWarner, Inc. *		120,700		9,435,119
Delphi Automotive plc		292,600		13,521,046
Ford Motor Co.		3,999,897		54,838,588
Harley-Davidson, Inc.		231,470		12,649,835
Johnson Controls, Inc.		700,459		24,523,070
The Goodyear Tire & Rubber Co. *		233,336		2,915,533
				117,883,191
Banks 2.7%
BB&T Corp.		718,913		22,120,953
Comerica, Inc.		188,270		6,824,787
Fifth Third Bancorp		904,029		15,395,614
First Horizon National Corp.		238,860		2,484,144
Hudson City Bancorp, Inc.		481,992		4,005,353
Huntington Bancshares, Inc.		821,893		5,892,973
KeyCorp		941,198		9,383,744
M&T Bank Corp.		129,198		12,945,639
People’s United Financial, Inc.		343,300		4,517,828
PNC Financial Services Group, Inc.		537,278		36,470,431
Regions Financial Corp.		1,415,445		12,017,128
SunTrust Banks, Inc.		560,816		16,403,868
U.S. Bancorp		1,898,628		63,186,340
Wells Fargo & Co.		4,998,909		189,858,564
Zions Bancorp		174,698		4,301,065
				405,808,431
Capital Goods 7.3%
3M Co.		647,319		67,780,772
Caterpillar, Inc.		667,962		56,556,342
Cummins, Inc.		182,562		19,422,771
Danaher Corp.		590,874		36,007,861
Deere & Co.		395,286		35,299,040
Dover Corp.		174,270		12,021,145
Eaton Corp. plc		480,438		29,503,698
Emerson Electric Co.		729,215		40,478,725
Fastenal Co.		283,398		13,900,672
Flowserve Corp.		50,100		7,921,812
Fluor Corp.		160,582		9,149,962
General Dynamics Corp.		339,860		25,136,046
General Electric Co.		10,604,052		236,364,319
Honeywell International, Inc.		799,329		58,782,655
Illinois Tool Works, Inc.		426,236		27,517,796
Ingersoll-Rand plc		277,800		14,945,640
Jacobs Engineering Group, Inc. *		137,934		6,962,908
Joy Global, Inc.		100,000		5,652,000
L-3 Communications Holdings, Inc.		105,783		8,594,869
Lockheed Martin Corp.		266,091		26,366,957
Masco Corp.		347,388		6,753,223
Northrop Grumman Corp.		242,467		18,364,451
PACCAR, Inc.		351,050		17,475,269
Pall Corp.		107,030		7,139,971
Parker Hannifin Corp.		155,336		13,758,109
Pentair Ltd.		208,982		11,358,172
Precision Castparts Corp.		149,327		28,564,762
Quanta Services, Inc. *		231,900		6,372,612
Raytheon Co.		331,388		20,340,595
Rockwell Automation, Inc.		142,421		12,074,452
Rockwell Collins, Inc.		147,405		9,274,723
Roper Industries, Inc.		97,200		11,629,980
Snap-on, Inc.		58,282		5,023,908
Stanley Black & Decker, Inc.		166,181		12,432,001
Textron, Inc.		292,004		7,519,103
The Boeing Co.		694,054		63,443,476
United Technologies Corp.		860,035		78,512,595
W.W. Grainger, Inc.		61,727		15,213,854
Xylem, Inc.		173,800		4,822,950
				1,088,440,196
Commercial & Professional Supplies 0.6%
Avery Dennison Corp.		103,076		4,272,500
Cintas Corp.		111,376		4,997,441
Equifax, Inc.		119,661		7,323,253
Iron Mountain, Inc.		162,560		6,154,522
Pitney Bowes, Inc. (b)		196,591		2,687,399
Republic Services, Inc.		299,934		10,221,751
Robert Half International, Inc.		139,442		4,576,486
Stericycle, Inc. *		83,900		9,088,048
The ADT Corp. *		227,100		9,910,644
The Dun & Bradstreet Corp.		46,500		4,112,925
Tyco International Ltd.		480,900		15,446,508
Waste Management, Inc.		454,916		18,642,458
				97,433,935

See financial notes 1

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Consumer Durables & Apparel 1.2%
Coach, Inc.		278,728		16,405,930
D.R. Horton, Inc.		285,216		7,438,433
Fossil, Inc. *		54,900		5,386,788
Garmin Ltd. (b)		107,000		3,753,560
Harman International Industries, Inc.		64,756		2,895,241
Hasbro, Inc.		121,717		5,765,734
Leggett & Platt, Inc.		157,894		5,090,503
Lennar Corp., Class A		171,818		7,082,338
Mattel, Inc.		357,094		16,304,912
Newell Rubbermaid, Inc.		276,450		7,281,693
NIKE, Inc., Class B		742,124		47,199,087
PulteGroup, Inc. *		328,586		6,897,020
PVH Corp.		78,000		9,001,980
Ralph Lauren Corp.		62,826		11,407,945
VF Corp.		90,291		16,091,662
Whirlpool Corp.		83,322		9,522,038
				177,524,864
Consumer Services 1.8%
Apollo Group, Inc., Class A *		109,790		2,016,842
Carnival Corp.		456,921		15,768,344
Chipotle Mexican Grill, Inc. *		30,000		10,895,700
Darden Restaurants, Inc.		128,248		6,621,444
H&R Block, Inc.		286,205		7,939,327
International Game Technology		280,660		4,757,187
Marriott International, Inc., Class A		254,872		10,974,788
McDonald’s Corp.		1,022,638		104,452,245
Starbucks Corp.		765,562		46,576,792
Starwood Hotels & Resorts Worldwide, Inc.		192,168		12,398,680
Wyndham Worldwide Corp.		148,464		8,919,717
Wynn Resorts Ltd.		78,500		10,778,050
Yum! Brands, Inc.		459,685		31,313,742
				273,412,858
Diversified Financials 6.6%
American Express Co.		973,041		66,565,735
Ameriprise Financial, Inc.		215,714		16,077,164
Bank of America Corp.		11,034,411		135,833,599
BlackRock, Inc.		127,800		34,058,700
Capital One Financial Corp.		589,574		34,065,586
Citigroup, Inc.		3,098,847		144,592,201
CME Group, Inc.		313,485		19,078,697
Discover Financial Services		524,873		22,957,945
E*TRADE Financial Corp. *		243,719		2,507,869
Franklin Resources, Inc.		139,335		21,549,551
IntercontinentalExchange, Inc. *		71,958		11,724,117
Invesco Ltd.		436,147		13,843,306
JPMorgan Chase & Co.		3,903,231		191,297,351
Legg Mason, Inc.		143,998		4,587,776
Leucadia National Corp.		290,151		8,962,764
Moody’s Corp.		188,529		11,471,990
Morgan Stanley		1,403,854		31,095,366
Northern Trust Corp.		225,818		12,176,107
NYSE Euronext		245,500		9,527,855
SLM Corp.		494,418		10,209,732
State Street Corp.		466,026		27,248,540
T. Rowe Price Group, Inc.		264,179		19,152,978
The Bank of New York Mellon Corp.		1,192,373		33,648,766
The Charles Schwab Corp. (a)		1,085,681		18,413,150
The Goldman Sachs Group, Inc.		446,969		65,288,762
The McGraw-Hill Cos., Inc.		276,967		14,986,684
The NASDAQ OMX Group, Inc.		119,900		3,534,652
				984,456,943
Energy 10.3%
Anadarko Petroleum Corp.		514,409		43,601,307
Apache Corp.		397,906		29,397,295
Baker Hughes, Inc.		452,863		20,555,452
Cabot Oil & Gas Corp.		217,100		14,773,655
Cameron International Corp. *		256,300		15,775,265
Chesapeake Energy Corp.		512,966		10,023,356
Chevron Corp.		1,981,134		241,718,160
ConocoPhillips		1,245,190		75,271,735
CONSOL Energy, Inc.		240,418		8,087,662
Denbury Resources, Inc. *		377,200		6,748,108
Devon Energy Corp.		387,858		21,355,462
Diamond Offshore Drilling, Inc.		65,300		4,512,230
Ensco plc, Class A		238,200		13,739,376
EOG Resources, Inc.		273,906		33,186,451
EQT Corp.		154,600		11,613,552
Exxon Mobil Corp.		4,568,741		406,572,262
FMC Technologies, Inc. *		246,300		13,374,090
Halliburton Co.		954,168		40,809,765
Helmerich & Payne, Inc.		118,300		6,934,746
Hess Corp.		305,040		22,017,787
Kinder Morgan, Inc.		647,644		25,322,880
Marathon Oil Corp.		721,452		23,569,836
Marathon Petroleum Corp.		335,326		26,276,145
Murphy Oil Corp.		184,892		11,479,944
Nabors Industries Ltd.		287,890		4,257,893
National Oilwell Varco, Inc.		428,324		27,935,291
Newfield Exploration Co. *		145,600		3,172,624
Noble Corp.		258,800		9,705,000
Noble Energy, Inc.		183,184		20,752,915
Occidental Petroleum Corp.		820,950		73,277,997
Peabody Energy Corp.		261,564		5,246,974
Phillips 66		634,395		38,666,375
Pioneer Natural Resources Co.		132,400		16,183,252
QEP Resources, Inc.		186,091		5,342,673
Range Resources Corp.		160,600		11,807,312
Rowan Cos. plc, Class A *		126,263		4,107,335
Schlumberger Ltd.		1,354,515		100,816,551
Southwestern Energy Co. *		366,500		13,714,430
Spectra Energy Corp.		675,909		21,311,411
Tesoro Corp.		138,207		7,380,254
The Williams Cos., Inc.		705,698		26,908,265
Valero Energy Corp.		568,940		22,939,661
WPX Energy, Inc. *		182,099		2,846,207
				1,543,088,941
Food & Staples Retailing 2.4%
Costco Wholesale Corp.		444,092		48,152,896
CVS Caremark Corp.		1,258,851		73,239,951
Safeway, Inc.		266,496		6,001,490

2 See financial notes

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Sysco Corp.		590,657		20,590,303
The Kroger Co.		536,147		18,432,734
Wal-Mart Stores, Inc.		1,705,702		132,567,159
Walgreen Co.		873,711		43,257,432
Whole Foods Market, Inc.		173,016		15,280,773
				357,522,738
Food, Beverage & Tobacco 6.0%
Altria Group, Inc.		2,034,491		74,279,266
Archer-Daniels-Midland Co.		662,899		22,498,792
Beam, Inc.		161,179		10,429,893
Brown-Forman Corp., Class B		149,692		10,553,286
Campbell Soup Co.		188,711		8,758,078
Coca-Cola Enterprises, Inc.		295,862		10,837,425
ConAgra Foods, Inc.		425,949		15,065,816
Constellation Brands, Inc., Class A *		175,065		8,639,458
Dean Foods Co. *		197,270		3,775,748
Dr Pepper Snapple Group, Inc.		203,200		9,922,256
General Mills, Inc.		659,380		33,245,940
H.J. Heinz Co.		328,143		23,764,116
Hormel Foods Corp.		144,300		5,955,261
Kellogg Co.		249,234		16,210,179
Kraft Foods Group, Inc.		601,318		30,961,864
Lorillard, Inc.		389,091		16,688,113
McCormick & Co., Inc. - Non Voting Shares		132,602		9,539,388
Mead Johnson Nutrition Co.		205,300		16,647,777
Molson Coors Brewing Co., Class B		164,430		8,484,588
Mondelez International, Inc., Class A		1,815,054		57,083,448
Monster Beverage Corp. *		148,900		8,397,960
PepsiCo, Inc.		1,573,263		129,747,000
Philip Morris International, Inc.		1,675,746		160,184,560
Reynolds American, Inc.		327,596		15,534,602
The Coca-Cola Co.		3,908,656		165,453,409
The Hershey Co.		155,128		13,831,212
The JM Smucker Co.		106,275		10,970,768
Tyson Foods, Inc., Class A		277,090		6,824,727
				904,284,930
Health Care Equipment & Services 4.0%
Abbott Laboratories		1,591,686		58,765,047
Aetna, Inc.		347,780		19,976,483
AmerisourceBergen Corp.		247,246		13,380,954
Baxter International, Inc.		551,489		38,532,536
Becton, Dickinson & Co.		202,390		19,085,377
Boston Scientific Corp. *		1,434,274		10,742,712
C.R. Bard, Inc.		74,873		7,439,381
Cardinal Health, Inc.		348,833		15,425,395
CareFusion Corp. *		231,766		7,750,255
Cerner Corp. *		147,600		14,283,252
Cigna Corp.		293,308		19,408,190
Coventry Health Care, Inc.		138,985		6,886,707
Covidien plc		474,500		30,292,080
DaVita HealthCare Partners, Inc. *		81,900		9,717,435
DENTSPLY International, Inc.		132,400		5,607,140
Edwards Lifesciences Corp. *		115,800		7,386,882
Express Scripts Holding Co. *		834,695		49,555,842
Humana, Inc.		159,403		11,813,356
Intuitive Surgical, Inc. *		41,131		20,248,380
Laboratory Corp. of America Holdings *		89,691		8,373,552
McKesson Corp.		234,575		24,822,727
Medtronic, Inc.		1,031,339		48,142,905
Patterson Cos., Inc.		83,947		3,185,789
Quest Diagnostics, Inc.		156,880		8,837,050
St. Jude Medical, Inc.		301,387		12,423,172
Stryker Corp.		298,440		19,571,695
Tenet Healthcare Corp. *		112,904		5,121,326
UnitedHealth Group, Inc.		1,042,310		62,465,638
Varian Medical Systems, Inc. *		110,706		7,211,389
WellPoint, Inc.		313,629		22,869,827
Zimmer Holdings, Inc.		177,223		13,548,698
				602,871,172
Household & Personal Products 2.3%
Avon Products, Inc.		423,620		9,811,039
Colgate-Palmolive Co.		450,897		53,841,611
Kimberly-Clark Corp.		391,295		40,377,731
The Clorox Co.		133,057		11,476,166
The Estee Lauder Cos., Inc., Class A		250,252		17,354,976
The Procter & Gamble Co.		2,785,690		213,857,422
				346,718,945
Insurance 4.1%
ACE Ltd.		345,300		30,780,042
Aflac, Inc.		479,473		26,102,510
American International Group, Inc. *		1,505,554		62,360,047
Aon plc		311,450		18,796,007
Assurant, Inc.		89,346		4,247,509
Berkshire Hathaway, Inc., Class B *		1,860,030		197,758,389
Cincinnati Financial Corp.		155,203		7,590,979
Genworth Financial, Inc., Class A *		496,064		4,975,522
Hartford Financial Services Group, Inc.		448,595		12,601,033
Lincoln National Corp.		294,671		10,021,761
Loews Corp.		308,816		13,794,811
Marsh & McLennan Cos., Inc.		564,079		21,440,643
MetLife, Inc.		1,115,277		43,484,650
Principal Financial Group, Inc.		271,367		9,796,349
Prudential Financial, Inc.		474,731		28,683,247
The Allstate Corp.		476,210		23,458,105
The Chubb Corp.		267,893		23,593,336
The Progressive Corp.		541,420		13,692,512
The Travelers Cos., Inc.		387,560		33,101,499
Torchmark Corp.		95,511		5,928,368
Unum Group		276,440		7,709,912
XL Group plc		312,199		9,721,877
				609,639,108
Materials 3.3%
Air Products & Chemicals, Inc.		213,301		18,548,655

See financial notes 3

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Airgas, Inc.		75,000		7,248,750
Alcoa, Inc.		1,054,364		8,962,094
Allegheny Technologies, Inc.		101,170		2,729,567
Ball Corp.		152,738		6,738,801
Bemis Co., Inc.		116,535		4,585,652
CF Industries Holdings, Inc.		66,225		12,351,625
Cliffs Natural Resources, Inc. (b)		136,800		2,919,312
E.I. du Pont de Nemours & Co.		954,804		52,046,366
Eastman Chemical Co.		151,116		10,071,881
Ecolab, Inc.		270,828		22,917,465
FMC Corp.		134,200		8,145,940
Freeport-McMoRan Copper & Gold, Inc.		977,240		29,737,413
International Flavors & Fragrances, Inc.		80,543		6,217,114
International Paper Co.		451,389		21,206,255
LyondellBasell Industries N.V., Class A		388,700		23,594,090
MeadWestvaco Corp.		181,650		6,263,292
Monsanto Co.		546,500		58,377,130
Newmont Mining Corp.		512,646		16,609,730
Nucor Corp.		331,100		14,442,582
Owens-Illinois, Inc. *		157,500		4,139,100
PPG Industries, Inc.		147,048		21,636,643
Praxair, Inc.		302,179		34,539,060
Sealed Air Corp.		183,368		4,056,100
Sigma-Aldrich Corp.		127,254		10,013,617
The Dow Chemical Co.		1,228,235		41,649,449
The Mosaic Co.		283,200		17,442,288
The Sherwin-Williams Co.		88,636		16,230,138
United States Steel Corp. (b)		134,613		2,396,111
Vulcan Materials Co.		123,471		6,158,734
				491,974,954
Media 3.5%
Cablevision Systems Corp., Class A		220,000		3,269,200
CBS Corp., Class B - Non Voting Shares		588,236		26,929,444
Comcast Corp., Class A		2,688,164		111,021,173
DIRECTV *		594,202		33,608,065
Discovery Communications, Inc., Class A *		250,100		19,712,882
Gannett Co., Inc.		207,114		4,175,418
News Corp., Class A		2,039,901		63,175,734
Omnicom Group, Inc.		257,747		15,405,538
Scripps Networks Interactive, Class A		91,193		6,071,630
The Interpublic Group of Cos., Inc.		454,565		6,291,180
The Walt Disney Co.		1,841,183		115,699,940
The Washington Post Co., Class B		5,369		2,380,292
Time Warner Cable, Inc.		300,201		28,185,872
Time Warner, Inc.		948,174		56,681,842
Viacom Inc., Class B		467,853		29,937,914
				522,546,124
Pharmaceuticals, Biotechnology & Life Sciences 8.4%
AbbVie, Inc.		1,613,186		74,287,215
Actavis, Inc. *		125,746		13,295,124
Agilent Technologies, Inc.		341,166		14,137,919
Alexion Pharmaceuticals, Inc. *		195,700		19,178,600
Allergan, Inc.		314,658		35,729,416
Amgen, Inc.		771,159		80,362,479
Biogen Idec, Inc. *		242,491		53,088,555
Bristol-Myers Squibb Co.		1,659,364		65,909,938
Celgene Corp. *		428,713		50,618,144
Eli Lilly & Co.		1,021,623		56,577,482
Forest Laboratories, Inc. *		231,064		8,644,104
Gilead Sciences, Inc. *		1,552,550		78,621,132
Hospira, Inc. *		157,282		5,209,180
Johnson & Johnson		2,850,625		242,958,769
Life Technologies Corp. *		173,435		12,780,426
Merck & Co., Inc.		3,082,214		144,864,058
Mylan, Inc. *		404,751		11,782,302
PerkinElmer, Inc.		105,660		3,238,479
Perrigo Co.		95,800		11,439,478
Pfizer, Inc.		7,357,733		213,889,298
Regeneron Pharmaceuticals, Inc. *		75,000		16,135,500
Thermo Fisher Scientific, Inc.		359,137		28,975,173
Waters Corp. *		92,152		8,514,845
				1,250,237,616
Real Estate 2.2%
American Tower Corp.		402,000		33,763,980
Apartment Investment & Management Co., Class A		149,714		4,657,602
AvalonBay Communities, Inc.		115,999		15,432,507
Boston Properties, Inc.		157,076		17,188,827
CBRE Group, Inc., Class A *		307,440		7,446,197
Equity Residential		318,722		18,504,999
HCP, Inc.		465,300		24,800,490
Health Care REIT, Inc.		264,700		19,844,559
Host Hotels & Resorts, Inc.		763,011		13,940,211
Kimco Realty Corp.		421,159		10,015,161
Plum Creek Timber Co., Inc.		158,777		8,183,367
Prologis, Inc.		501,289		21,029,074
Public Storage		149,078		24,597,870
Simon Property Group, Inc.		319,853		56,956,224
Ventas, Inc.		292,800		23,315,664
Vornado Realty Trust REIT		178,456		15,625,607
Weyerhaeuser Co.		559,340		17,065,463
				332,367,802
Retailing 4.1%
Abercrombie & Fitch Co., Class A		78,745		3,902,602
Amazon.com, Inc. *		370,880		94,133,053
AutoNation, Inc. *		40,833		1,858,310
AutoZone, Inc. *		36,998		15,135,512
Bed Bath & Beyond, Inc. *		226,869		15,608,587
Best Buy Co., Inc.		296,557		7,707,516
CarMax, Inc. *		225,700		10,391,228
Dollar General Corp. *		277,600		14,460,184
Dollar Tree, Inc. *		230,600		10,967,336

4 See financial notes

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Expedia, Inc.		95,113		5,311,110
Family Dollar Stores, Inc.		92,430		5,672,429
GameStop Corp., Class A (b)		146,800		5,123,320
Genuine Parts Co.		158,838		12,124,105
J.C. Penney Co., Inc. (b)*		153,021		2,512,605
Kohl’s Corp.		213,210		10,033,663
L Brands, Inc.		249,635		12,584,100
Lowe’s Cos., Inc.		1,129,788		43,406,455
Macy’s, Inc.		399,926		17,836,700
Netflix, Inc. *		58,300		12,596,881
Nordstrom, Inc.		151,296		8,561,841
O’Reilly Automotive, Inc. *		116,800		12,534,976
PetSmart, Inc.		106,900		7,294,856
Priceline.com, Inc. *		50,858		35,396,659
Ross Stores, Inc.		221,300		14,621,291
Staples, Inc.		715,869		9,478,106
Target Corp.		663,708		46,831,236
The Gap, Inc.		294,662		11,194,209
The Home Depot, Inc.		1,524,750		111,840,412
The TJX Cos., Inc.		735,406		35,865,751
Tiffany & Co.		116,328		8,571,047
TripAdvisor, Inc. *		114,313		6,010,578
Urban Outfitters, Inc. *		111,100		4,603,984
				614,170,642
Semiconductors & Semiconductor Equipment 2.0%
Advanced Micro Devices, Inc. (b)*		559,039		1,576,490
Altera Corp.		329,046		10,532,762
Analog Devices, Inc.		314,454		13,832,831
Applied Materials, Inc.		1,262,472		18,318,469
Broadcom Corp., Class A		532,418		19,167,048
First Solar, Inc. *		47,800		2,225,568
Intel Corp.		5,043,905		120,801,525
KLA-Tencor Corp.		160,681		8,716,944
Lam Research Corp. *		181,374		8,383,106
Linear Technology Corp.		230,968		8,430,332
LSI Corp. *		573,376		3,749,879
Microchip Technology, Inc.		208,823		7,605,334
Micron Technology, Inc. *		1,044,275		9,837,071
NVIDIA Corp.		601,582		8,283,784
Teradyne, Inc. *		168,449		2,769,302
Texas Instruments, Inc.		1,133,254		41,035,127
Xilinx, Inc.		269,163		10,203,969
				295,469,541
Software & Services 9.2%
Accenture plc, Class A		657,100		53,514,224
Adobe Systems, Inc. *		495,676		22,345,074
Akamai Technologies, Inc. *		169,341		7,435,763
Autodesk, Inc. *		214,381		8,442,324
Automatic Data Processing, Inc.		498,373		33,560,438
BMC Software, Inc. *		162,339		7,383,178
CA, Inc.		370,925		10,003,847
Citrix Systems, Inc. *		184,808		11,489,513
Cognizant Technology Solutions Corp., Class A *		300,248		19,456,070
Computer Sciences Corp.		162,140		7,596,259
eBay, Inc. *		1,189,969		62,342,476
Electronic Arts, Inc. *		305,892		5,386,758
Fidelity National Information Services, Inc.		299,034		12,574,380
Fiserv, Inc. *		132,652		12,085,924
Google, Inc., Class A *		272,310		224,538,657
International Business Machines Corp.		1,069,390		216,594,250
Intuit, Inc.		284,809		16,986,009
MasterCard, Inc., Class A		107,676		59,537,291
Microsoft Corp.		7,687,731		254,463,896
Oracle Corp.		3,752,586		123,009,769
Paychex, Inc.		331,565		12,072,282
Red Hat, Inc. *		194,100		9,303,213
SAIC, Inc.		252,000		3,764,880
Salesforce.com, Inc. *		549,588		22,593,563
Symantec Corp. *		692,550		16,828,965
Teradata Corp. *		161,371		8,241,217
The Western Union Co.		630,625		9,339,556
Total System Services, Inc.		177,100		4,183,102
VeriSign, Inc. *		149,825		6,902,438
Visa, Inc., Class A		525,900		88,593,114
Yahoo! Inc. *		1,030,255		25,478,206
				1,376,046,636
Technology Hardware & Equipment 6.1%
Amphenol Corp., Class A		161,800		12,219,136
Apple, Inc.		957,638		423,994,224
Cisco Systems, Inc.		5,437,428		113,750,994
Corning, Inc.		1,500,787		21,761,411
Dell, Inc.		1,453,085		19,471,339
EMC Corp. *		2,144,245		48,095,415
F5 Networks, Inc. *		74,000		5,655,820
FLIR Systems, Inc.		149,700		3,639,207
Harris Corp.		129,300		5,973,660
Hewlett-Packard Co.		1,991,408		41,023,005
Jabil Circuit, Inc.		170,686		3,038,211
JDS Uniphase Corp. *		201,881		2,725,394
Juniper Networks, Inc. *		520,465		8,613,696
Molex, Inc.		126,666		3,492,182
Motorola Solutions, Inc.		282,922		16,183,138
NetApp, Inc. *		369,974		12,908,393
QUALCOMM, Inc.		1,752,165		107,968,407
SanDisk Corp. *		247,324		12,969,671
Seagate Technology plc		367,000		13,468,900
TE Connectivity Ltd.		416,600		18,142,930
Western Digital Corp.		223,300		12,344,024
Xerox Corp.		1,284,866		11,024,150
				918,463,307
Telecommunication Services 3.0%
AT&T, Inc.		5,600,236		209,784,841
CenturyLink, Inc.		645,643		24,256,807
Crown Castle International Corp. *		301,500		23,215,500
Frontier Communications Corp. (b)		937,945		3,901,851
Sprint Nextel Corp. *		3,071,908		21,656,951
Verizon Communications, Inc.		2,914,878		157,141,073
Windstream Corp.		565,074		4,814,431
				444,771,454

See financial notes 5

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Transportation 1.6%
C.H. Robinson Worldwide, Inc.		155,995		9,264,543
CSX Corp.		1,049,191		25,799,607
Expeditors International of Washington, Inc.		199,300		7,160,849
FedEx Corp.		298,268		28,040,175
Norfolk Southern Corp.		325,292		25,184,107
Ryder System, Inc.		60,702		3,524,965
Southwest Airlines Co.		753,336		10,320,703
Union Pacific Corp.		478,075		70,735,977
United Parcel Service, Inc., Class B		730,118		62,673,329
				242,704,255
Utilities 3.5%
AGL Resources, Inc.		129,640		5,684,714
Ameren Corp.		257,420		9,331,475
American Electric Power Co., Inc.		488,802		25,139,087
CenterPoint Energy, Inc.		448,566		11,070,609
CMS Energy Corp.		261,884		7,840,807
Consolidated Edison, Inc.		295,865		18,831,807
Dominion Resources, Inc.		582,964		35,957,219
DTE Energy Co.		178,612		13,017,243
Duke Energy Corp.		720,899		54,211,605
Edison International		338,593		18,216,303
Entergy Corp.		186,753		13,302,416
Exelon Corp.		869,893		32,629,686
FirstEnergy Corp.		433,794		20,214,800
Integrys Energy Group, Inc.		86,594		5,330,727
NextEra Energy, Inc.		428,638		35,161,175
NiSource, Inc.		302,662		9,300,803
Northeast Utilities		320,500		14,528,265
NRG Energy, Inc.		320,000		8,918,400
ONEOK, Inc.		200,400		10,292,544
Pepco Holdings, Inc.		250,100		5,652,260
PG&E Corp.		454,006		21,992,051
Pinnacle West Capital Corp.		104,861		6,386,035
PPL Corp.		601,770		20,087,083
Public Service Enterprise Group, Inc.		513,470		18,798,137
SCANA Corp.		129,800		7,035,160
Sempra Energy		232,869		19,293,197
TECO Energy, Inc.		194,819		3,726,887
The AES Corp.		623,349		8,639,617
The Southern Co.		893,525		43,094,711
Wisconsin Energy Corp.		224,900		10,107,006
Xcel Energy, Inc.		497,586		15,818,259
				529,610,088
Total Common Stock
(Cost $9,633,343,832)				14,527,448,671
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 2.8% of net assets
Time Deposits 2.6%
ANZ
0.03%, 05/01/13		73,313,151		73,313,151
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		33,039,694		33,039,694
CIBC
0.03%, 05/01/13		50,000,000		50,000,000
Skandinaviska Enskilda Banken
0.03%, 05/01/13		69,730,862		69,730,862
Societe Generale
0.03%, 05/01/13		164,340,451		164,340,451
				390,424,158
U.S. Treasury Obligations 0.2%
U.S. Treasury Bills
0.06%, 06/20/13 (c)(d)		200,000		199,983
0.09%, 06/20/13 (c)(d)		23,100,000		23,097,273
				23,297,256
Total Short-Term Investments
(Cost $413,721,414)				413,721,414
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.2% of net assets
Wells Fargo Advantage Government Money Market Fund		22,835,155		22,835,155
Total Collateral Invested for Securities on Loan
(Cost $22,835,155)				22,835,155
End of Collateral Invested for Securities on Loan.

At 04/30/13, tax basis cost of the fund’s investments was $10,091,186,702 and the unrealized appreciation and depreciation were $5,734,490,807 and ($884,507,424), respectively, with a net unrealized appreciation of $4,849,983,383.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	All or a portion of this security is on loan.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

6 See financial notes

 Schwab S&P 500 Index Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		5,100		406,011,000		12,275,825

See financial notes 7

 Schwab Small-Cap Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.7%	Common Stock		1,425,295,460		1,923,145,535
	0	.0%	Rights		—		—
	0	.0%	Warrants		—		2,758
	2	.5%	Short-Term Investments		48,008,019		48,008,019
	100	.2%	Total Investments		1,473,303,479		1,971,156,312
	4	.5%	Collateral Invested for Securities on Loan		89,167,306		89,167,306
	(4	.7)%	Other Assets and Liabilities, Net				(92,666,074	)
	100	.0%	Net Assets				1,967,657,544

	Number		Value
Security	of Shares		($)
Common Stock 97.7% of net assets
Automobiles & Components 0.9%
American Axle & Manufacturing Holdings, Inc. *		93,000		1,243,410
Cooper Tire & Rubber Co.		88,823		2,210,805
Dana Holding Corp.		209,000		3,605,250
Dorman Products, Inc.		36,000		1,358,640
Drew Industries, Inc.		27,500		992,750
Exide Technologies *		103,700		87,844
Federal-Mogul Corp. *		25,400		189,992
Fuel Systems Solutions, Inc. *		22,300		350,333
Gentherm, Inc. *		45,700		696,011
Modine Manufacturing Co. *		73,100		668,134
Shiloh Industries, Inc.		7,200		70,920
Spartan Motors, Inc.		44,700		237,804
Standard Motor Products, Inc.		28,800		882,432
Stoneridge, Inc. *		42,600		322,482
Superior Industries International, Inc.		31,400		576,504
Tenneco, Inc. *		85,900		3,321,753
Tower International, Inc. *		8,800		141,592
Winnebago Industries, Inc. *		44,000		806,080
				17,762,736
Banks 7.9%
1st Source Corp.		20,121		473,447
1st United Bancorp, Inc.		43,000		285,090
Access National Corp.		10,100		126,957
American National Bankshares, Inc.		10,700		232,511
Ameris Bancorp *		31,800		441,066
Ames National Corp. (c)		11,100		218,115
Arrow Financial Corp.		13,871		335,539
Astoria Financial Corp.		130,200		1,248,618
BancFirst Corp.		8,716		364,677
Banco Latinoamericano de Comercio Exterior, S.A., Class E		39,200		889,448
BancorpSouth, Inc.		138,800		2,220,800
Bank Mutual Corp.		61,600		319,088
Bank of Kentucky Financial Corp.		7,700		201,894
Bank of Marin Bancorp		7,100		281,160
Bank of the Ozarks, Inc.		42,600		1,743,618
BankFinancial Corp.		28,200		222,498
Banner Corp.		26,700		872,289
Bar Harbor Bankshares		5,300		190,800
BBCN Bancorp, Inc.		114,400		1,473,472
Beneficial Mutual Bancorp, Inc. *		44,503		380,501
Berkshire Bancorp, Inc.		8,700		75,081
Berkshire Hills Bancorp, Inc.		34,300		886,998
BofI Holding, Inc. *		15,500		632,090
Boston Private Financial Holdings, Inc.		116,000		1,118,240
Bridge Bancorp, Inc.		11,800		238,242
Bridge Capital Holdings *		12,200		177,876
Brookline Bancorp, Inc.		105,522		886,385
Bryn Mawr Bank Corp.		16,400		380,972
BSB Bancorp, Inc. *		11,300		155,375
C&F Financial Corp.		4,400		176,880
Camden National Corp.		10,300		343,917
Cape Bancorp, Inc.		15,400		138,754
Capital Bank Financial Corp., Class A *		13,400		239,458
Capital City Bank Group, Inc. *		15,300		191,250
Cardinal Financial Corp.		42,500		648,125
Cascade Bancorp (c)*		17,770		106,087
Cathay General Bancorp		112,422		2,215,838
Center Bancorp, Inc.		16,200		188,730
Centerstate Banks, Inc.		40,200		334,464
Central Pacific Financial Corp. *		29,700		500,148
Century Bancorp, Inc., Class A		4,700		159,706
Charter Financial Corp.		11,259		114,504
Chemical Financial Corp.		38,603		957,354
Citizens & Northern Corp.		16,300		315,568
City Holding Co.		22,100		843,778
Clifton Savings Bancorp, Inc.		11,400		136,914
CNB Financial Corp.		16,500		267,135
CoBiz Financial, Inc.		49,300		422,008
Columbia Banking System, Inc.		73,000		1,567,310
Community Bank System, Inc.		55,800		1,598,112
Community Trust Bancorp, Inc.		19,800		685,476
ConnectOne Bancorp, Inc. *		2,500		72,500
Crescent Financial Bancshares, Inc. *		13,000		53,690
CVB Financial Corp.		127,719		1,388,306
Dime Community Bancshares, Inc.		44,600		636,442
Doral Financial Corp. *		171,000		128,797
Eagle Bancorp, Inc. *		27,800		643,014
Enterprise Bancorp, Inc.		8,190		132,023
Enterprise Financial Services Corp.		24,300		349,434
ESB Financial Corp.		16,700		233,800

See financial notes 19

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
ESSA Bancorp, Inc.		15,200		163,704
EverBank Financial Corp.		30,700		491,200
F.N.B. Corp.		203,937		2,322,842
Farmers National Banc Corp.		25,800		170,280
Federal Agricultural Mortgage Corp., Class C		15,800		502,124
Fidelity Southern Corp. *		13,488		160,378
Financial Institutions, Inc.		18,500		353,905
First BanCorp *		96,500		570,315
First Bancorp		25,200		327,852
First Bancorp, Inc.		12,096		206,721
First Busey Corp.		103,200		443,760
First California Financial Group, Inc. *		30,800		248,556
First Commonwealth Financial Corp.		146,256		1,045,730
First Community Bancshares, Inc.		24,600		381,546
First Connecticut Bancorp, Inc.		23,900		354,676
First Defiance Financial Corp.		13,000		294,320
First Federal Bancshares of Arkansas, Inc. *		14,100		136,629
First Financial Bancorp		82,689		1,270,930
First Financial Bankshares, Inc. (c)		46,231		2,284,274
First Financial Corp.		17,700		546,753
First Financial Holdings, Inc.		22,100		442,884
First Financial Northwest, Inc. *		22,000		178,200
First Interstate BancSystem, Inc.		24,600		499,872
First Merchants Corp.		39,300		637,839
First Midwest Bancorp, Inc.		106,163		1,332,346
First PacTrust Bancorp, Inc.		13,600		154,496
Firstmerit Corp.		240,515		4,120,022
Flushing Financial Corp.		47,500		721,050
FNB United Corp. *		13,700		102,750
Fox Chase Bancorp, Inc.		19,500		329,745
Franklin Financial Corp.		21,500		390,870
German American Bancorp, Inc.		16,900		360,308
Glacier Bancorp, Inc.		106,011		1,955,903
Great Southern Bancorp, Inc.		13,600		358,632
Guaranty Bancorp *		104,600		221,752
Hancock Holding Co.		110,949		3,025,579
Hanmi Financial Corp. *		45,900		708,237
Heartland Financial USA, Inc.		19,900		505,659
Heritage Commerce Corp. *		27,900		183,303
Heritage Financial Corp.		21,000		292,950
Heritage Financial Group, Inc.		11,900		176,001
Heritage Oaks Bancorp *		27,600		152,352
Hingham Institution for Savings		1,800		122,418
Home Bancorp, Inc. *		9,400		170,140
Home Bancshares, Inc.		32,590		1,294,475
Home Federal Bancorp, Inc.		22,200		270,396
Home Loan Servicing Solutions Ltd.		75,000		1,698,750
HomeStreet, Inc.		12,000		258,000
HomeTrust Bancshares, Inc. *		29,400		468,930
Horizon Bancorp		9,900		191,070
Hudson Valley Holding Corp.		20,900		321,442
IBERIABANK Corp.		43,300		1,975,346
Independent Bank Corp.		33,000		1,024,320
International Bancshares Corp.		77,800		1,509,320
Investors Bancorp, Inc.		62,000		1,227,600
Kearny Financial Corp. *		22,000		216,700
Lakeland Bancorp, Inc.		41,250		394,350
Lakeland Financial Corp.		23,200		621,760
MainSource Financial Group, Inc.		27,000		342,090
MB Financial, Inc.		77,324		1,914,542
Mercantile Bank Corp.		11,800		197,178
Merchants Bancshares, Inc.		6,446		195,572
Meridian Interstate Bancorp, Inc. *		11,800		215,822
Metro Bancorp, Inc. *		18,600		330,150
MetroCorp Bancshares, Inc. *		21,700		218,085
MGIC Investment Corp. *		450,600		2,433,240
Middleburg Financial Corp.		7,400		133,866
MidSouth Bancorp, Inc.		10,200		160,242
MidWestOne Financial Group, Inc.		9,300		222,270
NASB Financial, Inc. (c)*		5,800		132,240
National Bank Holdings Corp., Class A		10,100		182,406
National Bankshares, Inc.		9,300		304,575
National Penn Bancshares, Inc.		182,178		1,783,523
Nationstar Mortgage Holdings, Inc. (c)*		28,700		1,055,299
NBT Bancorp, Inc.		62,523		1,266,091
Northfield Bancorp, Inc.		31,986		376,155
Northrim BanCorp, Inc.		8,900		193,842
Northwest Bancshares, Inc.		140,909		1,726,135
OceanFirst Financial Corp.		19,600		278,516
Ocwen Financial Corp. *		153,800		5,626,004
OFG Bancorp		63,500		1,020,445
Old National Bancorp		147,983		1,802,433
OmniAmerican Bancorp, Inc. *		15,900		395,910
Oritani Financial Corp.		67,950		1,051,186
Pacific Continental Corp.		24,700		276,146
Pacific Mercantile Bancorp *		14,600		87,600
PacWest Bancorp		42,216		1,170,650
Park National Corp. (c)		16,853		1,152,408
Park Sterling Corp. *		62,100		355,833
Peapack-Gladstone Financial Corp.		12,200		177,876
Penns Woods Bancorp, Inc.		5,100		208,692
Peoples Bancorp, Inc.		14,100		287,358
Peoples Federal Bancshares, Inc.		8,400		156,744
Pinnacle Financial Partners, Inc. *		51,932		1,260,390
Preferred Bank *		16,100		265,650
PrivateBancorp, Inc.		91,076		1,746,838
Prosperity Bancshares, Inc.		69,100		3,174,454
Provident Financial Holdings, Inc.		13,400		217,080
Provident Financial Services, Inc.		89,751		1,375,883
Provident New York Bancorp		60,100		543,304
Radian Group, Inc.		247,200		2,954,040
Renasant Corp.		36,300		828,366
Republic Bancorp, Inc., Class A		13,300		295,260
Rockville Financial, Inc.		39,500		513,500
Roma Financial Corp.		10,100		171,902
S&T Bancorp, Inc.		41,981		792,181
S.Y. Bancorp, Inc.		16,100		369,656
Sandy Spring Bancorp, Inc.		34,900		714,752
SCBT Financial Corp.		23,100		1,103,487
Seacoast Banking Corp. of Florida *		97,100		207,794
SI Financial Group, Inc.		14,500		168,200
Sierra Bancorp		15,900		205,428
Simmons First National Corp., Class A		23,200		568,864
Simplicity Bancorp, Inc.		12,400		186,000

20 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Southside Bancshares, Inc.		26,565		567,960
Southwest Bancorp, Inc. *		26,000		343,720
State Bank Financial Corp.		44,800		659,008
StellarOne Corp.		30,800		461,692
Sterling Bancorp		41,400		466,992
Sterling Financial Corp.		37,900		826,220
Suffolk Bancorp *		13,000		203,320
Sun Bancorp, Inc. *		50,400		162,288
Susquehanna Bancshares, Inc.		273,708		3,194,172
Taylor Capital Group, Inc. *		22,200		325,230
Territorial Bancorp, Inc.		16,000		374,080
Texas Capital Bancshares, Inc. *		56,800		2,366,288
The Bancorp, Inc. *		45,800		595,400
The First of Long Island Corp.		10,200		308,142
Tompkins Financial Corp.		15,400		643,720
TowneBank		35,879		513,428
Tree.com, Inc.		8,300		169,901
TriCo Bancshares		21,900		382,593
TrustCo Bank Corp.		131,702		705,923
Trustmark Corp.		95,877		2,353,780
UMB Financial Corp.		47,300		2,381,082
Umpqua Holdings Corp.		157,495		1,889,940
Union First Market Bankshares Corp.		27,100		512,461
United Bankshares, Inc. (c)		72,322		1,830,470
United Community Banks, Inc. *		64,700		708,465
United Financial Bancorp, Inc.		29,400		435,414
Univest Corp. of Pennsylvania		22,500		394,425
ViewPoint Financial Group, Inc.		46,700		869,554
Virginia Commerce Bancorp, Inc. *		36,800		494,592
Walker & Dunlop, Inc. *		19,500		347,295
Washington Banking Co.		20,500		282,900
Washington Trust Bancorp, Inc.		21,000		561,750
Waterstone Financial, Inc. *		20,600		164,594
Webster Financial Corp.		105,300		2,460,861
WesBanco, Inc.		35,498		888,515
West Bancorp, Inc.		20,800		224,224
Westamerica Bancorp		40,700		1,765,973
Western Alliance Bancorp *		108,500		1,596,035
Westfield Financial, Inc.		37,600		283,128
Wilshire Bancorp, Inc. *		90,100		575,739
Wintrust Financial Corp.		52,055		1,866,692
WSFS Financial Corp.		10,500		513,870
				155,520,620
Capital Goods 8.6%
A.O. Smith Corp.		56,395		4,253,875
AAON, Inc.		25,150		714,512
AAR Corp.		56,097		1,001,892
Accuride Corp. *		65,000		334,100
Aceto Corp.		35,700		371,280
Actuant Corp., Class A		106,148		3,322,432
Acuity Brands, Inc.		60,900		4,443,264
Aegion Corp. *		55,000		1,158,300
Aerovironment, Inc. *		24,300		470,448
Aircastle Ltd.		87,400		1,220,104
Alamo Group, Inc.		10,500		420,735
Albany International Corp., Class A		39,000		1,132,950
Altra Holdings, Inc.		38,200		1,018,030
Ameresco, Inc., Class A *		27,700		204,149
American Railcar Industries, Inc.		13,000		464,230
American Science & Engineering, Inc.		12,200		786,656
American Superconductor Corp. (c)*		59,800		150,098
American Woodmark Corp. *		15,700		528,305
Ampco-Pittsburgh Corp.		11,400		213,636
API Technologies Corp. *		44,400		122,544
Apogee Enterprises, Inc.		40,100		1,021,748
Applied Industrial Technologies, Inc.		60,366		2,550,464
Argan, Inc.		13,500		238,950
Astec Industries, Inc.		28,095		922,359
Astronics Corp. *		19,300		536,540
AZZ, Inc.		36,100		1,526,669
Barnes Group, Inc.		77,640		2,156,063
Beacon Roofing Supply, Inc. *		66,882		2,550,211
Belden, Inc.		65,400		3,232,068
Blount International, Inc. *		68,262		948,159
BlueLinx Holdings, Inc. *		44,964		130,845
Brady Corp., Class A		69,829		2,365,807
Briggs & Stratton Corp.		69,593		1,565,147
Builders FirstSource, Inc. *		60,900		376,971
CAI International, Inc. *		20,200		514,898
Capstone Turbine Corp. *		409,800		360,665
Chart Industries, Inc. *		43,000		3,646,830
CIRCOR International, Inc.		24,300		1,150,119
CLARCOR, Inc.		72,900		3,768,930
Coleman Cable, Inc.		11,200		168,000
Columbus McKinnon Corp. *		30,600		574,668
Comfort Systems USA, Inc.		50,800		651,764
Commercial Vehicle Group, Inc. *		33,500		234,835
CPI Aerostructures, Inc. *		7,700		70,917
Cubic Corp.		22,615		971,767
Curtiss-Wright Corp.		68,600		2,252,824
DigitalGlobe, Inc. *		78,135		2,280,761
Douglas Dynamics, Inc.		30,400		425,296
DXP Enterprises, Inc. *		12,500		836,000
Dycom Industries, Inc. *		47,200		911,904
Dynamic Materials Corp.		17,900		284,252
Edgen Group, Inc. *		20,600		141,110
EMCOR Group, Inc.		96,800		3,620,320
Encore Wire Corp.		23,041		754,593
Energy Recovery, Inc. *		61,300		224,358
EnerSys, Inc. *		69,178		3,171,120
Enphase Energy, Inc. (c)*		37,800		266,112
EnPro Industries, Inc. *		28,800		1,419,264
ESCO Technologies, Inc.		37,769		1,358,551
Esterline Technologies Corp. *		44,000		3,301,760
Federal Signal Corp. *		94,400		732,544
Flow International Corp. *		63,400		232,044
Franklin Electric Co., Inc.		66,236		2,144,059
FreightCar America, Inc.		16,000		334,080
FuelCell Energy, Inc. *		215,500		226,275
Furmanite Corp. *		49,500		314,325
GenCorp, Inc. *		83,200		1,087,424
Generac Holdings, Inc.		35,300		1,268,329
Gibraltar Industries, Inc. *		46,000		860,200
Global Power Equipment Group, Inc.		23,600		389,400
Graham Corp.		13,200		320,760
Granite Construction, Inc.		54,500		1,508,015
Great Lakes Dredge & Dock Corp.		85,200		589,584

See financial notes 21

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Griffon Corp.		63,821		657,356
H&E Equipment Services, Inc.		40,500		824,580
Hardinge, Inc.		16,000		216,000
HEICO Corp.		76,645		3,373,146
Hexcel Corp. *		144,183		4,397,581
Houston Wire & Cable Co.		23,800		324,156
Hurco Cos., Inc. *		8,600		230,738
Hyster-Yale Materials Handling, Inc.		15,554		811,763
II-VI, Inc. *		76,900		1,189,643
Insteel Industries, Inc.		23,600		391,288
John Bean Technologies Corp.		40,900		848,266
Kadant, Inc.		16,500		456,555
Kaman Corp.		37,349		1,262,023
Kaydon Corp.		47,235		1,126,082
Kratos Defense & Security Solutions, Inc. *		54,700		278,423
L.B. Foster Co., Class A		12,700		560,705
Layne Christensen Co. *		28,311		578,394
Lindsay Corp.		18,000		1,382,760
LMI Aerospace, Inc. *		12,300		263,097
LSI Industries, Inc.		26,100		183,744
Lydall, Inc. *		23,000		329,820
MasTec, Inc. *		78,373		2,178,769
Meritor, Inc. *		131,700		763,860
Met-Pro Corp. (c)		19,600		262,640
Michael Baker Corp.		11,200		272,720
Middleby Corp. *		26,752		4,001,564
Miller Industries, Inc.		15,800		238,738
Moog, Inc., Class A *		65,300		3,017,513
Mueller Industries, Inc.		29,224		1,513,219
Mueller Water Products, Inc., Class A		218,000		1,290,560
MYR Group, Inc. *		29,000		661,200
National Presto Industries, Inc. (c)		7,100		532,500
NCI Building Systems, Inc. *		26,400		451,968
NN, Inc. *		22,500		202,725
Nortek, Inc. *		10,600		761,716
Northwest Pipe Co. *		12,500		341,125
Omega Flex, Inc.		10,802		145,503
Orbital Sciences Corp. *		86,636		1,561,181
Orion Marine Group, Inc. *		36,200		331,592
Patrick Industries, Inc. *		5,800		117,508
PGT, Inc. *		26,800		206,360
Pike Electric Corp.		28,400		443,892
PMFG, Inc. *		27,700		159,552
Powell Industries, Inc. *		13,000		640,120
Preformed Line Products Co.		3,300		265,650
Primoris Services Corp.		41,100		905,844
Proto Labs, Inc. *		6,600		337,128
Quanex Building Products Corp.		55,404		901,423
Raven Industries, Inc.		53,000		1,778,150
RBC Bearings, Inc. *		31,400		1,510,340
Rexnord Corp. *		39,500		719,690
Rush Enterprises, Inc., Class A *		48,087		1,100,711
SIFCO Industries, Inc.		5,931		101,301
Simpson Manufacturing Co., Inc.		57,194		1,643,756
Solarcity Corp. (c)*		18,900		510,678
Standex International Corp.		17,600		931,040
Sterling Construction Co., Inc. *		22,000		222,640
Sun Hydraulics Corp.		30,150		987,413
Sypris Solutions, Inc.		14,500		46,400
TAL International Group, Inc.		41,300		1,709,820
Taser International, Inc. *		76,200		671,322
Teledyne Technologies, Inc. *		53,300		4,000,698
Tennant Co.		26,700		1,276,794
Textainer Group Holdings Ltd.		19,200		742,464
The Eastern Co.		8,500		142,205
The ExOne Co. (c)*		8,200		314,880
The Gorman-Rupp Co.		23,225		656,106
The Greenbrier Cos., Inc. *		31,400		708,384
The KEYW Holding Corp. *		34,500		468,855
Thermon Group Holdings, Inc. *		20,200		395,920
Titan International, Inc.		76,500		1,706,715
Titan Machinery, Inc. *		23,200		523,392
Trex Co., Inc. *		20,800		1,012,544
TriMas Corp. *		47,200		1,439,600
Tutor Perini Corp. *		49,030		806,053
Twin Disc, Inc.		11,300		240,916
Universal Forest Products, Inc.		28,162		1,087,053
USG Corp. *		104,800		2,723,752
Vicor Corp. *		26,200		140,694
Wabash National Corp. *		98,800		931,684
Watsco, Inc.		42,800		3,611,464
Watts Water Technologies, Inc., Class A		41,207		1,939,201
Willis Lease Finance Corp. *		7,500		106,425
Woodward, Inc.		100,200		3,606,198
				168,530,146
Commercial & Professional Supplies 3.2%
A.T. Cross Co., Class A *		12,800		161,536
ABM Industries, Inc.		76,009		1,714,003	��
Acacia Research Corp. *		72,500		1,726,950
Acco Brands Corp. *		161,700		1,091,475
Acorn Energy, Inc. (c)		24,600		184,500
ARC Document Solutions, Inc. *		49,600		159,216
Barrett Business Services, Inc.		10,200		539,988
Casella Waste Systems, Inc., Class A *		52,000		226,720
CBIZ, Inc. *		52,800		342,672
CDI Corp.		19,400		303,998
CECO Environmental Corp.		9,800		113,778
Cenveo, Inc. (c)*		73,800		150,552
Compx International, Inc.		6,699		83,737
Consolidated Graphics, Inc. *		11,400		406,638
Courier Corp.		13,800		198,720
CRA International, Inc. *		14,500		267,380
Deluxe Corp.		72,146		2,751,648
EnergySolutions, Inc. *		106,900		441,497
EnerNOC, Inc. *		35,000		613,200
Ennis, Inc.		38,200		587,134
Exponent, Inc.		18,700		985,490
Franklin Covey Co. *		17,900		252,032
FTI Consulting, Inc. *		61,600		2,040,192
G&K Services, Inc., Class A		26,330		1,237,247
GP Strategies Corp. *		19,900		438,795
Healthcare Services Group, Inc.		96,025		2,140,397
Heidrick & Struggles International, Inc.		24,100		318,602
Heritage-Crystal Clean, Inc. *		10,600		164,830
Herman Miller, Inc.		82,500		2,069,925
Hill International, Inc. *		33,600		92,400

22 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
HNI Corp.		65,300		2,248,279
Hudson Global, Inc. *		43,900		144,870
Huron Consulting Group, Inc. *		32,800		1,370,384
ICF International, Inc. *		28,200		764,502
InnerWorkings, Inc. *		43,600		439,052
Insperity, Inc.		33,210		917,592
Interface, Inc.		85,700		1,434,618
Intersections, Inc.		12,300		117,588
Kelly Services, Inc., Class A		38,323		652,257
Kforce, Inc.		45,200		683,424
Kimball International, Inc., Class B		45,500		418,145
Knoll, Inc.		66,903		1,041,011
Korn/Ferry International *		70,661		1,169,440
McGrath RentCorp		36,698		1,139,840
Metalico, Inc. *		53,700		80,013
Mine Safety Appliances Co.		39,089		1,876,272
Mistras Group, Inc. *		21,400		405,530
Mobile Mini, Inc. *		54,668		1,537,811
Multi-Color Corp.		18,500		478,410
Navigant Consulting, Inc. *		72,548		894,517
NL Industries, Inc.		8,900		100,303
Odyssey Marine Exploration, Inc. (c)*		114,000		336,300
On Assignment, Inc. *		63,200		1,533,864
Pendrell Corp. *		202,500		342,225
Performant Financial Corp. *		12,500		121,625
Quad Graphics, Inc. (c)		37,000		773,300
Resources Connection, Inc.		65,350		742,376
RPX Corp. *		29,000		388,890
Schawk, Inc.		17,700		180,186
Standard Parking Corp. *		21,200		455,588
Steelcase, Inc., Class A		106,542		1,353,083
Swisher Hygiene, Inc. (c)*		154,600		225,716
Team, Inc. *		29,300		1,135,668
Tetra Tech, Inc. *		90,800		2,387,132
The Advisory Board Co. *		48,952		2,405,991
The Brink’s Co.		66,900		1,773,519
The Corporate Executive Board Co.		47,400		2,671,464
The Dolan Co. *		40,700		70,411
TMS International Corp., Class A *		17,200		248,368
TRC Cos., Inc. *		23,700		143,148
TrueBlue, Inc. *		57,576		1,192,975
UniFirst Corp.		21,135		1,924,342
United Stationers, Inc.		58,234		1,890,858
US Ecology, Inc.		28,200		767,040
Viad Corp.		30,396		791,816
VSE Corp.		5,500		167,695
WageWorks, Inc. *		12,500		320,125
				64,062,815
Consumer Durables & Apparel 3.0%
American Greetings Corp., Class A		48,211		889,011
Arctic Cat, Inc. *		17,200		773,828
Bassett Furniture Industries, Inc.		15,500		217,465
Beazer Homes USA, Inc. (c)*		34,140		551,702
Black Diamond, Inc. *		28,600		280,280
Blyth, Inc. (c)		14,000		230,720
Brunswick Corp.		127,800		4,046,148
Callaway Golf Co.		94,069		630,262
Cavco Industries, Inc. *		10,200		465,324
Cherokee, Inc.		11,400		148,542
Columbia Sportswear Co. (c)		18,300		1,072,380
Crocs, Inc. *		127,100		2,036,142
CSS Industries, Inc.		13,400		384,044
Culp, Inc.		12,000		194,880
Delta Apparel, Inc. *		9,500		127,110
Ethan Allen Interiors, Inc.		34,179		1,000,761
Fifth & Pacific Cos., Inc. *		171,400		3,534,268
Flexsteel Industries, Inc.		6,200		127,658
G-III Apparel Group Ltd. *		23,500		955,510
Helen of Troy Ltd. *		44,900		1,566,112
Hooker Furniture Corp.		14,800		255,892
Hovnanian Enterprises, Inc., Class A (c)*		146,800		800,060
Iconix Brand Group, Inc. *		92,700		2,655,855
iRobot Corp. *		42,000		1,221,780
JAKKS Pacific, Inc.		36,400		397,124
Johnson Outdoors, Inc., Class A *		8,500		199,410
K-Swiss, Inc., Class A *		35,100		166,374
KB Home		116,800		2,632,672
La-Z-Boy, Inc.		72,500		1,309,350
LeapFrog Enterprises, Inc. *		69,300		619,542
Libbey, Inc. *		29,300		567,541
Lifetime Brands, Inc.		12,400		167,400
M.D.C. Holdings, Inc.		54,100		2,034,160
M/I Homes, Inc. *		34,500		848,700
Maidenform Brands, Inc. *		33,200		597,600
Marine Products Corp.		13,700		99,051
Meritage Homes Corp. *		44,685		2,180,181
Movado Group, Inc.		24,700		746,928
NACCO Industries, Inc., Class A		7,777		451,222
Oxford Industries, Inc.		21,100		1,247,643
Perry Ellis International, Inc.		16,800		295,176
Quiksilver, Inc. *		189,900		1,278,027
R. G. Barry Corp.		11,500		158,585
Skechers U.S.A., Inc., Class A *		53,778		1,117,507
Skullcandy, Inc. (c)*		22,200		114,108
Smith & Wesson Holding Corp. (c)*		98,900		868,342
Standard Pacific Corp. *		171,600		1,552,980
Steinway Musical Instruments, Inc. *		10,700		266,858
Steven Madden Ltd. *		56,200		2,733,006
Sturm, Ruger & Co., Inc. (c)		27,100		1,389,417
The Jones Group, Inc.		120,300		1,684,200
The Ryland Group, Inc.		63,500		2,861,310
TRI Pointe Homes, Inc. (c)*		22,600		429,400
True Religion Apparel, Inc.		36,300		982,278
Tumi Holdings, Inc. *		29,600		681,688
Unifi, Inc. *		18,700		364,650
Universal Electronics, Inc. *		20,100		461,898
Vera Bradley, Inc. (c)*		30,900		705,138
Wolverine World Wide, Inc.		71,036		3,393,390
Zagg, Inc. (c)*		35,000		236,950
				60,005,540
Consumer Services 4.3%
AFC Enterprises, Inc. *		35,800		1,141,304
American Public Education, Inc. *		25,200		844,956
Ameristar Casinos, Inc.		47,375		1,250,226

See financial notes 23

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Ascent Capital Group, Inc., Class A *		20,200		1,343,098
Biglari Holdings, Inc. *		1,800		697,104
BJ’s Restaurants, Inc. *		36,300		1,245,090
Bloomin’ Brands, Inc. *		25,600		556,800
Bob Evans Farms, Inc.		41,646		1,804,938
Boyd Gaming Corp. (c)*		81,300		975,600
Bravo Brio Restaurant Group, Inc. *		28,900		491,300
Bridgepoint Education, Inc. *		23,900		257,642
Bright Horizons Family Solutions, Inc. *		16,900		548,236
Buffalo Wild Wings, Inc. *		26,600		2,394,000
Caesars Entertainment Corp. (c)*		56,900		905,279
Capella Education Co. *		19,400		687,148
Career Education Corp. *		71,100		155,709
Carriage Services, Inc.		21,800		381,282
Carrols Restaurant Group, Inc. *		26,300		124,925
CEC Entertainment, Inc.		24,938		832,181
Churchill Downs, Inc.		19,161		1,465,050
Chuy’s Holdings, Inc. *		9,300		304,110
Coinstar, Inc. (c)*		39,900		2,107,119
Collectors Universe (c)		7,300		86,943
Corinthian Colleges, Inc. *		104,400		208,800
Cracker Barrel Old Country Store, Inc.		27,253		2,254,913
Del Frisco’s Restaurant Group, Inc. *		8,100		136,971
Denny’s Corp. *		132,500		751,275
DineEquity, Inc.		21,500		1,531,660
Domino’s Pizza, Inc.		83,979		4,635,641
Education Management Corp. (c)*		36,600		207,522
Einstein Noah Restaurant Group, Inc.		8,000		115,280
Fiesta Restaurant Group, Inc. *		22,200		605,172
Frisch’s Restaurants, Inc.		4,300		70,176
Grand Canyon Education, Inc. *		58,400		1,493,288
Hillenbrand, Inc.		78,000		1,960,140
Ignite Restaurant Group, Inc. *		9,100		158,704
International Speedway Corp., Class A		39,400		1,295,078
Interval Leisure Group, Inc.		53,900		1,027,334
Isle of Capri Casinos, Inc. *		27,300		209,118
Jack in the Box, Inc. *		62,588		2,243,780
Jamba, Inc. *		107,800		286,748
K12, Inc. (c)*		36,600		932,202
Krispy Kreme Doughnuts, Inc. *		84,200		1,150,172
LIFE TIME FITNESS, Inc. *		60,677		2,802,064
LifeLock, Inc. (c)*		25,200		226,800
Lincoln Educational Services Corp.		30,200		168,214
Luby’s, Inc. *		25,200		171,612
Mac-Gray Corp.		15,900		205,905
Marcus Corp.		27,300		350,532
Marriott Vacations Worldwide Corp. *		37,600		1,710,048
Matthews International Corp., Class A		39,484		1,453,406
Monarch Casino & Resort, Inc. *		11,900		153,153
Morgans Hotel Group Co. *		29,500		180,835
MTR Gaming Group, Inc. *		31,000		106,950
Multimedia Games Holding Co., Inc. *		38,500		949,410
Nathan’s Famous, Inc. *		3,700		165,205
National American University Holdings, Inc.		21,900		73,146
Orient-Express Hotels Ltd., Class A *		137,000		1,383,700
Papa John’s International, Inc. *		26,655		1,679,265
Pinnacle Entertainment, Inc. *		86,685		1,652,216
Premier Exhibitions, Inc. *		35,300		96,369
Red Lion Hotels Corp. *		19,700		128,641
Red Robin Gourmet Burgers, Inc. *		20,200		977,074
Regis Corp.		84,949		1,592,794
Ruby Tuesday, Inc. *		87,200		840,608
Ruth’s Hospitality Group, Inc. *		47,100		466,761
Scientific Games Corp., Class A *		77,900		691,752
SHFL Entertainment, Inc. *		81,300		1,284,540
Six Flags Entertainment Corp.		52,100		3,796,527
Sonic Corp. *		82,829		1,037,847
Sotheby’s		98,300		3,487,684
Speedway Motorsports, Inc.		15,784		284,586
Steiner Leisure Ltd. *		23,009		1,114,326
Stewart Enterprises, Inc., Class A		105,500		940,005
Strayer Education, Inc. (c)		16,400		776,704
Texas Roadhouse, Inc.		89,296		2,098,456
The Cheesecake Factory, Inc.		77,900		3,101,978
Town Sports International Holdings, Inc.		31,800		320,226
Universal Technical Institute, Inc.		28,600		339,482
Vail Resorts, Inc.		51,571		3,109,731
WMS Industries, Inc. *		80,500		2,043,090
				83,835,656
Diversified Financials 3.5%
Apollo Investment Corp.		290,300		2,557,543
Arlington Asset Investment Corp., Class A		20,500		555,345
Artio Global Investors, Inc.		41,900		114,806
Asset Acceptance Capital Corp. *		21,800		141,046
ASTA Funding, Inc.		15,200		142,728
BGC Partners, Inc., Class A		135,100		772,772
BlackRock Kelso Capital Corp.		108,800		1,082,560
Calamos Asset Management, Inc., Class A		25,400		288,290
California First National Bancorp		5,400		85,968
Capital Southwest Corp.		4,400		517,836
Cash America International, Inc.		41,570		1,813,699
CIFC Corp. *		8,700		68,121
Cohen & Steers, Inc. (c)		28,128		1,111,337
Cowen Group, Inc., Class A *		120,100		307,456
Credit Acceptance Corp. *		10,800		1,083,564
DFC Global Corp. *		64,600		872,100
Diamond Hill Investment Group		4,100		309,488
Encore Capital Group, Inc. *		30,100		857,549
Evercore Partners, Inc., Class A		41,600		1,570,400
Ezcorp, Inc., Class A *		70,100		1,184,690
FBR & Co. *		14,036		292,370
Fidus Investment Corp. (c)		19,600		368,480
Fifth Street Finance Corp.		171,600		1,894,464
Financial Engines, Inc.		69,800		2,538,626
First Cash Financial Services, Inc. *		40,500		2,084,535

24 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Firsthand Technology Value Fund, Inc. (c)*		11,700		217,620
FXCM, Inc., Class A		33,700		456,635
Gain Capital Holdings, Inc.		20,400		100,572
GAMCO Investors, Inc., Class A		9,700		509,250
GFI Group, Inc.		92,868		372,401
Gladstone Capital Corp.		28,200		261,414
Gladstone Investment Corp.		36,400		270,816
Golub Capital BDC, Inc. (c)		24,900		438,987
Green Dot Corp., Class A *		32,900		516,859
Greenhill & Co., Inc.		41,100		1,898,409
GSV Capital Corp. (c)*		26,500		203,785
Harris & Harris Group, Inc. *		41,500		136,950
Hercules Technology Growth Capital, Inc.		87,200		1,159,760
HFF, Inc., Class A		49,800		1,043,310
Horizon Technology Finance Corp.		11,100		163,059
ICG Group, Inc. *		54,400		645,728
INTL FCStone, Inc. *		20,400		349,248
Investment Technology Group, Inc. *		55,265		601,836
JMP Group, Inc.		20,300		131,138
KCAP Financial, Inc. (c)		36,300		392,766
Knight Capital Group, Inc., Class A *		252,500		893,850
Ladenburg Thalmann Financial Services, Inc. *		142,600		209,622
Main Street Capital Corp. (c)		45,500		1,367,730
Manning & Napier, Inc.		20,900		365,959
MarketAxess Holdings, Inc.		51,660		2,186,251
Marlin Business Services Corp.		11,600		281,068
MCG Capital Corp.		103,200		530,448
Medallion Financial Corp.		24,600		367,524
Medley Capital Corp.		47,600		741,608
MicroFinancial, Inc.		11,600		93,844
MVC Capital, Inc.		32,100		416,979
Nelnet, Inc., Class A		34,400		1,169,600
Netspend Holdings, Inc. *		42,600		679,896
New Mountain Finance Corp.		35,600		542,544
NewStar Financial, Inc. *		36,500		436,175
NGP Capital Resources Co.		29,000		193,140
Nicholas Financial, Inc.		13,000		190,060
OFS Capital Corp.		9,300		129,735
Oppenheimer Holdings, Inc., Class A		13,800		255,300
PennantPark Investment Corp.		91,000		1,064,700
PHH Corp. *		80,163		1,689,836
PICO Holdings, Inc. *		32,300		700,910
Piper Jaffray Cos., Inc. *		22,239		750,789
Portfolio Recovery Associates, Inc. *		24,443		3,000,378
Prospect Capital Corp.		286,700		3,162,301
Pzena Investment Management, Inc., Class A		13,700		86,858
Regional Management Corp. *		6,600		143,088
Resource America, Inc., Class A		16,500		152,130
Safeguard Scientifics, Inc. *		27,700		447,078
Solar Capital Ltd.		63,300		1,514,769
Solar Senior Capital Ltd.		16,300		312,471
Stellus Capital Investment Corp. (c)		11,200		171,360
Stifel Financial Corp. *		87,522		2,819,959
SWS Group, Inc. *		39,000		221,910
TCP Capital Corp.		7,900		123,793
The First Marblehead Corp. *		198,700		244,401
THL Credit, Inc.		20,900		321,442
TICC Capital Corp.		74,500		757,665
Triangle Capital Corp. (c)		38,000		1,062,860
Virtus Investment Partners, Inc. *		8,600		1,642,600
Walter Investment Management Corp. *		51,600		1,731,696
Westwood Holdings Group, Inc.		9,500		415,150
WhiteHorse Finance, Inc. (c)		9,500		150,575
WisdomTree Investments, Inc. *		86,200		999,920
World Acceptance Corp. *		13,900		1,235,154
				68,461,442
Energy 5.7%
Abraxas Petroleum Corp. (c)*		110,200		246,848
Adams Resources & Energy, Inc.		2,900		144,101
Alon USA Energy, Inc.		15,200		252,320
Amyris, Inc. (c)*		41,500		112,880
Apco Oil & Gas International, Inc. *		12,200		123,342
Approach Resources, Inc. *		46,200		1,095,864
Arch Coal, Inc. (c)		298,100		1,445,785
Basic Energy Services, Inc. *		42,300		580,779
Berry Petroleum Co., Class A		75,500		3,617,205
Bill Barrett Corp. (c)*		70,800		1,406,088
Bolt Technology Corp.		11,800		188,800
Bonanza Creek Energy, Inc. *		13,400		460,290
BPZ Resources, Inc. (c)*		145,300		310,942
Bristow Group, Inc.		50,587		3,197,098
C&J Energy Services, Inc. *		65,200		1,290,308
Cal Dive International, Inc. (c)*		127,800		213,426
Callon Petroleum Co. *		52,400		187,592
Carrizo Oil & Gas, Inc. *		58,400		1,414,448
Ceres, Inc. (c)*		17,700		41,595
Clayton Williams Energy, Inc. *		7,900		304,940
Clean Energy Fuels Corp. (c)*		97,500		1,286,025
Cloud Peak Energy, Inc. *		86,000		1,680,440
Comstock Resources, Inc. *		71,200		1,114,992
Contango Oil & Gas Co.		17,500		658,350
Crimson Exploration, Inc. *		29,200		89,644
Crosstex Energy, Inc.		57,500		1,058,575
CVR Energy, Inc.		24,300		1,197,261
Dawson Geophysical Co. *		10,600		325,844
Delek US Holdings, Inc.		25,800		931,122
Diamondback Energy, Inc. *		20,000		525,200
Dril-Quip, Inc. *		57,900		4,846,809
Emerald Oil, Inc. *		22,385		143,936
Endeavour International Corp. (c)*		64,600		177,004
Energy XXI (Bermuda) Ltd.		111,600		2,537,784
EPL Oil & Gas, Inc. *		38,800		1,267,596
Evolution Petroleum Corp. *		21,500		213,710
Exterran Holdings, Inc. *		92,900		2,454,418
Forbes Energy Services Ltd. *		51,400		193,778
Forest Oil Corp. *		177,000		741,630
Forum Energy Technologies, Inc. *		34,300		953,883
Frontline Ltd. (c)*		69,000		125,580
FX Energy, Inc. *		75,100		288,384
GasLog Ltd.		32,300		413,440
Gastar Exploration Ltd. *		77,800		217,840
Geospace Technologies Corp. *		18,400		1,552,408

See financial notes 25

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Gevo, Inc. (c)*		42,300		78,043
Global Geophysical Services, Inc. *		24,300		88,452
Goodrich Petroleum Corp. *		34,700		452,488
Green Plains Renewable Energy, Inc. *		34,200		427,842
Gulf Island Fabrication, Inc.		21,000		431,760
GulfMark Offshore, Inc., Class A		39,300		1,635,666
Gulfport Energy Corp. *		109,000		5,688,710
Halcon Resources Corp. (c)*		165,821		1,084,469
Hallador Energy Co.		8,900		63,724
Harvest Natural Resources, Inc. *		60,000		196,800
Heckmann Corp. (c)*		196,200		723,978
Helix Energy Solutions Group, Inc. *		153,400		3,534,336
Hercules Offshore, Inc. *		231,200		1,703,944
Hornbeck Offshore Services, Inc. *		51,845		2,328,877
ION Geophysical Corp. *		187,300		1,168,752
Isramco, Inc. *		1,400		127,890
Key Energy Services, Inc. *		213,700		1,269,378
KiOR, Inc., Class A (c)*		36,200		176,294
Knightsbridge Tankers Ltd. (c)		33,300		228,105
Kodiak Oil & Gas Corp. *		372,900		2,919,807
Lufkin Industries, Inc.		48,390		4,272,353
Magnum Hunter Resources Corp. (c)*		207,900		565,488
Matador Resources Co. *		18,500		182,595
Matrix Service Co. *		35,400		532,062
McMoRan Exploration Co. (c)*		143,600		2,376,580
Midstates Petroleum Co, Inc. *		33,000		190,410
Miller Energy Resources, Inc. (c)*		41,600		158,080
Mitcham Industries, Inc. *		18,500		274,725
Natural Gas Services Group, Inc. *		16,400		331,116
Newpark Resources, Inc. *		126,710		1,330,455
Nordic American Tankers Ltd. (c)		89,600		798,336
Northern Oil & Gas, Inc. *		89,900		1,158,811
Oasis Petroleum, Inc. *		114,300		3,912,489
Panhandle Oil & Gas, Inc., Class A		9,400		267,712
Parker Drilling Co. *		165,165		680,480
PDC Energy, Inc. *		42,803		1,853,370
Penn Virginia Corp.		76,778		309,415
PetroQuest Energy, Inc. *		84,900		363,372
PHI, Inc. - Non Voting Shares *		17,500		485,975
Pioneer Energy Services Corp. *		87,600		617,580
Quicksilver Resources, Inc. (c)*		161,200		406,224
Renewable Energy Group, Inc. *		24,000		235,920
Rentech, Inc.		316,700		655,569
Resolute Energy Corp. *		66,300		611,286
REX American Resources Corp. *		8,200		153,258
Rex Energy Corp. *		65,900		1,059,013
RigNet, Inc. *		16,900		408,980
Rosetta Resources, Inc. *		86,000		3,690,260
Sanchez Energy Corp. (c)*		15,900		287,949
Saratoga Resources, Inc. *		24,900		56,274
Scorpio Tankers, Inc. *		156,000		1,349,400
SemGroup Corp., Class A *		59,800		3,100,630
Ship Finance International Ltd.		67,800		1,117,344
Solazyme, Inc. (c)*		44,900		408,590
Stone Energy Corp. *		72,068		1,421,902
Swift Energy Co. *		60,701		785,471
Synergy Resources Corp. *		53,700		362,475
T.G.C. Industries, Inc.		21,000		186,270
Targa Resources Corp.		41,600		2,735,616
Teekay Tankers Ltd., Class A (c)		86,500		218,845
Tesco Corp. *		47,700		581,940
TETRA Technologies, Inc. *		108,974		994,933
Triangle Petroleum Corp. *		63,800		350,262
Uranerz Energy Corp. (c)*		86,500		88,230
Uranium Energy Corp. (c)*		136,000		210,800
VAALCO Energy, Inc. *		79,400		533,568
Vantage Drilling Co. *		262,900		444,301
W&T Offshore, Inc.		49,000		572,320
Warren Resources, Inc. *		95,700		251,691
Western Refining, Inc.		82,022		2,535,300
Westmoreland Coal Co. *		13,300		160,531
Willbros Group, Inc. *		53,400		507,300
ZaZa Energy Corp. (c)*		92,600		117,602
				113,221,077
Food & Staples Retailing 1.1%
Arden Group, Inc., Class A		1,800		178,020
Casey’s General Stores, Inc.		54,700		3,167,677
Harris Teeter Supermarkets, Inc.		62,800		2,624,412
Ingles Markets, Inc., Class A		16,831		358,837
Nash Finch Co.		16,200		332,910
Natural Grocers by Vitamin Cottage, Inc. *		9,900		248,292
PriceSmart, Inc.		25,700		2,293,211
Rite Aid Corp. *		935,700		2,479,605
Roundy’s, Inc. (c)		25,800		184,728
Spartan Stores, Inc.		30,300		508,434
SUPERVALU, Inc. (c)		303,700		1,773,608
Susser Holdings Corp. *		16,400		871,988
The Andersons, Inc.		27,200		1,482,944
The Chefs’ Warehouse, Inc. *		17,000		312,630
The Pantry, Inc. *		34,000		496,740
United Natural Foods, Inc. *		70,882		3,539,847
Village Super Market, Inc., Class A		11,600		408,320
Weis Markets, Inc.		15,800		660,914
				21,923,117
Food, Beverage & Tobacco 1.9%
Alico, Inc.		4,700		196,507
Alliance One International, Inc. *		116,600		437,250
Annie’s, Inc. *		6,900		260,751
B&G Foods, Inc.		74,800		2,308,328
Boulder Brands, Inc. *		83,800		755,038
Cal-Maine Foods, Inc.		20,100		857,868
Calavo Growers, Inc.		15,900		450,924
Chiquita Brands International, Inc. *		71,002		612,747
Coca-Cola Bottling Co. Consolidated		6,800		418,200
Craft Brew Alliance, Inc. *		13,900		104,528
Darling International, Inc. *		169,200		3,131,892
Diamond Foods, Inc. (c)*		31,900		481,052
Dole Food Co., Inc. *		56,300		605,788
Farmer Brothers Co. *		9,100		137,865
Fresh Del Monte Produce, Inc.		53,900		1,369,599
Griffin Land & Nurseries, Inc.		3,800		113,430
Inventure Foods, Inc. *		17,900		137,114
J&J Snack Foods Corp.		21,600		1,620,432
John B. Sanfilippo & Son, Inc.		10,900		228,682

26 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Lancaster Colony Corp.		26,700		2,107,431
Lifeway Foods, Inc.		10,100		128,068
Limoneira Co.		13,800		257,094
National Beverage Corp.		15,001		220,965
Omega Protein Corp. *		25,900		241,129
Pilgrim’s Pride Corp. *		92,249		903,118
Post Holdings, Inc. *		37,900		1,659,641
Sanderson Farms, Inc.		32,500		1,990,950
Seaboard Corp.		420		1,153,311
Seneca Foods Corp., Class A *		12,400		404,116
Snyders-Lance, Inc.		62,300		1,568,714
The Boston Beer Co., Inc., Class A *		11,000		1,862,520
The Hain Celestial Group, Inc. *		53,031		3,460,273
Tootsie Roll Industries, Inc.		36,336		1,134,773
TreeHouse Foods, Inc. *		51,400		3,274,694
Universal Corp.		32,945		1,895,985
Vector Group Ltd.		79,473		1,296,205
				37,786,982
Health Care Equipment & Services 6.1%
Abaxis, Inc.		32,200		1,374,618
ABIOMED, Inc. *		45,900		847,773
Acadia Healthcare Co., Inc. *		37,600		1,186,280
Accretive Health, Inc. *		77,300		814,742
Accuray, Inc. (c)*		97,300		428,120
Air Methods Corp.		55,100		2,016,109
Align Technology, Inc. *		104,700		3,467,664
Almost Family, Inc.		11,000		217,140
Alphatec Holdings, Inc. *		72,200		136,458
Amedisys, Inc. *		42,200		423,688
AMN Healthcare Services, Inc. *		61,900		849,887
AmSurg Corp. *		46,200		1,550,472
Analogic Corp.		17,954		1,426,984
AngioDynamics, Inc. *		33,500		339,355
Anika Therapeutics, Inc. *		16,200		216,270
Antares Pharma, Inc. (c)*		148,500		562,815
ArthroCare Corp. *		40,500		1,403,325
Assisted Living Concepts, Inc., Class A		26,200		312,304
athenahealth, Inc. *		51,700		4,976,642
AtriCure, Inc. *		25,500		212,670
Atrion Corp.		2,300		460,897
Bio-Reference Laboratories, Inc. (c)*		34,300		874,650
BioScrip, Inc. *		71,700		993,762
Cantel Medical Corp.		31,950		1,009,940
Capital Senior Living Corp. *		40,400		980,104
Cardiovascular Systems, Inc. *		27,700		475,332
Centene Corp. *		73,892		3,413,810
Cerus Corp. (c)*		92,600		492,632
Chemed Corp.		27,200		2,220,064
Chindex International, Inc. *		15,200		208,240
Computer Programs & Systems, Inc.		15,700		823,622
Conceptus, Inc. *		44,000		1,364,440
CONMED Corp.		39,400		1,234,402
CorVel Corp. *		8,300		394,001
Cross Country Healthcare, Inc. *		37,200		186,000
CryoLife, Inc.		37,400		224,400
Cyberonics, Inc. *		39,000		1,693,380
Cynosure, Inc., Class A *		17,200		444,792
Derma Sciences, Inc. (c)*		20,500		247,845
DexCom, Inc. *		100,300		1,645,923
Emeritus Corp. *		46,300		1,189,910
Endologix, Inc. *		79,200		1,189,584
EnteroMedics, Inc. *		144,100		138,336
Exactech, Inc. *		11,400		210,900
ExamWorks Group, Inc. *		40,100		725,810
Five Star Quality Care, Inc. *		56,200		265,826
Gentiva Health Services, Inc. *		40,996		430,048
Globus Medical, Inc., Class A (c)*		13,300		202,426
Greatbatch, Inc. *		32,900		919,226
Greenway Medical Technologies (c)*		10,300		138,741
Haemonetics Corp. *		71,700		2,760,450
Hanger, Inc. *		49,900		1,516,461
Hansen Medical, Inc. (c)*		95,500		187,180
HealthSouth Corp. *		139,000		3,822,500
HealthStream, Inc. *		26,800		615,328
Healthways, Inc. *		45,500		631,995
HeartWare International, Inc. *		23,400		2,274,480
HMS Holdings Corp. *		124,800		3,146,208
ICU Medical, Inc. *		18,800		1,132,700
Insulet Corp. *		73,900		1,865,236
Integra LifeSciences Holdings Corp. *		27,048		947,491
Invacare Corp.		43,711		587,913
IPC The Hospitalist Co., Inc. *		24,700		1,126,814
Kindred Healthcare, Inc. *		80,275		842,085
Landauer, Inc.		13,300		743,071
LHC Group, Inc. *		21,100		458,292
Magellan Health Services, Inc. *		39,500		2,020,820
MAKO Surgical Corp. (c)*		54,900		581,391
Masimo Corp.		69,900		1,402,194
MedAssets, Inc. *		85,200		1,595,796
Medidata Solutions, Inc. *		33,700		2,236,332
Merge Healthcare, Inc. *		80,500		251,160
Meridian Bioscience, Inc.		58,750		1,192,038
Merit Medical Systems, Inc. *		59,000		570,530
Molina Healthcare, Inc. *		44,200		1,467,440
MWI Veterinary Supply, Inc. *		18,200		2,142,322
National Healthcare Corp.		15,388		714,465
National Research Corp.		3,500		209,825
Natus Medical, Inc. *		42,800		535,428
Navidea Biopharmaceuticals, Inc. (c)*		152,800		374,360
Neogen Corp. *		34,150		1,735,844
NuVasive, Inc. *		64,300		1,348,371
NxStage Medical, Inc. *		72,200		806,474
Omnicell, Inc. *		47,300		852,346
OraSure Technologies, Inc. *		75,100		334,946
Orthofix International N.V. *		28,200		913,680
Owens & Minor, Inc.		91,700		2,986,669
Palomar Medical Technologies, Inc. *		25,500		345,525
PDI, Inc. *		13,800		63,066
PharMerica Corp. *		43,100		555,559
PhotoMedex, Inc. *		18,000		293,400
Quality Systems, Inc.		59,200		1,057,904
Quidel Corp. *		40,300		899,496
Rochester Medical Corp. *		14,600		198,268
Rockwell Medical, Inc. (c)*		28,600		121,264

See financial notes 27

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
RTI Biologics, Inc. *		73,900		294,122
Select Medical Holdings Corp.		48,000		396,000
Skilled Healthcare Group, Inc., Class A *		25,900		182,336
Solta Medical, Inc. *		95,100		185,445
Spectranetics Corp. *		48,000		895,200
STAAR Surgical Co. *		52,900		369,242
STERIS Corp.		84,200		3,501,878
SurModics, Inc. *		20,400		539,580
Symmetry Medical, Inc. *		53,900		642,488
Team Health Holdings, Inc. *		41,500		1,547,120
The Ensign Group, Inc.		23,900		833,393
The Providence Service Corp. *		17,400		304,674
Tornier N.V. *		25,800		469,302
Triple-S Management Corp., Class B *		26,500		477,795
U.S. Physical Therapy, Inc.		15,800		376,988
Unilife Corp. (c)*		115,000		227,700
Universal American Corp.		51,602		441,197
Utah Medical Products, Inc.		4,500		199,485
Vanguard Health Systems, Inc. *		45,100		659,813
Vascular Solutions, Inc. *		22,700		361,157
Vocera Communications, Inc. *		9,200		182,160
Volcano Corp. *		74,900		1,519,721
WellCare Health Plans, Inc. *		62,600		3,650,206
West Pharmaceutical Services, Inc.		48,465		3,094,975
Wright Medical Group, Inc. *		63,100		1,479,064
Zeltiq Aesthetics, Inc. (c)*		23,000		100,740
				120,959,257
Household & Personal Products 0.6%
Central Garden & Pet Co., Class A *		53,000		466,400
Elizabeth Arden, Inc. *		36,298		1,486,403
Harbinger Group, Inc. *		56,600		511,664
Inter Parfums, Inc.		25,400		735,838
Medifast, Inc. *		20,200		529,240
Nature’s Sunshine Products, Inc.		15,000		219,450
Nutraceutical International Corp.		12,300		227,181
Oil-Dri Corp. of America		6,887		189,461
Orchids Paper Products Co.		7,900		181,700
Prestige Brands Holdings, Inc. *		72,000		1,940,400
Revlon, Inc., Class A *		18,602		359,949
Spectrum Brands Holdings, Inc.		33,446		1,872,976
Star Scientific, Inc. (c)*		200,000		248,000
Synutra International, Inc. (c)*		23,200		112,056
The Female Health Co.		24,700		189,449
USANA Health Sciences, Inc. (c)*		9,100		513,422
WD-40 Co.		22,300		1,202,639
				10,986,228
Insurance 2.5%
Alterra Capital Holdings Ltd.		124,300		4,045,965
American Equity Investment Life Holding Co.		90,564		1,380,195
American Safety Insurance Holdings Ltd. *		14,000		337,120
AMERISAFE, Inc.		26,300		858,958
AmTrust Financial Services, Inc. (c)		39,525		1,251,362
Argo Group International Holdings Ltd.		36,538		1,514,500
Baldwin & Lyons, Inc., Class B		13,000		315,900
Citizens, Inc. *		54,800		358,392
CNO Financial Group, Inc.		288,700		3,268,084
Crawford & Co., Class B		34,500		261,855
Donegal Group, Inc., Class A		10,400		152,256
Eastern Insurance Holdings, Inc.		9,100		169,533
eHealth, Inc. *		28,600		598,884
EMC Insurance Group, Inc.		6,200		175,026
Employers Holdings, Inc.		44,900		1,016,985
Enstar Group Ltd. *		12,094		1,537,026
FBL Financial Group, Inc., Class A		13,868		545,151
First American Financial Corp.		154,000		4,122,580
Fortegra Financial Corp. *		8,200		66,010
Global Indemnity plc *		15,655		348,950
Greenlight Capital Re Ltd., Class A *		39,189		964,441
Hallmark Financial Services, Inc. *		21,200		191,860
Health Insurance Innovations, Inc. Class A *		6,300		94,500
Hilltop Holdings, Inc. *		60,339		807,939
Homeowners Choice, Inc.		13,800		366,252
Horace Mann Educators Corp.		55,678		1,255,539
Independence Holding Co.		11,248		118,104
Infinity Property & Casualty Corp.		16,592		941,430
Investors Title Co.		1,700		117,895
Kansas City Life Insurance Co.		5,700		205,770
Maiden Holdings Ltd.		76,900		794,377
Meadowbrook Insurance Group, Inc.		71,400		555,492
Montpelier Re Holdings Ltd.		70,900		1,826,384
National Financial Partners Corp. *		56,800		1,439,312
National Interstate Corp.		8,594		249,656
National Western Life Insurance Co., Class A		2,994		546,764
OneBeacon Insurance Group Ltd., Class A		33,400		453,906
Platinum Underwriters Holdings Ltd.		46,900		2,661,575
Primerica, Inc.		64,600		2,193,816
RLI Corp.		30,055		2,159,452
Safety Insurance Group, Inc.		17,770		882,636
Selective Insurance Group, Inc.		77,514		1,816,153
State Auto Financial Corp.		19,600		340,648
Stewart Information Services Corp.		27,700		749,839
Symetra Financial Corp.		112,800		1,537,464
The Navigators Group, Inc. *		13,685		792,088
The Phoenix Cos., Inc. *		7,790		226,767
Tower Group International Ltd.		55,930		1,058,196
United Fire Group, Inc.		28,800		805,248
Universal Insurance Holdings, Inc.		25,100		150,098
				48,628,333
Materials 4.9%
A. Schulman, Inc.		41,309		1,072,795
A.M. Castle & Co. (c)*		22,400		387,968
ADA-ES, Inc. *		12,400		342,364
AEP Industries, Inc. *		5,800		447,180
AK Steel Holding Corp. (c)		189,500		634,825
AMCOL International Corp.		37,752		1,161,629

28 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
American Vanguard Corp.		40,900		1,179,556
Arabian American Development Co. *		27,400		208,514
Axiall Corp.		99,400		5,213,530
Balchem Corp.		41,400		1,794,276
Berry Plastics Group, Inc. *		41,000		779,000
Boise Cascade Co. *		19,300		618,179
Boise, Inc.		148,700		1,188,113
Buckeye Technologies, Inc.		56,400		2,120,076
Calgon Carbon Corp. *		83,600		1,424,544
Century Aluminum Co. *		69,100		563,856
Chase Corp.		8,600		166,840
Chemtura Corp. *		141,200		3,001,912
Clearwater Paper Corp. *		33,200		1,527,864
Coeur d’Alene Mines Corp. *		145,450		2,216,658
Deltic Timber Corp.		15,204		949,946
Eagle Materials, Inc.		70,190		4,755,372
Ferro Corp. *		124,100		873,664
Flotek Industries, Inc. *		70,900		1,137,236
FutureFuel Corp.		25,000		306,250
General Moly, Inc. *		90,300		167,958
Globe Specialty Metals, Inc.		90,600		1,183,236
Gold Resource Corp. (c)		41,000		419,840
Golden Minerals Co. (c)*		59,200		107,744
Golden Star Resources Ltd. (c)*		394,800		426,384
Graphic Packaging Holding Co. *		222,015		1,669,553
GSE Holding, Inc. *		10,800		81,000
H.B. Fuller Co.		71,416		2,706,666
Handy & Harman Ltd. *		7,800		119,964
Hawkins, Inc.		12,400		461,156
Haynes International, Inc.		17,125		832,446
Headwaters, Inc. *		104,200		1,131,612
Hecla Mining Co. (c)		401,200		1,364,080
Horsehead Holding Corp. *		63,600		680,520
Innophos Holdings, Inc.		30,800		1,580,348
Innospec, Inc.		33,000		1,452,330
Kaiser Aluminum Corp.		27,250		1,716,750
KapStone Paper & Packaging Corp.		59,300		1,754,094
KMG Chemicals, Inc.		12,300		225,828
Koppers Holdings, Inc.		28,900		1,268,999
Kraton Performance Polymers, Inc. *		47,500		1,078,725
Landec Corp. *		35,300		473,373
Louisiana-Pacific Corp. *		199,000		3,605,880
LSB Industries, Inc. *		28,000		914,480
Materion Corp.		29,600		784,104
McEwen Mining, Inc. *		319,970		745,530
Midway Gold Corp. (c)*		186,800		175,667
Minerals Technologies, Inc.		50,222		2,040,520
Myers Industries, Inc.		46,000		681,720
Neenah Paper, Inc.		21,300		612,588
Noranda Aluminum Holding Corp.		45,700		174,117
Olin Corp.		114,600		2,769,882
Olympic Steel, Inc.		12,200		244,000
OM Group, Inc. *		48,200		1,179,454
Omnova Solutions, Inc. *		65,700		438,219
P.H. Glatfelter Co.		63,800		1,531,200
Paramount Gold & Silver Corp. (c)*		179,300		283,294
PolyOne Corp.		142,354		3,207,235
Quaker Chemical Corp.		18,100		1,117,132
Resolute Forest Products *		114,600		1,676,598
Revett Minerals, Inc. *		33,600		49,392
RTI International Metals, Inc. *		42,166		1,223,657
Schnitzer Steel Industries, Inc., Class A		37,800		927,234
Schweitzer-Mauduit International, Inc.		45,400		1,829,166
Sensient Technologies Corp.		72,025		2,834,184
Stepan Co.		25,500		1,451,970
Stillwater Mining Co. *		165,700		2,061,308
SunCoke Energy, Inc. *		100,200		1,516,026
Texas Industries, Inc. *		33,151		2,111,056
Tredegar Corp.		35,100		1,038,960
UFP Technologies, Inc. *		7,500		152,175
United States Lime & Minerals, Inc. *		2,700		124,686
Universal Stainless & Alloy Products, Inc. *		9,500		332,120
US Antimony Corp. (c)*		73,800		112,176
US Silica Holdings, Inc. (c)		15,800		322,794
Vista Gold Corp. *		79,400		133,392
Wausau Paper Corp.		60,100		611,818
Worthington Industries, Inc.		75,160		2,418,649
Zep, Inc.		32,600		495,520
Zoltek Cos., Inc. (c)*		37,200		491,412
				97,394,068
Media 1.4%
Arbitron, Inc.		37,456		1,748,821
Beasley Broadcasting Group, Inc., Class A		13,100		85,543
Belo Corp., Class A		135,100		1,448,272
Carmike Cinemas, Inc. *		24,300		426,708
Central European Media Enterprises Ltd., Class A (c)*		49,100		181,670
Crown Media Holdings, Inc., Class A (c)*		46,700		95,735
Cumulus Media, Inc., Class A *		108,200		345,158
Daily Journal Corp. *		1,300		137,202
Digital Generation, Inc. (c)*		36,700		245,890
Entercom Communications Corp., Class A *		32,400		256,284
Entravision Communications Corp., Class A		67,300		259,778
Fisher Communications, Inc.		11,800		488,756
Global Sources Ltd. *		25,900		176,638
Harte-Hanks, Inc.		61,316		486,236
Journal Communications, Inc., Class A *		57,900		394,299
LIN TV Corp., Class A *		48,000		590,880
Lions Gate Entertainment Corp. *		113,700		2,820,897
Live Nation Entertainment, Inc. *		203,300		2,567,679
Loral Space & Communications, Inc.		16,600		1,021,232
Martha Stewart Living Omnimedia, Inc., Class A *		36,500		90,155
MDC Partners, Inc., Class A		40,400		690,436
Meredith Corp. (c)		51,800		2,010,876
National CineMedia, Inc.		81,900		1,330,056
Nexstar Broadcasting Group, Inc., Class A		14,700		357,945
Outdoor Channel Holdings, Inc.		19,200		168,000

See financial notes 29

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
ReachLocal, Inc. *		13,400		223,378
Reading International, Inc., Class A *		23,000		133,860
Rentrak Corp. *		12,700		287,528
Saga Communications, Inc., Class A		6,400		294,656
Salem Communications Corp., Class A		14,100		129,438
Scholastic Corp.		38,469		1,055,974
Shutterstock, Inc. *		7,200		300,240
Sinclair Broadcast Group, Inc., Class A		71,000		1,902,800
The E.W. Scripps Co., Class A *		44,100		612,549
The McClatchy Co., Class A (c)*		77,300		178,563
The New York Times Co., Class A *		194,900		1,726,814
Valassis Communications, Inc.		55,500		1,422,465
Value Line, Inc.		13,200		123,552
World Wrestling Entertainment, Inc., Class A		36,500		335,070
				27,152,033
Pharmaceuticals, Biotechnology & Life Sciences 6.0%
Achillion Pharmaceuticals, Inc. *		104,000		784,160
Acorda Therapeutics, Inc. *		56,700		2,243,619
Acura Pharmaceuticals, Inc. (c)*		43,800		107,310
Aegerion Pharmaceuticals, Inc. *		39,900		1,677,396
Affymax, Inc. (c)*		50,100		45,095
Affymetrix, Inc. *		94,400		343,616
Agenus, Inc. *		31,300		152,118
Akorn, Inc. *		84,500		1,271,725
Alkermes plc *		177,542		5,434,561
Alnylam Pharmaceuticals, Inc. *		77,900		1,865,705
AMAG Pharmaceuticals, Inc. *		30,500		672,525
Amicus Therapeutics, Inc. *		41,400		134,550
Ampio Pharmaceuticals, Inc. (c)*		41,300		208,152
Anacor Pharmaceuticals, Inc. *		21,300		142,710
Arena Pharmaceuticals, Inc. (c)*		306,800		2,528,032
ArQule, Inc. *		83,300		245,735
Array BioPharma, Inc. *		161,900		963,305
Astex Pharmaceuticals *		127,800		879,264
Auxilium Pharmaceuticals, Inc. *		71,000		1,060,030
AVANIR Pharmaceuticals, Inc., Class A *		190,900		608,971
AVEO Pharmaceuticals, Inc. *		64,900		331,639
BG Medicine, Inc. (c)*		44,600		73,590
BioCryst Pharmaceuticals, Inc. (c)*		67,500		135,675
BioDelivery Sciences International, Inc. *		49,500		281,160
Biospecifics Technologies Corp. *		6,600		104,742
Biotime, Inc. (c)*		51,000		184,620
Cadence Pharmaceuticals, Inc. *		82,600		584,808
Cambrex Corp. *		43,300		540,817
Celldex Therapeutics, Inc. *		115,300		1,504,665
Cempra, Inc. *		11,200		77,168
Cepheid, Inc. *		95,300		3,633,789
ChemoCentryx, Inc. *		9,300		115,599
Clovis Oncology, Inc. (c)*		18,800		703,496
Codexis, Inc. *		32,900		73,696
Corcept Therapeutics, Inc. *		68,400		121,068
Cornerstone Therapeutics, Inc. *		18,100		151,678
Coronado Biosciences, Inc. *		25,700		289,125
Cubist Pharmaceuticals, Inc. *		91,832		4,216,925
Cumberland Pharmaceuticals, Inc. *		16,300		76,284
Curis, Inc. *		107,800		404,250
Cytori Therapeutics, Inc. (c)*		78,000		219,180
Dendreon Corp. (c)*		227,500		1,071,525
DepoMed, Inc. *		79,800		439,698
Discovery Laboratories, Inc. (c)*		59,500		100,555
Durata Therapeutics, Inc. *		13,000		94,640
Dyax Corp. *		132,200		363,550
Dynavax Technologies Corp. *		245,200		576,220
Emergent Biosolutions, Inc. *		35,500		544,570
Endocyte, Inc. *		40,600		563,934
Enzon Pharmaceuticals, Inc.		58,000		191,400
Exact Sciences Corp. *		88,400		825,656
Exelixis, Inc. (c)*		254,472		1,320,710
Fluidigm Corp. *		33,700		567,508
Furiex Pharmaceuticals, Inc. *		10,000		339,500
Genomic Health, Inc. *		22,800		692,208
Geron Corp. *		195,900		229,203
GTx, Inc. *		40,400		186,648
Halozyme Therapeutics, Inc. *		123,200		744,128
Harvard Bioscience, Inc. *		30,800		157,696
Hi-Tech Pharmacal Co., Inc.		15,100		499,206
Horizon Pharma, Inc. (c)*		49,200		118,080
Hyperion Therapeutics, Inc. *		9,900		212,355
Idenix Pharmaceuticals, Inc. *		125,100		462,870
ImmunoCellular Therapeutics Ltd. (c)*		99,000		249,480
ImmunoGen, Inc. *		118,100		1,891,962
Immunomedics, Inc. (c)*		88,100		225,536
Impax Laboratories, Inc. *		94,000		1,645,000
Infinity Pharmaceuticals, Inc. *		42,700		1,839,943
Intercept Pharmaceuticals, Inc. *		6,600		224,730
InterMune, Inc. *		115,200		1,074,816
Ironwood Pharmaceuticals, Inc. *		110,900		1,686,789
Isis Pharmaceuticals, Inc. *		141,800		3,174,902
Jazz Pharmaceuticals plc *		58,800		3,430,980
KaloBios Pharmaceuticals, Inc. *		12,400		74,400
Keryx Biopharmaceuticals, Inc. (c)*		116,500		949,475
KYTHERA Biopharmaceuticals, Inc. *		7,100		173,950
Lannett Co., Inc. *		21,700		251,937
Lexicon Pharmaceuticals, Inc. *		294,800		583,704
Ligand Pharmaceuticals, Inc., Class B *		23,700		647,484
LipoScience, Inc. *		8,600		74,304
Luminex Corp. *		62,700		1,042,701
MannKind Corp. (c)*		192,500		760,375
Maxygen, Inc.		40,500		97,200
Merrimack Pharmaceuticals, Inc. *		20,900		102,828
Momenta Pharmaceuticals, Inc. *		64,244		791,486
Nektar Therapeutics *		162,271		1,759,018
Neurocrine Biosciences, Inc. *		99,700		1,150,538
NewLink Genetics Corp. (c)*		22,400		312,256
Novavax, Inc. *		180,900		425,115
NPS Pharmaceuticals, Inc. *		120,400		1,616,972
Omeros Corp. (c)*		35,800		144,274
OncoGenex Pharmaceutical, Inc. *		19,500		197,535
Oncothyreon, Inc. (c)*		76,700		192,517
Opko Health, Inc. (c)*		152,900		1,018,314

30 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Optimer Pharmaceuticals, Inc. (c)*		67,200		1,037,568
Orexigen Therapeutics, Inc. *		117,800		716,224
Osiris Therapeutics, Inc. (c)*		22,300		250,206
Pacific Biosciences of California, Inc. *		45,400		116,224
Pacira Pharmaceuticals, Inc. *		25,300		730,411
Pain Therapeutics, Inc. *		49,400		203,528
PAREXEL International Corp. *		85,718		3,510,152
PDL Biopharma, Inc. (c)		197,500		1,528,650
Pernix Therapeutics Holdings *		9,800		37,436
Pharmacyclics, Inc. *		82,200		6,699,300
Pozen, Inc. *		35,400		174,522
Progenics Pharmaceuticals, Inc. *		65,300		300,380
Questcor Pharmaceuticals, Inc. (c)		78,000		2,397,720
Raptor Pharmaceutical Corp. (c)*		73,100		504,390
Regulus Therapeutics, Inc. *		18,100		127,062
Repligen Corp. *		42,300		379,008
Repros Therapeutics, Inc. (c)*		26,700		543,078
Rigel Pharmaceuticals, Inc. *		118,400		567,136
Sagent Pharmaceuticals, Inc. *		12,900		213,366
Sangamo BioSciences, Inc. (c)*		75,200		765,536
Santarus, Inc. *		77,800		1,429,186
SciClone Pharmaceuticals, Inc. *		78,000		368,940
Seattle Genetics, Inc. *		137,798		5,091,636
Sequenom, Inc. (c)*		166,100		626,197
SIGA Technologies, Inc. (c)*		46,100		152,130
Spectrum Pharmaceuticals, Inc. (c)		89,800		665,418
Sucampo Pharmaceuticals, Inc., Class A *		17,000		161,670
Sunesis Pharmaceuticals, Inc. (c)*		38,100		214,503
Supernus Pharmaceuticals, Inc. (c)*		31,800		163,452
Synageva BioPharma Corp. *		15,900		821,871
Synergy Pharmaceuticals, Inc. (c)*		74,500		391,125
Synta Pharmaceuticals Corp. *		60,100		616,025	��
Targacept, Inc. *		37,100		171,031
TESARO, Inc. *		9,900		272,349
The Medicines Co. *		78,008		2,633,550
Theravance, Inc. *		86,738		2,927,407
Threshold Pharmaceuticals, Inc. *		61,700		297,394
Transcept Pharmaceuticals, Inc. *		17,300		68,508
Trius Therapeutics, Inc. *		43,500		303,195
Vanda Pharmaceuticals, Inc. *		37,600		182,736
Ventrus Biosciences, Inc. *		53,900		144,452
Verastem, Inc. *		11,700		114,894
Vical, Inc. *		113,400		418,446
ViroPharma, Inc. *		95,574		2,604,392
VIVUS, Inc. (c)*		147,300		1,957,617
Xenoport, Inc. *		59,600		370,116
XOMA Corp. *		113,500		397,250
ZIOPHARM Oncology, Inc. (c)*		89,200		149,856
Zogenix, Inc. *		75,600		130,788
				117,952,965
Real Estate 9.4%
Acadia Realty Trust		76,436		2,182,248
AG Mortgage Investment Trust, Inc.		38,100		985,647
Agree Realty Corp.		18,600		559,302
Alexander’s Inc		2,900		893,171
American Assets Trust, Inc.		48,400		1,633,984
American Capital Mortgage Investment Corp.		84,400		2,241,664
AmREIT, Inc., Class B		4,000		76,040
Anworth Mortgage Asset Corp.		206,600		1,303,646
Apollo Commercial Real Estate Finance, Inc.		44,800		794,752
Apollo Residential Mortgage, Inc.		44,300		986,118
Ares Commercial Real Estate Corp.		10,600		178,398
ARMOUR Residential REIT, Inc.		535,200		3,473,448
Ashford Hospitality Trust		74,800		963,424
Associated Estates Realty Corp.		73,200		1,308,084
AV Homes, Inc. *		15,600		201,396
Campus Crest Communities, Inc.		92,100		1,258,086
CapLease, Inc.		127,300		893,646
Capstead Mortgage Corp.		141,200		1,875,136
Cedar Realty Trust, Inc.		81,800		524,338
Chatham Lodging Trust		24,900		455,919
Chesapeake Lodging Trust		69,500		1,644,370
Colonial Properties Trust		126,600		2,938,386
Colony Financial, Inc.		91,400		2,038,220
Consolidated-Tomoka Land Co.		5,600		208,376
Coresite Realty Corp.		28,200		1,020,276
Cousins Properties, Inc.		149,673		1,634,429
CubeSmart		191,000		3,355,870
CyrusOne, Inc.		27,100		650,129
CYS Investments, Inc.		247,600		3,077,668
DCT Industrial Trust, Inc.		390,300		3,056,049
DiamondRock Hospitality Co.		271,417		2,708,742
DuPont Fabros Technology, Inc.		90,000		2,262,600
Dynex Capital, Inc.		76,500		822,375
EastGroup Properties, Inc.		42,790		2,698,765
Education Realty Trust, Inc.		161,700		1,777,083
EPR Properties		66,300		3,748,602
Equity One, Inc.		77,637		1,978,967
Excel Trust, Inc.		67,300		1,024,979
FelCor Lodging Trust, Inc. *		186,400		1,114,672
First Industrial Realty Trust, Inc.		153,700		2,757,378
First Potomac Realty Trust		73,300		1,172,800
Forestar Group, Inc. *		49,700		1,070,538
Franklin Street Properties Corp.		106,365		1,624,194
Getty Realty Corp.		39,242		840,171
Gladstone Commercial Corp. (c)		14,700		281,358
Glimcher Realty Trust		198,900		2,494,206
Government Properties Income Trust		61,500		1,602,075
Gramercy Property Trust, Inc. *		63,000		299,250
Gyrodyne Co of America, Inc.		1,600		118,096
Healthcare Realty Trust, Inc.		126,681		3,802,964
Hersha Hospitality Trust		253,100		1,513,538
Highwoods Properties, Inc.		113,600		4,661,008
Hudson Pacific Properties, Inc.		61,600		1,405,096
Inland Real Estate Corp.		109,036		1,234,287
Invesco Mortgage Capital, Inc.		193,200		4,134,480
Investors Real Estate Trust		140,300		1,365,119
iStar Financial, Inc. *		125,500		1,465,840
JAVELIN Mortgage Investment Corp.		10,100		203,414
Kennedy-Wilson Holdings, Inc.		70,600		1,174,078
Kite Realty Group Trust		112,800		744,480
LaSalle Hotel Properties		138,726		3,597,165
Lexington Realty Trust		218,484		2,798,780

See financial notes 31

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
LTC Properties, Inc.		42,967		1,997,965
Medical Properties Trust, Inc.		214,100		3,444,869
Monmouth Real Estate Investment Corp., Class A		54,900		584,136
National Health Investors, Inc.		35,068		2,322,904
New York Mortgage Trust, Inc. (c)		68,800		491,232
NorthStar Realty Finance Corp.		277,000		2,761,690
Omega Healthcare Investors, Inc.		160,300		5,269,061
One Liberty Properties, Inc.		14,900		341,806
Parkway Properties, Inc.		37,800		689,094
Pebblebrook Hotel Trust		87,000		2,362,920
Pennsylvania Real Estate Investment Trust		81,112		1,681,452
PennyMac Mortgage Investment Trust		85,200		2,151,300
Potlatch Corp.		57,603		2,727,502
PS Business Parks, Inc.		26,438		2,109,752
RAIT Financial Trust		100,200		855,708
Ramco-Gershenson Properties Trust		85,200		1,488,444
Redwood Trust, Inc.		113,500		2,590,070
Resource Capital Corp.		178,500		1,176,315
Retail Opportunity Investments Corp.		88,800		1,315,128
RLJ Lodging Trust		175,500		4,043,520
Rouse Properties, Inc. (c)		30,400		576,080
Ryman Hospitality Properties		48,850		2,171,871
Sabra Health Care REIT, Inc.		51,866		1,546,644
Saul Centers, Inc.		10,800		483,840
Select Income REIT		16,200		462,186
Silver Bay Realty Trust Corp. (c)		47,233		901,206
Sovran Self Storage, Inc.		43,626		2,992,744
Spirit Realty Capital, Inc.		46,500		1,001,145
STAG Industrial, Inc.		51,500		1,135,060
Starwood Property Trust, Inc.		238,200		6,548,118
Strategic Hotels & Resorts, Inc. *		258,900		2,089,323
Summit Hotel Properties, Inc.		79,300		792,207
Sun Communities, Inc.		51,300		2,623,995
Sunstone Hotel Investors, Inc. *		231,910		2,878,003
Tejon Ranch Co. *		19,092		557,105
Terreno Realty Corp.		27,400		515,668
The Geo Group, Inc.		103,180		3,864,091
Thomas Properties Group, Inc.		44,200		224,978
Two Harbors Investment Corp.		512,200		6,136,156
UMH Properties, Inc.		19,000		209,950
Universal Health Realty Income Trust		16,900		908,037
Urstadt Biddle Properties, Inc., Class A		34,600		770,542
Washington Real Estate Investment Trust		94,900		2,710,344
Western Asset Mortgage Capital Corp.		25,900		580,160
Whitestone REIT (c)		19,200		316,800
Winthrop Realty Trust		42,800		543,988
ZAIS Financial Corp. *		8,000		165,280
				185,019,709
Retailing 4.3%
1-800-FLOWERS.COM, Inc., Class A *		34,800		206,364
Aeropostale, Inc. *		115,000		1,685,900
America’s Car-Mart, Inc. *		11,500		532,105
ANN, Inc. *		69,000		2,038,260
Asbury Automotive Group, Inc. *		39,100		1,567,519
Barnes & Noble, Inc. (c)*		38,900		705,257
Bebe Stores, Inc.		51,449		291,201
Big 5 Sporting Goods Corp.		22,600		379,680
Blue Nile, Inc. *		19,000		619,970
Body Central Corp. *		22,200		225,996
Brown Shoe Co., Inc.		59,375		1,004,031
Cabela’s, Inc. *		67,836		4,355,071
CafePress, Inc. (c)*		21,100		121,747
Citi Trends, Inc. *		20,100		236,577
Conn’s, Inc. *		23,500		1,017,785
Core-Mark Holding Co., Inc.		16,200		843,048
Destination Maternity Corp.		18,400		437,000
Destination XL Group, Inc. *		56,400		280,872
Express, Inc. *		130,800		2,381,868
Five Below, Inc. *		15,400		554,246
Francesca’s Holdings Corp. (c)*		49,100		1,402,296
Fred’s, Inc., Class A		52,800		751,344
Geeknet, Inc. *		5,900		77,172
Genesco, Inc. *		35,944		2,212,353
Gordmans Stores, Inc. *		11,600		130,848
Group 1 Automotive, Inc.		32,400		1,959,552
Haverty Furniture Cos, Inc.		30,300		720,534
hhgregg, Inc. (c)*		27,700		374,227
Hibbett Sports, Inc. *		37,775		2,071,959
Hot Topic, Inc.		59,000		823,050
HSN, Inc.		51,300		2,697,354
Jos. A. Bank Clothiers, Inc. *		39,418		1,721,778
Kayak Software Corp. *		4,900		195,118
Kirkland’s, Inc. *		22,400		270,144
Lithia Motors, Inc., Class A		31,900		1,579,688
Lumber Liquidators Holdings, Inc. *		39,000		3,196,440
MarineMax, Inc. *		31,100		360,449
Mattress Firm Holding Corp. (c)*		15,100		578,632
Monro Muffler Brake, Inc.		43,750		1,809,500
New York & Co., Inc. *		36,400		162,344
Nutrisystem, Inc.		39,948		323,579
Office Depot, Inc. *		415,600		1,604,216
OfficeMax, Inc.		122,500		1,409,975
Orbitz Worldwide, Inc. *		28,000		167,440
Orchard Supply Hardware Stores Corp., Class A (c)*		16,800		33,264
Overstock.com, Inc. (c)*		15,500		322,400
Penske Automotive Group, Inc.		62,616		1,936,087
Perfumania Holdings, Inc. *		9,800		61,054
PetMed Express, Inc.		29,500		368,750
Pier 1 Imports, Inc.		137,400		3,189,054
Pool Corp.		67,177		3,293,017
RadioShack Corp. (c)		136,500		432,705
Rent-A-Center, Inc.		84,105		2,937,788
Restoration Hardware Holdings, Inc. (c)*		7,700		299,915
rue21, Inc. *		21,600		689,040
Saks, Inc. *		161,500		1,865,325
Select Comfort Corp. *		79,600		1,689,112
Shoe Carnival, Inc.		20,250		421,807
Shutterfly, Inc. *		54,300		2,417,979
Sonic Automotive, Inc., Class A		63,600		1,398,564

32 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Stage Stores, Inc.		46,827		1,296,640
Stein Mart, Inc.		36,800		291,088
Systemax, Inc.		14,500		132,820
The Bon-Ton Stores, Inc.		16,500		253,110
The Buckle, Inc. (c)		39,264		1,906,267
The Cato Corp., Class A		38,404		922,080
The Children’s Place Retail Stores, Inc. *		35,913		1,756,864
The Finish Line, Inc., Class A		71,619		1,388,692
The Men’s Wearhouse, Inc.		72,000		2,412,000
The Pep Boys - Manny, Moe & Jack *		74,800		867,680
The Wet Seal, Inc., Class A *		121,200		395,112
Tilly’s, Inc., Class A *		12,600		181,944
Tuesday Morning Corp. *		57,700		467,947
US Auto Parts Network, Inc. *		71,200		89,000
Vitacost.com, Inc. *		30,300		235,734
Vitamin Shoppe, Inc. *		43,100		2,118,365
VOXX International Corp. *		24,200		230,626
West Marine, Inc. *		19,800		234,234
Weyco Group, Inc.		9,100		218,400
Winmark Corp.		3,000		185,610
Zumiez, Inc. *		30,100		871,997
				83,896,560
Semiconductors & Semiconductor Equipment 3.4%
Advanced Energy Industries, Inc. *		57,600		978,048
Alpha & Omega Semiconductor Ltd. *		28,000		202,720
Ambarella, Inc. *		8,400		115,080
Amkor Technology, Inc. (c)*		109,518		463,261
ANADIGICS, Inc. *		117,100		245,910
Applied Micro Circuits Corp. *		91,065		679,345
ATMI, Inc. *		47,654		1,036,475
Axcelis Technologies, Inc. *		142,100		184,730
AXT, Inc. *		42,800		122,836
Brooks Automation, Inc.		93,731		911,065
Cabot Microelectronics Corp. *		32,800		1,099,128
Cavium, Inc. *		71,100		2,236,095
CEVA, Inc. *		33,700		514,262
Cirrus Logic, Inc. *		92,700		1,790,037
Cohu, Inc.		32,200		308,154
Cymer, Inc. *		44,365		4,647,678
Diodes, Inc. *		49,381		1,000,459
DSP Group, Inc. *		31,400		253,398
Entegris, Inc. *		197,500		1,872,300
Entropic Communications, Inc. *		119,200		505,408
Exar Corp. *		58,500		630,630
First Solar, Inc. *		86,300		4,018,128
FormFactor, Inc. *		68,473		338,941
GSI Technology, Inc. *		27,000		168,480
GT Advanced Technologies, Inc. (c)*		168,600		662,598
Hittite Microwave Corp. *		44,609		2,503,011
Inphi Corp. *		32,100		302,061
Integrated Device Technology, Inc. *		212,000		1,507,320
Integrated Silicon Solutions, Inc. *		35,900		329,203
Intermolecular, Inc. *		19,000		165,490
International Rectifier Corp. *		97,900		2,076,459
Intersil Corp., Class A		180,300		1,399,128
IXYS Corp.		32,400		293,544
Kopin Corp. *		100,300		331,993
Lattice Semiconductor Corp. *		170,200		791,430
LTX-Credence Corp. *		66,300		391,170
M/A-COM Technology Solutions Holdings, Inc. *		8,300		116,449
Mattson Technology, Inc. *		100,300		154,462
MaxLinear, Inc., Class A *		30,400		189,392
MEMC Electronic Materials, Inc. *		339,200		1,831,680
Micrel, Inc.		67,505		679,100
Microsemi Corp. *		127,119		2,644,075
Mindspeed Technologies, Inc. (c)*		64,400		147,476
MKS Instruments, Inc.		77,299		2,077,024
Monolithic Power Systems, Inc.		46,200		1,114,344
MoSys, Inc. *		43,700		197,524
Nanometrics, Inc. *		32,200		451,766
NeoPhotonics Corp. *		26,800		147,668
NVE Corp. *		6,400		339,648
OmniVision Technologies, Inc. *		77,873		1,044,277
PDF Solutions, Inc. *		35,700		610,827
Peregrine Semiconductor Corp. *		8,800		85,008
Pericom Semiconductor Corp. *		33,500		216,410
Photronics, Inc. *		85,200		672,228
PLX Technology, Inc. *		59,600		278,332
Power Integrations, Inc.		39,862		1,650,686
QuickLogic Corp. (c)*		53,100		135,936
Rambus, Inc. *		167,900		1,168,584
RF Micro Devices, Inc. *		393,600		2,208,096
Rubicon Technology, Inc. (c)*		23,500		174,135
Rudolph Technologies, Inc. *		46,700		544,989
Semtech Corp. *		93,729		3,005,889
Sigma Designs, Inc. *		43,000		204,680
Silicon Image, Inc. *		113,600		560,048
Spansion, Inc., Class A *		67,400		875,526
STR Holdings, Inc. *		40,500		91,125
SunPower Corp. (c)*		54,600		742,014
Supertex, Inc.		14,800		311,984
Tessera Technologies, Inc.		76,490		1,558,101
TriQuint Semiconductor, Inc. *		249,000		1,454,160
Ultra Clean Holdings, Inc. *		48,200		301,732
Ultratech, Inc. *		40,000		1,178,800
Veeco Instruments, Inc. *		57,200		2,177,604
Volterra Semiconductor Corp. *		34,800		452,748
				66,870,502
Software & Services 7.7%
Accelrys, Inc. *		80,500		792,925
ACI Worldwide, Inc. *		57,215		2,689,677
Actuate Corp. *		67,700		415,678
Acxiom Corp. *		109,876		2,185,434
Advent Software, Inc. *		43,928		1,275,669
American Software, Inc., Class A		30,400		252,624
Angie’s List, Inc. *		51,000		1,236,240
Aspen Technology, Inc. *		135,400		4,126,992
AVG Technologies NV *		10,800		176,256
Bankrate, Inc. *		63,400		854,632
Bazaarvoice, Inc. *		14,600		105,850
Blackbaud, Inc.		63,869		1,872,000
Blucora, Inc. *		55,500		819,735
Bottomline Technologies, Inc. *		53,200		1,393,840
Brightcove, Inc. *		22,100		133,042

See financial notes 33

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
BroadSoft, Inc. *		38,900		994,284
CACI International, Inc., Class A *		32,900		1,924,321
Callidus Software, Inc. *		55,900		239,811
Carbonite, Inc. *		15,500		164,920
Cardtronics, Inc. *		62,400		1,747,824
Cass Information Systems, Inc.		15,640		653,752
CIBER, Inc. *		100,000		426,000
CommVault Systems, Inc. *		64,200		4,721,268
Computer Task Group, Inc.		20,200		414,504
comScore, Inc. *		48,500		784,245
Comverse, Inc. *		30,070		797,757
Constant Contact, Inc. *		41,800		610,698
Convergys Corp.		157,400		2,678,948
Cornerstone OnDemand, Inc. *		49,100		1,781,348
CoStar Group, Inc. *		40,375		4,377,054
CSG Systems International, Inc. *		51,100		1,104,271
Dealertrack Technologies, Inc. *		60,036		1,672,003
Demand Media, Inc. *		41,100		355,926
Demandware, Inc. *		9,000		245,700
Dice Holdings, Inc. *		64,900		547,756
Digimarc Corp.		10,300		225,982
Digital River, Inc. *		52,800		764,544
E2open, Inc. *		8,500		120,785
EarthLink, Inc.		147,381		838,598
Ebix, Inc. (c)		38,600		718,346
Ellie Mae, Inc. *		34,500		897,690
Envestnet, Inc. *		29,000		528,380
Envivio, Inc. *		40,100		64,160
EPAM Systems, Inc. *		7,300		156,950
EPIQ Systems, Inc.		48,700		680,339
ePlus, Inc.		5,200		236,496
Euronet Worldwide, Inc. *		74,736		2,281,690
Exa Corp. *		8,000		59,680
ExactTarget, Inc. *		13,400		262,372
ExlService Holdings, Inc. *		35,100		1,144,962
Fair Isaac Corp.		49,100		2,287,078
FalconStor Software, Inc. *		41,100		67,815
FleetMatics Group plc *		12,500		293,375
Forrester Research, Inc.		19,717		706,854
Global Cash Access Holdings, Inc. *		91,800		654,534
Glu Mobile, Inc. (c)*		74,200		228,536
Guidance Software, Inc. *		18,600		195,672
Guidewire Software, Inc. *		28,500		1,142,280
Heartland Payment Systems, Inc.		54,900		1,805,661
Higher One Holdings, Inc. (c)*		43,800		431,868
iGATE Corp. *		44,140		736,697
Imperva, Inc. *		14,800		576,904
Infoblox, Inc. *		10,700		236,577
Innodata, Inc. *		30,500		100,040
Interactive Intelligence Group, Inc. *		20,500		849,315
Internap Network Services Corp. *		75,700		604,086
IntraLinks Holdings, Inc. *		50,600		289,432
Ipass, Inc. *		71,300		137,609
j2 Global, Inc.		60,228		2,451,280
Jive Software, Inc. *		23,300		316,647
Keynote Systems, Inc.		21,500		241,015
Limelight Networks, Inc. *		90,900		175,437
Lionbridge Technologies, Inc. *		82,500		282,150
Liquidity Services, Inc. (c)*		33,300		1,095,570
LivePerson, Inc. *		78,700		1,008,934
LogMeIn, Inc. *		30,300		684,174
Manhattan Associates, Inc. *		29,247		2,053,432
ManTech International Corp., Class A		34,500		920,805
Marchex, Inc., Class B		28,600		118,118
Market Leader, Inc. *		30,300		303,606
Mattersight Corp. (c)*		13,900		65,052
MAXIMUS, Inc.		49,348		3,932,542
MeetMe, Inc. (c)*		47,000		90,710
Mentor Graphics Corp.		131,767		2,406,065
MicroStrategy, Inc., Class A *		12,562		1,132,967
Millennial Media, Inc. *		15,700		108,801
ModusLink Global Solutions, Inc. *		58,700		164,360
MoneyGram International, Inc. *		29,500		487,045
Monotype Imaging Holdings, Inc.		52,300		1,212,837
Monster Worldwide, Inc. *		166,500		729,270
Move, Inc. *		53,100		605,871
NetScout Systems, Inc. *		52,000		1,186,120
NIC, Inc.		92,200		1,552,648
OpenTable, Inc. *		33,100		1,833,409
Pegasystems, Inc.		23,600		597,316
Perficient, Inc. *		43,800		459,024
PRGX Global, Inc. *		32,500		181,675
Progress Software Corp. *		82,820		1,869,247
Proofpoint, Inc. *		8,700		159,384
PROS Holdings, Inc. *		31,300		811,296
PTC, Inc. *		173,200		4,158,532
QAD, Inc., Class A		8,800		106,304
QLIK Technologies, Inc. *		122,900		3,196,629
Qualys, Inc. *		12,100		133,100
QuinStreet, Inc. *		44,900		293,646
RealNetworks, Inc. *		28,257		217,579
RealPage, Inc. *		53,100		1,083,240
Responsys, Inc. *		49,100		381,507
Rosetta Stone, Inc. *		14,700		248,871
Sapiens International Corp. N.V. (c)		19,400		112,326
Sapient Corp. *		176,963		2,066,928
SciQuest, Inc. *		24,500		560,070
SeaChange International, Inc. *		40,700		442,002
ServiceSource International, Inc. *		68,100		435,840
Sourcefire, Inc. *		42,400		2,025,024
Spark Networks, Inc. (c)*		15,700		107,074
SPS Commerce, Inc. *		17,200		810,636
SS&C Technologies Holdings, Inc. *		50,200		1,540,638
Stamps.com, Inc. *		19,400		656,496
Support.com, Inc. *		64,900		258,951
Sykes Enterprises, Inc. *		54,193		834,030
Synacor, Inc. (c)*		23,800		69,258
Synchronoss Technologies, Inc. *		39,500		1,119,430
Syntel, Inc.		22,900		1,446,593
Take-Two Interactive Software, Inc. *		115,004		1,754,961
Tangoe, Inc. *		40,900		525,974
TechTarget, Inc. *		19,600		87,024
TeleNav, Inc. *		22,100		115,804
TeleTech Holdings, Inc. *		34,000		723,860
The Active Network, Inc. *		53,300		268,099
The Hackett Group, Inc.		40,800		199,104
TiVo, Inc. *		177,803		2,083,851
Travelzoo, Inc. *		9,800		250,194
Trulia, Inc. *		11,300		328,378

34 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Tyler Technologies, Inc. *		43,000		2,719,320
Ultimate Software Group, Inc. *		41,000		3,960,190
Unisys Corp. *		65,050		1,244,407
United Online, Inc.		126,687		861,472
Unwired Planet, Inc. *		114,100		225,918
ValueClick, Inc. *		107,400		3,314,364
VASCO Data Security International, Inc. *		40,200		342,102
Verint Systems, Inc. *		59,805		1,975,957
Virnetx Holding Corp. (c)*		60,000		1,225,200
Virtusa Corp. *		25,600		568,576
VistaPrint N.V. (c)*		50,200		2,048,160
Vocus, Inc. *		28,300		238,003
Web.com Group, Inc. *		48,100		836,940
WebMD Health Corp. *		72,500		1,750,875
Websense, Inc. *		53,504		954,511
WEX, Inc. *		55,976		4,241,861
XO Group, Inc. *		39,800		448,148
Xoom Corp. *		10,400		191,984
Yelp, Inc. *		11,600		301,948
Zillow, Inc., Class A (c)*		7,000		411,810
Zix Corp. *		88,900		334,264
				150,973,061
Technology Hardware & Equipment 4.7%
3D Systems Corp. (c)*		111,300		4,256,112
ADTRAN, Inc.		91,200		1,915,200
Aeroflex Holding Corp. *		26,600		197,904
Agilysys, Inc. *		24,000		280,320
Ambient Corp. *		36,500		72,635
Anaren, Inc. *		20,200		472,882
Anixter International, Inc.		40,100		2,876,774
ARRIS Group, Inc. *		161,760		2,670,658
Aruba Networks, Inc. *		161,800		3,638,882
Audience, Inc. *		8,300		122,757
Aviat Networks, Inc. *		81,200		259,840
Avid Technology, Inc. *		39,705		261,656
Aware, Inc.		15,800		76,314
Badger Meter, Inc.		20,203		882,467
Bel Fuse, Inc., Class B		14,100		207,552
Benchmark Electronics, Inc. *		81,294		1,450,285
Black Box Corp.		24,092		523,278
CalAmp Corp. *		50,100		557,613
Calix, Inc. *		58,800		501,564
Checkpoint Systems, Inc. *		61,644		713,221
Ciena Corp. *		141,900		2,122,824
Cognex Corp.		61,309		2,433,967
Coherent, Inc.		33,451		1,870,914
Comtech Telecommunications Corp.		24,500		602,945
Cray, Inc. *		56,400		1,193,424
CTS Corp.		46,000		489,900
Daktronics, Inc.		50,700		506,493
Datalink Corp. *		20,900		233,871
Digi International, Inc. *		33,900		309,168
DTS, Inc. *		24,942		418,527
Echelon Corp. *		60,600		133,926
Electro Rent Corp.		25,200		417,564
Electro Scientific Industries, Inc.		30,200		325,556
Electronics for Imaging, Inc. *		65,209		1,742,385
Emulex Corp. *		129,190		775,140
Extreme Networks, Inc. *		135,200		450,216
Fabrinet *		30,100		413,273
FARO Technologies, Inc. *		23,200		899,928
FEI Co.		55,200		3,526,176
Finisar Corp. *		129,200		1,658,928
Globecomm Systems, Inc. *		34,300		420,175
GSI Group, Inc. *		40,000		341,600
Harmonic, Inc. *		176,700		1,003,656
Imation Corp. *		40,200		147,936
Immersion Corp. *		38,200		404,538
Infinera Corp. *		164,500		1,385,090
Insight Enterprises, Inc. *		65,500		1,186,860
InterDigital, Inc.		59,200		2,629,072
Intermec, Inc. *		87,540		861,394
Intevac, Inc. *		30,600		138,618
InvenSense, Inc. *		50,000		466,000
Ixia *		63,764		1,050,193
KEMET Corp. *		59,100		368,193
Key Tronic Corp. *		14,400		162,720
KVH Industries, Inc. *		19,900		262,879
Littelfuse, Inc.		31,800		2,220,276
Maxwell Technologies, Inc. *		43,400		264,740
Measurement Specialties, Inc. *		21,300		911,001
Mercury Systems, Inc. *		44,600		344,758
Mesa Laboratories, Inc.		3,600		177,696
Methode Electronics, Inc.		56,700		815,346
MTS Systems Corp.		23,775		1,449,086
Multi-Fineline Electronix, Inc. *		12,100		184,404
Neonode, Inc. (c)*		30,900		176,439
NETGEAR, Inc. *		53,400		1,590,786
Newport Corp. *		57,700		874,155
NumereX Corp., Class A *		16,600		171,312
Oclaro, Inc. (c)*		101,300		137,768
OCZ Technology Group, Inc. (c)*		95,200		124,712
Oplink Communications, Inc. *		26,200		430,204
OSI Systems, Inc. *		28,100		1,610,130
Park Electrochemical Corp.		29,300		699,391
ParkerVision, Inc. (c)*		117,300		468,027
PC Connection, Inc.		12,500		193,000
PC-Tel, Inc.		25,400		169,418
Plantronics, Inc.		61,493		2,694,623
Plexus Corp. *		48,962		1,320,505
Power-One, Inc. *		91,200		576,384
Procera Networks, Inc. *		28,000		310,520
QLogic Corp. *		130,100		1,412,886
Quantum Corp. *		321,700		460,031
Radisys Corp. *		38,000		188,480
RealD, Inc. (c)*		60,400		904,188
Richardson Electronics Ltd.		18,900		221,697
Rofin-Sinar Technologies, Inc. *		40,036		996,896
Rogers Corp. *		23,167		987,841
Ruckus Wireless, Inc. (c)*		11,700		225,810
Sanmina Corp. *		115,300		1,455,086
ScanSource, Inc. *		40,578		1,175,545
ShoreTel, Inc. *		63,200		228,152
Silicon Graphics International Corp. *		46,000		598,000
Sonus Networks, Inc. *		309,258		649,442
STEC, Inc. *		49,000		177,870
Super Micro Computer, Inc. *		40,000		384,800
Symmetricom, Inc. *		58,000		301,600
Synaptics, Inc. *		47,700		1,966,671

See financial notes 35

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
SYNNEX Corp. *		38,600		1,335,560
Tellabs, Inc.		540,100		1,118,007
Telular Corp.		22,800		291,156
TESSCO Technologies, Inc.		7,400		151,256
TTM Technologies, Inc. *		72,500		524,175
Ubiquiti Networks, Inc.		17,300		267,285
Universal Display Corp. *		58,400		1,836,096
ViaSat, Inc. *		53,119		2,574,678
Viasystems Group, Inc. *		7,000		89,040
Vishay Precision Group, Inc. *		16,500		236,445
Westell Technologies, Inc., Class A *		71,100		139,356
Zygo Corp. *		23,500		351,560
				92,456,253
Telecommunication Services 0.7%
8x8, Inc. *		108,600		785,178
Atlantic Tele-Network, Inc.		12,600		639,702
Boingo Wireless, Inc. *		21,700		135,191
Cbeyond, Inc. *		37,400		328,372
Cincinnati Bell, Inc. *		303,745		1,069,182
Cogent Communications Group, Inc.		66,300		1,898,832
Consolidated Communications Holdings, Inc.		57,625		1,062,029
Fairpoint Communications, Inc. (c)*		28,900		235,246
General Communication, Inc., Class A *		50,300		488,413
Hawaiian Telcom Holdco, Inc. *		14,100		340,797
HickoryTech Corp.		17,900		184,012
IDT Corp., Class B		23,500		347,565
inContact, Inc. *		51,900		420,390
Iridium Communications, Inc. *		68,200		457,622
Leap Wireless International, Inc. (c)*		73,500		420,420
Lumos Networks Corp.		20,100		271,149
magicJack VocalTec Ltd. (c)*		20,700		342,171
Neutral Tandem, Inc.		38,300		114,134
NTELOS Holdings Corp.		20,150		296,608
ORBCOMM, Inc. *		46,400		219,472
Premiere Global Services, Inc. *		70,000		786,100
Primus Telecommunications Group, Inc.		16,700		209,919
Shenandoah Telecommunications Co.		34,800		570,372
Towerstream Corp. (c)*		103,600		248,640
USA Mobility, Inc.		36,500		495,305
Vonage Holdings Corp. *		218,500		666,425
				13,033,246
Transportation 2.5%
Air Transport Services Group, Inc. *		72,100		416,017
Alaska Air Group, Inc. *		101,700		6,268,788
Allegiant Travel Co.		21,600		1,941,840
AMERCO		12,704		2,041,533
Arkansas Best Corp.		34,072		358,097
Atlas Air Worldwide Holdings, Inc. *		37,400		1,398,760
Avis Budget Group, Inc. *		151,900		4,380,796
Celadon Group, Inc.		26,900		451,651
Echo Global Logistics, Inc. *		20,300		352,205
Forward Air Corp.		42,982		1,585,606
Genco Shipping & Trading Ltd. (c)*		48,200		82,422
Genesee & Wyoming, Inc., Class A *		63,700		5,427,240
Hawaiian Holdings, Inc. *		75,200		412,848
Heartland Express, Inc.		67,500		915,975
Hub Group, Inc., Class A *		53,492		1,960,482
International Shipholding Corp.		7,300		131,838
JetBlue Airways Corp. *		334,400		2,304,016
Knight Transportation, Inc.		81,700		1,276,154
Marten Transport Ltd.		20,800		423,696
Old Dominion Freight Line, Inc. *		103,424		3,981,824
Pacer International, Inc. *		46,900		266,861
Park-Ohio Holdings Corp. *		11,200		411,936
Patriot Transportation Holding, Inc. *		8,700		251,865
Quality Distribution, Inc. *		29,300		233,228
Rand Logistics, Inc. (c)*		24,300		141,426
Republic Airways Holdings, Inc. *		74,100		829,179
Roadrunner Transportation Systems, Inc. *		22,500		506,475
Saia, Inc. *		23,400		957,528
SkyWest, Inc.		70,812		1,013,319
Spirit Airlines, Inc. *		61,900		1,652,730
Swift Transportation Co. *		110,900		1,554,818
Universal Truckload Services, Inc. *		7,300		184,252
US Airways Group, Inc. (c)*		233,600		3,947,840
Werner Enterprises, Inc.		64,643		1,484,203
Wesco Aircraft Holdings, Inc. *		24,000		396,240
XPO Logistics, Inc. (c)*		24,200		394,702
				50,338,390
Utilities 3.4%
ALLETE, Inc.		54,390		2,792,927
American DG Energy, Inc. (c)*		53,400		98,256
American States Water Co.		26,700		1,481,316
Artesian Resources Corp., Class A		10,500		247,485
Atlantic Power Corp.		168,900		793,830
Avista Corp.		85,912		2,409,832
Black Hills Corp.		62,298		2,921,153
Cadiz, Inc. *		16,200		95,418
California Water Service Group		67,074		1,344,834
CH Energy Group, Inc.		20,797		1,351,181
Chesapeake Utilities Corp.		13,800		736,368
Cleco Corp.		88,300		4,372,616
Connecticut Water Service, Inc.		15,000		427,200
Consolidated Water Co., Ltd.		19,500		194,415
Delta Natural Gas Co., Inc.		9,300		201,624
El Paso Electric Co.		58,716		2,199,501
Genie Energy Ltd., Class B		18,600		200,508
IDACORP, Inc.		72,900		3,587,409
MGE Energy, Inc.		33,960		1,896,666
Middlesex Water Co.		20,900		409,849
New Jersey Resources Corp.		60,000		2,832,000
Northwest Natural Gas Co.		37,895		1,685,191
NorthWestern Corp.		51,512		2,216,046
Ormat Technologies, Inc.		24,000		521,760
Otter Tail Corp.		51,209		1,597,721
Piedmont Natural Gas Co., Inc.		108,000		3,718,440
PNM Resources, Inc.		114,000		2,737,140

36 See financial notes

 Schwab Small-Cap Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Portland General Electric Co.		109,900		3,544,275
SJW Corp.		20,700		524,952
South Jersey Industries, Inc.		43,060		2,656,802
Southwest Gas Corp.		66,296		3,359,218
The Empire District Electric Co.		62,100		1,432,647
The Laclede Group, Inc.		31,777		1,484,304
UIL Holdings Corp.		73,110		3,044,300
Unitil Corp.		18,500		560,735
UNS Energy Corp.		57,317		2,920,874
WGL Holdings, Inc.		74,800		3,457,256
York Water Co.		17,000		318,750
				66,374,799
Total Common Stock
(Cost $1,425,295,460)				1,923,145,535
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Indevus Pharmaceuticals, Inc. (a)(b)*		138,800		—
Total Rights
(Cost $—)				—
Warrants 0.0% of net assets
Energy 0.0%
Magnum Hunter Resources Corp. (b)*		19,700		2,758
Total Warrants
(Cost $—)				2,758
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 2.5% of net assets
Time Deposit 2.3%
DNB
0.03%, 05/01/13		45,606,267		45,606,267
U.S. Treasury Obligations 0.2%
U.S. Treasury Bills
0.01%, 06/20/13 (d)(e)		100,000		99,990
0.03%, 06/20/13 (d)(e)		300,000		299,969
0.09%, 06/20/13 (d)(e)		2,002,000		2,001,793
				2,401,752
Total Short-Term Investments
(Cost $48,008,019)				48,008,019
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 4.5% of net assets
Wells Fargo Advantage Government Money Market Fund		89,167,306		89,167,306
Total Collateral Invested for Securities on Loan
(Cost $89,167,306)				89,167,306
End of Collateral Invested for Securities on Loan.

At 04/30/13 tax basis cost of the fund’s investments was $1,479,083,260 and the unrealized appreciation and depreciation were $611,940,951 and ($119,867,899), respectively, with a net unrealized appreciation of $492,073,052.

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(b)	Illiquid security. At the period end, the value of these amounted to $2,758 or 0.0% of net assets.
(c)	All or a portion of this security is on loan.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
Russell 2000 Index, mini, Long, expires 06/21/13		450		42,529,500		651,224

See financial notes 37

 Schwab Total Stock Market Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	98	.0%	Common Stock		1,813,770,978		2,648,285,384
	0	.0%	Rights		—		—
	0	.0%	Warrants		—		4
	1	.8%	Short-Term Investments		49,546,906		49,546,906
	99	.8%	Total Investments		1,863,317,884		2,697,832,294
	0	.7%	Collateral Invested for Securities on Loan		19,140,972		19,140,972
	(0	.5)%	Other Assets and Liabilities, Net				(14,184,574	)
	100	.0%	Net Assets				2,702,788,692

	Number		Value
Security	of Shares		($)
Common Stock 98.0% of net assets
Automobiles & Components 1.0%
Allison Transmission Holdings, Inc.		5,200		118,612
American Axle & Manufacturing Holdings, Inc. *		8,300		110,971
BorgWarner, Inc. *		17,100		1,336,707
Cooper Tire & Rubber Co.		8,900		221,521
Dana Holding Corp.		19,500		336,375
Delphi Automotive plc		43,800		2,023,998
Dorman Products, Inc.		3,000		113,220
Drew Industries, Inc.		5,400		194,940
Exide Technologies *		24,400		20,669
Federal-Mogul Corp. *		12,900		96,492
Ford Motor Co.		593,436		8,136,008
General Motors Co. *		115,100		3,549,684
Gentex Corp.		20,600		463,500
Harley-Davidson, Inc.		33,500		1,830,775
Johnson Controls, Inc.		103,100		3,609,531
Lear Corp.		14,000		808,920
Modine Manufacturing Co. *		12,100		110,594
Standard Motor Products, Inc.		7,500		229,800
Stoneridge, Inc. *		13,100		99,167
Strattec Security Corp.		1,500		54,705
Tenneco, Inc. *		8,780		339,523
Tesla Motors, Inc. (d)*		10,700		577,693
The Goodyear Tire & Rubber Co. *		33,900		423,580
Thor Industries, Inc.		7,500		278,175
TRW Automotive Holdings Corp. *		17,600		1,057,232
Visteon Corp. *		8,000		470,320
Winnebago Industries, Inc. *		7,400		135,568
				26,748,280
Banks 3.2%
1st Source Corp.		5,528		130,074
Ameris Bancorp *		6,348		88,047
Arrow Financial Corp.		3,324		80,408
Associated Banc-Corp.		25,000		356,750
Astoria Financial Corp.		11,300		108,367
BancFirst Corp.		2,300		96,232
BancorpSouth, Inc.		10,112		161,792
Bank Mutual Corp.		18,268		94,628
Bank of Hawaii Corp.		6,500		309,985
Bank of the Ozarks, Inc.		5,600		229,208
BankUnited, Inc.		6,000		152,100
Banner Corp.		3,171		103,597
BB&T Corp.		107,958		3,321,868
BBCN Bancorp, Inc.		11,000		141,680
Beneficial Mutual Bancorp, Inc. *		10,500		89,775
Berkshire Bancorp, Inc.		3,600		31,068
Berkshire Hills Bancorp, Inc.		3,400		87,924
BOK Financial Corp.		3,740		233,713
Boston Private Financial Holdings, Inc.		12,129		116,924
Brookline Bancorp, Inc.		11,705		98,322
Bryn Mawr Bank Corp.		3,400		78,982
Camco Financial Corp. *		700		2,499
Camden National Corp.		2,500		83,475
Capital Bank Financial Corp., Class A *		3,500		62,545
Capital City Bank Group, Inc. *		6,875		85,938
CapitalSource, Inc.		32,900		294,455
Capitol Federal Financial, Inc.		21,963		260,042
Cardinal Financial Corp.		3,700		56,425
Cathay General Bancorp		9,200		181,332
Central Pacific Financial Corp. *		5,169		87,046
Century Bancorp, Inc., Class A		800		27,184
Chemical Financial Corp.		5,383		133,498
CIT Group, Inc. *		29,300		1,245,543
City Holding Co.		4,800		183,264
City National Corp.		7,000		400,610
Columbia Banking System, Inc.		9,951		213,648
Comerica, Inc.		27,659		1,002,639
Commerce Bancshares, Inc.		10,984		440,568
Community Bank System, Inc.		6,400		183,296
Community Trust Bancorp, Inc.		2,487		86,100
Cullen/Frost Bankers, Inc.		9,100		549,731
CVB Financial Corp.		10,311		112,081
Dime Community Bancshares, Inc.		6,875		98,106
Eagle Bancorp, Inc. *		2,800		64,764
East West Bancorp, Inc.		19,600		476,868
EverBank Financial Corp.		8,900		142,400
F.N.B. Corp.		19,661		223,939
Fifth Third Bancorp		132,714		2,260,119
First BanCorp *		26,579		157,082
First Busey Corp.		20,200		86,860
First Citizens BancShares, Inc., Class A		900		167,778
First Commonwealth Financial Corp.		13,504		96,554
First Financial Bancorp		10,339		158,910

38 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
First Financial Bankshares, Inc. (d)		6,000		296,460
First Financial Corp.		2,600		80,314
First Financial Holdings, Inc.		6,100		122,244
First Horizon National Corp.		32,816		341,286
First Interstate BancSystem, Inc.		3,600		73,152
First M&F Corp.		2,000		28,800
First Merchants Corp.		9,041		146,735
First Midwest Bancorp, Inc.		9,125		114,519
First Niagara Financial Group, Inc.		50,265		478,020
First Republic Bank		11,000		417,780
First United Corp. *		2,200		18,612
Firstmerit Corp.		24,489		419,497
Flagstar Bancorp, Inc. *		8,060		100,025
Flushing Financial Corp.		6,800		103,224
Fulton Financial Corp.		28,262		312,578
Glacier Bancorp, Inc.		10,497		193,670
Great Southern Bancorp, Inc.		3,400		89,658
Hancock Holding Co.		12,344		336,621
Hawthorn Bancshares, Inc.		876		10,258
Heartland Financial USA, Inc.		2,500		63,525
Heritage Financial Corp.		6,135		85,583
Home Bancshares, Inc.		3,300		131,076
Hudson City Bancorp, Inc.		69,231		575,310
Huntington Bancshares, Inc.		127,599		914,885
IBERIABANK Corp.		3,875		176,777
Independent Bank Corp.		3,000		93,120
Independent Bank Corp., Michigan *		431		3,047
International Bancshares Corp.		7,784		151,010
Investors Bancorp, Inc.		9,600		190,080
Kearny Financial Corp. *		9,000		88,650
KeyCorp		138,090		1,376,757
Lakeland Financial Corp.		3,700		99,160
M&T Bank Corp.		18,949		1,898,690
MainSource Financial Group, Inc.		5,535		70,128
MB Financial, Inc.		8,133		201,373
Merchants Bancshares, Inc.		3,650		110,741
MGIC Investment Corp. *		45,600		246,240
MutualFirst Financial, Inc.		2,000		32,140
National Bank Holdings Corp., Class A		1,500		27,090
National Penn Bancshares, Inc.		17,675		173,038
Nationstar Mortgage Holdings, Inc. (d)*		3,100		113,987
NBT Bancorp, Inc.		6,900		139,725
New York Community Bancorp, Inc.		64,985		880,547
North Valley Bancorp *		300		5,277
Northfield Bancorp, Inc.		5,365		63,092
Northrim BanCorp, Inc.		4,281		93,240
Northwest Bancshares, Inc.		11,250		137,812
OceanFirst Financial Corp.		7,150		101,601
Ocwen Financial Corp. *		16,420		600,644
OFG Bancorp		8,163		131,179
Old National Bancorp		16,800		204,624
Oritani Financial Corp.		6,000		92,820
PacWest Bancorp		6,000		166,380
Park National Corp. (d)		2,845		194,541
People’s United Financial, Inc.		49,587		652,565
Peoples Financial Corp.		3,000		38,250
Pinnacle Financial Partners, Inc. *		6,475		157,148
PNC Financial Services Group, Inc.		80,732		5,480,088
Popular, Inc. *		14,720		419,373
Premier Financial Bancorp, Inc.		2,645		32,269
PrivateBancorp, Inc.		8,000		153,440
Prosperity Bancshares, Inc.		6,400		294,016
Provident Financial Holdings, Inc.		4,350		70,470
Provident Financial Services, Inc.		7,917		121,368
Radian Group, Inc.		24,500		292,775
Regions Financial Corp.		209,062		1,774,936
Renasant Corp.		4,125		94,132
Republic Bancorp, Inc., Class A		6,521		144,766
Roma Financial Corp.		5,900		100,418
S&T Bancorp, Inc.		4,400		83,028
S.Y. Bancorp, Inc.		3,670		84,263
Sandy Spring Bancorp, Inc.		5,900		120,832
SCBT Financial Corp.		3,000		143,310
Seacoast Banking Corp. of Florida *		19,680		42,115
Shore Bancshares, Inc. *		1,250		8,750
Signature Bank *		6,700		479,787
Simmons First National Corp., Class A		4,000		98,080
Southside Bancshares, Inc.		4,515		96,531
Southwest Bancorp, Inc. *		7,800		103,116
State Bank Financial Corp.		6,200		91,202
StellarOne Corp.		6,000		89,940
Sterling Bancorp		9,018		101,723
Sterling Financial Corp.		5,000		109,000
Suffolk Bancorp *		4,600		71,944
Sun Bancorp, Inc. *		19,318		62,204
SunTrust Banks, Inc.		80,342		2,350,003
Susquehanna Bancshares, Inc.		27,568		321,719
SVB Financial Group *		6,400		455,104
Synovus Financial Corp.		110,700		297,783
Taylor Capital Group, Inc. *		3,400		49,810
TCF Financial Corp.		22,900		333,195
Texas Capital Bancshares, Inc. *		5,400		224,964
TFS Financial Corp. *		19,500		211,965
The First of Long Island Corp.		4,000		120,840
Timberland Bancorp, Inc.		2,000		16,500
Tompkins Financial Corp.		4,024		168,203
TowneBank		3,800		54,378
Tree.com, Inc.		4,444		90,969
TriCo Bancshares		5,400		94,338
TrustCo Bank Corp.		20,657		110,722
Trustmark Corp.		8,562		210,197
U.S. Bancorp		280,531		9,336,072
UMB Financial Corp.		5,274		265,493
Umpqua Holdings Corp.		15,743		188,916
Union First Market Bankshares Corp.		7,050		133,315
United Bankshares, Inc.		7,400		187,294
United Community Banks, Inc. *		11,678		127,874
Valley National Bancorp		30,542		274,573
ViewPoint Financial Group, Inc.		4,900		91,238
Walker & Dunlop, Inc. *		3,100		55,211
Washington Federal, Inc.		14,942		256,554
Washington Trust Bancorp, Inc.		3,600		96,300
Webster Financial Corp.		11,663		272,564
Wells Fargo & Co.		740,406		28,120,620
WesBanco, Inc.		4,456		111,534

See financial notes 39

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Westamerica Bancorp		5,200		225,628
Western Alliance Bancorp *		9,500		139,745
Wilshire Bancorp, Inc. *		9,900		63,261
Wintrust Financial Corp.		5,800		207,988
WSFS Financial Corp.		2,000		97,880
Zions Bancorp		27,525		677,665
				86,706,339
Capital Goods 7.7%
3M Co.		96,000		10,052,160
A.O. Smith Corp.		5,650		426,180
AAON, Inc.		4,569		129,805
AAR Corp.		5,000		89,300
Aceto Corp.		7,900		82,160
Actuant Corp., Class A		10,280		321,764
Acuity Brands, Inc.		6,000		437,760
AECOM Technology Corp. *		16,100		468,027
Aegion Corp. *		4,300		90,558
Aerosonic Corp. *		300		2,322
Aerovironment, Inc. *		4,200		81,312
AGCO Corp.		13,862		738,151
Air Lease Corp.		9,400		258,594
Aircastle Ltd.		14,100		196,836
Alamo Group, Inc.		2,500		100,175
Albany International Corp., Class A		3,918		113,818
Alliant Techsystems, Inc.		4,437		329,935
Altra Holdings, Inc.		4,300		114,595
American Railcar Industries, Inc.		2,800		99,988
American Science & Engineering, Inc.		2,000		128,960
American Superconductor Corp. (d)*		5,200		13,052
American Woodmark Corp. *		4,000		134,600
AMETEK, Inc.		35,925		1,462,507
Ampco-Pittsburgh Corp.		4,500		84,330
Apogee Enterprises, Inc.		6,600		168,168
Applied Industrial Technologies, Inc.		6,525		275,681
Armstrong World Industries, Inc. *		3,500		178,640
Astec Industries, Inc.		5,700		187,131
Astronics Corp. *		3,438		95,576
AZZ, Inc.		3,500		148,015
B/E Aerospace, Inc. *		15,500		972,470
Barnes Group, Inc.		6,600		183,282
Beacon Roofing Supply, Inc. *		6,600		251,658
Belden, Inc.		6,900		340,998
Blount International, Inc. *		6,200		86,118
Brady Corp., Class A		6,400		216,832
Breeze-Eastern Corp. *		500		4,250
Briggs & Stratton Corp.		6,500		146,185
Builders FirstSource, Inc. *		17,100		105,849
Carlisle Cos., Inc.		9,200		596,804
Caterpillar, Inc.		98,900		8,373,863
Chart Industries, Inc. *		4,400		373,164
CIRCOR International, Inc.		3,750		177,488
CLARCOR, Inc.		7,300		377,410
Coleman Cable, Inc.		4,500		67,500
Colfax Corp. *		9,400		438,698
Columbus McKinnon Corp. *		4,300		80,754
Comfort Systems USA, Inc.		7,700		98,791
Crane Co.		8,000		430,640
Cubic Corp.		4,500		193,365
Cummins, Inc.		26,400		2,808,696
Curtiss-Wright Corp.		6,600		216,744
Danaher Corp.		87,800		5,350,532
Deere & Co.		58,400		5,215,120
DigitalGlobe, Inc. *		12,322		359,679
Donaldson Co., Inc.		19,300		702,134
Dover Corp.		26,100		1,800,378
Ducommun, Inc. *		3,200		78,368
DXP Enterprises, Inc. *		1,700		113,696
Dycom Industries, Inc. *		5,300		102,396
Eaton Corp. plc		70,377		4,321,852
EMCOR Group, Inc.		9,400		351,560
Emerson Electric Co.		108,000		5,995,080
Encore Wire Corp.		2,500		81,875
EnerSys, Inc. *		7,500		343,800
Engility Holdings, Inc. *		4,116		98,619
EnPro Industries, Inc. *		3,000		147,840
ESCO Technologies, Inc.		3,900		140,283
Esterline Technologies Corp. *		4,400		330,176
Exelis, Inc.		27,400		306,058
Fastenal Co.		40,200		1,971,810
Federal Signal Corp. *		12,800		99,328
Flow International Corp. *		17,000		62,220
Flowserve Corp.		7,700		1,217,524
Fluor Corp.		24,300		1,384,614
Fortune Brands Home & Security, Inc. *		23,700		862,443
Foster Wheeler AG *		15,200		320,720
Franklin Electric Co., Inc.		5,600		181,272
FreightCar America, Inc.		2,500		52,200
FuelCell Energy, Inc. *		29,400		30,870
Furmanite Corp. *		7,200		45,720
Gardner Denver, Inc.		7,200		540,648
GATX Corp.		6,600		336,270
GenCorp, Inc. *		11,600		151,612
Generac Holdings, Inc.		6,900		247,917
General Cable Corp. *		6,700		231,016
General Dynamics Corp.		50,600		3,742,376
General Electric Co.		1,567,266		34,934,359
Gibraltar Industries, Inc. *		6,300		117,810
Graco, Inc.		8,812		533,390
GrafTech International Ltd. *		16,600		119,188
Granite Construction, Inc.		4,850		134,200
Great Lakes Dredge & Dock Corp.		11,600		80,272
Griffon Corp.		15,100		155,530
H&E Equipment Services, Inc.		6,800		138,448
Hardinge, Inc.		4,800		64,800
Harsco Corp.		11,300		246,679
HEICO Corp.		6,700		294,867
Hexcel Corp. *		14,500		442,250
Honeywell International, Inc.		118,262		8,696,987
Hubbell, Inc., Class B		7,900		758,084
Huntington Ingalls Industries, Inc.		6,972		368,819
Hyster-Yale Materials Handling, Inc.		2,300		120,037
IDEX Corp.		11,725		610,052
II-VI, Inc. *		7,600		117,572
Illinois Tool Works, Inc.		63,100		4,073,736
Ingersoll-Rand plc		41,500		2,232,700
Integrated Electrical Services, Inc. *		5,105		29,762

40 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
ITT Corp.		13,500		372,600
Jacobs Engineering Group, Inc. *		19,000		959,120
John Bean Technologies Corp.		4,983		103,347
Joy Global, Inc.		16,350		924,102
Kadant, Inc.		3,001		83,038
Kaman Corp.		3,000		101,370
Kaydon Corp.		7,700		183,568
KBR, Inc.		21,000		631,680
Kennametal, Inc.		11,300		451,887
Kratos Defense & Security Solutions, Inc. *		10,180		51,816
L-3 Communications Holdings, Inc.		13,600		1,105,000
L.B. Foster Co., Class A		1,400		61,810
Lawson Products, Inc.		5,500		77,825
Layne Christensen Co. *		4,500		91,935
Lennox International, Inc.		6,771		419,802
Lincoln Electric Holdings, Inc.		11,800		622,568
Lindsay Corp.		1,800		138,276
Lockheed Martin Corp.		40,852		4,048,025
Lydall, Inc. *		5,500		78,870
Magnetek, Inc. *		1,650		25,757
Masco Corp.		53,300		1,036,152
MasTec, Inc. *		8,550		237,690
Meritor, Inc. *		22,600		131,080
Michael Baker Corp.		4,200		102,270
Middleby Corp. *		2,600		388,908
Moog, Inc., Class A *		5,787		267,417
MRC Global, Inc. *		10,200		305,490
MSC Industrial Direct Co., Inc., Class A		6,900		543,720
Mueller Industries, Inc.		5,400		279,612
Mueller Water Products, Inc., Class A		23,139		136,983
MYR Group, Inc. *		2,800		63,840
National Presto Industries, Inc. (d)		1,200		90,000
Navistar International Corp. *		11,600		384,192
NCI Building Systems, Inc. *		2,580		44,170
NN, Inc. *		1,800		16,218
Nordson Corp.		8,000		555,920
Nortek, Inc. *		1,800		129,348
Northrop Grumman Corp.		36,332		2,751,786
Omega Flex, Inc.		700		9,429
Orbital Sciences Corp. *		7,600		136,952
Oshkosh Corp. *		12,900		506,454
Owens Corning *		16,700		702,402
PACCAR, Inc.		52,625		2,619,672
Pall Corp.		16,600		1,107,386
Parker Hannifin Corp.		22,100		1,957,397
Pentair Ltd.		30,628		1,664,632
Polypore International, Inc. (d)*		6,100		255,773
Powell Industries, Inc. *		2,800		137,872
Precision Castparts Corp.		22,102		4,227,892
Preformed Line Products Co.		1,000		80,500
Primoris Services Corp.		6,900		152,076
Proto Labs, Inc. *		2,800		143,024
Quanex Building Products Corp.		5,625		91,519
Quanta Services, Inc. *		31,071		853,831
Raven Industries, Inc.		5,600		187,880
Raytheon Co.		49,200		3,019,896
RBC Bearings, Inc. *		3,000		144,300
Regal-Beloit Corp.		6,500		511,030
Rexnord Corp. *		9,300		169,446
Rockwell Automation, Inc.		20,800		1,763,424
Rockwell Collins, Inc.		20,900		1,315,028
Roper Industries, Inc.		14,700		1,758,855
Rush Enterprises, Inc., Class A *		4,600		105,294
Simpson Manufacturing Co., Inc.		6,200		178,188
Snap-on, Inc.		8,200		706,840
Solarcity Corp. (d)*		4,300		116,186
Spirit AeroSystems Holdings, Inc., Class A *		14,500		289,855
SPX Corp.		7,110		529,766
Standex International Corp.		3,000		158,700
Stanley Black & Decker, Inc.		24,652		1,844,216
Sun Hydraulics Corp.		3,000		98,250
TAL International Group, Inc.		3,900		161,460
Taser International, Inc. *		11,800		103,958
Tecumseh Products Co., Class A *		9,100		80,990
Teledyne Technologies, Inc. *		5,157		387,084
Tennant Co.		4,200		200,844
Terex Corp. *		16,100		460,460
Textainer Group Holdings Ltd.		2,500		96,675
Textron, Inc.		41,100		1,058,325
The Babcock & Wilcox Co.		17,400		473,280
The Boeing Co.		102,600		9,378,666
The Gorman-Rupp Co.		4,113		116,192
The Greenbrier Cos., Inc. *		5,800		130,848
The KEYW Holding Corp. *		4,800		65,232
The Manitowoc Co., Inc.		18,500		347,060
The Timken Co.		11,900		625,583
The Toro Co.		8,200		369,082
Thermon Group Holdings, Inc. *		3,500		68,600
Titan International, Inc.		6,925		154,497
Titan Machinery, Inc. *		3,600		81,216
TransDigm Group, Inc.		6,600		968,880
Trex Co., Inc. *		2,700		131,436
TriMas Corp. *		4,700		143,350
Trinity Industries, Inc.		13,650		576,166
Triumph Group, Inc.		7,000		559,300
Tutor Perini Corp. *		7,100		116,724
United Rentals, Inc. *		13,100		689,191
United Technologies Corp.		127,068		11,600,038
Universal Forest Products, Inc.		2,500		96,500
URS Corp.		10,700		469,944
USG Corp. *		12,500		324,875
Valmont Industries, Inc.		3,500		510,055
Vicor Corp. *		9,900		53,163
W.W. Grainger, Inc.		8,800		2,168,936
Wabash National Corp. *		11,200		105,616
WABCO Holdings, Inc. *		9,233		666,900
Wabtec Corp.		7,128		748,012
Watsco, Inc.		4,200		354,396
Watts Water Technologies, Inc., Class A		4,000		188,240
WESCO International, Inc. *		6,300		451,647
Woodward, Inc.		8,000		287,920
Xylem, Inc.		27,700		768,675
				207,020,380
Commercial & Professional Supplies 1.1%
A.T. Cross Co., Class A *		2,900		36,598
ABM Industries, Inc.		7,200		162,360
Acacia Research Corp. *		6,200		147,684

See financial notes 41

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Acco Brands Corp. *		15,378		103,802
AMREP Corp. *		2,500		22,625
ARC Document Solutions, Inc. *		7,000		22,470
Avery Dennison Corp.		14,600		605,170
Casella Waste Systems, Inc., Class A *		13,300		57,988
CDI Corp.		5,500		86,185
Cenveo, Inc. (d)*		7,300		14,892
Cintas Corp.		15,350		688,754
Clean Harbors, Inc. *		7,700		438,669
Compx International, Inc.		2,000		25,000
Consolidated Graphics, Inc. *		3,900		139,113
Copart, Inc. *		17,618		621,034
Covanta Holding Corp.		18,900		378,000
CRA International, Inc. *		4,200		77,448
Deluxe Corp.		6,800		259,352
EnergySolutions, Inc. *		18,500		76,405
Ennis, Inc.		6,500		99,905
Equifax, Inc.		17,695		1,082,934
Exponent, Inc.		1,900		100,130
FTI Consulting, Inc. *		5,700		188,784
G&K Services, Inc., Class A		4,100		192,659
GP Strategies Corp. *		1,500		33,075
Healthcare Services Group, Inc.		12,656		282,102
Heidrick & Struggles International, Inc.		5,000		66,100
Herman Miller, Inc.		8,700		218,283
HNI Corp.		6,400		220,352
Hudson Global, Inc. *		3,220		10,626
Huron Consulting Group, Inc. *		3,000		125,340
ICF International, Inc. *		2,800		75,908
IHS, Inc., Class A *		7,800		759,954
InnerWorkings, Inc. *		7,400		74,518
Insperity, Inc.		6,800		187,884
Interface, Inc.		8,400		140,616
Iron Mountain, Inc.		25,238		955,511
KAR Auction Services, Inc.		16,200		362,394
Kelly Services, Inc., Class A		5,700		97,014
Kforce, Inc.		7,105		107,428
Kimball International, Inc., Class B		9,100		83,629
Knoll, Inc.		7,000		108,920
Korn/Ferry International *		6,600		109,230
Manpowergroup, Inc.		11,191		594,914
Mastech Holdings, Inc.		540		3,942
McGrath RentCorp		4,600		142,876
Mine Safety Appliances Co.		4,700		225,600
Mistras Group, Inc. *		4,000		75,800
Mobile Mini, Inc. *		6,200		174,406
Multi-Color Corp.		4,625		119,602
Navigant Consulting, Inc. *		14,000		172,620
Nielsen Holdings N.V.		24,300		841,266
NL Industries, Inc.		7,800		87,906
On Assignment, Inc. *		6,500		157,755
Performant Financial Corp. *		7,700		74,921
Pitney Bowes, Inc. (d)		28,200		385,494
Quad Graphics, Inc. (d)		5,600		117,040
R.R. Donnelley & Sons Co. (d)		23,500		289,285
Republic Services, Inc.		44,245		1,507,870
Resources Connection, Inc.		11,300		128,368
Robert Half International, Inc.		21,000		689,220
Rollins, Inc.		9,218		224,182
RPX Corp. *		10,300		138,123
Steelcase, Inc., Class A		11,500		146,050
Stericycle, Inc. *		12,500		1,354,000
Team, Inc. *		3,000		116,280
Tetra Tech, Inc. *		12,031		316,295
The ADT Corp. *		33,866		1,477,912
The Advisory Board Co. *		4,600		226,090
The Brink’s Co.		7,100		188,221
The Corporate Executive Board Co.		4,700		264,892
The Dun & Bradstreet Corp.		6,940		613,843
The Standard Register Co. *		4,100		2,829
Towers Watson & Co., Class A		8,100		590,652
TRC Cos., Inc. *		3,350		20,234
TrueBlue, Inc. *		6,000		124,320
Tyco International Ltd.		69,433		2,230,188
UniFirst Corp.		2,100		191,205
United Stationers, Inc.		5,800		188,326
Verisk Analytics, Inc., Class A *		21,500		1,317,735
Viad Corp.		3,625		94,431
Virco Mfg. Corp. *		1,170		2,375
WageWorks, Inc. *		5,000		128,050
Waste Connections, Inc.		17,912		679,760
Waste Management, Inc.		65,100		2,667,798
				28,739,521
Consumer Durables & Apparel 1.5%
American Greetings Corp., Class A		8,500		156,740
Arctic Cat, Inc. *		2,400		107,976
Blyth, Inc. (d)		7,400		121,952
Brunswick Corp.		14,400		455,904
Callaway Golf Co.		12,800		85,760
Carter’s, Inc. *		8,000		523,120
Cavco Industries, Inc. *		1,610		73,448
Coach, Inc.		42,308		2,490,249
Columbia Sportswear Co. (d)		1,750		102,550
Crocs, Inc. *		15,000		240,300
CSS Industries, Inc.		4,800		137,568
D.R. Horton, Inc.		40,704		1,061,560
Deckers Outdoor Corp. *		5,200		286,624
Ethan Allen Interiors, Inc.		4,200		122,976
Fifth & Pacific Cos., Inc. *		15,900		327,858
Flexsteel Industries, Inc.		1,900		39,121
Foamex International, Inc. (a)(c)*		2,278		—
Fossil, Inc. *		7,662		751,795
Furniture Brands International, Inc. *		4,700		5,170
G-III Apparel Group Ltd. *		2,800		113,848
Garmin Ltd. (d)		17,400		610,392
Hanesbrands, Inc. *		13,847		694,566
Harman International Industries, Inc.		9,900		442,629
Hasbro, Inc.		16,500		781,605
Helen of Troy Ltd. *		5,000		174,400
Hovnanian Enterprises, Inc., Class A (d)*		20,000		109,000
Iconix Brand Group, Inc. *		9,600		275,040
iRobot Corp. *		7,300		212,357
JAKKS Pacific, Inc.		7,500		81,825
Jarden Corp. *		17,038		766,880
KB Home		10,900		245,686
Kid Brands, Inc. *		3,000		3,390

42 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
La-Z-Boy, Inc.		7,500		135,450
LeapFrog Enterprises, Inc. *		9,000		80,460
Leggett & Platt, Inc.		20,900		673,816
Lennar Corp., Class A		23,890		984,746
M.D.C. Holdings, Inc.		5,503		206,913
M/I Homes, Inc. *		3,000		73,800
Maidenform Brands, Inc. *		5,000		90,000
Marine Products Corp.		405		2,928
Mattel, Inc.		51,200		2,337,792
Meritage Homes Corp. *		3,900		190,281
Michael Kors Holdings Ltd. *		26,200		1,491,828
Mohawk Industries, Inc. *		9,219		1,022,203
Movado Group, Inc.		5,800		175,392
NACCO Industries, Inc., Class A		1,900		110,238
Nautilus, Inc. *		9,825		67,596
Newell Rubbermaid, Inc.		42,900		1,129,986
NIKE, Inc., Class B		108,900		6,926,040
NVR, Inc. *		700		721,000
Oxford Industries, Inc.		2,500		147,825
Perry Ellis International, Inc.		5,500		96,635
Polaris Industries, Inc.		9,100		784,329
PulteGroup, Inc. *		49,576		1,040,600
PVH Corp.		11,411		1,316,944
Quiksilver, Inc. *		25,900		174,307
Ralph Lauren Corp.		9,100		1,652,378
Skechers U.S.A., Inc., Class A *		6,500		135,070
Skyline Corp. *		2,600		11,778
Smith & Wesson Holding Corp. (d)*		12,400		108,872
Standard Pacific Corp. *		15,600		141,180
Stanley Furniture Co., Inc. *		6,875		27,156
Steven Madden Ltd. *		6,075		295,427
Sturm, Ruger & Co., Inc. (d)		2,700		138,429
Superior Uniform Group, Inc.		1,600		18,592
Tandy Brands Accessories, Inc. *		1,000		510
Tempur-Pedic International, Inc. *		8,000		388,000
The Jones Group, Inc.		12,156		170,184
The Ryland Group, Inc.		6,700		301,902
Toll Brothers, Inc. *		23,400		802,854
True Religion Apparel, Inc.		4,300		116,358
Tumi Holdings, Inc. *		9,200		211,876
Tupperware Brands Corp.		7,800		626,340
Under Armour, Inc., Class A *		10,900		622,172
Universal Electronics, Inc. *		5,200		119,496
Vera Bradley, Inc. (d)*		4,200		95,844
VF Corp.		13,000		2,316,860
Whirlpool Corp.		12,249		1,399,816
Wolverine World Wide, Inc.		7,800		372,606
				41,657,098
Consumer Services 2.2%
AFC Enterprises, Inc. *		3,900		124,332
Ambassadors Group, Inc.		3,400		11,390
American Public Education, Inc. *		5,600		187,768
Ameristar Casinos, Inc.		6,400		168,896
Apollo Group, Inc., Class A *		14,550		267,284
Ascent Capital Group, Inc., Class A *		3,116		207,183
Bally Technologies, Inc. *		5,900		314,352
Biglari Holdings, Inc. *		279		108,051
BJ’s Restaurants, Inc. *		3,000		102,900
Bloomin’ Brands, Inc. *		6,000		130,500
Bob Evans Farms, Inc.		4,200		182,028
Boyd Gaming Corp. (d)*		12,300		147,600
Bridgepoint Education, Inc. *		7,900		85,162
Brinker International, Inc.		12,350		480,415
Buffalo Wild Wings, Inc. *		3,000		270,000
Burger King Worldwide, Inc. (d)		12,200		220,088
Career Education Corp. *		25,114		55,000
Carnival Corp.		66,500		2,294,915
CEC Entertainment, Inc.		2,925		97,607
Chipotle Mexican Grill, Inc. *		4,600		1,670,674
Choice Hotels International, Inc.		3,800		148,428
Churchill Downs, Inc.		2,900		221,734
Coinstar, Inc. (d)*		5,000		264,050
Corinthian Colleges, Inc. *		21,700		43,400
Cracker Barrel Old Country Store, Inc.		3,446		285,122
Darden Restaurants, Inc.		19,000		980,970
Denny’s Corp. *		21,100		119,637
DeVry, Inc.		7,800		218,478
DineEquity, Inc.		3,000		213,720
Domino’s Pizza, Inc.		8,100		447,120
Dover Downs Gaming & Entertainment, Inc.		5,899		10,854
Dover Motorsports, Inc.		1,400		2,926
Dunkin’ Brands Group, Inc.		10,200		395,862
Education Management Corp. (d)*		19,600		111,132
Grand Canyon Education, Inc. *		5,000		127,850
H&R Block, Inc.		41,000		1,137,340
Hillenbrand, Inc.		8,800		221,144
Hyatt Hotels Corp., Class A *		7,900		337,172
International Game Technology		38,100		645,795
International Speedway Corp., Class A		3,245		106,663
Interval Leisure Group, Inc.		6,269		119,487
Isle of Capri Casinos, Inc. *		11,800		90,388
ITT Educational Services, Inc. (d)*		5,600		102,536
Jack in the Box, Inc. *		8,400		301,140
K12, Inc. (d)*		4,900		124,803
Krispy Kreme Doughnuts, Inc. *		14,100		192,606
Lakes Entertainment, Inc. *		6,800		21,488
Las Vegas Sands Corp.		52,800		2,970,000
Learning Tree International, Inc. *		1,400		5,250
LIFE TIME FITNESS, Inc. *		5,500		253,990
Luby’s, Inc. *		6,900		46,989
Marriott International, Inc., Class A		36,708		1,580,646
Marriott Vacations Worldwide Corp. *		4,080		185,558
Matthews International Corp., Class A		2,900		106,749
McDonald’s Corp.		151,109		15,434,273
MGM Resorts International *		52,300		738,476
Monarch Casino & Resort, Inc. *		8,000		102,960
MTR Gaming Group, Inc. *		5,800		20,010
Multimedia Games Holding Co., Inc. *		5,500		135,630
Orient-Express Hotels Ltd., Class A *		12,600		127,260
Panera Bread Co., Class A *		4,200		744,366
Papa John’s International, Inc. *		3,400		214,200
Penn National Gaming, Inc. *		9,800		573,790
Pinnacle Entertainment, Inc. *		6,800		129,608

See financial notes 43

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Regis Corp.		6,900		129,375
Royal Caribbean Cruises Ltd.		21,000		767,130
Ruby Tuesday, Inc. *		13,200		127,248
Scientific Games Corp., Class A *		22,200		197,136
Service Corp. International		30,100		508,088
SHFL Entertainment, Inc. *		8,012		126,590
Six Flags Entertainment Corp.		7,800		568,386
Sonic Corp. *		7,968		99,839
Sotheby’s		9,838		349,052
Speedway Motorsports, Inc.		6,700		120,801
Starbucks Corp.		112,900		6,868,836
Starwood Hotels & Resorts Worldwide, Inc.		29,230		1,885,920
Steiner Leisure Ltd. *		3,000		145,290
Stewart Enterprises, Inc., Class A		10,000		89,100
Strayer Education, Inc. (d)		1,700		80,512
Texas Roadhouse, Inc.		8,300		195,050
The Cheesecake Factory, Inc.		7,087		282,204
The Wendy’s Co.		50,775		288,910
Vail Resorts, Inc.		5,300		319,590
Weight Watchers International, Inc.		3,800		160,246
WMS Industries, Inc. *		8,250		209,385
Wyndham Worldwide Corp.		20,944		1,258,316
Wynn Resorts Ltd.		12,400		1,702,520
Yum! Brands, Inc.		68,400		4,659,408
				58,626,677
Diversified Financials 5.8%
Affiliated Managers Group, Inc. *		7,600		1,183,168
American Express Co.		145,250		9,936,552
Ameriprise Financial, Inc.		30,930		2,305,213
Asset Acceptance Capital Corp. *		2,500		16,175
ASTA Funding, Inc.		6,000		56,340
Atlanticus Holdings Corp. *		4,629		17,127
Bank of America Corp.		1,623,056		19,979,819
BGC Partners, Inc., Class A		28,300		161,876
BlackRock, Inc.		19,000		5,063,500
Calamos Asset Management, Inc., Class A		5,000		56,750
Capital One Financial Corp.		86,810		5,015,882
Cash America International, Inc.		4,100		178,883
CBOE Holdings, Inc.		11,800		442,854
Citigroup, Inc.		458,028		21,371,586
CME Group, Inc.		45,750		2,784,345
Cohen & Steers, Inc.		5,400		213,354
Cowen Group, Inc., Class A *		11,889		30,436
Credit Acceptance Corp. *		1,300		130,429
DFC Global Corp. *		9,750		131,625
Discover Financial Services		75,350		3,295,809
E*TRADE Financial Corp. *		37,533		386,215
Eaton Vance Corp.		16,600		662,008
Encore Capital Group, Inc. *		5,600		159,544
Evercore Partners, Inc., Class A		6,500		245,375
Ezcorp, Inc., Class A *		8,500		143,650
FBR & Co. *		1,000		20,830
Federated Investors, Inc., Class B		14,650		336,364
Financial Engines, Inc.		5,700		207,309
First Cash Financial Services, Inc. *		3,800		195,586
Franklin Resources, Inc.		20,600		3,185,996
GAMCO Investors, Inc., Class A		3,200		168,000
GFI Group, Inc.		18,700		74,987
Greenhill & Co., Inc.		4,500		207,855
HFF, Inc., Class A		5,900		123,605
ICG Group, Inc. *		8,050		95,554
Interactive Brokers Group, Inc., Class A		7,600		114,456
IntercontinentalExchange, Inc. *		10,800		1,759,644
INTL FCStone, Inc. *		4,437		75,961
Invesco Ltd.		64,700		2,053,578
Investment Technology Group, Inc. *		8,050		87,665
Janus Capital Group, Inc.		26,200		233,704
JPMorgan Chase & Co.		576,844		28,271,124
Knight Capital Group, Inc., Class A *		46,600		164,964
Legg Mason, Inc.		19,050		606,933
Leucadia National Corp.		44,250		1,366,882
LPL Financial Holdings, Inc.		7,700		266,112
MarketAxess Holdings, Inc.		5,300		224,296
MicroFinancial, Inc.		1,900		15,371
Moody’s Corp.		28,700		1,746,395
Morgan Stanley		204,400		4,527,460
MSCI, Inc. *		17,000		579,700
Nelnet, Inc., Class A		3,700		125,800
Netspend Holdings, Inc. *		11,800		188,328
NewStar Financial, Inc. *		13,500		161,325
Northern Trust Corp.		31,800		1,714,656
NYSE Euronext		35,400		1,373,874
PHH Corp. *		7,186		151,481
PICO Holdings, Inc. *		3,700		80,290
Piper Jaffray Cos., Inc. *		3,950		133,352
Portfolio Recovery Associates, Inc. *		2,400		294,600
Raymond James Financial, Inc.		15,850		656,507
Resource America, Inc., Class A		4,000		36,880
SEI Investments Co.		19,400		556,004
SLM Corp.		68,300		1,410,395
State Street Corp.		69,383		4,056,824
Stifel Financial Corp. *		8,685		279,831
SWS Group, Inc. *		8,211		46,721
T. Rowe Price Group, Inc.		38,000		2,755,000
TD Ameritrade Holding Corp.		32,300		643,093
The Bank of New York Mellon Corp.		174,334		4,919,705
The Charles Schwab Corp. (b)		163,626		2,775,097
The First Marblehead Corp. *		7,500		9,225
The Goldman Sachs Group, Inc.		65,900		9,626,013
The McGraw-Hill Cos., Inc.		41,100		2,223,921
The NASDAQ OMX Group, Inc.		17,100		504,108
Virtus Investment Partners, Inc. *		875		167,125
Waddell & Reed Financial, Inc., Class A		12,250		525,158
Walter Investment Management Corp. *		5,325		178,707
Westwood Holdings Group, Inc.		4,285		187,255
WisdomTree Investments, Inc. *		12,000		139,200
World Acceptance Corp. *		1,800		159,948
				156,759,269
Energy 9.6%
Abraxas Petroleum Corp. *		36,200		81,088

44 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Adams Resources & Energy, Inc.		2,300		114,287
Alon USA Energy, Inc.		8,700		144,420
Alpha Natural Resources, Inc. *		29,330		217,629
Anadarko Petroleum Corp.		75,860		6,429,894
Apache Corp.		58,872		4,349,463
Apco Oil & Gas International, Inc. *		6,500		65,715
Approach Resources, Inc. *		4,000		94,880
Arch Coal, Inc. (d)		26,500		128,525
Atwood Oceanics, Inc. *		8,000		392,400
Baker Hughes, Inc.		65,550		2,975,315
Basic Energy Services, Inc. *		8,500		116,705
Berry Petroleum Co., Class A		6,600		316,206
Bill Barrett Corp. *		6,700		133,062
Bonanza Creek Energy, Inc. *		3,800		130,530
Bristow Group, Inc.		5,000		316,000
C&J Energy Services, Inc. *		5,500		108,845
Cabot Oil & Gas Corp.		31,000		2,109,550
Cal Dive International, Inc. (d)*		25,200		42,084
Callon Petroleum Co. *		18,200		65,156
Cameron International Corp. *		36,847		2,267,933
CARBO Ceramics, Inc.		2,700		190,755
Carrizo Oil & Gas, Inc. *		5,100		123,522
Cheniere Energy, Inc. *		32,000		911,360
Chesapeake Energy Corp.		81,000		1,582,740
Chevron Corp.		292,839		35,729,286
Cimarex Energy Co.		12,808		937,289
Clayton Williams Energy, Inc. *		2,500		96,500
Clean Energy Fuels Corp. (d)*		9,200		121,348
Cloud Peak Energy, Inc. *		8,700		169,998
Cobalt International Energy, Inc. *		26,500		740,410
Comstock Resources, Inc. *		6,400		100,224
Concho Resources, Inc. *		15,200		1,309,176
ConocoPhillips		184,923		11,178,595
CONSOL Energy, Inc.		34,000		1,143,760
Contango Oil & Gas Co.		2,000		75,240
Continental Resources, Inc. *		8,500		679,320
Crosstex Energy, Inc.		6,200		114,142
CVR Energy, Inc.		2,500		123,175
Delek US Holdings, Inc.		6,300		227,367
Denbury Resources, Inc. *		57,225		1,023,755
Devon Energy Corp.		56,160		3,092,170
Diamond Offshore Drilling, Inc.		9,900		684,090
Dresser-Rand Group, Inc. *		10,600		589,466
Dril-Quip, Inc. *		6,100		510,631
Energen Corp.		10,200		483,684
ENGlobal Corp. *		4,000		1,560
Ensco plc, Class A		34,700		2,001,496
EOG Resources, Inc.		40,600		4,919,096
EPL Oil & Gas, Inc. *		4,900		160,083
EQT Corp.		23,200		1,742,784
Era Group, Inc. *		2,850		65,123
EXCO Resources, Inc.		22,000		159,720
Exterran Holdings, Inc. *		10,720		283,222
Exxon Mobil Corp.		675,334		60,097,973
FMC Technologies, Inc. *		35,164		1,909,405
Forest Oil Corp. *		12,450		52,166
Forum Energy Technologies, Inc. *		6,800		189,108
Geospace Technologies Corp. *		1,800		151,866
Goodrich Petroleum Corp. *		9,800		127,792
Gulf Island Fabrication, Inc.		4,100		84,296
GulfMark Offshore, Inc., Class A		4,100		170,642
Gulfport Energy Corp. *		10,900		568,871
Halcon Resources Corp. (d)*		22,300		145,842
Halliburton Co.		139,600		5,970,692
Harvest Natural Resources, Inc. *		9,300		30,504
Helix Energy Solutions Group, Inc. *		14,064		324,035
Helmerich & Payne, Inc.		15,600		914,472
Hercules Offshore, Inc. *		22,900		168,773
Hess Corp.		45,500		3,284,190
HollyFrontier Corp.		29,854		1,476,280
Hornbeck Offshore Services, Inc. *		5,000		224,600
Houston American Energy Corp. *		4,000		764
ION Geophysical Corp. *		13,900		86,736
James River Coal Co. (d)*		15,700		25,905
Key Energy Services, Inc. *		22,300		132,462
Kinder Morgan, Inc.		96,115		3,758,096
KiOR, Inc., Class A (d)*		15,300		74,511
Kodiak Oil & Gas Corp. *		37,100		290,493
Laredo Petroleum Holdings, Inc. *		11,100		190,920
Lufkin Industries, Inc.		4,700		414,963
Magnum Hunter Resources Corp. (d)*		22,939		62,394
Marathon Oil Corp.		107,908		3,525,354
Marathon Petroleum Corp.		50,204		3,933,985
Matador Resources Co. *		12,100		119,427
Matrix Service Co. *		8,000		120,240
McDermott International, Inc. *		32,400		346,032
McMoRan Exploration Co. *		14,100		233,355
Midstates Petroleum Co, Inc. *		14,400		83,088
Murphy Oil Corp.		27,500		1,707,475
Nabors Industries Ltd.		40,834		603,935
National Oilwell Varco, Inc.		64,722		4,221,169
Natural Gas Services Group, Inc. *		7,500		151,425
Newfield Exploration Co. *		18,800		409,652
Newpark Resources, Inc. *		11,500		120,750
Noble Corp.		37,700		1,413,750
Noble Energy, Inc.		27,518		3,117,514
Northern Oil & Gas, Inc. *		8,200		105,698
Oasis Petroleum, Inc. *		9,900		338,877
Occidental Petroleum Corp.		120,920		10,793,319
Oceaneering International, Inc.		16,000		1,122,720
Oil States International, Inc. *		7,700		688,072
Panhandle Oil & Gas, Inc., Class A		3,100		88,288
Parker Drilling Co. *		18,300		75,396
Patterson-UTI Energy, Inc.		21,500		453,435
PBF Energy, Inc.		3,000		91,350
PDC Energy, Inc. *		4,000		173,200
Peabody Energy Corp.		39,100		784,346
Penn Virginia Corp.		12,200		49,166
PetroQuest Energy, Inc. *		13,200		56,496
PHI, Inc. - Non Voting Shares *		4,000		111,080
Phillips 66		93,361		5,690,353
Pioneer Energy Services Corp. *		13,100		92,355
Pioneer Natural Resources Co.		19,733		2,411,965
Plains Exploration & Production Co. *		18,765		848,178
QEP Resources, Inc.		26,000		746,460
Quicksilver Resources, Inc. (d)*		36,100		90,972
Range Resources Corp.		24,100		1,771,832
Rentech, Inc.		37,400		77,418
Resolute Energy Corp. *		11,900		109,718
REX American Resources Corp. *		4,875		91,114
Rex Energy Corp. *		8,000		128,560

See financial notes 45

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Rosetta Resources, Inc. *		7,500		321,825
Rowan Cos. plc, Class A *		17,500		569,275
RPC, Inc.		9,318		123,370
Sanchez Energy Corp. (d)*		4,500		81,495
SandRidge Energy, Inc. (d)*		49,331		253,561
Schlumberger Ltd.		200,160		14,897,909
SEACOR Holdings, Inc.		2,850		205,514
SemGroup Corp., Class A *		6,000		311,100
SM Energy Co.		9,200		561,200
Solazyme, Inc. (d)*		12,100		110,110
Southwestern Energy Co. *		53,900		2,016,938
Spectra Energy Corp.		99,378		3,133,388
Stone Energy Corp. *		7,383		145,667
Superior Energy Services, Inc. *		22,399		617,988
Swift Energy Co. *		5,500		71,170
Targa Resources Corp.		4,000		263,040
Teekay Corp.		6,000		213,600
Tesco Corp. *		7,000		85,400
Tesoro Corp.		20,500		1,094,700
TETRA Technologies, Inc. *		12,100		110,473
The Williams Cos., Inc.		103,660		3,952,556
Tidewater, Inc.		7,700		403,865
Transocean Ltd. *		53,600		2,758,792
Ultra Petroleum Corp. *		21,500		460,100
Unit Corp. *		7,400		311,022
USEC, Inc. (d)*		68,600		21,952
VAALCO Energy, Inc. *		12,600		84,672
Valero Energy Corp.		84,480		3,406,234
Verenium Corp. (d)*		91		209
W&T Offshore, Inc.		7,500		87,600
Warren Resources, Inc. *		22,100		58,123
Weatherford International Ltd. *		112,400		1,437,596
Western Refining, Inc.		7,700		238,007
Westmoreland Coal Co. *		9,600		115,872
Whiting Petroleum Corp. *		17,400		774,300
World Fuel Services Corp.		10,200		413,610
WPX Energy, Inc. *		28,053		438,468
				260,047,745
Food & Staples Retailing 2.0%
Arden Group, Inc., Class A		600		59,340
Casey’s General Stores, Inc.		5,100		295,341
Costco Wholesale Corp.		65,700		7,123,851
CVS Caremark Corp.		185,990		10,820,898
Harris Teeter Supermarkets, Inc.		7,200		300,888
Ingles Markets, Inc., Class A		3,900		83,148
Nash Finch Co.		3,200		65,760
PriceSmart, Inc.		3,500		312,305
Rite Aid Corp. *		105,600		279,840
Safeway, Inc.		37,500		844,500
Spartan Stores, Inc.		2,400		40,272
SUPERVALU, Inc.		24,332		142,099
Susser Holdings Corp. *		2,500		132,925
Sysco Corp.		87,736		3,058,477
The Andersons, Inc.		2,400		130,848
The Fresh Market, Inc. *		5,800		237,394
The Kroger Co.		76,700		2,636,946
The Pantry, Inc. *		6,000		87,660
United Natural Foods, Inc. *		6,800		339,592
Wal-Mart Stores, Inc.		252,100		19,593,212
Walgreen Co.		129,600		6,416,496
Weis Markets, Inc.		2,400		100,392
Whole Foods Market, Inc.		25,700		2,269,824
				55,372,008
Food, Beverage & Tobacco 5.3%
Alico, Inc.		2,000		83,620
Alliance One International, Inc. *		24,600		92,250
Altria Group, Inc.		302,100		11,029,671
Annie’s, Inc. *		1,800		68,022
Archer-Daniels-Midland Co.		98,258		3,334,877
B&G Foods, Inc.		7,400		228,364
Beam, Inc.		23,500		1,520,685
Boulder Brands, Inc. *		9,100		81,991
Brown-Forman Corp., Class B		23,435		1,652,167
Bunge Ltd.		21,300		1,538,073
Campbell Soup Co.		26,400		1,225,224
Chiquita Brands International, Inc. *		13,900		119,957
Coca-Cola Bottling Co. Consolidated		1,300		79,950
Coca-Cola Enterprises, Inc.		41,000		1,501,830
ConAgra Foods, Inc.		63,593		2,249,284
Constellation Brands, Inc., Class A *		22,100		1,090,635
Darling International, Inc. *		15,500		286,905
Dean Foods Co. *		27,113		518,943
Diamond Foods, Inc. *		5,200		78,416
Dole Food Co., Inc. *		8,300		89,308
Dr Pepper Snapple Group, Inc.		30,800		1,503,964
Farmer Brothers Co. *		4,500		68,175
Flowers Foods, Inc.		17,737		584,257
Fresh Del Monte Produce, Inc.		4,200		106,722
General Mills, Inc.		97,500		4,915,950
Green Mountain Coffee Roasters, Inc. (d)*		18,350		1,053,290
Griffin Land & Nurseries, Inc.		300		8,955
H.J. Heinz Co.		47,800		3,461,676
Hillshire Brands Co.		17,000		610,470
Hormel Foods Corp.		21,400		883,178
Ingredion, Inc.		11,800		849,718
J&J Snack Foods Corp.		2,093		157,017
John B. Sanfilippo & Son, Inc.		5,000		104,900
Kellogg Co.		36,900		2,399,976
Kraft Foods Group, Inc.		89,604		4,613,710
Lancaster Colony Corp.		3,400		268,362
Limoneira Co.		2,900		54,027
Lorillard, Inc.		57,944		2,485,218
McCormick & Co., Inc. - Non Voting Shares		19,600		1,410,024
Mead Johnson Nutrition Co.		30,000		2,432,700
Molson Coors Brewing Co., Class B		23,000		1,186,800
Mondelez International, Inc., Class A		268,313		8,438,444
Monster Beverage Corp. *		21,600		1,218,240
National Beverage Corp.		6,400		94,272
PepsiCo, Inc.		232,558		19,179,058
Philip Morris International, Inc.		248,400		23,744,556
Pilgrim’s Pride Corp. *		12,466		122,042
Post Holdings, Inc. *		4,650		203,624
Primo Water Corp. *		1,000		1,270

46 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Reynolds American, Inc.		48,328		2,291,714
Rocky Mountain Chocolate Factory, Inc.		3,427		41,878
Sanderson Farms, Inc.		2,850		174,591
Seaboard Corp.		100		274,598
Smithfield Foods, Inc. *		19,800		506,880
Snyders-Lance, Inc.		8,900		224,102
The Boston Beer Co., Inc., Class A *		1,200		203,184
The Coca-Cola Co.		577,900		24,462,507
The Hain Celestial Group, Inc. *		6,306		411,466
The Hershey Co.		23,200		2,068,512
The JM Smucker Co.		15,846		1,635,783
Tootsie Roll Industries, Inc. (d)		4,070		127,106
TreeHouse Foods, Inc. *		4,922		313,581
Tyson Foods, Inc., Class A		41,840		1,030,519
Universal Corp.		4,800		276,240
Vector Group Ltd.		7,900		128,849
				143,202,277
Health Care Equipment & Services 4.3%
Abaxis, Inc.		2,800		119,532
Abbott Laboratories		235,805		8,705,921
ABIOMED, Inc. *		7,800		144,066
Acadia Healthcare Co., Inc. *		4,000		126,200
Accretive Health, Inc. *		17,700		186,558
Accuray, Inc. (d)*		21,200		93,280
Aetna, Inc.		49,900		2,866,256
Air Methods Corp.		4,500		164,655
Alere, Inc. *		12,441		319,485
Align Technology, Inc. *		10,100		334,512
Alliance HealthCare Services, Inc. *		360		4,590
Allscripts Healthcare Solutions, Inc. *		23,460		324,686
Amedisys, Inc. *		10,834		108,773
AmerisourceBergen Corp.		35,796		1,937,280
AMN Healthcare Services, Inc. *		10,010		137,437
AmSurg Corp. *		4,300		144,308
Analogic Corp.		1,400		111,272
Antares Pharma, Inc. (d)*		28,100		106,499
ArthroCare Corp. *		3,000		103,950
Assisted Living Concepts, Inc., Class A		7,100		84,632
athenahealth, Inc. *		5,200		500,552
Baxter International, Inc.		81,918		5,723,611
Becton, Dickinson & Co.		29,400		2,772,420
Bio-Reference Laboratories, Inc. (d)*		3,500		89,250
BioScrip, Inc. *		8,372		116,036
Boston Scientific Corp. *		201,068		1,505,999
Brookdale Senior Living, Inc. *		14,300		368,797
C.R. Bard, Inc.		11,700		1,162,512
Cantel Medical Corp.		5,356		169,303
Cardinal Health, Inc.		50,660		2,240,185
CareFusion Corp. *		32,780		1,096,163
Centene Corp. *		7,000		323,400
Cerner Corp. *		21,600		2,090,232
Chemed Corp.		3,900		318,318
Chindex International, Inc. *		6,100		83,570
Cigna Corp.		42,300		2,798,991
Community Health Systems, Inc.		13,500		615,195
Computer Programs & Systems, Inc.		1,900		99,674
Conceptus, Inc. *		8,400		260,484
CONMED Corp.		4,200		131,586
CorVel Corp. *		2,850		135,290
Coventry Health Care, Inc.		19,937		987,878
Covidien plc		71,600		4,570,944
Cross Country Healthcare, Inc. *		12,500		62,500
CryoLife, Inc.		9,050		54,300
Cyberonics, Inc. *		4,200		182,364
DaVita HealthCare Partners, Inc. *		12,350		1,465,327
DENTSPLY International, Inc.		21,000		889,350
DexCom, Inc. *		8,600		141,126
Edwards Lifesciences Corp. *		17,100		1,090,809
Emeritus Corp. *		5,400		138,780
Endologix, Inc. *		7,600		114,152
ExamWorks Group, Inc. *		6,200		112,220
Express Scripts Holding Co. *		123,663		7,341,872
Five Star Quality Care, Inc. *		14,335		67,805
Gentiva Health Services, Inc. *		9,150		95,984
Globus Medical, Inc., Class A (d)*		7,900		120,238
Greatbatch, Inc. *		4,100		114,554
Greenway Medical Technologies (d)*		5,800		78,126
Haemonetics Corp. *		7,400		284,900
Hanger, Inc. *		5,400		164,106
HCA Holdings, Inc.		36,200		1,444,018
Health Management Associates, Inc., Class A *		37,400		429,726
Health Net, Inc. *		11,100		326,340
HealthSouth Corp. *		13,500		371,250
HealthStream, Inc. *		3,500		80,360
Healthways, Inc. *		8,100		112,509
Henry Schein, Inc. *		13,100		1,184,240
Hill-Rom Holdings, Inc.		7,800		265,746
HMS Holdings Corp. *		12,200		307,562
Hologic, Inc. *		38,912		792,637
Humana, Inc.		23,400		1,734,174
ICU Medical, Inc. *		1,750		105,438
IDEXX Laboratories, Inc. *		8,000		703,680
Insulet Corp. *		6,800		171,632
Integra LifeSciences Holdings Corp. *		3,100		108,593
Intuitive Surgical, Inc. *		5,950		2,929,125
Invacare Corp.		6,000		80,700
IPC The Hospitalist Co., Inc. *		2,000		91,240
Kindred Healthcare, Inc. *		9,208		96,592
Laboratory Corp. of America Holdings *		13,700		1,279,032
Landauer, Inc.		2,100		117,327
LCA-Vision, Inc. *		2,500		8,500
LeMaitre Vascular, Inc.		6,800		41,208
LifePoint Hospitals, Inc. *		6,707		321,936
Magellan Health Services, Inc. *		3,907		199,882
MAKO Surgical Corp. (d)*		7,800		82,602
Masimo Corp.		8,500		170,510
McKesson Corp.		34,900		3,693,118
MedAssets, Inc. *		6,000		112,380
Medical Action Industries, Inc. *		6,250		50,813
Medidata Solutions, Inc. *		3,400		225,624
MEDNAX, Inc. *		7,200		638,856

See financial notes 47

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Medtronic, Inc.		153,074		7,145,494
Meridian Bioscience, Inc.		5,850		118,697
Merit Medical Systems, Inc. *		10,277		99,379
Molina Healthcare, Inc. *		3,750		124,500
MWI Veterinary Supply, Inc. *		1,700		200,107
National Healthcare Corp.		2,100		97,503
Natus Medical, Inc. *		7,600		95,076
Neogen Corp. *		3,105		157,827
NuVasive, Inc. *		10,000		209,700
NxStage Medical, Inc. *		8,400		93,828
Omnicare, Inc.		16,100		704,697
Omnicell, Inc. *		7,400		133,348
OraSure Technologies, Inc. *		12,200		54,412
Orthofix International N.V. *		2,800		90,720
Owens & Minor, Inc.		9,100		296,387
Patterson Cos., Inc.		13,100		497,145
PDI, Inc. *		2,900		13,253
PharMerica Corp. *		5,913		76,219
Quality Systems, Inc.		5,700		101,859
Quest Diagnostics, Inc.		23,520		1,324,882
Quidel Corp. *		5,200		116,064
ResMed, Inc. (d)		21,200		1,018,024
RTI Biologics, Inc. *		18,100		72,038
Select Medical Holdings Corp.		22,600		186,450
Sirona Dental Systems, Inc. *		9,200		676,568
Spectranetics Corp. *		6,700		124,955
St. Jude Medical, Inc.		42,200		1,739,484
STERIS Corp.		8,200		341,038
Stryker Corp.		43,100		2,826,498
SurModics, Inc. *		4,200		111,090
Symmetry Medical, Inc. *		8,200		97,744
Team Health Holdings, Inc. *		5,500		205,040
Teleflex, Inc.		5,900		460,967
Tenet Healthcare Corp. *		15,512		703,624
The Cooper Cos., Inc.		6,981		770,702
The Ensign Group, Inc.		3,000		104,610
The Providence Service Corp. *		4,800		84,048
Thoratec Corp. *		8,636		312,623
Triple-S Management Corp., Class B *		5,300		95,559
U.S. Physical Therapy, Inc.		3,500		83,510
Unilife Corp. (d)*		29,100		57,618
UnitedHealth Group, Inc.		154,480		9,257,986
Universal American Corp.		20,600		176,130
Universal Health Services, Inc., Class B		12,900		859,011
Utah Medical Products, Inc.		2,500		110,825
Vanguard Health Systems, Inc. *		10,500		153,615
Varian Medical Systems, Inc. *		15,800		1,029,212
VCA Antech, Inc. *		12,400		298,840
Vocera Communications, Inc. *		3,700		73,260
Volcano Corp. *		7,500		152,175
WellCare Health Plans, Inc. *		6,200		361,522
WellPoint, Inc.		45,323		3,304,953
West Pharmaceutical Services, Inc.		4,600		293,756
Wright Medical Group, Inc. *		8,600		201,584
Zimmer Holdings, Inc.		25,900		1,980,055
				115,156,356
Household & Personal Products 2.1%
Avon Products, Inc.		64,500		1,493,820
Central Garden & Pet Co., Class A *		8,600		75,680
Church & Dwight Co., Inc.		20,400		1,303,356
Colgate-Palmolive Co.		66,300		7,916,883
Elizabeth Arden, Inc. *		3,500		143,325
Energizer Holdings, Inc.		9,333		901,474
Harbinger Group, Inc. *		19,100		172,664
Herbalife Ltd. (d)		15,600		619,476
Inter Parfums, Inc.		5,613		162,609
Kimberly-Clark Corp.		58,339		6,020,001
Medifast, Inc. *		3,500		91,700
Nu Skin Enterprises, Inc., Class A		8,300		421,059
Nutraceutical International Corp.		5,000		92,350
Oil-Dri Corp. of America		1,600		44,016
Orchids Paper Products Co.		2,500		57,500
Prestige Brands Holdings, Inc. *		6,500		175,175
Revlon, Inc., Class A *		5,400		104,490
Spectrum Brands Holdings, Inc.		3,500		196,000
The Clorox Co.		19,300		1,664,625
The Estee Lauder Cos., Inc., Class A		35,800		2,482,730
The Female Health Co.		7,500		57,525
The Procter & Gamble Co.		411,715		31,607,361
WD-40 Co.		1,600		86,288
				55,890,107
Insurance 4.2%
ACE Ltd.		51,500		4,590,710
Aflac, Inc.		71,500		3,892,460
Alleghany Corp. *		2,440		960,726
Allied World Assurance Co. Holdings AG		4,900		444,969
American Equity Investment Life Holding Co.		6,400		97,536
American Financial Group, Inc.		10,750		518,903
American International Group, Inc. *		222,896		9,232,352
American National Insurance Co.		1,300		122,239
American Safety Insurance Holdings Ltd. *		3,000		72,240
AMERISAFE, Inc.		4,000		130,640
AmTrust Financial Services, Inc. (d)		3,750		118,725
Aon plc		47,096		2,842,244
Arch Capital Group Ltd. *		20,700		1,098,342
Argo Group International Holdings Ltd.		4,556		188,846
Arthur J. Gallagher & Co.		18,400		781,080
Aspen Insurance Holdings Ltd.		10,400		397,176
Assurant, Inc.		13,500		641,790
Assured Guaranty Ltd.		27,300		563,199
Axis Capital Holdings Ltd.		18,200		812,266
Baldwin & Lyons, Inc., Class B		1,950		47,385
Berkshire Hathaway, Inc., Class B *		274,874		29,224,604
Brown & Brown, Inc.		16,200		502,038
Cincinnati Financial Corp.		21,150		1,034,447
Citizens, Inc. *		16,000		104,640
CNA Financial Corp.		3,800		128,098
CNO Financial Group, Inc.		30,900		349,788
Crawford & Co., Class B		5,800		44,022
Eastern Insurance Holdings, Inc.		2,500		46,575

48 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
EMC Insurance Group, Inc.		1,200		33,876
Employers Holdings, Inc.		4,200		95,130
Endurance Specialty Holdings Ltd.		6,200		303,614
Enstar Group Ltd. *		1,300		165,217
Erie Indemnity Co., Class A		3,600		286,452
Everest Re Group Ltd.		7,700		1,039,423
FBL Financial Group, Inc., Class A		2,890		113,606
Federated National Holding Co.		1,500		10,830
Fidelity National Financial, Inc., Class A		30,927		830,390
First American Financial Corp.		16,800		449,736
Genworth Financial, Inc., Class A *		70,200		704,106
Greenlight Capital Re Ltd., Class A *		4,300		105,823
Hartford Financial Services Group, Inc.		67,400		1,893,266
HCC Insurance Holdings, Inc.		15,150		645,390
Hilltop Holdings, Inc. *		12,926		173,079
Horace Mann Educators Corp.		4,300		96,965
Independence Holding Co.		2,970		31,185
Infinity Property & Casualty Corp.		2,500		141,850
Kemper Corp.		7,700		245,322
Lincoln National Corp.		39,926		1,357,883
Loews Corp.		46,345		2,070,231
Maiden Holdings Ltd.		9,800		101,234
Markel Corp. *		1,950		1,045,687
Marsh & McLennan Cos., Inc.		83,900		3,189,039
MBIA, Inc. *		25,250		238,865
Mercury General Corp.		5,400		246,834
MetLife, Inc.		165,700		6,460,643
Montpelier Re Holdings Ltd.		8,100		208,656
National Financial Partners Corp. *		9,600		243,264
National Western Life Insurance Co., Class A		1,100		200,882
Old Republic International Corp.		34,422		464,697
OneBeacon Insurance Group Ltd., Class A		8,200		111,438
PartnerRe Ltd.		8,900		839,626
Platinum Underwriters Holdings Ltd.		4,500		255,375
Primerica, Inc.		7,500		254,700
Principal Financial Group, Inc.		40,800		1,472,880
ProAssurance Corp.		8,540		418,375
Protective Life Corp.		10,500		399,630
Prudential Financial, Inc.		70,400		4,253,568
Reinsurance Group of America, Inc.		10,900		681,795
RenaissanceRe Holdings Ltd.		7,200		676,008
RLI Corp.		2,800		201,180
Safety Insurance Group, Inc.		3,400		168,878
Selective Insurance Group, Inc.		7,800		182,754
StanCorp Financial Group, Inc.		6,300		272,034
State Auto Financial Corp.		5,500		95,590
Stewart Information Services Corp.		3,600		97,452
Symetra Financial Corp.		11,500		156,745
The Allstate Corp.		71,274		3,510,957
The Chubb Corp.		38,794		3,416,588
The Hanover Insurance Group, Inc.		6,900		347,967
The Navigators Group, Inc. *		1,500		86,820
The Phoenix Cos., Inc. *		475		13,827
The Progressive Corp.		82,300		2,081,367
The Travelers Cos., Inc.		56,450		4,821,394
Torchmark Corp.		13,400		831,738
Tower Group International Ltd.		6,344		120,028
United Fire Group, Inc.		5,000		139,800
Unum Group		39,814		1,110,412
Validus Holdings Ltd.		16,857		650,849
W. R. Berkley Corp.		15,850		688,207
White Mountains Insurance Group Ltd.		900		520,479
XL Group plc		43,400		1,351,476
				112,411,152
Materials 3.7%
A. Schulman, Inc.		5,300		137,641
A.M. Castle & Co. (d)*		5,800		100,456
AEP Industries, Inc. *		1,900		146,490
Air Products & Chemicals, Inc.		31,500		2,739,240
Airgas, Inc.		10,200		985,830
AK Steel Holding Corp. (d)		32,127		107,625
Albemarle Corp.		13,300		814,625
Alcoa, Inc.		157,864		1,341,844
Allegheny Technologies, Inc.		15,892		428,766
Allied Nevada Gold Corp. *		11,500		123,050
AMCOL International Corp.		3,000		92,310
American Vanguard Corp.		3,000		86,520
AptarGroup, Inc.		9,500		532,950
Ashland, Inc.		10,823		922,228
Axiall Corp.		10,400		545,480
Balchem Corp.		4,200		182,028
Ball Corp.		22,400		988,288
Bemis Co., Inc.		14,700		578,445
Berry Plastics Group, Inc. *		7,600		144,400
Boise, Inc.		13,500		107,865
Buckeye Technologies, Inc.		7,700		289,443
Cabot Corp.		8,400		315,504
Calgon Carbon Corp. *		7,000		119,280
Carpenter Technology Corp.		6,200		278,752
Celanese Corp., Series A		23,800		1,175,958
Century Aluminum Co. *		20,800		169,728
CF Industries Holdings, Inc.		9,200		1,715,892
Chase Corp.		200		3,880
Chemtura Corp. *		14,000		297,640
Clearwater Paper Corp. *		3,272		150,577
Cliffs Natural Resources, Inc. (d)		21,100		450,274
Coeur d’Alene Mines Corp. *		12,800		195,072
Commercial Metals Co.		15,000		219,300
Compass Minerals International, Inc.		5,000		432,700
Crown Holdings, Inc. *		21,300		909,084
Cytec Industries, Inc.		6,600		480,876
Deltic Timber Corp.		1,500		93,720
Domtar Corp.		5,250		364,928
E.I. du Pont de Nemours & Co.		141,195		7,696,539
Eagle Materials, Inc.		6,543		443,288
Eastman Chemical Co.		23,880		1,591,602
Ecolab, Inc.		40,304		3,410,524
Ferro Corp. *		21,000		147,840
Flotek Industries, Inc. *		8,000		128,320
FMC Corp.		20,000		1,214,000
Freeport-McMoRan Copper & Gold, Inc.		144,044		4,383,259
FutureFuel Corp.		8,300		101,675

See financial notes 49

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
General Moly, Inc. *		15,700		29,202
Globe Specialty Metals, Inc.		9,100		118,846
Graphic Packaging Holding Co. *		31,900		239,888
Greif, Inc., Class A		4,300		207,131
H.B. Fuller Co.		6,500		246,350
Hawkins, Inc.		2,700		100,413
Haynes International, Inc.		2,500		121,525
Headwaters, Inc. *		12,000		130,320
Hecla Mining Co.		40,200		136,680
Horsehead Holding Corp. *		12,800		136,960
Huntsman Corp.		27,400		516,764
Innophos Holdings, Inc.		3,100		159,061
International Flavors & Fragrances, Inc.		12,200		941,718
International Paper Co.		65,504		3,077,378
Intrepid Potash, Inc.		6,500		119,665
Kaiser Aluminum Corp.		2,000		126,000
KapStone Paper & Packaging Corp.		5,400		159,732
KMG Chemicals, Inc.		1,600		29,376
Koppers Holdings, Inc.		2,500		109,775
Kraton Performance Polymers, Inc. *		3,500		79,485
Kronos Worldwide, Inc. (d)		5,320		94,058
Landec Corp. *		9,100		122,031
Louisiana-Pacific Corp. *		20,200		366,024
LSB Industries, Inc. *		3,000		97,980
LyondellBasell Industries N.V., Class A		58,000		3,520,600
Martin Marietta Materials, Inc.		6,500		656,435
Materion Corp.		4,000		105,960
McEwen Mining, Inc. *		31,130		72,533
MeadWestvaco Corp.		25,874		892,136
Minerals Technologies, Inc.		6,200		251,906
Mod-Pac Corp. *		500		4,175
Molycorp, Inc. (d)*		14,100		82,344
Monsanto Co.		80,790		8,629,988
Myers Industries, Inc.		8,080		119,746
Neenah Paper, Inc.		4,231		121,684
NewMarket Corp.		1,500		403,050
Newmont Mining Corp.		73,451		2,379,812
Noranda Aluminum Holding Corp.		16,500		62,865
Nucor Corp.		47,400		2,067,588
Olin Corp.		10,320		249,434
Olympic Steel, Inc.		1,400		28,000
OM Group, Inc. *		4,400		107,668
Omnova Solutions, Inc. *		10,400		69,368
Owens-Illinois, Inc. *		23,200		609,696
P.H. Glatfelter Co.		7,000		168,000
Packaging Corp. of America		14,000		665,840
Penford Corp. *		6,200		68,200
PolyOne Corp.		18,810		423,789
PPG Industries, Inc.		22,400		3,295,936
Praxair, Inc.		45,000		5,143,500
Quaker Chemical Corp.		1,800		111,096
Reliance Steel & Aluminum Co.		11,200		728,784
Resolute Forest Products *		14,000		204,820
Rock-Tenn Co., Class A		11,313		1,132,884
Rockwood Holdings, Inc.		12,500		811,125
Royal Gold, Inc.		9,200		511,336
RPM International, Inc.		18,600		602,640
RTI International Metals, Inc. *		4,500		130,590
Schnitzer Steel Industries, Inc., Class A		3,450		84,629
Schweitzer-Mauduit International, Inc.		6,600		265,914
Sealed Air Corp.		27,800		614,936
Sensient Technologies Corp.		7,400		291,190
Sigma-Aldrich Corp.		17,500		1,377,075
Silgan Holdings, Inc.		6,900		330,303
Sonoco Products Co.		14,900		522,096
Steel Dynamics, Inc.		30,900		464,736
Stepan Co.		2,400		136,656
Stillwater Mining Co. *		14,733		183,279
SunCoke Energy, Inc. *		9,017		136,427
Texas Industries, Inc. *		4,000		254,720
The Dow Chemical Co.		182,266		6,180,640
The Mosaic Co.		41,300		2,543,667
The Scotts Miracle-Gro Co., Class A		5,600		253,960
The Sherwin-Williams Co.		12,800		2,343,808
The Valspar Corp.		12,300		784,986
Tredegar Corp.		5,100		150,960
Tronox Ltd., Class A		5,200		106,808
United States Steel Corp. (d)		20,400		363,120
Universal Stainless & Alloy Products, Inc. *		1,800		62,928
US Silica Holdings, Inc. (d)		5,900		120,537
Valhi, Inc.		7,200		117,648
Vulcan Materials Co.		19,592		977,249
W.R. Grace & Co. *		10,600		817,366
Walter Energy, Inc.		8,900		159,488
Wausau Paper Corp.		8,700		88,566
Westlake Chemical Corp.		2,800		232,792
Worthington Industries, Inc.		7,200		231,696
Zep, Inc.		6,600		100,320
				100,084,126
Media 3.4%
AH Belo Corp., Class A		13,980		81,084
AMC Networks, Inc., Class A *		8,400		529,284
Arbitron, Inc.		3,720		173,687
Belo Corp., Class A		13,100		140,432
Cablevision Systems Corp., Class A		33,200		493,352
Carmike Cinemas, Inc. *		6,300		110,628
CBS Corp., Class B - Non Voting Shares		87,406		4,001,447
Central European Media Enterprises Ltd., Class A (d)*		9,900		36,630
Charter Communications, Inc., Class A *		12,500		1,259,250
Cinemark Holdings, Inc.		14,500		447,905
Clear Channel Outdoor Holdings, Inc., Class A *		20,700		149,661
Comcast Corp., Class A		398,904		16,474,735
Crown Media Holdings, Inc., Class A (d)*		6,000		12,300
Cumulus Media, Inc., Class A *		25,351		80,870
Digital Generation, Inc. (d)*		8,300		55,610
DIRECTV *		85,526		4,837,350
Discovery Communications, Inc., Class A *		36,961		2,913,266

50 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
DISH Network Corp., Class A		33,200		1,301,108
DreamWorks Animation SKG, Inc., Class A *		10,200		196,656
Entercom Communications Corp., Class A *		11,000		87,010
Gannett Co., Inc.		33,500		675,360
Harte-Hanks, Inc.		17,200		136,396
John Wiley & Sons, Inc., Class A		6,300		240,471
Journal Communications, Inc., Class A *		16,900		115,089
Lamar Advertising Co., Class A *		9,200		430,744
Liberty Global, Inc., Class A *		36,575		2,646,933
Liberty Media Corp. *		16,695		1,917,922
Live Nation Entertainment, Inc. *		19,957		252,057
Loral Space & Communications, Inc.		1,500		92,280
Martha Stewart Living Omnimedia, Inc., Class A *		26,100		64,467
Media General, Inc., Class A *		18,800		154,160
Meredith Corp. (d)		5,100		197,982
Morningstar, Inc.		3,200		211,232
National CineMedia, Inc.		7,900		128,296
News Corp., Class A		300,850		9,317,324
Omnicom Group, Inc.		39,100		2,337,007
Pandora Media, Inc. (d)*		13,400		186,662
Regal Entertainment Group, Class A (d)		12,100		217,074
Salem Communications Corp., Class A		5,700		52,326
Scholastic Corp.		3,700		101,565
Scripps Networks Interactive, Class A		12,500		832,250
Shutterstock, Inc. *		2,300		95,910
Sinclair Broadcast Group, Inc., Class A		7,300		195,640
Sirius XM Radio, Inc.		485,300		1,577,225
Starz - Liberty Capital *		16,195		378,639
The E.W. Scripps Co., Class A *		9,800		136,122
The Interpublic Group of Cos., Inc.		64,337		890,424
The Madison Square Garden Co., Class A *		8,475		510,788
The New York Times Co., Class A *		17,300		153,278
The Walt Disney Co.		272,093		17,098,324
The Washington Post Co., Class B		600		266,004
Time Warner Cable, Inc.		44,611		4,188,527
Time Warner, Inc.		141,250		8,443,925
Valassis Communications, Inc.		5,700		146,091
Viacom Inc., Class B		68,306		4,370,901
World Wrestling Entertainment, Inc., Class A		17,100		156,978
				92,298,638
Pharmaceuticals, Biotechnology & Life Sciences 7.8%
AbbVie, Inc.		238,205		10,969,340
Acorda Therapeutics, Inc. *		5,000		197,850
Actavis, Inc. *		18,932		2,001,680
Acura Pharmaceuticals, Inc. (d)*		20,900		51,205
Affymax, Inc. (d)*		4,900		4,411
Affymetrix, Inc. *		25,500		92,820
Agilent Technologies, Inc.		52,017		2,155,585
Akorn, Inc. *		8,000		120,400
Albany Molecular Research, Inc. *		8,800		104,984
Alexion Pharmaceuticals, Inc. *		29,500		2,891,000
Alkermes plc *		20,300		621,383
Allergan, Inc.		46,768		5,310,507
Alnylam Pharmaceuticals, Inc. *		7,400		177,230
AMAG Pharmaceuticals, Inc. *		6,600		145,530
Amgen, Inc.		112,768		11,751,553
Amicus Therapeutics, Inc. *		13,800		44,850
Arena Pharmaceuticals, Inc. (d)*		32,100		264,504
ARIAD Pharmaceuticals, Inc. *		28,700		512,869
ArQule, Inc. *		21,000		61,950
Array BioPharma, Inc. *		24,800		147,560
Astex Pharmaceuticals *		25,900		178,192
Auxilium Pharmaceuticals, Inc. *		7,000		104,510
AVANIR Pharmaceuticals, Inc., Class A *		28,700		91,553
AVEO Pharmaceuticals, Inc. *		15,100		77,161
Bio-Rad Laboratories, Inc., Class A *		3,000		359,250
BioCryst Pharmaceuticals, Inc. (d)*		23,900		48,039
Biogen Idec, Inc. *		35,425		7,755,595
BioMarin Pharmaceutical, Inc. *		20,200		1,325,120
Biota Pharmaceuticals, Inc.		1,716		7,224
Bristol-Myers Squibb Co.		246,250		9,781,050
Bruker Corp. *		14,600		259,442
Cambrex Corp. *		7,200		89,928
Celgene Corp. *		63,145		7,455,530
Celldex Therapeutics, Inc. *		15,200		198,360
Cepheid, Inc. *		9,800		373,674
Charles River Laboratories International, Inc. *		7,416		322,522
Clovis Oncology, Inc. (d)*		6,100		228,262
Codexis, Inc. *		1,870		4,189
Covance, Inc. *		8,800		656,128
Cubist Pharmaceuticals, Inc. *		8,900		408,688
Dendreon Corp. (d)*		23,500		110,685
DepoMed, Inc. *		13,800		76,038
Durect Corp. *		14,500		22,765
Dyax Corp. *		31,000		85,250
Dynavax Technologies Corp. *		30,500		71,675
Eli Lilly & Co.		150,800		8,351,304
Emergent Biosolutions, Inc. *		6,000		92,040
Endo Health Solutions, Inc. *		16,000		586,240
Endocyte, Inc. *		11,300		156,957
Enzo Biochem, Inc. *		9,281		20,790
Enzon Pharmaceuticals, Inc.		21,300		70,290
Exact Sciences Corp. *		8,300		77,522
Exelixis, Inc. (d)*		25,800		133,902
Fluidigm Corp. *		6,000		101,040
Forest Laboratories, Inc. *		34,100		1,275,681
FRD Acquisition Co. (a)(c)*		8,700		—
Furiex Pharmaceuticals, Inc. *		3,400		115,430
Genomic Health, Inc. *		5,000		151,800
Geron Corp. *		46,200		54,054
Gilead Sciences, Inc. *		229,980		11,646,187
GTx, Inc. *		15,900		73,458
Halozyme Therapeutics, Inc. *		17,000		102,680
Harvard Bioscience, Inc. *		19,300		98,816
Hi-Tech Pharmacal Co., Inc.		3,000		99,180
Hospira, Inc. *		24,670		817,070
Idenix Pharmaceuticals, Inc. *		28,800		106,560

See financial notes 51

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Illumina, Inc. *		18,000		1,164,420
ImmunoGen, Inc. *		10,000		160,200
Immunomedics, Inc. *		25,800		66,048
Impax Laboratories, Inc. *		8,500		148,750
Incyte Corp. (d)*		18,400		407,560
Infinity Pharmaceuticals, Inc. *		6,800		293,012
InterMune, Inc. *		12,600		117,558
Ironwood Pharmaceuticals, Inc. *		11,200		170,352
Isis Pharmaceuticals, Inc. *		14,200		317,938
Jazz Pharmaceuticals plc *		6,600		385,110
Johnson & Johnson		421,270		35,904,842
Lexicon Pharmaceuticals, Inc. *		69,600		137,808
Life Technologies Corp. *		26,462		1,949,985
Ligand Pharmaceuticals, Inc., Class B *		4,948		135,179
Luminex Corp. *		7,800		129,714
MannKind Corp. (d)*		40,800		161,160
Maxygen, Inc.		10,000		24,000
Medivation, Inc. *		10,800		569,268
Merck & Co., Inc.		455,570		21,411,790
Merrimack Pharmaceuticals, Inc. *		15,700		77,244
Mettler-Toledo International, Inc. *		4,800		1,003,008
Momenta Pharmaceuticals, Inc. *		7,000		86,240
Mylan, Inc. *		60,800		1,769,888
Myriad Genetics, Inc. *		14,800		412,180
Nektar Therapeutics *		13,300		144,172
Neurocrine Biosciences, Inc. *		10,900		125,786
Novavax, Inc. *		52,500		123,375
NPS Pharmaceuticals, Inc. *		12,300		165,189
Oncothyreon, Inc. (d)*		25,700		64,507
Onyx Pharmaceuticals, Inc. *		10,700		1,014,360
Opko Health, Inc. (d)*		19,000		126,540
Optimer Pharmaceuticals, Inc. *		13,900		214,616
Pacira Pharmaceuticals, Inc. *		6,500		187,655
Pain Therapeutics, Inc. *		18,600		76,632
PAREXEL International Corp. *		7,800		319,410
PDL Biopharma, Inc. (d)		16,000		123,840
PerkinElmer, Inc.		16,077		492,760
Perrigo Co.		12,900		1,540,389
Pfizer, Inc.		1,083,501		31,497,374
Pharmacyclics, Inc. *		7,500		611,250
Pozen, Inc. *		16,100		79,373
Questcor Pharmaceuticals, Inc. (d)		8,000		245,920
Regeneron Pharmaceuticals, Inc. *		11,800		2,538,652
Rigel Pharmaceuticals, Inc. *		14,200		68,018
Sagent Pharmaceuticals, Inc. *		5,500		90,970
Salix Pharmaceuticals Ltd. *		7,000		366,030
Sangamo BioSciences, Inc. (d)*		14,600		148,628
Santarus, Inc. *		10,500		192,885
Sarepta Therapeutics, Inc. (d)*		4,500		130,680
Savient Pharmaceuticals, Inc. (d)*		6,800		5,075
Seattle Genetics, Inc. *		14,700		543,165
Sequenom, Inc. (d)*		23,200		87,464
Spectrum Pharmaceuticals, Inc. (d)		9,000		66,690
Sucampo Pharmaceuticals, Inc., Class A *		12,400		117,924
Synageva BioPharma Corp. *		2,100		108,549
Synta Pharmaceuticals Corp. *		12,000		123,000
Techne Corp.		5,800		372,012
The Medicines Co. *		8,300		280,208
Theravance, Inc. *		9,700		327,375
Thermo Fisher Scientific, Inc.		53,302		4,300,405
United Therapeutics Corp. *		6,900		460,782
Vertex Pharmaceuticals, Inc. *		32,844		2,523,076
Vical, Inc. *		34,400		126,936
ViroPharma, Inc. *		9,700		264,325
VIVUS, Inc. (d)*		13,700		182,073
Warner Chilcott plc, Class A		25,000		359,500
Waters Corp. *		12,900		1,191,960
Xenoport, Inc. *		12,600		78,246
Zalicus, Inc. *		50,600		29,606
ZIOPHARM Oncology, Inc. (d)*		22,800		38,304
Zoetis, Inc.		12,700		419,354
				211,547,336
Real Estate 3.9%
Acadia Realty Trust		9,600		274,080
AG Mortgage Investment Trust, Inc.		5,000		129,350
Agree Realty Corp.		1,100		33,077
Alexander & Baldwin, Inc. *		6,400		217,984
Alexander’s Inc		300		92,397
Alexandria Real Estate Equities, Inc.		9,400		684,038
American Assets Trust, Inc.		4,700		158,672
American Campus Communities, Inc.		15,000		669,600
American Capital Agency Corp.		58,500		1,948,635
American Capital Mortgage Investment Corp.		9,000		239,040
American Realty Capital Properties, Inc.		22,200		364,968
American Realty Investors, Inc. *		1,537		6,148
American Tower Corp.		59,300		4,980,607
Annaly Capital Management, Inc.		145,500		2,319,270
Anworth Mortgage Asset Corp.		24,200		152,702
Apartment Investment & Management Co., Class A		20,511		638,097
Apollo Commercial Real Estate Finance, Inc.		3,600		63,864
Apollo Residential Mortgage, Inc.		4,800		106,848
ARMOUR Residential REIT, Inc.		61,000		395,890
Ashford Hospitality Trust		9,000		115,920
Associated Estates Realty Corp.		6,900		123,303
AV Homes, Inc. *		6,500		83,915
AvalonBay Communities, Inc.		16,892		2,247,312
BioMed Realty Trust, Inc.		32,500		731,575
Boston Properties, Inc.		22,500		2,462,175
Brandywine Realty Trust		21,063		314,471
BRE Properties, Inc.		11,000		555,280
Camden Property Trust		12,500		904,250
Campus Crest Communities, Inc.		7,300		99,718
Capstead Mortgage Corp.		13,440		178,483
CBL & Associates Properties, Inc.		22,285		537,960
CBRE Group, Inc., Class A *		46,800		1,133,496
Cedar Realty Trust, Inc.		11,400		73,074
Chesapeake Lodging Trust		8,500		201,110
Chimera Investment Corp.		146,600		483,780
Colonial Properties Trust		12,067		280,075
Colony Financial, Inc.		7,600		169,480
CommonWealth REIT		17,650		394,125
Consolidated-Tomoka Land Co.		2,000		74,420
Coresite Realty Corp.		3,400		123,012

52 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Corporate Office Properties Trust		11,400		330,486
Corrections Corp. of America		14,484		524,321
Cousins Properties, Inc.		18,545		202,511
CubeSmart		17,300		303,961
CYS Investments, Inc.		25,500		316,965
DCT Industrial Trust, Inc.		45,000		352,350
DDR Corp.		39,584		725,971
DiamondRock Hospitality Co.		26,686		266,326
Digital Realty Trust, Inc.		19,400		1,368,088
Douglas Emmett, Inc.		19,200		502,464
Duke Realty Corp.		45,990		811,264
DuPont Fabros Technology, Inc.		9,200		231,288
EastGroup Properties, Inc.		3,900		245,973
Education Realty Trust, Inc.		16,500		181,335
EPR Properties		6,600		373,164
Equity Lifestyle Properties, Inc.		6,000		487,500
Equity One, Inc.		12,100		308,429
Equity Residential		48,000		2,786,880
Essex Property Trust, Inc.		6,200		973,710
Excel Trust, Inc.		4,700		71,581
Extra Space Storage, Inc.		14,600		636,268
Federal Realty Investment Trust		9,600		1,123,296
FelCor Lodging Trust, Inc. *		18,200		108,836
First Industrial Realty Trust, Inc.		15,900		285,246
First Potomac Realty Trust		6,000		96,000
Forest City Enterprises, Inc., Class A *		18,400		343,528
Forestar Group, Inc. *		4,933		106,257
Franklin Street Properties Corp.		14,000		213,780
General Growth Properties, Inc.		65,709		1,492,908
Getty Realty Corp.		9,500		203,395
Glimcher Realty Trust		20,000		250,800
Government Properties Income Trust		9,900		257,895
Gramercy Property Trust, Inc. *		27,228		129,333
Hatteras Financial Corp.		13,800		377,154
HCP, Inc.		68,448		3,648,278
Health Care REIT, Inc.		39,400		2,953,818
Healthcare Realty Trust, Inc.		12,700		381,254
Healthcare Trust of America, Inc., Class A		8,800		109,824
Hersha Hospitality Trust		22,500		134,550
Highwoods Properties, Inc.		13,300		545,699
Home Properties, Inc.		7,500		483,450
Hospitality Properties Trust		21,600		635,256
Host Hotels & Resorts, Inc.		111,063		2,029,121
Howard Hughes Corp. *		4,100		386,958
Hudson Pacific Properties, Inc.		9,100		207,571
Inland Real Estate Corp.		20,300		229,796
Invesco Mortgage Capital, Inc.		18,000		385,200
Investors Real Estate Trust		11,500		111,895
iStar Financial, Inc. *		13,390		156,395
Jones Lang LaSalle, Inc.		6,600		653,532
Kennedy-Wilson Holdings, Inc.		6,400		106,432
Kilroy Realty Corp.		10,900		616,831
Kimco Realty Corp.		59,395		1,412,413
Kite Realty Group Trust		10,200		67,320
LaSalle Hotel Properties		13,700		355,241
Lexington Realty Trust		34,667		444,084
Liberty Property Trust		17,500		752,325
LTC Properties, Inc.		4,800		223,200
Mack-Cali Realty Corp.		11,400		316,578
Maui Land & Pineapple Co., Inc. *		800		3,384
Medical Properties Trust, Inc.		20,200		325,018
MFA Financial, Inc.		51,000		472,770
Mid-America Apartment Communities, Inc.		6,200		426,126
Monmouth Real Estate Investment Corp., Class A		5,700		60,648
MPG Office Trust, Inc. *		27,800		86,736
National Health Investors, Inc.		3,400		225,216
National Retail Properties, Inc.		17,920		711,066
New Century Financial Corp. (a)(c)*		3,600		—
NorthStar Realty Finance Corp.		29,500		294,115
Omega Healthcare Investors, Inc.		16,684		548,403
One Liberty Properties, Inc.		1,400		32,116
Parkway Properties, Inc.		12,800		233,344
Pebblebrook Hotel Trust		8,000		217,280
Pennsylvania Real Estate Investment Trust		8,500		176,205
PennyMac Mortgage Investment Trust		8,100		204,525
Piedmont Office Realty Trust, Inc., Class A		23,000		471,960
Plum Creek Timber Co., Inc.		24,547		1,265,152
PMC Commercial Trust		8,500		66,130
Post Properties, Inc.		8,200		405,326
Potlatch Corp.		5,753		272,405
Preferred Apartment Communities, Inc., Class A (d)		3,700		33,707
Prologis, Inc.		68,734		2,883,391
PS Business Parks, Inc.		3,000		239,400
Public Storage		21,690		3,578,850
RAIT Financial Trust		16,199		138,339
Ramco-Gershenson Properties Trust		6,900		120,543
Rayonier, Inc.		17,982		1,068,490
Realogy Holdings Corp. *		17,700		849,600
Realty Income Corp.		31,735		1,617,533
Redwood Trust, Inc.		11,300		257,866
Regency Centers Corp.		12,700		714,502
Resource Capital Corp.		28,600		188,474
Retail Opportunity Investments Corp.		7,000		103,670
Retail Properties of America, Inc., Class A		9,700		148,507
RLJ Lodging Trust		21,000		483,840
Rouse Properties, Inc.		5,815		110,194
Ryman Hospitality Properties (d)		7,837		348,433
Sabra Health Care REIT, Inc.		8,000		238,560
Saul Centers, Inc.		2,000		89,600
Select Income REIT		4,500		128,385
Senior Housing Properties Trust		27,850		791,776
Silver Bay Realty Trust Corp.		5,133		97,938
Simon Property Group, Inc.		47,183		8,401,877
SL Green Realty Corp.		14,150		1,283,405
Sovran Self Storage, Inc.		4,500		308,700
Spirit Realty Capital, Inc.		4,900		105,497
STAG Industrial, Inc.		6,800		149,872
Starwood Property Trust, Inc.		24,400		670,756
Strategic Hotels & Resorts, Inc. *		25,000		201,750
Summit Hotel Properties, Inc.		9,600		95,904
Sun Communities, Inc.		3,900		199,485

See financial notes 53

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Sunstone Hotel Investors, Inc. *		27,600		342,516
Tanger Factory Outlet Centers, Inc.		13,700		508,544
Taubman Centers, Inc.		10,100		863,651
Tejon Ranch Co. *		3,674		107,207
The Geo Group, Inc.		9,999		374,463
The Macerich Co.		20,405		1,429,370
The St. Joe Co. *		12,900		252,453
Thomas Properties Group, Inc.		5,600		28,504
Two Harbors Investment Corp.		60,300		722,394
UDR, Inc.		36,961		908,501
UMH Properties, Inc.		7,900		87,295
Universal Health Realty Income Trust		1,800		96,714
Urstadt Biddle Properties, Inc., Class A		4,500		100,215
Ventas, Inc.		43,750		3,483,813
Vornado Realty Trust REIT		25,241		2,210,102
Washington Real Estate Investment Trust		9,700		277,032
Weingarten Realty Investors		17,175		585,152
Western Asset Mortgage Capital Corp.		4,200		94,080
Weyerhaeuser Co.		80,792		2,464,964
Whitestone REIT (d)		2,100		34,650
Winthrop Realty Trust		10,000		127,100
WP Carey, Inc.		8,100		571,212
				106,915,186
Retailing 4.2%
Aaron’s, Inc.		9,375		269,156
Abercrombie & Fitch Co., Class A		11,800		584,808
Advance Auto Parts, Inc.		10,940		917,647
Aeropostale, Inc. *		9,900		145,134
ALCO Stores, Inc. *		1,800		13,320
Amazon.com, Inc. *		54,800		13,908,788
America’s Car-Mart, Inc. *		2,650		122,616
American Eagle Outfitters, Inc.		27,450		533,902
ANN, Inc. *		6,625		195,703
Asbury Automotive Group, Inc. *		4,100		164,369
Ascena Retail Group, Inc. *		17,636		326,266
AutoNation, Inc. *		6,600		300,366
AutoZone, Inc. *		5,500		2,249,995
Barnes & Noble, Inc. (d)*		7,400		134,162
Bed Bath & Beyond, Inc. *		34,200		2,352,960
Best Buy Co., Inc.		39,225		1,019,458
Big Lots, Inc. *		11,100		404,262
Brown Shoe Co., Inc.		6,675		112,874
Cabela’s, Inc. *		6,500		417,300
CarMax, Inc. *		33,346		1,535,250
Chico’s FAS, Inc.		22,800		416,556
Christopher & Banks Corp. *		13,400		93,130
Coldwater Creek, Inc. (d)*		16,125		57,566
Conn’s, Inc. *		3,300		142,923
Core-Mark Holding Co., Inc.		2,000		104,080
Destination Maternity Corp.		5,000		118,750
Dick’s Sporting Goods, Inc.		14,600		702,260
Dillard’s, Inc., Class A		4,300		354,363
Dollar General Corp. *		45,100		2,349,259
Dollar Tree, Inc. *		33,650		1,600,394
DSW, Inc., Class A		4,480		296,218
Expedia, Inc.		13,872		774,612
Express, Inc. *		12,600		229,446
Family Dollar Stores, Inc.		15,700		963,509
Five Below, Inc. *		2,500		89,975
Foot Locker, Inc.		21,400		746,218
Francesca’s Holdings Corp. *		4,900		139,944
Fred’s, Inc., Class A		6,700		95,341
GameStop Corp., Class A (d)		17,548		612,425
Geeknet, Inc. *		452		5,912
Genesco, Inc. *		4,300		264,665
Genuine Parts Co.		24,000		1,831,920
GNC Holdings, Inc., Class A		11,200		507,696
Group 1 Automotive, Inc.		4,400		266,112
Groupon, Inc. (d)*		42,300		258,030
Guess?, Inc.		7,900		218,672
Hibbett Sports, Inc. *		3,543		194,334
HomeAway, Inc. *		3,900		119,145
HSN, Inc.		6,269		329,624
J.C. Penney Co., Inc. (d)*		20,000		328,400
Jos. A. Bank Clothiers, Inc. *		3,600		157,248
Kayak Software Corp. *		2,800		111,496
Kirkland’s, Inc. *		8,700		104,922
Kohl’s Corp.		31,600		1,487,096
L Brands, Inc.		37,020		1,866,178
Liberty Interactive Corp., Class A *		80,309		1,709,779
Liberty Ventures, Series A *		4,165		306,003
Lithia Motors, Inc., Class A		3,300		163,416
LKQ Corp. *		43,300		1,042,664
Lowe’s Cos., Inc.		167,800		6,446,876
Lumber Liquidators Holdings, Inc. *		3,400		278,664
Macy’s, Inc.		60,552		2,700,619
MarineMax, Inc. *		7,000		81,130
Monro Muffler Brake, Inc.		4,462		184,548
Netflix, Inc. *		8,300		1,793,381
Nordstrom, Inc.		22,500		1,273,275
O’Reilly Automotive, Inc. *		16,699		1,792,137
Office Depot, Inc. *		69,900		269,814
OfficeMax, Inc.		22,400		257,824
Pacific Sunwear of California, Inc. *		41,175		113,231
Penske Automotive Group, Inc.		6,300		194,796
PetSmart, Inc.		15,900		1,085,016
Pier 1 Imports, Inc.		15,800		366,718
Pool Corp.		6,662		326,571
Priceline.com, Inc. *		7,483		5,208,093
RadioShack Corp. (d)		27,200		86,224
Rent-A-Center, Inc.		7,750		270,708
Ross Stores, Inc.		32,900		2,173,703
Saks, Inc. *		14,800		170,940
Sally Beauty Holdings, Inc. *		22,050		662,823
Sears Holdings Corp. (d)*		6,385		327,806
Select Comfort Corp. *		7,300		154,906
Shoe Carnival, Inc.		6,300		131,229
Shutterfly, Inc. *		4,600		204,838
Signet Jewelers Ltd.		12,500		859,125
Sonic Automotive, Inc., Class A		4,400		96,756
Stage Stores, Inc.		5,700		157,833
Staples, Inc.		99,700		1,320,028
Stein Mart, Inc.		10,300		81,473
Systemax, Inc.		8,000		73,280
Target Corp.		98,600		6,957,216
The Buckle, Inc. (d)		3,875		188,131

54 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
The Cato Corp., Class A		3,800		91,238
The Children’s Place Retail Stores, Inc. *		3,600		176,112
The Finish Line, Inc., Class A		7,161		138,852
The Gap, Inc.		46,100		1,751,339
The Home Depot, Inc.		225,370		16,530,889
The Men’s Wearhouse, Inc.		6,600		221,100
The Pep Boys - Manny, Moe & Jack *		7,900		91,640
The TJX Cos., Inc.		110,900		5,408,593
The Wet Seal, Inc., Class A *		31,400		102,364
Tiffany & Co.		17,500		1,289,400
Tractor Supply Co.		10,500		1,125,285
Trans World Entertainment Corp.		9,700		41,710
TripAdvisor, Inc. *		15,672		824,034
Tuesday Morning Corp. *		10,800		87,588
Ulta Salon, Cosmetics & Fragrance, Inc. *		8,800		771,320
Urban Outfitters, Inc. *		15,800		654,752
Vitamin Shoppe, Inc. *		4,200		206,430
VOXX International Corp. *		9,100		86,723
West Marine, Inc. *		8,200		97,006
Williams-Sonoma, Inc.		12,200		654,896
Winmark Corp.		1,700		105,179
Zale Corp. *		17,420		77,345
Zumiez, Inc. *		4,500		130,365
				113,822,489
Semiconductors & Semiconductor Equipment 2.1%
Advanced Energy Industries, Inc. *		6,900		117,162
Advanced Micro Devices, Inc. (d)*		84,700		238,854
Altera Corp.		46,700		1,494,867
Amkor Technology, Inc. (d)*		21,000		88,830
Amtech Systems, Inc. *		3,500		12,985
ANADIGICS, Inc. *		8,150		17,115
Analog Devices, Inc.		45,000		1,979,550
Applied Materials, Inc.		179,398		2,603,065
Applied Micro Circuits Corp. *		12,800		95,488
Atmel Corp. *		64,100		414,727
ATMI, Inc. *		4,400		95,700
AXT, Inc. *		3,500		10,045
Broadcom Corp., Class A		77,400		2,786,400
Brooks Automation, Inc.		11,885		115,522
Cabot Microelectronics Corp. *		2,960		99,190
Cavium, Inc. *		7,000		220,150
CEVA, Inc. *		7,233		110,376
Cirrus Logic, Inc. *		9,800		189,238
Cohu, Inc.		7,500		71,775
Cree, Inc. *		18,400		1,040,888
Cymer, Inc. *		4,600		481,896
Cypress Semiconductor Corp. *		19,500		196,755
Diodes, Inc. *		6,412		129,907
DSP Group, Inc. *		6,300		50,841
Entegris, Inc. *		19,299		182,955
Entropic Communications, Inc. *		20,100		85,224
Exar Corp. *		9,834		106,011
Fairchild Semiconductor International, Inc. *		17,800		229,620
First Solar, Inc. *		8,600		400,416
FormFactor, Inc. *		14,600		72,270
GSI Technology, Inc. *		8,500		53,040
GT Advanced Technologies, Inc. (d)*		29,500		115,935
Hittite Microwave Corp. *		4,500		252,495
Integrated Device Technology, Inc. *		16,120		114,613
Integrated Silicon Solutions, Inc. *		9,338		85,629
Intel Corp.		746,932		17,889,021
International Rectifier Corp. *		8,600		182,406
Intersil Corp., Class A		15,364		119,225
IXYS Corp.		6,900		62,514
KLA-Tencor Corp.		24,600		1,334,550
Kopin Corp. *		19,600		64,876
Kulicke & Soffa Industries, Inc. *		10,400		120,224
Lam Research Corp. *		24,267		1,121,621
Lattice Semiconductor Corp. *		25,100		116,715
Linear Technology Corp.		34,200		1,248,300
LSI Corp. *		79,587		520,499
Marvell Technology Group Ltd.		65,400		703,704
Maxim Integrated Products, Inc.		43,100		1,333,083
MEMC Electronic Materials, Inc. *		38,900		210,060
Micrel, Inc.		9,700		97,582
Microchip Technology, Inc.		28,375		1,033,417
Micron Technology, Inc. *		151,799		1,429,947
Microsemi Corp. *		13,152		273,562
MKS Instruments, Inc.		7,900		212,273
Monolithic Power Systems, Inc.		6,500		156,780
MoSys, Inc. *		6,400		28,928
Nanometrics, Inc. *		5,300		74,359
NVIDIA Corp.		91,100		1,254,447
OmniVision Technologies, Inc. *		7,800		104,598
ON Semiconductor Corp. *		62,865		494,119
Pericom Semiconductor Corp. *		6,600		42,636
Photronics, Inc. *		18,000		142,020
PLX Technology, Inc. *		14,100		65,847
PMC-Sierra, Inc. *		27,300		157,248
Power Integrations, Inc.		4,200		173,922
Rambus, Inc. *		19,600		136,416
RF Micro Devices, Inc. *		40,720		228,439
Rudolph Technologies, Inc. *		6,518		76,065
Semtech Corp. *		9,700		311,079
Silicon Image, Inc. *		19,500		96,135
Silicon Laboratories, Inc. *		5,000		198,550
Skyworks Solutions, Inc. *		28,789		635,373
Spansion, Inc., Class A *		8,600		111,714
SunPower Corp. *		14,500		197,055
Supertex, Inc.		4,900		103,292
Teradyne, Inc. *		27,359		449,782
Tessera Technologies, Inc.		6,000		122,220
Texas Instruments, Inc.		167,197		6,054,203
TriQuint Semiconductor, Inc. *		19,310		112,770
Ultratech, Inc. *		4,800		141,456
Veeco Instruments, Inc. *		5,500		209,385
Volterra Semiconductor Corp. *		6,500		84,565
Xilinx, Inc.		38,000		1,440,580
				55,837,096
Software & Services 9.1%
Accelrys, Inc. *		13,264		130,650
Accenture plc, Class A		97,100		7,907,824
ACI Worldwide, Inc. *		5,200		244,452
Activision Blizzard, Inc.		66,532		994,653

See financial notes 55

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Actuate Corp. *		13,962		85,727
Acxiom Corp. *		13,300		264,537
Adobe Systems, Inc. *		76,110		3,431,039
Advent Software, Inc. *		4,500		130,680
Akamai Technologies, Inc. *		25,838		1,134,547
Alliance Data Systems Corp. *		7,400		1,271,098
Angie’s List, Inc. *		8,000		193,920
ANSYS, Inc. *		13,686		1,106,650
AOL, Inc. *		14,122		545,674
Aspen Technology, Inc. *		13,400		408,432
Autodesk, Inc. *		32,800		1,291,664
Automatic Data Processing, Inc.		73,400		4,942,756
Bankrate, Inc. *		8,700		117,276
Bazaarvoice, Inc. *		15,200		110,200
Blackbaud, Inc.		6,000		175,860
Blucora, Inc. *		6,872		101,499
BMC Software, Inc. *		21,300		968,724
Booz Allen Hamilton Holding Corp.		12,300		186,837
Bottomline Technologies, Inc. *		5,000		131,000
Broadridge Financial Solutions, Inc.		17,725		446,316
BroadSoft, Inc. *		3,700		94,572
CA, Inc.		50,508		1,362,201
CACI International, Inc., Class A *		4,100		239,809
Cadence Design Systems, Inc. *		41,400		571,320
Cardtronics, Inc. *		5,000		140,050
CIBER, Inc. *		24,900		106,074
Citrix Systems, Inc. *		27,900		1,734,543
Cognizant Technology Solutions Corp., Class A *		45,900		2,974,320
CommVault Systems, Inc. *		5,900		433,886
Computer Sciences Corp.		22,638		1,060,590
Compuware Corp. *		31,800		381,600
comScore, Inc. *		7,500		121,275
Comverse, Inc. *		3,550		94,182
Concur Technologies, Inc. *		7,600		555,636
Constant Contact, Inc. *		7,000		102,270
Convergys Corp.		16,000		272,320
CoreLogic, Inc. *		13,800		376,464
Cornerstone OnDemand, Inc. *		3,900		141,492
CoStar Group, Inc. *		3,800		411,958
CSG Systems International, Inc. *		5,400		116,694
Dealertrack Technologies, Inc. *		6,100		169,885
Demand Media, Inc. *		11,500		99,590
Demandware, Inc. *		6,800		185,640
Digimarc Corp.		3,542		77,711
Digital River, Inc. *		7,100		102,808
DST Systems, Inc.		4,300		297,345
Dynamics Research Corp. *		1,200		7,008
EarthLink, Inc.		17,050		97,015
eBay, Inc. *		175,848		9,212,677
Ebix, Inc. (d)		7,200		133,992
Edgewater Technology, Inc. *		767		2,961
Electronic Arts, Inc. *		47,100		829,431
Ellie Mae, Inc. *		4,700		122,294
EPAM Systems, Inc. *		4,800		103,200
EPIQ Systems, Inc.		8,525		119,094
Equinix, Inc. *		7,565		1,619,666
Euronet Worldwide, Inc. *		5,500		167,915
ExactTarget, Inc. *		4,800		93,984
ExlService Holdings, Inc. *		3,600		117,432
Facebook, Inc., Class A *		81,700		2,267,992
FactSet Research Systems, Inc.		5,850		550,310
Fair Isaac Corp.		4,744		220,976
FalconStor Software, Inc. *		1,200		1,980
Fidelity National Information Services, Inc.		43,806		1,842,042
Fiserv, Inc. *		19,700		1,794,867
FleetCor Technologies, Inc. *		10,400		799,760
Forrester Research, Inc.		4,100		146,985
Fortinet, Inc. *		18,500		332,260
Gartner, Inc. *		13,300		769,405
Genpact Ltd.		18,800		349,680
Global Cash Access Holdings, Inc. *		10,700		76,291
Global Payments, Inc.		11,440		530,816
Google, Inc., Class A *		40,265		33,201,311
GSE Systems, Inc. *		2,424		4,581
Guidewire Software, Inc. *		4,200		168,336
Heartland Payment Systems, Inc.		4,500		148,005
Higher One Holdings, Inc. (d)*		7,900		77,894
IAC/InterActiveCorp		11,372		535,280
iGATE Corp. *		5,100		85,119
Imperva, Inc. *		2,600		101,348
Infoblox, Inc. *		5,200		114,972
Informatica Corp. *		15,100		497,243
Information Services Group, Inc. *		7,500		14,850
Interactive Intelligence Group, Inc. *		2,900		120,147
Internap Network Services Corp. *		13,200		105,336
International Business Machines Corp.		157,910		31,983,091
IntraLinks Holdings, Inc. *		12,200		69,784
Intuit, Inc.		41,530		2,476,849
j2 Global, Inc.		6,000		244,200
Jack Henry & Associates, Inc.		12,000		556,800
Jive Software, Inc. *		8,600		116,874
Lender Processing Services, Inc.		11,157		309,495
LinkedIn Corp., Class A *		10,500		2,016,945
Lionbridge Technologies, Inc. *		19,500		66,690
Liquidity Services, Inc. (d)*		3,400		111,860
LivePerson, Inc. *		6,800		87,176
LogMeIn, Inc. *		4,400		99,352
LookSmart Ltd. *		480		341
Manhattan Associates, Inc. *		4,300		301,903
ManTech International Corp., Class A		5,000		133,450
MasterCard, Inc., Class A		16,000		8,846,880
Mattersight Corp. (d)*		190		889
MAXIMUS, Inc.		4,800		382,512
Mentor Graphics Corp.		13,800		251,988
MICROS Systems, Inc. *		11,400		483,474
Microsoft Corp.		1,136,250		37,609,875
MicroStrategy, Inc., Class A *		1,256		113,279
Millennial Media, Inc. *		8,600		59,598
ModusLink Global Solutions, Inc. *		10,450		29,260
MoneyGram International, Inc. *		9,037		149,201
Monotype Imaging Holdings, Inc.		6,500		150,735
Monster Worldwide, Inc. *		14,300		62,634
Move, Inc. *		12,430		141,826
NetScout Systems, Inc. *		7,300		166,513
NetSuite, Inc. *		3,900		343,044
NeuStar, Inc., Class A *		9,300		407,991

56 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
NIC, Inc.		8,000		134,720
Nuance Communications, Inc. *		36,974		703,985
OpenTable, Inc. *		3,400		188,326
Oracle Corp.		556,549		18,243,676
Paychex, Inc.		50,100		1,824,141
Pegasystems, Inc.		3,700		93,647
Perficient, Inc. *		7,800		81,744
PRGX Global, Inc. *		11,000		61,490
Progress Software Corp. *		9,300		209,901
PTC, Inc. *		17,680		424,497
QLIK Technologies, Inc. *		11,200		291,312
Rackspace Hosting, Inc. *		16,500		795,300
RealNetworks, Inc. *		12,725		97,983
RealPage, Inc. *		5,900		120,360
Red Hat, Inc. *		28,200		1,351,626
Reis, Inc. *		1,400		22,442
Rovi Corp. *		15,412		360,487
SAIC, Inc.		44,000		657,360
Salesforce.com, Inc. *		80,400		3,305,244
Sapient Corp. *		16,100		188,048
SeaChange International, Inc. *		9,250		100,455
ServiceNow, Inc. *		3,200		131,072
ServiceSource International, Inc. *		14,400		92,160
Solarwinds, Inc. *		8,600		437,310
Solera Holdings, Inc.		10,100		581,558
Sourcefire, Inc. *		3,900		186,264
Splunk, Inc. *		3,700		150,960
SS&C Technologies Holdings, Inc. *		8,100		248,589
StarTek, Inc. *		3,900		27,027
Support.com, Inc. *		18,400		73,416
Sykes Enterprises, Inc. *		11,026		169,690
Symantec Corp. *		103,573		2,516,824
Synchronoss Technologies, Inc. *		4,700		133,198
Synopsys, Inc. *		22,084		785,528
Syntel, Inc.		2,500		157,925
Take-Two Interactive Software, Inc. *		12,900		196,854
Tangoe, Inc. *		8,200		105,452
TeleCommunication Systems, Inc., Class A *		10,800		20,844
TeleTech Holdings, Inc. *		5,000		106,450
Teradata Corp. *		25,000		1,276,750
The Active Network, Inc. *		13,300		66,899
The Hackett Group, Inc.		7,200		35,136
The Western Union Co.		89,032		1,318,564
TIBCO Software, Inc. *		23,200		450,312
TiVo, Inc. *		17,800		208,616
Total System Services, Inc.		22,804		538,630
Tyler Technologies, Inc. *		4,000		252,960
Ultimate Software Group, Inc. *		4,200		405,678
Unisys Corp. *		6,200		118,606
United Online, Inc.		17,350		117,980
Unwired Planet, Inc. *		7,771		15,387
ValueClick, Inc. *		12,000		370,320
Vantiv, Inc., Class A *		4,600		103,638
VeriFone Systems, Inc. *		15,400		330,792
Verint Systems, Inc. *		6,510		215,090
VeriSign, Inc. *		22,275		1,026,209
Virnetx Holding Corp. (d)*		5,500		112,310
Virtusa Corp. *		4,700		104,387
Visa, Inc., Class A		77,800		13,106,188
VMware, Inc., Class A *		12,400		874,200
Web.com Group, Inc. *		5,423		94,360
WebMD Health Corp. *		7,074		170,837
Websense, Inc. *		7,500		133,800
WEX, Inc. *		5,700		431,946
Workday, Inc., Class A *		3,200		200,480
Yahoo! Inc. *		144,644		3,577,046
Yelp, Inc. *		4,300		111,929
Zillow, Inc., Class A (d)*		4,500		264,735
Zynga, Inc., Class A *		65,200		207,988
				245,424,852
Technology Hardware & Equipment 5.7%
3D Systems Corp. (d)*		13,300		508,592
ADTRAN, Inc.		9,100		191,100
Agilysys, Inc. *		8,460		98,813
Amphenol Corp., Class A		23,400		1,767,168
Anaren, Inc. *		5,300		124,073
Anixter International, Inc.		4,000		286,960
Apple, Inc.		141,600		62,693,400
ARRIS Group, Inc. *		16,175		267,049
Arrow Electronics, Inc. *		15,700		615,911
Aruba Networks, Inc. *		15,700		353,093
Aviat Networks, Inc. *		18,877		60,406
Avid Technology, Inc. *		7,956		52,430
Avnet, Inc. *		20,088		657,882
AVX Corp.		14,000		158,340
Badger Meter, Inc.		4,000		174,720
Benchmark Electronics, Inc. *		7,830		139,687
Black Box Corp.		4,100		89,052
Brocade Communications Systems, Inc. *		64,935		377,922
Checkpoint Systems, Inc. *		7,100		82,147
Ciena Corp. *		12,970		194,031
Cisco Systems, Inc.		803,609		16,811,500
Cognex Corp.		4,900		194,530
Coherent, Inc.		2,800		156,604
Comtech Telecommunications Corp.		4,175		102,747
Corning, Inc.		220,507		3,197,351
Cray, Inc. *		7,600		160,816
CTS Corp.		8,800		93,720
Daktronics, Inc.		8,700		86,913
Dell, Inc.		217,700		2,917,180
Diebold, Inc.		9,000		263,610
Digi International, Inc. *		9,100		82,992
Dolby Laboratories, Inc., Class A		8,800		289,080
DTS, Inc. *		4,300		72,154
Echelon Corp. *		7,200		15,912
EchoStar Corp., Class A *		7,540		296,096
Electro Rent Corp.		7,100		117,647
Electro Scientific Industries, Inc.		9,900		106,722
Electronics for Imaging, Inc. *		6,400		171,008
EMC Corp. *		318,986		7,154,856
Emulex Corp. *		14,100		84,600
Extreme Networks, Inc. *		27,500		91,575
F5 Networks, Inc. *		11,500		878,945
FARO Technologies, Inc. *		3,000		116,370
FEI Co.		5,400		344,952
Finisar Corp. *		12,000		154,080
FLIR Systems, Inc.		21,900		532,389

See financial notes 57

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Frequency Electronics, Inc.		500		5,010
Fusion-io, Inc. (d)*		9,500		178,410
Gerber Scientific, Inc. (a)(c)*		8,900		—
Harmonic, Inc. *		20,042		113,839
Harris Corp.		17,000		785,400
Hewlett-Packard Co.		296,036		6,098,342
Hutchinson Technology, Inc. *		6,000		16,800
I.D. Systems, Inc. *		5,500		29,700
Identive Group, Inc. *		1,200		1,140
Imation Corp. *		5,500		20,240
Immersion Corp. *		4,300		45,537
Infinera Corp. *		16,400		138,088
Ingram Micro, Inc., Class A *		22,400		398,944
Insight Enterprises, Inc. *		4,650		84,258
Intellicheck Mobilisa, Inc. *		500		255
InterDigital, Inc.		6,700		297,547
Intermec, Inc. *		9,600		94,464
InvenSense, Inc. *		17,600		164,032
IPG Photonics Corp. (d)		4,600		292,928
Itron, Inc. *		5,700		226,005
Ixia *		8,200		135,054
Jabil Circuit, Inc.		27,700		493,060
JDS Uniphase Corp. *		34,153		461,065
Juniper Networks, Inc. *		76,265		1,262,186
Lexmark International, Inc., Class A		10,900		330,379
LightPath Technologies, Inc., Class A *		75		54
Littelfuse, Inc.		3,700		258,334
Maxwell Technologies, Inc. *		7,700		46,970
Measurement Specialties, Inc. *		3,200		136,864
Mercury Systems, Inc. *		7,800		60,294
Methode Electronics, Inc.		9,500		136,610
MOCON, Inc.		600		8,700
Molex, Inc.		19,125		527,276
Motorola Solutions, Inc.		41,879		2,395,479
MTS Systems Corp.		3,781		230,452
Multi-Fineline Electronix, Inc. *		5,700		86,868
National Instruments Corp.		13,212		361,084
NCR Corp. *		23,800		649,026
NetApp, Inc. *		53,500		1,866,615
NETGEAR, Inc. *		6,000		178,740
Newport Corp. *		8,500		128,775
OCZ Technology Group, Inc. (d)*		10,200		13,362
Oplink Communications, Inc. *		5,957		97,814
OSI Systems, Inc. *		3,700		212,010
Palo Alto Networks, Inc. *		4,700		254,270
Park Electrochemical Corp.		3,600		85,932
PC Connection, Inc.		7,000		108,080
PC-Tel, Inc.		8,900		59,363
Performance Technologies, Inc. *		1,600		1,344
Plantronics, Inc.		6,000		262,920
Plexus Corp. *		3,700		99,789
Polycom, Inc. *		22,400		235,200
Power-One, Inc. *		23,800		150,416
Pulse Electronics Corp. *		11,500		3,749
QLogic Corp. *		17,044		185,098
QUALCOMM, Inc.		259,000		15,959,580
Radisys Corp. *		7,200		35,712
Research Frontiers, Inc. (d)*		2,800		11,620
Richardson Electronics Ltd.		7,300		85,629
Riverbed Technology, Inc. *		22,700		337,322
Rofin-Sinar Technologies, Inc. *		3,800		94,620
Rogers Corp. *		2,500		106,600
SanDisk Corp. *		37,300		1,956,012
Sanmina Corp. *		20,900		263,758
ScanSource, Inc. *		3,200		92,704
Seagate Technology plc		49,766		1,826,412
Sonus Networks, Inc. *		44,900		94,290
STEC, Inc. *		12,300		44,649
Super Micro Computer, Inc. *		8,200		78,884
Symmetricom, Inc. *		11,950		62,140
Synaptics, Inc. *		5,250		216,458
SYNNEX Corp. *		3,000		103,800
TE Connectivity Ltd.		63,000		2,743,650
Tech Data Corp. *		5,300		247,669
Tellabs, Inc.		38,064		78,792
TESSCO Technologies, Inc.		4,025		82,271
TransAct Technologies, Inc.		1,500		11,265
Trimble Navigation Ltd. *		36,784		1,057,172
TTM Technologies, Inc. *		11,000		79,530
Ubiquiti Networks, Inc.		6,900		106,605
Universal Display Corp. *		5,800		182,352
ViaSat, Inc. *		5,500		266,585
Vishay Intertechnology, Inc. *		18,588		260,976
Vishay Precision Group, Inc. *		5,620		80,535
Western Digital Corp.		32,600		1,802,128
Xerox Corp.		186,756		1,602,366
Xybernaut Corp. (a)(c)*		1,400		—
Zebra Technologies Corp., Class A *		7,375		344,044
Zygo Corp. *		7,000		104,720
				154,322,146
Telecommunication Services 2.6%
8x8, Inc. *		14,600		105,558
Alaska Communications Systems Group, Inc.		5,000		8,100
Alteva, Inc.		1,100		11,462
AT&T, Inc.		827,756		31,007,740
Atlantic Tele-Network, Inc.		3,250		165,002
CenturyLink, Inc.		95,078		3,572,080
Cincinnati Bell, Inc. *		32,268		113,583
Clearwire Corp., Class A *		62,900		211,344
Cogent Communications Group, Inc.		9,900		283,536
Consolidated Communications Holdings, Inc.		5,253		96,813
Crown Castle International Corp. *		44,776		3,447,752
Frontier Communications Corp. (d)		146,868		610,971
General Communication, Inc., Class A *		10,500		101,955
HickoryTech Corp.		4,600		47,288
Iridium Communications, Inc. *		11,800		79,178
Leap Wireless International, Inc. (d)*		13,000		74,360
Level 3 Communications, Inc. *		23,006		463,111
Lumos Networks Corp.		1,500		20,235
MetroPCS Communications, Inc. *		44,500		526,880
NII Holdings, Inc. (d)*		27,900		242,730
NTELOS Holdings Corp.		4,500		66,240
Premiere Global Services, Inc. *		11,400		128,022

58 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
SBA Communications Corp., Class A *		18,700		1,477,113
Shenandoah Telecommunications Co.		2,500		40,975
Sprint Nextel Corp. *		448,230		3,160,021
Telephone & Data Systems, Inc.		14,222		319,142
tw telecom, Inc. *		21,600		584,928
United States Cellular Corp. *		2,400		92,256
USA Mobility, Inc.		5,500		74,635
Verizon Communications, Inc.		430,772		23,222,919
Vonage Holdings Corp. *		36,400		111,020
Windstream Corp.		87,969		749,496
				71,216,445
Transportation 1.9%
Alaska Air Group, Inc. *		10,100		622,564
Allegiant Travel Co.		2,000		179,800
AMERCO		1,000		160,700
Arkansas Best Corp.		9,900		104,049
Atlas Air Worldwide Holdings, Inc. *		3,800		142,120
Avis Budget Group, Inc. *		17,500		504,700
C.H. Robinson Worldwide, Inc.		23,800		1,413,482
Con-way, Inc.		7,500		253,500
Covenant Transport Group, Inc., Class A *		3,000		16,650
CSX Corp.		152,600		3,752,434
Delta Air Lines, Inc. *		130,600		2,238,484
Expeditors International of Washington, Inc.		30,500		1,095,865
FedEx Corp.		44,163		4,151,764
Forward Air Corp.		4,600		169,694
Genco Shipping & Trading Ltd. (d)*		21,500		36,765
Genesee & Wyoming, Inc., Class A *		7,400		630,480
Heartland Express, Inc.		8,941		121,329
Hertz Global Holdings, Inc. *		54,600		1,314,768
Hub Group, Inc., Class A *		4,400		161,260
J.B. Hunt Transport Services, Inc.		13,500		959,445
JetBlue Airways Corp. *		30,962		213,328
Kansas City Southern		16,250		1,772,387
Kirby Corp. *		8,600		644,054
Knight Transportation, Inc.		9,050		141,361
Landstar System, Inc.		6,600		360,756
Matson, Inc.		6,400		150,656
Norfolk Southern Corp.		48,100		3,723,902
Old Dominion Freight Line, Inc. *		12,112		466,312
Pacer International, Inc. *		17,800		101,282
Park-Ohio Holdings Corp. *		3,600		132,408
Republic Airways Holdings, Inc. *		12,500		139,875
Roadrunner Transportation Systems, Inc. *		4,900		110,299
Ryder System, Inc.		7,500		435,525
Saia, Inc. *		6,100		249,612
SkyWest, Inc.		7,000		100,170
Southwest Airlines Co.		106,315		1,456,516
Spirit Airlines, Inc. *		5,600		149,520
Swift Transportation Co. *		19,000		266,380
Union Pacific Corp.		70,900		10,490,364
United Continental Holdings, Inc. *		48,500		1,566,550
United Parcel Service, Inc., Class B		108,080		9,277,587
Universal Truckload Services, Inc. *		3,300		83,292
US Airways Group, Inc. (d)*		24,000		405,600
UTI Worldwide, Inc.		14,600		214,474
Werner Enterprises, Inc.		5,832		133,903
Wesco Aircraft Holdings, Inc. *		7,900		130,429
				50,946,395
Utilities 3.6%
AGL Resources, Inc.		18,629		816,882
ALLETE, Inc.		5,233		268,714
Alliant Energy Corp.		16,300		872,213
Ameren Corp.		36,200		1,312,250
American DG Energy, Inc. *		11,400		20,976
American Electric Power Co., Inc.		73,920		3,801,706
American States Water Co.		2,800		155,344
American Water Works Co., Inc.		26,100		1,093,068
Aqua America, Inc.		20,694		656,621
Artesian Resources Corp., Class A		4,000		94,280
Atmos Energy Corp.		14,200		630,054
Avista Corp.		7,800		218,790
Black Hills Corp.		5,600		262,584
Cadiz, Inc. *		6,356		37,437
California Water Service Group		6,000		120,300
Calpine Corp. *		57,800		1,255,994
CenterPoint Energy, Inc.		66,500		1,641,220
CH Energy Group, Inc.		1,900		123,443
Chesapeake Utilities Corp.		2,847		151,916
Cleco Corp.		8,700		430,824
CMS Energy Corp.		39,000		1,167,660
Connecticut Water Service, Inc.		5,100		145,248
Consolidated Edison, Inc.		43,700		2,781,505
Delta Natural Gas Co., Inc.		1,291		27,989
Dominion Resources, Inc.		87,280		5,383,430
DTE Energy Co.		25,501		1,858,513
Duke Energy Corp.		106,473		8,006,770
Dynegy, Inc. *		17,000		420,070
Edison International		48,610		2,615,218
El Paso Electric Co.		5,300		198,538
Entergy Corp.		26,300		1,873,349
Exelon Corp.		128,769		4,830,125
FirstEnergy Corp.		62,356		2,905,790
Genie Energy Ltd., Class B		12,800		137,984
Great Plains Energy, Inc.		21,541		519,784
Hawaiian Electric Industries, Inc.		13,300		376,390
IDACORP, Inc.		7,100		349,391
Integrys Energy Group, Inc.		11,140		685,778
ITC Holdings Corp.		7,500		691,650
MDU Resources Group, Inc.		26,625		664,294
MGE Energy, Inc.		3,300		184,305
Middlesex Water Co.		4,500		88,245
National Fuel Gas Co.		12,400		777,728
New Jersey Resources Corp.		6,225		293,820
NextEra Energy, Inc.		64,100		5,258,123
NiSource, Inc.		45,464		1,397,109
Northeast Utilities		46,643		2,114,327
Northwest Natural Gas Co.		3,800		168,986
NorthWestern Corp.		7,100		305,442
NRG Energy, Inc.		48,056		1,339,321
NV Energy, Inc.		37,076		801,954

See financial notes 59

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
OGE Energy Corp.		14,900		1,079,207
ONEOK, Inc.		30,300		1,556,208
Ormat Technologies, Inc.		8,600		186,964
Otter Tail Corp.		4,100		127,920
Pepco Holdings, Inc.		37,400		845,240
PG&E Corp.		66,200		3,206,728
Piedmont Natural Gas Co., Inc.		12,300		423,489
Pinnacle West Capital Corp.		16,200		986,580
PNM Resources, Inc.		11,200		268,912
Portland General Electric Co.		10,900		351,525
PPL Corp.		86,800		2,897,384
Public Service Enterprise Group, Inc.		75,500		2,764,055
Pure Cycle Corp. *		8,000		47,040
Questar Corp.		24,700		627,133
SCANA Corp.		21,905		1,187,251
Sempra Energy		33,575		2,781,689
SJW Corp.		5,570		141,255
South Jersey Industries, Inc.		4,200		259,140
Southwest Gas Corp.		6,500		329,355
TECO Energy, Inc.		29,100		556,683
The AES Corp.		91,296		1,265,362
The Empire District Electric Co.		6,500		149,955
The Laclede Group, Inc.		3,300		154,143
The Southern Co.		130,400		6,289,192
UGI Corp.		16,000		655,680
UIL Holdings Corp.		6,966		290,064
Unitil Corp.		3,600		109,116
UNS Energy Corp.		5,700		290,472
Vectren Corp.		11,366		426,907
Westar Energy, Inc.		18,500		646,760
WGL Holdings, Inc.		7,300		337,406
Wisconsin Energy Corp.		34,600		1,554,924
Xcel Energy, Inc.		72,095		2,291,900
York Water Co.		6,100		114,375
				97,533,466
Total Common Stock
(Cost $1,813,770,978)				2,648,285,384
Rights 0.0% of net assets
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Indevus Pharmaceuticals, Inc. (a)(c)*		1,800		—
Total Rights
(Cost $—)				—
Warrants 0.0% of net assets
Energy 0.0%
Magnum Hunter Resources Corp. (c)*		33		4
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 1.8% of net assets
Time Deposit 1.7%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		46,397,197		46,397,197
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.01%, 06/20/13 (e)(f)		200,000		199,997
0.03%, 06/20/13 (e)(f)		200,000		199,992
0.04%, 06/20/13 (e)(f)		550,000		549,969
0.05%, 06/20/13 (e)(f)		200,000		199,987
0.09%, 06/20/13 (e)(f)		2,000,000		1,999,764
				3,149,709
Total Short-Term Investments
(Cost $49,546,906)				49,546,906
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.7% of net assets
Wells Fargo Advantage Government Money Market Fund		19,140,972		19,140,972
Total Collateral Invested for Securities on Loan
(Cost $19,140,972)				19,140,972
End of collateral invested for securities on loan.

At 04/30/13 tax basis cost of the fund’s investments was $1,877,499,703 and the unrealized appreciation and depreciation were $931,961,728 and ($111,629,137), respectively, with a net unrealized appreciation of $820,332,591.

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(b)	Issuer is affiliated with the fund’s adviser.
(c)	Illiquid security. At the period end, the value of these amounted to $4 or 0.0% of net assets.
(d)	All or a portion of this security is on loan.
(e)	All or a portion of this security is held as collateral for open futures contracts.
(f)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

60 See financial notes

 Schwab Total Stock Market Index Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contracts
Russell 2000 Index, mini, Long, expires 06/21/13		65		6,143,150		89,586
S&P 500 Index, e-mini, Long, expires 06/21/13		550		43,785,500		1,393,351
Net unrealized gains						1,482,937

See financial notes 61

 Schwab International Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	95	.9%	Common Stock		1,271,956,797		1,703,066,687
	0	.5%	Preferred Stock		6,648,095		9,647,033
	0	.0%	Rights		749,437		189,972
	0	.5%	Other Investment Company		8,089,400		8,671,600
	2	.6%	Short-Term Investments		45,804,555		45,804,555
	99	.5%	Total Investments		1,333,248,284		1,767,379,847
	0	.7%	Collateral Invested for Securities on Loan		13,249,645		13,249,645
	(0	.2)%	Other Assets and Liabilities, Net				(4,092,671	)
	100	.0%	Total Net Assets				1,776,536,821

	Number		Value
Security	of Shares		($)
Common Stock 95.9% of net assets
Australia 8.9%
Banks 3.3%
Australia & New Zealand Banking Group Ltd.		389,130		12,859,665
Bendigo & Adelaide Bank Ltd.		58,930		676,339
Commonwealth Bank of Australia		230,333		17,556,180
National Australia Bank Ltd.		332,374		11,728,777
Westpac Banking Corp.		441,047		15,471,941
				58,292,902
Capital Goods 0.0%
Leighton Holdings Ltd.		23,297		483,855
Commercial & Professional Supplies 0.2%
ALS Ltd.		51,222		520,672
Brambles Ltd.		222,764		2,016,855
				2,537,527
Consumer Services 0.1%
Crown Ltd.		58,662		784,952
Echo Entertainment Group Ltd.		100,330		376,538
Flight Centre Ltd.		7,387		292,464
TABCORP Holdings Ltd.		93,458		334,542
Tatts Group Ltd.		198,273		672,385
				2,460,881
Diversified Financials 0.2%
ASX Ltd.		25,393		990,066
Macquarie Group Ltd.		46,607		1,896,052
				2,886,118
Energy 0.5%
Caltex Australia Ltd.		18,421		411,490
Origin Energy Ltd.		154,772		1,981,450
Santos Ltd.		138,627		1,780,673
Whitehaven Coal Ltd.		52,853		106,986
Woodside Petroleum Ltd.		94,696		3,694,440
WorleyParsons Ltd.		30,933		731,306
				8,706,345
Food & Staples Retailing 0.8%
Metcash Ltd.		126,061		534,942
Wesfarmers Ltd.		144,080		6,481,915
Woolworths Ltd.		176,392		6,662,192
				13,679,049
Food, Beverage & Tobacco 0.1%
Coca-Cola Amatil Ltd.		83,605		1,313,399
Treasury Wine Estates Ltd.		86,866		526,489
				1,839,888
Health Care Equipment & Services 0.1%
Cochlear Ltd.		8,137		557,194
Ramsay Health Care Ltd.		19,598		650,776
Sonic Healthcare Ltd.		56,900		782,005
				1,989,975
Insurance 0.5%
AMP Ltd.		413,617		2,318,168
Insurance Australia Group Ltd.		297,586		1,796,702
QBE Insurance Group Ltd.		172,098		2,388,540
Suncorp Group Ltd.		184,160		2,480,320
				8,983,730
Materials 1.6%
Alumina Ltd. *		327,010		327,008
Amcor Ltd.		172,615		1,772,732
BHP Billiton Ltd.		459,710		15,454,975
Boral Ltd.		110,617		574,166
Fortescue Metals Group Ltd.		200,564		732,640
Iluka Resources Ltd.		57,132		530,776
Incitec Pivot Ltd.		230,301		691,029
James Hardie Industries plc CDI		65,076		685,448
Newcrest Mining Ltd.		109,420		1,916,864
Orica Ltd.		52,856		1,253,391
OZ Minerals Ltd.		44,193		198,081
Rio Tinto Ltd.		62,518		3,638,406
Sims Metal Management Ltd.		22,423		224,938
				28,000,454
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
CSL Ltd.		71,800		4,692,337
Real Estate 0.7%
CFS Retail Property Trust Group		279,963		637,954
Dexus Property Group		658,009		787,141
Federation Centres		181,994		490,550
Goodman Group		240,617		1,301,554
GPT Group		194,809		828,824
Lend Lease Group		79,311		886,458
Mirvac Group		490,327		900,407
Stockland		315,281		1,267,023
Westfield Group		305,999		3,701,408

62 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Westfield Retail Trust		414,114		1,415,979
				12,217,298
Retailing 0.0%
Harvey Norman Holdings Ltd.		68,124		212,082
Software & Services 0.0%
Computershare Ltd.		64,473		664,169
Telecommunication Services 0.2%
Telstra Corp., Ltd.		623,370		3,219,553
Transportation 0.2%
Asciano Ltd.		133,090		745,602
Aurizon Holdings Ltd.		251,829		1,084,028
Qantas Airways Ltd. *		148,963		293,573
Sydney Airport		74,602		267,666
Toll Holdings Ltd.		92,053		544,582
Transurban Group		186,650		1,320,420
				4,255,871
Utilities 0.1%
AGL Energy Ltd.		79,288		1,305,584
APA Group		117,803		795,550
SP AusNet		224,108		291,645
				2,392,779
				157,514,813
Austria 0.3%
Banks 0.1%
Erste Group Bank AG *		31,764		995,600
Raiffeisen Bank International AG		6,669		235,416
				1,231,016
Capital Goods 0.1%
Andritz AG		10,635		692,586
Energy 0.1%
OMV AG		20,688		971,811
Insurance 0.0%
Vienna Insurance Group AG Wiener Versicherung Gruppe		5,240		277,481
Materials 0.0%
Voestalpine AG		16,464		516,245
Real Estate 0.0%
Immofinanz AG *		133,179		544,555
Telecommunication Services 0.0%
Telekom Austria AG		29,683		203,614
Utilities 0.0%
Verbund AG		9,608		210,341
				4,647,649
Belgium 1.1%
Banks 0.1%
KBC GROEP N.V.		36,978		1,447,353
Diversified Financials 0.1%
Groupe Bruxelles Lambert S.A.		11,548		893,799
Food & Staples Retailing 0.1%
Colruyt S.A.		10,334		521,937
Delhaize Group S.A.		13,897		869,582
				1,391,519
Food, Beverage & Tobacco 0.5%
Anheuser-Busch InBev N.V.		114,981		11,046,285
Insurance 0.1%
Ageas		32,780		1,200,510
Materials 0.1%
Solvay S.A.		8,422		1,233,925
Umicore S.A.		16,120		747,100
				1,981,025
Media 0.0%
Telenet Group Holding N.V.		7,632		410,446
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
UCB S.A.		15,352		906,048
Telecommunication Services 0.0%
Belgacom S.A. (a)		21,773		501,279
				19,778,264
Denmark 1.1%
Banks 0.1%
Danske Bank A/S *		93,793		1,776,141
Food, Beverage & Tobacco 0.1%
Carlsberg A/S, Class B		15,458		1,437,104
Health Care Equipment & Services 0.1%
Coloplast A/S, Class B		16,501		897,760
William Demant Holding A/S *		3,981		318,758
				1,216,518
Insurance 0.0%
Tryg A/S		3,346		290,009
Materials 0.1%
Novozymes A/S, B Shares		34,874		1,207,029
Pharmaceuticals, Biotechnology & Life Sciences 0.6%
Novo Nordisk A/S, Class B		58,294		10,261,183
Telecommunication Services 0.0%
TDC A/S		91,892		745,706
Transportation 0.1%
AP Moller - Maersk A/S, Series A		79		540,721
AP Moller - Maersk A/S, Series B		191		1,360,110
DSV A/S		25,786		649,513
				2,550,344
				19,484,034
Finland 0.7%
Automobiles & Components 0.1%
Nokian Renkaat Oyj		16,933		735,569
Capital Goods 0.2%
Kone Oyj, Class B		22,155		1,958,247
Metso Oyj		18,759		772,917
Wartsila Oyj Abp		24,128		1,186,461
				3,917,625
Diversified Financials 0.0%
Pohjola Bank plc, A Shares		18,850		320,888
Energy 0.0%
Neste Oil Oyj		17,493		273,167
Food & Staples Retailing 0.0%
Kesko Oyj, B Shares		9,130		274,123

See financial notes 63

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Insurance 0.1%
Sampo Oyj, A Shares		60,050		2,402,894
Materials 0.1%
Stora Enso Oyj, R Shares		79,152		552,006
UPM-Kymmene Oyj		76,671		807,169
				1,359,175
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Orion Oyj, Class B		12,992		373,361
Technology Hardware & Equipment 0.1%
Nokia Oyj (a)		536,040		1,800,926
Telecommunication Services 0.0%
Elisa Oyj		19,292		365,930
Utilities 0.1%
Fortum Oyj		63,202		1,174,766
				12,998,424
France 9.0%
Automobiles & Components 0.2%
Compagnie Generale des Etablissements Michelin		26,090		2,206,221
Peugeot S.A. (a)*		31,040		248,488
Renault S.A.		27,676		1,910,054
				4,364,763
Banks 0.8%
BNP Paribas S.A.		143,573		8,005,328
Credit Agricole S.A. *		142,252		1,303,125
Natixis		131,762		577,577
Societe Generale S.A. *		100,955		3,667,390
				13,553,420
Capital Goods 1.3%
Alstom S.A.		31,079		1,276,357
Bouygues S.A.		27,278		762,226
Compagnie de Saint-Gobain		56,972		2,281,667
European Aeronautic Defence & Space Co., N.V.		65,246		3,447,055
Legrand S.A.		33,863		1,580,338
Rexel S.A.		20,823		458,624
Safran S.A.		32,779		1,611,274
Schneider Electric S.A.		75,311		5,741,457
Thales S.A.		13,384		581,559
Vallourec S.A.		14,880		714,170
Vinci S.A.		65,990		3,181,169
Zodiac Aerospace		4,932		618,763
				22,254,659
Commercial & Professional Supplies 0.1%
Bureau Veritas S.A.		7,907		968,856
Edenred		24,406		813,050
Societe BIC S.A.		3,926		418,672
				2,200,578
Consumer Durables & Apparel 0.4%
Christian Dior S.A.		7,725		1,348,320
LVMH Moet Hennessy Louis Vuitton S.A.		36,334		6,296,124
				7,644,444
Consumer Services 0.1%
Accor S.A.		21,379		707,891
Sodexo		13,250		1,106,479
				1,814,370
Diversified Financials 0.0%
Eurazeo		4,723		250,603
Wendel S.A.		4,484		485,996
				736,599
Energy 1.0%
Compagnie Generale de Geophysique - Veritas *		23,283		503,672
Technip S.A.		14,429		1,547,659
Total S.A.		304,784		15,341,927
				17,393,258
Food & Staples Retailing 0.2%
Carrefour S.A. (a)		86,287		2,562,648
Casino Guichard Perrachon S.A.		8,052		870,936
				3,433,584
Food, Beverage & Tobacco 0.6%
Danone S.A.		82,854		6,319,124
Pernod-Ricard S.A.		30,381		3,763,301
Remy Cointreau S.A.		3,367		391,952
				10,474,377
Health Care Equipment & Services 0.2%
Essilor International S.A.		29,000		3,267,502
Household & Personal Products 0.4%
L’Oreal S.A.		34,801		6,211,656
Insurance 0.3%
AXA S.A.		253,106		4,739,822
CNP Assurances		23,314		330,438
SCOR SE		23,570		715,342
				5,785,602
Materials 0.6%
Air Liquide S.A.		44,683		5,661,165
ArcelorMittal		141,232		1,745,716
Arkema S.A.		9,128		855,730
Imerys S.A.		4,634		305,104
Lafarge S.A.		26,504		1,715,792
				10,283,507
Media 0.3%
Eutelsat Communications S.A.		19,367		699,786
JC Decaux S.A.		9,072		249,598
Lagardere S.C.A.		17,248		641,073
Publicis Groupe S.A.		25,682		1,785,883
SES S.A.		43,578		1,359,149
				4,735,489
Pharmaceuticals, Biotechnology & Life Sciences 1.0%
Sanofi		170,501		18,433,806
Real Estate 0.3%
Fonciere des Regions		3,999		319,071
Gecina S.A.		2,992		360,540
ICADE		3,182		294,148
Klepierre		14,999		636,485
Unibail-Rodamco SE		13,202		3,451,197
				5,061,441
Retailing 0.1%
PPR		10,779		2,374,300

64 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Semiconductors & Semiconductor Equipment 0.0%
STMicroelectronics N.V.		91,234		793,825
Software & Services 0.2%
AtoS		8,095		563,928
Cap Gemini S.A.		21,938		1,011,476
Dassault Systemes S.A.		9,002		1,098,940
				2,674,344
Technology Hardware & Equipment 0.1%
Gemalto N.V.		11,304		924,020
Telecommunication Services 0.4%
France Telecom S.A.		262,185		2,799,973
Iliad S.A.		3,252		743,481
Vivendi S.A.		189,446		4,291,309
				7,834,763
Transportation 0.1%
Aeroports de Paris		4,137		374,444
Groupe Eurotunnel S.A. - Reg’d		80,583		675,143
				1,049,587
Utilities 0.3%
EDF S.A.		35,022		784,067
GDF Suez		189,875		4,070,976
Suez Environnement Co.		38,178		547,900
Veolia Environnement S.A.		49,105		679,240
				6,082,183
				159,382,077
Germany 7.4%
Automobiles & Components 0.8%
Bayerische Motoren Werke AG		47,392		4,382,343
Continental AG		15,505		1,844,286
Daimler AG - Reg’d		129,861		7,200,149
Volkswagen AG		4,258		829,621
				14,256,399
Banks 0.0%
Commerzbank AG (a)*		54,237		732,028
Capital Goods 0.9%
Brenntag AG		7,503		1,281,221
GEA Group AG		26,295		891,027
Hochtief AG *		4,149		288,671
MAN SE		6,085		682,706
Siemens AG - Reg’d		119,798		12,517,335
				15,660,960
Consumer Durables & Apparel 0.2%
Adidas AG		29,996		3,136,599
Hugo Boss AG		3,434		400,230
				3,536,829
Diversified Financials 0.4%
Deutsche Bank AG - Reg’d		133,045		6,124,465
Deutsche Boerse AG		27,601		1,724,954
				7,849,419
Food & Staples Retailing 0.0%
Metro AG		19,006		593,618
Food, Beverage & Tobacco 0.0%
Suedzucker AG		11,975		483,107
Health Care Equipment & Services 0.3%
Celesio AG		11,605		229,790
Fresenius Medical Care AG & Co KGaA		29,914		2,060,949
Fresenius SE & Co KGaA		17,840		2,238,078
				4,528,817
Household & Personal Products 0.2%
Beiersdorf AG		14,314		1,296,594
Henkel AG & Co. KGaA		18,574		1,455,896
				2,752,490
Insurance 0.9%
Allianz SE - Reg’d		65,263		9,653,737
Hannover Rueckversicherung AG - Reg’d		8,744		739,796
Muenchener Rueckversicherungs-Gesellschaft AG - Reg’d		25,670		5,141,862
				15,535,395
Materials 1.2%
BASF SE		131,468		12,307,057
HeidelbergCement AG		20,262		1,462,682
K&S AG - Reg’d		24,644		1,091,002
Lanxess AG		12,146		887,038
Linde AG		26,497		5,017,034
Salzgitter AG		5,330		209,795
ThyssenKrupp AG *		54,694		991,532
				21,966,140
Media 0.1%
Axel Springer AG (a)		5,400		227,872
Kabel Deutschland Holding AG		12,627		1,198,676
				1,426,548
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
Bayer AG - Reg’d		118,366		12,374,744
Merck KGaA		9,323		1,420,328
QIAGEN N.V. *		33,846		670,904
				14,465,976
Semiconductors & Semiconductor Equipment 0.1%
Infineon Technologies AG		154,144		1,219,300
Software & Services 0.6%
SAP AG		131,865		10,512,533
United Internet AG - Reg’d		14,474		397,415
				10,909,948
Telecommunication Services 0.3%
Deutsche Telekom AG - Reg’d		402,050		4,761,938
Transportation 0.2%
Deutsche Lufthansa AG - Reg’d		33,431		669,368
Deutsche Post AG - Reg’d		128,689		3,059,058
Fraport AG Frankfurt Airport Services Worldwide		5,014		299,997
				4,028,423
Utilities 0.4%
E.ON SE AG		257,775		4,681,334
RWE AG		70,272		2,532,551
				7,213,885
				131,921,220

See financial notes 65

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Greece 0.1%
Consumer Services 0.0%
OPAP S.A.		30,470		300,359
Food, Beverage & Tobacco 0.1%
Coca Cola Hellenic Bottling Co., S.A. *		28,832		711,184
Telecommunication Services 0.0%
Hellenic Telecommunications Organization S.A. (OTE) *		35,000		304,216
				1,315,759
Hong Kong 3.0%
Banks 0.3%
Bank of East Asia Ltd.		181,600		748,236
BOC Hong Kong (Holdings) Ltd.		523,000		1,802,353
Hang Seng Bank Ltd.		111,136		1,861,576
Wing Hang Bank Ltd.		29,500		310,315
				4,722,480
Capital Goods 0.2%
Hopewell Holdings Ltd.		84,500		327,077
Hutchison Whampoa Ltd.		305,370		3,322,186
NWS Holdings Ltd.		192,000		343,285
				3,992,548
Consumer Durables & Apparel 0.0%
Yue Yuen Industrial Holdings Ltd.		105,500		365,627
Consumer Services 0.3%
Galaxy Entertainment Group Ltd. *		297,000		1,333,355
MGM China Holdings Ltd.		128,400		303,099
Sands China Ltd.		356,800		1,876,040
Shangri-La Asia Ltd.		224,000		433,977
SJM Holdings Ltd.		278,000		701,845
Wynn Macau Ltd. *		212,000		644,790
				5,293,106
Diversified Financials 0.2%
First Pacific Co., Ltd.		282,000		390,561
Hong Kong Exchanges & Clearing Ltd.		156,118		2,633,017
				3,023,578
Insurance 0.4%
AIA Group Ltd.		1,724,000		7,669,139
Real Estate 1.0%
Cheung Kong (Holdings) Ltd.		200,656		3,028,243
Hang Lung Properties Ltd.		316,000		1,230,405
Henderson Land Development Co., Ltd.		138,000		1,001,404
Hysan Development Co., Ltd.		87,000		432,066
Kerry Properties Ltd.		98,000		444,663
New World Development Co., Ltd.		529,000		924,741
Sino Land Co., Ltd.		416,000		685,538
Sun Hung Kai Properties Ltd.		225,604		3,262,254
Swire Pacific Ltd., Class A		98,090		1,248,213
Swire Properties Ltd.		169,000		604,231
The Link REIT		323,500		1,833,855
Wharf Holdings Ltd.		216,100		1,930,226
Wheelock & Co., Ltd.		132,000		735,574
				17,361,413
Retailing 0.1%
Li & Fung Ltd.		828,000		1,074,627
Semiconductors & Semiconductor Equipment 0.0%
ASM Pacific Technology Ltd.		32,000		330,429
Telecommunication Services 0.0%
HKT Trust & HKT Ltd.		301,000		316,242
PCCW Ltd.		536,000		273,112
				589,354
Transportation 0.1%
Cathay Pacific Airways Ltd.		169,000		297,882
MTR Corp., Ltd.		207,000		854,463
Orient Overseas International Ltd.		30,000		178,567
				1,330,912
Utilities 0.4%
Cheung Kong Infrastructure Holdings Ltd.		77,000		559,190
CLP Holdings Ltd.		251,580		2,219,038
Hong Kong & China Gas Co., Ltd.		746,031		2,247,138
Power Assets Holdings Ltd.		199,000		1,945,983
				6,971,349
				52,724,562
Ireland 0.2%
Food, Beverage & Tobacco 0.1%
Kerry Group plc, Class A		21,190		1,253,267
Materials 0.1%
CRH plc		103,938		2,238,161
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Elan Corp. plc *		73,229		847,636
Transportation 0.0%
Ryanair Holdings plc		25,968		202,090
				4,541,154
Israel 0.5%
Banks 0.1%
Bank Hapoalim B.M. *		144,407		671,746
Bank Leumi Le-Israel B.M. *		177,105		629,505
Mizrahi Tefahot Bank Ltd. *		16,863		172,517
				1,473,768
Energy 0.0%
Delek Group Ltd.		790		208,285
Materials 0.1%
Israel Chemicals Ltd.		62,967		750,346
The Israel Corp., Ltd. *		316		203,487
				953,833
Pharmaceuticals, Biotechnology & Life Sciences 0.3%
Teva Pharmaceutical Industries Ltd.		127,622		4,899,862
Semiconductors & Semiconductor Equipment 0.0%
Mellanox Technologies Ltd. *		4,792		251,040
Software & Services 0.0%
NICE Systems Ltd. *		8,174		289,940

66 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Telecommunication Services 0.0%
Bezeq Israeli Telecommunication Corp., Ltd.		271,806		394,802
				8,471,530
Italy 2.0%
Automobiles & Components 0.1%
Fiat S.p.A. *		125,442		751,702
Pirelli & C. S.p.A.		33,866		352,241
				1,103,943
Banks 0.4%
Banca Monte dei Paschi di Siena S.p.A. (a)*		860,993		242,970
Banco Popolare Scarl *		229,087		330,932
Intesa Sanpaolo S.p.A.		1,442,220		2,619,240
Intesa Sanpaolo S.p.A. - RSP		124,963		196,110
UniCredit S.p.A. *		579,843		3,030,629
Unione di Banche Italiane S.C.P.A.		122,619		512,819
				6,932,700
Capital Goods 0.1%
Fiat Industrial S.p.A.		122,546		1,383,825
Finmeccanica S.p.A. *		58,072		302,502
Prysmian S.p.A.		30,520		616,035
				2,302,362
Consumer Durables & Apparel 0.1%
Luxottica Group S.p.A.		24,024		1,244,305
Diversified Financials 0.0%
Exor S.p.A.		10,760		326,031
Mediobanca S.p.A.		76,417		486,367
				812,398
Energy 0.6%
Eni S.p.A.		364,129		8,690,452
Saipem S.p.A.		39,147		1,110,844
Tenaris S.A.		68,664		1,530,823
				11,332,119
Insurance 0.2%
Assicurazioni Generali S.p.A.		168,403		3,092,849
Telecommunication Services 0.1%
Telecom Italia S.p.A.		1,327,993		1,127,997
Telecom Italia S.p.A. - RSP		808,777		561,712
				1,689,709
Transportation 0.1%
Atlantia S.p.A.		47,830		855,130
Utilities 0.3%
Enel Green Power S.p.A.		231,830		494,544
Enel S.p.A.		942,175		3,643,747
Snam S.p.A.		235,423		1,158,545
Terna - Rete Elettrica Nationale S.p.A.		183,741		860,024
				6,156,860
				35,522,375
Japan 21.3%
Automobiles & Components 3.0%
Aisin Seiki Co., Ltd.		27,700		999,881
Bridgestone Corp.		93,357		3,523,609
Daihatsu Motor Co., Ltd.		28,000		555,429
Denso Corp.		70,000		3,138,845
Fuji Heavy Industries Ltd.		84,000		1,585,540
Honda Motor Co., Ltd.		233,339		9,310,801
Isuzu Motors Ltd.		170,000		1,132,936
Koito Manufacturing Co., Ltd.		13,000		251,494
Mazda Motor Corp. *		382,000		1,308,900
Mitsubishi Motors Corp. *		580,000		685,141
NGK Spark Plug Co., Ltd.		26,000		438,329
NHK Spring Co., Ltd.		23,800		257,624
Nissan Motors Co., Ltd.		355,896		3,712,813
NOK Corp.		14,200		204,773
Stanley Electric Co., Ltd.		19,800		379,755
Sumitomo Rubber Industries Ltd.		23,400		432,083
Suzuki Motor Corp.		52,700		1,354,189
Toyoda Gosei Co., Ltd.		8,800		228,385
Toyota Boshoku Corp.		14,000		201,230
Toyota Industries Corp.		24,100		986,844
Toyota Motor Corp.		394,803		22,913,505
Yamaha Motor Co., Ltd.		38,200		532,906
				54,135,012
Banks 2.3%
Aozora Bank Ltd.		155,000		485,630
Fukuoka Financial Group, Inc.		106,000		542,266
Mitsubishi UFJ Financial Group, Inc.		1,823,909		12,374,930
Mizuho Financial Group, Inc.		3,271,434		7,198,649
Resona Holdings, Inc.		266,700		1,423,572
Seven Bank Ltd.		76,700		272,356
Shinsei Bank Ltd.		203,000		569,760
Sumitomo Mitsui Financial Group, Inc.		192,246		9,086,954
Sumitomo Mitsui Trust Holdings, Inc.		441,000		2,216,248
Suruga Bank Ltd.		25,000		442,303
The Bank of Kyoto Ltd.		44,000		462,933
The Bank of Yokohama Ltd.		175,000		1,064,657
The Chiba Bank Ltd.		104,000		807,523
The Chugoku Bank Ltd.		24,000		418,463
The Gunma Bank Ltd.		52,000		330,812
The Hachijuni Bank Ltd.		57,000		388,077
The Hiroshima Bank Ltd.		67,000		353,197
The Iyo Bank Ltd.		37,000		387,524
The Joyo Bank Ltd.		91,000		559,376
The Nishi-Nippon City Bank Ltd.		91,000		303,576
The Shizuoka Bank Ltd.		74,000		905,789
Yamaguchi Financial Group, Inc.		28,000		304,076
				40,898,671
Capital Goods 2.7%
Amada Co., Ltd.		49,000		393,189
Asahi Glass Co., Ltd.		144,000		1,131,439
Chiyoda Corp.		21,000		215,900
Daikin Industries Ltd.		33,500		1,345,266
Fanuc Corp.		27,400		4,136,088
Fuji Electric Co., Ltd.		75,000		256,619
Furukawa Electric Co., Ltd.		91,000		230,282
GS Yuasa Corp.		40,000		169,575
Hino Motors Ltd.		38,000		580,445
Hitachi Construction Machinery Co., Ltd.		14,600		347,312

See financial notes 67

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
IHI Corp.		187,000		697,311
Itochu Corp.		215,500		2,672,080
JGC Corp.		31,000		918,572
JTEKT Corp.		30,300		308,950
Kajima Corp.		111,000		354,435
Kawasaki Heavy Industries Ltd.		203,000		647,352
Kinden Corp.		30,000		218,867
Komatsu Ltd.		133,309		3,652,396
Kubota Corp.		155,000		2,226,376
Kurita Water Industries Ltd.		15,400		316,145
LIXIL Group Corp.		38,400		863,284
Mabuchi Motor Co., Ltd.		3,300		179,182
Makita Corp.		16,600		1,012,567
Marubeni Corp.		236,000		1,694,066
Mitsubishi Corp.		201,700		3,631,055
Mitsubishi Electric Corp.		277,000		2,640,748
Mitsubishi Heavy Industries Ltd.		435,000		2,999,782
Mitsui & Co., Ltd.		247,100		3,404,212
Nabtesco Corp.		15,700		346,458
NGK Insulators Ltd.		40,000		483,485
Nidec Corp.		16,000		1,088,098
NSK Ltd.		60,000		485,372
Obayashi Corp.		93,000		572,198
Shimizu Corp.		77,000		309,910
SMC Corp.		7,800		1,563,686
Sojitz Corp.		168,000		263,774
Sumitomo Corp.		161,100		2,016,816
Sumitomo Electric Industries Ltd.		107,600		1,430,936
Sumitomo Heavy Industries Ltd.		74,000		329,503
Taisei Corp.		134,000		447,565
The Japan Steel Works Ltd.		43,000		218,458
THK Co., Ltd.		16,400		345,404
TOTO Ltd.		40,000		414,852
Toyota Tsusho Corp.		31,200		868,968
Ushio, Inc.		14,300		145,704
				48,574,682
Commercial & Professional Supplies 0.2%
Dai Nippon Printing Co., Ltd.		80,000		783,331
Park24 Co., Ltd.		13,100		264,331
Secom Co., Ltd.		30,400		1,695,535
Toppan Printing Co., Ltd.		76,000		579,080
				3,322,277
Consumer Durables & Apparel 0.7%
Asics Corp.		22,200		400,770
Casio Computer Co., Ltd.		32,000		265,130
Namco Bandai Holdings, Inc.		26,300		479,355
Nikon Corp.		49,800		1,083,952
Panasonic Corp. *		316,012		2,277,459
Rinnai Corp.		4,400		349,869
Sankyo Co., Ltd.		7,600		346,389
Sega Sammy Holdings, Inc.		29,500		775,070
Sekisui Chemical Co., Ltd.		59,000		742,960
Sekisui House Ltd.		78,000		1,169,168
Sharp Corp. (a)*		142,785		495,762
Shimano, Inc.		10,900		949,441
Sony Corp.		144,000		2,367,070
Yamaha Corp.		22,000		235,918
				11,938,313
Consumer Services 0.1%
Benesse Holdings, Inc.		9,200		407,744
McDonald’s Holdings Co., Ltd.		9,000		262,471
Oriental Land Co., Ltd.		7,200		1,164,027
				1,834,242
Diversified Financials 0.7%
Acom Co., Ltd. *		8,881		363,884
AEON Financial Service Co., Ltd.		9,900		296,812
Credit Saison Co., Ltd.		21,900		640,610
Daiwa Securities Group, Inc.		236,000		2,093,946
Japan Exchange Group, Inc.		7,406		909,087
Mitsubishi UFJ Lease & Finance Co., Ltd.		79,500		449,063
Nomura Holdings, Inc.		519,800		4,248,171
ORIX Corp.		150,400		2,307,784
SBI Holdings, Inc.		30,590		592,561
				11,901,918
Energy 0.3%
Cosmo Oil Co., Ltd. *		74,000		176,734
Idemitsu Kosan Co., Ltd.		3,000		253,800
Inpex Corp.		316		1,529,221
Japan Petroleum Exploration Co.		3,900		154,860
JX Holdings, Inc.		316,000		1,715,834
Showa Shell Sekiyu K.K.		33,500		268,874
TonenGeneral Sekiyu K.K.		39,000		394,111
				4,493,434
Food & Staples Retailing 0.4%
Aeon Co., Ltd.		86,500		1,224,611
FamilyMart Co., Ltd.		9,000		411,305
Lawson, Inc.		9,000		708,608
Seven & I Holdings Co., Ltd.		107,803		4,146,767
				6,491,291
Food, Beverage & Tobacco 0.8%
Ajinomoto Co., Inc.		94,000		1,290,094
Asahi Group Holdings Ltd.		56,200		1,397,556
Calbee, Inc.		2,200		217,507
Coca-Cola West Co., Ltd.		13,303		247,422
Japan Tobacco, Inc.		157,500		5,953,692
Kikkoman Corp.		25,000		474,524
Kirin Holdings Co., Ltd.		123,000		2,152,373
Meiji Holdings Co., Ltd.		8,400		379,210
Nippon Meat Packers, Inc.		23,000		353,209
Nisshin Seifun Group, Inc.		25,500		329,467
Nissin Food Holdings Co., Ltd.		8,000		358,839
Toyo Suisan Kaisha Ltd.		13,000		441,811
Yakult Honsha Co., Ltd.		14,600		636,391
Yamazaki Baking Co., Ltd.		14,000		183,211
				14,415,306
Health Care Equipment & Services 0.2%
Alfresa Holdings Corp.		6,400		380,760
M3, Inc.		100		226,181
Medipal Holdings Corp.		20,000		313,802
Miraca Holdings, Inc.		7,600		378,988
Olympus Corp. *		29,000		728,125
Suzuken Co., Ltd.		11,500		447,815
Sysmex Corp.		10,700		690,048
Terumo Corp.		22,500		1,117,810
				4,283,529
Household & Personal Products 0.2%
Kao Corp.		74,919		2,590,551
Shiseido Co., Ltd.		51,700		740,311

68 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Unicharm Corp.		16,500		1,066,913
				4,397,775
Insurance 0.5%
MS&AD Insurance Group Holdings, Inc.		72,262		1,938,838
NKSJ Holdings, Inc.		54,500		1,383,272
Sony Financial Holdings, Inc.		23,700		334,811
T&D Holdings, Inc.		83,700		974,958
The Dai-ichi Life Insurance Co., Ltd.		1,204		1,659,675
Tokio Marine Holdings, Inc.		99,699		3,168,400
				9,459,954
Materials 1.3%
Nippon Steel & Sumitomo Metal Corp.		1,088,410		2,898,952
Air Water, Inc.		20,000		323,845
Asahi Kasei Corp.		181,000		1,216,745
Daicel Corp.		40,000		322,832
Daido Steel Co., Ltd.		39,000		212,565
Denki Kagaku Kogyo K.K.		54,000		197,556
Hitachi Chemical Co., Ltd.		14,200		222,608
Hitachi Metals Ltd.		22,000		227,448
JFE Holdings, Inc.		69,900		1,517,663
JSR Corp.		26,300		605,427
Kaneka Corp.		38,000		228,918
Kansai Paint Co., Ltd.		30,000		384,956
Kobe Steel Ltd. *		334,000		436,230
Kuraray Co., Ltd.		49,800		756,302
Maruichi Steel Tube Ltd.		6,400		161,840
Mitsubishi Chemical Holdings Corp.		194,000		946,161
Mitsubishi Gas Chemical Co., Inc.		53,000		405,209
Mitsubishi Materials Corp.		147,000		421,656
Mitsui Chemicals, Inc.		117,000		270,765
Nippon Paper Industries Co., Ltd. (a)*		13,500		202,213
Nitto Denko Corp.		24,000		1,576,788
Oji Holdings Corp.		104,000		371,217
Shin-Etsu Chemical Co., Ltd.		58,760		3,961,152
Showa Denko K.K.		191,000		308,416
Sumitomo Chemical Co., Ltd.		214,000		716,617
Sumitomo Metal Mining Co., Ltd.		75,000		1,049,949
Taiheiyo Cement Corp.		163,000		423,329
Taiyo Nippon Sanso Corp.		36,000		239,211
Teijin Ltd.		126,000		303,565
Toray Industries, Inc.		209,000		1,469,378
Toyo Seikan Kaisha Ltd.		20,700		283,679
Ube Industries Ltd.		144,000		291,154
Yamato Kogyo Co., Ltd.		5,700		188,525
				23,142,871
Media 0.1%
Dentsu, Inc.		26,600		924,707
Hakuhodo DY Holdings, Inc.		3,180		262,075
Toho Co., Ltd.		15,500		344,641
				1,531,423
Pharmaceuticals, Biotechnology & Life Sciences 1.2%
Astellas Pharma, Inc.		63,570		3,705,181
Chugai Pharmaceutical Co., Ltd.		32,100		799,204
Daiichi Sankyo Co., Ltd.		95,300		1,864,708
Dainippon Sumitomo Pharma Co., Ltd.		21,800		400,408
Eisai Co., Ltd.		36,500		1,665,646
Hisamitsu Pharmaceutical Co., Inc.		9,100		535,069
Kyowa Hakko Kirin Co., Ltd.		37,000		454,155
Mitsubishi Tanabe Pharma Corp.		31,000		471,551
Ono Pharmaceutical Co., Ltd.		12,200		804,625
Otsuka Holdings Co., Ltd.		51,500		1,857,208
Santen Pharmaceutical Co., Ltd.		10,900		547,125
Shionogi & Co., Ltd.		42,800		1,052,749
Taisho Pharmaceutical Holdings Co., Ltd.		5,000		370,720
Takeda Pharmaceutical Co., Ltd.		113,000		6,203,898
Tsumura & Co.		8,200		267,940
				21,000,187
Real Estate 1.2%
Aeon Mall Co., Ltd.		9,900		318,738
Daito Trust Construction Co., Ltd.		10,600		1,027,787
Daiwa House Industry Co., Ltd.		74,000		1,672,553
Hulic Co., Ltd.		37,900		421,487
Japan Prime Realty Investment Corp.		121		444,643
Japan Real Estate Investment Corp.		87		1,168,706
Japan Retail Fund Investment Corp.		299		708,773
Mitsubishi Estate Co., Ltd.		179,502		5,846,579
Mitsui Fudosan Co., Ltd.		119,777		4,076,373
Nippon Building Fund, Inc.		99		1,426,425
Nomura Real Estate Holdings, Inc.		17,500		470,467
Nomura Real Estate Office Fund, Inc.		37		236,411
NTT Urban Development Corp.		155		229,812
Sumitomo Realty & Development Co., Ltd.		51,000		2,410,329
Tokyu Land Corp.		61,000		749,999
				21,209,082
Retailing 0.5%
ABC-Mart, Inc.		5,980		224,013
Don Quijote Co., Ltd.		8,500		463,165
Fast Retailing Co., Ltd.		7,600		2,787,027
Isetan Mitsukoshi Holdings Ltd.		50,900		811,238
J. Front Retailing Co., Ltd.		74,000		621,693
Marui Group Co., Ltd.		30,000		348,230
Nitori Holdings Co., Ltd.		5,300		399,846
Rakuten, Inc.		106,120		1,131,913
Sanrio Co., Ltd.		6,100		306,287
Shimamura Co., Ltd.		3,300		417,059
Takashimaya Co., Ltd.		36,000		425,533
USS Co., Ltd.		2,990		383,571
Yamada Denki Co., Ltd.		13,100		632,186
				8,951,761
Semiconductors & Semiconductor Equipment 0.1%
Advantest Corp.		20,400		305,649
Rohm Co., Ltd.		14,300		505,528
Sumco Corp.		15,800		165,851
Tokyo Electron Ltd.		24,600		1,259,131
				2,236,159
Software & Services 0.3%
Dena Co., Ltd. (a)		15,600		444,383

See financial notes 69

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Gree, Inc. (a)		13,000		166,627
Itochu Techno-Solutions Corp.		5,206		247,740
Konami Corp.		15,600		355,860
Nexon Co., Ltd.		15,000		182,117
Nintendo Co., Ltd.		15,239		1,681,968
Nomura Research Institute Ltd.		13,800		415,693
NTT Data Corp.		183		579,394
Oracle Corp., Japan		5,200		222,773
Otsuka Corp.		2,200		228,062
Trend Micro, Inc.		14,500		406,534
Yahoo Japan Corp.		2,093		1,051,711
				5,982,862
Technology Hardware & Equipment 1.8%
Brother Industries Ltd.		32,200		368,244
Canon, Inc.		162,295		5,836,858
Citizen Holdings Co., Ltd.		36,000		212,975
FUJIFILM Holdings Corp.		66,111		1,358,153
Fujitsu Ltd.		266,000		1,117,221
Hamamatsu Photonics K.K.		11,300		465,896
Hirose Electric Co., Ltd.		4,600		661,432
Hitachi High-Technologies Corp.		8,400		209,843
Hitachi Ltd.		674,079		4,307,933
Hoya Corp.		62,407		1,250,407
Ibiden Co., Ltd.		16,500		289,227
Keyence Corp.		6,500		2,062,748
Konica Minolta Holdings, Inc.		65,500		462,749
Kyocera Corp.		22,000		2,237,896
Murata Manufacturing Co., Ltd.		29,274		2,383,890
NEC Corp.		373,000		968,981
Nippon Electric Glass Co., Ltd.		54,000		275,627
Omron Corp.		30,000		947,696
Ricoh Co., Ltd.		90,000		1,001,439
Shimadzu Corp.		32,000		233,822
TDK Corp.		18,400		672,827
Toshiba Corp.		576,178		3,177,146
Yaskawa Electric Corp.		29,000		354,835
Yokogawa Electric Corp.		29,300		297,952
				31,155,797
Telecommunication Services 1.0%
KDDI Corp.		77,400		3,721,959
Nippon Telegraph & Telephone Corp.		62,678		3,116,986
NTT DoCoMo, Inc.		2,191		3,628,072
Softbank Corp.		135,600		6,724,937
				17,191,954
Transportation 1.1%
ANA Holdings, Inc. (a)		152,000		331,061
Central Japan Railway Co.		20,600		2,484,428
East Japan Railway Co.		48,260		4,073,950
Hankyu Hanshin Holdings, Inc.		164,000		1,061,940
Japan Airlines Co., Ltd.		9,200		467,185
Kamigumi Co., Ltd.		34,000		318,809
Keikyu Corp.		68,000		752,510
Keio Corp.		84,000		722,553
Keisei Electric Railway Co., Ltd.		38,000		401,766
Kintetsu Corp. (a)		230,000		1,163,387
Mitsubishi Logistics Corp.		18,000		321,785
Mitsui O.S.K. Lines, Ltd. *		146,000		607,992
Nippon Express Co., Ltd.		125,000		650,616
Nippon Yusen K.K.		217,000		566,490
Odakyu Electric Railway Co., Ltd.		90,000		1,083,869
Tobu Railway Co., Ltd.		146,000		848,732
Tokyu Corp.		161,000		1,276,750
West Japan Railway Co.		24,400		1,180,528
Yamato Holdings Co., Ltd.		54,100		1,043,586
				19,357,937
Utilities 0.6%
Chubu Electric Power Co., Inc.		93,600		1,211,750
Electric Power Development Co., Ltd.		15,900		454,104
Hokkaido Electric Power Co., Inc. *		25,000		317,218
Hokuriku Electric Power Co.		23,000		339,212
Kyushu Electric Power Co., Inc. *		61,700		852,286
Osaka Gas Co., Ltd.		266,000		1,152,849
Shikoku Electric Power Co., Inc. *		22,900		415,105
The Chugoku Electric Power Co., Inc.		43,300		621,502
The Kansai Electric Power Co., Inc. *		108,300		1,323,137
Toho Gas Co., Ltd.		56,000		333,890
Tohoku Electric Power Co., Inc. *		65,400		700,465
Tokyo Electric Power Co., Inc. *		206,990		916,261
Tokyo Gas Co., Ltd.		349,201		1,993,290
				10,631,069
				378,537,506
Netherlands 2.3%
Capital Goods 0.2%
Koninklijke Boskalis Westminster N.V.		11,059		461,367
Koninklijke Philips Electronics N.V.		137,001		3,791,919
				4,253,286
Commercial & Professional Supplies 0.0%
Randstad Holding N.V.		16,684		695,462
Diversified Financials 0.3%
ING Groep N.V. CVA *		548,245		4,516,355
Energy 0.0%
Fugro N.V. CVA		9,440		545,407
Food & Staples Retailing 0.1%
Koninklijke Ahold N.V.		144,273		2,279,111
Food, Beverage & Tobacco 0.8%
DE Master Blenders 1753 N.V. *		80,000		1,268,487
Heineken Holding N.V.		14,255		858,966
Heineken N.V.		32,979		2,334,080
Unilever N.V. CVA		233,168		9,935,601
				14,397,134
Insurance 0.1%
Aegon N.V.		249,208		1,664,647
Delta Lloyd N.V.		24,612		473,247
				2,137,894
Materials 0.2%
Akzo Nobel N.V.		34,353		2,071,842
Koninklijke DSM N.V.		21,696		1,398,431
				3,470,273
Media 0.2%
Reed Elsevier N.V.		98,376		1,596,723

70 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Wolters Kluwer N.V.		42,839		947,965
				2,544,688
Real Estate 0.0%
Corio N.V.		10,200		472,398
Semiconductors & Semiconductor Equipment 0.2%
ASML Holding N.V.		45,122		3,357,660
Telecommunication Services 0.1%
Koninklijke (Royal) KPN N.V. (a)		136,326		285,662
Ziggo N.V.		17,266		617,450
				903,112
Transportation 0.1%
Koninklijke Vopak N.V.		10,102		559,423
TNT Express N.V.		44,319		340,520
				899,943
				40,472,723
New Zealand 0.1%
Consumer Services 0.0%
SKYCITY Entertainment Group Ltd.		78,727		301,142
Materials 0.1%
Fletcher Building Ltd.		105,435		799,879
Telecommunication Services 0.0%
Telecom Corp. of New Zealand Ltd.		247,415		552,480
Transportation 0.0%
Auckland International Airport Ltd.		126,326		335,791
Utilities 0.0%
Contact Energy Ltd.		54,983		248,838
				2,238,130
Norway 0.8%
Banks 0.1%
DnB A.S.A.		139,895		2,290,852
Energy 0.4%
Aker Solutions A.S.A. (a)		23,152		324,033
Seadrill Ltd.		49,766		1,917,664
Statoil A.S.A.		159,744		3,910,750
Subsea 7 S.A.		40,801		880,823
				7,033,270
Food, Beverage & Tobacco 0.1%
Orkla A.S.A.		109,976		991,688
Insurance 0.0%
Gjensidige Forsikring A.S.A. (a)		27,290		440,104
Materials 0.1%
Norsk Hydro A.S.A.		133,267		627,636
Yara International A.S.A.		26,533		1,246,359
				1,873,995
Telecommunication Services 0.1%
Telenor A.S.A.		101,480		2,286,845
				14,916,754
Portugal 0.2%
Banks 0.0%
Banco Espirito Santo, S.A. - Reg’d *		269,627		308,937
Energy 0.0%
Galp Energia, SGPS, S.A.		41,819		670,222
Food & Staples Retailing 0.1%
Jeronimo Martins, SGPS, S.A.		31,405		747,974
Telecommunication Services 0.0%
Portugal Telecom, SGPS, S.A. - Reg’d		86,110		449,306
Utilities 0.1%
EDP - Energias de Portugal S.A.		273,182		938,927
				3,115,366
Singapore 1.7%
Banks 0.6%
DBS Group Holdings Ltd.		262,246		3,577,368
Oversea-Chinese Banking Corp., Ltd.		371,552		3,280,054
United Overseas Bank Ltd.		181,233		3,149,339
				10,006,761
Capital Goods 0.2%
Keppel Corp., Ltd.		207,800		1,812,586
Noble Group Ltd.		549,000		503,593
SembCorp Industries Ltd.		134,000		544,531
SembCorp Marine Ltd. (a)		125,000		439,146
Singapore Technologies Engineering Ltd.		220,000		787,390
Yangzijiang Shipbuilding Holdings Ltd.		221,000		171,131
				4,258,377
Consumer Services 0.1%
Genting Singapore plc		863,000		1,078,488
Diversified Financials 0.1%
Singapore Exchange Ltd.		131,000		797,700
Food & Staples Retailing 0.0%
Olam International Ltd. (a)		200,000		273,298
Food, Beverage & Tobacco 0.1%
Golden Agri-Resources Ltd.		1,055,000		454,621
Wilmar International Ltd.		265,000		719,346
				1,173,967
Media 0.0%
Singapore Press Holdings Ltd.		220,000		797,292
Real Estate 0.3%
Ascendas REIT		288,000		644,844
CapitaCommercial Trust		267,000		371,766
CapitaLand Ltd.		378,000		1,152,767
CapitaMall Trust		330,000		622,233
CapitaMalls Asia Ltd.		195,000		333,413
City Developments Ltd.		74,000		678,434
Global Logistic Properties Ltd.		336,000		756,228
Keppel Land Ltd.		102,000		336,990
Keppel REIT		41,560		51,005

See financial notes 71

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
UOL Group Ltd.		63,000		365,786
				5,313,466
Retailing 0.0%
Jardine Cycle & Carriage Ltd.		16,000		634,152
Telecommunication Services 0.2%
Singapore Telecommunications Ltd.		1,141,237		3,645,455
StarHub Ltd.		108,000		415,313
				4,060,768
Transportation 0.1%
ComfortDelGro Corp., Ltd.		257,000		414,663
Hutchison Port Holdings Trust, Class U		739,000		614,448
Singapore Airlines Ltd.		79,000		713,377
				1,742,488
				30,136,757
Spain 2.8%
Banks 1.2%
Banco Bilbao Vizcaya Argentaria S.A.		779,929		7,592,270
Banco de Sabadell S.A.		381,049		791,555
Banco Popular Espanol S.A.		782,315		609,109
Banco Santander S.A.		1,508,470		10,893,486
Bankia S.A. (a)*		4,193		22,088
CaixaBank		156,278		577,846
				20,486,354
Capital Goods 0.1%
ACS, Actividades de Construccion y Servicios S.A.		19,321		496,224
Ferrovial S.A.		58,598		969,355
Zardoya Otis S.A.		22,153		309,506
				1,775,085
Energy 0.2%
Repsol S.A.		118,829		2,785,893
Food & Staples Retailing 0.0%
Distribuidora Internacional de Alimentacion S.A.		89,907		696,907
Insurance 0.0%
Mapfre S.A.		103,173		377,877
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Grifols S.A. *		21,753		873,169
Retailing 0.2%
Inditex S.A.		31,227		4,190,833
Software & Services 0.1%
Amadeus IT Holding S.A., A Shares		44,832		1,322,839
Telecommunication Services 0.5%
Telefonica S.A.		586,276		8,584,433
Transportation 0.1%
Abertis Infraestructuras S.A.		53,069		990,233
International Consolidated Airlines Group S.A. *		124,506		524,470
				1,514,703
Utilities 0.4%
Acciona S.A.		3,458		226,226
Enagas S.A.		28,104		748,440
Gas Natural SDG S.A.		50,536		1,058,207
Iberdrola S.A.		674,300		3,625,418
Red Electrica Corp. S.A.		15,322		814,504
				6,472,795
				49,080,888
Sweden 3.0%
Banks 0.7%
Nordea Bank AB		376,802		4,534,066
Skandinaviska Enskilda Banken AB, A Shares		202,392		2,082,077
Svenska Handelsbanken AB, A Shares		70,477		3,212,915
Swedbank AB, A Shares		115,921		2,854,398
				12,683,456
Capital Goods 0.8%
Alfa Laval AB		48,513		1,069,374
Assa Abloy AB, B Shares		47,906		1,917,139
Atlas Copco AB, A Shares		95,478		2,524,668
Atlas Copco AB, B Shares		56,610		1,350,683
Sandvik AB		142,946		2,038,924
Scania AB, B Shares		45,804		979,578
Skanska AB, B Shares		54,518		930,064
SKF AB, B Shares		55,717		1,300,680
Volvo AB, B Shares		213,241		2,955,477
				15,066,587
Commercial & Professional Supplies 0.0%
Securitas AB, B Shares		45,857		451,251
Consumer Durables & Apparel 0.1%
Electrolux AB, B Shares		35,026		996,885
Husqvarna AB, B Shares		51,798		299,712
				1,296,597
Diversified Financials 0.2%
Industrivarden AB, C Shares		16,064		301,323
Investment AB Kinnevik, B Shares		29,724		779,273
Investor AB, B Shares		64,991		1,927,428
Ratos AB, B Shares		26,143		252,616
				3,260,640
Energy 0.0%
Lundin Petroleum AB *		32,207		774,419
Food, Beverage & Tobacco 0.1%
Swedish Match AB		29,780		1,033,082
Health Care Equipment & Services 0.1%
Elekta AB, B Shares		52,754		808,900
Getinge AB, B Shares		28,786		867,979
				1,676,879
Household & Personal Products 0.1%
Svenska Cellulosa AB, B Shares		83,794		2,182,735
Materials 0.0%
Boliden AB		37,321		596,014
Retailing 0.3%
Hennes & Mauritz AB, B Shares		135,899		4,826,267

72 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Technology Hardware & Equipment 0.4%
Hexagon AB, B Shares		34,297		983,923
Telefonaktiebolaget LM Ericsson, B Shares		435,607		5,417,371
				6,401,294
Telecommunication Services 0.2%
Millicom International Cellular S.A. SDR		9,553		784,628
Tele2 AB, B Shares		45,772		785,408
TeliaSonera AB		309,897		2,138,213
				3,708,249
				53,957,470
Switzerland 8.7%
Banks 0.0%
Banque Cantonale Vaudoise - Reg’d		405		224,403
Capital Goods 0.6%
ABB Ltd. - Reg’d *		314,758		7,137,737
Geberit AG - Reg’d		5,303		1,295,959
Schindler Holding AG		7,017		1,053,002
Schindler Holding AG - Reg’d		2,938		430,304
Sulzer AG - Reg’d		3,272		559,152
					��
				10,476,154
Commercial & Professional Supplies 0.2%
Adecco S.A. - Reg’d *		19,201		1,027,037
SGS S.A. - Reg’d		784		1,895,818
				2,922,855
Consumer Durables & Apparel 0.5%
Compagnie Financiere Richemont S.A., Series A		74,717		6,046,749
The Swatch Group AG - Bearer Shares		4,373		2,508,879
The Swatch Group AG - Reg’d		6,331		636,651
				9,192,279
Diversified Financials 0.9%
Credit Suisse Group AG - Reg’d *		183,883		5,106,621
Julius Baer Group Ltd. *		31,354		1,249,907
Pargesa Holding S.A.		3,688		257,229
Partners Group Holding AG		2,557		656,036
UBS AG - Reg’d		521,220		9,297,737
				16,567,530
Energy 0.2%
Transocean Ltd. *		51,128		2,623,084
Food, Beverage & Tobacco 2.0%
Aryzta AG *		13,046		810,032
Barry Callebaut AG - Reg’d *		247		241,320
Lindt & Spruengli AG		122		472,581
Lindt & Spruengli AG - Reg’d		15		668,455
Nestle S.A. - Reg’d		461,587		32,916,896
				35,109,284
Health Care Equipment & Services 0.0%
Sonova Holding AG - Reg’d *		7,173		781,412
Insurance 0.6%
Baloise Holding AG - Reg’d		6,907		711,940
Swiss Life Holding AG - Reg’d *		4,436		702,769
Swiss Re AG *		50,409		4,011,628
Zurich Insurance Group AG *		21,096		5,895,100
				11,321,437
Materials 0.6%
Ems-Chemie Holding AG - Reg’d		1,099		317,817
Givaudan S.A. - Reg’d *		1,197		1,541,531
Holcim Ltd. - Reg’d *		32,630		2,545,303
Sika AG		313		756,348
Syngenta AG - Reg’d		13,330		5,698,830
				10,859,829
Pharmaceuticals, Biotechnology & Life Sciences 2.9%
Actelion Ltd. - Reg’d *		15,099		924,486
Lonza Group AG - Reg’d *		7,727		538,433
Novartis AG - Reg’d		329,252		24,373,726
Roche Holding AG		100,562		25,174,730
				51,011,375
Real Estate 0.0%
Swiss Prime Site AG - Reg’d *		7,938		650,898
Telecommunication Services 0.1%
Swisscom AG - Reg’d		3,322		1,564,727
Transportation 0.1%
Kuehne & Nagel International AG - Reg’d		7,762		889,084
				154,194,351
United Kingdom 20.7%
Automobiles & Components 0.1%
GKN plc		233,405		999,085
Banks 2.9%
Barclays plc		1,664,521		7,427,885
HSBC Holdings plc		2,634,543		28,853,482
Lloyds Banking Group plc *		6,041,178		5,131,937
Royal Bank of Scotland Group plc *		299,352		1,428,456
Standard Chartered plc		345,103		8,685,345
				51,527,105
Capital Goods 0.9%
BAE Systems plc		458,822		2,679,837
Balfour Beatty plc		98,532		330,866
Bunzl plc		49,725		989,148
Cobham plc		154,384		601,467
IMI plc		47,941		924,118
Invensys plc		116,688		698,617
Meggitt plc		112,360		818,899
Melrose Industries plc		172,236		652,865
Rolls-Royce Holdings plc *		267,994		4,711,143
Rolls-Royce Holdings plc, C Shares (b)*		31,891,286		49,538
Smiths Group plc		58,128		1,130,551
The Weir Group plc		31,455		1,079,094
Wolseley plc		39,073		1,935,251
				16,601,394
Commercial & Professional Supplies 0.5%
Aggreko plc		39,730		1,101,340
Babcock International Group plc		52,399		871,922
Capita plc		93,735		1,314,442
Experian plc		145,201		2,554,770

See financial notes 73

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
G4S plc		201,918		982,851
Intertek Group plc		22,942		1,180,244
Serco Group plc		71,760		690,589
				8,696,158
Consumer Durables & Apparel 0.1%
Burberry Group plc		63,999		1,331,389
Consumer Services 0.4%
Carnival plc		25,371		915,993
Compass Group plc		261,939		3,449,751
InterContinental Hotels Group plc		38,813		1,146,773
TUI Travel plc		63,413		310,043
Whitbread plc		25,628		1,018,795
				6,841,355
Diversified Financials 0.2%
3i Group plc		139,033		710,957
Aberdeen Asset Management plc		128,890		899,692
Hargreaves Lansdown plc		34,659		527,838
ICAP plc		69,275		310,506
Investec plc		73,220		518,489
London Stock Exchange Group plc		26,547		553,945
Schroders plc		15,420		560,037
				4,081,464
Energy 3.5%
AMEC plc		43,001		677,864
BG Group plc		486,896		8,219,455
BP plc		2,728,786		19,773,167
Petrofac Ltd.		37,972		798,097
Royal Dutch Shell plc, A Shares		535,064		18,216,400
Royal Dutch Shell plc, B Shares		375,025		13,154,913
Tullow Oil plc		130,199		2,029,505
				62,869,401
Food & Staples Retailing 0.5%
J. Sainsbury plc		173,373		1,027,484
Tesco plc		1,151,039		6,547,089
WM Morrison Supermarkets plc		320,874		1,456,198
				9,030,771
Food, Beverage & Tobacco 2.8%
Associated British Foods plc		51,133		1,538,172
British American Tobacco plc		276,577		15,332,106
Diageo plc		358,643		10,952,084
Imperial Tobacco Group plc		141,243		5,050,262
SABMiller plc		137,054		7,395,056
Tate & Lyle plc		67,013		879,443
Unilever plc		183,710		7,959,548
				49,106,671
Health Care Equipment & Services 0.1%
Smith & Nephew plc		129,968		1,487,692
Household & Personal Products 0.4%
Reckitt Benckiser Group plc		92,631		6,762,146
Insurance 0.9%
Admiral Group plc		30,444		606,443
Aviva plc		421,592		2,001,513
Legal & General Group plc		846,201		2,231,555
Old Mutual plc		691,820		2,206,622
Prudential plc		365,977		6,292,817
Resolution Ltd.		204,957		841,679
RSA Insurance Group plc		507,726		879,170
Standard Life plc		330,373		1,924,996
				16,984,795
Materials 2.0%
Anglo American plc		199,085		4,867,778
Antofagasta plc		57,957		813,256
BHP Billiton plc		302,315		8,504,961
Croda International plc		19,557		753,913
Eurasian Natural Resources Corp.		35,143		151,124
Evraz plc		50,907		123,882
Fresnillo plc		24,967		451,274
Glencore International plc (a)		558,905		2,762,970
Johnson Matthey plc		29,569		1,115,420
Kazakhmys plc		29,214		158,792
Randgold Resources Ltd.		12,553		1,015,572
Rexam plc		113,065		907,850
Rio Tinto plc		191,890		8,811,604
Vedanta Resources plc		18,357		347,355
Xstrata plc		300,856		4,527,421
				35,313,172
Media 0.6%
British Sky Broadcasting Group plc		151,772		1,989,076
ITV plc		531,875		1,040,041
Pearson plc		117,077		2,129,349
Reed Elsevier plc		170,725		1,996,000
WPP plc		182,076		3,010,139
				10,164,605
Pharmaceuticals, Biotechnology & Life Sciences 1.7%
AstraZeneca plc		178,232		9,253,980
GlaxoSmithKline plc		702,732		18,131,519
Shire plc		80,657		2,514,236
				29,899,735
Real Estate 0.2%
British Land Co., plc		132,505		1,225,738
Hammerson plc		102,495		828,205
Intu Properties plc		94,473		503,159
Land Securities Group plc		110,285		1,498,188
Segro plc		96,274		398,656
				4,453,946
Retailing 0.2%
Kingfisher plc		339,164		1,652,621
Marks & Spencer Group plc		227,394		1,447,415
Next plc		22,608		1,532,515
				4,632,551
Semiconductors & Semiconductor Equipment 0.2%
ARM Holdings plc		195,530		3,041,255
Software & Services 0.1%
The Sage Group plc		169,617		889,916
Telecommunication Services 1.5%
BT Group plc		1,127,564		4,848,105
Inmarsat plc		61,946		696,292
Vodafone Group plc		7,039,947		21,480,953
				27,025,350
Utilities 0.9%
Centrica plc		744,086		4,291,703
National Grid plc		520,749		6,638,094
Severn Trent plc		34,575		979,892

74 See financial notes

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
SSE plc		137,676		3,333,390
United Utilities Group plc		98,249		1,131,846
				16,374,925
				368,114,881
Total Common Stock
(Cost $1,271,956,797)				1,703,066,687
Preferred Stock 0.5% of net assets
Germany 0.5%
Automobiles & Components 0.4%
Bayerische Motoren Werke AG		8,002		557,149
Porsche Automobil Holding SE		21,781		1,710,356
Volkswagen AG		20,701		4,203,929
				6,471,434
Household & Personal Products 0.1%
Henkel AG & Co. KGaA		25,430		2,400,768
Media 0.0%
ProSiebenSat.1 Media AG		15,553		593,623
Utilities 0.0%
RWE AG		5,322		181,208
Total Preferred Stock
(Cost $6,648,095)				9,647,033
Rights 0.0% of net assets
Netherlands 0.0%
Koninklijke (Royal) KPN N.V. (a)*		136,326		183,125
Spain 0.0%
Bankia S.A. *		4,193		6,847
Total Rights
(Cost $749,437)				189,972
Other Investment Company 0.5% of net assets
United States 0.5%
iShares MSCI EAFE Index Fund		140,000		8,671,600
Total Other Investment Company
(Cost $8,089,400)				8,671,600
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 2.6% of net assets
Time Deposits 2.4%
Bank of Tokyo-Mitsubishi UFJ
0.03%, 05/01/13		42,259,898		42,259,898
Brown Brothers Harriman
Swiss Franc
0.00%, 05/01/13		102,275		109,996
Citibank
Euro Currency
(0.00)%, 05/01/13		649,678		855,594
Japanese Yen
0.01%, 05/01/13		2,450,455		25,137
JPMorgan Chase
Norwegian Korne
0.40%, 05/01/13		197,251		34,206
				43,284,831
U.S. Treasury Obligations 0.2%
U.S. Treasury Bills
0.04%, 06/20/13 (c)(d)		300,000		299,983
0.05%, 06/20/13 (c)(d)		50,000		49,997
0.09%, 06/20/13 (c)(d)		2,170,000		2,169,744
				2,519,724
Total Short-Term Investments
(Cost $45,804,555)				45,804,555
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.7% of net assets
Wells Fargo Advantage Government Money Market Fund		13,249,645		13,249,645
Total Collateral Invested for Securities on Loan
(Cost $13,249,645)				13,249,645
End of collateral invested for securities on loan.

At 04/30/13, the tax basis cost of the fund’s investments was $1,341,846,484 and the unrealized appreciation and depreciation were $552,055,617 and ($126,522,254), respectively, with a net unrealized appreciation of $425,533,363.

At 04/30/13, the values of certain foreign securities held by the fund aggregating $1,701,405,029 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

See financial notes 75

 Schwab International Index Fund

Portfolio Holdings (Unaudited) continued

CDI —	CHESS Depositary Interest
CVA —	Dutch Certificate
Reg’d —	Registered
REIT —	Real Estate Investment Trust
RSP —	Risparmio (Convertible Savings Shares)
SDR —	Swedish Depositary Receipt

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI EAFE, e-mini, Long, expires 06/21/13		495		43,084,800		1,721,083

76 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	97	.9%	Common Stock		1,987,826,548		2,561,268,028
	1	.7%	Other Investment Company		43,824,432		43,824,432
	0	.2%	Short-Term Investments		4,602,621		4,602,621
	99	.8%	Total Investments		2,036,253,601		2,609,695,081
	0	.9%	Collateral Invested for Securities on Loan		23,531,749		23,531,749
	(0	.7)%	Other Assets and Liabilities, Net				(17,030,571	)
	100	.0%	Net Assets				2,616,196,259

	Number		Value
Security	of Shares		($)
Common Stock 97.9% of net assets
Automobiles & Components 0.9%
BorgWarner, Inc. *		13,350		1,043,569
Delphi Automotive plc		59,100		2,731,011
Ford Motor Co.		353,374		4,844,758
General Motors Co. *		121,100		3,734,724
Harley-Davidson, Inc.		41,560		2,271,254
Johnson Controls, Inc.		150,010		5,251,850
Lear Corp.		23,300		1,346,274
The Goodyear Tire & Rubber Co. *		71,090		888,270
TRW Automotive Holdings Corp. *		20,850		1,252,459
				23,364,169
Banks 2.3%
BB&T Corp.		115,375		3,550,089
CIT Group, Inc. *		15,800		671,658
Comerica, Inc.		34,800		1,261,500
Fifth Third Bancorp		161,790		2,755,284
Hudson City Bancorp, Inc.		144,590		1,201,543
Huntington Bancshares, Inc.		136,727		980,333
KeyCorp		204,390		2,037,768
M&T Bank Corp.		15,286		1,531,657
New York Community Bancorp, Inc.		69,430		940,776
PNC Financial Services Group, Inc.		64,745		4,394,891
Popular, Inc. *		39,068		1,113,047
Regions Financial Corp.		340,325		2,889,359
SunTrust Banks, Inc.		123,760		3,619,980
Synovus Financial Corp.		239,310		643,744
U.S. Bancorp		241,600		8,040,448
Wells Fargo & Co.		600,825		22,819,333
Zions Bancorp		40,235		990,586
				59,441,996
Capital Goods 7.5%
3M Co.		100,575		10,531,208
AECOM Technology Corp. *		27,300		793,611
AGCO Corp.		22,340		1,189,605
Alliant Techsystems, Inc.		11,420		849,191
Caterpillar, Inc.		87,545		7,412,435
Cummins, Inc.		22,284		2,370,795
Danaher Corp.		41,800		2,547,292
Deere & Co.		51,786		4,624,490
Dover Corp.		31,675		2,184,942
Eaton Corp. plc		59,999		3,684,539
EMCOR Group, Inc.		20,440		764,456
Emerson Electric Co.		132,050		7,330,096
Exelis, Inc.		116,255		1,298,568
Fastenal Co.		18,840		924,102
Flowserve Corp.		6,125		968,485
Fluor Corp.		47,240		2,691,735
General Dynamics Corp.		83,025		6,140,529
General Electric Co.		1,674,525		37,325,162
Harsco Corp.		33,935		740,801
Honeywell International, Inc.		103,740		7,629,040
Hubbell, Inc., Class B		7,430		712,983
Huntington Ingalls Industries, Inc.		14,315		757,264
Illinois Tool Works, Inc.		64,170		4,142,815
Ingersoll-Rand plc		58,742		3,160,320
ITT Corp.		68,127		1,880,305
Jacobs Engineering Group, Inc. *		38,240		1,930,355
Joy Global, Inc.		17,200		972,144
KBR, Inc.		41,600		1,251,328
L-3 Communications Holdings, Inc.		43,835		3,561,594
Lennox International, Inc.		13,935		863,970
Lockheed Martin Corp.		73,735		7,306,401
Masco Corp.		123,550		2,401,812
Northrop Grumman Corp.		108,495		8,217,411
Oshkosh Corp. *		24,920		978,359
Owens Corning *		24,050		1,011,543
PACCAR, Inc.		62,542		3,113,341
Pall Corp.		10,440		696,452
Parker Hannifin Corp.		28,217		2,499,180
Pentair Ltd.		16,737		909,656
Precision Castparts Corp.		11,116		2,126,380
Quanta Services, Inc. *		27,200		747,456
Raytheon Co.		109,010		6,691,034
Rockwell Automation, Inc.		15,750		1,335,285
Rockwell Collins, Inc.		23,030		1,449,048
Roper Industries, Inc.		5,400		646,110
SPX Corp.		15,335		1,142,611
Stanley Black & Decker, Inc.		15,403		1,152,298
Terex Corp. *		33,525		958,815
Textron, Inc.		56,720		1,460,540
The Boeing Co.		91,340		8,349,389
The Timken Co.		15,465		812,995
Trinity Industries, Inc.		16,825		710,183

See financial notes 1

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
United Rentals, Inc. *		17,300		910,153
United Technologies Corp.		165,715		15,128,122
URS Corp.		30,593		1,343,645
W.W. Grainger, Inc.		8,235		2,029,680
WESCO International, Inc. *		12,600		903,294
Xylem, Inc.		27,155		753,551
				197,018,904
Commercial & Professional Supplies 1.0%
Avery Dennison Corp.		29,850		1,237,282
Cintas Corp.		24,650		1,106,046
Equifax, Inc.		15,930		974,916
Iron Mountain, Inc.		19,180		726,155
Manpowergroup, Inc.		52,690		2,801,000
Pitney Bowes, Inc. (b)		92,305		1,261,809
R.R. Donnelley & Sons Co. (b)		176,440		2,171,976
Republic Services, Inc.		43,124		1,469,666
Robert Half International, Inc.		39,510		1,296,718
The Brink’s Co.		21,820		578,448
The Dun & Bradstreet Corp. (b)		11,000		972,950
Tyco International Ltd.		145,365		4,669,124
United Stationers, Inc.		24,250		787,398
Waste Management, Inc.		129,155		5,292,772
				25,346,260
Consumer Durables & Apparel 1.1%
Coach, Inc.		36,175		2,129,260
D.R. Horton, Inc.		52,590		1,371,547
Garmin Ltd. (b)		20,670		725,104
Harman International Industries, Inc.		15,020		671,544
Hasbro, Inc.		29,765		1,409,968
Jarden Corp. *		18,615		837,861
Leggett & Platt, Inc.		43,720		1,409,533
Mattel, Inc.		51,335		2,343,956
Mohawk Industries, Inc. *		11,535		1,279,001
Newell Rubbermaid, Inc.		52,550		1,384,167
NIKE, Inc., Class B		95,556		6,077,362
NVR, Inc. *		1,303		1,342,090
Ralph Lauren Corp.		7,020		1,274,692
The Jones Group, Inc.		55,375		775,250
VF Corp.		11,045		1,968,440
Whirlpool Corp.		25,155		2,874,713
				27,874,488
Consumer Services 1.4%
Apollo Group, Inc., Class A *		51,550		946,974
Brinker International, Inc.		25,755		1,001,869
Carnival Corp.		50,045		1,727,053
Darden Restaurants, Inc.		28,145		1,453,126
H&R Block, Inc.		46,865		1,300,035
International Game Technology		57,055		967,082
Marriott International, Inc., Class A		38,189		1,644,418
McDonald’s Corp.		142,080		14,512,051
MGM Resorts International *		69,015		974,492
Royal Caribbean Cruises Ltd.		31,705		1,158,184
Service Corp. International		45,600		769,728
Starbucks Corp.		47,590		2,895,376
Starwood Hotels & Resorts Worldwide, Inc.		32,770		2,114,320
Wyndham Worldwide Corp.		21,340		1,282,107
Wynn Resorts Ltd.		7,800		1,070,940
Yum! Brands, Inc.		46,030		3,135,564
				36,953,319
Diversified Financials 7.0%
American Express Co.		132,925		9,093,399
Ameriprise Financial, Inc.		23,800		1,773,814
Bank of America Corp.		3,808,160		46,878,450
BlackRock, Inc.		6,500		1,732,250
Capital One Financial Corp.		88,320		5,103,130
Citigroup, Inc.		687,533		32,080,290
CME Group, Inc.		24,800		1,509,328
Discover Financial Services		51,422		2,249,198
Federated Investors, Inc., Class B (b)		25,430		583,873
Franklin Resources, Inc.		20,940		3,238,580
Invesco Ltd.		44,500		1,412,430
Janus Capital Group, Inc.		72,000		642,240
JPMorgan Chase & Co.		709,942		34,794,257
Legg Mason, Inc.		47,120		1,501,243
Moody’s Corp.		28,470		1,732,400
Morgan Stanley		227,735		5,044,330
Northern Trust Corp.		22,760		1,227,219
NYSE Euronext		53,620		2,080,992
PHH Corp. *		34,990		737,589
SLM Corp.		63,335		1,307,868
State Street Corp.		48,936		2,861,288
T. Rowe Price Group, Inc.		24,145		1,750,513
TD Ameritrade Holding Corp.		38,670		769,920
The Bank of New York Mellon Corp.		130,552		3,684,177
The Charles Schwab Corp. (a)		148,715		2,522,206
The Goldman Sachs Group, Inc.		88,411		12,914,195
The McGraw-Hill Cos., Inc.		59,780		3,234,696
				182,459,875
Energy 14.8%
Anadarko Petroleum Corp.		59,515		5,044,491
Apache Corp.		55,720		4,116,594
Arch Coal, Inc. (b)		93,400		452,990
Baker Hughes, Inc.		87,349		3,964,771
Cameron International Corp. *		23,780		1,463,659
Chesapeake Energy Corp.		184,620		3,607,475
Chevron Corp.		526,805		64,275,478
Cimarex Energy Co.		10,845		793,637
ConocoPhillips		733,310		44,328,589
CONSOL Energy, Inc.		26,635		896,001
Devon Energy Corp.		85,240		4,693,314
Diamond Offshore Drilling, Inc.		17,920		1,238,272
Energen Corp.		13,510		640,644
EOG Resources, Inc.		18,850		2,283,866
Exxon Mobil Corp.		1,332,584		118,586,650
FMC Technologies, Inc. *		19,280		1,046,904
Frontline Ltd. (b)*		204,800		372,736
Halliburton Co.		146,565		6,268,585
Helmerich & Payne, Inc.		12,095		709,009
Hess Corp.		108,850		7,856,793

2 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
HollyFrontier Corp.		13,802		682,509
Kinder Morgan, Inc.		28,600		1,118,260
Marathon Oil Corp.		374,690		12,241,122
Marathon Petroleum Corp.		102,995		8,070,688
McDermott International, Inc. *		65,310		697,511
Murphy Oil Corp.		73,675		4,574,481
Nabors Industries Ltd.		115,100		1,702,329
National Oilwell Varco, Inc.		47,123		3,073,362
Newfield Exploration Co. *		28,400		618,836
Noble Energy, Inc.		14,535		1,646,670
Occidental Petroleum Corp.		131,970		11,779,642
Patterson-UTI Energy, Inc.		51,800		1,092,462
Peabody Energy Corp.		55,845		1,120,251
Phillips 66		364,355		22,207,437
Pioneer Natural Resources Co.		6,200		757,826
QEP Resources, Inc.		25,950		745,025
Rowan Cos. plc, Class A *		19,300		627,829
Schlumberger Ltd.		128,300		9,549,369
SEACOR Holdings, Inc.		10,000		721,100
Southwestern Energy Co. *		20,140		753,639
Spectra Energy Corp.		84,460		2,663,024
Tesoro Corp.		62,460		3,335,364
The Williams Cos., Inc.		89,175		3,400,243
Tidewater, Inc.		14,020		735,349
Valero Energy Corp.		428,725		17,286,192
World Fuel Services Corp.		38,100		1,544,955
WPX Energy, Inc. *		82,158		1,284,130
				386,670,063
Food & Staples Retailing 4.3%
Casey’s General Stores, Inc.		13,312		770,898
Costco Wholesale Corp.		102,415		11,104,858
CVS Caremark Corp.		343,235		19,969,412
Safeway, Inc.		283,140		6,376,313
SUPERVALU, Inc. (b)		856,620		5,002,661
Sysco Corp.		168,840		5,885,762
The Kroger Co.		267,820		9,207,652
Wal-Mart Stores, Inc.		479,925		37,299,771
Walgreen Co.		297,570		14,732,691
Whole Foods Market, Inc.		14,900		1,315,968
				111,665,986
Food, Beverage & Tobacco 5.1%
Altria Group, Inc.		384,180		14,026,412
Archer-Daniels-Midland Co.		263,105		8,929,784
Beam, Inc.		19,700		1,274,787
Brown-Forman Corp., Class B		12,950		912,975
Bunge Ltd.		69,175		4,995,127
Campbell Soup Co.		35,330		1,639,665
Coca-Cola Enterprises, Inc.		114,195		4,182,963
ConAgra Foods, Inc.		107,605		3,805,989
Constellation Brands, Inc., Class A *		23,105		1,140,232
Dean Foods Co. *		101,590		1,944,432
Dr Pepper Snapple Group, Inc.		32,800		1,601,624
General Mills, Inc.		84,310		4,250,910
H.J. Heinz Co.		42,875		3,105,007
Hillshire Brands Co.		69,600		2,499,336
Hormel Foods Corp.		21,120		871,622
Ingredion, Inc.		12,200		878,522
Kellogg Co.		40,880		2,658,835
Lorillard, Inc.		60,554		2,597,161
McCormick & Co., Inc. - Non Voting Shares		11,940		858,964
Mead Johnson Nutrition Co.		10,100		819,009
Molson Coors Brewing Co., Class B		20,780		1,072,248
Mondelez International, Inc., Class A		339,492		10,677,023
PepsiCo, Inc.		218,308		18,003,861
Philip Morris International, Inc.		166,720		15,936,765
Reynolds American, Inc.		50,050		2,373,371
Smithfield Foods, Inc. *		59,706		1,528,474
The Coca-Cola Co.		337,930		14,304,577
The Hershey Co.		13,150		1,172,454
The JM Smucker Co.		16,025		1,654,261
Tyson Foods, Inc., Class A		137,180		3,378,743
				133,095,133
Health Care Equipment & Services 5.3%
Abbott Laboratories		203,290		7,505,467
Aetna, Inc.		131,360		7,545,318
AmerisourceBergen Corp.		113,040		6,117,725
Baxter International, Inc.		74,760		5,223,481
Becton, Dickinson & Co.		37,355		3,522,577
Boston Scientific Corp. *		338,265		2,533,605
C.R. Bard, Inc.		13,900		1,381,104
Cardinal Health, Inc.		187,820		8,305,400
CareFusion Corp. *		30,710		1,026,942
Cigna Corp.		52,009		3,441,436
Community Health Systems, Inc.		33,550		1,528,874
Coventry Health Care, Inc.		47,350		2,346,193
Covidien plc		47,670		3,043,253
DaVita HealthCare Partners, Inc. *		10,980		1,302,777
DENTSPLY International, Inc.		17,935		759,547
Express Scripts Holding Co. *		57,240		3,398,339
HCA Holdings, Inc.		37,200		1,483,908
Health Net, Inc. *		68,970		2,027,718
Henry Schein, Inc. *		13,230		1,195,992
Humana, Inc.		51,340		3,804,807
Kindred Healthcare, Inc. *		55,800		585,342
Laboratory Corp. of America Holdings *		12,030		1,123,121
LifePoint Hospitals, Inc. *		15,730		755,040
McKesson Corp.		88,700		9,386,234
Medtronic, Inc.		167,065		7,798,594
Omnicare, Inc.		32,510		1,422,963
Owens & Minor, Inc.		29,602		964,137
Patterson Cos., Inc.		20,075		761,846
Quest Diagnostics, Inc.		36,755		2,070,409
St. Jude Medical, Inc.		51,060		2,104,693
Stryker Corp.		37,045		2,429,411
Tenet Healthcare Corp. *		24,793		1,124,610
UnitedHealth Group, Inc.		290,175		17,390,188
Universal Health Services, Inc., Class B		17,450		1,161,996
Varian Medical Systems, Inc. *		12,820		835,095
WellCare Health Plans, Inc. *		11,200		653,072
WellPoint, Inc.		252,770		18,431,988

See financial notes 3

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Zimmer Holdings, Inc.		36,840		2,816,418
				139,309,620
Household & Personal Products 2.2%
Avon Products, Inc.		118,425		2,742,723
Church & Dwight Co., Inc.		10,600		677,234
Colgate-Palmolive Co.		47,930		5,723,321
Energizer Holdings, Inc.		9,220		890,560
Herbalife Ltd. (b)		15,300		607,563
Kimberly-Clark Corp.		53,620		5,533,048
The Clorox Co.		13,420		1,157,475
The Estee Lauder Cos., Inc., Class A		15,820		1,097,117
The Procter & Gamble Co.		528,395		40,564,884
				58,993,925
Insurance 4.3%
ACE Ltd.		40,500		3,610,170
Aflac, Inc.		68,640		3,736,762
American Financial Group, Inc.		19,440		938,369
American International Group, Inc. *		105,380		4,364,840
Aon plc		34,536		2,084,248
Arch Capital Group Ltd. *		25,075		1,330,479
Aspen Insurance Holdings Ltd.		20,725		791,488
Assurant, Inc.		39,355		1,870,937
Axis Capital Holdings Ltd.		29,850		1,332,205
Berkshire Hathaway, Inc., Class B *		175,111		18,617,802
Cincinnati Financial Corp.		29,580		1,446,758
Endurance Specialty Holdings Ltd.		18,830		922,105
Everest Re Group Ltd.		10,525		1,420,770
Fidelity National Financial, Inc., Class A		55,625		1,493,531
Genworth Financial, Inc., Class A *		239,100		2,398,173
Hartford Financial Services Group, Inc.		187,310		5,261,538
Kemper Corp.		19,850		632,421
Lincoln National Corp.		62,880		2,138,549
Loews Corp.		61,682		2,755,335
Marsh & McLennan Cos., Inc.		66,250		2,518,162
MetLife, Inc.		97,805		3,813,417
PartnerRe Ltd.		16,930		1,597,176
Platinum Underwriters Holdings Ltd.		15,400		873,950
Principal Financial Group, Inc.		42,585		1,537,318
Prudential Financial, Inc.		90,240		5,452,301
Reinsurance Group of America, Inc.		12,000		750,600
RenaissanceRe Holdings Ltd.		13,125		1,232,306
The Allstate Corp.		140,655		6,928,665
The Chubb Corp.		68,875		6,065,821
The Progressive Corp.		162,245		4,103,176
The Travelers Cos., Inc.		168,395		14,382,617
Torchmark Corp.		17,510		1,086,846
Unum Group		55,925		1,559,748
W. R. Berkley Corp.		24,660		1,070,737
White Mountains Insurance Group Ltd.		1,129		652,912
XL Group plc		53,985		1,681,093
				112,453,325
Materials 3.3%
Air Products & Chemicals, Inc.		33,975		2,954,466
Airgas, Inc.		9,000		869,850
Albemarle Corp.		10,400		637,000
Alcoa, Inc.		548,705		4,663,993
Allegheny Technologies, Inc.		31,811		858,261
AptarGroup, Inc.		11,100		622,710
Ashland, Inc.		18,635		1,587,888
Ball Corp.		29,280		1,291,834
Bemis Co., Inc.		24,555		966,239
Celanese Corp., Series A		21,200		1,047,492
CF Industries Holdings, Inc.		4,171		777,933
Cliffs Natural Resources, Inc. (b)		24,800		529,232
Commercial Metals Co.		72,645		1,062,070
Domtar Corp.		14,491		1,007,269
E.I. du Pont de Nemours & Co.		115,745		6,309,260
Eastman Chemical Co.		23,020		1,534,283
Ecolab, Inc.		21,791		1,843,954
FMC Corp.		12,680		769,676
Freeport-McMoRan Copper & Gold, Inc.		172,370		5,245,219
Huntsman Corp.		50,915		960,257
International Flavors & Fragrances, Inc.		12,035		928,982
International Paper Co.		99,395		4,669,577
LyondellBasell Industries N.V., Class A		17,000		1,031,900
Martin Marietta Materials, Inc.		7,210		728,138
MeadWestvaco Corp.		41,640		1,435,747
Monsanto Co.		40,795		4,357,722
Newmont Mining Corp.		58,010		1,879,524
Nucor Corp.		101,280		4,417,834
Owens-Illinois, Inc. *		48,345		1,270,507
Packaging Corp. of America		17,845		848,708
PPG Industries, Inc.		19,400		2,854,516
Praxair, Inc.		33,370		3,814,191
Reliance Steel & Aluminum Co.		24,320		1,582,502
RPM International, Inc.		22,565		731,106
Sealed Air Corp.		52,475		1,160,747
Sigma-Aldrich Corp.		13,030		1,025,331
Sonoco Products Co.		26,955		944,503
Southern Copper Corp.		23,922		797,320
Steel Dynamics, Inc.		72,450		1,089,648
The Dow Chemical Co.		247,300		8,385,943
The Mosaic Co.		37,910		2,334,877
The Sherwin-Williams Co.		10,445		1,912,584
The Valspar Corp.		11,650		743,503
United States Steel Corp. (b)		88,895		1,582,331
Vulcan Materials Co.		20,623		1,028,675
				87,095,302
Media 4.1%
Cablevision Systems Corp., Class A		70,565		1,048,596

4 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
CBS Corp., Class B - Non Voting Shares		112,190		5,136,058
Charter Communications, Inc., Class A *		10,300		1,037,622
Comcast Corp., Class A		299,040		12,350,352
DIRECTV *		146,340		8,276,990
Discovery Communications, Inc., Class A *		14,467		1,140,289
DISH Network Corp., Class A		25,970		1,017,764
Gannett Co., Inc.		97,530		1,966,205
Lamar Advertising Co., Class A *		18,720		876,470
Liberty Global, Inc., Class A *		59,110		4,277,791
News Corp., Class A		267,720		8,291,289
Omnicom Group, Inc.		55,304		3,305,520
The Interpublic Group of Cos., Inc.		50,605		700,373
The Walt Disney Co.		290,050		18,226,742
The Washington Post Co., Class B		1,785		791,362
Thomson Reuters Corp.		65,000		2,176,850
Time Warner Cable, Inc.		49,009		4,601,455
Time Warner, Inc.		397,288		23,749,877
Viacom Inc., Class B		81,400		5,208,786
Virgin Media, Inc.		50,110		2,444,366
				106,624,757
Pharmaceuticals, Biotechnology & Life Sciences 5.4%
Actavis, Inc. *		8,565		905,577
Agilent Technologies, Inc.		74,105		3,070,911
Allergan, Inc.		12,730		1,445,491
Amgen, Inc.		117,655		12,260,828
Biogen Idec, Inc. *		15,950		3,491,933
Bristol-Myers Squibb Co.		237,850		9,447,402
Celgene Corp. *		8,700		1,027,209
Eli Lilly & Co.		156,555		8,670,016
Forest Laboratories, Inc. *		45,255		1,692,990
Gilead Sciences, Inc. *		119,920		6,072,749
Hospira, Inc. *		24,250		803,160
Johnson & Johnson		424,695		36,196,755
Life Technologies Corp. *		16,019		1,180,440
Merck & Co., Inc.		343,157		16,128,379
Mettler-Toledo International, Inc. *		3,200		668,672
Mylan, Inc. *		26,775		779,420
Pfizer, Inc.		1,156,899		33,631,054
Thermo Fisher Scientific, Inc.		38,545		3,109,811
Warner Chilcott plc, Class A		52,800		759,264
Waters Corp. *		7,300		674,520
				142,016,581
Real Estate 1.0%
American Tower Corp.		18,365		1,542,476
Annaly Capital Management, Inc.		119,985		1,912,561
Apartment Investment & Management Co., Class A		30,154		938,091
AvalonBay Communities, Inc.		4,499		598,547
Boston Properties, Inc.		10,890		1,191,693
Duke Realty Corp.		38,075		671,643
Equity Residential		23,345		1,355,411
HCP, Inc.		18,865		1,005,504
Hospitality Properties Trust		28,255		830,980
Host Hotels & Resorts, Inc.		80,278		1,466,679
Kimco Realty Corp.		31,660		752,875
Plum Creek Timber Co., Inc.		24,495		1,262,472
Public Storage		7,330		1,209,450
Rayonier, Inc.		11,702		695,333
Simon Property Group, Inc.		12,876		2,292,829
Ventas, Inc.		10,478		834,363
Vornado Realty Trust REIT		17,128		1,499,728
Weyerhaeuser Co.		199,657		6,091,535
				26,152,170
Retailing 4.5%
Aaron’s, Inc.		19,800		568,458
Abercrombie & Fitch Co., Class A		23,710		1,175,067
Advance Auto Parts, Inc.		13,345		1,119,379
Amazon.com, Inc. *		7,950		2,017,789
American Eagle Outfitters, Inc.		56,635		1,101,551
AutoZone, Inc. *		1,623		663,953
Bed Bath & Beyond, Inc. *		36,465		2,508,792
Best Buy Co., Inc.		318,300		8,272,617
Big Lots, Inc. *		34,465		1,255,215
CarMax, Inc. *		29,180		1,343,447
Core-Mark Holding Co., Inc.		15,300		796,212
Dillard’s, Inc., Class A		9,975		822,040
Dollar General Corp. *		18,600		968,874
Dollar Tree, Inc. *		28,634		1,361,833
Expedia, Inc.		16,165		902,654
Family Dollar Stores, Inc.		16,675		1,023,345
Foot Locker, Inc.		34,895		1,216,789
GameStop Corp., Class A (b)		60,990		2,128,551
Genuine Parts Co.		35,400		2,702,082
J.C. Penney Co., Inc. (b)*		109,900		1,804,558
Kohl’s Corp.		91,795		4,319,873
L Brands, Inc.		36,220		1,825,850
Liberty Interactive Corp., Class A *		124,220		2,644,644
Lowe’s Cos., Inc.		366,055		14,063,833
Macy’s, Inc.		94,520		4,215,592
Nordstrom, Inc.		32,155		1,819,651
O’Reilly Automotive, Inc. *		9,830		1,054,956
Office Depot, Inc. *		234,450		904,977
PetSmart, Inc.		16,840		1,149,162
RadioShack Corp. (b)		214,280		679,268
Rent-A-Center, Inc.		22,070		770,905
Ross Stores, Inc.		19,090		1,261,276
Sears Holdings Corp. (b)*		45,221		2,321,646
Signet Jewelers Ltd.		16,500		1,134,045
Staples, Inc.		336,550		4,455,922
Target Corp.		191,595		13,518,943
The Gap, Inc.		99,675		3,786,653
The Home Depot, Inc.		243,596		17,867,766
The TJX Cos., Inc.		96,060		4,684,846
Tiffany & Co.		18,035		1,328,819
Tractor Supply Co.		6,100		653,737
Williams-Sonoma, Inc.		17,845		957,920
				119,173,490
Semiconductors & Semiconductor Equipment 2.2%
Altera Corp.		21,950		702,620

See financial notes 5

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Analog Devices, Inc.		47,965		2,109,980
Applied Materials, Inc.		386,925		5,614,282
Broadcom Corp., Class A		42,945		1,546,020
Intel Corp.		1,008,610		24,156,209
KLA-Tencor Corp.		26,380		1,431,115
Lam Research Corp. *		29,500		1,363,490
Linear Technology Corp.		23,855		870,708
LSI Corp. *		104,340		682,384
Marvell Technology Group Ltd.		68,930		741,687
Maxim Integrated Products, Inc.		40,800		1,261,944
MEMC Electronic Materials, Inc. *		210,300		1,135,620
Microchip Technology, Inc.		26,680		971,686
Micron Technology, Inc. *		244,075		2,299,186
NVIDIA Corp.		74,237		1,022,243
Texas Instruments, Inc.		300,270		10,872,777
Xilinx, Inc.		41,220		1,562,650
				58,344,601
Software & Services 5.7%
Accenture plc, Class A		55,695		4,535,801
Adobe Systems, Inc. *		39,440		1,777,955
Alliance Data Systems Corp. *		5,580		958,477
Amdocs Ltd.		27,400		978,180
AOL, Inc. *		51,080		1,973,731
Autodesk, Inc. *		20,200		795,476
Automatic Data Processing, Inc.		62,980		4,241,073
BMC Software, Inc. *		22,540		1,025,119
CA, Inc.		44,505		1,200,300
Cognizant Technology Solutions Corp., Class A *		12,800		829,440
Computer Sciences Corp.		80,345		3,764,163
Compuware Corp. *		68,000		816,000
Convergys Corp.		36,765		625,740
CoreLogic, Inc. *		82,900		2,261,512
DST Systems, Inc.		11,400		788,310
eBay, Inc. *		77,175		4,043,198
Fidelity National Information Services, Inc.		48,623		2,044,597
Fiserv, Inc. *		19,350		1,762,979
Google, Inc., Class A *		9,296		7,665,203
IAC/InterActiveCorp		26,262		1,236,152
International Business Machines Corp.		155,095		31,412,941
Intuit, Inc.		22,755		1,357,108
MasterCard, Inc., Class A		3,362		1,858,951
Microsoft Corp.		1,392,415		46,088,936
Oracle Corp.		282,560		9,262,317
Paychex, Inc.		39,260		1,429,457
SAIC, Inc.		108,200		1,616,508
Symantec Corp. *		160,245		3,893,954
Teradata Corp. *		9,100		464,737
The Western Union Co.		97,410		1,442,642
Total System Services, Inc.		30,770		726,787
VeriSign, Inc. *		15,400		709,478
Visa, Inc., Class A		13,200		2,223,672
Yahoo! Inc. *		113,505		2,806,979
				148,617,873
Technology Hardware & Equipment 4.1%
Amphenol Corp., Class A		13,500		1,019,520
Anixter International, Inc.		10,520		754,705
Apple, Inc.		20,039		8,872,267
Arrow Electronics, Inc. *		45,395		1,780,846
Avnet, Inc. *		59,580		1,951,245
Cisco Systems, Inc.		872,765		18,258,244
Corning, Inc.		188,060		2,726,870
Dell, Inc.		551,410		7,388,894
EMC Corp. *		172,210		3,862,670
Harris Corp.		26,625		1,230,075
Hewlett-Packard Co.		1,429,875		29,455,425
Ingram Micro, Inc., Class A *		168,155		2,994,840
Jabil Circuit, Inc.		50,295		895,251
Juniper Networks, Inc. *		84,070		1,391,358
Lexmark International, Inc., Class A		29,645		898,540
Molex, Inc.		27,530		759,002
Motorola Solutions, Inc.		95,645		5,470,894
NetApp, Inc. *		25,930		904,698
QUALCOMM, Inc.		97,285		5,994,702
SanDisk Corp. *		20,665		1,083,673
Tech Data Corp. *		43,540		2,034,624
Tellabs, Inc.		195,160		403,981
Vishay Intertechnology, Inc. *		48,140		675,886
Western Digital Corp.		42,100		2,327,288
Xerox Corp.		355,726		3,052,129
				106,187,627
Telecommunication Services 4.2%
AT&T, Inc.		1,373,185		51,439,510
CenturyLink, Inc.		61,355		2,305,107
Crown Castle International Corp. *		14,280		1,099,560
Frontier Communications Corp. (b)		330,698		1,375,704
NII Holdings, Inc. (b)*		150,570		1,309,959
Sprint Nextel Corp. *		1,662,600		11,721,330
Telephone & Data Systems, Inc.		53,227		1,194,414
Verizon Communications, Inc.		714,730		38,531,094
Windstream Corp. (b)		177,900		1,515,708
				110,492,386
Transportation 1.8%
Avis Budget Group, Inc. *		64,890		1,871,428
C.H. Robinson Worldwide, Inc.		30,680		1,822,085
CSX Corp.		213,410		5,247,752
Delta Air Lines, Inc. *		118,600		2,032,804
Expeditors International of Washington, Inc.		32,825		1,179,402
FedEx Corp.		79,762		7,498,426
Hertz Global Holdings, Inc. *		67,700		1,630,216
J.B. Hunt Transport Services, Inc.		11,445		813,396
Norfolk Southern Corp.		50,650		3,921,323
Ryder System, Inc.		26,220		1,522,595
Southwest Airlines Co.		191,075		2,617,728
Union Pacific Corp.		49,756		7,361,898
United Continental Holdings, Inc. *		42,843		1,383,829

6 See financial notes

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
United Parcel Service, Inc., Class B		88,460		7,593,406
				46,496,288
Utilities 4.4%
AGL Resources, Inc.		16,714		732,909
Alliant Energy Corp.		22,475		1,202,637
Ameren Corp.		75,790		2,747,387
American Electric Power Co., Inc.		96,545		4,965,309
American Water Works Co., Inc.		19,900		833,412
Atmos Energy Corp.		26,060		1,156,282
Calpine Corp. *		57,650		1,252,735
CenterPoint Energy, Inc.		83,270		2,055,104
CMS Energy Corp.		43,210		1,293,707
Consolidated Edison, Inc.		56,225		3,578,721
Dominion Resources, Inc.		125,910		7,766,129
DTE Energy Co.		41,365		3,014,681
Duke Energy Corp.		92,748		6,974,650
Edison International		70,290		3,781,602
Entergy Corp.		67,017		4,773,621
Exelon Corp.		217,337		8,152,311
FirstEnergy Corp.		107,234		4,997,104
Great Plains Energy, Inc.		31,570		761,784
Integrys Energy Group, Inc.		20,035		1,233,355
MDU Resources Group, Inc.		44,780		1,117,261
National Fuel Gas Co.		12,745		799,366
NextEra Energy, Inc.		63,780		5,231,873
NiSource, Inc.		62,735		1,927,847
Northeast Utilities		30,015		1,360,580
NRG Energy, Inc.		113,726		3,169,544
NV Energy, Inc.		41,500		897,645
OGE Energy Corp.		14,265		1,033,214
ONEOK, Inc.		33,020		1,695,907
Pepco Holdings, Inc.		76,265		1,723,589
PG&E Corp.		92,015		4,457,207
Pinnacle West Capital Corp.		20,885		1,271,896
PPL Corp.		87,155		2,909,234
Public Service Enterprise Group, Inc.		123,480		4,520,603
Questar Corp.		42,750		1,085,423
SCANA Corp.		23,585		1,278,307
Sempra Energy		42,915		3,555,508
TECO Energy, Inc.		52,225		999,064
The AES Corp.		203,440		2,819,678
The Southern Co.		131,270		6,331,152
UGI Corp.		27,620		1,131,868
Westar Energy, Inc.		20,070		701,647
Wisconsin Energy Corp.		25,440		1,143,274
Xcel Energy, Inc.		93,890		2,984,763
				115,419,890
Total Common Stock
(Cost $1,987,826,548)				2,561,268,028
Other Investment Company 1.7% of net assets
Money Market Fund 1.7%
State Street Institutional U.S. Government Money Market Fund		43,824,432		43,824,432
Total Other Investment Company
(Cost $43,824,432)				43,824,432
Security	Face Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 0.2% of net assets
U.S. Treasury Obligations 0.2%
U.S. Treasury Bills
0.01%, 06/20/13 (c)(d)		1,500,000		1,499,979
0.03%, 06/20/13 (c)(d)		100,000		99,996
0.09%, 06/20/13 (c)(d)		3,003,000		3,002,646
Total Short-Term Investments
(Cost $4,602,621)				4,602,621
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.9% of net assets
State Street Institutional U.S. Government Money Market Fund		23,531,749		23,531,749
Total Collateral Invested for Securities on Loan
(Cost $23,531,749)				23,531,749
End of Collateral Invested for Securities on Loan.

At 04/30/13 tax basis cost of the fund’s investments was $2,056,974,209 and the unrealized appreciation and depreciation were $572,461,875 and ($19,741,003), respectively, with a net unrealized appreciation of $552,720,872.

*	Non-income producing security.
(a)	Issuer is affiliated with the fund’s adviser.
(b)	All or a portion of this security is on loan.
(c)	All or a portion of this security is held as collateral for open futures contracts.
(d)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

See financial notes 7

 Schwab Fundamental US Large Company Index Fund

Portfolio Holdings (Unaudited) continued

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
S&P 500 Index, e-mini, Long, expires 06/21/13		580		46,173,800		1,174,537

8 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	98	.6%	Common Stock		579,997,059		718,431,793
	0	.0%	Warrants		—		215
	1	.1%	Other Investment Company		7,889,934		7,889,934
	0	.1%	Short-Term Investment		681,920		681,920
	99	.8%	Total Investments		588,568,913		727,003,862
	2	.7%	Collateral Invested for Securities on Loan		19,734,121		19,734,121
	(2	.5)%	Other Assets and Liabilities, Net				(18,374,897	)
	100	.0%	Net Assets				728,363,086

	Number		Value
Security	of Shares		($)
Common Stock 98.6% of net assets
Automobiles & Components 1.3%
Cooper Tire & Rubber Co.		37,200		925,908
Dana Holding Corp.		90,700		1,564,575
Drew Industries, Inc.		10,195		368,039
Exide Technologies *		225,800		191,275
Federal-Mogul Corp. *		34,000		254,320
Gentex Corp.		53,100		1,194,750
Modine Manufacturing Co. *		70,155		641,217
Superior Industries International, Inc.		20,160		370,138
Tenneco, Inc. *		20,200		781,134
Thor Industries, Inc.		39,800		1,476,182
Visteon Corp. *		22,300		1,311,017
Winnebago Industries, Inc. *		27,065		495,831
				9,574,386
Banks 4.3%
Associated Banc-Corp.		96,100		1,371,347
Astoria Financial Corp.		88,100		844,879
BancorpSouth, Inc.		51,000		816,000
Bank of Hawaii Corp.		22,400		1,068,256
BOK Financial Corp.		7,300		456,177
CapitalSource, Inc.		193,200		1,729,140
Capitol Federal Financial, Inc.		31,986		378,714
Cathay General Bancorp		23,000		453,330
Chemical Financial Corp.		11,930		295,864
City Holding Co.		8,690		331,784
City National Corp.		15,200		869,896
Commerce Bancshares, Inc.		24,485		982,093
Cullen/Frost Bankers, Inc.		15,200		918,232
CVB Financial Corp.		26,880		292,186
East West Bancorp, Inc.		27,200		661,776
F.N.B. Corp.		44,200		503,438
First Commonwealth Financial Corp.		46,790		334,549
First Horizon National Corp.		138,700		1,442,480
First Midwest Bancorp, Inc.		31,895		400,282
First Niagara Financial Group, Inc.		85,300		811,203
First Republic Bank		13,800		524,124
Firstmerit Corp.		79,001		1,353,287
Fulton Financial Corp.		74,500		823,970
Glacier Bancorp, Inc.		23,380		431,361
Hancock Holding Co.		10,400		283,608
International Bancshares Corp.		25,300		490,820
MB Financial, Inc.		18,345		454,222
MGIC Investment Corp. *		125,700		678,780
National Penn Bancshares, Inc.		30,223		295,883
NBT Bancorp, Inc.		15,355		310,939
Northwest Bancshares, Inc.		24,692		302,477
Old National Bancorp		31,725		386,411
Park National Corp. (b)		5,810		397,288
People’s United Financial, Inc.		102,600		1,350,216
Prosperity Bancshares, Inc.		9,300		427,242
Provident Financial Services, Inc.		31,390		481,209
Susquehanna Bancshares, Inc.		50,200		585,834
SVB Financial Group *		6,400		455,104
TCF Financial Corp.		94,900		1,380,795
Trustmark Corp.		25,800		633,390
UMB Financial Corp.		8,701		438,008
Umpqua Holdings Corp.		33,300		399,600
United Bankshares, Inc. (b)		17,895		452,923
Valley National Bancorp		86,500		777,635
Washington Federal, Inc.		40,300		691,951
Webster Financial Corp.		24,800		579,576
Westamerica Bancorp		10,770		467,310
Wintrust Financial Corp.		7,840		281,142
				31,096,731
Capital Goods 11.2%
A.O. Smith Corp.		12,400		935,332
AAR Corp.		42,280		755,121
Actuant Corp., Class A		24,100		754,330
Acuity Brands, Inc.		19,300		1,408,128
Aegion Corp. *		17,415		366,760
Aircastle Ltd.		45,700		637,972
Albany International Corp., Class A		21,300		618,765
AMETEK, Inc.		40,300		1,640,613
Apogee Enterprises, Inc.		22,895		583,365
Applied Industrial Technologies, Inc.		27,820		1,175,395
Armstrong World Industries, Inc. *		16,700		852,368
Astec Industries, Inc.		13,950		457,979
B/E Aerospace, Inc. *		19,800		1,242,252
Barnes Group, Inc.		30,165		837,682
Beacon Roofing Supply, Inc. *		20,280		773,276
Belden, Inc.		17,640		871,769
Brady Corp., Class A		28,000		948,640
Briggs & Stratton Corp.		49,700		1,117,753
Carlisle Cos., Inc.		26,900		1,745,003
Chart Industries, Inc. *		4,910		416,417
Chicago Bridge & Iron Co., N.V., NY Shares		34,598		1,861,026
CIRCOR International, Inc.		9,790		463,361

See financial notes 9

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
CLARCOR, Inc.		17,825		921,552
CNH Global N.V.		17,100		703,323
Comfort Systems USA, Inc.		44,400		569,652
Crane Co.		21,600		1,162,728
Cubic Corp.		6,090		261,687
Curtiss-Wright Corp.		29,000		952,360
Donaldson Co., Inc.		39,000		1,418,820
Dycom Industries, Inc. *		40,370		779,948
Encore Wire Corp.		16,240		531,860
EnerSys, Inc. *		22,400		1,026,816
EnPro Industries, Inc. *		7,770		382,906
ESCO Technologies, Inc.		9,500		341,715
Esterline Technologies Corp. *		11,500		862,960
Federal Signal Corp. *		52,500		407,400
Fortune Brands Home & Security, Inc. *		18,100		658,659
Franklin Electric Co., Inc.		13,960		451,885
FreightCar America, Inc.		19,435		405,803
Gardner Denver, Inc.		18,000		1,351,620
GATX Corp.		33,400		1,701,730
General Cable Corp. *		49,900		1,720,552
Gibraltar Industries, Inc. *		36,355		679,839
Graco, Inc.		20,240		1,225,127
GrafTech International Ltd. *		69,200		496,856
Granite Construction, Inc.		42,500		1,175,975
Griffon Corp.		38,908		400,752
H&E Equipment Services, Inc.		24,520		499,227
HEICO Corp.		8,810		387,728
Hexcel Corp. *		23,085		704,093
IDEX Corp.		24,900		1,295,547
Kaman Corp.		13,480		455,489
Kaydon Corp.		20,735		494,322
Kennametal, Inc.		35,900		1,435,641
Layne Christensen Co. *		23,700		484,191
Lincoln Electric Holdings, Inc.		31,000		1,635,560
MasTec, Inc. *		17,410		483,998
Meritor, Inc. *		92,200		534,760
Middleby Corp. *		2,908		434,979
Moog, Inc., Class A *		19,800		914,958
MRC Global, Inc. *		14,500		434,275
MSC Industrial Direct Co., Inc., Class A		12,900		1,016,520
Mueller Industries, Inc.		18,000		932,040
Mueller Water Products, Inc., Class A		127,600		755,392
National Presto Industries, Inc.		4,645		348,375
Navistar International Corp. *		50,200		1,662,624
Nordson Corp.		11,650		809,559
Orbital Sciences Corp. *		42,155		759,633
Polypore International, Inc. (b)*		8,400		352,212
Quanex Building Products Corp.		30,050		488,914
Raven Industries, Inc.		9,830		329,797
Regal-Beloit Corp.		14,900		1,171,438
Rush Enterprises, Inc., Class A *		26,460		605,669
Simpson Manufacturing Co., Inc.		18,285		525,511
Snap-on, Inc.		20,800		1,792,960
Spirit AeroSystems Holdings, Inc., Class A *		61,200		1,223,388
Standex International Corp.		5,950		314,755
TAL International Group, Inc.		11,190		463,266
Teledyne Technologies, Inc. *		12,400		930,744
Tennant Co.		7,480		357,694
The Babcock & Wilcox Co.		30,900		840,480
The Greenbrier Cos., Inc. *		15,120		341,107
The Manitowoc Co., Inc.		71,000		1,331,960
The Toro Co.		31,220		1,405,212
Titan International, Inc.		12,275		273,855
TransDigm Group, Inc.		9,100		1,335,880
Triumph Group, Inc.		11,100		886,890
Tutor Perini Corp. *		87,100		1,431,924
Universal Forest Products, Inc.		29,270		1,129,822
USG Corp. *		30,300		787,497
Valmont Industries, Inc.		6,050		881,667
WABCO Holdings, Inc. *		17,800		1,285,694
Wabtec Corp.		9,560		1,003,226
Watsco, Inc.		12,945		1,092,299
Watts Water Technologies, Inc., Class A		15,455		727,312
Woodward, Inc.		20,000		719,800
				81,565,716
Commercial & Professional Supplies 3.9%
ABM Industries, Inc.		58,400		1,316,920
Clean Harbors, Inc. *		9,330		531,530
Consolidated Graphics, Inc. *		14,520		517,928
Copart, Inc. *		27,700		976,425
Covanta Holding Corp.		52,000		1,040,000
Deluxe Corp.		29,600		1,128,944
EnergySolutions, Inc. *		117,800		486,514
FTI Consulting, Inc. *		23,500		778,320
G&K Services, Inc., Class A		17,190		807,758
Healthcare Services Group, Inc.		22,255		496,064
Heidrick & Struggles International, Inc.		22,670		299,697
Herman Miller, Inc.		41,210		1,033,959
HNI Corp.		42,100		1,449,503
Huron Consulting Group, Inc. *		7,800		325,884
ICF International, Inc. *		13,600		368,696
IHS, Inc., Class A *		4,910		478,381
Insperity, Inc.		18,360		507,287
Interface, Inc.		23,385		391,465
Kelly Services, Inc., Class A		80,200		1,365,004
Kforce, Inc.		29,400		444,528
Knoll, Inc.		31,500		490,140
Korn/Ferry International *		27,530		455,621
McGrath RentCorp		12,925		401,451
Mine Safety Appliances Co.		11,825		567,600
Navigant Consulting, Inc. *		44,025		542,828
Nielsen Holdings N.V.		26,700		924,354
Quad Graphics, Inc. (b)		39,400		823,460
Resources Connection, Inc.		44,260		502,794
Rollins, Inc.		13,022		316,695
Steelcase, Inc., Class A		93,200		1,183,640
Stericycle, Inc. *		10,800		1,169,856
Tetra Tech, Inc. *		22,395		588,765
The Corporate Executive Board Co.		17,370		978,973
Towers Watson & Co., Class A		13,215		963,638
TrueBlue, Inc. *		45,530		943,382
UniFirst Corp.		6,605		601,385
Verisk Analytics, Inc., Class A *		15,900		974,511
Viad Corp.		20,965		546,138
Waste Connections, Inc.		25,300		960,135
				28,680,173

10 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Consumer Durables & Apparel 4.6%
American Greetings Corp., Class A		66,700		1,229,948
Arctic Cat, Inc. *		7,800		350,922
Beazer Homes USA, Inc. (b)*		24,800		400,768
Blyth, Inc. (b)		15,944		262,757
Brunswick Corp.		31,200		987,792
Callaway Golf Co.		91,655		614,089
Carter’s, Inc. *		12,700		830,453
Columbia Sportswear Co. (b)		8,180		479,348
Crocs, Inc. *		25,660		411,073
Deckers Outdoor Corp. *		13,250		730,340
Ethan Allen Interiors, Inc.		21,165		619,711
Fifth & Pacific Cos., Inc. *		53,500		1,103,170
Fossil, Inc. *		13,200		1,295,184
G-III Apparel Group Ltd. *		9,500		386,270
Hanesbrands, Inc. *		34,200		1,715,472
Helen of Troy Ltd. *		11,730		409,142
JAKKS Pacific, Inc.		34,125		372,304
KB Home		80,200		1,807,708
La-Z-Boy, Inc.		38,920		702,895
Lennar Corp., Class A		43,400		1,788,948
M.D.C. Holdings, Inc.		19,200		721,920
Meritage Homes Corp. *		14,400		702,576
NACCO Industries, Inc., Class A		7,240		420,065
Oxford Industries, Inc.		5,530		326,989
Polaris Industries, Inc.		15,000		1,292,850
PulteGroup, Inc. *		98,900		2,075,911
PVH Corp.		14,889		1,718,340
Quiksilver, Inc. *		151,100		1,016,903
Skechers U.S.A., Inc., Class A *		34,045		707,455
Steven Madden Ltd. *		9,348		454,593
Tempur-Pedic International, Inc. *		29,415		1,426,628
The Ryland Group, Inc.		31,500		1,419,390
Toll Brothers, Inc. *		43,500		1,492,485
Tupperware Brands Corp.		18,900		1,517,670
Under Armour, Inc., Class A *		7,330		418,396
Wolverine World Wide, Inc.		24,290		1,160,333
				33,370,798
Consumer Services 5.2%
Ameristar Casinos, Inc.		32,175		849,098
Bally Technologies, Inc. *		12,675		675,324
Bob Evans Farms, Inc.		28,955		1,254,910
Boyd Gaming Corp. (b)*		101,700		1,220,400
Buffalo Wild Wings, Inc. *		3,400		306,000
Caesars Entertainment Corp. (b)*		113,200		1,801,012
Career Education Corp. *		224,300		491,217
CEC Entertainment, Inc.		25,380		846,931
Chipotle Mexican Grill, Inc. *		2,911		1,057,246
Choice Hotels International, Inc.		8,040		314,042
Coinstar, Inc. (b)*		8,425		444,924
Corinthian Colleges, Inc. *		246,685		493,370
Cracker Barrel Old Country Store, Inc.		19,320		1,598,537
DeVry, Inc.		36,700		1,027,967
DineEquity, Inc.		6,530		465,197
Domino’s Pizza, Inc.		32,200		1,777,440
Hillenbrand, Inc.		26,200		658,406
Hyatt Hotels Corp., Class A *		15,800		674,344
International Speedway Corp., Class A		18,750		616,312
ITT Educational Services, Inc. (b)*		50,435		923,465
Jack in the Box, Inc. *		40,900		1,466,265
Las Vegas Sands Corp.		21,900		1,231,875
LIFE TIME FITNESS, Inc. *		11,785		544,231
Lincoln Educational Services Corp.		65,860		366,840
Matthews International Corp., Class A		17,815		655,770
Orient-Express Hotels Ltd., Class A *		28,490		287,749
Panera Bread Co., Class A *		4,875		863,996
Papa John’s International, Inc. *		9,710		611,730
Penn National Gaming, Inc. *		27,600		1,615,980
Pinnacle Entertainment, Inc. *		30,675		584,665
Red Robin Gourmet Burgers, Inc. *		11,580		560,125
Regis Corp.		65,500		1,228,125
Ruby Tuesday, Inc. *		105,150		1,013,646
Scientific Games Corp., Class A *		36,870		327,406
Six Flags Entertainment Corp.		8,700		633,969
Sonic Corp. *		83,380		1,044,751
Sotheby’s		16,620		589,678
Steiner Leisure Ltd. *		8,560		414,561
Stewart Enterprises, Inc., Class A		44,740		398,633
Strayer Education, Inc. (b)		12,400		587,264
Texas Roadhouse, Inc.		26,110		613,585
The Cheesecake Factory, Inc.		33,835		1,347,310
The Wendy’s Co.		180,300		1,025,907
Vail Resorts, Inc.		12,360		745,308
Weight Watchers International, Inc. (b)		19,692		830,412
WMS Industries, Inc. *		30,712		779,471
				37,865,394
Diversified Financials 2.8%
Affiliated Managers Group, Inc. *		6,400		996,352
American Capital Ltd. *		40,400		611,252
Apollo Investment Corp.		46,000		405,260
Ares Capital Corp.		38,700		702,792
Cash America International, Inc.		15,405		672,120
CBOE Holdings, Inc.		16,400		615,492
E*TRADE Financial Corp. *		115,500		1,188,495
Eaton Vance Corp.		49,700		1,982,036
Ezcorp, Inc., Class A *		17,200		290,680
First Cash Financial Services, Inc. *		6,590		339,187
Greenhill & Co., Inc.		13,135		606,706
IntercontinentalExchange, Inc. *		5,800		944,994
Investment Technology Group, Inc. *		49,255		536,387
Knight Capital Group, Inc., Class A *		251,400		889,956
Lazard Ltd., Class A		18,600		630,540
Leucadia National Corp.		37,927		1,171,565
LPL Financial Holdings, Inc.		13,900		480,384
MSCI, Inc. *		28,400		968,440
Nelnet, Inc., Class A		14,940		507,960
Piper Jaffray Cos., Inc. *		12,005		405,289
Raymond James Financial, Inc.		23,700		981,654
SEI Investments Co.		57,900		1,659,414
Stifel Financial Corp. *		8,560		275,803
The NASDAQ OMX Group, Inc.		42,100		1,241,108
Waddell & Reed Financial, Inc., Class A		24,300		1,041,741

See financial notes 11

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
World Acceptance Corp. *		6,160		547,378
				20,692,985
Energy 6.6%
Alpha Natural Resources, Inc. *		156,200		1,159,004
Atwood Oceanics, Inc. *		11,700		573,885
Basic Energy Services, Inc. *		24,885		341,671
Berry Petroleum Co., Class A		16,020		767,518
Bill Barrett Corp. (b)*		29,900		593,814
Bristow Group, Inc.		13,700		865,840
Cabot Oil & Gas Corp.		20,600		1,401,830
Cal Dive International, Inc. (b)*		282,743		472,181
CARBO Ceramics, Inc. (b)		5,280		373,032
Cloud Peak Energy, Inc. *		33,000		644,820
Comstock Resources, Inc. *		27,655		433,077
Concho Resources, Inc. *		5,800		499,554
Crosstex Energy, Inc.		31,100		572,551
Delek US Holdings, Inc.		12,800		461,952
Denbury Resources, Inc. *		74,500		1,332,805
Dresser-Rand Group, Inc. *		23,300		1,295,713
Dril-Quip, Inc. *		7,585		634,940
Energy XXI (Bermuda) Ltd.		13,000		295,620
EQT Corp.		26,100		1,960,632
EXCO Resources, Inc. (b)		75,400		547,404
Exterran Holdings, Inc. *		81,000		2,140,020
Forest Oil Corp. *		152,900		640,651
GulfMark Offshore, Inc., Class A		10,505		437,218
Helix Energy Solutions Group, Inc. *		65,800		1,516,032
Hercules Offshore, Inc. *		116,400		857,868
Hornbeck Offshore Services, Inc. *		10,380		466,270
ION Geophysical Corp. *		41,605		259,615
Key Energy Services, Inc. *		127,000		754,380
Lufkin Industries, Inc.		9,010		795,493
Matrix Service Co. *		23,100		347,193
McMoRan Exploration Co. *		22,260		368,403
Newpark Resources, Inc. *		48,740		511,770
Nordic American Tankers Ltd. (b)		42,085		374,977
Oceaneering International, Inc.		24,900		1,747,233
Oil States International, Inc. *		20,400		1,822,944
Parker Drilling Co. *		111,710		460,245
PDC Energy, Inc. *		9,555		413,732
Penn Virginia Corp.		114,800		462,644
Pioneer Energy Services Corp. *		43,800		308,790
Plains Exploration & Production Co. *		37,000		1,672,400
Quicksilver Resources, Inc. (b)*		126,400		318,528
Range Resources Corp.		16,200		1,191,024
Rosetta Resources, Inc. *		8,810		378,037
SandRidge Energy, Inc. (b)*		123,100		632,734
SemGroup Corp., Class A *		29,700		1,539,945
Ship Finance International Ltd.		29,800		491,104
SM Energy Co.		19,000		1,159,000
Stone Energy Corp. *		30,100		593,873
Superior Energy Services, Inc. *		67,800		1,870,602
Swift Energy Co. *		33,505		433,555
Targa Resources Corp.		9,800		644,448
Teekay Corp.		30,300		1,078,680
TETRA Technologies, Inc. *		81,160		740,991
Ultra Petroleum Corp. *		40,300		862,420
Unit Corp. *		28,600		1,202,058
W&T Offshore, Inc.		26,100		304,848
Western Refining, Inc.		38,200		1,180,762
Whiting Petroleum Corp. *		25,000		1,112,500
Willbros Group, Inc. *		64,200		609,900
				47,930,730
Food & Staples Retailing 1.3%
Harris Teeter Supermarkets, Inc.		35,500		1,483,545
Nash Finch Co.		62,900		1,292,595
PriceSmart, Inc.		4,540		405,104
Rite Aid Corp. *		459,800		1,218,470
Roundy’s, Inc. (b)		41,600		297,856
Spartan Stores, Inc.		45,400		761,812
Susser Holdings Corp. *		8,500		451,945
The Andersons, Inc.		15,025		819,163
The Pantry, Inc. *		93,600		1,367,496
United Natural Foods, Inc. *		22,100		1,103,674
Weis Markets, Inc.		14,500		606,535
				9,808,195
Food, Beverage & Tobacco 2.0%
B&G Foods, Inc.		11,900		367,234
Cal-Maine Foods, Inc.		9,300		396,924
Chiquita Brands International, Inc. *		139,700		1,205,611
Darling International, Inc. *		18,720		346,507
Dole Food Co., Inc. *		54,300		584,268
Flowers Foods, Inc.		49,700		1,637,118
Fresh Del Monte Produce, Inc.		43,300		1,100,253
Green Mountain Coffee Roasters, Inc. (b)*		9,980		572,852
J&J Snack Foods Corp.		5,935		445,244
Lancaster Colony Corp.		10,665		841,788
Monster Beverage Corp. *		14,110		795,804
Pilgrim’s Pride Corp. *		40,100		392,579
Post Holdings, Inc. *		18,700		818,873
Sanderson Farms, Inc.		18,900		1,157,814
Seaboard Corp.		202		554,688
Snyders-Lance, Inc.		14,760		371,657
The Hain Celestial Group, Inc. *		7,070		461,318
TreeHouse Foods, Inc. *		11,385		725,338
Universal Corp.		25,800		1,484,790
Vector Group Ltd.		26,326		429,377
				14,690,037
Health Care Equipment & Services 4.4%
Alere, Inc. *		36,000		924,480
Amedisys, Inc. *		58,870		591,055
AmSurg Corp. *		17,725		594,851
Analogic Corp.		4,365		346,930
Brookdale Senior Living, Inc. *		37,600		969,704
Catamaran Corp. *		13,400		773,582
Centene Corp. *		25,000		1,155,000
Cerner Corp. *		15,100		1,461,227
Chemed Corp.		13,495		1,101,462
CONMED Corp.		14,395		450,995
Edwards Lifesciences Corp. *		10,500		669,795
Gentiva Health Services, Inc. *		48,625		510,076
Haemonetics Corp. *		14,700		565,950
Hanger, Inc. *		11,300		343,407

12 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Health Management Associates, Inc., Class A *		166,300		1,910,787
HealthSouth Corp. *		20,300		558,250
Healthways, Inc. *		41,460		575,879
Hill-Rom Holdings, Inc.		40,300		1,373,021
Hologic, Inc. *		49,900		1,016,463
IDEXX Laboratories, Inc. *		11,500		1,011,540
Integra LifeSciences Holdings Corp. *		8,120		284,444
Intuitive Surgical, Inc. *		1,918		944,212
Invacare Corp.		49,865		670,684
Magellan Health Services, Inc. *		30,100		1,539,916
Masimo Corp.		16,200		324,972
MEDNAX, Inc. *		13,700		1,215,601
Molina Healthcare, Inc. *		24,957		828,573
MWI Veterinary Supply, Inc. *		3,200		376,672
PharMerica Corp. *		52,140		672,085
ResMed, Inc. (b)		20,240		971,925
Sirona Dental Systems, Inc. *		8,090		594,939
STERIS Corp.		33,200		1,380,788
Teleflex, Inc.		17,700		1,382,901
The Cooper Cos., Inc.		7,700		850,080
Triple-S Management Corp., Class B *		19,700		355,191
Universal American Corp.		66,200		566,010
Vanguard Health Systems, Inc. *		34,400		503,272
VCA Antech, Inc. *		37,900		913,390
West Pharmaceutical Services, Inc.		11,940		762,488
				32,042,597
Household & Personal Products 0.4%
Central Garden & Pet Co., Class A *		57,530		506,264
Elizabeth Arden, Inc. *		8,870		363,227
Nu Skin Enterprises, Inc., Class A		19,910		1,010,034
Spectrum Brands Holdings, Inc.		8,900		498,400
WD-40 Co.		5,515		297,424
				2,675,349
Insurance 4.8%
Alleghany Corp. *		2,500		984,350
Allied World Assurance Co. Holdings AG		18,800		1,707,228
Alterra Capital Holdings Ltd.		41,300		1,344,315
American Equity Investment Life Holding Co.		39,215		597,637
Argo Group International Holdings Ltd.		15,459		640,776
Arthur J. Gallagher & Co.		38,500		1,634,325
Assured Guaranty Ltd.		22,100		455,923
Brown & Brown, Inc.		32,100		994,779
CNA Financial Corp.		9,300		313,503
CNO Financial Group, Inc.		145,600		1,648,192
Employers Holdings, Inc.		14,900		337,485
Erie Indemnity Co., Class A		11,700		930,969
First American Financial Corp.		64,700		1,732,019
HCC Insurance Holdings, Inc.		44,100		1,878,660
Horace Mann Educators Corp.		19,790		446,264
Infinity Property & Casualty Corp.		12,865		729,960
Markel Corp. *		2,400		1,287,000
MBIA, Inc. *		33,800		319,748
Mercury General Corp.		19,900		909,629
Montpelier Re Holdings Ltd.		30,400		783,104
National Financial Partners Corp. *		32,785		830,772
Old Republic International Corp.		142,800		1,927,800
OneBeacon Insurance Group Ltd., Class A		27,700		376,443
Primerica, Inc.		44,000		1,494,240
ProAssurance Corp.		17,100		837,729
Protective Life Corp.		50,100		1,906,806
RLI Corp.		12,500		898,125
Safety Insurance Group, Inc.		9,505		472,113
Selective Insurance Group, Inc.		41,700		977,031
StanCorp Financial Group, Inc.		38,000		1,640,840
Symetra Financial Corp.		25,900		353,017
The Hanover Insurance Group, Inc.		35,200		1,775,136
Tower Group International Ltd.		18,029		341,109
Validus Holdings Ltd.		41,727		1,611,079
				35,118,106
Materials 6.1%
A. Schulman, Inc.		29,133		756,584
A.M. Castle & Co. (b)*		27,178		470,723
AK Steel Holding Corp. (b)		321,300		1,076,355
AMCOL International Corp.		12,120		372,932
Axiall Corp.		18,524		971,584
Boise, Inc.		84,300		673,557
Buckeye Technologies, Inc.		13,580		510,472
Cabot Corp.		36,700		1,378,452
Carpenter Technology Corp.		21,900		984,624
Century Aluminum Co. *		69,900		570,384
Chemtura Corp. *		52,000		1,105,520
Clearwater Paper Corp. *		11,660		536,593
Compass Minerals International, Inc.		9,730		842,034
Crown Holdings, Inc. *		41,000		1,749,880
Cytec Industries, Inc.		22,000		1,602,920
Eagle Materials, Inc.		15,570		1,054,867
Ferro Corp. *		195,930		1,379,347
Graphic Packaging Holding Co. *		72,600		545,952
Greif, Inc., Class A		22,200		1,069,374
H.B. Fuller Co.		28,180		1,068,022
Horsehead Holding Corp. *		30,000		321,000
Innophos Holdings, Inc.		10,350		531,059
Innospec, Inc.		9,980		439,220
Kaiser Aluminum Corp.		13,880		874,440
KapStone Paper & Packaging Corp.		13,400		396,372
Koppers Holdings, Inc.		9,260		406,607
Kraton Performance Polymers, Inc. *		18,800		426,948
Louisiana-Pacific Corp. *		44,300		802,716
Materion Corp.		17,360		459,866
Minerals Technologies, Inc.		21,420		870,295
Myers Industries, Inc.		25,205		373,538
NewMarket Corp.		2,595		697,276
Olin Corp.		43,900		1,061,063
Olympic Steel, Inc.		18,800		376,000
OM Group, Inc. *		36,600		895,602
P.H. Glatfelter Co.		32,345		776,280
PolyOne Corp.		34,200		770,526
Resolute Forest Products (b)*		51,800		757,834
Rock-Tenn Co., Class A		17,600		1,762,464
Rockwood Holdings, Inc.		21,600		1,401,624
RTI International Metals, Inc. *		14,680		426,014

See financial notes 13

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Schnitzer Steel Industries, Inc., Class A		52,310		1,283,164
Schweitzer-Mauduit International, Inc.		13,472		542,787
Sensient Technologies Corp.		23,700		932,595
Silgan Holdings, Inc.		22,900		1,096,223
Stepan Co.		8,530		485,698
Stillwater Mining Co. *		33,470		416,367
SunCoke Energy, Inc. *		36,000		544,680
Texas Industries, Inc. *		7,485		476,645
The Scotts Miracle-Gro Co., Class A		28,100		1,274,335
Tredegar Corp.		21,375		632,700
W.R. Grace & Co. *		8,400		647,724
Walter Energy, Inc.		28,400		508,928
Wausau Paper Corp.		43,210		439,878
Westlake Chemical Corp.		5,900		490,526
Worthington Industries, Inc.		46,000		1,480,280
				44,799,450
Media 2.1%
AMC Networks, Inc., Class A *		6,200		390,662
Belo Corp., Class A		68,900		738,608
Central European Media Enterprises Ltd., Class A (b)*		76,500		283,050
Cinemark Holdings, Inc.		46,100		1,424,029
DreamWorks Animation SKG, Inc., Class A *		51,900		1,000,632
Harte-Hanks, Inc.		97,435		772,660
John Wiley & Sons, Inc., Class A		18,400		702,328
Live Nation Entertainment, Inc. *		72,600		916,938
Meredith Corp. (b)		27,000		1,048,140
National CineMedia, Inc.		22,200		360,528
Regal Entertainment Group, Class A (b)		69,200		1,241,448
Scholastic Corp.		35,900		985,455
Scripps Networks Interactive, Class A		15,300		1,018,674
Sinclair Broadcast Group, Inc., Class A		29,819		799,149
Starz - Liberty Capital *		25,600		598,528
The E.W. Scripps Co., Class A *		56,700		787,563
The Madison Square Garden Co., Class A *		11,000		662,970
The New York Times Co., Class A *		129,100		1,143,826
Valassis Communications, Inc.		22,000		563,860
				15,439,048
Pharmaceuticals, Biotechnology & Life Sciences 1.7%
Bio-Rad Laboratories, Inc., Class A *		6,300		754,425
Charles River Laboratories International, Inc. *		33,900		1,474,311
Covance, Inc. *		27,300		2,035,488
Cubist Pharmaceuticals, Inc. *		6,240		286,541
Endo Health Solutions, Inc. *		47,200		1,729,408
Illumina, Inc. *		8,460		547,277
Impax Laboratories, Inc. *		19,000		332,500
PAREXEL International Corp. *		13,120		537,264
PDL Biopharma, Inc. (b)		80,850		625,779
PerkinElmer, Inc.		48,100		1,474,265
Perrigo Co.		9,300		1,110,513
QIAGEN N.V. *		38,600		767,368
Techne Corp.		8,165		523,703
ViroPharma, Inc. *		12,960		353,160
				12,552,002
Real Estate 8.8%
Alexandria Real Estate Equities, Inc.		11,000		800,470
American Campus Communities, Inc.		7,960		355,334
American Capital Agency Corp.		13,000		433,030
Anworth Mortgage Asset Corp.		64,255		405,449
Ashford Hospitality Trust		38,985		502,127
BioMed Realty Trust, Inc.		32,700		736,077
Brandywine Realty Trust		76,100		1,136,173
BRE Properties, Inc.		14,000		706,720
Camden Property Trust		15,700		1,135,738
Capstead Mortgage Corp.		35,550		472,104
CBL & Associates Properties, Inc.		44,200		1,066,988
CBRE Group, Inc., Class A *		66,200		1,603,364
Chimera Investment Corp.		301,300		994,290
Colonial Properties Trust		35,000		812,350
CommonWealth REIT		67,500		1,507,275
Corporate Office Properties Trust		27,400		794,326
Corrections Corp. of America		36,700		1,328,540
Cousins Properties, Inc.		40,183		438,798
CubeSmart		22,375		393,129
DCT Industrial Trust, Inc.		71,800		562,194
DDR Corp.		67,700		1,241,618
DiamondRock Hospitality Co.		63,700		635,726
Digital Realty Trust, Inc.		11,900		839,188
Douglas Emmett, Inc.		27,200		711,824
EastGroup Properties, Inc.		6,950		438,336
EPR Properties		12,600		712,404
Equity Lifestyle Properties, Inc.		3,870		314,438
Essex Property Trust, Inc.		5,000		785,250
Extra Space Storage, Inc.		11,265		490,929
Federal Realty Investment Trust		10,400		1,216,904
FelCor Lodging Trust, Inc. *		69,650		416,507
First Industrial Realty Trust, Inc.		31,300		561,522
Forest City Enterprises, Inc., Class A *		22,500		420,075
General Growth Properties, Inc.		77,400		1,758,528
Glimcher Realty Trust		33,925		425,419
Hatteras Financial Corp.		18,900		516,537
Health Care REIT, Inc.		19,800		1,484,406
Healthcare Realty Trust, Inc.		18,800		564,376
Highwoods Properties, Inc.		22,400		919,072
Home Properties, Inc.		12,200		786,412
HomeBanc Corp. (c)(d)*		6,875		—
Inland Real Estate Corp.		37,530		424,840
iStar Financial, Inc. *		162,400		1,896,832
Jones Lang LaSalle, Inc.		16,300		1,614,026
Kilroy Realty Corp.		11,800		667,762
LaSalle Hotel Properties		22,640		587,055
Lexington Realty Trust		55,000		704,550
Liberty Property Trust		34,900		1,500,351
Mack-Cali Realty Corp.		47,100		1,307,967
MFA Financial, Inc.		91,400		847,278
Mid-America Apartment Communities, Inc.		8,045		552,933
National Retail Properties, Inc.		15,800		626,944
NorthStar Realty Finance Corp.		62,732		625,438

14 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Omega Healthcare Investors, Inc. (b)		18,290		601,192
Pennsylvania Real Estate Investment Trust		32,700		677,871
Piedmont Office Realty Trust, Inc., Class A		77,400		1,588,248
Post Properties, Inc.		8,920		440,916
Potlatch Corp.		32,900		1,557,815
Prologis, Inc.		41,900		1,757,705
PS Business Parks, Inc.		4,750		379,050
RAIT Financial Trust		79,520		679,101
Realty Income Corp.		17,100		871,587
Redwood Trust, Inc.		45,200		1,031,464
Regency Centers Corp.		21,100		1,187,086
Senior Housing Properties Trust		26,400		750,552
SL Green Realty Corp.		13,000		1,179,100
Sovran Self Storage, Inc.		6,470		443,842
Sun Communities, Inc.		6,855		350,633
Sunstone Hotel Investors, Inc. *		51,500		639,115
Tanger Factory Outlet Centers, Inc.		12,880		478,106
Taubman Centers, Inc.		11,300		966,263
The Geo Group, Inc.		20,536		769,073
The Macerich Co.		24,500		1,716,225
UDR, Inc.		44,400		1,091,352
Washington Real Estate Investment Trust		19,700		562,632
Weingarten Realty Investors		39,300		1,338,951
				63,837,802
Retailing 5.8%
Aeropostale, Inc. *		78,800		1,155,208
ANN, Inc. *		46,700		1,379,518
Asbury Automotive Group, Inc. *		20,600		825,854
Ascena Retail Group, Inc. *		36,500		675,250
AutoNation, Inc. *		32,500		1,479,075
Barnes & Noble, Inc. (b)*		59,700		1,082,361
Brown Shoe Co., Inc.		50,042		846,210
Cabela’s, Inc. *		11,000		706,200
Chico’s FAS, Inc.		77,100		1,408,617
Dick’s Sporting Goods, Inc.		29,400		1,414,140
DSW, Inc., Class A		7,268		480,560
Express, Inc. *		24,300		442,503
Fred’s, Inc., Class A		65,170		927,369
Genesco, Inc. *		13,800		849,390
GNC Holdings, Inc., Class A		11,900		539,427
Group 1 Automotive, Inc.		27,100		1,639,008
Guess?, Inc.		46,600		1,289,888
Hibbett Sports, Inc. *		7,885		432,492
Hot Topic, Inc.		44,700		623,565
HSN, Inc.		12,300		646,734
Jos. A. Bank Clothiers, Inc. *		10,885		475,457
Lithia Motors, Inc., Class A		16,035		794,053
LKQ Corp. *		48,100		1,158,248
Monro Muffler Brake, Inc.		9,640		398,711
Netflix, Inc. *		6,800		1,469,276
Nutrisystem, Inc.		77,730		629,613
OfficeMax, Inc.		149,700		1,723,047
Penske Automotive Group, Inc.		36,800		1,137,856
Pier 1 Imports, Inc.		21,685		503,309
Pool Corp.		16,780		822,556
Priceline.com, Inc. *		2,411		1,678,032
Saks, Inc. (b)*		141,200		1,630,860
Sally Beauty Holdings, Inc. *		12,065		362,674
Select Comfort Corp. *		12,970		275,223
Sonic Automotive, Inc., Class A		49,700		1,092,903
Stage Stores, Inc.		40,055		1,109,123
The Buckle, Inc. (b)		13,122		637,073
The Cato Corp., Class A		18,695		448,867
The Children’s Place Retail Stores, Inc. *		22,660		1,108,527
The Finish Line, Inc., Class A		38,052		737,828
The Men’s Wearhouse, Inc.		43,500		1,457,250
The Pep Boys - Manny, Moe & Jack *		57,715		669,494
The Wet Seal, Inc., Class A *		115,160		375,422
TripAdvisor, Inc. *		6,400		336,512
Ulta Salon, Cosmetics & Fragrance, Inc. *		5,900		517,135
Urban Outfitters, Inc. *		31,100		1,288,784
Vitamin Shoppe, Inc. *		5,400		265,410
				41,946,612
Semiconductors & Semiconductor Equipment 3.4%
Advanced Micro Devices, Inc. (b)*		398,700		1,124,334
Amkor Technology, Inc. (b)*		145,000		613,350
Applied Micro Circuits Corp. *		42,440		316,602
Atmel Corp. *		169,000		1,093,430
ATMI, Inc. *		20,715		450,551
Avago Technologies Ltd.		32,500		1,038,700
Brooks Automation, Inc.		53,990		524,783
Cabot Microelectronics Corp. *		10,330		346,158
Cirrus Logic, Inc. *		9,935		191,845
Cree, Inc. *		17,000		961,690
Cymer, Inc. *		9,120		955,411
Cypress Semiconductor Corp. *		58,705		592,334
Entegris, Inc. *		76,345		723,751
Fairchild Semiconductor International, Inc. *		69,300		893,970
First Solar, Inc. *		44,100		2,053,296
GT Advanced Technologies, Inc. (b)*		124,500		489,285
Integrated Device Technology, Inc. *		147,180		1,046,450
International Rectifier Corp. *		33,200		704,172
Intersil Corp., Class A		149,300		1,158,568
Micrel, Inc.		32,750		329,465
Microsemi Corp. *		17,845		371,176
MKS Instruments, Inc.		25,150		675,781
OmniVision Technologies, Inc. *		24,980		334,982
ON Semiconductor Corp. *		180,800		1,421,088
Photronics, Inc. *		57,725		455,450
PMC-Sierra, Inc. *		60,225		346,896
RF Micro Devices, Inc. *		129,345		725,626
Semtech Corp. *		13,805		442,726
Silicon Laboratories, Inc. *		21,190		841,455
Skyworks Solutions, Inc. *		28,600		631,202
Spansion, Inc., Class A *		34,800		452,052
Teradyne, Inc. *		68,000		1,117,920
Tessera Technologies, Inc.		21,990		447,936
TriQuint Semiconductor, Inc. *		85,260		497,918
Veeco Instruments, Inc. *		9,660		367,756
				24,738,109

See financial notes 15

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Software & Services 5.0%
Activision Blizzard, Inc.		85,800		1,282,710
Acxiom Corp. *		59,415		1,181,764
Akamai Technologies, Inc. *		23,700		1,040,667
ANSYS, Inc. *		7,300		590,278
Broadridge Financial Solutions, Inc.		63,800		1,606,484
CACI International, Inc., Class A *		21,200		1,239,988
Cadence Design Systems, Inc. *		36,700		506,460
Citrix Systems, Inc. *		20,700		1,286,919
CSG Systems International, Inc. *		31,645		683,849
EarthLink, Inc.		134,375		764,594
Electronic Arts, Inc. *		83,700		1,473,957
Equinix, Inc. *		2,900		620,890
Euronet Worldwide, Inc. *		19,095		582,970
FactSet Research Systems, Inc.		9,465		890,373
Fair Isaac Corp.		27,005		1,257,893
Gartner, Inc. *		16,100		931,385
Genpact Ltd.		27,350		508,710
Global Cash Access Holdings, Inc. *		48,435		345,342
Global Payments, Inc.		21,600		1,002,240
Heartland Payment Systems, Inc.		15,165		498,777
Informatica Corp. *		8,055		265,251
j2 Global, Inc.		11,785		479,650
Jack Henry & Associates, Inc.		21,380		992,032
Lender Processing Services, Inc.		58,100		1,611,694
Manhattan Associates, Inc. *		6,095		427,930
ManTech International Corp., Class A		25,700		685,933
MAXIMUS, Inc.		10,390		827,979
Mentor Graphics Corp.		22,620		413,041
MICROS Systems, Inc. *		13,940		591,195
MicroStrategy, Inc., Class A *		3,528		318,190
Monster Worldwide, Inc. *		142,800		625,464
NeuStar, Inc., Class A *		14,175		621,857
Nuance Communications, Inc. *		18,200		346,528
Progress Software Corp. *		17,825		402,310
PTC, Inc. *		26,740		642,027
Rackspace Hosting, Inc. *		5,220		251,604
Red Hat, Inc. *		8,500		407,405
Rovi Corp. *		18,369		429,651
Salesforce.com, Inc. *		12,853		528,387
Sapient Corp. *		33,880		395,718
Solera Holdings, Inc.		7,660		441,063
Sykes Enterprises, Inc. *		28,755		442,539
Synopsys, Inc. *		27,500		978,175
Take-Two Interactive Software, Inc. *		39,655		605,135
TeleTech Holdings, Inc. *		23,110		492,012
TIBCO Software, Inc. *		35,430		687,696
Unisys Corp. *		36,600		700,158
United Online, Inc.		121,527		826,384
ValueClick, Inc. *		32,580		1,005,419
VistaPrint N.V. (b)*		8,120		331,296
WEX, Inc. *		5,400		409,212
				36,479,185
Technology Hardware & Equipment 4.5%
ADTRAN, Inc.		38,345		805,245
ARRIS Group, Inc. *		52,805		871,811
Avid Technology, Inc. *		44,325		292,102
AVX Corp.		34,300		387,933
Benchmark Electronics, Inc. *		88,200		1,573,488
Black Box Corp.		24,040		522,149
Brocade Communications Systems, Inc. *		167,500		974,850
Checkpoint Systems, Inc. *		41,180		476,453
Cognex Corp.		10,165		403,550
Coherent, Inc.		10,840		606,281
Comtech Telecommunications Corp.		14,570		358,568
Diebold, Inc.		46,900		1,373,701
Dolby Laboratories, Inc., Class A (b)		11,100		364,635
EchoStar Corp., Class A *		18,800		738,276
Electronics for Imaging, Inc. *		26,702		713,477
Emulex Corp. *		63,565		381,390
Extreme Networks, Inc. *		77,665		258,624
F5 Networks, Inc. *		7,240		553,353
FEI Co.		5,720		365,394
Finisar Corp. *		22,130		284,149
FLIR Systems, Inc.		46,400		1,127,984
Gerber Scientific, Inc. (b)(c)(d)*		19,700		—
Insight Enterprises, Inc. *		59,400		1,076,328
InterDigital, Inc.		17,300		768,293
Intermec, Inc. *		58,035		571,064
Itron, Inc. *		19,600		777,140
JDS Uniphase Corp. *		54,200		731,700
KEMET Corp. *		65,700		409,311
Littelfuse, Inc.		6,045		422,062
MTS Systems Corp.		8,180		498,571
National Instruments Corp.		22,042		602,408
NCR Corp. *		63,800		1,739,826
NETGEAR, Inc. *		11,250		335,137
Newport Corp. *		20,330		308,000
Plantronics, Inc.		16,310		714,704
Plexus Corp. *		30,280		816,652
Polycom, Inc. *		77,540		814,170
QLogic Corp. *		115,480		1,254,113
Rofin-Sinar Technologies, Inc. *		19,510		485,799
Sanmina Corp. *		130,600		1,648,172
ScanSource, Inc. *		27,140		786,246
Synaptics, Inc. *		11,805		486,720
SYNNEX Corp. *		41,300		1,428,980
Trimble Navigation Ltd. *		32,300		928,302
ViaSat, Inc. *		7,815		378,793
Zebra Technologies Corp., Class A *		26,520		1,237,158
				32,653,062
Telecommunication Services 1.2%
Cincinnati Bell, Inc. *		176,700		621,984
Consolidated Communications Holdings, Inc.		28,614		527,356
General Communication, Inc., Class A *		33,860		328,781
IDT Corp., Class B		34,400		508,776
Leap Wireless International, Inc. *		102,500		586,300
Level 3 Communications, Inc. *		44,100		887,733
MetroPCS Communications, Inc. *		155,400		1,839,936
NTELOS Holdings Corp.		21,020		309,414
Premiere Global Services, Inc. *		53,500		600,805
SBA Communications Corp., Class A *		8,605		679,709
tw telecom, Inc. *		32,100		869,268
United States Cellular Corp. *		12,600		484,344

16 See financial notes

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
USA Mobility, Inc.		48,905		663,641
				8,908,047
Transportation 3.4%
Air Transport Services Group, Inc. *		65,730		379,262
Alaska Air Group, Inc. *		25,700		1,584,148
AMERCO		4,200		674,940
Arkansas Best Corp.		80,640		847,526
Atlas Air Worldwide Holdings, Inc. *		16,200		605,880
Con-way, Inc.		46,600		1,575,080
Copa Holdings S.A., Class A		6,400		803,712
Forward Air Corp.		12,025		443,602
Genco Shipping & Trading Ltd. (b)*		116,345		198,950
Genesee & Wyoming, Inc., Class A *		5,265		448,578
Hawaiian Holdings, Inc. *		47,940		263,191
Heartland Express, Inc.		32,465		440,550
Hub Group, Inc., Class A *		24,810		909,286
JetBlue Airways Corp. *		160,500		1,105,845
Kansas City Southern		15,300		1,668,771
Kirby Corp. *		15,400		1,153,306
Knight Transportation, Inc.		35,725		558,025
Landstar System, Inc.		25,270		1,381,258
Matson, Inc.		38,500		906,290
Old Dominion Freight Line, Inc. *		20,175		776,738
Republic Airways Holdings, Inc. *		122,500		1,370,775
Saia, Inc. *		15,300		626,076
SkyWest, Inc.		138,300		1,979,073
Swift Transportation Co. *		40,200		563,604
US Airways Group, Inc. *		57,000		963,300
Uti Worldwide, Inc.		94,800		1,392,612
Werner Enterprises, Inc.		44,000		1,010,240
				24,630,618
Utilities 3.8%
ALLETE, Inc.		16,400		842,140
American States Water Co.		6,515		361,452
Aqua America, Inc.		34,900		1,107,377
Atlantic Power Corp. (b)		48,800		229,360
Avista Corp.		34,700		973,335
Black Hills Corp.		21,400		1,003,446
California Water Service Group		17,780		356,489
CH Energy Group, Inc.		8,205		533,079
Cleco Corp.		19,600		970,592
El Paso Electric Co.		20,090		752,571
Hawaiian Electric Industries, Inc.		49,000		1,386,700
IDACORP, Inc.		20,800		1,023,568
ITC Holdings Corp.		9,300		857,646
MGE Energy, Inc.		9,400		524,990
New Jersey Resources Corp.		26,000		1,227,200
Northwest Natural Gas Co.		15,605		693,954
NorthWestern Corp.		21,300		916,326
Otter Tail Corp.		25,080		782,496
Piedmont Natural Gas Co., Inc.		38,400		1,322,112
PNM Resources, Inc.		52,400		1,258,124
Portland General Electric Co.		45,700		1,473,825
South Jersey Industries, Inc.		11,040		681,168
Southwest Gas Corp.		26,000		1,317,420
The Empire District Electric Co.		24,810		572,367
The Laclede Group, Inc.		17,540		819,294
UIL Holdings Corp.		18,000		749,520
UNS Energy Corp.		22,800		1,161,888
Vectren Corp.		51,300		1,926,828
WGL Holdings, Inc.		32,700		1,511,394
				27,336,661
Total Common Stock
(Cost $579,997,059)				718,431,793
Warrants 0.0% of net assets
Energy 0.0%
Magnum Hunter Resources Corp. (d)*		1,535		215
Total Warrants
(Cost $—)				215
Other Investment Company 1.1% of net assets
Money Market Fund 1.1%
State Street Institutional U.S. Government Money Market Fund		7,889,934		7,889,934
Total Other Investment Company
(Cost $7,889,934)				7,889,934
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investment 0.1% of net assets
U.S. Treasury Obligation 0.1%
U.S. Treasury Bill
0.09%, 06/20/13 (a)(e)		682,000		681,920
Total Short-Term Investment
(Cost $681,920)				681,920
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 2.7% of net assets
State Street Institutional U.S. Government Money Market Fund		19,734,121		19,734,121
Total Collateral Invested for Securities on Loan
(Cost $19,734,121)				19,734,121
End of Collateral Invested for Securities on Loan

See financial notes 17

 Schwab Fundamental US Small Company Index Fund

Portfolio Holdings (Unaudited) continued

At 04/30/13 tax basis cost of the fund’s investments was $592,682,666 and the unrealized appreciation and depreciation were $153,300,527 and ($18,979,331), respectively, with a net unrealized appreciation of $134,321,196.

*	Non-income producing security.
(a)	All or a portion of this security is held as collateral for open futures contracts.
(b)	All or a portion of this security is on loan.
(c)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(d)	Illiquid security. At the period end, the value of these amounted to $215 or 0.0% of net assets.
(e)	The rate shown is the purchase yield.

REIT — Real Estate Investment Trust

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
Russell 2000 Index, mini, Long, expires 06/21/13		90		8,505,900		137,312

18 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.5%	Common Stock		505,169,197		576,984,942
	0	.4%	Preferred Stock		1,413,091		2,273,025
	0	.0%	Rights		91,567		4,776
	0	.2%	Other Investment Company		935,189		1,238,800
	2	.3%	Short-Term Investments		13,912,611		13,912,611
	99	.4%	Total Investments		521,521,655		594,414,154
	2	.4%	Collateral Invested for Securities on Loan		14,315,517		14,315,517
	(1	.8)%	Other Assets and Liabilities, Net				(10,726,220	)
	100	.0%	Total Net Assets				598,003,451

	Number		Value
Security	of Shares		($)
Common Stock 96.5% of net assets
Australia 4.8%
Banks 1.4%
Australia & New Zealand Banking Group Ltd.		57,455		1,898,728
Commonwealth Bank of Australia		27,234		2,075,799
National Australia Bank Ltd.		60,369		2,130,294
Westpac Banking Corp.		57,152		2,004,894
				8,109,715
Capital Goods 0.1%
CSR Ltd.		65,468		137,880
Leighton Holdings Ltd.		7,471		155,165
				293,045
Commercial & Professional Supplies 0.1%
Brambles Ltd.		64,907		587,654
Downer EDI Ltd.		36,336		185,243
				772,897
Consumer Services 0.1%
Crown Ltd.		14,363		192,190
TABCORP Holdings Ltd.		97,533		349,129
Tatts Group Ltd.		62,367		211,499
				752,818
Diversified Financials 0.1%
BGP Holdings plc (a)(b)		453,854		—
Macquarie Group Ltd.		11,574		470,850
				470,850
Energy 0.3%
Caltex Australia Ltd.		16,847		376,330
Origin Energy Ltd.		26,350		337,343
Santos Ltd.		19,558		251,223
Woodside Petroleum Ltd.		12,215		476,552
WorleyParsons Ltd.		5,441		128,635
				1,570,083
Food & Staples Retailing 0.6%
Metcash Ltd.		64,674		274,445
Wesfarmers Ltd.		37,058		1,667,176
Woolworths Ltd.		43,609		1,647,079
				3,588,700
Food, Beverage & Tobacco 0.0%
Coca-Cola Amatil Ltd.		12,534		196,904
Health Care Equipment & Services 0.0%
Sonic Healthcare Ltd.		10,022		137,737
Insurance 0.4%
AMP Ltd.		82,225		460,840
Insurance Australia Group Ltd.		61,429		370,883
QBE Insurance Group Ltd.		55,089		764,578
Suncorp Group Ltd.		75,541		1,017,408
				2,613,709
Materials 1.1%
Amcor Ltd.		40,683		417,809
Arrium Ltd.		284,755		251,782
BHP Billiton Ltd.		94,505		3,177,160
BlueScope Steel Ltd. *		127,827		658,210
Boral Ltd.		48,061		249,464
Incitec Pivot Ltd.		50,982		152,974
Newcrest Mining Ltd.		6,844		119,896
Orica Ltd.		11,838		280,718
Rio Tinto Ltd.		15,111		879,426
Sims Metal Management Ltd.		21,826		218,950
				6,406,389
Media 0.0%
Fairfax Media Ltd. (c)		279,941		188,836
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
CSL Ltd.		6,631		433,355
Real Estate 0.2%
Lend Lease Group		28,593		319,584
Mirvac Group		87,621		160,902
Stockland		72,409		290,991
Westfield Group		53,599		648,341
				1,419,818
Telecommunication Services 0.2%
Telstra Corp., Ltd.		193,065		997,133
Transportation 0.1%
Asciano Ltd.		33,238		186,207
Qantas Airways Ltd. *		152,013		299,584
Toll Holdings Ltd.		45,135		267,017
				752,808
Utilities 0.0%
AGL Energy Ltd.		11,709		192,805
				28,897,602

See financial notes 19

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Austria 0.4%
Banks 0.2%
Erste Group Bank AG *		26,310		824,652
Capital Goods 0.0%
Wienerberger AG		16,144		198,995
Energy 0.1%
OMV AG		14,621		686,816
Materials 0.1%
Voestalpine AG		11,738		368,057
Real Estate 0.0%
Immofinanz AG *		38,153		156,004
Telecommunication Services 0.0%
Telekom Austria AG		32,195		220,845
				2,455,369
Belgium 0.9%
Banks 0.1%
Dexia S.A. (c)*		1,039,686		68,461
KBC GROEP N.V.		15,418		603,475
				671,936
Food & Staples Retailing 0.2%
Colruyt S.A.		3,441		173,794
Delhaize Group S.A.		20,531		1,284,693
				1,458,487
Food, Beverage & Tobacco 0.2%
Anheuser-Busch InBev N.V.		13,042		1,252,952
Insurance 0.1%
Ageas		18,207		666,799
Materials 0.2%
Bekaert N.V.		6,019		193,935
Solvay S.A.		2,862		419,317
Umicore S.A.		6,546		303,382
				916,634
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
UCB S.A.		3,072		181,304
Telecommunication Services 0.1%
Belgacom S.A. (c)		12,283		282,791
Mobistar S.A.		4,715		112,453
				395,244
				5,543,356
Canada 5.7%
Automobiles & Components 0.2%
Magna International, Inc.		18,325		1,102,283
Banks 1.1%
Bank of Montreal (c)		15,413		966,745
Bank of Nova Scotia		23,026		1,327,689
Canadian Imperial Bank of Commerce		8,877		709,931
National Bank of Canada		3,430		259,263
Royal Bank of Canada		32,113		1,937,395
The Toronto-Dominion Bank		16,806		1,377,743
				6,578,766
Capital Goods 0.1%
Bombardier, Inc., Class B		76,668		304,404
Finning International, Inc.		7,380		159,255
SNC-Lavalin Group, Inc.		3,800		164,002
				627,661
Consumer Services 0.0%
Tim Hortons, Inc.		2,300		124,606
Diversified Financials 0.1%
IGM Financial, Inc.		3,220		143,477
Onex Corp.		4,643		231,585
				375,062
Energy 1.6%
ARC Resources Ltd.		7,500		209,638
Cameco Corp.		8,400		163,756
Canadian Natural Resources Ltd.		30,984		908,807
Canadian Oil Sands Ltd.		25,459		500,108
Cenovus Energy, Inc.		23,072		690,477
Crescent Point Energy Corp.		3,000		114,586
Enbridge, Inc.		12,511		595,342
Encana Corp.		104,898		1,933,551
Enerplus Corp.		15,906		224,511
Husky Energy, Inc.		14,867		429,726
Imperial Oil Ltd.		11,123		442,513
Pengrowth Energy Corp. (c)		36,581		186,636
Penn West Petroleum Ltd. (c)		34,668		320,028
Precision Drilling Corp.		18,000		145,972
Suncor Energy, Inc.		38,852		1,211,317
Talisman Energy, Inc.		62,715		751,995
TransCanada Corp.		17,935		889,050
				9,718,013
Food & Staples Retailing 0.4%
Alimentation Couche-Tard, Inc., Class B		6,764		410,963
Empire Co., Ltd, Class A		3,025		205,680
George Weston Ltd.		4,005		308,529
Loblaw Cos., Ltd.		7,582		321,734
Metro, Inc.		6,340		429,946
Shoppers Drug Mart Corp.		9,644		431,919
				2,108,771
Food, Beverage & Tobacco 0.0%
Saputo, Inc.		3,700		190,500
Insurance 0.5%
Fairfax Financial Holdings Ltd.		762		305,685
Great-West Lifeco, Inc.		8,320		225,952
Intact Financial Corp.		3,223		196,429
Manulife Financial Corp.		70,234		1,038,051
Power Corp. of Canada		20,415		549,763
Power Financial Corp.		9,814		289,905
Sun Life Financial, Inc.		20,890		589,303
				3,195,088
Materials 0.4%
Agrium, Inc.		3,312		303,602
Barrick Gold Corp.		21,107		416,085
First Quantum Minerals Ltd.		8,300		144,917
Goldcorp, Inc.		7,603		225,045
Kinross Gold Corp.		18,820		102,558
Methanex Corp.		4,800		203,444
Potash Corp. of Saskatchewan, Inc.		18,968		798,296

20 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Teck Resources Ltd., Class B		16,602		441,643
				2,635,590
Media 0.1%
Quebecor, Inc., Class B		3,492		162,564
Shaw Communications, Inc., Class B		6,573		149,669
				312,233
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Valeant Pharmaceuticals International, Inc. *		2,700		205,023
Real Estate 0.1%
Brookfield Asset Management, Inc., Class A		16,955		654,504
Retailing 0.1%
Canadian Tire Corp., Ltd., Class A		3,819		281,274
RONA, Inc.		17,000		177,180
				458,454
Software & Services 0.1%
CGI Group, Inc., Class A *		9,217		291,848
Technology Hardware & Equipment 0.2%
Celestica, Inc. *		21,312		184,043
Research In Motion Ltd. (c)*		66,737		1,093,018
				1,277,061
Telecommunication Services 0.4%
BCE, Inc.		16,525		774,048
Rogers Communications, Inc., Class B		17,104		843,613
Telus Corp.		15,418		554,770
				2,172,431
Transportation 0.2%
Canadian National Railway Co.		10,878		1,064,963
Canadian Pacific Railway Ltd.		3,107		387,230
				1,452,193
Utilities 0.1%
Fortis, Inc.		5,200		180,396
TransAlta Corp.		14,073		206,880
				387,276
				33,867,363
China 0.0%
Food, Beverage & Tobacco 0.0%
Chaoda Modern Agriculture (Holdings) Ltd. (a)(b)*		171,320		883
Denmark 0.6%
Banks 0.1%
Danske Bank A/S *		31,195		590,734
Capital Goods 0.1%
FLSmidth & Co. A/S		2,181		127,116
Vestas Wind Systems A/S *		31,830		276,921
				404,037
Food, Beverage & Tobacco 0.1%
Carlsberg A/S, Class B		4,108		381,914
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Novo Nordisk A/S, Class B		4,696		826,612
Telecommunication Services 0.1%
TDC A/S		38,447		311,998
Transportation 0.1%
AP Moller - Maersk A/S, Series A		59		403,830
AP Moller - Maersk A/S, Series B		119		847,399
DSV A/S		5,522		139,091
				1,390,320
				3,905,615
Finland 1.3%
Capital Goods 0.1%
Kone Oyj, B Shares		2,718		240,240
Metso Oyj		7,285		300,160
Wartsila Oyj Abp		6,062		298,090
				838,490
Energy 0.1%
Neste Oil Oyj		21,324		332,992
Food & Staples Retailing 0.1%
Kesko Oyj, B Shares		13,690		411,034
Insurance 0.1%
Sampo Oyj, A Shares		16,312		652,723
Materials 0.2%
Outokumpu Oyj (c)*		187,268		130,790
Rautaruukki Oyj		19,827		128,265
Stora Enso Oyj, R Shares		60,078		418,984
UPM-Kymmene Oyj (c)		58,247		613,207
				1,291,246
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Orion Oyj, Class B		5,650		162,368
Technology Hardware & Equipment 0.6%
Nokia Oyj (c)		1,024,610		3,442,367
Telecommunication Services 0.0%
Elisa Oyj		8,225		156,011
Utilities 0.1%
Fortum Oyj		23,198		431,193
				7,718,424
France 10.7%
Automobiles & Components 0.6%
Compagnie Generale des Etablissements Michelin		10,723		906,758
Peugeot S.A. (c)*		128,280		1,026,933
Renault S.A.		17,980		1,240,886
Valeo S.A.		5,452		317,165
				3,491,742
Banks 1.1%
BNP Paribas S.A.		63,838		3,559,473
Credit Agricole S.A. *		116,927		1,071,130
Societe Generale S.A. *		57,298		2,081,463
				6,712,066
Capital Goods 1.5%
Alstom S.A.		10,721		440,292
Bouygues S.A.		24,284		678,565
Compagnie de Saint-Gobain		54,071		2,165,486
Eiffage S.A.		8,069		357,846

See financial notes 21

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Legrand S.A.		7,961		371,528
Nexans S.A.		4,150		190,693
Rexel S.A.		8,042		177,124
Safran S.A.		7,160		351,955
Schneider Electric S.A.		20,527		1,564,909
Thales S.A.		4,793		208,264
Vallourec S.A.		11,871		569,752
Vinci S.A.		33,596		1,619,557
				8,695,971
Consumer Durables & Apparel 0.2%
Christian Dior S.A.		1,872		326,739
LVMH Moet Hennessy Louis Vuitton S.A.		5,362		929,152
				1,255,891
Consumer Services 0.1%
Accor S.A.		13,391		443,396
Sodexo		3,208		267,893
				711,289
Diversified Financials 0.0%
Wendel S.A.		1,391		150,763
Energy 1.8%
Compagnie Generale de Geophysique - Veritas *		7,421		160,536
Technip S.A.		2,835		304,083
Total S.A.		207,185		10,429,081
				10,893,700
Food & Staples Retailing 0.6%
Carrefour S.A. (c)		86,575		2,571,202
Casino Guichard Perrachon S.A.		4,535		490,524
Rallye S.A.		5,847		231,509
				3,293,235
Food, Beverage & Tobacco 0.3%
Danone S.A.		15,651		1,193,673
Pernod-Ricard S.A.		4,095		507,249
				1,700,922
Health Care Equipment & Services 0.1%
Essilor International S.A.		3,219		362,693
Household & Personal Products 0.1%
L’Oreal S.A.		4,896		873,891
Insurance 0.5%
AXA S.A.		140,819		2,637,065
CNP Assurances		12,766		180,937
SCOR SE		7,154		217,122
				3,035,124
Materials 0.4%
Air Liquide S.A.		8,648		1,095,669
Arkema S.A.		2,899		271,775
Lafarge S.A.		15,713		1,017,214
				2,384,658
Media 0.1%
Lagardere S.C.A.		12,519		465,306
Publicis Groupe S.A.		3,731		259,447
				724,753
Pharmaceuticals, Biotechnology & Life Sciences 0.8%
Sanofi		44,417		4,802,167
Real Estate 0.1%
Unibail-Rodamco SE		1,513		395,520
Retailing 0.1%
PPR		3,091		680,857
Software & Services 0.1%
Cap Gemini S.A.		10,513		484,714
Technology Hardware & Equipment 0.1%
Alcatel-Lucent *		258,086		355,450
Telecommunication Services 1.2%
France Telecom S.A.		388,066		4,144,304
Vivendi S.A.		125,694		2,847,206
				6,991,510
Transportation 0.1%
Air France-KLM *		82,180		832,423
Utilities 0.8%
EDF S.A.		30,379		680,121
GDF Suez		123,976		2,658,082
Suez Environnement Co.		27,749		398,231
Veolia Environnement S.A.		87,040		1,203,972
				4,940,406
				63,769,745
Germany 8.3%
Automobiles & Components 1.1%
Bayerische Motoren Werke AG		16,329		1,509,944
Continental AG		3,734		444,151
Daimler AG - Reg’d		74,452		4,127,995
Volkswagen AG		1,277		248,808
				6,330,898
Banks 0.1%
Commerzbank AG *		21,699		292,867
Capital Goods 0.8%
Brenntag AG		1,697		289,782
GEA Group AG		6,248		211,718
Hochtief AG *		2,616		182,011
Kloeckner & Co., SE *		16,086		194,716
MAN SE		1,520		170,536
MTU Aero Engines Holding AG		1,549		146,731
Rheinmetall AG		2,786		132,294
Siemens AG - Reg’d		35,000		3,657,046
				4,984,834
Commercial & Professional Supplies 0.0%
Bilfinger SE		2,082		208,969
Consumer Durables & Apparel 0.1%
Adidas AG		6,645		694,849
Consumer Services 0.0%
TUI AG *		25,127		266,831
Diversified Financials 0.4%
Deutsche Bank AG - Reg’d		46,673		2,148,500
Deutsche Boerse AG		6,483		405,162
				2,553,662
Food & Staples Retailing 0.1%
Metro AG		24,681		770,867
Health Care Equipment & Services 0.4%
Celesio AG		61,448		1,216,729

22 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Fresenius Medical Care AG & Co KGaA		5,186		357,294
Fresenius SE & Co KGaA		3,910		490,520
				2,064,543
Household & Personal Products 0.1%
Beiersdorf AG		2,220		201,093
Henkel AG & Co. KGaA		2,970		232,799
				433,892
Insurance 1.0%
Allianz SE - Reg’d		27,253		4,031,278
Hannover Rueckversicherung AG - Reg’d		2,300		194,594
Muenchener Rueckversicherungs-Gesellschaft AG - Reg’d		9,649		1,932,755
				6,158,627
Materials 1.4%
Aurubis AG		3,288		207,430
BASF SE		49,103		4,596,658
HeidelbergCement AG		9,429		680,665
K&S AG - Reg’d		6,759		299,224
Lanxess AG		3,138		229,172
Linde AG		4,716		892,944
Salzgitter AG		6,598		259,705
ThyssenKrupp AG *		51,460		932,903
				8,098,701
Pharmaceuticals, Biotechnology & Life Sciences 0.5%
Bayer AG - Reg’d		27,573		2,882,659
Merck KGaA		1,588		241,927
				3,124,586
Semiconductors & Semiconductor Equipment 0.0%
Infineon Technologies AG		33,644		266,129
Software & Services 0.2%
SAP AG		12,654		1,008,801
Telecommunication Services 0.7%
Deutsche Telekom AG - Reg’d		332,957		3,943,590
Transportation 0.4%
Deutsche Lufthansa AG - Reg’d		30,336		607,399
Deutsche Post AG - Reg’d		63,402		1,507,125
				2,114,524
Utilities 1.0%
E.ON SE AG		224,172		4,071,085
RWE AG		59,895		2,158,572
				6,229,657
				49,546,827
Greece 0.5%
Banks 0.1%
Alpha Bank A.E. *		212,638		271,458
National Bank of Greece S.A. *		345,087		296,742
Piraeus Bank S.A. *		543,556		152,579
				720,779
Consumer Services 0.1%
OPAP S.A.		61,058		601,882
Energy 0.1%
Motor Oil (Hellas) Corinth Refineries S.A.		56,535		626,695
Food, Beverage & Tobacco 0.0%
Coca Cola Hellenic Bottling Co., S.A. *		10,974		270,690
Telecommunication Services 0.1%
Hellenic Telecommunications Organization S.A. (OTE) *		70,981		619,619
Utilities 0.1%
Public Power Corp. S.A. *		44,985		437,189
				3,276,854
Hong Kong 0.8%
Banks 0.1%
Hang Seng Bank Ltd.		18,800		314,908
Capital Goods 0.2%
Hutchison Whampoa Ltd.		76,000		826,820
Jardine Matheson Holdings Ltd.		5,200		337,792
Noble Group Ltd.		291,879		267,738
				1,432,350
Insurance 0.1%
AIA Group Ltd.		96,200		427,942
Real Estate 0.1%
Cheung Kong (Holdings) Ltd.		15,000		226,376
Swire Pacific Ltd., Class A		21,000		267,229
Wharf Holdings Ltd.		22,000		196,506
				690,111
Retailing 0.1%
Esprit Holdings Ltd. (c)		258,084		362,954
Li & Fung Ltd.		178,000		231,019
				593,973
Telecommunication Services 0.0%
PCCW Ltd.		334,000		170,186
Transportation 0.0%
Orient Overseas International Ltd.		19,500		116,069
Utilities 0.2%
CLP Holdings Ltd.		57,500		507,173
Hong Kong & China Gas Co., Ltd.		61,104		184,053
Power Assets Holdings Ltd.		23,000		224,913
				916,139
				4,661,678
Ireland 0.7%
Banks 0.1%
Bank of Ireland *		2,443,678		544,430
Irish Bank Resolution Corp., Ltd. (a)(b)*		9,106		—
				544,430
Capital Goods 0.0%
DCC plc		6,096		223,102
Commercial & Professional Supplies 0.1%
Experian plc		16,530		290,841

See financial notes 23

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number			Value
Security	of Shares			($)
Food, Beverage & Tobacco 0.0%
Kerry Group plc, Class A		3,746			221,554
Materials 0.3%
CRH plc		57,968			1,248,261
Smurfit Kappa Group plc		20,146			299,529
					1,547,790
Media 0.1%
WPP plc		38,320			633,518
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Shire plc		5,176			161,346
Technology Hardware & Equipment 0.1%
Seagate Technology plc		19,637			720,678
					4,343,259
Israel 0.3%
Banks 0.1%
Bank Hapoalim B.M. *		35,058			163,081
Bank Leumi Le-Israel B.M. *		55,443			197,068
					360,149
Materials 0.0%
Israel Chemicals Ltd.		14,495			172,729
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Teva Pharmaceutical Industries Ltd.		23,438			899,868
Telecommunication Services 0.1%
Bezeq Israeli Telecommunication Corp., Ltd.		212,121			308,109
					1,740,855
Italy 3.9%
Automobiles & Components 0.2%
Fiat S.p.A. *		164,383			985,053
Banks 1.3%
Banca Monte dei Paschi di Siena S.p.A. (c)*		1,835,287	��		517,913
Banca Popolare dell’Emilia Romagna Scrl		33,092			280,647
Banca Popolare di Milano Scarl (c)*		307,712			206,062
Banco Popolare Scarl *		276,654			399,645
Intesa Sanpaolo S.p.A.		1,369,795			2,487,708
Intesa Sanpaolo S.p.A. - RSP		82,866			130,045
UniCredit S.p.A. *		630,986			3,297,935
Unione di Banche Italiane S.C.P.A.		88,217			368,943
					7,688,898
Capital Goods 0.1%
Fiat Industrial S.p.A.		22,906			258,661
Finmeccanica S.p.A. *		91,882			478,621
Prysmian S.p.A.		9,920			200,232
					937,514
Diversified Financials 0.1%
Exor S.p.A.		3,431			103,960
Mediobanca S.p.A.		38,603			245,694
					349,654
Energy 0.9%
Eni S.p.A.		210,952			5,034,667
Saipem S.p.A.		6,851			194,405
					5,229,072
Insurance 0.2%
Assicurazioni Generali S.p.A.		63,548			1,167,107
Materials 0.0%
Italcementi S.p.A.		19,015			118,057
Italcementi S.p.A. - RSP		27,797			85,705
					203,762
Media 0.1%
Mediaset S.p.A.		174,269			451,243
Telecommunication Services 0.4%
Telecom Italia S.p.A.		1,974,711			1,677,320
Telecom Italia S.p.A. - RSP		1,134,389			787,856
					2,465,176
Transportation 0.0%
Atlantia S.p.A.		15,989			285,860
Utilities 0.6%
A2A S.p.A.		201,145			158,344
Enel S.p.A.		793,261			3,067,840
Snam S.p.A.		40,630			199,945
Terna - Rete Elettrica Nationale S.p.A.		41,198			192,833
					3,618,962
					23,382,301
Japan 20.7%
Automobiles & Components 3.0%
Aisin Seiki Co., Ltd.		13,500			487,306
Bridgestone Corp.		34,800			1,313,470
Daihatsu Motor Co., Ltd.		10,000			198,367
Denso Corp.		24,300			1,089,628
Fuji Heavy Industries Ltd.		28,000			528,513
Honda Motor Co., Ltd.		81,600			3,256,041
Isuzu Motors Ltd.		45,000			299,895
Mazda Motor Corp. *		250,000			856,610
NHK Spring Co., Ltd.		14,200			153,709
Nissan Motors Co., Ltd.		139,200			1,452,176
Stanley Electric Co., Ltd.		9,000			172,616
Suzuki Motor Corp.		24,100			619,278
Toyota Industries Corp.		10,400			425,858
Toyota Motor Corp.		114,500			6,645,330
Yamaha Motor Co., Ltd.		21,200			295,749
					17,794,546
Banks 1.1%
Mitsubishi UFJ Financial Group, Inc.		374,134			2,538,439
Mizuho Financial Group, Inc.		609,616			1,341,434
Resona Holdings, Inc.		65,258			348,329
Sumitomo Mitsui Financial Group, Inc.		43,410			2,051,875
The Bank of Yokohama Ltd.		32,000			194,680
					6,474,757
Capital Goods 2.6%
Asahi Glass Co., Ltd.		80,000			628,577
Daikin Industries Ltd.		10,800			433,698
Fanuc Corp.		2,700			407,571
Fujikura Ltd.		46,000			172,379
Furukawa Electric Co., Ltd.		85,000			215,099

24 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Hanwa Co., Ltd.		42,000		158,359
IHI Corp.		69,000		257,297
Itochu Corp.		59,800		741,487
JGC Corp.		6,000		177,788
JTEKT Corp.		18,300		186,593
Kajima Corp.		58,000		185,200
Kawasaki Heavy Industries Ltd.		85,000		271,059
Komatsu Ltd.		31,400		860,296
Kubota Corp.		34,000		488,366
LIXIL Group Corp.		14,500		325,979
Makita Corp.		4,700		286,691
Marubeni Corp.		80,000		574,260
Mitsubishi Corp.		73,700		1,326,766
Mitsubishi Electric Corp.		100,000		953,339
Mitsubishi Heavy Industries Ltd.		151,000		1,041,304
Mitsui & Co., Ltd.		82,600		1,137,952
Nagase & Co., Ltd.		12,000		153,638
NGK Insulators Ltd.		11,000		132,958
Nidec Corp.		3,200		217,620
Nippon Sheet Glass Co., Ltd. *		183,000		210,953
NSK Ltd.		21,000		169,880
Obayashi Corp.		41,000		252,259
Shimizu Corp.		59,000		237,464
SMC Corp.		1,300		260,614
Sojitz Corp.		324,600		509,648
Sumitomo Corp.		57,100		714,837
Sumitomo Electric Industries Ltd.		58,700		780,631
Sumitomo Heavy Industries Ltd.		46,000		204,826
Taisei Corp.		74,000		247,162
Toyota Tsusho Corp.		23,100		643,371
				15,565,921
Commercial & Professional Supplies 0.3%
Dai Nippon Printing Co., Ltd.		67,000		656,040
Secom Co., Ltd.		7,700		429,461
Toppan Printing Co., Ltd.		61,000		464,788
				1,550,289
Consumer Durables & Apparel 1.1%
Casio Computer Co., Ltd.		17,100		141,679
Namco Bandai Holdings, Inc.		13,700		249,702
Nikon Corp.		10,000		217,661
Panasonic Corp. *		295,650		2,130,713
Sega Sammy Holdings, Inc.		8,400		220,698
Sekisui Chemical Co., Ltd.		25,000		314,814
Sekisui House Ltd.		42,000		629,552
Sharp Corp. (c)*		177,000		614,559
Shimano, Inc.		1,800		156,788
Sony Corp.		107,800		1,772,015
Yamaha Corp.		14,200		152,274
				6,600,455
Consumer Services 0.0%
Benesse Holdings, Inc.		2,600		115,232
Oriental Land Co., Ltd.		1,100		177,838
				293,070
Diversified Financials 0.3%
Credit Saison Co., Ltd.		8,000		234,013
Daiwa Securities Group, Inc.		34,000		301,670
Nomura Holdings, Inc.		57,200		467,478
ORIX Corp.		36,400		558,533
				1,561,694
Energy 0.6%
Cosmo Oil Co., Ltd. *		108,000		257,936
Idemitsu Kosan Co., Ltd.		4,300		363,780
Inpex Corp.		105		508,127
JX Holdings, Inc.		340,700		1,849,952
Showa Shell Sekiyu K.K.		29,100		233,559
TonenGeneral Sekiyu K.K.		26,000		262,741
				3,476,095
Food & Staples Retailing 0.5%
Aeon Co., Ltd.		60,900		862,183
Lawson, Inc.		1,800		141,721
Seven & I Holdings Co., Ltd.		50,200		1,931,001
Uny Group Holdings Co., Ltd.		20,400		145,188
				3,080,093
Food, Beverage & Tobacco 0.6%
Ajinomoto Co., Inc.		28,000		384,283
Asahi Group Holdings Ltd.		15,600		387,934
Japan Tobacco, Inc.		19,300		729,564
Kikkoman Corp.		10,000		189,809
Kirin Holdings Co., Ltd.		46,000		804,953
Meiji Holdings Co., Ltd.		6,000		270,864
Nippon Meat Packers, Inc.		16,000		245,710
Nisshin Seifun Group, Inc.		11,000		142,123
Toyo Suisan Kaisha Ltd.		5,000		169,927
Yamazaki Baking Co., Ltd.		10,000		130,865
				3,456,032
Health Care Equipment & Services 0.2%
Alfresa Holdings Corp.		4,500		267,722
Medipal Holdings Corp.		18,400		288,697
Olympus Corp. *		9,200		230,991
Suzuken Co., Ltd.		7,800		303,736
Terumo Corp.		4,500		223,562
				1,314,708
Household & Personal Products 0.2%
Kao Corp.		22,100		764,174
Shiseido Co., Ltd.		15,500		221,950
				986,124
Insurance 0.3%
MS&AD Insurance Group Holdings, Inc.		15,690		420,973
NKSJ Holdings, Inc.		14,300		362,951
T&D Holdings, Inc.		11,450		133,372
The Dai-ichi Life Insurance Co., Ltd.		229		315,669
Tokio Marine Holdings, Inc.		18,300		581,568
				1,814,533
Materials 1.8%
Nippon Steel & Sumitomo Metal Corp.		558,000		1,486,219
Asahi Kasei Corp.		84,000		564,677
DIC Corp.		75,000		167,890
Hitachi Chemical Co., Ltd.		7,200		112,872
JFE Holdings, Inc.		68,200		1,480,752
JSR Corp.		7,800		179,556
Kaneka Corp.		24,000		144,579
Kobe Steel Ltd. *		389,000		508,064
Kuraray Co., Ltd.		16,200		246,026
Mitsubishi Chemical Holdings Corp.		104,500		509,659
Mitsubishi Gas Chemical Co., Inc.		21,000		160,554
Mitsubishi Materials Corp.		71,000		203,657

See financial notes 25

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Mitsui Chemicals, Inc.		129,000		298,536
Mitsui Mining & Smelting Co., Ltd.		50,000		112,694
Nippon Paper Industries Co., Ltd. (c)*		16,443		246,295
Nitto Denko Corp.		6,600		433,617
Oji Holdings Corp.		83,000		296,260
Shin-Etsu Chemical Co., Ltd.		13,300		896,585
Showa Denko K.K.		118,000		190,540
Sumitomo Chemical Co., Ltd.		134,000		448,723
Sumitomo Metal Mining Co., Ltd.		29,000		405,980
Taiheiyo Cement Corp.		65,000		168,812
Teijin Ltd.		108,000		260,199
Toray Industries, Inc.		61,000		428,862
Tosoh Corp.		65,000		214,383
Toyo Seikan Kaisha Ltd.		21,200		290,531
Ube Industries Ltd.		77,000		155,687
				10,612,209
Media 0.1%
Dentsu, Inc.		13,001		451,959
Hakuhodo DY Holdings, Inc.		3,380		278,558
				730,517
Pharmaceuticals, Biotechnology & Life Sciences 0.7%
Astellas Pharma, Inc.		15,700		915,075
Daiichi Sankyo Co., Ltd.		29,900		585,045
Eisai Co., Ltd.		7,400		337,693
Ono Pharmaceutical Co., Ltd.		2,700		178,073
Otsuka Holdings Co., Ltd.		12,000		432,748
Shionogi & Co., Ltd.		10,000		245,969
Takeda Pharmaceutical Co., Ltd.		29,300		1,608,621
				4,303,224
Real Estate 0.4%
Daito Trust Construction Co., Ltd.		3,300		319,971
Daiwa House Industry Co., Ltd.		22,000		497,246
Mitsubishi Estate Co., Ltd.		18,000		586,280
Mitsui Fudosan Co., Ltd.		19,000		646,627
Sumitomo Realty & Development Co., Ltd.		7,500		354,460
				2,404,584
Retailing 0.4%
Edion Corp.		32,600		152,681
Fast Retailing Co., Ltd.		700		256,700
Isetan Mitsukoshi Holdings Ltd.		23,400		372,946
J. Front Retailing Co., Ltd.		39,000		327,649
Marui Group Co., Ltd.		18,300		212,421
Shimamura Co., Ltd.		1,500		189,573
Takashimaya Co., Ltd.		22,000		260,048
Yamada Denki Co., Ltd.		12,290		593,096
				2,365,114
Semiconductors & Semiconductor Equipment 0.1%
Rohm Co., Ltd.		8,500		300,488
Tokyo Electron Ltd.		8,000		409,474
				709,962
Software & Services 0.2%
Konami Corp.		5,700		130,026
Nintendo Co., Ltd.		9,930		1,096,000
NTT Data Corp.		82		259,619
				1,485,645
Technology Hardware & Equipment 2.3%
Brother Industries Ltd.		18,100		206,994
Canon, Inc.		61,700		2,219,009
FUJIFILM Holdings Corp.		50,200		1,031,285
Fujitsu Ltd.		249,000		1,045,819
Hitachi High-Technologies Corp.		5,400		134,899
Hitachi Ltd.		299,000		1,910,862
Hoya Corp.		20,000		400,727
Ibiden Co., Ltd.		11,900		208,594
Keyence Corp.		473		150,105
Konica Minolta Holdings, Inc.		48,400		341,939
Kyocera Corp.		7,300		742,575
Mitsumi Electric Co., Ltd. *		21,800		124,900
Murata Manufacturing Co., Ltd.		6,100		496,746
NEC Corp.		443,000		1,150,827
Nippon Electric Glass Co., Ltd.		45,000		229,689
Omron Corp.		10,600		334,853
Ricoh Co., Ltd.		66,000		734,388
Seiko Epson Corp.		27,100		310,684
TDK Corp.		8,900		325,443
Toshiba Corp.		251,000		1,384,058
				13,484,396
Telecommunication Services 1.1%
KDDI Corp.		36,000		1,731,144
Nippon Telegraph & Telephone Corp.		47,604		2,367,354
NTT DoCoMo, Inc.		818		1,354,524
Softbank Corp.		25,500		1,264,645
				6,717,667
Transportation 1.1%
Central Japan Railway Co.		8,600		1,037,189
East Japan Railway Co.		15,818		1,335,303
Hankyu Hanshin Holdings, Inc.		41,000		265,485
Kawasaki Kisen Kaisha Ltd.		146,000		321,249
Kintetsu Corp. (c)		37,000		187,154
Mitsui O.S.K. Lines, Ltd. *		184,000		766,237
Nagoya Railroad Co., Ltd.		44,000		136,523
Nippon Express Co., Ltd.		96,000		499,673
Nippon Yusen K.K.		240,000		626,533
Seino Holdings Co., Ltd.		21,000		183,712
Tobu Railway Co., Ltd.		26,000		151,144
Tokyu Corp.		45,000		356,855
West Japan Railway Co.		9,763		472,356
Yamato Holdings Co., Ltd.		24,000		462,959
				6,802,372
Utilities 1.7%
Chubu Electric Power Co., Inc.		68,600		888,099
Electric Power Development Co., Ltd.		8,400		239,904
Hokkaido Electric Power Co., Inc. *		22,700		288,034
Hokuriku Electric Power Co.		16,900		249,247
Kyushu Electric Power Co., Inc. *		63,300		874,387
Osaka Gas Co., Ltd.		104,000		450,738
Shikoku Electric Power Co., Inc. *		17,100		309,969
The Chugoku Electric Power Co., Inc.		26,600		381,800
The Kansai Electric Power Co., Inc. *		101,400		1,238,838
Tohoku Electric Power Co., Inc. *		73,600		788,291
Tokyo Electric Power Co., Inc. *		848,400		3,755,522

26 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Tokyo Gas Co., Ltd.		114,000		650,729
				10,115,558
				123,699,565
Luxembourg 0.5%
Energy 0.1%
Tenaris S.A.		17,247		384,512
Materials 0.3%
APERAM		10,253		126,581
ArcelorMittal		147,271		1,820,362
				1,946,943
Media 0.1%
SES S.A.		8,609		268,505
Telecommunication Services 0.0%
Millicom International Cellular S.A. SDR		2,000		164,268
				2,764,228
Netherlands 5.4%
Capital Goods 0.4%
European Aeronautic Defence & Space Co., N.V.		9,736		514,369
Koninklijke BAM Groep N.V. (c)		38,582		171,011
Koninklijke Philips Electronics N.V.		55,628		1,539,674
				2,225,054
Commercial & Professional Supplies 0.1%
Randstad Holding N.V.		7,498		312,549
Diversified Financials 0.3%
ING Groep N.V. CVA *		247,998		2,042,968
SNS Reaal N.V. (a)(b)(c)*		124,822		—
				2,042,968
Energy 2.9%
Fugro N.V. CVA		2,966		171,364
Royal Dutch Shell plc, A Shares		288,326		9,806,539
Royal Dutch Shell plc, B Shares		207,329		7,272,568
SBM Offshore N.V. *		10,863		174,314
				17,424,785
Food & Staples Retailing 0.3%
Koninklijke Ahold N.V.		108,873		1,719,890
Food, Beverage & Tobacco 0.5%
CSM		7,991		178,875
Heineken Holding N.V.		4,259		256,635
Heineken N.V.		4,795		339,365
Nutreco N.V. *		1,798		170,965
Unilever N.V. CVA		47,338		2,017,136
				2,962,976
Insurance 0.2%
Aegon N.V.		147,702		986,612
Delta Lloyd N.V.		10,143		195,033
				1,181,645
Materials 0.3%
Akzo Nobel N.V.		17,692		1,067,011
Koninklijke DSM N.V.		9,575		617,164
				1,684,175
Media 0.1%
Reed Elsevier N.V.		12,033		195,305
Wolters Kluwer N.V.		14,881		329,295
				524,600
Semiconductors & Semiconductor Equipment 0.1%
ASML Holding N.V.		4,144		308,367
Telecommunication Services 0.1%
Koninklijke (Royal) KPN N.V. (c)		238,811		500,412
VimpelCom Ltd. ADR		40,210		440,300
				940,712
Transportation 0.1%
PostNL N.V. *		235,305		536,697
TNT Express N.V.		21,857		167,935
				704,632
				32,032,353
New Zealand 0.1%
Materials 0.0%
Fletcher Building Ltd.		36,454		276,557
Telecommunication Services 0.1%
Telecom Corp. of New Zealand Ltd.		197,515		441,053
				717,610
Norway 0.9%
Banks 0.1%
DnB A.S.A.		33,595		550,135
Energy 0.4%
Aker Solutions A.S.A. (c)		6,895		96,502
Seadrill Ltd.		6,314		243,301
Statoil A.S.A.		85,969		2,104,638
				2,444,441
Food, Beverage & Tobacco 0.1%
Marine Harvest *		178,741		185,983
Orkla A.S.A.		49,382		445,293
				631,276
Materials 0.2%
Norsk Hydro A.S.A.		102,610		483,253
Yara International A.S.A.		6,885		323,416
				806,669
Telecommunication Services 0.1%
Telenor A.S.A.		30,176		680,014
				5,112,535
Portugal 0.3%
Banks 0.1%
Banco Comercial Portugues S.A. - Reg’d *		1,715,207		237,806
Banco Espirito Santo, S.A. - Reg’d *		143,643		164,586
				402,392
Energy 0.0%
Galp Energia, SGPS, S.A.		8,155		130,698

See financial notes 27

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Telecommunication Services 0.1%
Portugal Telecom, SGPS, S.A. - Reg’d		104,052		542,924
Utilities 0.1%
EDP - Energias de Portugal S.A.		173,536		596,443
				1,672,457
Singapore 0.7%
Banks 0.2%
DBS Group Holdings Ltd.		34,056		464,567
Oversea-Chinese Banking Corp., Ltd.		44,897		396,350
United Overseas Bank Ltd.		26,952		468,353
				1,329,270
Capital Goods 0.1%
Fraser & Neave Ltd. (b)(c)		22,000		151,433
Keppel Corp., Ltd.		32,300		281,744
SembCorp Industries Ltd.		30,000		121,910
				555,087
Food, Beverage & Tobacco 0.1%
Wilmar International Ltd.		77,166		209,468
Media 0.0%
Singapore Press Holdings Ltd.		47,000		170,330
Real Estate 0.0%
Keppel REIT		6,460		7,928
Technology Hardware & Equipment 0.1%
Flextronics International Ltd. *		64,200		459,030
Venture Corp., Ltd.		20,000		135,091
				594,121
Telecommunication Services 0.1%
Singapore Telecommunications Ltd.		223,486		713,882
Transportation 0.1%
ComfortDelGro Corp., Ltd.		98,000		158,120
Singapore Airlines Ltd.		35,270		318,492
				476,612
				4,056,698
Spain 3.9%
Banks 1.7%
Banco Bilbao Vizcaya Argentaria S.A. (a)		6,318		61,322
Banco Bilbao Vizcaya Argentaria S.A.		353,810		3,444,187
Banco de Sabadell S.A.		144,535		300,243
Banco Popular Espanol S.A.		379,615		295,568
Banco Santander S.A.		817,742		5,905,362
Bankia S.A. (c)*		2,925		15,408
CaixaBank		40,979		151,522
				10,173,612
Capital Goods 0.1%
ACS, Actividades de Construccion y Servicios S.A.		15,766		404,921
Ferrovial S.A.		17,088		282,677
Fomento de Construcciones y Contratas S.A. (c)		13,625		141,350
				828,948
Energy 0.4%
Repsol S.A.		98,972		2,320,354
Food & Staples Retailing 0.0%
Distribuidora Internacional de Alimentacion S.A.		32,903		255,045
Retailing 0.1%
Inditex S.A.		3,402		456,567
Telecommunication Services 1.0%
Telefonica S.A.		421,907		6,177,692
Transportation 0.1%
Abertis Infraestructuras S.A.		17,702		330,307
Utilities 0.5%
Acciona S.A.		2,716		177,684
Enagas S.A.		6,858		182,636
Endesa S.A.		10,660		241,975
Gas Natural SDG S.A.		19,108		400,115
Iberdrola S.A.		323,571		1,739,701
Red Electrica Corp. S.A.		3,132		166,494
				2,908,605
				23,451,130
Sweden 2.3%
Automobiles & Components 0.1%
Autoliv, Inc.		4,213		321,957
Banks 0.5%
Nordea Bank AB		84,891		1,021,495
Skandinaviska Enskilda Banken AB, A Shares		57,451		591,019
Svenska Handelsbanken AB, A Shares		17,711		807,411
Swedbank AB, A Shares		19,478		479,620
				2,899,545
Capital Goods 0.8%
Alfa Laval AB		8,818		194,376
Assa Abloy AB, B Shares		7,785		311,546
Atlas Copco AB, A Shares		24,787		655,428
Atlas Copco AB, B Shares		11,710		279,394
NCC AB, B Shares		8,159		194,136
Sandvik AB		41,949		598,344
Scania AB, B Shares		11,811		252,593
Skanska AB, B Shares		27,616		471,122
SKF AB, B Shares		16,985		396,505
Trelleborg AB, B Shares		10,383		154,594
Volvo AB, A Shares		18,237		251,774
Volvo AB, B Shares		53,958		747,847
				4,507,659
Commercial & Professional Supplies 0.0%
Securitas AB, B Shares		26,224		258,055
Consumer Durables & Apparel 0.1%
Electrolux AB, B Shares		16,052		456,861
Husqvarna AB, B Shares		29,948		173,284
				630,145

28 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Food, Beverage & Tobacco 0.0%
Swedish Match AB		6,232		216,191
Household & Personal Products 0.1%
Svenska Cellulosa AB, B Shares		34,037		886,624
Materials 0.1%
Boliden AB		17,460		278,835
SSAB AB, A Shares		27,546		202,957
SSAB AB, B Shares		8,242		52,935
				534,727
Retailing 0.1%
Hennes & Mauritz AB, B Shares		24,188		859,004
Technology Hardware & Equipment 0.3%
Telefonaktiebolaget LM Ericsson, A Shares		4,773		57,811
Telefonaktiebolaget LM Ericsson, B Shares		134,245		1,669,521
				1,727,332
Telecommunication Services 0.2%
Tele2 AB, B Shares		27,259		467,741
TeliaSonera AB		101,137		697,820
				1,165,561
				14,006,800
Switzerland 5.5%
Capital Goods 0.5%
ABB Ltd. - Reg’d *		59,414		1,347,326
Foster Wheeler AG *		6,400		135,040
Geberit AG - Reg’d		848		207,236
Schindler Holding AG		859		128,905
Schindler Holding AG - Reg’d		386		56,534
Wolseley plc		16,725		828,374
				2,703,415
Commercial & Professional Supplies 0.1%
Adecco S.A. - Reg’d *		9,788		523,548
SGS S.A. - Reg’d		99		239,395
				762,943
Consumer Durables & Apparel 0.2%
Compagnie Financiere Richemont S.A., Series A		7,526		609,069
The Swatch Group AG - Bearer Shares		514		294,892
The Swatch Group AG - Reg’d		832		83,667
				987,628
Diversified Financials 0.4%
Credit Suisse Group AG - Reg’d *		59,902		1,663,540
GAM Holding AG *		13,247		234,272
UBS AG - Reg’d		30,863		550,547
				2,448,359
Energy 0.3%
Noble Corp.		10,858		407,175
Transocean Ltd. *		20,122		1,032,344
Weatherford International Ltd. *		39,604		506,535
				1,946,054
Food, Beverage & Tobacco 1.1%
Nestle S.A. - Reg’d		89,906		6,411,417
Insurance 0.6%
Baloise Holding AG - Reg’d		2,317		238,825
Swiss Life Holding AG - Reg’d *		1,808		286,431
Swiss Re AG *		11,369		904,763
Zurich Insurance Group AG *		7,081		1,978,726
				3,408,745
Materials 0.6%
Clariant AG - Reg’d *		13,004		190,255
Givaudan S.A. - Reg’d *		166		213,780
Glencore International plc (c)		113,842		562,783
Holcim Ltd. - Reg’d *		11,511		897,915
Sika AG		72		173,984
Syngenta AG - Reg’d		1,585		677,618
Xstrata plc		75,916		1,142,419
				3,858,754
Media 0.0%
Informa plc		21,190		157,673
Pharmaceuticals, Biotechnology & Life Sciences 1.4%
Lonza Group AG - Reg’d *		2,820		196,504
Novartis AG - Reg’d		60,911		4,509,094
Roche Holding AG		13,929		3,486,991
Roche Holding AG - Bearer Shares		577		144,160
				8,336,749
Semiconductors & Semiconductor Equipment 0.1%
STMicroelectronics N.V.		82,200		713,600
Technology Hardware & Equipment 0.1%
TE Connectivity Ltd.		17,033		741,787
Telecommunication Services 0.1%
Swisscom AG - Reg’d		914		430,512
Transportation 0.0%
Kuehne & Nagel International AG - Reg’d		1,848		211,676
				33,119,312
United Kingdom 17.3%
Automobiles & Components 0.0%
GKN plc		64,860		277,632
Banks 2.7%
Barclays plc		872,569		3,893,818
HSBC Holdings plc		823,137		9,014,986
Lloyds Banking Group plc *		2,133,225		1,812,159
Royal Bank of Scotland Group plc *		144,771		690,822
Standard Chartered plc		43,644		1,098,406
				16,510,191
Capital Goods 0.6%
BAE Systems plc		186,406		1,088,740
Balfour Beatty plc		43,515		146,121
Bunzl plc		12,735		253,330
Carillion plc		28,212		117,694
Cobham plc		36,458		142,037
IMI plc		10,546		203,286
Meggitt plc		18,091		131,850
Rolls-Royce Holdings plc *		43,915		771,994
Rolls-Royce Holdings plc, C Shares (a)*		5,225,885		8,118
SIG plc		79,290		199,847
Smiths Group plc		14,714		286,178

See financial notes 29

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Travis Perkins plc		11,961		266,883
Vesuvius plc		13,032		70,604
				3,686,682
Commercial & Professional Supplies 0.2%
Aggreko plc		3,195		88,567
Capita plc		16,555		232,150
G4S plc		69,361		337,620
Hays plc		131,573		191,319
Rentokil Initial plc		98,811		145,724
Serco Group plc		15,895		152,967
				1,148,347
Consumer Durables & Apparel 0.2%
Barratt Developments plc *		79,419		384,453
Burberry Group plc		7,401		153,965
Persimmon plc		19,517		327,860
Persimmon plc - Reg’d, B Shares (a)		19,517		22,738
Taylor Wimpey plc		210,495		304,571
				1,193,587
Consumer Services 0.6%
Carnival plc		10,461		377,683
Compass Group plc		67,949		894,892
Enterprise Inns plc *		147,036		224,179
InterContinental Hotels Group plc		6,398		189,036
Thomas Cook Group plc *		664,821		1,337,038
TUI Travel plc		62,983		307,941
Whitbread plc		7,398		294,094
William Hill plc		29,478		195,333
				3,820,196
Diversified Financials 0.1%
ICAP plc		23,061		103,365
Man Group plc		317,538		504,915
				608,280
Energy 2.8%
AMEC plc		10,702		168,706
BG Group plc		103,230		1,742,660
BP plc		1,994,840		14,454,891
Ensco plc, Class A		3,800		219,184
John Wood Group plc		14,017		169,181
				16,754,622
Food & Staples Retailing 0.9%
J. Sainsbury plc		153,946		912,352
Tesco plc		560,758		3,189,581
WM Morrison Supermarkets plc		234,831		1,065,715
				5,167,648
Food, Beverage & Tobacco 1.4%
Associated British Foods plc		13,658		410,857
British American Tobacco plc		47,387		2,626,908
Diageo plc		50,359		1,537,841
Imperial Tobacco Group plc		26,732		955,825
SABMiller plc		16,628		897,201
Tate & Lyle plc		20,310		266,538
Unilever plc		33,770		1,463,143
				8,158,313
Health Care Equipment & Services 0.1%
Smith & Nephew plc		27,504		314,827
Household & Personal Products 0.2%
Reckitt Benckiser Group plc		14,215		1,037,708
Insurance 0.8%
Amlin plc		26,398		174,123
Aviva plc		235,510		1,118,086
Legal & General Group plc		183,780		484,655
Old Mutual plc		214,933		685,548
Prudential plc		46,050		791,810
Resolution Ltd.		99,420		408,279
RSA Insurance Group plc		208,473		360,989
Standard Life plc		64,435		375,446
Willis Group Holdings plc		4,700		186,496
				4,585,432
Materials 1.3%
Anglo American plc		104,321		2,550,727
Antofagasta plc		8,668		121,630
BHP Billiton plc		54,287		1,527,244
Johnson Matthey plc		11,078		417,891
Kazakhmys plc		15,064		81,880
Mondi plc		23,506		312,383
Rexam plc		41,269		331,367
Rio Tinto plc		43,298		1,988,247
Vedanta Resources plc		11,499		217,587
				7,548,956
Media 0.2%
British Sky Broadcasting Group plc		25,368		332,465
ITV plc		108,948		213,039
Pearson plc		28,388		516,310
Reed Elsevier plc		21,103		246,722
UBM plc		15,080		171,508
				1,480,044
Pharmaceuticals, Biotechnology & Life Sciences 1.7%
AstraZeneca plc		80,695		4,189,763
GlaxoSmithKline plc		227,726		5,875,666
				10,065,429
Real Estate 0.1%
British Land Co., plc		21,480		198,701
Land Securities Group plc		26,617		361,584
				560,285
Retailing 0.6%
Dixons Retail plc *		702,982		384,590
Home Retail Group plc		306,468		742,204
Inchcape plc		43,884		342,107
Kingfisher plc		158,041		770,075
Marks & Spencer Group plc		135,198		860,566
Next plc		7,027		476,335
				3,575,877
Software & Services 0.0%
The Sage Group plc		35,937		188,548
Telecommunication Services 1.8%
BT Group plc		515,966		2,218,462
Cable & Wireless Communications plc		460,584		303,221
Vodafone Group plc		2,644,854		8,070,229
				10,591,912
Transportation 0.1%
FirstGroup plc		83,564		274,418
National Express Group plc		44,758		133,074
				407,492

30 See financial notes

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Utilities 0.9%
Centrica plc		250,350		1,443,956
Drax Group plc		32,406		309,280
National Grid plc		141,347		1,801,779
Pennon Group plc		11,943		127,209
Severn Trent plc		10,144		287,492
SSE plc		47,284		1,144,833
United Utilities Group plc		38,677		445,566
				5,560,115
				103,242,123
Total Common Stock
(Cost $505,169,197)				576,984,942
Preferred Stock 0.4% of net assets
Germany 0.4%
Automobiles & Components 0.3%
Bayerische Motoren Werke AG		2,734		190,358
Volkswagen AG		6,926		1,406,522
				1,596,880
Capital Goods 0.0%
MAN SE		427		47,704
Household & Personal Products 0.1%
Henkel AG & Co. KGaA		4,426		417,845
Utilities 0.0%
RWE AG		4,508		153,493
				2,215,922
Italy 0.0%
Diversified Financials 0.0%
EXOR S.p.A.		1,901		57,103
Total Preferred Stock
(Cost $1,413,091)				2,273,025
Rights 0.0% of net assets
Spain 0.0%
Bankia S.A. *		2,925		4,776
Total Rights
(Cost $91,567)				4,776
Other Investment Company 0.2% of net assets
United States 0.2%
iShares MSCI EAFE Index Fund		20,000		1,238,800
Total Other Investment Company
(Cost $935,189)				1,238,800
	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 2.3% of net assets
Time Deposits 2.2%
Bank of America
Canadian Dollar
0.24%, 05/01/13		29,369		29,152
Brown Brothers Harriman
Hong Kong Dollar
0.01%, 05/01/13		5,449		702
Japanese Yen
0.01%, 05/01/13		761,620		7,813
Norwegian Krone
0.40%, 05/01/13		92,592		16,057
Pound Sterling
0.01%, 05/01/13		336		521
Swiss Franc
0.01%, 05/01/13		17,923		19,276
Citibank
Euro
(0.01)%, 05/01/13		246,047		324,032
DNB
US Dollar
0.03%, 05/01/13		12,896,101		12,896,101
				13,293,654
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.00%, 06/20/13 (d)(e)		100,000		100,000
0.01%, 06/20/13 (d)(e)		100,000		99,999
0.03%, 06/20/13 (d)(e)		100,000		99,996
0.09%, 06/20/13 (d)(e)		319,000		318,962
				618,957
Total Short-Term Investments
(Cost $13,912,611)				13,912,611
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 2.4% of net assets
Wells Fargo Advantage Government Money Market Fund		14,315,517		14,315,517
Total Collateral Invested for Securities on Loan
(Cost $14,315,517)				14,315,517
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $543,623,583 unrealized appreciation and depreciation were $85,174,193 and ($34,383,622), respectively, with a net unrealized appreciation of $50,790,571.

See financial notes 31

 Schwab Fundamental International Large Company Index Fund

Portfolio Holdings (Unaudited) continued

At 04/30/13, the values of certain foreign securities held by the fund aggregating $539,526,468 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

*	Non-income producing security.
(a)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(b)	Illiquid security. At the period end, the value of these amounted to $152,316 or 0.0% of net assets.
(c)	All or a portion of this security is on loan.
(d)	The rate shown is the purchase yield.
(e)	All or a portion of this security is held as collateral for open futures contracts.

ADR —	American Depositary Receipt
CVA —	Dutch Certificate
Reg’d —	Registered
REIT —	Real Estate Investment Trust
RSP —	Risparmio (Convertible Savings Shares)
SDR —	Swedish Depositary Receipt

In addition to the above the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI EAFE, e-mini, Long, expires 06/21/13		150		13,056,000		478,064

32 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	96	.7%	Common Stock		94,108,625		111,781,464
	0	.5%	Preferred Stock		333,941		493,865
	0	.9%	Other Investment Companies		937,056		1,094,789
	3	.2%	Short-Term Investments		3,719,226		3,719,226
	101	.3%	Total Investments		99,098,848		117,089,344
	2	.8%	Collateral Invested for Securities on Loan		3,235,192		3,235,192
	(4	.1)%	Other Assets and Liabilities, Net				(4,717,877	)
	100	.0%	Total Net Assets				115,606,659

	Number		Value
Security	of Shares		($)
Common Stock 96.7% of net assets
Australia 4.8%
Banks 0.2%
Bank of Queensland Ltd.		8,450		87,969
Bendigo & Adelaide Bank Ltd.		11,288		129,552
				217,521
Capital Goods 0.3%
Boart Longyear Ltd.		61,286		60,907
Bradken Ltd.		9,184		49,019
Emeco Holdings Ltd.		69,909		33,397
GWA Group Ltd.		24,561		66,016
Macmahon Holdings Ltd.		125,138		23,316
Monadelphous Group Ltd.		2,308		50,152
UGL Ltd.		13,243		138,221
				421,028
Commercial & Professional Supplies 0.2%
ALS Ltd.		7,712		78,392
Seek Ltd.		4,230		49,076
Skilled Group Ltd.		13,395		39,614
Transfield Services Ltd.		43,419		71,969
Transpacific Industries Group Ltd. *		67,874		68,178
				307,229
Consumer Durables & Apparel 0.1%
Billabong International Ltd. *		78,380		38,597
G.U.D. Holdings Ltd.		4,437		33,552
				72,149
Consumer Services 0.2%
Aristocrat Leisure Ltd.		24,735		101,093
Echo Entertainment Group Ltd.		14,493		54,392
Flight Centre Ltd.		1,463		57,923
				213,408
Diversified Financials 0.3%
ASX Ltd.		3,300		128,666
Challenger Ltd.		18,075		78,808
Perpetual Ltd.		2,356		100,681
				308,155
Energy 0.1%
AWE Ltd. *		34,106		45,676
Beach Energy Ltd.		39,077		55,199
				100,875
Food, Beverage & Tobacco 0.3%
Goodman Fielder Ltd. *		237,979		191,367
GrainCorp Ltd., Class A		5,707		75,823
Treasury Wine Estates Ltd.		9,774		59,240
				326,430
Health Care Equipment & Services 0.4%
Ansell Ltd.		6,100		100,018
Cochlear Ltd.		1,034		70,805
Primary Health Care Ltd.		20,998		114,761
Ramsay Health Care Ltd.		2,674		88,793
Sigma Pharmaceuticals Ltd.		204,045		154,481
				528,858
Insurance 0.1%
NIB Holdings Ltd.		23,799		58,064
Materials 0.3%
Adelaide Brighton Ltd.		24,100		85,040
Aquarius Platinum Ltd. *		87,336		52,711
Gunns Ltd. (b)(c)*		124,356		—
Iluka Resources Ltd.		6,901		64,113
Kagara Ltd. (b)(c)*		83,968		—
Nufarm Ltd.		14,337		62,523
OZ Minerals Ltd.		17,413		78,048
				342,435
Media 0.2%
APN News & Media Ltd.		191,295		83,459
Seven West Media Ltd.		22,142		45,950
Southern Cross Media Group Ltd.		26,369		42,533
Ten Network Holdings Ltd. *		111,437		35,829
				207,771
Real Estate 0.6%
Australand Property Group		12,210		47,459
CFS Retail Property Trust Group		47,485		108,205
Commonwealth Property Office Fund		53,802		64,653
Dexus Property Group		140,740		168,360
Goodman Group		16,326		88,311
GPT Group		41,422		176,232
Investa Office Fund		14,245		48,445
				701,665
Retailing 0.7%
David Jones Ltd.		54,034		167,021
Harvey Norman Holdings Ltd.		37,152		115,661
JB Hi-Fi Ltd. (a)		6,298		104,563
Myer Holdings Ltd		47,472		158,109
Pacific Brands Ltd.		165,741		147,910

See financial notes 33

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Premier Investments Ltd.		8,970		80,438
				773,702
Software & Services 0.1%
Computershare Ltd.		16,227		167,163
Transportation 0.4%
Aurizon Holdings Ltd.		21,343		91,873
Sydney Airport		48,170		172,830
Transurban Group		18,292		129,403
Virgin Australia Holdings Ltd. *		98,519		46,482
Virgin Australia International Holdings (b)(c)		176,214		—
				440,588
Utilities 0.3%
APA Group		16,366		110,523
DUET Group		55,891		142,434
SP AusNet		76,200		99,164
				352,121
				5,539,162
Austria 0.7%
Banks 0.1%
Raiffeisen Bank International AG		3,866		136,470
Capital Goods 0.3%
Andritz AG		2,558		166,585
Semperit AG Holding		773		30,235
Strabag SE - BR		2,862		65,903
Zumtobel AG		4,185		46,864
				309,587
Insurance 0.1%
Vienna Insurance Group AG Wiener Versicherung Gruppe		2,047		108,398
Materials 0.1%
Lenzing AG		406		33,609
RHI AG		1,313		43,377
				76,986
Transportation 0.1%
Flughafen Wien AG		1,033		63,995
Oesterreichische Post AG		2,897		128,381
				192,376
Utilities 0.0%
Verbund AG		1,916		41,946
				865,763
Belgium 1.1%
Capital Goods 0.0%
Compagnie d’Enterprises CFE		784		47,701
Diversified Financials 0.2%
Ackermans & van Haaren N.V.		536		45,604
Gimv N.V.		1,144		58,878
Groupe Bruxelles Lambert S.A.		900		69,659
Sofina S.A.		498		47,384
				221,525
Energy 0.0%
Euronav S.A. *		6,666		26,721
Health Care Equipment & Services 0.1%
Agfa Gevaert N.V. *		88,301		159,315
Materials 0.2%
Nyrstar *		19,485		95,115
Tessenderlo Chemie N.V.		3,960		111,959
				207,074
Media 0.1%
Telenet Group Holding N.V.		1,751		94,168
Real Estate 0.1%
Befimmo S.C.A.		491		34,078
Cofinimmo		455		54,798
				88,876
Retailing 0.2%
S.A. D’Ieteren N.V.		3,558		164,000
Technology Hardware & Equipment 0.1%
Barco N.V.		940		83,702
EVS Broadcast Equipment S.A.		676		45,801
				129,503
Utilities 0.1%
Elia System Operator S.A./N.V.		2,003		88,315
				1,227,198
Canada 7.6%
Automobiles & Components 0.1%
Linamar Corp.		3,833		90,741
Martinrea International, Inc. *		6,498		55,018
				145,759
Banks 0.2%
Canadian Western Bank		1,400		39,549
Genworth MI Canada, Inc.		3,364		83,645
Home Capital Group, Inc.		700		40,161
Laurentian Bank of Canada		1,095		48,052
				211,407
Capital Goods 0.5%
Aecon Group, Inc.		3,790		46,648
ATS Automation Tooling Systems, Inc. *		3,700		37,351
Bird Construction, Inc.		2,220		28,801
CAE, Inc.		9,633		104,128
Russel Metals, Inc.		5,453		147,495
Toromont Industries Ltd.		5,107		112,537
Wajax Corp.		1,534		52,501
				529,461
Commercial & Professional Supplies 0.4%
Newalta Corp.		3,200		44,056
Progressive Waste Solutions Ltd.		5,455		121,559
Ritchie Bros. Auctioneers, Inc.		2,599		52,628
Stantec, Inc.		1,500		64,142
Transcontinental, Inc., Class A (a)		10,751		138,409
				420,794
Consumer Durables & Apparel 0.2%
Dorel Industries, Inc., Class B		3,010		129,967
Gildan Activewear, Inc.		2,902		116,691
				246,658

34 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Consumer Services 0.0%
EnerCare, Inc.		4,417		41,213
Diversified Financials 0.4%
AGF Management Ltd., Class B		8,221		93,842
Canaccord Financial, Inc.		4,969		28,361
CI Financial Corp.		6,383		178,733
Davis & Henderson Corp.		3,400		79,444
Dundee Corp., Class A *		1,687		63,079
GMP Capital, Inc.		8,284		44,074
				487,533
Energy 2.0%
Advantage Oil & Gas Ltd. *		30,129		119,326
AltaGas Ltd.		3,522		131,238
Baytex Energy Corp.		3,570		141,071
Bellatrix Exploration Ltd. *		8,911		55,813
Bonavista Energy Corp.		10,578		167,471
Ensign Energy Services, Inc.		8,327		140,182
Freehold Royalties Ltd.		1,728		42,057
Gibson Energy, Inc.		4,109		107,064
Keyera Corp.		2,400		149,915
Mullen Group Ltd.		4,900		106,322
Nuvista Energy Ltd. *		6,297		45,753
Pacific Rubiales Energy Corp.		2,917		61,673
Parkland Fuel Corp.		4,100		67,760
Pembina Pipeline Corp.		5,049		165,736
PetroBakken Energy Ltd.		7,346		62,708
Petrobank Energy & Resources Ltd. *		23,300		15,727
Peyto Exploration & Development Corp.		3,300		94,992
Savanna Energy Services Corp.		4,173		29,202
ShawCor Ltd.		2,222		89,259
Trican Well Service Ltd.		5,996		78,324
Trilogy Energy Corp.		1,200		35,079
Trinidad Drilling Ltd.		11,884		81,157
Veresen, Inc.		8,982		120,182
Vermilion Energy, Inc.		2,758		141,534
Zargon Oil & Gas Ltd.		3,865		25,090
				2,274,635
Food & Staples Retailing 0.2%
Liquor Stores N.A. Ltd.		1,728		30,582
The Jean Coutu Group (PJC), Inc., Class A		7,400		123,034
The North West Co., Inc.		3,550		89,574
				243,190
Food, Beverage & Tobacco 0.2%
Cott Corp.		8,200		90,103
Maple Leaf Foods, Inc.		8,314		109,923
				200,026
Health Care Equipment & Services 0.1%
CML Healthcare, Inc.		8,446		64,805
Insurance 0.1%
Industrial Alliance Insurance & Financial Services, Inc.		3,455		127,644
Materials 1.0%
Agnico-Eagle Mines Ltd.		2,023		65,302
Canfor Corp. *		4,398		91,850
CCL Industries, Inc., Class B		1,419		88,680
Centerra Gold, Inc.		5,334		22,290
Chemtrade Logistics Income Fund		2,964		50,486
Dominion Diamond Corp. *		3,645		57,780
Eldorado Gold Corp.		3,670		29,034
HudBay Minerals, Inc.		10,208		81,060
IAMGOLD Corp.		9,620		51,659
Lundin Mining Corp. *		22,864		89,872
Major Drilling Group International, Inc.		4,000		29,897
PAN American Silver Corp.		2,572		33,827
Sherritt International Corp.		27,562		128,857
Silver Wheaton Corp.		974		23,812
Thompson Creek Metals Co., Inc. (a)*		16,468		49,202
West Fraser Timber Co., Ltd.		2,250		196,447
Yamana Gold, Inc.		8,191		101,386
				1,191,441
Media 0.4%
Aimia, Inc.		7,400		116,790
Astral Media, Inc., Class A		1,691		82,246
Cineplex, Inc.		2,319		78,815
Cogeco Cable, Inc.		1,053		46,867
Corus Entertainment, Inc., Class B		3,683		90,444
Torstar Corp, Class B		9,707		65,327
				480,489
Real Estate 0.4%
Boardwalk Real Estate Investment Trust		525		34,326
Brookfield Office Properties, Inc.		6,955		128,061
Calloway Real Estate Investment Trust		1,243		37,273
Canadian Real Estate Investment Trust		732		34,637
Granite Real Estate Investment Trust		1,803		71,497
H&R REIT		2,200		54,047
RioCan REIT		2,806		82,193
				442,034
Retailing 0.1%
Dollarama, Inc.		1,114		81,605
Reitmans (Canada) Ltd., Class A		6,848		60,157
				141,762
Software & Services 0.1%
MacDonald, Dettwiler & Associates Ltd.		1,018		73,532
Open Text Corp. *		1,023		66,846
				140,378
Telecommunication Services 0.1%
Manitoba Telecom Services, Inc.		3,200		103,739
Transportation 0.1%
TransForce, Inc.		4,900		96,691
Westshore Terminals Investment Corp.		1,400		40,300
				136,991
Utilities 1.0%
Algonquin Power & Utilities Corp.		5,100		40,296
Atco Ltd., Class I		2,170		207,835
Canadian Utilities Ltd., Class A		1,783		146,753
Capital Power Corp.		4,441		97,024
Emera, Inc.		4,394		160,940
Just Energy Group, Inc. (a)		9,031		60,598
Northland Power, Inc.		2,440		47,349
Superior Plus Corp.		15,800		203,881

See financial notes 35

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Valener, Inc.		9,602		153,925
				1,118,601
				8,748,560
Denmark 1.4%
Banks 0.2%
Jyske Bank A/S - Reg’d *		4,375		170,447
Sydbank A/S *		5,553		126,692
				297,139
Capital Goods 0.1%
NKT Holding A/S		2,569		94,929
Rockwool International A/S, B Shares		693		91,710
				186,639
Consumer Durables & Apparel 0.1%
Pandora A/S		2,198		67,253
Food, Beverage & Tobacco 0.1%
East Asiatic Co., Ltd. A/S *		4,722		82,642
Royal UNIBREW A/S		363		32,879
				115,521
Health Care Equipment & Services 0.2%
Coloplast A/S, Class B		1,840		100,108
GN Store Nord A/S		4,294		78,534
William Demant Holding A/S *		494		39,554
				218,196
Insurance 0.2%
Topdanmark A/S *		5,020		128,867
Tryg A/S		1,352		117,182
				246,049
Materials 0.2%
Christian Hansen Holding A/S		976		35,220
Novozymes A/S, B Shares		4,645		160,769
				195,989
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
H. Lundbeck A/S		4,699		93,962
Software & Services 0.1%
SimCorp A/S		254		74,248
Transportation 0.1%
D/S Norden A/S		5,135		158,949
				1,653,945
Finland 1.8%
Automobiles & Components 0.2%
Nokian Renkaat Oyj		3,743		162,596
Capital Goods 0.6%
Cargotec Oyj, B Shares		3,256		97,210
Cramo Oyj		2,875		37,953
Konecranes Oyj (a)		3,360		122,195
Outotec Oyj		9,208		134,712
Ramirent Oyj		5,264		52,219
Uponor Oyj		7,352		108,914
YIT Oyj		8,391		158,853
				712,056
Commercial & Professional Supplies 0.1%
Lassila & Tikanoja Oyj *		3,642		64,497
Consumer Durables & Apparel 0.1%
Amer Sports Oyj		8,025		136,731
Diversified Financials 0.1%
Pohjola Bank plc, A Shares		7,230		123,078
Health Care Equipment & Services 0.0%
Oriola-KD Oyj, B Shares		12,867		39,656
Materials 0.4%
Huhtamaki Oyj (a)		9,248		173,358
Kemira Oyj		8,917		135,012
Metsa Board Oyj, B Shares		30,259		94,211
Tikkurila Oyj		1,701		36,539
				439,120
Media 0.1%
Sanoma Oyj (a)		16,612		136,354
Real Estate 0.0%
Sponda Oyj		8,033		42,872
Retailing 0.1%
Stockmann Oyj Abp, B Shares		3,548		51,444
Software & Services 0.1%
Tieto Oyj		6,975		149,596
				2,058,000
France 4.9%
Automobiles & Components 0.1%
Faurecia		5,924		110,417
Plastic Omnium S.A.		1,683		82,242
				192,659
Banks 0.1%
Natixis		36,809		161,352
Capital Goods 0.3%
Areva S.A. *		4,458		67,720
Mersen		2,237		51,753
Saft Groupe S.A.		2,086		51,332
Zodiac Aerospace		1,419		178,026
				348,831
Commercial & Professional Supplies 0.5%
Bureau Veritas S.A.		1,086		133,069
Derichebourg S.A. *		11,721		47,565
Edenred		3,116		103,805
Societe BIC S.A.		1,082		115,385
Teleperformance		5,313		233,658
				633,482
Consumer Durables & Apparel 0.3%
Beneteau *		3,137		32,843
Hermes International		135		45,588
Nexity S.A.		3,301		118,805
SEB S.A.		1,572		113,982
				311,218
Consumer Services 0.1%
Club Mediterranee S.A. *		3,607		61,304
Diversified Financials 0.1%
Eurazeo		2,606		138,275
Energy 0.1%
Bourbon S.A.		2,583		70,532

36 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Etablissements Maurel et Prom		3,114		53,072
				123,604
Food, Beverage & Tobacco 0.1%
Remy Cointreau S.A.		439		51,104
Vilmorin & Cie		304		38,834
				89,938
Health Care Equipment & Services 0.1%
bioMerieux		661		62,842
Orpea		827		35,965
				98,807
Insurance 0.1%
Euler Hermes S.A.		932		89,120
Materials 0.4%
Ciments Francais S.A.		1,145		62,563
Eramet		836		89,723
Imerys S.A.		2,420		159,333
SA des Ciments Vicat		1,991		117,992
				429,611
Media 0.9%
Eutelsat Communications S.A.		4,941		178,533
Havas S.A.		11,767		71,823
Ipsos		1,474		49,403
JC Decaux S.A.		2,932		80,668
Metropole Television S.A.		7,861		131,716
PagesJaunes Groupe (a)*		50,233		106,091
Societe d’Edition de Canal +		6,635		46,474
Societe Television Francaise 1		14,808		156,455
Technicolor - Reg’d *		51,690		215,441
				1,036,604
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Ipsen S.A.		1,748		62,555
Real Estate 0.5%
Fonciere des Regions (a)		1,965		156,783
Gecina S.A.		802		96,642
ICADE (a)		1,599		147,814
Klepierre		3,229		137,023
Societe Immobilliere de Location pour l’Industrie et le Commerce		363		42,620
				580,882
Software & Services 0.4%
Alten		1,327		47,814
Altran Technologies S.A. *		8,788		69,183
AtoS		2,460		171,373
Dassault Systemes S.A.		854		104,254
UbiSoft Entertainment S.A. *		12,824		143,279
				535,903
Technology Hardware & Equipment 0.2%
Ingenico		822		55,221
Neopost S.A.		3,040		200,391
				255,612
Telecommunication Services 0.1%
Iliad S.A.		406		92,821
Transportation 0.3%
Aeroports de Paris		1,773		160,476
Bollore		237		99,878
Groupe Eurotunnel S.A. - Reg’d		12,816		107,375
				367,729
Utilities 0.1%
Rubis		1,473		94,727
				5,705,034
Germany 3.1%
Automobiles & Components 0.1%
ElringKlinger AG		1,295		42,351
Leoni AG		2,525		114,221
				156,572
Banks 0.1%
Aareal Bank AG *		3,223		77,677
Capital Goods 0.7%
Bauer AG		1,640		47,058
BayWa AG		2,173		109,525
Deutz AG *		8,710		47,206
Duerr AG		519		59,158
Gildemeister AG		3,083		69,716
Heidelberger Druckmaschinen AG (a)*		66,266		145,657
Indus Holding AG		2,294		75,481
Krones AG		865		60,251
Nordex SE (a)*		7,495		56,474
Pfeiffer Vacuum Technology AG		357		43,443
SGL Carbon SE		1,196		40,905
Vossloh AG		438		47,903
				802,777
Consumer Durables & Apparel 0.1%
Gerry Weber International AG		681		29,911
Hugo Boss AG		518		60,373
Puma SE		198		61,395
				151,679
Food, Beverage & Tobacco 0.1%
Suedzucker AG		3,640		146,848
Health Care Equipment & Services 0.1%
Rhoen-klinikum AG		7,198		153,672
Materials 0.3%
Fuchs Petrolub AG		617		47,023
Symrise AG		4,348		185,850
Wacker Chemie AG (a)		1,888		144,496
				377,369
Media 0.3%
Axel Springer AG (a)		2,321		97,943
GfK SE		835		47,648
Kabel Deutschland Holding AG		1,646		156,254
				301,845
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Gerresheimer AG		1,435		81,994
Stada Arzneimittel AG		4,190		169,926
				251,920
Real Estate 0.1%
Deutsche Euroshop AG		835		35,805
Gagfah S.A. *		3,577		46,212
				82,017

See financial notes 37

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Retailing 0.1%
Fielmann AG		648		62,536
Semiconductors & Semiconductor Equipment 0.1%
Aixtron SE		3,883		55,662
Kontron AG		8,132		44,112
SMA Solar Technology AG		1,059		26,315
				126,089
Software & Services 0.2%
Bechtle AG		1,603		71,079
Software AG		2,580		90,418
United Internet AG - Reg’d		3,843		105,518
				267,015
Technology Hardware & Equipment 0.2%
Jenoptik AG		4,168		47,906
Wincor Nixdorf AG		3,380		178,278
				226,184
Telecommunication Services 0.2%
Freenet AG		6,965		173,657
Transportation 0.2%
Fraport AG Frankfurt Airport Services Worldwide		1,809		108,236
Hamburger Hafen und Logistik AG		1,687		36,322
Sixt AG		4,752		103,184
				247,742
				3,605,599
Greece 0.5%
Banks 0.1%
Eurobank Ergasias S.A. *		230,601		59,882
TT Hellenic Postbank S.A. (b)(c)*		24,275		—
				59,882
Diversified Financials 0.1%
Marfin Investment Group Holdings S.A. *		131,714		58,023
Materials 0.1%
Mytilineos Holdings S.A. *		14,521		90,462
Titan Cement Co. S.A. *		8,030		149,684
				240,146
Retailing 0.1%
JUMBO S.A. *		8,918		84,240
Transportation 0.1%
Diana Shipping, Inc. *		5,790		54,947
DryShips, Inc. *		35,368		65,785
				120,732
				563,023
Hong Kong 3.0%
Banks 0.2%
Bank of East Asia Ltd.		36,800		151,625
Wing Hang Bank Ltd.		4,500		47,336
				198,961
Capital Goods 0.3%
Jardine Strategic Holdings Ltd.		4,500		175,722
Johnson Electric Holdings Ltd.		79,000		53,822
NWS Holdings Ltd.		42,000		75,094
				304,638
Consumer Durables & Apparel 0.1%
Techtronic Industries Co., Ltd.		53,000		127,010
Consumer Services 0.2%
Cafe De Coral Holdings Ltd.		14,000		44,489
Sands China Ltd.		14,800		77,818
SJM Holdings Ltd.		43,000		108,559
Wynn Macau Ltd. *		14,400		43,797
				274,663
Diversified Financials 0.3%
First Pacific Co., Ltd.		84,000		116,337
Guoco Group Ltd.		5,000		59,714
Hong Kong Exchanges & Clearing Ltd.		10,100		170,342
Sun Hung Kai & Co., Ltd.		87,000		60,886
				407,279
Media 0.1%
Television Broadcasts Ltd.		8,000		60,332
Real Estate 1.2%
Great Eagle Holdings Ltd.		17,000		72,172
Hang Lung Group Ltd.		17,000		100,356
Hang Lung Properties Ltd.		33,000		128,491
Henderson Land Development Co., Ltd.		14,000		101,592
Hongkong Land Holdings Ltd.		22,000		160,186
Hysan Development Co., Ltd.		8,000		39,730
Kerry Properties Ltd.		19,500		88,479
New World Development Co., Ltd.		109,000		190,542
Sino Land Co., Ltd.		72,000		118,651
Sun Hung Kai Properties Ltd.		9,000		130,141
The Link REIT		34,000		192,739
Wheelock & Co., Ltd.		20,000		111,451
				1,434,530
Retailing 0.1%
Chow Sang Sang Holdings International Ltd.		20,000		54,244
Luk Fook Holdings International Ltd.		11,000		31,289
				85,533
Technology Hardware & Equipment 0.1%
VTech Holdings Ltd.		10,000		127,606
Telecommunication Services 0.0%
Hutchison Telecommunications Hong Kong Holdings Ltd.		74,000		39,507
Transportation 0.4%
Cathay Pacific Airways Ltd.		86,000		151,584
MTR Corp., Ltd.		27,000		111,452
Pacific Basin Shipping Ltd.		246,000		140,723
Seaspan Corp. (a)		2,200		48,246
				452,005
				3,512,064
Ireland 0.9%
Capital Goods 0.3%
Grafton Group plc		32,799		228,582

38 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Kingspan Group plc		10,104		121,974
				350,556
Consumer Services 0.1%
Paddy Power plc		923		77,734
Food, Beverage & Tobacco 0.2%
C&C Group plc		20,363		126,495
Glanbia plc		4,639		62,010
Greencore Group plc		39,051		64,638
				253,143
Health Care Equipment & Services 0.1%
United Drug plc		23,145		108,900
Insurance 0.0%
FBD Holdings plc		3,071		49,887
Materials 0.1%
James Hardie Industries plc CDI		7,493		78,924
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
ICON plc *		2,000		64,240
				983,384
Israel 1.0%
Banks 0.1%
Israel Discount Bank Ltd., Class A *		50,445		84,808
Mizrahi Tefahot Bank Ltd. *		4,553		46,579
				131,387
Capital Goods 0.1%
Clal Industries Ltd.		11,226		44,611
Elbit Systems Ltd.		1,780		74,300
				118,911
Energy 0.2%
Delek Group Ltd.		359		94,651
Oil Refineries Ltd. *		184,237		96,470
Paz Oil Co., Ltd. *		566		88,320
				279,441
Food & Staples Retailing 0.0%
Shufersal Ltd.		13,402		48,805
Materials 0.1%
The Israel Corp., Ltd. *		197		126,857
Software & Services 0.2%
Check Point Software Technologies Ltd. *		3,103		144,662
NICE Systems Ltd. *		1,160		41,146
				185,808
Telecommunication Services 0.3%
Cellcom Israel Ltd.		16,042		155,499
Partner Communications Co., Ltd.		21,055		145,751
				301,250
				1,192,459
Italy 2.9%
Automobiles & Components 0.2%
Piaggio & C. S.p.A.		17,613		45,264
Pirelli & C. S.p.A.		13,443		139,821
				185,085
Banks 0.2%
Banca Carige S.p.A. (a)		89,967		65,485
Banca Piccolo Credito Valtellinese Scarl		69,177		86,611
Banca Popolare Di Sondrio Scarl		10,877		63,133
				215,229
Capital Goods 0.2%
Astaldi S.p.A.		4,808		33,228
C.I.R. S.p.A. - Compagnie Industriali Riunite		83,450		96,482
Danieli S.p.A. - Officine Meccaniche Danieli & C.		388		9,902
Danieli S.p.A. - Officine Meccaniche Danieli & C. - RSP		1,375		23,043
Impregilo S.p.A.		12,397		65,172
Trevi Finanziaria S.p.A.		5,447		41,677
				269,504
Consumer Durables & Apparel 0.4%
Geox S.p.A.		13,106		39,767
Indesit Co., S.p.A.		7,826		61,567
Luxottica Group S.p.A.		3,423		177,292
Prada S.p.A.		4,900		44,245
Safilo Group S.p.A. *		5,382		88,207
Tod’s S.p.A.		397		57,680
				468,758
Consumer Services 0.2%
Autogrill S.p.A.		8,967		116,121
Lottomatica Group S.p.A.		4,028		102,759
				218,880
Diversified Financials 0.1%
Azimut Holding S.p.A.		3,247		60,430
Energy 0.2%
ERG S.p.A.		16,003		153,415
Saras S.p.A. *		95,909		127,705
				281,120
Food, Beverage & Tobacco 0.1%
Davide Campari-Milano S.p.A.		7,641		62,065
Parmalat S.p.A.		33,379		102,944
				165,009
Health Care Equipment & Services 0.0%
Sorin S.p.A. *		15,521		43,506
Insurance 0.4%
Fondiaria-Sai S.p.A. *		43,344		88,462
Mediolanum S.p.A.		9,062		61,065
Milano Assicurazioni S.p.A. *		97,119		63,604
Societa Cattolica di Assicurazioni S.c.r.l. *		4,397		86,323
Unipol Gruppo Finanziario S.p.A. *		38,609		132,154
				431,608
Materials 0.1%
Buzzi Unicem S.p.A.		9,924		151,972
Media 0.0%
Mondadori (Arnoldo) Editore S.p.A. *		37,138		49,418
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Recordati S.p.A.		6,331		65,259

See financial notes 39

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Real Estate 0.1%
Beni Stabili S.p.A.		77,862		54,921
Transportation 0.2%
Alitalia S.p.A. (b)(c)*		14,782		—
Ansaldo STS S.p.A.		4,274		44,169
Autostrada Torino-Milano S.p.A.		6,438		76,778
Societa Iniziative Autostradali e Servizi S.p.A.		6,165		55,778
				176,725
Utilities 0.4%
ACEA S.p.A.		10,479		71,758
Enel Green Power S.p.A.		51,944		110,808
Hera S.p.A.		80,654		164,265
Iren S.p.A.		126,246		128,946
				475,777
				3,313,201
Japan 37.5%
Automobiles & Components 3.2%
Aisan Industry Co., Ltd.		4,000		38,421
Akebono Brake Industry Co., Ltd.		8,200		39,470
Calsonic Kansei Corp.		23,000		109,278
EXEDY Corp.		3,500		87,867
F.C.C. Co., Ltd.		3,800		96,335
Futaba Industrial Co., Ltd. *		17,500		81,487
Keihin Corp.		7,300		119,373
Koito Manufacturing Co., Ltd.		9,000		174,111
KYB Co., Ltd.		17,000		92,900
Mitsubishi Motors Corp. *		120,000		141,753
Musashi Seimitsu Industry Co., Ltd.		3,100		74,892
NGK Spark Plug Co., Ltd.		13,000		219,164
Nifco, Inc.		3,900		89,046
Nissan Shatai Co., Ltd.		12,000		160,119
Nissin Kogyo Co., Ltd.		5,200		114,992
NOK Corp.		8,300		119,692
Press Kogyo Co., Ltd.		10,000		51,156
Riken Corp.		9,000		36,316
Sanden Corp.		13,000		54,415
Showa Corp.		7,300		105,978
Sumitomo Rubber Industries Ltd.		12,300		227,120
T RAD Co., Ltd.		12,000		34,349
Tachi-S Co., Ltd.		3,500		64,631
Takata Corp.		4,500		86,572
The Yokohama Rubber Co., Ltd.		16,000		210,105
Tokai Rika Co., Ltd.		7,300		147,915
Tokai Rubber Industries Ltd.		6,200		69,616
Topre Corp.		3,700		34,511
Toyo Tire & Rubber Co., Ltd.		25,000		134,531
Toyoda Gosei Co., Ltd.		6,900		179,075
Toyota Boshoku Corp.		12,800		183,982
TS Tech Co., Ltd.		5,400		163,983
Unipres Corp.		3,400		75,674
Yorozu Corp.		2,400		40,112
				3,658,941
Banks 2.4%
Fukuoka Financial Group, Inc.		32,000		163,703
Hokuhoku Financial Group, Inc.		87,000		203,022
Kiyo Holdings, Inc.		21,000		36,652
Senshu Ikeda Holdings, Inc.		6,000		31,745
Seven Bank Ltd.		19,100		67,823
Shinsei Bank Ltd.		90,000		252,603
Sumitomo Mitsui Trust Holdings, Inc.		49,000		246,250
Suruga Bank Ltd.		5,000		88,460
The 77 Bank Ltd.		12,000		71,242
The Awa Bank Ltd.		7,000		41,390
The Bank of Kyoto Ltd.		7,000		73,648
The Chiba Bank Ltd.		21,000		163,058
The Chugoku Bank Ltd.		5,000		87,180
The Daishi Bank Ltd.		11,000		43,513
The Gunma Bank Ltd.		15,000		95,427
The Hachijuni Bank Ltd.		17,000		115,742
The Hiroshima Bank Ltd.		16,000		84,345
The Hyakugo Bank Ltd.		8,000		40,050
The Iyo Bank Ltd.		8,000		83,789
The Joyo Bank Ltd.		16,000		98,352
The Juroku Bank Ltd.		14,000		59,521
The Kagoshima Bank Ltd.		7,000		51,256
The Keiyo Bank Ltd.		9,000		55,361
The Musashino Bank Ltd.		1,200		51,019
The Nishi-Nippon City Bank Ltd.		22,000		73,392
The Ogaki Kyoritsu Bank Ltd.		13,000		48,344
The San-in Godo Bank Ltd.		7,000		59,701
The Shiga Bank Ltd.		5,000		35,219
The Shizuoka Bank Ltd.		12,000		146,885
Yamaguchi Financial Group, Inc.		8,000		86,879
				2,755,571
Capital Goods 6.8%
Aica Kogyo Co., Ltd.		3,500		70,501
Amada Co., Ltd.		28,000		224,679
Asahi Diamond Industrial Co., Ltd.		3,000		31,441
Central Glass Co., Ltd.		27,000		95,495
Chiyoda Corp.		7,000		71,967
CKD Corp.		5,900		43,089
COMSYS Holdings Corp.		12,500		165,533
Daifuku Co., Ltd.		12,500		110,624
Daihen Corp.		12,000		36,552
Ebara Corp.		33,000		138,561
Fuji Electric Co., Ltd.		52,000		177,922
Fuji Machine Manufacturing Co., Ltd.		6,400		55,588
Fujitec Co., Ltd.		6,000		65,048
Furukawa Co., Ltd.		39,000		50,115
Futaba Corp.		4,000		55,787
Glory Ltd.		4,500		123,657
GS Yuasa Corp.		22,000		93,267
Hino Motors Ltd.		19,000		290,222
Hitachi Cable Ltd. *		47,000		81,278
Hitachi Construction Machinery Co., Ltd.		8,500		202,202
Hitachi Koki Co., Ltd.		5,100		44,300
Hitachi Zosen Corp.		57,000		94,778
Hoshizaki Electric Co., Ltd.		2,900		96,587
Inaba Denki Sangyo Co., Ltd.		2,400		70,869
Inabata & Co., Ltd.		11,700		91,740
Iseki & Co., Ltd.		12,000		43,698
Iwatani Corp.		28,000		125,040
Kamei Corp.		7,200		72,920
Kandenko Co., Ltd.		19,000		86,330
Kanematsu Corp. *		64,000		88,761
Keihan Electric Railway Co., Ltd.		19,000		81,728
Kinden Corp.		22,000		160,503
Kitz Corp.		11,700		67,618

40 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Komori Corp.		8,200		101,658
Kurita Water Industries Ltd.		6,100		125,226
Kuroda Electric Co., Ltd.		5,400		71,780
Kyowa Exeo Corp.		11,200		132,237
Mabuchi Motor Co., Ltd.		1,400		76,017
Maeda Corp.		15,000		71,947
Maeda Road Construction Co., Ltd.		6,000		90,774
Makino Milling Machine Co., Ltd.		7,000		41,626
Meidensha Corp.		12,000		35,876
Minebea Co., Ltd. (a)		38,000		121,448
Mirait Holdings Corp.		9,800		105,838
Misumi Group, Inc.		3,600		109,918
Mitsui Engineering & Shipbuilding Co., Ltd.		112,000		207,233
Mitsui Matsushima Co., Ltd.		18,000		34,881
Miura Co., Ltd.		1,900		44,729
Mori Seiki Co., Ltd.		9,400		118,129
Nabtesco Corp.		3,600		79,443
Nachi-Fujikoshi Corp.		11,000		49,163
Nichias Corp.		10,000		61,111
Nippo Corp.		6,000		89,918
Nishimatsu Construction Co., Ltd.		50,000		95,836
Nisshinbo Holdings, Inc.		15,000		108,969
Nitta Corp.		2,100		47,055
Nitto Boseki Co., Ltd. *		11,000		38,799
Nitto Kogyo Corp.		2,300		34,269
Noritake Co., Ltd.		11,000		29,705
Noritz Corp.		3,300		70,020
NTN Corp. *		63,000		160,661
Oiles Corp.		1,800		36,227
Okuma Corp.		9,000		70,446
Okumura Corp.		16,000		64,830
OSG Corp.		3,600		54,774
Penta-Ocean Construction Co., Ltd.		24,500		63,001
Ryobi Ltd.		23,000		53,962
Sankyo Tateyama, Inc. *		2,600		71,758
Sanwa Holdings Corp.		20,000		121,371
Shima Seiki Mfg., Ltd.		2,200		47,630
ShinMaywa Industries Ltd.		9,000		73,284
Sintokogio Ltd.		4,600		41,658
Sumikin Bussan Corp.		29,000		94,759
Tadano Ltd.		6,000		75,106
Taihei Dengyo Kaisha Ltd.		5,000		30,470
Taihei Kogyo Co., Ltd.		9,000		31,885
Taikisha Ltd.		2,400		54,388
Takara Standard Co., Ltd.		7,000		54,928
Takasago Thermal Engineering Co., Ltd.		7,000		55,229
The Japan Steel Works Ltd.		19,000		96,528
The Nippon Road Co., Ltd.		9,000		53,828
The Nippon Signal Co., Ltd.		5,200		41,864
THK Co., Ltd.		7,300		153,747
TOA Corp. *		26,000		40,045
Toda Corp.		32,000		94,353
Toshiba Machine Co., Ltd.		11,000		67,265
Toshiba Plant Systems & Services Corp.		3,000		40,621
TOTO Ltd.		21,000		217,798
Toyo Engineering Corp.		13,000		62,207
Trusco Nakayama Corp.		3,200		66,135
Tsubakimoto Chain Co.		10,000		53,586
Ushio, Inc.		7,900		80,494
Yamazen Corp.		6,800		43,306
Yuasa Trading Co., Ltd.		24,000		50,783
				7,920,932
Commercial & Professional Supplies 0.7%
Duskin Co., Ltd.		5,100		103,558
Kokuyo Co., Ltd.		14,600		117,788
Matsuda Sangyo Co., Ltd.		2,600		37,676
Meitec Corp.		2,200		56,694
Moshi Moshi Hotline, Inc.		3,000		44,432
Nissha Printing Co., Ltd. *		5,500		88,875
Okamura Corp.		7,000		53,071
Park24 Co., Ltd.		2,900		58,516
Sato Holdings Corp.		2,500		52,418
Sohgo Security Services Co., Ltd.		8,000		127,940
Toppan Forms Co., Ltd.		6,900		64,773
				805,741
Consumer Durables & Apparel 1.7%
Alpine Electronics, Inc.		6,700		68,384
Asics Corp.		7,500		135,395
Foster Electric Co., Ltd.		2,700		36,846
Funai Electric Co., Ltd. *		6,500		80,459
Gunze Ltd.		29,000		75,671
Haseko Corp. *		139,000		203,064
Heiwa Corp.		1,800		37,367
JVC KENWOOD Corp.		23,960		62,040
Kurabo Industries Ltd.		27,000		50,748
Onward Holdings Co., Ltd.		14,000		130,826
PanaHome Corp.		10,000		78,715
Pioneer Corp. *		43,300		88,999
Rinnai Corp.		1,300		103,370
Sangetsu Co., Ltd.		2,600		74,552
Sankyo Co., Ltd.		3,400		154,963
Sanyo Shokai Ltd.		15,000		45,551
Sumitomo Forestry Co., Ltd.		16,700		199,056
Tamron Co., Ltd.		1,000		21,934
The Japan Wool Textile Co., Ltd.		5,000		43,135
Token Corp.		1,100		70,910
Tomy Co., Ltd.		8,300		41,413
Unitika Ltd. *		67,000		43,965
Wacoal Holdings Corp.		7,000		77,295
				1,924,658
Consumer Services 0.7%
Accordia Golf Co., Ltd.		65		73,811
Doutor Nichires Holdings Co., Ltd.		3,600		51,361
H.I.S. Co., Ltd.		2,200		94,888
McDonald’s Holdings Co., Ltd.		4,500		131,236
MOS Food Services, Inc.		1,600		31,923
Plenus Co., Ltd.		2,700		48,937
Resorttrust, Inc.		1,800		61,335
Round One Corp.		7,700		64,541
Saizeriya Co., Ltd.		2,900		41,067
Tokyo Dome Corp.		11,000		84,989
Yoshinoya Holdings Co., Ltd.		50		58,274
Zensho Holdings Co., Ltd.		3,400		45,080
				787,442
Diversified Financials 1.1%
Acom Co., Ltd. *		3,190		130,705
AEON Financial Service Co., Ltd.		3,600		107,932
Aiful Corp. *		31,750		362,746
Hitachi Capital Corp.		2,600		64,821

See financial notes 41

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Jaccs Co., Ltd.		15,000		103,530
Mitsubishi UFJ Lease & Finance Co., Ltd.		14,700		83,034
Orient Corp. *		45,000		156,088
SBI Holdings, Inc.		13,700		265,384
				1,274,240
Energy 0.2%
AOC Holdings, Inc.		19,700		69,306
Japan Petroleum Exploration Co.		2,200		87,357
Shinko Plantech Co., Ltd.		4,400		33,251
				189,914
Food & Staples Retailing 1.0%
Arcs Co., Ltd.		4,100		81,345
Cawachi Ltd.		3,500		78,790
cocokara fine, Inc.		2,200		83,176
FamilyMart Co., Ltd.		2,600		118,821
Heiwado Co., Ltd.		5,300		95,811
Kato Sangyo Co., Ltd.		5,000		106,234
Matsumotokiyoshi Holdings Co., Ltd.		4,300		123,088
Sugi Holdings Co., Ltd.		2,300		88,274
Sundrug Co., Ltd.		1,900		83,559
Tsuruha Holdings, Inc.		1,100		107,191
Valor Co., Ltd.		5,300		100,292
Welcia Holdings Co., Ltd.		800		42,061
				1,108,642
Food, Beverage & Tobacco 2.2%
Calbee, Inc.		900		88,980
Coca-Cola Central Japan Co., Ltd. (a)		5,700		85,926
Coca-Cola West Co., Ltd.		9,100		169,250
DyDo Drinco, Inc.		1,000		44,714
Ezaki Glico Co., Ltd.		6,000		67,447
Fuji Oil Co., Ltd.		5,300		84,062
Hokuto Corp.		1,600		30,827
House Foods Corp.		6,800		118,582
Ito En Ltd.		4,900		118,071
Itoham Foods, Inc.		27,000		124,151
J-Oil Mills, Inc.		14,000		43,513
Kagome Co., Ltd.		4,300		77,582
Kewpie Corp.		10,300		155,308
Marudai Food Co., Ltd.		19,000		63,071
Maruha Nichiro Holdings, Inc.		50,000		99,986
Megmilk Snow Brand Co., Ltd.		5,900		90,695
Mitsui Sugar Co., Ltd.		10,000		31,409
Morinaga Milk Industry Co., Ltd.		38,000		111,952
Nichirei Corp.		26,000		152,954
Nippon Flour Mills Co., Ltd.		18,000		83,689
Nippon Suisan Kaisha Ltd. *		36,200		70,251
Nissin Food Holdings Co., Ltd.		3,800		170,449
Prima Meat Packers Ltd.		19,000		52,779
Sapporo Holdings Ltd.		33,000		150,239
Takara Holdings, Inc.		11,000		94,383
The Nisshin Oillio Group Ltd.		16,000		56,381
Warabeya Nichiyo Co., Ltd.		2,500		42,495
Yakult Honsha Co., Ltd.		3,000		130,765
				2,609,911
Health Care Equipment & Services 0.5%
Miraca Holdings, Inc.		2,800		139,627
Nichii Gakkan Co.		4,900		49,883
Nihon Kohden Corp.		1,900		72,962
Nipro Corp.		9,400		93,833
Sysmex Corp.		1,700		109,634
Toho Holdings Co., Ltd.		5,000		114,699
				580,638
Household & Personal Products 0.5%
Fancl Corp.		4,500		49,163
Kobayashi Pharmaceutical Co., Ltd.		1,300		71,026
Kose Corp.		2,600		67,912
Lion Corp.		16,000		93,487
Mandom Corp.		1,600		58,589
Pigeon Corp.		700		60,220
Pola Orbis Holdings, Inc.		1,600		56,661
Unicharm Corp.		2,500		161,653
				618,711
Insurance 0.0%
Sony Financial Holdings, Inc.		3,599		50,843
Materials 4.4%
Adeka Corp.		11,400		102,635
Aichi Steel Corp.		13,000		53,136
Air Water, Inc.		12,000		194,307
Asahi Holdings, Inc.		3,400		68,830
Chugoku Marine Paints Ltd.		8,000		40,387
Daicel Corp.		25,000		201,770
Daido Steel Co., Ltd.		20,000		109,007
Daio Paper Corp.		17,000		102,037
Denki Kagaku Kogyo K.K.		48,000		175,605
Dowa Holdings Co., Ltd.		19,000		136,183
Earth Chemical Co., Ltd.		1,100		38,891
FP Corp.		600		39,797
Fuji Seal International, Inc.		2,300		64,864
Furukawa-Sky Aluminum Corp.		11,000		34,040
Godo Steel Ltd.		24,000		39,563
Hitachi Metals Ltd.		12,000		124,063
Hokuetsu Kishu Paper Co., Ltd.		11,500		51,147
Ishihara Sangyo Kaisha Ltd. *		42,000		37,169
Kansai Paint Co., Ltd.		10,000		128,319
Kureha Corp.		16,000		56,568
Kyoei Steel Ltd.		3,000		57,423
Lintec Corp.		5,000		91,039
Maruichi Steel Tube Ltd.		3,500		88,506
Mitsubishi Paper Mills Ltd. *		51,000		50,387
Mitsubishi Steel Mfg. Co., Ltd.		19,000		40,772
Nihon Parkerizing Co., Ltd.		3,000		61,108
Nippon Denko Co., Ltd.		16,000		56,014
Nippon Kayaku Co., Ltd.		9,000		129,760
Nippon Light Metal Holdings Co., Ltd.		104,800		123,439
Nippon Paint Co., Ltd.		10,000		118,654
Nippon Shokubai Co., Ltd.		10,000		98,389
Nippon Soda Co., Ltd.		13,000		60,551
Nissan Chemical Industries Ltd.		10,400		134,800
Nisshin Steel Holdings Co., Ltd.		15,800		132,967
Nittetsu Mining Co., Ltd.		10,000		48,432
Nof Corp.		14,000		75,418
Pacific Metals Co., Ltd.		21,000		105,724
Rengo Co., Ltd.		25,000		121,036
Sakai Chemical Industry Co., Ltd.		17,000		53,432
Sanyo Chemical Industries Ltd.		7,000		41,329
Sanyo Special Steel Co., Ltd. (a)		15,000		60,891
Sumitomo Bakelite Co., Ltd.		22,000		89,278
Sumitomo Light Metal Industries Ltd.		43,000		44,653
Sumitomo Osaka Cement Co., Ltd.		28,000		83,935
Taiyo Nippon Sanso Corp.		23,000		152,829

42 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Toagosei Co., Ltd.		23,000		99,144
Toho Zinc Co., Ltd.		13,000		48,635
Tokai Carbon Co., Ltd.		22,000		74,313
Tokuyama Corp. (a)		67,000		180,290
Tokyo Ohka Kogyo Co., Ltd.		2,800		60,695
Tokyo Steel Manufacturing Co., Ltd.		25,200		102,857
Topy Industries Ltd.		29,000		67,674
Toyo Ink SC Holdings Co., Ltd.		21,000		97,976
Toyo Kohan Co., Ltd.		11,000		36,343
Toyobo Co., Ltd.		91,000		158,816
Yamato Kogyo Co., Ltd.		2,800		92,609
Yodogawa Steel Works Ltd.		20,000		75,615
Zeon Corp.		11,000		118,438
				5,132,489
Media 0.6%
Asatsu-DK, Inc.		4,100		105,026
Avex Group Holdings, Inc.		1,700		48,529
Daiichikosho Co., Ltd.		3,300		98,135
Jupiter Telecommunications Co., Ltd.		74		93,141
Kadokawa Group Holdings, Inc. (a)		1,500		47,077
SKY Perfect JSAT Holdings, Inc.		160		80,499
Toho Co., Ltd.		5,000		111,174
Tokyo Broadcasting System Holdings, Inc.		3,300		52,248
TV Asahi Corp.		2,200		45,952
				681,781
Pharmaceuticals, Biotechnology & Life Sciences 1.1%
Chugai Pharmaceutical Co., Ltd.		8,000		199,178
Dainippon Sumitomo Pharma Co., Ltd.		6,400		117,551
Hisamitsu Pharmaceutical Co., Inc.		1,900		111,718
Kaken Pharmaceutical Co., Ltd.		3,000		53,197
Kissei Pharmaceutical Co., Ltd.		1,800		39,053
Kyorin Holdings, Inc.		2,200		58,783
Kyowa Hakko Kirin Co., Ltd.		13,000		159,568
Mitsubishi Tanabe Pharma Corp.		9,500		144,508
Mochida Pharmaceutical Co., Ltd.		4,000		53,186
Nippon Shinyaku Co., Ltd.		3,000		46,601
Rohto Pharmaceutical Co., Ltd.		5,000		70,039
Santen Pharmaceutical Co., Ltd.		2,800		140,546
Sawai Pharmaceutical Co., Ltd.		300		38,753
Tsumura & Co.		2,300		75,154
				1,307,835
Real Estate 1.7%
Advance Residence Investment Corp.		27		64,703
Aeon Mall Co., Ltd.		2,000		64,392
Daikyo, Inc.		14,000		54,144
Japan Prime Realty Investment Corp.		15		55,121
Japan Real Estate Investment Corp.		10		134,334
Japan Retail Fund Investment Corp.		47		111,412
Kenedix Realty Investment Corp.		11		51,603
Kenedix, Inc. *		175		126,705
Leopalace21 Corp. *		34,700		192,322
Nippon Building Fund, Inc.		12		172,900
Nomura Real Estate Holdings, Inc.		4,800		129,042
Nomura Real Estate Office Fund, Inc.		9		57,505
NTT Urban Development Corp.		43		63,754
Orix JREIT, Inc.		40		54,149
Tokyo Tatemono Co., Ltd.		25,000		231,701
Tokyu Land Corp.		25,000		307,377
United Urban Investment Corp.		34		56,015
				1,927,179
Retailing 2.4%
ABC-Mart, Inc.		800		29,968
Alpen Co., Ltd.		1,800		37,578
Aoyama Trading Co., Ltd.		7,100		212,464
Arata Corp.		14,000		54,655
Arc Land Sakamoto Co., Ltd.		1,900		40,634
ASKUL Corp.		2,400		42,701
Autobacs Seven Co., Ltd.		8,100		136,497
Bic Camera, Inc. (a)		91		39,870
Canon Marketing Japan, Inc.		11,000		160,226
Chiyoda Co., Ltd.		2,200		63,512
DCM Holdings Co., Ltd.		15,300		151,059
Don Quijote Co., Ltd.		2,300		125,327
Doshisha Co., Ltd.		2,200		34,701
GEO Holdings Corp.		73		87,263
H2O Retailing Corp.		11,000		122,569
Hikari Tsushin, Inc.		1,100		59,983
Izumi Co., Ltd.		2,900		78,251
K’s Holdings Corp.		6,140		216,456
Kohnan Shoji Co., Ltd.		5,200		63,870
Komeri Co., Ltd.		2,800		87,070
NEC Mobiling Ltd.		900		51,223
Nitori Holdings Co., Ltd.		1,650		124,480
Parco Co., Ltd.		4,000		52,437
Point, Inc.		1,120		54,409
Rakuten, Inc.		6,700		71,465
Ryohin Keikaku Co., Ltd.		1,800		169,988
The Daiei, Inc. *		58,600		230,343
USS Co., Ltd.		790		101,345
Xebio Co., Ltd.		3,300		77,791
				2,778,135
Semiconductors & Semiconductor Equipment 0.7%
Advantest Corp.		8,300		124,357
Dainippon Screen Manufacturing Co., Ltd. *		12,000		61,894
Disco Corp.		1,000		64,623
Mimasu Semiconductor Industry Co., Ltd.		3,700		37,452
Renesas Electronics Corp. (a)*		26,900		78,294
Sanken Electric Co., Ltd.		13,000		60,870
Shinko Electric Industries Co., Ltd.		9,800		99,931
Sumco Corp.		14,300		150,106
Tokyo Seimitsu Co., Ltd.		2,000		44,019
ULVAC, Inc. *		8,000		62,576
				784,122
Software & Services 1.4%
Capcom Co., Ltd.		2,900		47,635
Dena Co., Ltd.		1,786		50,876
DTS Corp.		2,600		43,469
Fuji Soft, Inc.		2,900		77,574
IT Holdings Corp.		12,900		193,652
Itochu Techno-Solutions Corp.		1,700		80,899
NEC Networks & System Integration Corp.		3,600		78,936
Net One Systems Co., Ltd.		7,600		66,666
Nihon Unisys Ltd.		9,200		79,033
Nomura Research Institute Ltd.		7,000		210,859
NS Solutions Corp.		1,700		34,632

See financial notes 43

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
NSD Co., Ltd.		4,200		47,860
OBIC Co., Ltd.		220		58,044
Oracle Corp., Japan		1,500		64,261
Otsuka Corp.		1,400		145,130
SCSK Corp.		2,776		61,860
Square Enix Holdings Co., Ltd.		5,700		70,051
Transcosmos, Inc.		2,600		36,316
Trend Micro, Inc.		3,500		98,129
Yahoo Japan Corp.		264		132,657
				1,678,539
Technology Hardware & Equipment 2.3%
Alps Electric Co., Ltd.		24,200		184,482
Amano Corp.		5,700		61,114
Anritsu Corp.		3,000		44,862
Azbil Corp.		5,800		125,240
Canon Electronics, Inc.		1,800		36,650
Citizen Holdings Co., Ltd.		26,200		154,999
Cmk Corp. *		11,400		39,725
Daiwabo Holdings Co., Ltd.		21,000		39,677
Eizo Corp.		2,400		41,559
Hamamatsu Photonics K.K.		2,300		94,828
Hirose Electric Co., Ltd.		1,300		186,926
Hitachi Kokusai Electric, Inc.		5,000		58,884
Horiba Ltd.		2,300		83,155
Hosiden Corp.		22,600		129,401
Japan Aviation Electronics Industry Ltd.		7,000		60,662
Macnica, Inc.		1,600		32,807
Nichicon Corp.		5,400		56,914
Nippon Chemi-Con Corp. *		23,000		78,409
Oki Electric Industry Co., Ltd. *		73,000		140,499
Riso Kagaku Corp.		2,100		40,154
Ryosan Co., Ltd.		6,600		119,677
Ryoyo Electro Corp.		5,500		49,668
Shimadzu Corp.		16,000		116,911
SMK Corp.		11,000		32,292
Star Micronics Co., Ltd.		4,100		47,652
Taiyo Yuden Co., Ltd.		11,700		169,478
Toshiba Tec Corp.		18,000		106,363
Yaskawa Electric Corp.		13,000		159,064
Yokogawa Electric Corp.		12,500		127,113
				2,619,165
Transportation 1.7%
ANA Holdings, Inc.		72,000		156,819
Fukuyama Transporting Co., Ltd.		13,000		72,593
Hitachi Transport System Ltd.		4,600		73,127
Japan Airport Terminal Co., Ltd.		4,000		61,783
Kamigumi Co., Ltd.		20,000		187,535
Keikyu Corp.		11,000		121,729
Keio Corp.		21,000		180,638
Keisei Electric Railway Co., Ltd.		10,000		105,728
Kintetsu World Express, Inc.		2,100		75,632
Mitsubishi Logistics Corp.		6,000		107,262
Mitsui-Soko Co., Ltd.		9,000		61,355
Nippon Konpo Unyu Soko Co., Ltd.		5,600		86,467
Nishi-Nippon Railroad Co., Ltd.		21,000		86,055
Odakyu Electric Railway Co., Ltd.		16,000		192,688
Sankyu, Inc.		34,000		151,965
Senko Co., Ltd.		9,000		48,797
Sotetsu Holdings, Inc.		18,000		70,054
The Sumitomo Warehouse Co., Ltd.		9,000		64,482
Yusen Logistics Co., Ltd.		3,000		31,587
				1,936,296
Utilities 0.2%
The Okinawa Electric Power Co., Inc.		2,600		96,003
Toho Gas Co., Ltd.		29,000		172,907
				268,910
				43,400,635
Luxembourg 0.5%
Banks 0.1%
Espirito Santo Financial Group S.A. (a)*		22,148		153,202
Commercial & Professional Supplies 0.1%
Regus plc		39,594		100,848
Household & Personal Products 0.1%
Oriflame Cosmetics S.A. SDR		2,559		92,767
Materials 0.1%
Ternium S.A. ADR		5,900		138,119
Telecommunication Services 0.1%
Colt Group S.A. *		48,323		86,322
				571,258
Netherlands 1.6%
Capital Goods 0.5%
Aalberts Industries N.V.		5,696		127,836
AerCap Holdings N.V. *		3,961		62,861
Arcadis N.V.		3,247		89,769
Koninklijke Boskalis Westminster N.V.		4,160		173,550
Royal Imtech N.V. (a)*		7,294		81,073
Sensata Technologies Holding N.V. *		1,200		40,140
				575,229
Commercial & Professional Supplies 0.1%
USG People N.V.		20,373		159,362
Consumer Durables & Apparel 0.1%
Accell Group		2,229		40,715
TomTom N.V. (a)*		15,387		69,487
				110,202
Food & Staples Retailing 0.2%
Sligro Food Group N.V.		3,238		106,748
X5 Retail Group N.V. - Reg’d GDR *		3,583		62,871
				169,619
Materials 0.1%
AMG Advanced Metallurgical Group N.V. *		3,982		36,739
Koninklijke Ten Cate N.V.		3,002		72,913
				109,652
Real Estate 0.3%
Corio N.V.		2,760		127,825
Eurocommercial Properties N.V.		1,204		49,137
VastNed Retail N.V.		1,464		65,401
Wereldhave N.V.		1,129		82,107
				324,470
Semiconductors & Semiconductor Equipment 0.0%
ASM International N.V.		1,497		50,005

44 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Software & Services 0.0%
Unit 4 N.V.		1,068		36,399
Technology Hardware & Equipment 0.2%
Gemalto N.V.		1,888		154,330
TKH Group N.V. CVA		2,531		68,791
				223,121
Telecommunication Services 0.0%
Ziggo N.V.		1,055		37,728
Transportation 0.1%
Koninklijke Vopak N.V.		1,321		73,154
				1,868,941
New Zealand 0.4%
Consumer Services 0.1%
SKYCITY Entertainment Group Ltd.		25,430		97,273
Health Care Equipment & Services 0.0%
Fisher & Paykel Healthcare Corp., Ltd.		23,202		52,753
Materials 0.1%
Nuplex Industries Ltd.		23,497		67,135
Media 0.1%
Sky Network Television Ltd.		12,108		59,408
Transportation 0.0%
Auckland International Airport Ltd.		20,349		54,091
Utilities 0.1%
Contact Energy Ltd.		18,409		83,314
				413,974
Norway 1.1%
Banks 0.1%
SpareBank 1 SR Bank A.S.A.		6,778		60,534
Sparebanken 1 SMN		6,798		57,882
				118,416
Capital Goods 0.1%
Veidekke A.S.A.		10,032		79,217
Commercial & Professional Supplies 0.1%
Tomra Systems A.S.A.		6,755		63,257
Diversified Financials 0.0%
Aker ASA, Class A (a)		1,634		50,530
Energy 0.3%
Fred Olsen Energy A.S.A.		1,760		76,781
Petroleum Geo-Services A.S.A.		11,105		163,159
TGS Nopec Geophysical Co. A.S.A.		4,202		151,092
				391,032
Food, Beverage & Tobacco 0.1%
Cermaq A.S.A.		4,154		62,041
Insurance 0.2%
Gjensidige Forsikring A.S.A. (a)		7,997		128,967
Storebrand ASA *		16,862		76,919
				205,886
Media 0.1%
Schibsted A.S.A.		2,229		97,014
Semiconductors & Semiconductor Equipment 0.1%
Renewable Energy Corp. A.S.A. (a)*		322,466		89,640
Software & Services 0.0%
Atea A.S.A.		4,804		51,928
Transportation 0.0%
Golden Ocean Group Ltd. *		58,147		56,058
				1,265,019
Portugal 0.5%
Banks 0.1%
Banco BPI S.A. - Reg’d *		62,580		89,857
Capital Goods 0.1%
Sonae		144,196		140,011
Food & Staples Retailing 0.1%
Jeronimo Martins, SGPS, S.A.		4,992		118,895
Materials 0.1%
CIMPOR-Cimentos de Portugal, SGPS, S.A.		10,091		45,449
Semapa-Sociedade de Investimento e Gestao, SGPS, S.A.		8,670		81,981
				127,430
Media 0.1%
Zon Multimedia-Servicos de Telecomunicacoes e Multimedia SGPS, S.A.		16,497		74,085
Utilities 0.0%
Redes Energeticas Nacionais S.A.		13,574		41,330
				591,608
Republic of Korea 0.0%
Automobiles & Components 0.0%
Zyle Motor Sales Corp. (b)(c)*		2,480		—
Capital Goods 0.0%
Daewoo Industrial Development Co., Ltd. (b)(c)*		1,773		—
				—
Singapore 1.8%
Capital Goods 0.3%
Cosco Corp., (Singapore) Ltd.		61,431		43,798
SembCorp Marine Ltd.		30,096		105,732
Singapore Technologies Engineering Ltd.		45,000		161,057
				310,587
Diversified Financials 0.1%
Singapore Exchange Ltd.		14,000		85,250
Energy 0.0%
Sakari Resources Ltd (b)(c)		18,000		21,629
Food & Staples Retailing 0.1%
Olam International Ltd.		59,704		81,585
Food, Beverage & Tobacco 0.1%
Golden Agri-Resources Ltd.		203,000		87,477
Real Estate 0.6%
Ascendas REIT		28,000		62,693
CapitaCommercial Trust		31,302		43,584
CapitaLand Ltd.		59,000		179,929

See financial notes 45

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
CapitaMall Trust		38,000		71,651
City Developments Ltd.		14,000		128,352
Keppel Land Ltd.		14,000		46,254
Suntec Real Estate Investment Trust		36,000		56,922
UOL Group Ltd.		12,000		69,674
Wing Tai Holdings Ltd.		30,000		53,145
				712,204
Retailing 0.2%
Jardine Cycle & Carriage Ltd.		5,000		198,172
Telecommunication Services 0.1%
M1 Ltd.		18,000		49,395
StarHub Ltd.		23,000		88,446
				137,841
Transportation 0.3%
Hutchison Port Holdings Trust, Class U		135,000		112,247
Neptune Orient Lines Ltd. (a)*		140,000		124,902
SATS Ltd.		27,749		70,945
Singapore Post Ltd.		55,000		57,638
SMRT Corp., Ltd.		33,000		39,657
				405,389
				2,040,134
Spain 2.1%
Banks 0.2%
Banco Espanol de Credito S.A. *		14,156		65,213
Bankinter S.A. (b)		13,415		49,397
Bankinter S.A.		24,147		88,797
Caja de Ahorros del Mediterraneo (b)(c)*		5,382		—
				203,407
Capital Goods 0.5%
Abengoa S.A.		9,240		24,726
Construcciones y Auxiliar de Ferrocarriles S.A.		77		30,394
Gamesa Corp. Tecnologica S.A.		72,453		283,262
Obrascon Huarte Lain S.A.		3,150		116,500
Sacyr Vallehermoso S.A. *		23,082		48,033
Zardoya Otis S.A.		7,212		100,761
				603,676
Commercial & Professional Supplies 0.0%
Prosegur Cia de Seguridad S.A. - Reg’d		7,476		41,790
Consumer Services 0.1%
Melia Hotels International S.A.		4,711		34,902
NH Hoteles S.A. *		11,834		41,216
				76,118
Diversified Financials 0.1%
Bolsas y Mercados Espanoles (a)		3,743		101,594
Energy 0.1%
Tecnicas Reunidas S.A.		1,287		62,364
Food, Beverage & Tobacco 0.2%
Ebro Foods S.A.		6,012		123,328
Pescanova S.A. (b)*		1,125		4,378
Viscofan S.A.		1,442		74,898
				202,604
Insurance 0.2%
Grupo Catalana Occidente S.A.		2,679		60,709
Mapfre S.A.		58,093		212,769
				273,478
Materials 0.1%
Acerinox S.A. (a)		13,705		147,886
Media 0.2%
Antena 3 de Television S.A.		6,953		42,403
Mediaset Espana Comunicacion S.A. *		20,352		159,520
				201,923
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Almirall S.A.		4,106		54,280
Grifols S.A. *		1,082		43,432
Grifols S.A. ADR *		615		19,206
				116,918
Software & Services 0.3%
Amadeus IT Holding S.A., A Shares		6,159		181,731
Indra Sistemas S.A. (a)		12,521		168,465
				350,196
				2,381,954
Sweden 2.3%
Capital Goods 0.3%
Indutrade AB		1,483		51,713
Lindab International AB		11,820		92,979
NIBE Industrier AB, B Shares		2,358		38,486
Peab AB		21,326		119,669
Saab AB, Class B		4,425		97,124
				399,971
Commercial & Professional Supplies 0.2%
AF AB, B Shares		1,664		45,822
Intrum Justitia AB		3,210		66,020
Loomis AB, B Shares		5,798		113,346
				225,188
Consumer Durables & Apparel 0.2%
JM AB		6,822		153,641
Nobia AB		15,274		87,930
				241,571
Diversified Financials 0.2%
D. Carnegie & Co. AB (b)(c)*		851		—
L E Lundbergforetagen AB, B Shares		2,081		81,346
Ratos AB, B Shares		16,088		155,456
				236,802
Energy 0.1%
Lundin Petroleum AB *		2,467		59,319
Food & Staples Retailing 0.1%
Axfood AB		1,649		72,660
Food, Beverage & Tobacco 0.1%
AarhusKarlshamn AB		1,310		68,723
Health Care Equipment & Services 0.2%
Elekta AB, B Shares		4,529		69,445
Getinge AB, B Shares		5,427		163,639
				233,084

46 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Materials 0.2%
BillerudKorsnas AB		6,191		61,451
Hoganas AB, B Shares		1,357		65,000
Holmen AB, B Shares		4,432		124,228
				250,679
Media 0.1%
Modern Times Group AB, B Shares		3,137		134,640
Pharmaceuticals, Biotechnology & Life Sciences 0.1%
Meda AB, A Shares		9,693		116,030
Real Estate 0.2%
Castellum AB		4,748		71,094
Fabege AB		6,335		68,608
Kungsleden AB		15,506		108,724
				248,426
Retailing 0.1%
Bilia AB, A Shares		4,321		75,075
Clas Ohlson AB, B Shares		2,248		30,313
				105,388
Technology Hardware & Equipment 0.1%
Hexagon AB, B Shares		4,566		130,991
Transportation 0.1%
SAS AB *		63,193		138,429
				2,661,901
Switzerland 2.7%
Banks 0.1%
Banque Cantonale Vaudoise - Reg’d		75		41,556
Valiant Holding AG - Reg’d		554		51,943
				93,499
Capital Goods 0.6%
AFG Arbonia-Forster Holding AG - Reg’d *		2,344		67,147
Georg Fischer AG - Reg’d *		363		158,103
Huber & Suhner AG - Reg’d		821		40,088
Implenia AG *		843		46,284
OC Oerlikon Corp. AG - Reg’d		5,401		62,519
Rieter Holding AG - Reg’d *		369		61,671
Sulzer AG - Reg’d		1,091		186,441
Zehnder Group AG		744		32,917
				655,170
Commercial & Professional Supplies 0.1%
DKSH Holding Ltd.		930		80,875
Gategroup Holding AG *		2,166		41,931
Kaba Holding AG - Reg’d, Series B *		118		46,195
				169,001
Consumer Durables & Apparel 0.0%
Forbo Holding AG - Reg’d		74		47,780
Consumer Services 0.1%
Kuoni Reisen Holding AG - Reg’d, Series B *		304		92,787
Diversified Financials 0.2%
Julius Baer Group Ltd. *		4,148		165,357
Partners Group Holding AG		186		47,721
				213,078
Food, Beverage & Tobacco 0.3%
Aryzta AG *		2,864		177,827
Barry Callebaut AG - Reg’d *		69		67,413
Lindt & Spruengli AG		12		46,484
Lindt & Spruengli AG - Reg’d		2		89,127
				380,851
Health Care Equipment & Services 0.2%
Nobel Biocare Holding AG - Reg’d *		10,036		112,485
Sonova Holding AG - Reg’d *		924		100,659
Straumann Holding AG - Reg’d		314		41,221
				254,365
Insurance 0.1%
Helvetia Holding AG - Reg’d		292		122,504
Materials 0.2%
Ems-Chemie Holding AG - Reg’d		308		89,070
Ferrexpo plc		10,918		30,457
Schmolz & Bickenbach AG - Reg’d *		24,991		73,272
				192,799
Pharmaceuticals, Biotechnology & Life Sciences 0.2%
Actelion Ltd. - Reg’d *		2,307		141,254
Galenica AG - Reg’d		142		93,238
				234,492
Real Estate 0.1%
Allreal Holding AG - Reg’d *		255		37,326
Swiss Prime Site AG - Reg’d *		760		62,318
				99,644
Retailing 0.2%
Dufry AG - Reg’d *		548		73,007
Valora Holding AG - Reg’d		516		101,446
				174,453
Technology Hardware & Equipment 0.1%
Kudelski S.A. - BR		3,120		39,334
Logitech International S.A. - Reg’d (a)*		14,575		92,935
				132,269
Transportation 0.1%
Flughafen Zuerich AG - Reg’d		140		68,095
Panalpina Welttransport Holding AG - Reg’d		1,044		101,616
				169,711
Utilities 0.1%
Alpiq Holding AG - Reg’d *		649		82,364
				3,114,767
United Kingdom 12.5%
Banks 0.0%
Paragon Group Cos. plc		9,736		47,298
Capital Goods 1.6%
Ashtead Group plc		24,522		224,265
Bodycote plc		13,870		111,751
Chemring Group plc		12,714		53,540
Fenner plc		7,286		39,853
Galliford Try plc		6,737		103,283
Interserve plc		15,411		113,449
Invensys plc		35,509		212,594
Keller Group plc		10,416		139,064

See financial notes 47

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Kier Group plc		3,194		58,182
Melrose Industries plc		19,248		72,960
Morgan Advanced Materials plc		18,723		76,218
QinetiQ Group plc		47,501		139,845
Rotork plc		1,962		88,763
Senior plc		15,866		62,970
Spirax-Sarco Engineering plc		2,408		98,370
The Weir Group plc		5,430		186,282
Ultra Electronics Holdings plc		2,411		61,859
				1,843,248
Commercial & Professional Supplies 1.1%
Babcock International Group plc		8,378		139,410
Berendsen plc		15,752		189,293
Cape plc		11,454		53,065
De La Rue plc		8,951		129,516
Homeserve plc		19,421		63,224
Intertek Group plc		2,745		141,216
Mears Group plc		6,574		35,792
Michael Page International plc		21,752		126,258
Mitie Group plc		26,123		112,118
RPS Group plc		15,290		59,317
Shanks Group plc		50,347		64,037
Sthree plc		11,120		57,994
WS Atkins plc		5,043		70,725
				1,241,965
Consumer Durables & Apparel 0.6%
Bellway plc		11,095		232,083
Berkeley Group Holdings plc		5,285		171,362
Bovis Homes Group plc		8,833		105,399
Guinness Peat Group plc *		210,865		100,312
Redrow plc *		14,731		49,002
The Vitec Group plc		2,976		28,384
				686,542
Consumer Services 0.9%
Betfair Group plc		4,100		55,202
Dignity plc		2,683		57,396
Greene King plc		15,657		176,955
J.D. Wetherspoon plc		10,240		93,497
Ladbrokes plc		53,159		156,396
Marston’s plc		60,400		135,943
Millennium & Copthorne Hotels plc		6,578		57,879
Mitchells & Butlers plc *		34,271		178,333
Rank Group plc		16,329		42,613
Restaurant Group plc		11,525		86,354
Spirit Pub Co. plc		37,493		37,811
				1,078,379
Diversified Financials 1.7%
3i Group plc		25,964		132,769
Aberdeen Asset Management plc		18,065		126,099
Ashmore Group plc		9,401		58,387
Close Brothers Group plc		8,139		131,400
F&C Asset Management plc		37,858		57,631
Henderson Group plc		64,756		166,421
IG Group Holdings plc		13,217		110,702
Intermediate Capital Group plc		21,367		140,467
International Personal Finance		17,051		135,224
Investec plc		25,199		178,440
Jupiter Fund Management plc		8,717		44,877
London Stock Exchange Group plc		8,724		182,040
Provident Financial plc		6,892		174,703
Rathbone Brothers plc		1,422		32,249
Schroders plc		4,274		155,227
Schroders plc, Non Voting Shares		1,664		47,900
Tullett Prebon plc		17,409		66,251
				1,940,787
Energy 0.5%
Enquest plc *		19,256		38,579
Hunting plc		6,811		85,531
Petrofac Ltd.		4,768		100,214
Premier Oil plc *		11,718		68,009
Subsea 7 S.A.		5,449		117,634
Tullow Oil plc		7,825		121,974
				531,941
Food & Staples Retailing 0.2%
Booker Group plc		104,530		193,346
Greggs plc		12,455		80,226
				273,572
Food, Beverage & Tobacco 0.4%
Britvic plc		13,087		89,485
Cranswick plc		4,873		80,009
Dairy Crest Group plc		20,298		145,442
Premier Foods plc *		107,149		121,501
				436,437
Health Care Equipment & Services 0.0%
Synergy Health plc		2,572		43,428
Household & Personal Products 0.1%
McBride plc *		22,894		40,719
PZ Cussons plc		11,911		73,891
				114,610
Insurance 0.8%
Admiral Group plc		6,592		131,313
Beazley plc		28,267		98,748
Catlin Group Ltd.		21,286		174,004
Hiscox Ltd.		19,617		170,992
Jardine Lloyd Thompson Group plc		4,626		60,997
Lancashire Holdings Ltd.		11,201		147,476
Phoenix Group Holdings		10,574		104,230
				887,760
Materials 0.8%
Croda International plc		2,168		83,575
DS Smith plc		48,546		176,375
Elementis plc		13,116		53,846
Eurasian Natural Resources Corp.		24,990		107,464
Evraz plc		40,599		98,797
Filtrona plc		7,727		84,980
Lonmin plc *		25,179		105,617
Petropavlovsk plc		7,635		17,300
Randgold Resources Ltd.		495		40,047
RPC Group plc		8,604		53,202
Victrex plc		1,770		44,159
				865,362
Media 0.2%
Cineworld Group plc		9,535		42,878
Daily Mail & General Trust plc		14,207		151,824
Mecom Group plc		34,480		22,851
				217,553

48 See financial notes

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Pharmaceuticals, Biotechnology & Life Sciences 0.0%
Hikma Pharmaceuticals plc		3,051		46,384
Real Estate 0.6%
Derwent London plc		1,284		46,070
Great Portland Estates plc		4,710		38,963
Hammerson plc		20,813		168,178
Intu Properties plc		22,151		117,975
Mapeley Ltd. (b)(c)*		2,199		—
Savills plc		10,126		91,544
Segro plc		37,015		153,274
Songbird Estates plc *		39,433		85,755
				701,759
Retailing 0.8%
Carpetright plc *		3,182		31,134
Darty plc		197,131		150,045
Debenhams plc		103,890		134,384
Halfords Group plc		26,513		142,002
Howden Joinery Group plc		14,340		55,458
John Menzies plc		3,647		41,327
Lookers plc		32,133		46,669
Mothercare plc *		15,895		78,269
N Brown Group plc		10,346		71,638
Sports Direct International plc *		5,904		42,903
WH Smith plc		11,923		137,225
				931,054
Semiconductors & Semiconductor Equipment 0.2%
ARM Holdings plc		11,000		171,093
CSR plc		12,118		92,921
				264,014
Software & Services 0.2%
Aveva Group plc		1,007		34,760
Computacenter plc		14,512		101,314
Micro Focus International plc		5,129		53,392
Xchanging plc		26,027		54,175
				243,641
Technology Hardware & Equipment 0.7%
Domino Printing Sciences plc		4,023		41,670
Electrocomponents plc		38,432		143,633
Halma plc		11,707		91,136
Laird plc		26,889		90,750
Pace plc		18,321		70,664
Premier Farnell plc		21,331		70,130
Spectris plc		3,874		127,167
Spirent Communications plc		30,336		61,502
TT Electronics plc		20,255		52,386
Xyratex Ltd.		5,200		55,536
				804,574
Telecommunication Services 0.3%
Inmarsat plc		16,536		185,870
KCOM Group plc		30,212		39,726
TalkTalk Telecom Group plc		31,174		121,399
				346,995
Transportation 0.8%
BBA Aviation plc		32,640		127,439
easyJet plc		8,403		146,124
Go-Ahead Group plc		3,994		96,147
International Consolidated Airlines Group S.A. *		57,449		243,409
Northgate plc *		32,442		170,835
Stagecoach Group plc		21,726		103,843
Stolt-Nielsen Ltd.		3,333		68,781
				956,578
				14,503,881
Total Common Stock
(Cost $94,108,625)				111,781,464
Preferred Stock 0.5% of net assets
Germany 0.5%
Automobiles & Components 0.1%
Porsche Automobil Holding SE		1,682		132,079
Capital Goods 0.1%
Jungheinrich AG		1,440		59,460
Health Care Equipment & Services 0.1%
Draegerwerk AG & Co. KGAA		472		58,249
Materials 0.1%
Fuchs Petrolub AG		1,277		107,786
Media 0.1%
ProSiebenSat.1 Media AG		3,555		135,686
				493,260
United Kingdom 0.0%
Household & Personal Products 0.0%
McBride plc (b)		389,198		605
Total Preferred Stock
(Cost $333,941)				493,865
Other Investment Companies 0.9% of net assets
Australia 0.0%
Australian Infrastructure Fund		14,576		47,599
United States 0.9%
iShares MSCI EAFE Small Cap Index Fund (a)		23,000		1,047,190
Total Other Investment Companies
(Cost $937,056)				1,094,789

See financial notes 49

 Schwab Fundamental International Small Company Index Fund

Portfolio Holdings (Unaudited) continued

	Face
Security	Amount		Value
Rate, Maturity Date	($)		($)
Short-Term Investments 3.2% of net assets
Time Deposits 3.1%
Bank of Tokyo-Mitsubishi UFJ
US Dollar
0.03%, 05/01/13		3,433,129		3,433,129
Brown Brothers Harriman
Canadian Dollar
0.24%, 05/01/13	��	6,218		6,172
Hong Kong Dollar
0.01%, 05/01/13		5,811		749
Japanese Yen
0.01%, 05/01/13		518,181		5,316
Pound Sterling
0.07%, 05/01/13		3,886		6,036
Swedish Krona
0.05%, 05/01/13		75,460		11,643
Swiss Franc
0.00%, 05/01/13		435		468
Citibank
Euro
(0.00)%, 05/01/13		15,068		19,843
DNB
US Dollar
0.03%, 05/01/13		36,910		36,910
JPMorgan Chase
Norwegian Krone
0.40%, 05/01/13		126,751		21,981
				3,542,247
U.S. Treasury Obligations 0.1%
U.S. Treasury Bills
0.07%, 06/20/13 (d)(e)		10,000		9,999
0.09%, 06/20/13 (d)(e)		167,000		166,980
				176,979
Total Short-Term Investments
(Cost $3,719,226)				3,719,226
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 2.8% of net assets
Wells Fargo Advantage Government Money Market Fund		3,235,192		3,235,192
Total Collateral Invested for Securities on Loan
(Cost $3,235,192)				3,235,192
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $99,772,946 and the unrealized appreciation and depreciation were $22,941,525 and ($5,625,127), respectively, with a net unrealized appreciation of $17,316,398.

At 04/30/13, the values of certain foreign securities held by the fund aggregating $96,271,539 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees.

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	Fair-valued by management in accordance with procedures approved by the Board of Trustees.
(c)	Illiquid security. At the period end, the value of these amounted to $21,629 or 0.0% of net assets.
(d)	All or a portion of this security is held as collateral for open futures contracts.
(e)	The rate shown is the purchase yield.

ADR —	American Depositary Receipt
CVA —	Dutch Certificate
GDR —	Global Depositary Receipt
Reg’d —	Registered
REIT —	Real Estate Investment Trust
RSP —	Risparmio (Convertible Savings Shares)
SDR —	Swedish Depositary Receipt

In addition to the above the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI EAFE, e-mini, Long, expires 06/21/13		19		1,653,760		76,178

50 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings as of April 30, 2013 (Unaudited)

This section shows all the securities in the fund’s portfolio and their values as of the report date.

The fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be viewed and copied at the SEC’s Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for information on the operation of the Public Reference Room. The schedule of portfolio holdings filed on a fund’s most recent Form N-Q is also available by visiting the fund’s website at www.schwabfunds.com/prospectus.

				Cost		Value
Holdings by Category				($)		($)
	90	.0%	Common Stock		286,472,038		292,368,067
	8	.7%	Preferred Stock		32,364,495		28,157,895
	0	.7%	Other Investment Company		2,399,360		2,380,950
	0	.4%	Short-Term Investments		1,212,180		1,212,180
	99	.8%	Total Investments		322,448,073		324,119,092
	0	.1%	Collateral Invested for Securities on Loan		284,700		284,700
	0	.1%	Other Assets and Liabilities, Net				203,046
	100	.0%	Total Net Assets				324,606,838

	Number		Value
Security	of Shares		($)
Common Stock 90.0% of net assets
Brazil 5.8%
Banks 1.3%
Banco Bradesco S.A.		77,770		1,346,471
Banco do Brasil S.A.		191,500		2,405,296
Itau Unibanco Holding S.A.		22,658		386,174
				4,137,941
Capital Goods 0.2%
Embraer S.A.		83,600		731,644
Diversified Financials 0.2%
BM&F BOVESPA S.A.		94,900		658,833
Energy 1.9%
Petroleo Brasileiro S.A. - Petrobras		633,300		6,071,070
Food, Beverage & Tobacco 0.4%
BRF-Brasil Foods S.A.		39,500		977,259
Companhia de Bebidas das Americas		5,380		219,959
				1,197,218
Materials 1.2%
Companhia Siderurgica Nacional S.A.		183,300		723,764
Gerdau S.A.		26,300		177,853
Usinas Siderurgicas de Minas Gerais S.A. *		37,600		190,936
Vale S.A.		165,800		2,838,261
				3,930,814
Telecommunication Services 0.1%
Oi S.A.		21,514		63,335
Tim Participacoes S.A.		102,856		433,890
				497,225
Utilities 0.5%
Centrais Eletricas Brasileiras S.A.		123,103		334,099
Cia de Saneamento Basico do Estado de Sao Paulo		36,900		519,173
Companhia Energetica de Minas Gerais		10,056		127,161
CPFL Energia S.A.		49,500		533,162
				1,513,595
				18,738,340
Chile 0.8%
Energy 0.2%
Empresas Copec S.A.		44,255		632,575
Materials 0.1%
Empresas CMPC S.A.		106,328		387,585
Utilities 0.5%
Empresa Nacional de Electricidad S.A.		307,809		545,311
Enersis S.A.		2,402,374		904,889
				1,450,200
				2,470,360
China 11.0%
Banks 4.3%
Agricultural Bank of China Ltd., Class H		1,421,600		681,221
Bank of China Ltd., Class H		7,054,234		3,305,149
BOC Hong Kong (Holdings) Ltd.		235,000		809,853
China Construction Bank Corp., Class H		6,560,000		5,505,877
China Merchants Bank Co., Ltd., Class H		206,350		440,787
Industrial & Commercial Bank of China Ltd., Class H		4,383,172		3,089,718
				13,832,605
Capital Goods 0.3%
China Communications Construction Co., Ltd., Class H		565,000		542,280
Citic Pacific Ltd. (a)		293,000		355,277
				897,557
Consumer Durables & Apparel 0.1%
Yue Yuen Industrial Holdings Ltd.		117,000		405,482
Energy 3.1%
China Petroleum & Chemical Corp., Class H		3,228,000		3,562,304
China Shenhua Energy Co., Ltd., Class H		214,000		758,815
CNOOC Ltd.		1,245,000		2,331,971
PetroChina Co., Ltd., Class H		2,635,000		3,358,646
				10,011,736

See financial notes 51

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Food & Staples Retailing 0.1%
China Resources Enterprise Ltd.		130,000		446,308
Insurance 0.5%
China Life Insurance Co., Ltd., Class H		402,000		1,111,924
Ping An Insurance (Group) Co. of China Ltd., Class H		56,000		444,466
				1,556,390
Technology Hardware & Equipment 0.1%
Lenovo Group Ltd.		536,000		490,322
Telecommunication Services 2.5%
China Mobile Ltd.		551,500		6,065,735
China Telecom Corp., Ltd., Class H		2,318,000		1,187,642
China Unicom (Hong Kong) Ltd.		657,056		947,404
				8,200,781
				35,841,181
Colombia 0.2%
Banks 0.1%
Bancolombia S.A.		16,600		272,864
Energy 0.1%
Ecopetrol S.A.		203,831		490,288
				763,152
Czech Republic 0.6%
Materials 0.3%
Unipetrol A/S *		106,421		934,521
Telecommunication Services 0.1%
Telefonica Czech Republic A/S		27,383		395,640
Utilities 0.2%
CEZ A/S		25,446		738,220
				2,068,381
Egypt 0.3%
Telecommunication Services 0.3%
Orascom Telecom Holding S.A.E. GDR - Reg’d *		264,187		891,281
Hungary 0.7%
Banks 0.3%
OTP Bank plc		43,595		910,188
Energy 0.3%
MOL Hungarian Oil & Gas plc		14,625		1,039,563
Telecommunication Services 0.1%
Magyar Telekom Telecommunications plc		260,820		482,396
				2,432,147
India 3.1%
Banks 0.5%
Housing Development Finance Corp., Ltd.		29,263		460,962
ICICI Bank Ltd.		34,727		754,123
State Bank of India		12,412		522,605
				1,737,690
Energy 1.6%
Indian Oil Corp., Ltd.		86,426		480,296
Oil & Natural Gas Corp., Ltd.		278,294		1,690,714
Reliance Industries Ltd.		192,625		2,821,869
				4,992,879
Materials 0.3%
Hindalco Industries Ltd.		244,363		442,881
Tata Steel Ltd.		76,890		433,631
				876,512
Software & Services 0.5%
Infosys Ltd.		25,613		1,060,914
Tata Consultancy Services Ltd.		17,064		436,757
				1,497,671
Telecommunication Services 0.1%
Bharti Airtel Ltd.		75,585		448,249
Utilities 0.1%
NTPC Ltd.		137,331		401,357
				9,954,358
Indonesia 0.8%
Automobiles & Components 0.3%
PT Astra International Tbk		1,022,500		773,671
Energy 0.1%
PT Bumi Resources Tbk		4,666,500		322,586
Telecommunication Services 0.4%
PT Telekomunikasi Indonesia (Persero) Tbk		1,135,500		1,368,031
				2,464,288
Malaysia 1.6%
Banks 0.6%
CIMB Group Holdings Berhad		195,900		498,713
Malayan Banking Berhad		182,000		575,768
Public Bank Berhad		157,400		849,826
				1,924,307
Capital Goods 0.2%
Sime Darby Berhad		226,300		702,435
Consumer Services 0.2%
Genting Berhad		139,900		483,163
Telecommunication Services 0.4%
Axiata Group Berhad		311,300		693,073
Telekom Malaysia Berhad		352,900		640,265
				1,333,338
Utilities 0.2%
Tenaga Nasional Berhad		309,300		798,068
				5,241,311

52 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Mexico 4.1%
Banks 0.2%
Grupo Financiero Banorte S.A.B. de C.V., Class O		79,100		596,460
Capital Goods 0.1%
Alfa S.A.B., Class A		245,000		569,003
Food & Staples Retailing 0.4%
Wal-Mart de Mexico S.A.B. de C.V., Series V		386,900		1,231,218
Food, Beverage & Tobacco 0.6%
Fomento Economico Mexicano S.A.B. de C.V.		112,500		1,279,422
Grupo Bimbo S.A.B. de C.V., Series A		193,900		630,934
				1,910,356
Materials 1.3%
Cemex S.A.B. de C.V., Series CPO *		2,975,128		3,354,348
Grupo Mexico S.A.B. de C.V., Series B		262,700		940,262
				4,294,610
Media 0.4%
Grupo Televisa S.A.B., Series CPO		243,900		1,238,351
Telecommunication Services 1.1%
America Movil S.A.B. de C.V., Series L		3,305,100		3,557,617
				13,397,615
Poland 2.1%
Banks 0.2%
Bank Pekao S.A.		7,347		352,472
Powszechna Kasa Oszczednosci Bank Polski S.A.		39,609		412,449
				764,921
Energy 0.6%
Polski Koncern Naftowy Orlen S.A. *		130,723		2,029,757
Insurance 0.3%
Powszechny Zaklad Ubezpieczen S.A.		6,212		856,823
Materials 0.4%
KGHM Polska Miedz S.A.		26,773		1,259,692
Telecommunication Services 0.2%
Telekomunikacja Polska S.A.		298,370		665,627
Utilities 0.4%
PGE S.A.		141,073		733,153
Tauron Polska Energia S.A.		459,880		613,655
				1,346,808
				6,923,628
Republic of Korea 20.8%
Automobiles & Components 1.6%
Hyundai Mobis		5,367		1,220,289
Hyundai Motor Co.		16,832		3,056,406
Kia Motors Corp.		19,011		948,289
				5,224,984
Banks 1.6%
Hana Financial Group, Inc.		40,157		1,286,075
KB Financial Group, Inc.		41,590		1,360,092
Shinhan Financial Group Co., Ltd.		55,190		1,911,621
Woori Finance Holdings Co., Ltd.		67,760		733,710
				5,291,498
Capital Goods 3.6%
Daelim Industrial Co., Ltd.		5,642		395,162
GS Engineering & Construction Corp.		7,863		216,453
Hyundai Engineering & Construction Co., Ltd.		6,598		346,946
Hyundai Heavy Industries Co., Ltd.		7,303		1,336,146
LG Corp.		75,268		4,489,899
Samsung C&T Corp.		20,100		1,078,930
Samsung Heavy Industries Co., Ltd.		15,120		482,395
SK Holdings Co., Ltd.		17,393		2,510,332
SK Networks Co., Ltd.		99,550		660,332
				11,516,595
Consumer Durables & Apparel 1.1%
LG Electronics, Inc.		46,240		3,706,271
Energy 1.0%
GS Holdings		14,211		704,262
S-Oil Corp.		8,250		665,092
SK Innovation Co., Ltd.		13,026		1,781,104
				3,150,458
Food, Beverage & Tobacco 0.3%
KT&G Corp.		13,040		938,956
Insurance 0.6%
Hanwha Life Insurance Co., Ltd. *		66,330		403,861
Samsung Fire & Marine Insurance Co., Ltd.		3,676		756,493
Samsung Life Insurance Co., Ltd.		7,105		700,332
				1,860,686
Materials 2.4%
Cheil Industries, Inc.		5,300		457,258
Hanwha Corp.		14,460		409,887
Hyosung Corp.		7,260		365,879
Hyundai Steel Co.		8,226		571,510
LG Chem Ltd.		4,829		1,142,816
Lotte Chemical Corp.		2,370		350,775
POSCO		15,782		4,536,174
				7,834,299
Retailing 0.5%
Lotte Shopping Co., Ltd.		1,666		622,162
Shinsegae Co., Ltd.		3,937		846,496
				1,468,658
Semiconductors & Semiconductor Equipment 4.8%
Samsung Electronics Co., Ltd.		10,273		14,207,756
SK Hynix, Inc. *		53,040		1,444,616
				15,652,372

See financial notes 53

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Software & Services 0.3%
SK C&C Co., Ltd.		12,004		1,007,992
Technology Hardware & Equipment 0.9%
LG Display Co., Ltd. *		68,050		1,862,084
Samsung Electro-Mechanics Co., Ltd.		5,039		451,533
Samsung SDI Co., Ltd.		4,355		507,742
				2,821,359
Telecommunication Services 1.4%
KT Corp.		54,780		1,792,340
LG Uplus Corp. *		83,100		785,320
SK Telecom Co., Ltd.		11,432		2,012,315
				4,589,975
Utilities 0.7%
Korea Electric Power Corp. *		81,620		2,353,286
				67,417,389
Russia 14.7%
Banks 0.7%
Sberbank of Russia ADR *		181,254		2,339,395
Energy 11.7%
Gazprom ADR		1,493,970		11,897,920
LUKOIL ADR		239,505		15,228,667
NovaTek OAO GDR - Reg’d.		8,411		853,822
Rosneft Oil Co. GDR - Reg’d		273,215		1,873,854
Surgutneftegas ADR		719,007		6,134,276
Tatneft ADR		53,812		2,041,688
				38,030,227
Materials 0.9%
Mining & Metallurgical Co. Norilsk Nickel OJSC ADR		155,278		2,396,822
Severstal GDR - Reg’d		58,982		505,029
				2,901,851
Telecommunication Services 1.3%
Mobile TeleSystems ADR		101,551		2,102,106
Rostelecom OJSC ADR *		44,840		1,003,690
Sistema JSFC GDR - Reg’d		52,940		1,012,390
				4,118,186
Utilities 0.1%
Federal Hydrogenerating Co., ADR		243,956		421,336
				47,810,995
South Africa 6.5%
Banks 0.7%
ABSA Group Ltd.		29,669		488,803
Nedbank Group Ltd.		20,246		430,497
Standard Bank Group Ltd.		115,450		1,443,642
				2,362,942
Capital Goods 0.8%
Aveng Ltd.		172,231		566,202
Barloworld Ltd.		73,966		774,815
Bidvest Group Ltd.		49,687		1,293,257
				2,634,274
Consumer Durables & Apparel 0.1%
Steinhoff International Holdings Ltd. *		172,052		459,542
Diversified Financials 0.5%
FirstRand Ltd.		255,910		890,337
Remgro Ltd.		29,656		598,236
				1,488,573
Energy 1.2%
Sasol Ltd.		87,533		3,791,624
Food & Staples Retailing 0.1%
Shoprite Holdings Ltd.		23,863		453,152
Food, Beverage & Tobacco 0.1%
Tiger Brands Ltd.		16,164		503,455
Insurance 0.3%
Sanlam Ltd.		178,250		914,568
Materials 1.0%
Anglo American Platinum Ltd. *		8,075		307,759
AngloGold Ashanti Ltd.		10,097		194,808
ArcelorMittal South Africa Ltd. *		151,245		388,665
Gold Fields Ltd.		76,313		572,160
Impala Platinum Holdings Ltd.		80,975		1,109,717
Sappi Ltd. *		188,021		565,729
				3,138,838
Media 0.2%
Naspers Ltd., Class N		9,860		660,744
Retailing 0.2%
Imperial Holdings Ltd.		29,897		662,782
Telecommunication Services 1.3%
MTN Group Ltd.		172,821		3,118,725
Telkom South Africa Ltd. *		565,456		806,579
Vodacom Group Ltd.		23,118		271,047
				4,196,351
				21,266,845
Taiwan 13.7%
Banks 0.4%
Chinatrust Financial Holding Co., Ltd.		983,425		597,244
Mega Financial Holding Co., Ltd.		704,404		543,770
				1,141,014
Capital Goods 0.3%
Far Eastern New Century Corp.		605,743		652,805
Walsin Lihwa Corp. *		1,499,000		465,479
				1,118,284
Consumer Durables & Apparel 0.2%
Pou Chen Corp.		566,267		668,417
Diversified Financials 0.2%
Fubon Financial Holding Co., Ltd.		547,674		783,576
Energy 0.3%
Formosa Petrochemical Corp.		304,330		828,819
Food, Beverage & Tobacco 0.2%
Uni-President Enterprises Corp.		314,794		620,301
Insurance 0.2%
Cathay Financial Holding Co., Ltd.		525,357		707,877

54 See financial notes

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Materials 2.3%
China Steel Corp.		2,062,544		1,819,700
Formosa Chemicals & Fibre Corp.		713,420		1,672,518
Formosa Plastics Corp.		594,820		1,445,002
Nan Ya Plastics Corp.		922,160		1,839,970
Taiwan Cement Corp.		423,299		562,683
				7,339,873
Semiconductors & Semiconductor Equipment 3.2%
Advanced Semiconductor Engineering, Inc.		683,094		595,799
MediaTek, Inc.		112,138		1,368,482
Siliconware Precision Industries Co.		660,270		792,008
Taiwan Semiconductor Manufacturing Co., Ltd.		1,750,689		6,497,562
United Microelectronics Corp.		2,694,965		1,032,733
				10,286,584
Technology Hardware & Equipment 5.6%
Innolux Corp. *		1,308,357		819,231
Acer, Inc. *		1,280,496		1,034,925
Asustek Computer, Inc.		178,041		2,073,706
AU Optronics Corp. *		4,387,800		2,068,121
Compal Electronics, Inc.		1,615,305		1,046,340
Delta Electronics, Inc.		210,025		1,007,661
Foxconn Technology Co., Ltd.		129,197		340,517
Hon Hai Precision Industry Co., Ltd.		1,428,546		3,692,472
HTC Corp.		142,473		1,456,309
Inventec Corp.		1,463,639		585,379
Lite-On Technology Corp.		518,299		933,350
Pegatron Corp. *		735,264		1,205,427
Quanta Computer, Inc.		423,500		876,614
Synnex Technology International Corp.		196,000		331,890
Wistron Corp.		685,498		696,683
				18,168,625
Telecommunication Services 0.8%
Chunghwa Telecom Co., Ltd.		558,906		1,784,081
Far EasTone Telecommunications Co., Ltd.		191,622		466,849
Taiwan Mobile Co., Ltd.		132,600		483,229
				2,734,159
				44,397,529
Thailand 1.1%
Energy 0.9%
PTT Exploration & Production PCL		100,000		524,702
PTT PCL		156,887		1,742,595
Thai Oil PCL		214,700		482,800
				2,750,097
Telecommunication Services 0.2%
Advanced Info Service PCL - Reg’d		81,375		748,595
				3,498,692
Turkey 1.9%
Banks 0.9%
Akbank T.A.S.		95,670		503,747
Turkiye Garanti Bankasi A/S		145,039		802,489
Turkiye Is Bankasi, Class C		178,223		689,365
Turkiye Vakiflar Bankasi T.A.O., Class D		213,030		762,295
				2,757,896
Capital Goods 0.3%
KOC Holding A/S		168,609		1,022,390
Diversified Financials 0.2%
Haci Omer Sabanci Holding A/S		105,159		655,463
Energy 0.3%
Tupras-Turkiye Petrol Rafinerileri A/S		32,427		906,241
Telecommunication Services 0.2%
Turkcell Iletisim Hizmetleri A/S *		117,999		734,728
				6,076,718
United Arab Emirates 0.2%
Real Estate 0.2%
Emaar Properties PJSC		466,445		713,857
Total Common Stock
(Cost $286,472,038)				292,368,067
Preferred Stock 8.7% of net assets
Brazil 7.9%
Banks 2.2%
Banco Bradesco S.A.		170,176		2,798,342
Itau Unibanco Holding S.A.		230,300		3,872,194
Itausa - Investimentos Itau S.A.		101,268		505,138
				7,175,674
Energy 2.1%
Petroleo Brasileiro S.A.		680,200		6,830,048
Food, Beverage & Tobacco 0.3%
Companhia de Bebidas das Americas		26,069		1,078,852
Materials 2.3%
Bradespar S.A.		27,700		353,873
Gerdau S.A.		170,100		1,328,833
Metalurgica Gerdau S.A.		134,400		1,332,077
Usinas Siderurgicas de Minas Gerais S.A., Class A *		139,000		685,013
Vale S.A., Class A		222,000		3,621,682
				7,321,478
Telecommunication Services 0.5%
Oi S.A.		134,811		333,532
Telefonica Brasil S.A.		44,432		1,179,450
				1,512,982
Utilities 0.5%
Centrais Eletricas Brasileiras S.A., Class B		87,700		458,061

See financial notes 55

 Schwab Fundamental Emerging Markets Large Company Index Fund

Portfolio Holdings (Unaudited) continued

	Number		Value
Security	of Shares		($)
Companhia Energetica de Minas Gerais		80,685		1,031,977
Eletropaulo Metropolitana S.A.		58,300		241,563
				1,731,601
				25,650,635
Colombia 0.1%
Banks 0.1%
Bancolombia S.A.		18,400		301,443
Republic of Korea 0.7%
Automobiles & Components 0.2%
Hyundai Motor Co.		2,500		178,061
Hyundai Motor Co., 2nd		4,100		309,489
				487,550
Consumer Durables & Apparel 0.1%
LG Electronics, Inc.		8,000		198,994
Materials 0.0%
LG Chem Ltd.		700		61,210
Semiconductors & Semiconductor Equipment 0.4%
Samsung Electronics Co., Ltd.		1,840		1,458,063
				2,205,817
Total Preferred Stock
(Cost $32,364,495)				28,157,895
Other Investment Company 0.7% of net assets
United States 0.7%
iShares MSCI Emerging Markets Index Fund		55,000		2,380,950
Total Other Investment Company
(Cost $2,399,360)				2,380,950
Security	Face Amount		Value
Rate, Maturity Date	Local Currency		($)
Short-Term Investments 0.4% of net assets
Time Deposits 0.4%
Brown Brothers Harriman
South African Rand
3.90%, 05/01/13		326,233		36,355
Skandinaviska Enskilda Banken
US Dollar
0.03%, 05/01/13		1,065,828		1,065,828
				1,102,183
U.S. Treasury Obligations 0.0%
U.S. Treasury Bills
0.09%, 06/20/13 (b)(c)		10,000		9,999
0.01%, 06/20/13 (b)(c)		100,000		99,998
				109,997
Total Short-Term Investments
(Cost $1,212,180)				1,212,180
End of Investments.
	Number		Value
Security	of Shares		($)
Collateral Invested for Securities on Loan 0.1% of net assets
Wells Fargo Advantage Government Money Market Fund		284,700		284,700
Total Collateral Invested for Securities on Loan
(Cost $284,700)				284,700
End of Collateral Invested for Securities on Loan.

At 04/30/13, the tax basis cost of the fund’s investments was $326,654,343 and the unrealized appreciation and depreciation were $33,126,002 and ($35,661,253), respectively, with a net unrealized depreciation of ($2,535,251).

At 04/30/13, the values of certain foreign securities held by the fund aggregating $247,229,568 were adjusted from their closing market values in accordance with international fair valuation procedures approved by the fund’s Board of Trustees. (See financial note 2)

*	Non-income producing security.
(a)	All or a portion of this security is on loan.
(b)	All or a portion of this security is held as collateral for open futures contracts.
(c)	The rate shown is the purchase yield.

ADR —	American Depositary Receipt
GDR —	Global Depositary Receipt
Reg’d —	Registered

In addition to the above, the fund held the following at 04/30/13.

			Contract		Unrealized
	Number of		Value		Gains
	Contracts		($)		($)
Futures Contract
MSCI Emerging Markets, Mini, Long, expires 06/21/13		22		1,143,890		57,582

56 See financial notes

Item 7: Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8: Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9: Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10: Submission of Matters to a Vote of Security Holders.

Not applicable.

Item 11: Controls and Procedures.

(a) Based on their evaluation of Registrant’s disclosure controls and procedures, as of a date within 90 days of the filing date, Registrant’s Chief Executive Officer, Marie Chandoha and Registrant’s Principal Financial Officer, George Pereira, have concluded that Registrant’s disclosure controls and procedures are: (i) reasonably designed to ensure that information required to be disclosed in this report is appropriately communicated to Registrant’s officers to allow timely decisions regarding disclosures required in this report; (ii) reasonably designed to ensure that information required to be disclosed in this report is recorded, processed, summarized and reported in a timely manner; and (iii) are effective in achieving the goals described in (i) and (ii) above.

(b) There have been no changes in Registrant’s internal control over financial reporting that the above officers believe to have materially affected, or to be reasonably likely to materially affect, Registrant’s internal control over financial reporting.

Item 12: Exhibits.

(a)   (1)   Code of ethics – not applicable to this semi-annual report.

(2)	Separate certifications for Registrant’s principal executive officer and principal financial officer, as required by Rule 30a-2(a) under the 1940 Act, are attached.
(3)	Not applicable.

(b) A certification for Registrant’s principal executive officer and principal financial officer, as required by Rule 30a-2(b) under the 1940 Act, is attached. This certification is being furnished to the Securities and Exchange Commission solely pursuant to 18 U.S.C. section 1350 and is not being filed as part of the Form N-CSR with the Commission.

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant) Schwab Capital Trust

By:	/s/ Marie Chandoha
	Marie Chandoha
	Chief Executive Officer

Date: June 10, 2013

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ Marie Chandoha
	Marie Chandoha
	Chief Executive Officer

Date: June 10, 2013

By:	/s/ George Pereira
	George Pereira
	Principal Financial Officer

Date: June 7, 2013